Finding Healthcare’s True North: Keeping fundamental principles at the forefront of healthcare reform


The 115th Congress and the Trump Administration are embarking upon a new era for healthcare. Several proposals have been introduced and House Republicans have committed to legislative action this week.

As with any major reform, industry and other stakeholders from all perspectives have come out in support of, or opposition to some or all publicly available repeal and replace measures. At the same time, there are countless additional recommendations being floated by various interests and stakeholders to modify Medicaid and the commercial insurance markets.

Making sense of all this noise requires a compass, and the discipline to follow it. Healthcare’s true north can be reached by committing to basic principles and ensuring final proposals embody those principles.

HMS’s mission is to “work passionately to increase the value of the healthcare system so that healthcare dollars can benefit more people.” With that in mind, we encourage decision makers to set and follow some clear, guiding principles as outlined by our new Principles of Reform document.

As it relates to Medicaid, a program that serves over 60 million individuals nationally, and provides coverage to some of our nation’s most vulnerable—including pregnant women, children, and the disabled—guiding principles should include a commitment to preserve this safety net and ensure access to comprehensive, affordable, quality coverage.

Medicaid is a jointly funded and administered healthcare program. Numerous proposals are under consideration to modify this important relationship. Whatever changes made, they should embody the guiding principles, and not result in cost shifting or a weakened state-federal partnership. Instead a strengthened state and federal financial, programmatic and operational partnership should arise.

At the same time, Medicaid is a publicly funded program, made possible by state and federal tax dollars. The judicious use of, and protection for taxpayer dollars is paramount and should guide all reforms.

Today, Medicaid’s payment error rate is almost 10%. This is simply unacceptable. Healthcare costs cannot be bent without the instillation and enforcement of accountability for all stakeholders, including states and the federal government, providers and those who receive benefits under the Medicaid program. Simplistically stated, accountability must include ensuring:

  1. Medicaid pays last;
  2. Claims are billed and paid appropriately;
  3. Services are medically necessary and appropriate; and
  4. Services are provided to eligible individuals by eligible providers.

To this end of accountability, overwhelmingly stakeholders support the pursuit and prosecution of bad actors committing fraud. Fraud; however, makes up only 20% of total improper payments. Waste and abuse accounts for the lion’s share of improper payments. The pursuit of fraud is not a hall pass for the pursuit of waste and abuse. Waste and abuse must be rooted out of the system, much the same as fraud, but utilizing different tactics. Doing so ensures sustainability of these programs and aligns with aforementioned guiding principles, including the protection of taxpayer dollars and instilling accountability for all stakeholders.

Alternatives to Medicaid coverage include other government sponsored programs, and the individual and group markets. Given this undeniable relationship, care must be taken to strengthen the individual market, while ensuring a desirable future state for employer sponsored coverage which insures nearly 180 million Americans today.

By adopting these guiding principles, healthcare reform is possible and quality, affordable healthcare can be achieved.


Kristen Ballantine is vice president of government relations for HMS.