Keeping up-to-date with US healthcare policy, which has been on a tumultuous course over the past few years, is a nearly impossible task. Americans were offered a snapshot of what the White House has in store in late 2017, however, when President Trump directed his staff through an executive order to focus on development and operation of a healthcare system that delivers affordable, high-quality care by promoting choice and competition.1 In response to that executive order, the US Department of Health and Human Services (HHS) recently released its own report, Reforming America's Healthcare System Through Choice and Competition, in conjunction with the departments of the Treasury and Labor, the Federal Trade Commission, and several offices in the White House.2 The executive order and subsequent HHS report offer insights and recommendations for healthcare that can affect every PA and the patients we serve. Let us explore these policies and potential ramifications for PAs.
A FOCUS ON HEALTHCARE CONSOLIDATION
The president's executive order to promote healthcare choice and competition was issued on October 12, 2017.1 It addresses a number of issues purported to make healthcare more affordable and accessible. The order puts a spotlight on healthcare insurance, proposing purchase of insurance across state lines and improvements to association healthcare plans, short-term limited-duration insurance, and health reimbursement arrangements. It draws critical attention to increasing competition by limiting consolidations throughout the US healthcare system, preventing abuses of market power, improving transparency around costs, and lowering barriers to entry.
The order's position on consolidations, namely healthcare mergers and acquisitions, is a strong one and is in stark contrast to the Affordable Care Act (ACA). A major effect of the ACA has been an uptick in consolidations among hospitals and healthcare delivery systems. In fact, 2017 was a record year for healthcare mergers and acquisitions. This makes sense because the ACA contains incentives for shifting patient care from inpatient to outpatient settings. As a result, hospital systems acquired physician practices to capture outpatient revenue and lock in referrals for hospital-based services. The ACA and other healthcare policy and payment reforms compelled big investments in expensive information technology systems, complex arrangements to tackle population health, and bigger bargaining power to navigate changing financial models in healthcare. Consolidations help hospitals access capital and make these types of investments possible. The ACA is not the only driving force in consolidation, as the Medicare Access and CHIP Reauthorization Act (MACRA) also plays a key role. MACRA shifts provider reimbursement from a quantity of care to a quality paradigm, a shift that has challenged many smaller practices. We increasingly see providers join larger group practices, be acquired by hospitals, or form collaborative models like accountable care organizations.3,4
Consolidations in healthcare have brought about several undesirable consequences. When groups that were formerly competitors in a market come together, competition is naturally reduced. Less competition can affect the quantity, quality, and cost of care. A recent analysis of data from the Center for Consumer Information and Insurance Oversight observed significantly higher annual premiums of marketplace plans and healthcare costs in less-competitive healthcare markets, namely areas where the majority of patient volume has been assumed by large hospital systems.5 Similarly, a 2014 economic analysis estimated that physician consolidation caused an 8% increase, on average, in fees for healthcare services over the past 20 years and significantly higher increases in markets with high provider concentrations.6 Mergers have been shown to increase the likelihood of intensive surgery and total number of surgeries but not improve patient outcomes.7 Consolidations have been found to reduce hospital costs per risk-adjusted discharge but not reduce the price of hospital care to insurers.8
I have informally observed a variety of effects of consolidations in the shift of many physician colleagues from owners to employed providers. This shift not only affects physicians—benefits and negative effects, alike—but can also change the employment relationship and interpersonal dynamic between PAs and collaborating physicians. Although these effects are not as well described as the potential effects of consolidation on competition or healthcare costs, they can make a big difference in the daily experience of PAs, on physician-PA collaboration, and on scope of practice determinations.
IMPLICATIONS FOR PA LICENSURE AND PRACTICE
The HHS report offers encouraging recommendations on removing barriers to practice for healthcare professionals, including PAs. According to HHS, “Government policies that reduce the available supply of qualified healthcare service providers or the range of services they may safely offer can increase the prices paid for healthcare services, reduce access to care, and suppress the benefits of competition and innovation in healthcare delivery.”2 The report adds, “Government rules restrict competition if they keep healthcare providers from practicing to the ‘top of their license’—i.e., to the full extent of their abilities, given their education, training, skills, and experience, consistent with the relevant standards of care.”2 In its recommendations, HHS says, “States should consider eliminating requirements for rigid collaborative practice and supervision agreements between physicians and dentists and their care extenders (e.g., physician assistants, hygienists) that are not justified by legitimate health and safety concerns.” Interestingly, the report recognizes that many states have granted full practice authority to advanced practice RNs and specifically notes that there is significant room for improvement in other states and for other professions. HHS also recommends federal government and states consider accompanying legislative and administrative pathways that would permit PAs to be paid directly for their services where evidence supports that we can safely and effectively provide that care. HHS encourages strategies to support licensure portability across state lines for greater efficiency, which may be realized through interstate compacts or model laws. Finally, HHS supports changes in licensure and practice regulation to support greater access to care via telehealth; HHS acknowledges that “telehealth can enhance price and non-price competition, reduce transportation expenditures, and improve access to quality care.”2
For any PA who has been engaged in professional advocacy efforts in recent years, these revelations from HHS likely feel like a breath of fresh air and invigorate us to continue to optimize PA practice to best meet the needs of the patients, families, and communities we serve. The position of HHS largely reinforces long-standing and emerging policy and guidance of national PA organizations, including the American Academy of PAs' “The Six Key Elements of a Modern PA Practice Act,” “Model State Legislation for PAs,” and “Guidelines for State Regulation of PAs,” the latter being the source of optimal team practice (OTP).9-11 In 2017, PAEA endorsed autonomous state boards and direct reimbursement for PAs in a task force publication on OTP.12 PAEA opposed the elimination of legal provisions that require PAs have a collaborating physician. Consistent with HHS, the National Commission on Certification of Physician Assistants recognized telehealth as an important healthcare trend, which is described in its Certified #PAsDoThat! campaign (www.pasdothat.net/Prepared-Proven). In any case, this federal report forms a critical analysis of several aspects of US healthcare and makes a compelling argument to evolve the current system through greater competition, innovation, and by easing a number of existing regulatory barriers affecting patients and providers.
Many days, I have felt the notion of healthcare providers having the opportunity to practice to the top of their education, skill, and license is little more than a pipe dream. Despite the current tenor of political division in Washington, D.C., and in statehouses all across the country, I am entering the new year hopeful that positive changes in health policy lie ahead for PAs. Having access to affordable, high-quality healthcare is important to every American, and PAs have proven for more than 50 years that we are compassionate, clinically competent, committed to our communities, and capable of lowering the cost of that care.
2. US Department of Health and Human Services, US Department of the Treasury, US Department of Labor. Reforming America's Healthcare System Through Choice and Competition. Washington, D.C., December 3, 2018.
3. Burns LR, Pauly MV. Transformation of the health care industry: curb your enthusiasm. Milbank Q
5. Polyakova M, Bundorf MK, Kessler DP, Baker LC. ACA marketplace premiums and competition among hospitals and physician practices. Am J Manag Care
6. Dunn A, Shapiro AH. Do physicians possess market power. J Law Econ
7. Hayford TB. The impact of hospital mergers on treatment intensity and health outcomes. Health Serv Res
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8. Schmitt M. Do hospital mergers reduce costs. J Health Econ