Democrats skeptical of Medicare payment reform efforts amid proposed funding cuts

Medicare written on paper with a stethoscope
A top Medicare official says the White House is committed to driving the market toward value-based care, despite proposed cuts to the program. (Getty/Design491)

A top Medicare official says payment reforms are alive and kicking despite proposed cuts to the program by the White House.

Demetrios L. Kouzoukas, principal deputy administrator at the Centers for Medicare & Medicaid Services (CMS) affirmed Wednesday at a House Ways and Means Health Subcommittee hearing that the Trump administration is dedicated to increasing value-based care and reimbursements instead of paying "for sickness and procedures."

But several Democrats on the committee weren't buying it. Rep. Earl Blumenauer, D-Ore., a member of the subcommittee, said despite Kousoukas's "encouraging tones," he is "more than a little troubled" by proposed funding cuts. 

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"Looking at the budget from the administration that's a third-of-a-trillion-dollar cut in Medicare over time, and efforts to undermine the work to pay for value over volume," he said.

The congressman's comments reference President Donald Trump's fiscal 2019 budget which includes nearly $5 billion in cuts to Medicare, which the administration says is designed to "reform payment and delivery systems and address fraud, waste and abuse."

Rep. Terri Sewell, D-Ala., also had concerns with the budget.

"Our healthcare system is supported by payments from Medicare and Medicaid," she said at the hearing. The proposed cuts "would send shock waves through the entire healthcare system." She also expressed concern about how small and rural committees would fare under the cuts.

RELATED: Trump budget calls for ACA repeal, cuts to Medicare and Medicaid

Kouzoukas tried to assure her that rural providers, sometimes the only provider in remote areas, wouldn't be adversely affected by the president's budget.

"This is very much at the forefront of our minds," Kouzoukas said. "We are working to make sure the programs we undertake and the way we implement them won't hurt rural providers."

Rep. Adrian Smith, R-Neb., said the biggest struggle for rural healthcare providers is the amount of paperwork and administrative burden imposed by the Medicare agency. Kouzoukas said regulatory burden is one of the things slowing the transition to paying for care, and reducing burden is a major goal of the administration.

Blumenauer also raised concerns about recent actions by the White House that might slow the transition to value-based care.

Last year the CMS canceled mandatory hip fracture and cardiac bundled payment models, as well as episode payment models and cardiac rehabilitation incentive payment models. In early 2018, the agency announced a new voluntary bundled payment program, but skeptics worry the approach might not be enough to drive providers to take on more value-based care. 

"It appears that the administration, on one hand, is working against the very goals that you have here," he added. "We ought to be troubled by the schizophrenia on the part of the administration."