President Trump recently issued an Executive Order (EO) announcing an unprecedented commitment to diagnosing, treating, preventing, and curing pediatric cancer using artificial intelligence (AI). This effort will be a game-changer for kids facing a cancer death sentence if we rework how we pay for breakthrough therapies and encourage their development.
The EO directs the MAHA Commission to coordinate efforts across the government and private sector to build on the Childhood Cancer Data Initiative (CCDI), an effort started during the first Trump administration, to accelerate the use of AI and data sharing to speed up discovery, diagnosis, and treatment for pediatric cancers. It will do this by:
- Expanding secure data collection and sharing, while consolidating diverse datasets for AI-ready analysis and smarter clinical trial participant selection
- Using AI to improve predictive modeling and identify new biomarkers from multi-omics and imaging data
- Enhancing trial design and outcomes using multimodal data and AI to improve recruitment, accessibility, and interpretation
- Expanding funding for pediatric cancer initiatives like CCDI, and leveraging private sector technologies, especially AI, to pursue cures
Ultimately, the goal is to improve outcomes for kids and ultimately cure cancer. This year, it’s estimated that more than 9,000 children in the United States will be diagnosed with cancer. When we consider all age groups, the numbers are staggering- in 2025, more than two million Americans are expected to be diagnosed with cancer, and more than 618,000 lives will be lost. That is 1,700 deaths every day. This shocking number underscores the urgency of advancing both medical innovation and care delivery models that put patients first.
The past decade has brought tremendous progress in cancer treatment. Survival rates continue to improve, with nearly seven in 10 people diagnosed between 2014 and 2020 living at least five years past their diagnosis. But progress has come at a cost. The National Cancer Institute estimated cancer-related medical spending at nearly $209 billion in 2020. Patients were responsible for more than $21 billion in direct costs, including $16.2 billion out-of-pocket. It is not uncommon for patients to spend between $1,000 and $20,000 each year. The average treatment in 2018 reached $150,000. Chemotherapy alone can cost between $1,000 and $12,000 per month, and many new drugs far exceed those levels. In 2022, the average new cancer drug was $283,000 per year, a 53 percent increase from 2017.
While science has become more sophisticated, the economics of care are quickly outpacing what patients, families, and the healthcare system can sustain.
Creating Incentives to Cure Pediatric Cancer
The traditional fee-for-service model is not equipped to meet this challenge. Paying manufacturers and providers based on the number of treatments and services delivered, rather than the outcomes achieved, has created fragmentation, redundancy, and inefficiency that compound the financial and emotional toll of cancer. The answer is not to do more of the same, but to reimagine how we deliver and pay for care. That is why value-based care and value-based purchasing agreements (VBPs) are not just options in oncology; they are a necessity.
While value-based care focuses on the relationship between costs, patient outcomes, and satisfaction through provider incentives (rewards and penalties), VBPs are innovative agreements between insurers or payers and prescription drug manufacturers that tie payments to clinical outcomes. If the therapy is not effective for a patient, the manufacturer reimburses the payer. These arrangements create powerful incentives to target the best therapy for each patient using advanced diagnostics and medication adherence strategies, especially for costly but curative therapies. They are also an important innovation to address rising healthcare costs, particularly for specialty drugs. Tying reimbursement to a patient’s recovery, instead of the amount of medication taken, is a commonsense solution to rising drug costs, and a game-changer for those battling cancer.
Two primary things have held back value-based payment arrangements: administrative complexity and federal rules.
The Promise – and the Stall
The U.S. Centers for Medicare & Medicaid Services (CMS) tried to accelerate VBPs by loosening “best price” rules in 2020 to permit multiple outcomes-based prices and allowing coordination across actors without violating fraud laws. In 2022, CMS issued technical instructions to states on data collection/reporting under these VBPs (i.e., this is allowed, but it’s still paperwork-heavy). A 2023 Avalere survey found that just over half of payers (58%) had any outcomes-based contracts at all, and most only had one or two. The enthusiasm exists, but the economics don’t make sense – yet.
There are four main reasons:
- Regulatory gray zones persist – Even after updates by the U.S. Department of Health and Human Services Office of the Inspector General, manufacturers still sit outside the main “value-based enterprise” safe harbors. Medicaid’s multiple-best-price flexibility helps, but the required tracking, reporting, and audit controls are punishingly detailed. And regulators could change their minds and the rules in the middle of multi-year contracts. Regulatory risk and complexity kill market innovation daily.
- Pediatric cancers are uniquely hard –Pediatric value-based care lags because standardized outcome measures are sparse, and common metrics skew to process (e.g., HEDIS) vs. outcomes tied to a specific drug. Additionally, pediatric oncology has small populations, complex diseases, and long follow-up windows, which makes outcomes adjudication slow and statistically fragile.
- Administrative burdens –Setting up, running, and reconciling a VBP requires linking claims and electronic health records data, extracting outcomes, and manually adjudicating results. Many agreements are literally managed on spreadsheets and emails. Every new contract is a “project,” not an automated process.
- Incentive misalignment and thin ROI evidence –Traditional rebate structures, Pharmacy Benefit Manager spreads, and uncertain savings make it hard for stakeholders to justify upfront complexity and costs.
Where the EO and Congress Meet
To fix these problems, Congress should pass the Medicaid Value-Based Payments for Patients (MVP) Act. The bill was introduced in the Senate earlier this year by Senators Markwayne Mullin (R-OK), Tim Scott (R-SC), and Maggie Hassan (D-NH), and previously championed in the U.S. House of Representatives by Energy and Commerce Committee Chair Brett Guthrie. The bill would codify CMS’s authority to allow multiple best prices for VBPs and extend that flexibility to states. It would give manufacturers and payers confidence that value-based deals won’t backfire under federal pricing law and that the rules of the game won’t change mid-project.
In terms of the EO, as the MAHA Commission coordinates efforts, it should drive AI solutions across value-based payment arrangements. If the hidden tax on VBPs is administrative overhead, AI is the rebate.
The table outlines the challenges and improvements AI can make.
Pairing AI-driven infrastructure – such as standardized outcomes, automated reporting, interoperable data – with the legal clarity from the MVP Act and the VBP market could finally scale.
This new era of health care will be led by technology, but technology without value is worthless. Real progress means ensuring that cancer care is effective, compassionate, and rewards effective, high-value interventions, especially for our youngest patients.