MGMA's perspective on CMS’s 2030 shift to value-based care
The Centers for Medicare and Medicaid Services (CMS) has set an ambitious goal to fully transition from fee-for-service models to value-based care by 2030. However, according to Anders Gilberg, Senior Vice President of Government Affairs for the Medical Group Management Association (MGMA), this shift will require significant effort and face numerous obstacles, as he told HealthExec in a video interview.
CMS has long sought to transition to value-based payments, where providers and hospitals are compensated for episodes of care addressing specific health issues, rather than the "nickel-and-dime" approach of paying for every test, procedure, device, or disposable item used. Under the value-based model, hospitals and providers will assume more risk by receiving a lump sum for care, with an economic incentive to streamline care and reduce costs.
Gilberg outlined the challenges involved in such a large-scale transformation. While the healthcare system has made strides toward value-based care over the last decade, he emphasized that progress has been slow, and there is still considerable work to be done.
"I think there will still be stumbling blocks. I think the one-size-fits-all approaches are not ideal,” Gilberg said.
He explained that hospitals and outpatient practices operate under very different dynamics. While hospitals may share common benchmarks such as staffing ratios and emergency room metrics, medical practices—particularly multi-specialty practices—face much greater complexity. Programs like the Merit-Based Incentive Payment System (MIPS), which includes hundreds of quality measures, illustrate the difficulties in implementing standardized reforms.
Fee-for-service models will still be needed
Gilberg predicts that some form of fee-for-service will remain essential over the next decade, even as value-based care continues to grow. He cited the importance of advancing technology and leveraging data for population health management as potential tools to drive improvement. However, he noted that systemic issues, such as the way Medicare programs are scored by the Congressional Budget Office (CBO), create barriers to rewarding preventive care. He said those issues need to be worked out to emphasize preventive care over reactive care, especially when a condition or disease has become serious and harder to treat.
"I think hopefully using technology and other tools, we can get better at population-based management and we can actually implement systems that reward preventive care in the Medicare program more than they do now," Gilberg said.
He said Medicare is unique from private insurance carriers because patients are typically enrolled for life. While we want people to live longer and healthier lives, those quality-of-life improvements and economic contributions are not always captured in policy discussions, he added.
"We want that 80-year-old to be out there contributing to GDP. But those quality of life and macroeconomic factors are not necessarily measured by the Congressional Budget Office. When they see that people are living longer, it just means more people will be on the Medicare program. So that's one of the tricky pieces is often the score of some of these programs in Congress," Gillberg explained.
Rise of Medicare Advantage
Another complicating factor is the rapid growth of Medicare Advantage, the privately administered alternative to traditional Medicare. In 2023, over 50% of Medicare beneficiaries were enrolled in Medicare Advantage plans, and that number is expected to rise to 75% by 2030. Unlike traditional Medicare, these plans operate under individual contracts with insurers like UnitedHealthcare and Humana, each with its own value-based care initiatives.
He said the expansion of Medicare Advantage adds another layer of complexity, where the goals and incentives vary widely across insurers and their patient populations, making it harder to align value-based care strategies across the board.
"It is a lot of moving pieces with the expansion of Medicare Advantage and there is need to still be clinically relevant. That's going to make this still pretty complicated in the next 10 years," Gilberg explained.
Dave Fornell has covered healthcare for more than 17 years, with a focus in cardiology and radiology. Fornell is a 5-time winner of a Jesse H. Neal Award, the most prestigious editorial honors in the field of specialized journalism. The wins included best technical content, best use of social media and best COVID-19 coverage. Fornell was also a three-time Neal finalist for best range of work by a single author. He produces more than 100 editorial videos each year, most of them interviews with key opinion leaders in medicine. He also writes technical articles, covers key trends, conducts video hospital site visits, and is very involved with social media. E-mail: dfornell@innovatehealthcare.com