Republicans on the House Energy and Commerce Committee lambasted the failure of CMS’ Innovation Center to save U.S. healthcare dollars during a recent hearing on value-based care.
Republicans suggested a variety of drastic actions like stopping projects that haven’t demonstrated cost savings, slimming the Center’s funding or shutting it down.
The Center for Medicare and Medicaid Innovation (CMMI) is tasked with driving the transition to value-based care. It runs demonstration projects that test different payment models and strategies for CMS to engage in the healthcare system to improve patient outcomes.
Several CMMI models pay for medical technology and virtual care, like telehealth services in the dementia-focused GUIDE and remote monitoring services in its primary care VBC model, Making Care Primary.
Republicans took issue with CMMI’s spending and lack of savings since the center's establishment in 2010 by the Affordable Care Act, which projected it would save nearly $80 billion over two decades. According to a September 2023 report by the Congressional Budget Office, CMMI spent $5.4 billion more than it saved in its first decade. In the next decade, CBO estimates CMMI will increase spending by over a billion dollars.
Because of this, Republicans said CMMI has failed as a money-saving project for U.S. healthcare. Elizabeth Fowler, deputy administrator of CMMI, who has been at the center for three years of its 14 years in existence, fought back, saying that CMMI has engaged in valuable projects, even if it’s not yet reducing costs.
Republican Chair of Energy and Commerce Cathy McMorris Rodgers, R-Wash., said CMMI is “unsustainable” and said she has, “a hard time believing any objective observer could look at the results thus far and describe CMMI as a success.”
Republicans tempered their criticisms with recognition that CMMI’s Accountable Care Organization REACH model has been successful in driving ACO creation and bringing more value-based care into the system.
Fowler spoke on behalf of the Center during the hearing. In her opening statement, Fowler enumerated the value of CMMI in driving the transformation of the U.S. healthcare system. When lawmakers drilled into why the Center has not generated savings, Fowler said CMMI’s voluntary participation model can make it hard to generate cost savings as providers can drop out or in as they please.
Fowler repeatedly stressed that CMMI views all its programs as successful because they generate important lessons for the Center. She also said that Congress should look at how CMMI is improving quality of care, which is another one of its statutory mandates.
Fowler said in addition to the ACO program, CMMI is proud of its Making Care Primary model that gives small, independent and rural practices who may not want to join an ACO an option to participate in value-based care.
Rodgers slammed the center for focusing resources on collecting social determinants of health data such as information on patients' food insecurity and housing and for requiring “ridiculous health equity plans.”
Democrats largely touted the benefits of the Innovation Center.
John Sarbanes, D-Md., applauded CMMI’s state total cost of care (TCOC) model, the All-Payer Health Equity Approaches and Development (AHEAD) Model that takes after Maryland’s longstanding hospital all-payer system.
Fowler described the successes from 2023, the first full year of the 11-year program. “We've seen a reduction in Medicare fee-for-service cost of 2.1% over the course of the last model, and a reduction in hospitalizations of 16%,” Fowler said. “We've also seen an improvement in quality for underserved populations that we're really pleased about, in terms of lower readmissions and other quality measures that really indicate that the model is making a difference."
Ranking E&C Democrat Frank Pallone, New Jersey, said CMMI has reduced healthcare costs for families, benefited 41 million beneficiaries in the last few years and increased investments in primary care. CMMI has also benefited Medicaid through the transforming maternal health model, Pallone said, and improved access to cell and gene therapy.
Ranking Democrat of the health subcommittee Anna Eshoo, California, navigated through the partisan stances and took a more nuanced approach in her questioning. She pointed out that CMMI is not saving money and said her constituents are wary of accountable care organization (ACO) models, while allowing Fowler to speak for CMMI’s progress.
Rep. Michael Burgess, R-Texas, said when he wanted to do away with CMMI during the Trump administration, the CBO said Congress could not do so because its cost savings were supposed to be achieved over a period of years. “Those savings are ephemeral. They weren’t really savings at all,” Burgess said.
Chair of the health subcommittee Brett Guthrie, R-Kentucky, applauded CMMI’s Cell and Gene Therapy (CGT) Access Model, which is initially focusing on sickle cell patients. Through the program, CMS negotiates directly with pharmaceutical manufacturers for the pricing of their tests to be based on outcomes for cell and gene therapies (outcomes-based agreements). State Medicaid programs can then choose to accept the terms.
Fowler said CMMI is excited about the project and has received letters of intent from states that represent 80% of sickle cell patients
Guthrie asked why CMMI couldn’t expand the project to include other conditions to benefit more patients. In response to expanding the program, Fowler said the center wants to “avoid biting off more than it can chew.”