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February 2018

February 23, 2018

The Trump administration issued a new regulation on Tuesday to expand the duration of short-term health insurance plans significantly. Under the Obama administration, these plans were defined as having a duration of three months or less and did not have to be compliant with the requirements of the Affordable Care Act (ACA). The intent was that these plans could be used to fill a gap in coverage from sudden or unforeseen circumstances. The proposed rule issued by the Trump administration would lengthen the duration of these plans to one year. Critics argue that the availability of these non-ACA compliant plans will undermine the ACA marketplaces as these plans do not have to cover pre-existing conditions and can benefit limitations. The Trump administration touts the fact that having these plans in the market will give consumers greater choices and lower the cost of insurance. There is a 60-day comment period on the proposed regulation.

Data was released this week on the uninsured population in 2017. Despite all the rhetoric and debate over the ACA last year, the levels of insured people remained constant between 2016 and 2017. The coverage levels may be explained by the fact that most people made their decisions about buying a plan on the exchanges in 2016 before the debate over the fate of the ACA really gained traction in 2017.

  • Trump Moves to Relax Rules on Cheaper Health Insurance – New York Times (Feb 20)
    “The move carries out an executive order by President Trump, who said the change would benefit consumers because “short-term, limited-duration insurance is exempt from the onerous and expensive insurance mandates and regulations” in the Affordable Care Act. Alex M. Azar II, the new secretary of health and human services, said the proposed rules would provide additional options to people who could not afford to pay current insurance premiums.”
  • Spending deals signal end of unpopular Obamacare cost checks – Politico (Feb 19)
    “Republicans and Democrats finally found something they can agree on about Obamacare: killing unpopular policies that were supposed to pay for the law or reduce health costs. The recent congressional spending deals repealed or delayed several Obamacare taxes, as well as a Medicare cost-cutting board. Removing those powerful levers, which terrified health providers and unions, is not a good omen for efforts to control health spending, which is expected to surge in the next few years.”
  • Trump IRS seeks millions in Obamacare fines even though law is ‘dead’ – Politico (Feb 20)
    “Hundreds of companies face prospective fines for violating Obamacare’s employer mandate by the same Trump administration that has done virtually everything in its power to abolish the federal health care law. Internal Revenue Service notices recently began arriving in corporate mailboxes, in some cases demanding millions of dollars in fines — an awkward development as the White House touts its business-friendly tax package. The notices will likely spur another legal fight over the health law — this time featuring the administration defending a statute that President Donald Trump has repeatedly declared dead.”
  • Health chief exploring more actions on high drug prices – The Hill (Feb 21)
    “Health and Human Services (HHS) Secretary Alex Azar says his department is working on additional proposals aimed at high drug prices, including some that could be enacted without congressional action. In an interview with WTHRin Indianapolis on Tuesday, Azar pointed to the proposals to Congress on drug pricing that the administration made in its budget this month, but also said the department is working on other proposals that might not need congressional approval.

February 16, 2018

This week saw HHS Secretary Alex Azar pound the pavement around the Hill to defend and discuss the department’s section of the President’s FY 2019 budget request. HHS’s full request with addendum totaled $93.895 billion; this includes a $9 billion boost to National Institutes of Health (NIH) funding and a $10 billion increase for programs targeting mental health and opioid treatment and recovery. The budget would also eliminate the Low Income Home Energy Assistance Program (LIHEAP), which the President has characterized as a program known for having “sizeable fraud and abuse”, and would consolidate the Agency for Healthcare Research and Quality (AHRQ) within NIH.

The Administration also said that the request includes provisions that would take on the high cost of prescription drugs, namely one that would hold insurers accountable for more of the cost of prescription drugs than the federal government, and another that would encourage the prescription of cheaper generic drugs instead of the pricier brand drugs. Azar faced several questions on these in committee hearings from concerned lawmakers on both sides of the aisle about whether the provisions would actually lower the list prices for prescription drugs. His answers did not appear to satisfy the committees, but the subject of lowering list prices has been a top talking point of Azar’s. Should these provisions be enacted and list prices be unaffected, one would expect Azar’s HHS to continue to try and find a solution.

  • Drug industry scrambles after rare loss in budget deal – The Hill (Feb 14)
    “Pharmaceutical companies are pushing to repeal or roll back a provision in last week’s budget deal that delivered a rare loss to their industry, according to two lobbyists familiar with the situation. A provision included in the budget deal approved last week raised the share of costs that drug companies have to pick up as part of closing the “donut hole,” a gap in drug coverage for Medicare Part D beneficiaries. Drug companies are quickly mobilizing to try and undo the change, or at least roll it back in some fashion. The most likely avenue is the long-term government funding bill that Congress is expected to pass in March, the lobbyists said. “
  • Analysis: Trump budget tries to address drug prices, but leaves list prices untouched – STAT (Feb 12)
    “President Trump’s plan to bring down the price of prescription drugs, released as part of his administration’s budget proposal Monday, made no mention of what his health secretary said is the “most important thing”: lowering the actual list prices drug makers set for their products. Instead, the proposals are a hodgepodge of relatively narrow policies that take aim at various parts of the Medicare and Medicaid programs. One would reduce the amount of money doctors and hospitals are reimbursed for hospital-administered drugs under Medicare Part B; another would let some states engage in more aggressive negotiation for drugs in their Medicaid programs. Others take aim at a drug discount program for hospitals and at seniors’ out-of-pocket spending.”
  • How one conservative state is flouting Obamacare – Politico (Feb 14)
    “The Republican-led state has a maverick plan to flout the federal health care law, letting insurers sell plans that don’t meet Obamacare coverage rules and patient protections. And the brazen move — Gov. Butch Otter is plowing ahead on his own, without seeking federal waivers or permission — poses a test for the Trump administration.”
  • S. spending on drugs will grow faster than on other health-care services over the next decade – Washington Post (Feb 14)
    “Prescription drug spending will grow faster than any other major medical good or service over the next decade, according to a projection from the Centers for Medicare and Medicaid Services. The analysis, published in the journal Health Affairs, estimates that by 2026, national health spending will climb to $5.7 trillion, or nearly a fifth of the economy. Prescription drug spending is forecast to grow at 6.3 percent per year, on average, between 2017 to 2026.”

February 9, 2018

While the federal government was technically shut down for a few hours last night and early this morning, there was very little fallout from it. The Office of Management and Budget (OMB) did not order agencies to shut their doors because the funding bill, while delayed, was soon to arrive on the President’s desk.

A significant number of healthcare provisions accompanied the continuing resolution keeping the government open until March 23rd. In fact, the health provisions took up the most pages in the bill that was eventually passed by Congress.

The bill reauthorizes the Children’s Health Insurance Program (CHIP) for an additional four years. This was mainly done as a pay-for for other provisions in the bill. Medicare extenders were included retroactive to January 1st. This was a big deal as providers and patients were starting to feel the squeeze. Senator Hatch’s chronic care bill – S.870, the Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act – was also included; another impressive win for the retiring Senator who continues to build out his strong legacy.

Also of note was the repeal of the Independent Payment Advisory Board (IPAB), a controversial creation by the Affordable Care Act that acquired the pejorative “death panel” that would have recommended to Congress ways to cut costs in Medicare. IPAB, however, was never even formed as funding for the program never hit the threshold it required.

  • NIH and opioid response get boost in Senate budget deal – STAT (Feb 7)
    “Senate leaders on Wednesday announced a bipartisan budget agreement that would increase funding for the National Institutes of Health by $2 billion and raise spending meant to address the opioid and mental health crisis by $6 billion over the next two years. The White House endorsed the agreement during its announcement on the Senate floor. The House is likely to pass it with few changes, staving off another government shutdown or continuing spending resolution that had loomed if no agreement was reached.”
  • Trump uses Britain’s protests to jump back into health-care fray at home – Washington Post (Feb 6)
    “Though congressional Republicans agreed last week to back off the contentious politics of the Affordable Care Act this year, President Trump began Monday morning by stirring the health-care policy pot anew. In a tweet shortly after 7 a.m., the president lashed out at Democrats, saying they “are pushing for Universal HealthCare while thousands of people are marching in the UK because their U system is going broke and not working.””
  • Trump administration approves second Medicaid work requirement, for Indiana – Politico (Feb 2)
    “Health and Human Services Secretary Alex Azar on Friday granted Indiana permission to add work requirements to its Medicaid program, making it the second state to tie health coverage to employment for certain low-income enrollees. Azar, days after being sworn in, touted the work requirement plan as an innovative approach to boosting employment and lifting poor adults out of poverty.”
  • How three of America’s biggest companies might undo decades of conservative health-care policy – Washington Post (Feb 8)
    “Last week, Amazon, Berkshire Hathaway and JPMorgan Chase announced they would form an independent health-care company to serve their combined 1.2 million employees. Most commentators focused on the futuristic aspects of the project: “Technology solutions” that might, someday, help control the spiraling health-care costs Berkshire Hathaway Chairman and chief executive Warren Buffett described as “a hungry tapeworm on the American economy.” … The three companies seem to envision a private, nonprofit insurance company for their employees. Radical as that may sound, the idea reflects a concept that actually has a long history in the United States.”

February 2, 2018

In his State of the Union speech on Tuesday night, the President touted the fact that the FDA approved the most drugs, genetics, and devices than it had in any previous year. The President also urged Congress to allow terminal patients access to experimental drugs, and renewed his pledge to lower prescription drug prices. He did not, however, offer specific policy proposals for drug prices, and merely stated that he has directed his administration to tackle the issue.

Amazon, Berkshire Hathaway, and JP Morgan Chase, led by Jeff Bezos, Warren Buffett, and Jamie Dimon respectively, announced the launching of a company to offer better and more affordable health insurance offerings to their employees. The announced the company would be free from profit-making motives and constraints. With the innovation of the leaders and the deep resources of their companies, this could be a big game changer in the healthcare marketplace. There are some who remain skeptical of their ability to make dramatic changes given the limitations of Health Insurance Portability and Accountability Act (HIPAA) rules.

The Director of the Center for Disease Control (CDC) Brenda Fitzgerald had to step aside after it became known that she had purchased stock in a tobacco company as Director. CDC is the agency charged with smoking cessation efforts and obviously that purchase represented a conflict of interest.

  • Physicians, ethicists urge Congress not to pass ‘right-to-try’ legislation – STAT (Feb 1)
    “Dozens of doctors, medical ethicists, and lawyers are warning Congress that legislation to allow Americans with life-threatening conditions access to unapproved, experimental drugs risks harming patients’ health. The letterwas drafted by Alison Bateman-House, associate professor of medical ethics at NYU Langone Health, along with some of her colleagues. It is addressed to the leaders of the House Committee on Energy and Commerce, the committee currently considering a so-called “right-to-try” bill. The letter was circulated for online signatures on Thursday, and organizers said they planned to send the letter on Feb. 5.”
  • House ACA stabilization bill takes broader approach than Senate – Axios (Feb 2)
    “House and Senate Republicans are increasingly open to the idea of a program that would pump billions of dollars into insurance markets to help stabilize the Affordable Care Act’s exchanges. But they’ll need to reconcile big differences over how much to spend and how much to leave up to states.”
  • Why the CDC director had to resign – Politico (Jan 31)
    “Health and Human Services Secretary Alex Azar had planned to send a clear message to Congress and his new boss in the White House that he would not tolerate ethically questionable behavior. That opportunity came faster than expected after POLITICO reported Tuesday that the director of the Centers for Disease Control and Prevention had traded in tobacco stocks while she led the agency. Less than 48 hours after being sworn in, Azar accepted the resignation of CDC Director Brenda Fitzgerald amid questions about her judgment and conflicts of interest.”
  • Republicans give up on Obamacare repeal – Politico (Feb 1)
    “Though the GOP still controls both chambers of Congress and maintains the ability to jam through a repeal-and-replace bill via a simple majority, there are no discussions of doing so here at House and Senate Republicans’ joint retreat at The Greenbrier resort. Republicans doubt they can even pass a budget providing for the powerful party-line “reconciliation” procedure used to pass tax reform last year, much less take on the politically perilous task of rewriting health care laws in an election year.”
  • Unnecessary Medical Care Is More Common Than You Think – ProPublica (Feb 1)
    “…the Washington Health Alliance, a nonprofit dedicated to making care safer and more affordable, decided to find out. The group scoured the insurance claims from 1.3 million patients in Washington state who received one of 47 tests or services that medical experts have flagged as overused or unnecessary. What they found should cause both doctors and their patients to rethink that next referral.”