CMS Keeps Pushing Medicare Toward Value-Based Care. Optum's CEO Says the Signals Are Getting Hard to Ignore

Medicare has spent over a decade trying to stop paying doctors for how much care they deliver and start paying them for how good that care is. The Centers for Medicare & Medicaid Services is now signaling, again, that it's serious about finishing the job.

Krista Nelson, CEO of Optum Health, laid out where she thinks this is headed during a Newsweek webinar on August 17. Optum Health is one of the largest physician organizations in the country, so when its CEO says CMS wants "every Medicare eligible" person to have access to value-based care, that's not a small claim.

"I think CMS' intention and their goal is that every Medicare eligible [person] has access to value-based care," Nelson said. She added that CMS doesn't want this limited to Medicare Advantage. The agency's vision, according to Nelson, includes traditional fee-for-service Medicare too.

What CMS Has Actually Done

This isn't just talk. Starting in 2026, doctors who participate in Advanced Alternative Payment Models get a bigger annual bump in the Medicare Physician Fee Schedule than doctors who don't: 0.75 percent versus 0.25 percent. That's a real financial incentive built into the system, not a suggestion.

The CMS Innovation Center has also said it wants future payment models to expand prospective payments and shared savings arrangements that push providers toward taking on "global downside financial risk." Doctors and hospitals eat more of the cost if care runs over budget, and keep more of the savings if it doesn't.

Last month, CMS proposed changes to the 2027 Medicare Physician Fee Schedule that would expand participation in accountable care organizations and move clinicians away from the traditional Merit-based Incentive Payment System, or MIPS, toward more meaningful value-based reporting.

More than 700,000 health care providers and organizations are already participating in Medicare accountable care initiatives in 2026, according to figures cited in the Newsweek report.

The Case For It, and the Case Against It

The argument for this shift is straightforward and has bipartisan roots going back to the Affordable Care Act's push for accountable care organizations. Fee-for-service Medicare pays for volume: more visits, more scans, more procedures, regardless of whether the patient actually gets healthier. That's an incentive structure that drives up costs without necessarily improving outcomes. If CMS can pay for results instead, taxpayers and patients both win.

There's a legitimate counterargument. Critics of value-based care, including physician groups that have pushed back on aggressive MIPS reporting requirements, argue these programs pile new administrative burdens onto doctors, especially small and independent practices that lack the staff to manage complex risk-sharing contracts. There's also a real concern that "downside risk" models can pressure providers to under-treat sicker, more expensive patients to protect their margins. CMS has not, in the material reviewed here, published data proving that its expanded accountable care push has produced clear net savings or better outcomes at scale. The claim that this transition improves care is the agency's stated goal, not yet a demonstrated result.

Nelson's comments reflect the perspective of an executive whose company profits from managing these very arrangements. Optum Health, part of UnitedHealth Group, has built a business model around accountable care and value-based contracting. That doesn't make her wrong about where CMS is heading, but it's a reason to treat her framing as that of an interested party, not a neutral referee.

What Happens Next

CMS's 2027 Physician Fee Schedule proposal is still in the proposal stage. It has not been finalized, and the public comment period and eventual final rule will determine exactly how far the agency pushes providers away from MIPS and toward these newer models.

The bigger unresolved question is whether the 700,000-plus providers already in Medicare accountable care arrangements are actually delivering better, cheaper care, or whether they're mostly absorbing new reporting requirements without materially changing how medicine gets practiced. CMS has not released independent, audited outcome data settling that question. Until it does, the shift Nelson describes remains a policy direction, not a proven success.