Proposed ACA reforms could unintentionally erode affordability and access, destabilizing the very marketplaces they aim to strengthen.
As Congress advances a sweeping Affordable Care Act (ACA) reform package, experts warn that the proposed fixes could unravel years of hard-won progress in access, affordability, and coverage stability.
These experts spoke as part of a June 11 KFF panel — How the Trump Administration and Congress Are Reshaping the Affordable Care Act’s Marketplaces: Views from the States — and included:
Cynthia Cox, KFF vice president and director of its Program on the ACA
Michele Eberle, executive director of the Maryland Health Benefit Exchange
Pat Kelly, executive director of Your Health Idaho (also a state-based marketplace)
Larry Levitt, KFF Executive Vice President for Health Policy
Introducing the panel, moderator Levitt summarized the impacts of the looming legislative and regulatory agenda — an estimated $793 billion in Medicaid cuts and another $268 billion in Marketplace premium assistance cuts, both over 10 years.
"At a trillion dollars in cuts in total, this would be the biggest rollback in federal support for health coverage ever," noted Levitt.
With final legislative votes looming, the panel urged Congress to pause and consider the downstream effects of the ACA reform package.
CSR appropriations: A fix that could break more than it solves
Some see cost-sharing reductions (CSRs) as the number one healthcare issue in the House’s "big, beautiful bill."
CSRs are federal subsidies that lower out-of-pocket costs for eligible low-income marketplace enrollees. Since 2017, following the Trump Administration’s abrupt decision to halt CSR payments to insurers, many states turned to a workaround known as "silver loading" — recouping the cost of unpaid CSRs on the backs of silver-tier plans and their enrollees
While silver loading began as a workaround, it has become integral to how the marketplace works — helping to increase overall premium subsidies, plan choices, and insurer stability.
"It's a little bit counterintuitive," says Cox of KFF. "But actually appropriating money and paying out the cost-sharing subsidies saves the federal government money relative to a scenario where insurance companies are charging a higher premium for silver plans."
Now, Congress is considering restoring CSR appropriations without protecting silver loading. This could raise net premiums and reduce plan choices for millions of marketplace enrollees.
"I think you'll see a little bit of a ripple effect," notes Idaho’s Kelly, adding: "You’ll have people dropping out. The first people that drop out are healthy individuals, so you’ll see a deterioration in the risk pool."
"It’s one more block of that Jenga tower being pulled out for 2026."
Expiration of enhanced tax credits: The looming affordability cliff
While the current package addresses CSR payments and silver loading, it leaves the future of enhanced subsidies uncertain. The scheduled expiration of enhanced premium subsidies at the end of 2025 — and their omission from current legislation — threatens an affordability cliff for low- and middle-income consumers.
Maryland’s Eberle noted: "Without any action from Congress, there's going to be a lot of confusion . . . How do we message that? How do we communicate? Because we know that our consumers who are used to auto enrollment will get that notice and be quite confused."
KFF’s Levitt added: "All told the Congressional Budget Office estimates that 10.9 million more people would be uninsured as a result of the Medicaid and ACA changes."
Cox concluded: "The enhanced premium tax credits expiring would change the net premium, meaning that people get less financial help, so they pay a larger share of the total premium."
This in turn, she added, would affect the Marketplace risk pool.
"We would expect that people who are sicker or higher risk would be more likely to keep their coverage . . . What that means is that on average, the people left in the market are sicker so that has the effect that insurance companies charge more for the premium."
Enrollment barriers: The quiet crisis of administrative complexity
Administrative barriers like pre-enrollment verification and underinvestment in marketplace infrastructure risk coverage losses come at a time when millions are transitioning from Medicaid.
Even as structural affordability is debated, a quieter crisis is unfolding in the form of enrollment barriers. One such barrier — pre-enrollment eligibility verification — has drawn concern for its unintended consequences.
Administrative complexity has long been an Achilles’ heel of public programs. Adding new hoops — no matter how well-intentioned — risks shrinking coverage gains, particularly for marginalized populations with limited time, resources, or digital access.
"I think the biggest issue will be if there's any additional barriers created for consumers who have for 12 years been auto-renewed in the process we've been using," noted Eberle.
"If that process changes and we're not able to communicate that effectively or they just don't expect it, then the outcome might be that someone loses that opportunity to enroll during the open enrollment period and may be locked out a coverage for another year."
"Newton’s Law" and the ACA: The unintended consequences are already in motion
Pat Kelly summed up the stakes by citing Newton’s Third Law: "For every action, there is an equal and opposite reaction."
Related to healthcare reform, Kelly cited the real-life tradeoffs families in his state could face.
"It means that a young family, a family of four here in the Treasure Valley, they
may have to choose between having health insurance or a soccer or travel team for their kids. Or we could have people in agriculture in the southeastern part of the state or up north where their income is more unpredictable. They could also have to make some really hard choices about investing in their agriculture business or choosing health insurance.
Adds Kelly: "I don't think for either of those situations, those are really good options."
As a second Trump administration takes shape, concerns are mounting over the future of behavioral health progress in federal policy. The reasons include proposed steep budget cuts to the Substance Abuse and Mental Health Services Administration (SAMHSA), Medicaid work requirements that could reduce access to care for individuals with mental health and substance use disorders (MH/SUD), and new limits on 1115 Medicaid waivers that help serve these same needs.
These developments raise an interesting question: Would the Innovation in Behavioral Health (IBH) model have been greenlit during a second Trump Administration — given its rollback of social determinants funding and early termination of value-based care pilots.
Refresher: The IBH model and the states implementing it
The IBH model is a big deal.
Announced in December 2024, the IBH model is an eight-year CMS initiative that empowers specialty behavioral health providers to lead integrated care teams. These teams coordinate physical, behavioral, and health-related social needs (HSRNs) for Medicaid and Medicare enrollees with moderate to severe MH/SUD disorders.
IBH is the first-ever federal model to focus on MH/SUD disorders. It’s also the first to put specialty behavioral health providers, not primary care, at the helm of care integration — and jointly for Medicaid and Medicare populations. Both populations are more likely to use the ER and hospitals for their care, have poor health outcomes, and even die prematurely.
For many of these patients, the behavioral health setting is their true front door to the healthcare system. That’s why IBH flips the traditional script. Instead of relying on primary care, IBH makes specialty behavioral health providers the anchors of integrated care teams. These providers will screen for physical health issues and HRSNs, manage care transitions, track patient status, and partner with community organizations to address equity gaps.
And they won’t do it alone. Medicaid agencies—and their managed care partners—will be responsible for building networks, training providers, implementing new payment models, and improving data and analytics. The idea is to prepare these behavioral health systems for future value-based payment models, a CMS spokesperson told HealthLeaders.
Four states were selected for the model’s first phase: Michigan, New York, Oklahoma, and South Carolina. Each state received $7 million plus in federal grants to fund planning, data integration, and provider transformation activities between 2025 and 2032.
Michigan will focus on both rural and urban regions, including the Upper Peninsula, using existing behavioral health clinics as its base.
New York will target the western region in collaboration with its mental health and substance use agencies.
Oklahoma plans to go statewide, investing in care gap alerts, EHR upgrades, and integrated referrals through its Medicaid and behavioral health agencies.
South Carolina will build on an executive order from Governor Henry McMaster to fix a fragmented system that often fails patients with dual diagnoses.
Each state will tailor the model to local needs—but all will operate under a core set of IBH pillars: Care Integration, Care Management, Health Equity, and Health IT.
To approve the IBH model, CMS used the regulatory scaffolding of Section 1115 waivers, which give states flexibility to tailor their Medicaid programs. But as HealthLeaders has documented in multiplearticles — and as KFF is tracking — 1115 waivers are now under threat.
Waiver whiplash
The Trump administration’s early moves suggest a tightening grip on waiver funding, particularly around Designated State Health Programs (DSHPs)—a financing tool that frees up state dollars to reinvest in new Medicaid initiatives.
Think of DSHPs as a bridge to innovative programs like IBH, especially when used to address the social drivers of poor behavioral health outcomes.
But under Trump 1.0, that bridge began to crumble. In 2017, CMS announced it would stop approving new or renewing 1115 demonstrations that relied on DSHP funding. At the time, the agency argued there was no “compelling case that federal DSHP funding is a prudent federal investment.”
The Biden administration reversed course. CMS rescinded the Trump-era guidance, approved DSHP funding in eight states, and used the freed-up state dollars to fund HRSN services — many of which mirror the IBH model’s goals. Importantly, CMS attached guardrails: DSHP funding could not exceed 1.5% of a state’s Medicaid spending, at least 15% of state contributions must come from non-federal sources, and any initiative must align with core Medicaid objectives like access to covered services.
These are the kinds of technical, targeted financing moves that often fly under the radar until they disappear.
Deleting demonstrations
Other recent moves from the CMS Innovation Center (CMMI) also indicate that IBH might have struggled to see the light of day.
On March 12, CMS announced it would prematurely terminate four alternative payment models (APMs) by year’s end. While three were already nearing their planned end dates, one—Making Care Primary (MCP) — was barely out of the gate. Launched in mid-2024 with a planned 10-year run, MCP was designed to help primary care providers ease into prospective payments while integrating behavioral health and specialty care.
If MCP couldn’t survive, IBH might not have either.
The other three models on the chopping block — Maryland’s Total Cost of Care, Primary Care First, and the ESRD Treatment Choices model — each tested new ways to align payment with outcomes. Their early exits raise uncomfortable questions: Is this simply CMMI continuing to streamline its strategy, or the beginning of a broader pullback on value-based care innovation?
Behavioral health innovation at risk?
On paper, CMS’s Innovation in Behavioral Health (IBH) model looks like a bipartisan win: targeted federal investment, a state-led delivery strategy, and a strong focus on outcomes for complex, high-cost Medicaid and Medicare enrollees.
But CMS’s recent moves signal more than just a change in policy. They mark a reversion to an earlier mindset — one less concerned with social needs, less experimental with payment, and more skeptical of state-level flexibility.
In this political moment, the question isn’t whether IBH model is good policy. It’s whether the model would’ve made it through the front door of a second Trump Administration.
That’s the $7-million question. Based on the Trump administration’s track record with waivers and model terminations, there’s good reason to be skeptical.
Dr. Sachin Jain and Mike Plumb detail what providers are missing and how collaborative health plans can help.
“In far too many cases, providers themselves signed up for arrangements they didn’t fully understand.” So notesDr. Sachin Jain, President/CEO of SCAN Group and SCAN Health Plan — a $5.3B non-profit that serves over 300,000 members.
"There's a lot of variability across providers in the degree of understanding that they have about Medicare Advantage revenue and how it works,” he tells HealthLeaders. “Some of the more sophisticated providers understand pretty well what the plan economics look like. They've got actuaries on their teams that understand how a Medicare Advantage bid works and how the revenue works. But not everyone does."
Jain describes the strategies some carriers use.
“Non-transparent Medicare Advantage plans sometime underpay providers through opaque reimbursement schemes, shifting costs, and hidden terms buried deep in contract appendices.”
The “hidden pitfalls” of provider contracting
Jain cites three examples as “the most common contractual design flaws that providers fail to scrutinize upfront”:
Star ratings
Supplemental benefits
Risk adjustment
Each of these impacts a provider’s Percentage of Plan Premium (POP).
Under POP, the government pays a premium to the health plan, which then pays a percentage of that premium to its contracted providers. Providers want that percentage to not only be fair but on par with what other providers receive (parity).
But Plumb warns that many providers have an incomplete view of this model, and to their detriment.
“Focusing on percentage alone is a provider’s first mistake. If a provider is focused only on the first P [percentage] and not the second [premium], that’s where they can get into trouble with not being paid enough.”
The CFO provides an example of how a provider negotiating a higher POP could be offset by the premium: 90% of a $900 premium and 81% of a $1,000 premium yield the same payment: $810.
"The question is, are providers doing that math on all of their health plan contracts and figuring that out?” Plumb asks.
“With Percentage of Premium contracts, the second P matters as much as the first P. What we try to do at SCAN is promote transparency by having discussions with the providers about what the plan economics are in a way that is going to help them across Star ratings, supplemental benefits, and risk adjustment.”
Another part of that transparency is a clear definition of the premium. In MA Part B rebate plans, for example, the insurance company pays part or all of a member’s monthly Part B premium.
"A lot of providers didn't realize that plans were subtracting the Part B rebate amount before calculating the contracted POP [e.g., removing a $125 Part B rebate from the premium, the second P] and paying the capitation amount."
How Star Ratings lower provider payments
Medicare Advantage Star Ratings affect a health plan’s premium revenue from CMS. If a plan’s rating drops, their payment drops — as does what providers receive.
“The biggest variant is the Star Rating,” adds Plumb. “If you're a four-and-a-half Star plan versus a three-star plan, the revenue differences are more than $100 per member per month (PMPM) for the provider.”
“That’s a material difference.”
Plumb adds that not every contract is a good contract and that there is an alternative to partnering with every payer.
“The better option may be to contract with the plans that perform better on Stars,” says Plumb. That’s could fix a lot of the revenue problems for providers.”
How providers end up paying for member benefits
There’s a saying in healthcare: Squeeze the cost balloon in one place and it bulges in another. An example is MA plans with zero-dollar premiums and supplemental benefits (e.g., dental, vision, fitness, meals). Members may save, but someone must pay.
Jain and Plumb note that plans can recoup these supplemental benefit costs from providers in two ways:
Excluding them from the defined premium (again, the first P)
Recapturing their costs by hiding them in the Division of Financial Responsibility (DOFR) section of the contract, which defines which party — plan or provider — is at risk and for what.
Jain recommends that providers read the fine print
How risk adjustment takes its toll
Risk adjustment is a payment approach that helps account for differences in patient health by increasing payments for sicker individuals and reducing payments for healthier ones. There’s just one problem: Some MA plans have been accused of exaggerating member health conditions to receive higher payments. CMS reports that annual overpayments range from $17 billion to as high as $43 billion.
Plumb notes, however, that risk adjustment’s original intent was positive: to prevent adverse selection — a health plan’s strategy to only cover healthy people.
“The risk model was implemented to avoid that situation and to align revenue with cost. This is still crucial for the success of Medicare Advantage. Coding must be accurate and revenue consistent.”
"Providers and plans need to work together to ensure that MA revenue is consistent with the costs that are going to be incurred,” says Plumb.
“That's the way we view it. That assurance is crucial to the success of Medicare Advantage going forward."
Jain recommends that plans support providers with documentation and coding resources to ensure fair compensation.
The importance of partnership
The Star Rating, supplemental benefit, and risk coding examples illustrate the importance of patient volume, revenue margin and scale.
“Initially, with small member volumes, there isn’t much cause for concern. Reimbursements seem manageable,” says Jain.
Plumb agrees.
"A lot of times it is a volume game that providers are playing, not a margin game. But volume's no good if there's no margin."
He adds: "People talk about scale, but scale only exists with the presence of positive contribution. If you add more members that you're losing money on, you're not actually getting any scale."
But Jain emphasizes that “not all Medicare Advantage plans play games. There are plans that are transparent, collaborative, and committed to the long game.”
Plumb echoes this.
“We just believe that we're all better off if everybody understands what's going on. We believe in transparency, we believe in partnership, and we want to help providers understand plan economics so that we can work together toward joint success.”
The good get better while the bad get worse as overall member satisfaction declines slightly.
J.D. Power has released the results of its 2025 U.S. Commercial Member Health Plan Study. This year’s study, now in its 19th year, highlight notable and growing gaps in member satisfaction among the nation’s health insurers.
“Brand performance gaps in the commercial health insurance market are no longer subtle—they’re widening in ways that directly affect satisfaction, retention and competitive strength,” said Caitlin Moling, J.D. Power senior director of global healthcare intelligence in the study press release.
“Leading plans are setting themselves apart by delivering clarity, digital convenience and member-first communication. Others are falling behind as trust erodes, digital tools go underutilized, and members struggle to understand their coverage.”
Moling’s observations highlight the key takeaways of the report — which included 147 health plans in 22 regions throughout the United States and also assessed member satisfaction impact on employers.
Key takeaways
The J.D. Power study was based on responses from 39,797 commercial health plan members surveyed from September 2024 to March 2025. It found:
Member satisfaction with health plans was lower and varied. While the national average was 563 on a scale of 1,000, regional scores ranged from 523 to 594. These results created a drag on overall satisfaction, which declined slightly from 2024.
Members who understand their out-of-pocket costs and out-of-network coverage have higher satisfaction, fewer denials, and better access to care. Conversely — among members who were not clear on out-of-network benefits — 48% had a claim denied and 56% reported that they lacked access to their doctor of choice.
Digital tools go unused. When members do take advantage of these tools — in such areas as chronic condition management, provider communication, and remote monitoring — satisfaction is generally high.
This last finding “points to a critical disconnect between digital availability and member awareness,” notes the press release.
Member satisfaction favors regional, Blues and provider-led plans
The J.D. Power study measures member satisfaction based on based on performance (poor-to-perfect) across eight core dimensions:
able to get health services how/when I want
digital channels
ease of doing business
helps save time and money
people
product/coverage offerings
resolving problems or complaints
trust
Across these metrics, 2025 health plan performance mirrors past years with many carriers repeating their top rankings — some for decades.
The leader here is Kaiser Foundation Health Plan, the insurance arm of one of the nation’s leading integrated health systems, Kaiser Permanente. In multiple states or regions where Kaiser operates — California, Colorado, Maryland, Virginia and the South Atlantic — members ranked its health plan first in satisfaction. This was for the 18th consecutive year in California and the 16th consecutive year in the study’s South Atlantic region.
Kaiser was followed closely by Blue Cross Blue Shield plans, which were top ranked in nine states, some also for consecutive years.
In addition to Kaiser, four other provider-operated plans were ranked first in their geographies:
Capital District Physicians’ Health Plan (New York for the fifth year)
Providence Health Plan (Northwest region)
UPMC Health Plan (Pennsylvania for a second year)
Baylor Scott & White Health Plan (Texas)
Aetna was the lone national plan to earn top rankings in the study and in two states: Ohio and Southwest region.
Of the 22 states and/or regions that J.D. Power defines, UnitedHealthcare — the largest national commercial insurer — ranked last in member satisfaction in 11.
Performance impacts employer decision-making
Member experience has become a competitive differentiator for health plans. The J.D. Power study notes that 20% of employers “cite low employee satisfaction as a top reason for switching health plans.”
The study also called out the role of deductibles, an out-of-pocket cost that affects such member satisfaction metrics as access, cost and trust.
The J.D. Power results shows that higher deductibles hit small employers harder. While more than half of employees meet their deductibles, regardless of employer size — 51% small, 52% midsize, 53% large — average deductibles are still high across the board:
$2,847 for small employers
$2,630 for midsize employers
The press release concludes: “Plans that invest in better engagement, education and service stand to gain both members and employer clients.”
UnitedHealth Group’s very bad year, what it means for healthcare reform, and 3 predictors happening right now.
“One of America’s biggest companies is imploding.”
So read the CNN headline this week. That would be disconcerting enough if the company in question — UnitedHealth Group — didn’t also manage the health of tens of millions of Americans.
In just over a year, the organization that many believed would be the first healthcare company to join the trillion-dollar club has been downgraded by analysts, continues to weather a massive data breach by subsidiary Change Healthcare, and is reportedly under DOJ investigation for Medicare fraud. CEO Andrew Witty just resigned, abruptly and effective immediately. And of course, nearly six months ago, UnitedHealthcare CEO Brian Thompson was murdered.
It is extremely telling that Forbes, in its subsequent calls for industry reform, singled out not only a single company (UnitedHealth Group) but a single human being (Witty). But if a company is too big to fail, is it also too big for healthcare reform to succeed — especially when that company uses its size and scale to delay and deny care?
Four reasons why reform fails
Except for the creation of Medicare, Medicaid and the ACA, KFF writes that most national healthcare reform has stalled since the 1930s due to four recurring conflicts:
The size and role of the federal government, including spending and cost controls
The size and role of private industry, including competition and affordability
Mandates and definitions of basic coverage
Competition with other reforms and economic pressures (costs, inflation, recession)
Describing reform attempts in the 1970s, KFF notes that they were “completely stalled in the face of an economic recession and uncontrollable health care costs.” This could just as easily describe 2025.
Case in point: CMS recently terminated the Medicare Advantage Value-Based Insurance Design (MA VBID) model. The agency cited “substantial and unmitigable costs” — more than $2 billion annually in both 2021 and 2022 — that “no viable policy modifications” could address.
Uncontrollable costs prevent us from controlling costs. Policy cannot fix what policy helped create.
This HealthLeaders series began with the question: “Will Post-Brian Thompson Reforms Go the Way of DEI?” It continued by suggesting that threats to “healthcare’s DEI”— the social drivers of health — could provide an answer. The analysis concludes by identifying three more predictors whose fates are emerging in real time.
Reform predictor #1: The future of Medicaid waivers
Today, both workforce equity and health equity face significant threats. Part 2 of this series explored those threats, including federal cuts to 1115 waivers that allow states to cover healthcare needs rooted in the social drivers of health (SDOH).
KFF’s Section 1115 Waiver Watch agrees, noting: “Recent actions from the Trump administration could signal efforts to curtail waivers related to social determinants of health and to limit waiver financing tools and flexibility.”
The fate of these waivers may depend on three of KFF’s “reform stallers”: the role of the federal government, coverage mandates, and the financial pressures that shape both. That brings us to the next predictor . . .
Reform predictor #2: The Braidwood decision
Rolling back 1115 waivers for SDOH services would undo years of precedent. And the Supreme Court’s Roe v. Wade reversal showed that decades of protected healthcare services are no longer assured.
The same risk is at stake in Braidwood Management, Inc. v. Becerra, which challenges whether private payers must provide free preventive services. As with waivers, Braidwood tests the role of government authority and mandated coverage in healthcare reform. It also adds the impact of private industry.
In April 2023, House and Senate Democrats asked insurers if they would continue covering preventive services. The answer: Yes. But in a July amicus brief in Braidwood, the Blue Cross Blue Shield Association warned that if enough stakeholders reimpose cost-sharing, “it could create perverse competitive incentives for others to follow suit.”
HealthLeaders covered this development with the headline: “Will Payers Waffle?” The same question can be asked of post-Brian Thompson reforms. An early answer was not promising.
Predictor #3: Shareholder activism
“The health care system is flawed. Let’s fix it.” So wrote Andrew Witty in his Dec. 13 New York Times op-ed following Brian Thompson’s murder. The now-former UnitedHealth Group CEO expanded on these comments in the company’s January earnings call, highlighting areas of the industry that could be “enhanced, reworked, reengineered, or even scrapped.”
The same month, United began what would be a successful block of a shareholder proposal that would have required the company to analyze the impact of its prior authorization practices on member access, outcomes and broader public health. The block was aided by Securities Exchange Commission guidance issued after the proposal.
The shareholders, Interfaith Center on Corporate Responsibility, flagged this development, adding that its proposal was “much-needed . . . to consider the systemic risks created by denial and delaying care for policyholders.” The group added that “we fully intend to keep this issue in front of the company in our upcoming dialogues.”
These and other efforts reinforce that commitments to systemic healthcare reform made by one group of stakeholders will require all stakeholders.
“This gives corporations and larger entities more strength than individuals,” adds Henry.
The Interfaith Center on Corporate Responsibility has called out the “public health-related costs and macroeconomic risks of United’s care delays and denials — specifically long-term risks like increasing consumer debt.”
But the risk is far greater.
Houston, we have a (systems) problem
In addition to accounting for 17.6% of GDP, healthcare spending is a major driver of U.S. national debt. Healthcare alone is projected to surpass all other federal spend by 2028 and rise by 73% in the next decade.
In 2024 and 2025 respectively, the Eurasia Group’s top risks were “The United States Versus Itself” and the emerging “G-Zero” world — one in which people have historically low trust in core institutions and “no one power or group of powers is both willing and able” to lead.
Trust and leadership are lacking when they are needed most — in global politics, U.S. healthcare, and perhaps our very culture.
“I think the dysfunction is not only corporate but within society as a whole,” adds Courtney Henry.
“There is systemic dysfunction in the way we take care of our bodies, which is leading to sickness. There's systemic dysfunction in the way our economic system works, which requires us to work 12-hour days just to make ends meet. There is systemic dysfunction in large organizations, where you have 40,000 employees pushing paper every day who aren't connected with the actual mission and are just focused on bottom lines within a department.”
Workplace diversity, equity and inclusion was supposed to be part of the solution.
So, will post-Brian Thompson reforms go the way of DEI? The fate of Medicaid waivers, free preventive care, and shareholder activism may help answer the question. It will take time — perhaps too much already.
Seven years ago, HHS declared the opioid crisis a Public Health Emergency. It has renewed that call 30 times. Seven years ago, U.S. health insurers also signed a consensus statement with the American Medical Association, promising to “help patients get access to safe, timely, and affordable care while reducing administrative burdens for both health care professionals, hospitals and health insurers."
AMA president Dr. Bruce A. Scott invoked that consensus following Brian Thompson’s death.
“Now” — Scott declared, in light of past and future promises — “we await action.”
A new report details how AI plus behavioral science bridges payer-member divides and helps capture lost ROI.
Personalization has been a paradox for payers. Health plan leaders believe that personalized member outreach is important at every stage of care but are still in search of results. The title of a new report from Lirio suggests the solution. (Re)defining personalization: Unlocking the future of superior member engagement and outcomes highlights the importance of “hyperpersonalization” — an approach designed to deliver hard ROI for health plans and lasting health outcomes for members.
“Hyperpersonalization doesn’t mean more engagement but rather the right kind of engagement, delivered in the right way, and at the right time and frequency.”
This HealthLeaders exclusive with den Haring and Lirio’s Chief Behavioral Officer Dr. Amy Bucher details how payers can gain hard ROI from hyperpersonalization that combines artificial intelligence and behavioral science.
Why personalization hasn’t worked: High importance, zero satisfaction
The Lirio report, conducted by Sage Growth Partners, is based on surveys from 70 national and regional health plan leaders. With data on payer AI use, member engagement, and the consumer experience, key takeaways include:
60% of health plan leaders indicated that engaging members to improve quality of care was their top challenge
Many believe that personalization can aid engagement across the health journey, including 77% for chronic care
Yet 0% of payer executives are extremely satisfied with their plan’s member engagement performance.
Other data suggests that core misunderstandings keep payers from investing in personalization.
"There is a question in our survey that I'm really glad we asked, because it reveals how much health plan leaders believe that there is a lack of motivation on the member side,” says Bucher.
In the Lirio report, 84% of health plans say that members are unmotivated to make necessary changes and that that is the most significant barrier to outreach.
“It's my belief that it's actually a failure to personalize, to talk to people, to get to know them in a way that allows us to tap into the things that motivate them well,” the CBO adds. “There is a disconnect between what they think personalization is and what it really is.”
Payer Playbook Step 1: Understand what personalization is and what it is not
Lirio’s CEO believes that questioning traditional definitions of personalization is the first step toward realizing hard ROI.
"As a health plan, if I build the member experience the way I would build a consumer experience, I need to start asking myself some hard questions, says den Haring.
“These include what is the relationship that I want to create and craft with my member to optimize outcomes."
Lirio notes that the industry usually defines personalization as batch-send emails and texts that simply include the patient’s name.
“Is sending an email with 'Hi Marten' personalization? Do you know what motivates me?” says den Haring. “We need to fill in the gap between the assumptions that we're making and how to actually get people to take the actions that we want them to take by starting at the very top level.”
These assumptions also include segmentation, identifying patients by their demographics, conditions or risks.
Bucher adds: “Segmentation is not personalization. Health plans must personalize along dimensions that actually engage people. A big job of personalization is shifting the language of members and payers — bringing them more together and bridging this fundamental divide.”
Lirio is shifting the language with a new term — hyperpersonalization.
Payer Playbook Step 2: Hyperpersonalization where AI meets BeSci
Lirio defines hyperpersonalization as an “n of 1” — an approach that truly understands the unique needs, motivations and behaviors of each individual patient to deliver better outcomes.
Lirio has combined two elements to design its n of 1 approach: Artificial intelligence (AI) and behavioral science (BeSci). AI can deliver precision engagement while BeSci leverages the cognitive, social, and environmental forces that shape behavior.
"N of one is the Holy Grail, but it's misrepresented in healthcare,” says den Haring.
"I don't think you can actually achieve a person-centered experience unless you understand from a design point of view what you're trying to achieve,” the Lirio CEO adds. “It's a combination of subject matter expertise and behavioral science on the design side that involves a lot of research and a lot of tools.”
Lirio embeds AI and BeSci into its member outreach platform, which includes a Personalization Engine and Intelligence Layer. Together, they use real behavioral interactions and outcomes to continually refine key messages and images to uniquely motivate each member through four core capabilities:
Know the member based on comprehensive, integrated data. This includes data that Lirio’s platform creates based on BeSci principles.
“Lirio can generate rich data for health plans that might not emerge without behavioral science training,” says Bucher.
Orchestrate behavioral interventions including “Lego blocks” of content, images, outreach formats and frequencies that tailor messages in real time based on evolving needs and behaviors.
“Most of healthcare is not about doing one thing one time or even a lot of things at one time. It's about developing habits, changing a lifestyle, creating more sustainable behavioral patterns,” Bucher adds.
Learn from member behavior, continuously and automatically until the desired outcomes are achieved. Lirio’s Large Behavior Model “uses real behavioral interactions and outcomes to continually refine key messages and images to uniquely motivate each patient/member.”
“If what's needed is a low-effort behavior, the member might just need a reminder to take their medication. Other times,” Bucher adds “it might take a little bit more, like talking about how to overcome a barrier to a new behavior.”
Move to better health through personalization that begets more personalization that is designed to get results, for not only the member but the health plan.
Says Bucher: “Personalization is a really important ingredient, not in just getting people to start behavior change, but in getting them to sustain it.
Payer Playbook Step 3 — Seek hard ROI in multiple areas
One final but important data point from the Lirio report: Tech investments “skew more short-term” with more payers (61%) planning to invest in population health analytics to support member outreach versus AI (54%) and advanced personalization technology (46%).
den Haring sees a disconnect.
“Tech and AI must be part of the solution but many payers don’t understand what hard ROI is in this space and how to deploy tech to get it.”
The Lirio CEO and CBO Bucher identify several hard ROI potentials for health plans:
Adopting a personalization framework that also compares claims cost approaches
Focusing on areas where personalization is closely tied to medical loss ratio (MLR) and where margins have gotten thinner
Using personalization to address staffing costs and burdens (e.g. BeSci-driven automation that supports Care Managers)
Investing in a “less is more” approach
Here, den Haring notes: “Hyperpersonalization includes reducing the amount of human touch that’s not effective. If an outreach or intervention didn’t work three times, why would it work four?”
He adds: “We're a little too focused on copying and pasting approaches from other industries and applying them as though healthcare was Amazon or Netflix. Healthcare’s challenges are very, very different, and therefore the tools are very different. I don't think a health plan's main goal is for me to buy a bunch of product or spend more time on their portal.
“I think what health plans are really trying to do is to give me enough resources, services and support so that I can live my life as healthy as I can and make good choices. Ultimately, that should reduce costs and risks for the health plan."
HealthLeaders: What is the state of the SDOH union?
Trenor Williams: Healthcare in the U.S. is egocentric. The average adult only spends about an hour in a given year in an outpatient clinic with either a doctor, nurse practitioner or PA. That means they spend over 524,000 minutes outside of that setting. For those of us in the industry to believe that we know all that we need to about a person based on that the short snippet of time feels egocentric.
When I think about SDOH, I think about all of the rest of that time: people living their lives, the advantages and tools they have, the barriers and challenges they face every single day. Our work in the SDOH space is about insights into those 524,000+ minutes and then connecting that data with the robust healthcare data that is available in order to create a holistic understanding of a person, population or community.
If you're caring for a population — whether you're a provider, health plan, or life sciences company — you want to know as much as you possibly can about them so that the interventions you provide have the best chance of meeting their needs, improving their health outcomes and reducing costs.
HealthLeaders: CMS has cut funding for some Medicaid waiver programs that cover SDOH benefits. What are your stakeholders saying — are they nervous?
Williams: With any changes in the broader funding of healthcare, SDOH initiatives are going to require people to be so much more intentional about the work that they do.
They're going to need to have as much insight and information as they possibly can. They're going to have to be precise with the investments that they make and the actions that they take.
They're not going to have the ability to create a big intervention that is presented to everybody but is only really helpful for a specific group of people.
What the industry wants from us is to be much more focused and targeted — matching needs with interventions that create better outcomes.
HealthLeaders: What aspects of SDOH investment are more likely to stay protected and what qualities do they share that will promote persistence?
Williams: I think that's a great question, and I think it's the right question. Rather than thinking about what goes away and what becomes harder, let’s focus on what actually works? What will stay and what will persist are the areas where we can find really good alignment. I think we all want to reduce fraud and abuse. Within these conversations, we have the opportunity to double down on the stuff that actually works.
HealthLeaders: What are some examples of what works?
Williams: I'll give you two that I think are related.
First, I believe there will be significant opportunities to align ongoing work in the SDOH space with the MAHA.
Make America Healthy Again (MAHA) feels like it's going to be a massive initiative from CMS, HHS, and the Administration overall. I think they’re still flushing out the details but — being the son of a social worker and someone who was a family practice doctor — I'll get on board every day of the week and twice on Sunday with making people healthy.
I would argue that increasing access to the right health care for the right people has a chance to improve outcomes and reduce costs and is integral to making people healthier. This includes getting healthy food to people who have diseases or conditions that are improved with good nutrition (e.g., pregnancy, cancer, recovery, diabetes, heart failure) or providing transportation to people to get them to the doctor so that they don’t need to call an ambulance to go to the ER.
Second, I think a focus on return on investment (ROI) in SDOH is key.
If I had a call to action around this, it would be to get the right intervention to the right people; broadly define ROI beyond just financial return; measure, measure, measure; and tell everybody the story.
Discover the three critical signals every healthcare leader and payer needs to watch — before reform efforts possibly unravel.
The question Will Post-Brian Thompson Reforms Go the Way of DEI? requires a precursor: Which way has DEI gone?
HR Daily Advisor, a companion site to HealthLeaders Media, covered these developments extensively throughout 2024 (February, April, July, September, October). This coverage included the creep of government anti-DEI sentiment into the corporate sector. The list of companies now abandoning their DEI posts is long and growing — from Big Retail and Big Auto (Walmart, Target, Ford) to Big Tech (Amazon, Google, Meta) to Big Macs (McDonalds).
Sarah Reynolds, CMO of HiBob and a nonbinary C-suite leader, notes: "For employees who identify as members of marginalized groups, an organization's focus on DEI&B — or lack thereof — can impact every stage of the employee lifecycle."
Similarly, for patients who identify as members of marginalized groups, a focus on health equity — or lack thereof — can affect every stage oflife in general.
The backlash against DEI initiatives in the United States has intensified, driven by a combination of legal decisions, political actions, and cultural debates. So has the backlash against health equity initiatives. While DEI is largely a workplace reform, threats to sustained healthcare reform may not be far behind.
Looking for signals
KFF has identified several ways that eliminating federal diversity initiatives could affect racial health equity in the U.S.:
Dismantling Equity-Focused Health Programs. Ending DEI-driven efforts like CMS's Health Equity Advisory Committee and FDA diversity guidance could weaken efforts to reduce health disparities, especially those linked to systemic racism.
Suppression of Health Equity Data and Research. Cutting or changing public health data and questioning equity-related research makes it harder for the government to spot healthcare disparities, measure progress, or guide policy.
These scenarios may help answer the overarching question of this series — "Will Post-Brian Thompson Reforms Go the Way of DEI?" — using the lens of the social drivers of health (SDOH). These drivers are the non-medical factors that influence health outcomes and include stable access to food, housing, transportation, employment.
Before exploring this connection, it's important to note that DEI and SDOH are not the same.
"DEI initiatives start with race, ethnicity, gender, identify the inequities that exist among groups and aim to close those gaps and make healthcare more equitable. SDOH work includes identifying social risks and needs for a person or and/or intervening and helping to address those needs regardless of a person's gender, race, ethnicity or other criteria."
Even so, commitments to DEI, SDOH or the lack thereof could help predict the trajectory of other reforms that arise from traumatic events — and how likely they are to persist.
Signal #1: Threats to federal funding
As noted above, KFF reported that cutting federal diversity initiatives could dismantle equity-focused health programs. We may already be seeing one of the first examples.
On Apr. 10, CMS announced that it would end spending "that duplicates resources available through other federal and state programs or isn't directly tied to healthcare services [emphasis added]." Examples provided were $241M for non-medical in-home services like housekeeping and a $3.8M diversity medicine initiative — both linked to designated state health and investment programs (DSHP/DSIP) in New York.
DSHP/DSIP are examples of innovative 1115 waiver programs that address SDOH needs with services that Medicaid does not normally cover. CMS noted that this kind of spending "distracts from the core mission of Medicaid."
Signal #2: Threats to data
KFF also noted that suppressing equity-based data and research could suppress health equity itself. This data and research:
has shown that 80% of medical outcomes are based on non-medical factors
put social drivers of health in the national vocabulary
helped fund and create programs to address them
Other research from the CDC shows that non-White populations are more impacted by adverse SDOH and health-related social needs (HRSN). This includes Black, multiracial, Hispanic, Latino, and American Indian/Alaska Native (AI/AN) populations with the disparities ranging from lack of social and emotional support to food, housing, and transportation insecurity to less access to medical coverage and care.
As suggested by KFF, the CDC notes that SDOH and HRSN data can help "monitor needed social and health resources in the U.S. population and help evaluate population-scale interventions."
Population health is central to another bellwether of healthcare reform: the Triple Aim.
Signal #3: Threats to the Triple Aim
Healthcare's Triple Aim is to improve population health, enhance patient experience, and reduce costs. Many of the reforms that UnitedHealth Group and The Cigna Group proposed after Brian Thompson's murder are related to these aims, including:
Cost: United has proposed a 100% pass-through of PBM rebate discounts to health plan members while Cigna wants to make prescription drug costs more predictable.
Experience: Both United and Cigna have proposed better access to and navigation of healthcare, including fewer prior authorization (PA) hurdles.
James Clear, author of Atomic Habits, wrote: "You do not rise to the level of your goals, you fall to the level of your systems."
It remains to be seen whether healthcare's reform goals will also fall to the level of their systems — because the industry very clearly has a systems problem, a topic HealthLeaders will explore next. Read the first part of this article here.
What happens when violent events amplify calls for reform?
Let’s take a trip back in time.
It’s the pandemic, May 25, 2020. George Floyd is murdered on the sidewalk in broad daylight by Minneapolis PD, led by Derek Chauvin. Floyd’s murder “triggered a reckoning on race and policing” with calls for reform ranging from defunding the police to White Privilege book clubs to the strengthening of the Black Lives Matter movement.
Fast forward, December 4, 2024. UnitedHealthcare CEO Brian Thompson is also murdered on a sidewalk in broad daylight, this time in Manhattan. Accused assailant Luigi Mangione is in custody, with an evidence trail that includes his manifesto and shell casings inscribed with “Deny,” “Defend,” “Depose”.
What do these events have in common? A violent event that fixed a razor-sharp spotlight on the need for systemic solutions to painful, long-standing problems.
A reckoning
It was well-known, long before the pandemic, that 80% of healthcare outcomes are based on social drivers. It is also well-known that U.S. healthcare is a profit-driven, patchwork system in desperate need of reform. These reforms must answer key questions: How can healthcare be accessible, affordable, and equitable while leading to better outcomes?
Though these questions have never stopped, they’ve been swirling anew for more than a quarter now, the unit of time the market uses to measure value. The preference for short-term ROI over long-term investment and solutions begs another question:
Will post-Brian Thompson proposals last or will they suffer the fate of another call for change instigated by violence: the once-amplified, now-waning commitment to Diversity, Equity and Inclusion (DEI) following the death of George Floyd.
The question might suggest that healthcare reform is also waning. Far from it. But what’s next? How can the nature of systems change help us predict it?
Health plans respond to the death of one of their own
Thompson’s murder has sparked significant discussion on how to solve the industry’s systemic challenges. Proposals range from eliminating employer-sponsored insurance (Oscar Health CEO Mark Bertolini) to curbing one of healthcare’s biggest hobgoblins: prior authorization (PA).
The first reform came the day after Thompson’s murder. Facing backlash, Anthem Blue Cross Blue Shieldreversed a policy that would have limited anesthesia coverage based on arbitrary time limits.
UnitedHealth Group: “The health care system is flawed. Let’s fix it.”
UnitedHealth Group CEO Andrew Witty acknowledged public outrage with America’s broken healthcare system in a Dec. 13, 2024, op-ed in The New York Times.
“[T]the health system does not work as well as it should, and we understand people's frustrations with it. No one would design a system like the one we have. And no one did. It's a patchwork built over decades."
Witty expanded on these comments in the company’s Q4 2024 earnings call, noting that there are “so many areas that can be enhanced, reworked, reengineered, or even scrapped to make the health system work better.” He highlighted three:
Enhancing and standardizing AI/digital tools to improve healthcare navigation, data collection, and value-based care (VBC) delivery
Ensuring 100% pass-through of PBM rebate discounts to health plan members
Speeding up approvals “to materially reduce the overall number of prior authorizations used for certain Medicare Advantage services”
A Forbes contributor piece has called for United to compete “on health, not denials” and to “lead the future of healthcare” in three areas:
Capitated (“fixed”) provider payments
Primary and preventive care
Advanced chronic disease management through generative AI
One of UnitedHealth Group's most recent reforms is to end PA requirements for home health services managed by Home & Community, a post-acute healthcare services company owned by its Optum business. The change applies to MA and Dual Special Needs Plans (D-SNP) in 36 states and the District of Columbia and became effective Apr. 1, 2025.
The Cigna Group: “We owe it to our customers to make the health care system work better”
Easier Access to Care: Making customer processes “simpler, easier and faster.” PA is one of these process categories. Here, Cigna is “accelerating and simplifying” provider claim and PA requests by expanding digital options that help ensure completeness and accuracy at point of submission. Noting that "more can be done to reduce the administrative burden on clinicians,” a Cigna representative added that PA “is required for less than 4% of services for Cigna Healthcare customers” and that the company “has removed the prior authorization requirement for about 1,100 services and devices” since 2020.
Delivering Better Value: Making prescription drug costs more predictable and implementing more tools to resolve claims/PA challenges. Examples include enhancing existing digital status trackers and — per a Cigna media representative — engaging with clinicians “to align on care delivery goals and outcomes and continue to evaluate whether there are other changes we can make without compromising patient safety.”
Better Support: Doubling the number of My Personal Champions, who help customers with more complex needs navigate the healthcare system.
Accountability: Implementing “governance processes at the highest levels to successfully ensure positive changes.” This will include tying leadership compensation to customer satisfaction and creating a new Office of Excellence and Transformation (OET).
Transparency: Sharing how The Cigna Group “is continuously improving” via an annual Customer Transparency Report.
Cigna has announced what appears to be the most detailed public reform plan so far: “Let’s Make It Better”SM. Its goal is to regain trust “through the results people will see” per Dr. David Brailer, Cigna Health Group’s EVP and Chief Health Officer, who will oversee the OET.
Cigna should be commended. If reform efforts aren’t met with optimism — albeit cautious and supported with results — they will be undermined by cynicism. When asked ‘Why now?’ on its reforms, a Cigna representative noted that CEO David Cordani’s had addressed this question on the company’s Q4 2024 earnings call:
“In early December, we were all witnesses to the tragic murder of Brian Thompson, a leader at the UnitedHealth Group. The past several weeks have further challenged us to even more intensely listen to the public narrative about our industry. At the Cigna Group, we are further accelerating improvements in innovations to increase transparency, expand support and drive even greater accountability.”
This returns us to the original question. Will commitments to post-Brian Thompson reforms persist? Or will they go the way of other reforms instigated by tragedy?
Cost shares have as much as doubled as plans get a payment rate hike.
A new analysis by eHealth of more than 250,000 applications submitted during the 2025 Medicare Advantage (MA) Annual Enrollment Period found that plan deductibles have more than doubled ($315 vs. $132). In addition, Medicare Part D premiums are also 24% higher than the 2024 plan year. The first and one of the largest health insurance exchanges in the U.S.
Meanwhile, it's Christmas in April for MA insurers, who will receive a 5.06% increase ($25 billion) in the average MA plan benchmark payment in 2026. This increase — finalized April 7 via CMS's Rate Announcement — is higher than the 4.33% increase ($21 billion) proposed at the tail end of the Biden-Harris Administration.
This Tale of Two Cities for members and payers comes as the industry responds to the Rate Announcement and CMS issues additional MA guidance on risk adjustment, Star Ratings, GLP-1 coverage for weight loss.
Rate increase reactions unsurprising
Responses to the Rate Announcement largely followed "party lines" across payers and providers.
Analysts note that the payment increases will help payers expand benefits along with profitability, with the stock prices of publicly traded insurers (UnitedHealth Group, Elevance Health, CVS Health) rising from 6-19% after the announcement.
Conversely — and even before the final Rate Announcement — AMA president Dr. Bruce A. Scott, MD lamented the plan payment increase "while physicians are in their fifth consecutive year of payment cuts."
"The stark contrast between highly profitable insurance companies that are receiving annual payment increases above inflation and physicians," Scott added, "ought to raise eyebrows of policymakers and taxpayers — as it has for physicians."
Plan rate increases amidst a bevy of new MA guidance
Paired with his eHealth's MA member cost-sharing analysis, CEO Fran Soistman added:
"Over the past two years, CMS rate adjustments for Medicare Advantage have not kept up with medical cost inflation or the pent-up demand for healthcare following COVID. That's why enrollees are being asked to take on significantly higher out-of-pocket costs, as our new report shows."
Soistman's quote came prior to the CMS Rate Announcement, and he is bullish on the Medicare Advantage program under CMS's new Administrator, Dr. Mehmet Oz.
"It's too early to say what the future holds for Medicare Advantage but Dr. Oz has been a vocal supporter of the program," says Soistman, adding: "Medicare Advantage is burdened by significant regulations and we look forward to a period of positive change."
An eMed media representative clarified that eHealth "is not against CMS targeting bad actors and supports anything that truly protects consumer interests." CEO Soistman has expanded on this position, noting that not all licensed agents and independent brokers are created equal.
Select agent and broker market guardrails were one of many requirements CMS deferred when finalizing another Medicare Advantage regulation, the Contract Year 2026 MA and Part D rule, including:
most proposed Star Ratings changes
artificial intelligence oversights
coverage of GLP-1s for weight loss by Medicare Part D plans and Medicaid
In line with the Trump Administration's anti-DEI policies, CMS announced that the name of the MA Star Ratings Health Equity Index will change to Excellent Health Outcomes for All (EHO4all) and that its current reward factor will be removed.
CMS giveth and taketh away
The Rate Announcement did, however, continue phase-in of the MA risk adjustment model, which most insurers requested be paused.
As HealthLeaders examined last fall, CMS changed the algorithm that assigns diagnostic codes to address coding variability across MA payers. Depending on new data and analysis — including demographics like age and gender — payments for conditions like heart disease might be higher or lower (overall and compared to MA).
"This is so health plans don't just pick healthy people who cost less as members," noted KFF Associate Director-Program on Medicare Policy, Jeannie Fuglesten Biniek. "The plans get higher payments for people who are sicker."
Coding manipulation to increase reimbursement from CMS is a private payer strategy, which Fuglesten Biniek described as plans receiving "higher payments than are justified and from a payment system that is set up to incentivize this because CMS pays more for people who are sicker."
What's next for MA plans under the Trump Administration?
Medicare Advantage plans are likely to find a friend in Trump's second term, perhaps from policies detailed in Project 2025 from conservative think tank the Heritage Foundation.
For Medicare Advantage, Project 2025 proposes "critical reforms [that] are still needed to strengthen and improve the program" such as making MA the default enrollment option when beneficiaries age-in to Medicare coverage and removing "burdensome policies that micromanage MA plans"
Forbes notes that while Trump "has publicly disavowed Project 2025 and has not changed his stance since taking office," his first months in office "have featured a slew of executive orders that reflect proposals outlined in the policy blueprint."
