How Trump Is Reforming Medicare, Part I

The Trump administration is making fundamental changes to the Medicare program. These reforms are every bit as radical as the changes we have seen in federal policy governing employer-provided coverage and the market for individual insurance. Further, it seems likely that the changes initiated so far are only the beginning of a continuing shift in the role of government in health care.

The vision behind these reforms can be found in Reforming America’s Healthcare System Through Choice and Competition. This 124-page document from the Department of Health and Human Services challenges a premise behind 50 years of thinking in health policy circles: the idea that our most serious problems in health care arise because of flaws in the private sector. Most problems arise because of government failure, not market failure, the document declares, and it goes into great detail on how to correct the policy errors.

Trump policy toward health care is based on the idea of promoting choice, competition and market prices. In Medicare, so far, that means liberating telemedicine, liberating Accountable Care Organizations, ending payment incentives that are driving doctors to become hospital employees, promoting hospital price transparency, deregulating paperwork and creating more transparency in the market for prescription drugs. We’ll cover some of those policy changes today and the rest next week.