Center for Medicare and Medicaid Innovation

Quick reminder, if you have a question or comment for me for a future Mailbag episode, please send it to healthcare rounds at darwinresearch.com. And if you're not receiving our weekly newsletter, you can also subscribe at darwinresearch.com. Today, I'm speaking with Dr. Patrick Conway.

He previously served as CMS's Chief Medical Officer and Director of the Center for Medicare and Medicaid Innovation, where he helped architect the value-based care models that still shape reimbursement today.

He then went on to lead Blue Cross Blue Shield of North Carolina, and has now held multiple senior leadership roles inside UnitedHealth, including CEO of OptumRx and CEO of Optum Health, and most recently as CEO of Optum, the company's full health services division.

Patrick, welcome to Health Care Rounds.

Then in 2010, the Affordable Care Act expanded CMS's role in healthcare coverage, payment reform, and quality improvement.

It created the Center for Medicare and Medicaid Innovation, commonly known as the Innovation Center or CMMI.

CMMI was authorized to test alternative healthcare payment and service delivery models intended to improve quality while reducing spend.

CMS was no longer just administering established reimbursement systems.

It was increasingly testing new ways to pay for healthcare.

Or the IRS can clarify when food as medicine fits within existing rules for commercial coverage.

Third, we need to keep embedding food as medicine into durable payment vehicles, such as Medicaid 1115 demonstration waivers in lieu of services, CMS Innovation Center models, and managed care contracts, and then refining these services using that real utilization and cost data.

When all of those pieces come together, food as medicine services can be better prepared to move from this pilot status to part of how we routinely finance and deliver care.

Erica is making the case for clear, durable pathways to cover food as medicine as part of health care.

And as I said earlier, the red flag that we have is...

How are they talking about or thinking about value-based care? Is it just something that is being forced on them by a payer, something that they feel like they have to participate in through either an MSSP ACO program or a mandatory CMMI program? It really needs engagement and buy-in from

the C-suite.

When it comes to value-based care, I think it's really interesting because a lot of times, and I'm curious to understand from you what the common response is from these executives and C-suite overall, when it comes to value-based care, they're all used to mostly fee-for-service and making money based on the amount of procedures that they do.

A while back, I had the founder of Rainfall Health, where they saw that team model implementation for hospitals and private practices.

You seem, I guess, unusually constructive about these mandatory models.

I'm curious about your takes about what your thoughts about team and how, for example, CMMI needs to keep pushing in that direction overall.

for reimbursements and things like that.

Before joining Applied Policy, you spent eight years at the Centers for Medicare and Medicaid Services.

You worked on Medicare Advantage Part D and the design and implementation of several CMMI payment models.

That's, I think, the right kind of an important context, especially when we get into the discussions in a couple of minutes.

So I think All of that makes you really a perfect guest for our discussion today, because we're looking at one of the most, at least currently, significant changes in global pharmaceutical pricing, the growing use of most favored nation pricing in the US, and what could mean not only for American drug price, but also pricing, launch sequencing, and patient access in Europe and around the world.

In the final rule, they're projecting only $440 million.

That's a 96% drop in federal savings between the proposed and the final rule.

Another way to look at it, we're looking at something like $60 million a year, which is only a little bit really above the average CMMI model operating budget.

why did the savings collapse? There's two big reasons, really.

And that's what made me think, hmm, I don't know next time if, you know, really the government is necessarily the best equipped for.

for delivering this kind of service and i think you see that in government right government creates the structure creates the policy through which the private sector can then deliver the type of care and so that's really what brought me to care bridge and main street and now harmony cares which is that ability of taking what the government sets as a structure in our case value-based care delivered by CMMI, the Center for Medicare and Medicaid Innovation, and using that structure to deliver better care outcomes at lower costs for the American people.

So certainly, you know, I foresee that my career might still ebb and flow between government and the private sector because as opportunities come up and wherever I can maximize the impact of the work, that's really where I'm going to go.

And just to clarify, when you say government was rolling out and doing a lot of the enacting as opposed to the structure and the offloading to the private sector, that was uniquely a result of emergency circumstances.

I'm gonna expound a little bit.

CJR is a CMMI model.

Correct.

And for those of you who don't know, it's a Center for Medicaid and Medic- Medicare and Medicaid Innovation Center.

Um, they want predictability on spend, they want predictability on episode length, they want predictability on, uh, management costs.

And again, we have some of that data, but we don't have all of it.

And this is again that whole, how do we create a CMMI test case to get the actuarial certification that we would potentially need to allow, um, or allow HHS to expand a model that we could champion or we could lead at that point?

I absolutely agree with that.

They were discussing access to your medical data, and the candor in this private space was remarkable.

Jacob Schiff, who's the chief AI and technology officer at the CMS Innovation Center, actually told industry vendors on a Zoom call that he hoped the agency's work would serve as a sales engine for their apps.

A sales engine.

Mm-hmm.