The second Trump administration will be similar regarding health care to the first one, with very aggressive efforts to implement significant changes to most of the established health care programs in the country, according to Jim Parker, MBA, founder of JTP Advisors, a health care consulting firm.
Parker was joined by Nicholas Uehlecke, principal of Todd Strategy Group, a federal government affairs firm, at the 20th annual Value-Based Insurance Design (V-BID) Summit, held by the University of Michigan’s V-BID Center.
Jim Parker, MBA
Image Credit: JTP Advisors
During President Donald J. Trump’s first term, he ran on repealing the Affordable Care Act (ACA) but pivoted after being unsuccessful. However, it’s difficult to know how lasting any changes will be, since the Biden administration reversed many of the changes from 8 years ago, said Parker, who served as the senior advisor for health reform at HHS under then-Secretary Alex Azar during Trump’s first term.
Changes Coming to Medicaid, Medicare Advantage, ACA Exchanges
Parker and Uehlecke provided their insights on 3 big programs: Medicaid, Medicare Advantage (MA), and the health care marketplace exchanges.
While on the campaign trail, the president said he did not foresee making changes to Medicare, and even as he took office, Trump said he would not make cuts to the program except for fraud or abuse.1 However, the House recently passed a budget plan that includes $880 billion in cuts from the House Energy and Commerce Committee, which oversees health care spending in programs such as Medicaid.2
The budget resolution doesn’t explicitly state the cuts are coming from Medicaid, but “it’s hard to [make those cuts] without touching Medicaid,” Parker said.
The cuts to Medicaid will present an opportunity for the VBID community to “proselytize value more broadly,” he said. Medicaid expansion may have increased coverage, but as the number of eligible enrollees grew, so did the length of time to see a doctor, Uehlecke said. The people the program was originally made to help—those with disabilities or with very low income—are having a harder time accessing the care they need as the program was intended.
Nick Uehlecke
Image credit: Todd Strategy Group
Both Parker and Uehlecke agreed that this administration will also be friendlier for MA, especially in comparison to the Biden administration, “which aggressively took steps to, in their view, right-size or rebalance the program vis-à-vis traditional Medicare.”
Although the Trump administration will be friendlier to MA, there is less “blind support” of the program since large insurers began purchasing pharmacy benefit managers. There is an expectation that there will be some level of reform. Between prior authorization, step therapy, and utilization management, “the dam has to break here, at some point,” Uehlecke said.
In the Medicare program, there was a VBID demonstration that didn’t quite have success due to a lack of participation by plans. Achieving value will mean spending less on unnecessary services and avoiding high-cost and low-value items, while achieving better outcomes. But you can’t achieve that value if low-cost, high-value services are also inaccessible. The problem VBID ran into was when utilization management went from not giving 10 branded drugs to 1 individual without a proper diagnosis to 60% of basic services being denied.
“Maybe the pendulum has swung too far in one direction for what our dream of VBID can achieve if we do not [rein in] a little bit of what we’re considering to be cost-cutting measures,” Uehlecke said. “It does cost money to do preventative services. No one lies about that. But it saves a ton of money in the end.”
The ACA health insurance marketplaces are also a target for the Trump administration. Parker said that the enrollment growth of the marketplace plans benefited both the Biden administration and the insurance companies, which led to longer open enrollment periods and additional special enrollment periods. In response to the COVID-19 pandemic, the administration had opened a special enrollment period.3
In addition, there were reports in 2024 of people finding out their health insurance plans were switched without their knowledge,4 and the Trump administration announced a proposed rule to protect consumers from being enrolled in plans without their knowledge.5 As a result, Parker said, the Trump administration will seek to limit the annual enrollment period back to what it was when the exchanges were originally introduced by the Obama administration.
The Make America Healthy Again Movement
The discussion closed out with the Make America Healthy Again (MAHA) movement, led by new HHS Secretary Robert F. Kennedy Jr. One of the pillars of MAHA is tackling the chronic disease crisis, Uehlecke explained, which aligns with a core pillar of VBID. However, the US does not manage chronic disease well.
“Most people go through their life not understanding they’re prediabetic, not knowing that they’re on the cusp of costing themselves…the [health care] system, the state, the [federal government], their doctor…a ton of money,” he said. However, they could address their health issue by making some changes, such as their diet or taking supplements.
Parker and Uehlecke were followed by Stephanie Carlton, the current acting administrator of CMS, as Mehmet Oz, MD, awaits confirmation by the Senate. She also focused on MAHA and how it addresses Americans’ health by focusing on chronic diseases by understanding how to look at prevention holistically: for instance, a person’s physical activity, nutrition, and other things that are important before “getting to the more formal interaction with the health system.”
The Role of Technology
Another theme for CMS under the Trump administration that Carlton mentioned was using technology to bend the cost curve and improve outcomes in health care. There are 3 key areas for technology to improve:
- Data sets and systems: Improving data governance, security, and availability, particularly building on the Blue Button 2.0 initiative to make Medicare data more accessible to beneficiaries and caregivers.
- Interoperability: Reviewing and updating existing interoperability rules to ensure beneficiaries and caregivers can access the right data, at the right time, securely.
- Innovation: Partnering with entrepreneurs and innovators to harness technologies like generative artificial intelligence to improve individuals’ control over health care and achieve better health outcomes at lower costs.
A Review of Payment Pilot Programs
Just 30 minutes before Carlton joined the V-BID Summit, CMS completed a comprehensive review of models being run by the Center for Medicare and Medicaid Innovation for the purposes of identifying those that truly align with its statutory obligation to reduce program costs while maintaining or improving quality of care. As a result, CMS announced some models would be ending early on December 31, 2025, creating savings of almost $750 million for taxpayers.6 Participants in the models ending early would transition to other models.
“Doing that [realignment of programs] will really enable us to focus most on what works and really find those models that can eventually be scaled and become a mandatory part of the way that we pay providers,” Charlton said.
References
1. Leonard B. Trump vows to ‘love and cherish’ Medicaid — while Republicans plot cuts for savings. POLITICO. January 31, 2025. Accessed March 12, 2025. https://www.politico.com/live-updates/2025/01/31/congress/trump-love-and-cherish-medicaid-00201893
2. Klein H. House passes budget resolution cutting billions from Medicaid funding. AJMC®. February 25, 2025. Accessed March 12, 2025. https://www.ajmc.com/view/house-passes-budget-resolution-cutting-billions-from-medicaid-funding
3. 2021 special enrollment period in response to the COVID-19 emergency. CMS. January 28, 2021. Accessed March 12, 2025. https://www.cms.gov/newsroom/fact-sheets/2021-special-enrollment-period-response-covid-19-emergency
4. Appleby J. Unauthorized ACA plan switches drive call for action against rogue agents. NPR. April 8, 2024. Accessed March 12, 2025. https://www.npr.org/sections/health-shots/2024/04/08/1243328699/health-insurance-obamacare-aca-plan-switch-rogue-agents
5. CMS takes aim to reduce improper enrollments and promote more affordable health insurance marketplaces for millions of consumers. News release. March 10, 2025. Accessed March 12, 2025. https://www.cms.gov/newsroom/press-releases/cms-takes-aim-reduce-improper-enrollments-and-promote-more-affordable-health-insurance-marketplaces
6. Statement on CMS Innovation Center aligning portfolio with statutory obligation. CMS. News release. March 12, 2025. Accessed March 12, 2025. https://www.cms.gov/newsroom/press-releases/statement-cms-innovation-center-aligning-portfolio-statutory-obligation
