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Republicans Reconsider Opposition to Medicare Innovation Center

By Andrew Siddons, CQ Roll Call

November 17, 2016 -- Republicans have called for abolishing a center created in the health care law that was designed to test innovative ideas, citing it as an example of federal overreach. But now, with the party set to overhaul the health care system, Republicans might look to that center to implement changes they would like to see.

The Center for Medicare and Medicaid Innovation was established under the 2010 overhaul to support new models of care and payments under Medicare and Medicaid. Getting rid of the center is near the top of the list of President Barack Obama's health care policies that Republicans want to repeal as part of a plan by Republican Speaker Paul D. Ryan of Wisconsin.

Republicans opposed the way that some of the center's demonstration projects required many doctors, hospitals or others to participate. They particularly opposed its March proposal for reimbursing prescription drugs that doctors administer. If finalized, that proposal would affect many doctors and patients around the country, as well as the pharmaceutical industry. For Republicans and many Democrats, it went too far.

The center's proposal to change how hip and knee replacements are paid for also was met with opposition from hospitals.

"They are routinely overstepping their authority and forcing mandates in health care that are termed 'demonstration projects' that have serious long-term implications," House Ways and Means Chairman Kevin Brady, R-Texas, told CQ.

However, Republicans, who are now in control of the White House and both chambers of Congress, could reshape the center to their own ends.

"I think done right, clearly, innovation is key to making health care affordable and saving Medicare for the long term. But that agency needs real scrutiny," Brady said.

The center could be used by Republicans to pursue changes in Medicare and Medicaid that they might not be able to do legislatively. At the very least, Republicans want to see how they might make the innovation center more transparent and keep it from doing anything they wouldn't approve.

"I think the concept, the theory behind it in passing it, is good. But I think this administration went way beyond that," said Rep. Pat Tiberi, R-Ohio, chairman of the Ways and Means Health Subcommittee. "I am open to hear as to why it would be a good thing to keep, but maybe put some guardrails on it in terms of what parameters they have."

The unpredictability of President-elect Donald Trump's policies could also drive Republicans to keep the innovation center on a short leash. "I certainly don't know what this administration might do. They might be the same in terms of using it in a broader way than what we would have envisioned," Tiberi said.

In the meantime, health groups are trying to advocate for changes to the center that could make it more accountable to Congress while still resulting in better outcomes and reduced federal health spending.

On Thursday, the Healthcare Leadership Council, a group representing executives from hospitals, insurers, and pharmaceutical companies, launched a new coalition known as the Healthcare Leaders for Accountable Innovation in Medicare. These groups want Congress to limit the scale of the demonstration projects and ensure that the center establishes quality measurement tools to monitor its proposals. They also want more transparency, in terms of both stricter congressional oversight and more active engagement by the center with outside groups.

Before any of that might happen, Republicans will have to get past their anger over the Part B demonstration project and other far-reaching initiatives. A bill (HR 5122) to repeal the initiative would cost $395 million over a decade, according to a Congressional Budget Office estimate released earlier this fall.

"We have to remember innovation is more than just new payment models," said Tom Valuck, principal at Discern Health and a former Medicare official.

Dan Crippen, a former director of the Congressional Budget Office and the National Governors Association, hopes that Republicans begin to understand the center's value and walk back from the plan to repeal the center. "I think it will be less a target and hopefully more constructive," he said.

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