Trump Signs ‘Right to Try’ Drug Bill

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Source: The Hill

President Trump signed a bill Wednesday allowing terminally ill patients access to experimental medical treatments not yet approved by the Food and Drug Administration (FDA).

Dubbed “right to try,” the law’s passage was a major priority of Trump and Vice President Pence, as well as congressional Republicans.

“Thousands of terminally ill Americans will finally have hope, and the fighting chance, and I think it’s going to better than a chance, that they will be cured, they will be helped, and be able to be with their families for a long time, or maybe just for a longer time,” Trump said at a bill signing ceremony at the White House, surrounded by terminally ill patients and their families.

Trump thanked lawmakers sitting in the audience who sponsored the bill, including Sen. Joe Donnelly, a vulnerable Democrat up for reelection in Indiana.

Despite calling Donnelly a “really incredible swamp person” earlier this month, Trump thanked the senator for his work on the bill.

Sen. Joe Manchin (W.Va.), another vulnerable Democrat up for reelection, was the only other Democratic co-sponsor on the bill, but did not attend the ceremony because he is in West Virginia this week, his office said.

Congress is on recess this week for Memorial Day.

Most Democrats and public health groups oppose the bill, arguing that it could put patients in danger.

“FDA oversight of access to experimental treatments exists for a reason — it protects patients from potential snake oil salesmen or from experimental treatments that might do more harm than good,” said Rep. Frank Pallone Jr. (D-N.J.), ranking member of the House Energy and Commerce Committee.

Opponents also argue it gives “false hope” to patients, since drugmakers aren’t required to give unapproved medicines to patients who ask for them.

Supporters say, however, it will provide new treatment opportunities for terminally ill patients who have exhausted existing options.

“While a long time coming, today is a monumental win for patients desperately seeking the ‘right to try’ investigational treatments and therapies,” said Energy and Commerce Committee Chariman Greg Walden (R-Ore.) and health subcommittee chairman Michael Burgess(R-Texas).

“With ‘right to try’ being the law of the land, we are confident that the Trump Administration, and FDA Commissioner [Scott] Gottlieb, will take both congressional intent and the safety of patients into consideration when implementing this important law.”

Trustees: Medicare Exhausted in 2026

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Source: Politico

Medicare’s trust fund will start running out of money in 2026, two years later than the program’s trustees estimated last year as the trend toward slower spending continues.

And here’s a fact that puts an exclamation point on that trend: This year, for the first time ever, the government expects to spend less money per Medicare beneficiary than it did the year before, in part because of the sequester.

The trustees in the annual report noted that the long-term challenges to the program remain as the massive baby boomer population heads into retirement. They called on Congress to address Medicare’s troubled finances “as soon as possible.”

But the looming crisis is less imminent.

Medicare and other entitlement spending will remain hot buttons in the coming fight over the budget and the debt ceiling, but the spending slowdown will help keep the lid on one political flash point at least: the hugely controversial Independent Payment Advisory Board.

Based on the new report, the chief Medicare actuary concluded that Medicare spending won’t trigger action from the controversial panel, which is tasked with curbing the program’s costs if they run too high, through at least 2015.

Administration officials said the improved outlook reflects changes in health care spending as well as policies put in place under President Barack Obama’s health law.

“The Medicare report demonstrates, once again, the importance of the Affordable Care Act, which has strengthened Medicare’s finances by reining in health care costs,” Treasury Secretary Jack Lew said. Indeed, the trust fund has been extended by nine years since the health reform law passed.

But Medicare trustee Robert Reischauer warned against seeing this year’s report as a significant development for Medicare, saying, “I think that such an interpretation would be a mistake.”

He said the “discipline” in the federal health care law is partly responsible for the slowdown in spending in addition to the country’s broader economic problems, but sustaining the trend will require concerted effort in the public and private sectors that is anything but guaranteed.

Congress must make “unavoidable adjustments” for cost savings beyond what’s in the Affordable Care Act, and the sooner it acts, the less disruptive those changes will be, he said.

Health care providers must become more efficient, and employers, labor unions, insurers and others must pitch in to reinforce the transformation of the health care payment system begun in the federal health care law, Reischauer said.

Short Term Plans and Association Health Plans Panned in Submitted Formal Comments

Image result for Short Term Plans and Association Health Plans Panned in Submitted Formal Comments imagesSource: Los Angeles Times

More than 95% of healthcare groups that have commented on President Trump’s effort to weaken Obama-era health insurance rules criticized or outright opposed the proposals, according to a Times review of thousands of official comment letters filed with federal agencies.

The extraordinary one-sided outpouring came from more than 300 patient and consumer advocates, physician and nurse organizations and trade groups representing hospitals, clinics and health insurers across the country, the review found.

Kris Haltmeyer, vice president of health policy and analysis at the Blue Cross Blue Shield Assn., said he couldn’t recall a similar show of opposition in his more than 22 years at the trade group, which represents Blue Cross and Blue Shield health plans and is among the organizations that have expressed serious reservations about the administration’s proposed regulations.

“This seems to be a pretty overwhelming statement of concern,” Haltmeyer said.

State insurance regulators from both political parties have also warned that the administration’s proposals could destabilize insurance markets, raise premiums for sick Americans and open the door to insurance fraud.

And dozens of industry leaders and other experts have called on the administration to rethink moves to scale back consumer protections enacted through the Affordable Care Act, often called Obamacare.

“Basically anybody who knows anything about healthcare is opposed to these proposals,” said Sandy Praeger, a former Republican state insurance regulator in Kansas and onetime president of the National Assn. of Insurance Commissioners. “It’s amazing.”

After the failure to repeal the healthcare law last year, the Trump administration is weighing two controversial new rules to loosen regulations governing health plans. One would expand the availability of short-term coverage plans that last less than a year. The other would make it easier for self-employed Americans and small businesses to band together to form so-called association health plans.

These plans — which administration officials say will be more affordable — would not have to offer the full set of health benefits required under the 2010 law and in some cases could turn away sick customers.

Altogether, more than 95% — or 266 of 279 — of the healthcare groups that filed comments about the proposed association health plan regulation expressed serious concern or opposed it, the Times analysis found.

And more than 98% — or 335 of 340 — of the healthcare groups that commented on the proposal to loosen restrictions on short-term health plans criticized it, in many cases warning that the rule could gravely hurt sick patients.

“As advocates for our communities, we implore you to protect patients and consumers, including individuals with preexisting conditions and persons with disabilities,” a coalition of 106 groups noted in one letter urging the administration to withdraw the proposal.

Among the groups were virtually every leading patient advocate in the country, including the American Lung Assn., the American Heart Assn., the Cystic Fibrosis Foundation, the March of Dimes, the National Multiple Sclerosis Society, Susan G. Komen, AARP and the advocacy arm of the American Cancer Society.

Not a single group representing patients, physicians, nurses or hospitals voiced support in the public comments for the two Trump administration proposals.

Before finalizing proposed regulations, federal agencies typically provide a comment period during which individuals and interest groups can share their opinions. Comment letters are then posted on an agency’s website or on regulations.gov.

A total of 722 comments were posted by the Department of Labor on the administration’s association health plan rule; 9,205 were posted on the proposed short-term health plan rule.

Most of the comments were from individual Americans, many of whom shared concerns about access to health coverage. The Times identified comments from healthcare groups to gauge the opinions of experts who work in the system or advocate for patients.

Officials from 25 states — including insurance regulators, attorneys general and insurance marketplace directors — also submitted comments. Most were highly critical, with the exception of insurance officials from six states who welcomed one or both of the administration proposals.

Several dozen individual healthcare businesses, including insurers, medical systems and benefit consultants, filed comments on the two proposals, offering more mixed views.

Administration officials have said relaxing regulations and allowing more health plans that offer limited benefits or that may exclude sick consumers will provide more options to people who are currently being priced out of the health insurance market.

“We want people to have access to competitive, affordable health insurance,” Health and Human Services Secretary Alex Azar told lawmakers on Capitol Hill recently. “Unfortunately the Affordable Care Act is not delivering on that.”

The healthcare law has helped expand coverage to some 20 million previously uninsured Americans, through the expansion of state Medicaid programs for the poor and through new marketplaces that offer subsidized health plans for low- and moderate-income people who don’t get coverage through an employer.

But the marketplace plans — which must offer a basic set of health benefits and cannot turn away sick consumers — have become more and more expensive, as premiums that began to rise under President Obama have shot up further under the current administration.

That has made coverage increasingly unaffordable for the small share of Americans — perhaps as many as 15 million — who don’t receive coverage from their employers or from a government plan and make too much to qualify for federal marketplace subsidies. The subsidies cut off after about $48,000 for an individual and $100,000 for a family of four.

The Trump administration’s proposals may make some insurance more affordable, largely by allowing plans to skip currently mandated benefits, such as prescription drugs, maternity care, mental health and addiction services.

Short-term plans — which are currently limited to three months but which the administration wants to extend to a year — could also be allowed to turn away sick people. That would allow them to charge even lower rates.

Easing insurance rules has cheered some business groups, particularly those representing small employers and independent workers such as real estate agents and court reporters, which backed an expansion of association health plans.

Several associations representing insurance agents, who can often earn large commissions on short-term health plans, support easing rules on these plans.

“While such plans are clearly not the best option for many Americans, [short-term] plans could expand affordable access to health coverage for certain individuals,” said the Health Agents for America, one of the five healthcare groups writing in support of the Trump administration rule.

The rising cost of health coverage has generated widespread concern among healthcare groups as well, including patient advocates, physicians, nurses, hospitals and health insurers.

But they have cautioned the administration that loosening current rules creates many more problems than it solves.

Many warned that allowing healthier Americans to buy plans that don’t cover expensive medications or other medical benefits will drive up costs for sick patients who have no choice but to buy more costly, comprehensive coverage.

The American Academy of Pediatrics, for example, noted that the administration’s proposal to allow more association health plans “could leave children, particularly children with serious, chronic, or complex medical needs, with less comprehensive coverage and higher out-of-pocket costs.”

The academy was among 16 physician groups — including the American Medical Assn., the American College of Emergency Physicians, the American Academy of Family Physicians and the American College of Obstetricians and Gynecologists — that expressed concerns about the association health plan rule.

They were joined by 10 hospital associations, five nursing groups and 176 patient and consumer advocates who criticized the proposal.

AARP said that the proposal would “greatly increase the likelihood that working Americans, especially those age 50-64, would face higher insurance premiums and loss of access to critical health insurance coverage.”

The outpouring against the proposed short-term rule was even more overwhelming.

Among those who filed critical comments were 233 patient and consumer advocates, 17 physician groups, 30 nursing associations, 11 hospital groups and 41 groups representing other medical providers, such as physical therapists, social workers, physician assistants and multiple sclerosis clinics.

Many sounded the same concern about the unfairness of making Americans suffering from mental illness, cancer, HIV/AIDS or other diseases pay more for coverage.

Mental Health America warned that the short-term plans were “not a realistic option for people with chronic behavioral health concerns.”

And the American Diabetes Assn. said that diabetics would be left with “two undesirable options”: an expensive plan with adequate benefits or a short-term plan “with severely limited coverage and high out-of-pocket costs.”

Many patient advocates, physician groups and others also cautioned that expanding skimpier plans could leave healthier consumers who buy those plans without protection if they got sick, something that happened often before the 2010 heathcare law.

The American Academy of Family Physicians, for example, noted that expanding short-term plans “could subject patients to catastrophic medical bills and medical bankruptcy.”

And the National Assn. of Insurance Commissioners warned that association health plans had a long history of fraud and insolvency that left consumers in the lurch.

These concerns were echoed by the leading health insurance trade groups, as well as many individual health insurers that cautioned that rates would only increase as looser rules further destabilized insurance markets across the country.

The Trump administration has not indicated when it will finalize the proposed new insurance regulations.

Blue States Defy Administration on ObamaCare

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Source: The Hill

Blue states are defying the Trump administration in a bid to protect ObamaCare and keep their insurance markets stable.

Several states, including California and Maryland, are looking to put limits on short-term insurance plans, even as the Trump administration is poised to expand access to them nationwide.

The states are doing so because they fear the availability of the short-term plans will drive up premium costs for ObamaCare.

On another front, Vermont and New Jersey have passed state laws that require people to buy health insurance. These individual mandate laws are meant replace the now-repealed federal requirement.

Advocacy groups and state officials that back the measures say the states are seeking to protect advances made under ObamaCare from attacks by the Trump administration, which sought to repeal and replace the law and, failing that, has tried to chip away at it.

“States are determined to safeguard the gains they’ve achieved,” said Stan Dorn, a senior fellow at the advocacy group Families USA. “There’s a lot of interest in making sure the achievements of [ObamaCare] are not in danger, states protecting their residents from federal sabotage.”

Costs are a big driver in the efforts by states.

The cost of health insurance premiums on the ObamaCare exchanges is projected to jump in the coming weeks and months. Some states could see major double-digit spikes next year.

The high costs are blamed on actions the administration has taken that could cut into ObamaCare’s enrollment.

“There’s been a series of actions taken by the current administration that have undermined enrollment,” Chet Burrell, president and CEO of CareFirst BlueCross BlueShield, said when he announced a potential 26 percent premium increase for next year in Maryland.

The elimination of the individual mandate penalty as part of the GOP tax-reform bill is one of the main drivers of premium increases. So is the expansion of short-term plans that do not meet ObamaCare requirements.

Some efforts by states to fight the administration are easier than others.

Imposing a state individual mandate to replace the federal one might have the most impact, but it’s also the most politically difficult.

“The mandate is not a particularly popular provision. People like the effects that come from it, but asking legislators to vote for [forcing] people to buy insurance is not always attractive,” said Gary Claxton, a vice president at the Kaiser Family Foundation.

Nonetheless, New Jersey’s newly-elected Democratic governor signed a bill on May 30 to impose an individual mandate for health insurance, becoming only the second state to require health-care coverage and impose a penalty on residents without it.

Massachusetts first imposed a mandate in 2006 as part of then-Gov. Mitt Romney’s (R) health reform plan, which served as a model for ObamaCare.

Vermont’s Republican Gov. Phil Scott also signed an individual mandate bill in late May, but it won’t take effect until 2020 and many of the details, including the penalty and enforcement mechanisms, still need to be decided.

Maryland lawmakers discussed passing a mandate law for 2019, but ultimately only passed a commission to study it.

Al Redmer Jr., Maryland’s insurance commissioner, said he was skeptical of the impact an individual mandate would have on premiums.

Redmer said ObamaCare’s mandate was criticized as ineffective because the penalty was too small.

“If that’s true … you’d have to think there’s not much difference between an ineffective one and no mandate,” Redmer said.

It might be easier for states to fight the expansion of short-term insurance plans.

In February, the administration proposed rules that would allow people to buy short-term health insurance for up to 12 months, lifting restrictions from the Obama administration that limited the coverage to a maximum of three months. The plans would also be renewable.

The short-term plans don’t need to meet ObamaCare’s consumer protections, so they would potentially be much cheaper than a traditional plan. But people with pre-existing conditions can be charged more.

In addition, the plans to do not have to comply with ObamaCare mandates for covering certain services, such as mental health treatment or prescription drugs.

Allowing plans to operate outside ObamaCare’s protections will create a “shadow insurance market” that will siphon healthy people away from ObamaCare plans and increase costs, said Dorn.

The final policy is expected to be released in the coming weeks, but some state lawmakers are already pushing back.

California passed a bill that would completely prohibit the sale of short-term plans beginning in 2019, but it has yet to be signed into law.

Lawmakers in Hawaii passed a bill that would essentially eliminate the state’s short-term health plan market by prohibiting their sale to anyone eligible for a plan on the ObamaCare exchange. That bill is also awaiting the governor’s signature.

Maryland’s GOP Gov. Larry Hogan recently signed a bill that limits short-term plans to three months, and prohibits their renewal.

Redmer said he sees the short-term plan bill as merely returning to the status quo. He added that state lawmakers were worried about “adverse selection” if they allowed the administration’s proposal to impact their state.

“The legislature has been protective of citizens,” Redmer said. Lawmakers want to avoid creating situations where the insurance market will be negatively impacted, and “adverse selection will always result in increased premiums.”

Trump Administration Inaugurates Medicaid Scorecard for State Programs

Image result for Trump Administration Inaugurates Medicaid Scorecard for State Programs imagesSource: Washington Post

The Trump administration is embarking on a basic change to Medicaid that for the first time evaluates states based on the health of millions of Americans and the services they use through the vast public insurance program for the poor.

Seema Verma, administrator of the federal Centers for Medicare and Medicaid Services, announced on Monday an initial version of a “scorecard” that compiles and publicizes data from states for both Medicaid and the Children’s Health Insurance Program (CHIP), a companion for youngsters in working-class families.

This first scorecard includes state-by-state information showing that, on average, just over half the women on Medicaid are getting care while they are pregnant and after giving birth. Only three in five babies get checkups during their first 15 months, and less than half of children and teenagers have preventive dental visits.

These and other measures show wide variations among states, though the initial version does not explicitly rank them. The scorecard also makes public for the first time measures of governments’ performance, such as how long both state and federal health officials take when states request “waivers” to deviate from Medicaid’s ordinary rules.

For now, the Trump administration is not attaching any consequences to how states fare, but Verma said that could change over the next few years as CMS refines and adds to the scorecard and members of Congress assess what it shows.

For now, “this is a conversation starter,” she said during a briefing for reporters. Even though Medicaid pays for roughly half the nation’s births, “have we ever had a conversation about [how states vary in] birth outcomes?”

The scorecard is part of a fundamental recalibration of the power relationship in Medicaid between the federal government and states. Since the program was created in 1965 as part of Lyndon Johnson’s War on Poverty, both have shared responsibility for paying for and defining the eligibility and benefits.

Medicaid now covers more than 67 million individuals, while CHIP covers nearly 6.5 million.

In the Trump era, federal health officials have been eager to give states more flexibility over Medicaid’s rules and benefits. Most significantly, the administration told states this year that it will allow them to require people to work or participate in other forms of “community engagement” to qualify for the program.

More recently, Verma also has said that such flexibility must be accompanied by heightened federal efforts to keep tabs on how well each state’s Medicaid program is functioning.

“With all the flexibility must come accountability,” she said Monday. “We must be honest with ourselves and honest with our stakeholders . . . about how well we are doing.”

Verma worked for years as a consultant to states’ Medicaid programs before coming to Washington early last year to run CMS, a major branch of the Department of Health and Human Services. She first broached the idea of a scorecard in a speech in November to states’ Medicaid directors, saying it was “a historic opportunity to transition from merely following federal rules and processes to focusing on achieving positive health outcomes — tangible results that will improve the lives of our beneficiaries.”

Following her announcement on Monday, Matt Salo, executive director of the National Association of Medicaid Directors, noted that states have for years measured and tried to improve the quality of their own programs. He called the federal effort to centralize such efforts “commendable.”

But data “that can be great internally to show how a state is doing don’t necessarily lend themselves” to comparisons among states. Salo said. For instance, states differ significantly in the proportion of their Medicaid residents covered by managed-care plans. In measuring the health of those beneficiaries, he said, the data look very different for a state such as Arizona, which enrolls everyone on Medicaid in managed-care plans, than for states that enroll only healthier adults in the plans.

And states that have expanded Medicaid under the Affordable Care Act to include people living above the poverty line are likely to have better health results than states that admit only residents in severe poverty, Salo added.

The scorecard’s initial information is based on states that voluntarily report a series of measures about the health of their Medicaid and CHIP enrollees. It shows, for instance, that the percentage of adults on Medicaid with high blood pressure under control as of 2016 varied from 26 percent in Louisiana to 72 percent in Rhode Island. The percentage of children ages 3 to 6 on Medicaid and CHIP who were getting adequate doctors’ care varied from 48 percent in Alaska and Idaho to 86 percent in Massachusetts.

Verma did not specify what additional information will be in later scorecards, but she said federal officials might be interested in how many people on Medicaid are working or volunteering, regardless of whether a state has imposed work requirements in its program.

The big takeaway, Salo said, is not the specifics of this “1.0 [version]. It is 2.0. . . . What measures are going to be used? What are the implications? What is that going to do?”

California Assembly Passes Bill Expanding Medicaid to Immigrants

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Source: Modern Healthcare

California’s General Assembly has passed a bill to become the first state to extend Medicaid coverage to immigrants, regardless of their status.

The bill, known as AB 2965, passed the Democratic-controlled Assembly 33-21 on Wednesday. The proposal would eliminate legal residency requirements in California’s Medicaid program, known as Medi-Cal, and the state has already nixed the requirement for individuals younger than 19.

Offering full-cost coverage would cost the state $3 billion for the 2018-19 year, according to California’s Legislative Analyst’s Office.

The state Senate will consider the bill next, and its Democrat leaders are expected to pass the proposal.

Currently, undocumented California residents have inconsistent access to care and significantly rely on community clinics or emergency rooms.

“That’s not the same as having a general practitioner or internist you see regularly,” said Almas Sayeed, deputy director of programs and counsel for the California Immigrant Policy Center. “This would be a systematic way to keep communities healthy.”

There are some concerns about the proposal. Policy experts question whether undocumented individuals will move to California to take advantage of the benefit and how long the state could afford such a cost without federal assistance.

Joel Hay, a health policy and economics professor at the University of Southern California, said he hasn’t seen evidence that access to care for undocumented individuals is lacking in California and questioned whether the law was necessary.

“In some ways this could be political maneuver on the part of liberal, pro-immigrant politicians in this state and perhaps elsewhere,” Hay said.

IRS Unveils 2019 HSA and HDHP Limits for Contributions

Source: Employee Benefit Adviser

Earlier this month, the Internal Revenue Service announced in Revenue Procedure 2018-30the 2019 limits for contributions to health savings accounts and definitional limits for high deductible health plans. These inflation adjustments are provided for under Internal Revenue Code Section 223.

For the 2019 calendar year, a HDHP is a health plan with an annual deductible that is not less than $1,350 for self-only coverage and $2,700 for family coverage (i.e., the same as 2018). Annual out-of-pocket expenses for 2019 (deductibles, copayments and other amounts, excluding premiums) cannot exceed $6,750 for self-only coverage and $13,500 for family coverage.

For individuals with self-only coverage under a HDHP, the 2019 annual contribution limit to an HSA is $3,500 and for an individual with family coverage, the HSA contribution limit is $7,000.

No change was announced to the HSA catch-up contribution limit. If an individual is age 55 or older by the end of the calendar year, he or she can contribute an additional $1,000 to his or her HSA. If a person is married and both spouses are age 55, each individual can contribute an additional $1,000 into his or her individual account.

For married couples with family coverage, they must have two HSA accounts if they want to contribute the maximum $7,000 (or $9,000 if both are eligible for catch-up contributions). The contribution cannot be maximized with only one account. One individual would contribute the family coverage maximum plus his or her individual catch-up, and the other would contribute the catch-up maximum to his or her individual account.

Plan sponsors should ensure that all participant communications for the 2019 plan year reflect the new limits.

Where Do Premium Dollars Go? Mainly to Drugs and Doctors.

Image result for images Where Do Premium Dollars Go? Mainly to Drugs and Doctors.

Source: Fierce Healthcare

Prescription drugs make up nearly a quarter of health insurance premium costs, with doctor visits not far behind, according to new research.

report (PDF) released on Tuesday by America’s Health Insurance Plans (AHIP) found that a hefty 23.3% of premium spending goes towards prescription drugs, an amount that even astonished researchers.

“What’s quite surprising is that the prescription drug piece has really started to separate from the rest of the healthcare expenditures,” Craig Burns, vice president at AHIP’s Center for Policy and Research, told FierceHealthcare.

The issue of ever-increasing drug prices has been in the national spotlight for some time, and it’s currently a major target of the Trump administration, which is seeking to control spending at the insurer and pharmacy benefit manager level.

The study also found that about 22.2% of premium dollars go to physicians and doctors. An additional 20.2% goes towards other office or clinic costs, including nurses’ salaries and equipment and supplies, while hospital stays make up 16.1%.

The research was conducted using data between 2014 and 2016 from five for-profit and 25 nonprofit insurer plans, which Burns said is representative of the sector as a whole.

A separate report by Altarum pointed to hospital spending and drugs as some of the main drivers of healthcare price growth, which is currently at a record high 2.2% compared to last year.

Comparing service costs between private premiums and Medicaid and Medicare is apples to oranges due to differences in billing and how spending is classified. However, it appears government payers score significantly better on operating costs.

Operating costs and taxes make up 15.9% of premium costs, the AHIP research found. Meanwhile, MACPAC has pinned operational spending under Medicaid to less than a third that, at about 5%.

To Bend the Healthcare Cost Curve, Policymakers Need to Make the Business Case for Change

Image result for images Farzad Mostashari

Source: Fierce Healthcare

Bending the healthcare cost curve requires stakeholders to ask themselves one question: “Who makes money in America preventing bad things from happening to patients?”

Farzad Mostashari, M.D., the former National Coordinator for Health IT at the Department of Health and Human Services, said that question is key to establishing policies that will drive the innovation needed to reduce growing healthcare costs. Policymakers should set the rules and “let the players play,” he said.

“You want to align policy so that individual profit-seeking furthers societal goals,” said Mostashari, CEO of Bethesda-based Aledade Inc., which offers technology and services to help physicians reduce costs and organize accountable care organizations.

Health policy needs to make a clear business case to succeed, he said, speaking at a forum on the cost of healthcare in the U.S. hosted Thursday by the Alliance for Health Policy.

For example, one of the crucial barriers to interoperability and data-sharing is not the tech itself, but that providers and other stakeholders may not see the financial value in sharing the data they have.

He said this is why the Centers for Medicare & Medicaid Services’ idea of tying participation to mandatory data-sharing could lead to significant change.

An area that’s been a breeding ground for innovation in cost-cutting is Medicare Advantage, and what works there could be a model for others to follow, Mostashari said.

The structure of Medicare Advantage incentivizes providers and plan administrators to promote wellness and other preventive care, he said, as they are paid a flat monthly rate for each member’s care—regardless of how much he or she uses. If that individual’s costs can be cut, the rest is profit, which is a powerful motivator, Mostashari said.

“This is not an accident,” he said. “If you set the right payment policies, opportunities will emerge.”

That means Medicare Advantage is an area ripe for disruption, too, he said. Walmart, for example, is reportedly eyeing a merger with Humana because it sees the potential benefits in jumping into the MA space, he said.

Treating fee-for-service Medicare more like MA could lead to innovations that help bend the cost curve, he said. But there is “a fly in this ointment,” Mostashari said: growing monopolies.

Payment policies incentivize this trend, he said, so new payment models need to stop pushing providers into anticompetitive mergers.

“You’re laying the seeds for your own demise,” Mostashari said.

Tax Bill and Obamacare Repeal are Potent Issues in California Congressional Races

Tax bill and Obamacare repeal are potent issues in California congressional races, poll showsSource: Los Angeles Times

With Democrats angling to win back control of the U.S. House, the new tax law and the failed attempt to repeal Obamacare may prove to be important campaign flashpoints against California Republicans, according to a new USC Dornsife/Los Angeles Times poll.

Sixty percent of registered voters statewide approved of the Affordable Care Act, also known as Obamacare. The support was highest among Democrats and people who disapprove of President Trump, and concentrated in urban and coastal areas — which happen to be regions where there are several competitive congressional races.

A majority of voters, 54%, said they would be less likely to reelect their representative if that member of Congress voted to repeal the healthcare law.

Nearly half of voters, 47%, said they opposed the federal tax overhaul signed by Trump in December. It had support of 27% of voters surveyed, and 26% weren’t sure or had no opinion. A slim majority of voters, 52%, said they would be less likely to vote to reelect their member of Congress if he or she supported the bill.

That could be sobering news for Republican incumbents in California: all 14 of them voted to repeal Obamacare, an effort that eventually failed. Twelve of the GOP lawmakers voted for the tax overhaul and only two voted against it. One of them, Rep. Darrell Issa of Vista, announced he was retiring three weeks later.

“At the federal level, these are very promising issues for Democrats in what looks to be a promising year,” said Bob Shrum, a former Democratic strategist who is now the director of the Jesse M. Unruh Institute of Politics at USC. “I think in vulnerable Republican seats where independents can make a difference, Democrats can and will use [the votes] as levers in the election.”

The poll showed that while support for each issue was highly correlated with party affiliation and support for the president, independent voters tended toward sharing the views of Democrats on both policies. About half of independents said they would be less likely to reelect their member of Congress for voting to repeal Obamacare or supporting the tax bill.

The poll also found a majority of higher income earners and people with college degrees were less likely to support their member of Congress for voting against Obamacare or for the tax plan.

Most of the participants who approved of Trump’s performance as president said they were more likely to support their representative for voting for the tax plan.

Trump’s overall approval was dismal: fewer than 3 in 10 voters were happy with how he’s doing, and nearly 7 in 10 disapproved.

The USC/LAT survey was conducted online from April 18 to May 18 and included 691 registered voters. The overall margin of sampling error is 4 percentage points in either direction.

Democrats have been attempting to use the votes against Republicans the entire campaign season.

The House Majority PAC began running digital ads against Rep. Dana Rohrabacher (R-Costa Mesa) shortly after he voted to pass the healthcare repeal bill. The ads focused on a provision in the bill that would have raised the cap on health insurance premiums for older Americans, who are generally some of the most reliable voters in midterm elections.

Even after the measure failed in dramatic fashion, the super PAC continued to beat the drum, running ads in other California districts to attack GOP Reps. Jeff Denham, David Valadao, and Mimi Walters for their “unforgivable” votes.

Ahead of Valentine’s Day, they transitioned to the tax bill vote, posting a billboard with a box of chocolates along Highway 99 in the Central Valley that declared, “This year, Jeff Denham gave you higher taxes.”

Track the California races that could flip the House »

“From the large scale national view, the path to victory is through economic messages,” said Jeb Fain, a spokesman for House Majority PAC.

Fain said Democrats plan to try to use specifics when attacking Republicans on these issues. In the Central Valley, for example, fears over increasing healthcare premiums for seniors may give people a reason to vote, while college-educated suburbanites might be incensed by the tax bill’s impact on the federal budget deficit, he said. Still others may be concerned about rising premiums due to the tax bill’s elimination of Obamacare’s individual mandate or the cap on deductions for state and local taxes.

For now, many Democratic groups including Fain’s are putting resources toward ensuring their candidates make it through California’s top-two primary, which advances the first and second-place candidates regardless of party. The DCCC and the House Majority PAC have spent a combined $2.2 million so far in three districts where the risk of a shut-out is highest. Expect them to switch gears as soon as the dust settles on the June 5 primary.

Hounding Republicans on a vote they took more than a year ago may be a tougher sell as Democrats transition to the November election, simply because Obamacare was not, in fact, repealed.

The tax law seems like a more poigniant campaign issue since Californians remain deeply skeptical about it. The law is expected to disproportionately impact high-tax, expensive states like California because of caps on the state and local tax and mortgage interest deductions, although much of that won’t be felt until the next tax year — after the midterms.

“Californians specifically are feeling the brunt of much of the Republican agenda on their pocketbooks,” said Drew Godinich, a spokesman for the Democratic Congressional Campaign Committee.

Democrats might be banking on kitchen table issues turning out their voters, but Republicans aren’t waiting around for that to happen. Even before the tax vote, GOP groups were investing in ads to defend the party’s lawmakers. And they are willing to spend millions with control of the House on the line.

Courtney Alexander, a spokeswoman for the American Action Network, called the tax law, known officially as the Tax Cuts and Jobs Act, “the single most important issue in 2018.” The group has run a multitude of ads bolstering California Republicans for supporting the plan.

“Add it up, then thank Congresswoman Walters for cutting our taxes,” one of the ads said.

The group already has spent $30 million nationwide, much of it in California. The Congressional Leadership Fund super PAC, affiliated with American Action Network, is paying for field organizers to get-out-the-vote in several of California’s contested House districts.

Those organizers oversee armies of volunteers who have spent weekend after weekend knocking more than 10 million doors to date nationally.

Coverage of California politics »

The message: Here’s what your Republican member of Congress is doing for you.

On a recent Saturday morning, a field organizer and volunteer rang doorbells and left door hangers in Walters’ 45th Congressional District on a neatly trimmed street in the Orange County suburb of Tustin.

“Will you be supporting Congresswoman Mimi Walters in the midterm election?” one of them asked Mike Zapata when he opened the door.

“I think so,” Zapata, a 45-year-old independent, said. He told the campaigners that lower taxes, jobs and national security were top-of-mind issues for him.

“I have looked at my paycheck, there’s a slight bump. That’s money back in my pocket but I won’t know the full impact until next year,” he said. “I think pro-growth tax policy is important, especially for Orange County residents.”

Alexander cited AAN’s own polling that showed people in the 45th district have a better understanding of the tax law now than they did last year. Nearly half of respondents believed the tax law would increase their taxes in a December survey. In late April, just over a quarter did.

“Members like Mimi Walters are doing a good job of selling it and going home and talking about the tax cuts and talking about what it means for the average family in their district,” Alexander said. “At the end of the day, people want to be able to support their family, they want to have a little extra money.”

Last Updated 06/06/2018

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