Health Care Matters | January 23
Congressional Health Funding Package Extends Advanced APM Incentive and Key Medicare Policies
A bipartisan health funding proposal unveiled in the House as part of the Consolidated Appropriations Act, 2026 would extend several expiring Medicare policies while reviving incentives designed to support participation in value-based care. Most notably, the proposal includes an extension of the Advanced Alternative Payment Model (APM) incentive, providing an additional 3.1% incentive payment and a freeze of qualifying participant (QP) thresholds for performance year 2026/payment year 2028. This follows Congress’s decisions not to extend the APM bonus or prevent higher QP thresholds from taking effect for PY 2025/PY 2027. The package also extends Medicare telehealth flexibilities through December 31, 2027, hospital-at-home waivers through September 30, 2030, and introduces new oversight and transparency requirements for pharmacy benefit managers (PBMs) as part of the broader FY 2026 HHS appropriations framework. Read more here and here.
Why It Matters
The extension of the Advanced APM incentive is a significant signal of congressional intent to maintain strong financial incentives for clinicians to modernize care delivery within value-based models. As NAACOS noted, the incentive and threshold freeze help retain momentum toward care models that improve patient outcomes while reducing costs, particularly when paired with the higher conversion factor already available to qualifying participants beginning in CY 2026. The accompanying telehealth and hospital-at-home extensions further support flexible, patient-centered care delivery. Together, these provisions provide near-term stability for ACOs and other value-based entities, while underscoring the need for a longer-term, sustainable approach to physician payment reform to support continued transition to high-value care.
JPM26 Highlights Health System Focus on AI, Performance, and Operational Discipline
Reporting from the 2026 J.P. Morgan Healthcare Conference underscores a shift in how health systems are approaching technology and growth amid continued financial pressure. Health system leaders emphasized more disciplined deployment of artificial intelligence, with a focus on integrating AI into clinical workflows, revenue cycle operations, and analytics rather than pursuing broad or experimental pilots. Conference discussions also reflected a broader emphasis on operational performance, cost management, and selective investment, as systems balance margin recovery efforts with longer-term strategic priorities, including outpatient growth and digital enablement. Read more here and here.
Why It Matters
The JPM26 takeaways point to a maturation phase for health system strategy, where AI is increasingly viewed as an operational tool rather than a standalone innovation initiative. As highlighted in both Modern Healthcare and Advisory Board coverage, organizations are prioritizing technologies that can deliver measurable efficiency gains, support care teams, and strengthen performance in a constrained reimbursement environment. For health systems and value-based care organizations, this signals growing alignment between technology investments and accountability for outcomes, cost, and operational sustainability. Successfully realizing these benefits will depend not only on technology selection, but on governance, workflow integration, and alignment with payment models that reward performance and efficiency over volume.
Look for the Helpers: Supporting Family Caregivers Through Paid In-Home Care
Ohio is launching a new program that compensates family members for caring for loved ones at home, recognizing the critical role informal caregivers play in supporting aging and disabled individuals. By providing monthly payments through Medicaid-supported pathways, the initiative helps families sustain in-home care, reduce financial strain, and avoid unnecessary institutionalization. This approach highlights how targeted policy changes can strengthen home- and community-based care while valuing caregiving as essential work. Read more here.
New Resource
A Practical Guide to Launching a Strong MSSP ACO
Launching a new MSSP ACO requires careful early planning across performance, compliance, and quality reporting. Our latest eBook provides a practical overview of the key considerations new ACOs face as they move from application into their first performance year under the Medicare Shared Savings Program. Drawing on experience supporting emerging ACOs, it outlines foundational decisions related to governance, data readiness, compliance activities, and reporting approaches that help organizations establish a stable and effective PY1 foundation. Download here.
What We Are Reading
Growth in National Health Expenditures: It’s Not the Prices, Stupid
A new Health Affairs article argues that recent growth in U.S. health spending is being driven more by increased utilization and intensity of care than by prices, with important implications for affordability and policy reform. Read here.
Paying the "Tech Tax"
A new PEPC and West Health brief highlights that physician-led ACOs and independent practices often bear disproportionately high costs for data access and technology infrastructure, creating a “tech tax” that can constrain their ability to scale success in value-based care and prompting calls for policy action to reduce barriers and improve data exchange. Read here.
Advancing Medicaid Primary Care Through Population-Based Payment Models
A new brief from the Center for Health Care Strategies outlines four key lessons for states implementing population-based payment models in Medicaid primary care, emphasizing alignment of incentives, data infrastructure, provider engagement, and equity considerations to drive better outcomes and cost management. Read here.
What We're Attending
2026 CMS Quality Conference
Registration is now open for the CMS Quality Conference, taking place March 16–18 in Baltimore and virtually. The conference will bring together HHS, CMS, and national health care leaders, including CMS Administrator Mehmet Oz, to explore innovation and collaboration around quality, performance, and better health outcomes. Register here.
The Future of Accountable Care
Registration is open for a virtual event on January 27 hosted by Health Affairs that will explore the future of ACOs and innovations in value-based care. The event will feature national experts and thought leaders, including Coral ally Hope Glassberg of Decipher Health, in discussions about how policy, payment models, and delivery innovation are shaping the next chapter of accountable care. Register here.
Pop Health Podcast
New Model Mania: Unpacking CMS's RHTP, ASM, LEAD, ACCESS, and ELEVATE
In the latest episode of the Pop Health Podcast, we break down CMS’s expanding portfolio of payment and delivery reform models, from the Rural Health Transformation Program and the Ambulatory Specialty Model to the new LEAD and ACCESS initiatives and the emerging ELEVATE framework, and discuss what these shifts mean for providers, payers, and health care leaders navigating value-based care in 2026 and beyond.