HHS Secretary Alex Azar outlines 4-point plan to accelerate shift toward a value-based system

HHS Secretary Alex Azar outlined four priorities for the agency this week, and accelerating the path to value-based payment systems and reducing healthcare costs are at the top of his list.

In remarks given to the Federation of American Hospitals on Monday, Azar delivered a blunt message.

“Today’s healthcare system is simply not delivering outcomes commensurate with its cost,” he said.

Despite recent advances in areas such as personalized medicine and cell therapies, he said, chronic diseases, including opioid addiction and high healthcare costs are still big problems.

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While the administration has expended its efforts to repeal parts of the Affordable Care Act, Azar stated unequivocally that there would be “no going back to a system that pays for procedures rather than value,” and promised that the administration has no fear of disrupting current arrangements, regardless of the special interests backing them.

He also indicated a willingness to embrace “perhaps even an uncomfortable degree” of federal intervention in order to make the system work better for the stakeholders he sees as least well-served currently: patients and taxpayers.

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The secretary outlined four broad shifts in policy that he said will accelerate the move toward a system that rewards value:

1. Moving ownership and control of electronic health records from providers to patients.

Azar said lack of interoperability among current systems is the main barrier to patients’ ability to take control of their own healthcare information.

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2. Providing payers and providers with incentives to be more transparent about healthcare costs.

The increasing prevalence of high-deductible insurance plans have made consumer awareness of the cost of their care much more important, according to Azar.

He called on doctors, hospitals, drug companies and pharmacies to get more transparent about their costs and outcomes. If they fail to do so, he promised that the federal government has “plenty of levers to pull that would help drive this change.”

3. Using Medicare and Medicaid to drive industry change.

Calling the results of previous efforts to drive innovation such as efforts around affordable care organizations “lackluster,” the secretary promised “bold measures” that will “create a true competitive playing field where value is rewarded handsomely.”

4. Reducing regulatory burdens.

Azar promised that the government would address any regulatory burdens that impede progress toward value-based care provision.

He particularly singled out reporting rules and FDA policies around communications that he said might inhibit collaboration among stakeholders.