Health Care Matters | January 24, 2025
Health Policy Tracker: Trump’s First 100 Days
Executive Orders: Health Care Impact
President Trump took office on Monday and promptly issued a swath of executive orders with fewer than expected aimed health care. For insight on these actions and their potential impacts, read the following:
Trump’s Initial Orders Reverse Biden on Health Care Costs, Protections from Discrimination (STAT)
Donald Trump's Medicare Executive Order Explained (Newsweek)
Republicans Propose $3 Trillion in Health Cuts
"Republicans who hope to cut spending and extend expiring tax cuts are considering a lengthy list of budgetary offsets that includes more than $3 trillion in health care cuts. Read here:
Republicans Outline Trillions in Health Care Cuts (Modern Healthcare)
Trump’s Cabinet Nominees Face Delays
With Donald Trump’s nominees slowly emerging from Senate committees, lawmakers are preparing for a prolonged process as they work through procedural steps to fill out the new president’s Cabinet. Read more here:
Trump Team Taps Dorothy Fink to Serve as Interim HHS Secretary (Washington Post)
The Senate Readies for a Nominee Siege (Politico)
CMS Moves Closer to Accountable Care Goals with 2025 ACO Initiatives
CMS recently released an update on their drive to have all Medicare beneficiaries in accountable relationships by 2030. The data show significant progress on this goal compared to last year with over 53% of traditional Medicare beneficiaries in accountable relationships as of January 2025 - a 4.3 percentage point increase over 2024. Progress over the last year was driven in part by increased participation in ACOs, both in the Medicare Shared Savings Program and organizations participating in Innovation Center accountable care models.
MSSP saw the largest number of annual renewals in the history of the program, with 173 renewing or reentering ACOs in addition to 55 new ACOs accepted for participation. There has also been a marked increase in safety net participation in MSSP in the last year, up 16% from 2024. Additionally, CMMI launched the ACO Primary Care Flex (PC Flex) model on January 1, 2025, with 24 participating ACOs, which contributed to both the increase in MSSP participation overall as well as the rise in safety net participation seen in the program. Read here.
Why It Matters
CMS is employing a range of strategies to reach their goals to varying degrees of success. While progress is being made, some efforts are more fruitful than others. For example, the PC Flex model had the potential to enroll up to 130 ACOs, but only 24 ACOs participated when the program launched on January 1. The program aimed to attract new entrants, especially low-revenue ACOs and those including FQHCs and RHCs. However, the tight timeline between the announcement of the model and the deadline for MSSP applications, which was a prerequisite for CMMI applications, presented significant challenges in reaching the program’s participation targets. As a result, low participation could limit the model's impact on improving primary care delivery and reducing costs. It remains uncertain whether CMS will reopen applications for a second cohort to boost participation in both the model and MSSP overall.
Additionally, ACO REACH is scheduled to end in 2026, and no follow-up model has been announced thus far. With only lower-risk options available in MSSP for ACOs transitioning out of ACO REACH, there is concern that some ACOs may choose to exit the program entirely, rather than shift to a lower-risk MSSP option. This could affect the retention of beneficiaries in accountable care relationships and impede CMS’ progress on their accountable care goals.
HHS Announces 15 Additional Drugs Selected for Medicare Drug Price Negotiations in Continued Effort to Lower Prescription Drug Costs for Seniors
On January 17, the Biden administration announced the next 15 drugs targeted for price negotiation, including Ozempic and Wegovy. This effort aims to build on the success of the last round of price negotiations, lowering prescription drug costs for seniors. Negotiations with drug companies would occur in 2025 with new prices taking effect in 2027, meaning it will be up to the Trump administration to implement them. This announcement comes on the heels of the proposed coverage of GLP-1s in the Medicare Advantage (MA) and Part D rule, reflecting a broader effort to make these medications more accessible and affordable. Read more here and here.
Why It Matters
This announcement is significant as it aims to make drug prices more affordable for seniors, which is a major concern for many Americans. However, the future of this policy is up in the air with the recent change in administration. President Trump has already rolled back Biden-era health policies, including some related to drug prices. While the Trump administration has historically supported lowering prescription drug costs, they have shown a tendency to favor market-based solutions over direct government intervention in drug pricing. As Modern Healthcare reports, lawmakers are urging Trump to move forward with price negotiations but it remains to be seen how the new administration will respond to increasing pressure from the pharmaceutical industry. Some experts, published in Stat, are suggesting the Trump administration may make changes to the negotiation program like setting price floors.
Finalization of the Medicare Advantage and Part D rule also falls to the new administration, which includes provisions for the coverage of GLP-1s. Taken together, these efforts and the new administration’s actions will have far-reaching impacts on the millions of seniors who rely on these drugs.
What We Are Reading
JPM 2025: 10 Takeaways from the San Francisco Conference
Leaders convened last week at J.P. Morgan's 43rd annual health care conference to discuss major topics in health care, including AI, expansion strategies, financial performance, and more. For the top 10 takeaways from the event, read here.
No Health Affairs Forefront: CMS Leaders Reflect on Achievements and Challenges
With the turnover of administrations, Health Affairs Forefront published a series of articles from leaders at CMS providing their thoughts on the major achievements of the last four years, remaining challenges, and lessons learned. For more, read the following:
What we are listening to
Tradeoffs Podcast: Biden’s Medicaid Director Reflects on Lessons Learned and Worries for the Future
Medicaid is facing potential cuts from Republicans in Washington. Dan Tsai reflects on his experiences managing the program under the Biden administration, sharing his hopes and concerns for its future. Listen here.
