White House Distances Itself From Pelosi Plan to Lower Drug Prices

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Source: The Hill

The White House is distancing itself from Speaker Nancy Pelosi’s (D-Calif.) plan to lower drug prices, emphasizing support for a bipartisan plan in the Senate instead.

The White House has been in talks with Pelosi’s office for months on drug prices, a rare shared priority, but the effort always faced tough odds given the partisan divide and the impeachment inquiry into President Trump.

Now the Trump administration is downplaying the chances it will endorse Pelosi’s bill, instead pointing to a somewhat more modest bill in the Senate from Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.), the chairman and ranking member, respectively, of the Senate Finance Committee.

“Lines of communication remain open with the Speaker’s office, but the Grassley-Wyden proposal is the most likely solution that could advance on a bipartisan basis and achieve the President’s priority of lowering drug prices even further for all Americans,” White House spokesman Judd Deere wrote in an email.

The statement comes after White House adviser Joe Grogan made similar comments in an interview with Politico, saying he told Pelosi’s office, “I admire the ambition, but I don’t know how you’re going to get it through. It might be time to start thinking about [the Senate Finance bill].”

Congressional Republicans have denounced Pelosi’s bill as “socialist,” whereas at least some Republicans support the Grassley-Wyden bill, though many also oppose it.

But Pelosi’s bill is the only measure that allows Medicare to negotiate drug prices, something that Trump called for in his 2016 campaign before backing away from it once in office. That has led some Democrats to say Trump is breaking his promise if he does not support Pelosi’s bill.

“Trump used to insist that we needed to ‘negotiate like crazy’ to lower Rx prices,” Pelosi spokesman Henry Connelly tweeted after Grogan’s comments to Politico. “House Dems’ legislation is the only bill that includes negotiation. Instead of caving to Big Pharma, the Trump Admin should work with us to pass the Lower Drug Costs Now Act through the GOP Senate.”

Pelosi’s bill would allow the secretary of Health and Human Services to negotiate lower prices for up to 250 drugs per year, with the lower prices also applied to private insurers.

The Grassley-Wyden bill does not include negotiation, and it is centered on lowering drug prices in Medicare, in contrast to Pelosi’s bill, which would also lower prices for people with private insurance.

The Grassley-Wyden bill does require drug companies to pay money back to Medicare if their prices rise faster than inflation, though many Republicans have objected to that provision and the White House has expressed openness to taking it out.

Uber, Lyft, DoorDash Launch a $90-million Fight Against California Labor Law

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Source: Los Angeles Times

Launching what could become one of the most expensive issue campaigns in California history, a trio of Silicon Valley gig-economy companies on Tuesday unveiled a ballot measure to exclude many of those they pay for work from being considered benefits-earning employees.

The proposal, which Uber, Lyft and DoorDash intend to qualify for the statewide ballot next November, states that an “app-based driver is an independent contractor” as long as a series of conditions are met by a company. If approved by voters, the initiative would also enshrine in state law a number of perks for those workers, including a minimum amount of pay as well as insurance to cover work-related injuries and auto accidents. And it lays out details for healthcare subsidies, protections against on-the-job harassment or discrimination and a system to enforce some workplace rights.

“Work choice is a critical component to our state’s economic success and growth,” said David Nelson, public policy director of the California Asian Chamber of Commerce, who said that many Asian restaurants now have access to new customers through app-based deliveries. “Forcing ride-share and delivery drivers to become employees would significantly limit the availability and affordability of these services to exist.”

Many of the initiative’s promised benefits reflect criticisms leveled against the companies by supporters of Assembly Bill 5, the new law taking effect in January that will apply a series of rigorous new tests a company must meet before excluding workers from being designated as an employee. How to properly determine a worker’s job status was the key finding in a far-reaching ruling by the California Supreme Court in 2018 that significantly reduced the number of situations in which a person can be considered an independent contractor. Lawmakers spent months deciding whether to limit the ruling’s impact on some businesses and to what extent.

Signed into law by Gov. Gavin Newsom last month, AB 5 was at the center of an intense state Capitol battle between organized labor and business groups. Companies representing a wide swath of the state’s economy — physicians, accountants and investment advisors, among many others — were carved out of the new law, insisting their operations would suffer or cease to exist if they were forced to provide benefits and extend rigorous workplace rules to more people currently paid as independent contractors. Many other industries were not exempted, and lawmakers have promised to consider additional changes when they return to Sacramento in January.

Assemblywoman Lorena Gonzalez (D-San Diego), the author of AB 5, accused Uber, Lyft and DoorDash of focusing solely on corporate profits, regardless of the impact on individual workers.

“They’ve never moved from their position of giving workers half of what they deserve,” Gonzalez said Tuesday. “It’s massive income inequality.”

The spring and summer debate also marked the political debut of California’s app-based companies, whose business model dominated much of the discussion over the law’s impact. In August, the three companies said they would ultimately submit a proposal for next November’s statewide ballot, convinced they would fail to get their demanded protections through legislative negotiations. Ride-hailing services Uber and Lyft said they would commit a combined $60 million to fund the statewide initiative , with food delivery service DoorDash later announcing it would spend $30 million.

But exactly what the companies would ask California voters to enact wasn’t clear until the 17-page proposal was submitted to the state attorney general for review on Tuesday.

In many ways, the initiative seeks to offer remedies to some of the biggest complaints lodged by drivers and labor activists. The ballot measure states, for example, that all tips paid by customers will go to drivers and will not result in a driver being paid less money — while also establishing a minimum pay of 120% of California’s minimum wage, scheduled to rise statewide to $13 an hour for most businesses next year.

Drivers would also be paid a 30-cents-per-mile fee for expenses such as gas and vehicle maintenance, an amount to be adjusted annually for inflation. And it promises driver protections that will exist even if a person chooses to work with more than one company. A driver could receive a healthcare stipend from multiple app-based companies. Supporters said that the initiative would create a system where drivers who work 25 hours a week or more would receive a stipend large enough to cover 82% of the cost of the least expensive insurance plan offered under the Covered California exchange.

Criticisms have hounded the companies over driver and passenger safety. The initiative requires criminal-background checks and bans on drivers convicted of certain felonies and of driving under the influence of alcohol or drugs. It also requires companies to provide safety training and gives those drivers until July 1, 2021, to complete the courses provided.

But Gonzalez said the provisions appear to offer the gig-economy drivers less in overall rights and wages than they will receive under the 2018 court ruling or AB 5 when the law takes effect. In particular, she questioned the details of how the minimum wage guarantees would work and the apparent lack of worker compensation benefits and unemployment insurance. And she rejected the claims of the companies that they will be held to rigid rules under her legislation.

“There’s nothing in AB 5 that doesn’t allow for flexibility,” she said.

Labor groups vowed to fight the ballot measure.

“These CEOs are attempting a big-money veto to undo labor protections the bipartisan California Supreme Court, the California Legislature and the governor all agree on,” said Art Pulaski, executive secretary-treasurer of the California Labor Federation. “No corporation should be above the law, no matter how much they spend on political campaigns to rig the rules in their favor.”

The proposal is a latecomer to the 2020 ballot measure process. Most supporters of likely measures had their initiatives vetted by state officials weeks or months ago and are already collecting voter signatures. The relatively late start for the tech companies means they will likely have to pay more to circulate petitions, with the ultimate goal of gathering more than 623,000 valid voter signatures by spring of next year.

Brandon Castillo, a spokesman for the initiative campaign, said other app-based companies are expected to join the effort between now and next November.

“We’re going to spend what it takes to win,” he said.

The Eight Big Problems with Warren’s Medicare-for-All Plan

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Source: The Washington Post

Sen. Elizabeth Warren (D-Mass.) released her spending plan to finance Medicare-for-all, a single-payer health-care scheme that would eliminate private insurance. The Post reports:

—The plan is designed to hit corporations and the wealthy, including a provision requiring companies to send most of the funds they currently spend on employee health contributions to the federal government. It also expands Warren’s signature wealth tax proposal, cuts military spending and takes advantage of what she says would be significant savings from eliminating private insurance’s vast bureaucracy….

—The proposal comes on top of roughly $5 trillion in new taxes that Warren had already advocated to cover a range of new programs, including through a levy on those with more than $50 million in assets. It doubles down on Warren’s strategy of winning the Democratic nomination by consolidating support from the party’s liberal wing, rather than reaching out to more centrist Democrats.

The plan, as one would expect, was roundly criticized by former vice president Joe Biden’s campaign, which put out a statement that said it “hinges not just on a giant middle class tax hike and the elimination of all private health insurance, but also on a complete revamping of defense, immigration, and overall tax policy all at once in order to pay for it — a hard truth that underscores why candidates need to be straight with the American people about what they’re proposing.”

About the only thing all the Democratic candidates might agree upon is that this is the most sweeping proposal we have seen from any major-party candidate, one which would revamp the entire federal budget and the health care of every American.

There are (at least) eight problems she will have to contend with:

First, her plan raises a purported $20.5 trillion, around $10 trillion less than independent cost estimates for the plan from progressive groups such as the Urban Institute. Even Sen. Bernie Sanders (I-Vt.) concedes it would cost $30 trillion or more. Perhaps voters’ eyes will glaze over, and they will decide that everyone can find an economist to justify anything, but others might see the sort of standard sleight of hand — trillions in administrative savings! stronger tax enforcement! — as confirmation that it really is impossible to come up with a plan this extensive and not further burden the middle class.

Moderate Sen. Michael Bennet (D-Colo.) blasted Warren’s plan in a written statement. “Voters are sick and tired of politicians promising them things that they know they can’t deliver,” he said. “Warren’s new numbers are simply not believable, and have been contradicted by experts. Regardless of whether it’s $21 trillion or $31 trillion, this isn’t going to happen, and the American people need health care.”

Second, there is not much of a justification as to why we need this when Affordable Care Act premiums are decreasing and other issues (e.g. extending coverage, premium costs) can be addressed through much cheaper proposals, such as the public option. (As Biden’s campaign put it, “Most voters want to protect and strengthen the Affordable Care Act.”)

Third, it is pretty clear to all but the horribly naive that this is never going to happen. An $800 billion cut in defense? What’s the justification for that, and what national security concerns does it raise? What moderate Democrat is going to sign on to this? The bigger and more complicated it is, the more obvious it becomes a fantasy — one that could prevent more modest and achievable ends such as prescription drug cost containment. Warren is relying, for example, on a wholesale immigration reform plan (something that frankly does not seem politically attainable) to generate hundreds of billions of dollars (above and beyond revenue going to state and local governments). At some point, this fails the straight-face test.

Fourth, eliminating all private insurance has real-world impacts on health-care providers. The New York Times reports: “Ms. Warren’s plan would put substantial downward pressure on payments to hospitals, doctors and pharmaceutical companies. … Payments to hospitals would be 10 percent higher on average than what Medicare pays now, a rate that would make some hospitals whole but would lead to big reductions for others. She would reduce doctors’ pay to the prices Medicare pays now, with additional reductions for specialists, and small increases to doctors who provide primary care.” Do rural hospitals survive by protecting against the uninsured or go bust without the much higher reimbursement rates that private insurers provide? If doctors’ salaries get chopped, how will this affect time with patients and the availability of specialists?

Fifth, her proposal tests the limits of her electability argument. The Times observes: “Although she is not proposing broad tax increases on individuals, her proposal will still allow Republicans to portray her as a tax-and-spend liberal who wants to dramatically expand the role of the federal government while abolishing private health insurance. Her plan’s $20.5 trillion price tag is equal to roughly one-third of what the federal government is currently projected to spend over the next decade in total.” Simply put, this really is the sort of plan President Trump would use to scare voters into sticking with him rather than plunging into a “socialist” abyss.

Sixth, Warren winds up handing the health-care issue right back to the Republicans. Andy Slavitt, who headed the Medicare and Medicaid trust funds under President Barack Obama, tells me: “In my view, 90 percent of the Democratic focus on health care should be on Trump’s lawsuit and his other plans to get rid of the ACA and pre-existing condition protections.” He suggests, “The other 10 percent can be on policy differences between the candidates on how they would ideally make universal coverage happen.” He warns, “Doing the reverse is like spending 90 percent of the time on environmental issues debating the Paris Accord vs. the Green New Deal instead of spending 90 percent of the time remembering they are running against a climate denier.”

Seventh, Warren doesn’t seem to consider the downsides from slashed reimbursement (nurses pay?), elimination of private insurance companies (jobs for all those white-collar workers?) and/or mammoth tax hikes (growth? jobs?). This embodies one of the major criticisms of the super-progressive wing of the Democratic Party: blind faith in centralized federal government with little or no regard for unintended consequences.

Eighth, the plan does damage to her brand. Warren’s plan is a reminder of how far to the left of the rest of the field she really is. The notion that she is a “compromise” between Sanders and center-left candidates will be harder to sustain. Moreover, she was supposed to be the straight-shooter, the candid progressive who could tip the scales in favor of working-class Americans. There are plenty of voters (including more moderate African American voters with whom she has struggled to connect) who might regard this as akin to Trump’s magical health-care plan (better! cheaper!) or other snake oil peddled by politicians. People have become a bit too savvy to think you can have everything for nothing.

Warren will have ample opportunity to defend her plan at the next debate. In the meantime, Democratic voters can mull over whether this makes it easier or harder to defeat Trump.

Elizabeth Warren’s ‘Medicare for All’ Math

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Source: The New York Times

She thinks a single-payer health care system can save more than other analysts think. Here’s where she says she’ll get the money to pay for it.

Elizabeth Warren’s “Medicare for all” proposal would make substantial shifts to how the United States pays for its health care system. She would eliminate most other forms of coverage, including private insurance, and provide all Americans with a generous government-run plan.

To calculate its cost, she has modified estimates from the Urban Institute, a Washington research group that has assessed the legislative proposal she is endorsing.

To pay for it, she has proposed large new taxes, transfer payments and some cuts to government spending. Altogether, her campaign believes health spending under Medicare for all will cost $52 trillion over the next decade, with about half shifting from other sources onto the federal budget.

The Warren plan includes several key assumptions, including starkly lower prescription drug prices, minimal administrative spending and health care costs that grow at a significantly slower pace.

Warren backers describe these cuts as ambitious and assertive, contending that the American health system — which has the highest prices in the developed world — could weather the change. Other health care experts call the ideas unrealistic, given the revenue that American doctors, hospitals and drug companies have become accustomed to earning.

The key question in this debate is, how quickly can the United States tamp down its sky-high health care prices?

“The whole point of this analysis, which took weeks and was done with real discipline, was to come up with, what is realistic?” said Don Berwick, a co-author of an economic analysis of the Warren plan, and former administrator of the Centers for Medicare and Medicaid under President Barack Obama. “I think they’re achievable and, for those who are critical, please show me yours.”

Here’s a summary of what Ms. Warren has proposed on either side of the ledger.

To reduce the plan’s costs:

• Change the way Medicare pays for certain types of hospital stays, such as paying a package rate rather than different fees for surgical services, and paying doctors in hospital-owned practices the lower prices paid to those in private practices. ($2.3 trillion)

• Assume that the Medicare for all program itself can operate very leanly. The Urban Institute estimated that Medicare would devote about 6 percent of its health budget on administrators to decide what and how Medicare would pay for things, and to prevent fraud. In Ms. Warren’s plan, that rate is 2.3 percent. ($1.8 trillion)

• Assume very aggressive drug discounts. Ms. Warren believes a government system will be able to reduce spending on drugs substantially, including lowering the prices of branded prescription drugs by 70 percent. ($1.7 trillion)

• Assume slower growth in health spending over time. The federal government now thinks health spending will increase by 5.5 percent a year; the Warren campaign assumes 3.9 percent growth under Medicare for all, closer to the rate of growth in gross domestic product. ($1.1 trillion)

• Assume lower payments to hospitals. The campaign believes hospitals can be paid around 110 percent of what they are currently paid by Medicare, a number that would cause some hospitals to operate at a loss. Currently, private health insurers often pay a lot more to hospitals than Medicare for similar procedures. ($600 billion)

To pay for the plan:

• Employers would be required to pay fees to the federal government, equivalent to 98 percent of what they now spend on their employees’ health care. Some companies would be exempt, and companies with unionized work forces would be able to lower this payment if they increased workers’ wages. Currently, companies vary greatly in the cost and generosity of their health benefits, so this fee would vary substantially by firm. ($8.8 trillion)

• States and local governments would be required to make payments to the federal government, similar to what they currently spend on government employee benefits and their share of Medicaid expenses. ($6.1 trillion)

• Corporate taxation would be increased. ($2.9 trillion)

• Tax collections would increase through improvements to I.R.S. enforcement, which Ms. Warren believes could raise a lot of money. ($2.3 trillion)

• The top 1 percent of individual earners would pay new taxes on their capital gains; they would pay taxes on increases in investment value annually, instead of waiting until assets are sold. ($2 trillion)

• Income tax collections would increase, since workers would no longer pay part of their salaries for insurance premiums, which are not taxed now. ($1.4 trillion)

• Billionaires would pay a higher wealth tax than the rate Ms. Warren has previously proposed: 6 percent, up from 3 percent. ($1 trillion)

• A new financial transactions tax would be imposed on stock trades. ($800 billion)

• Pentagon spending from an overseas contingency fund, often criticized as a slush fund, would be eliminated. ($800 billion)

• Income earned by immigrants, following the passage of her immigration overhaul plan, would provide new tax revenues. ($400 billion)

• A risk fee on the liabilities of banks with more than $50 billion in assets would be introduced. ($100 billion)

Drug Companies Spend Millions on Lobbying as Congress Tries to Rein in High Drug Prices

Image result for Drug Companies Spend Millions on Lobbying as Congress Tries to Rein in High Drug Prices imageSource: The Hill

Prescription drug companies and trade groups shelled out millions of dollars to lobby Congress as it considered legislation aimed at reining in skyrocketing drug prices, according to new lobbying disclosure reports.

The Pharmaceutical Research and Manufacturers of America (PhRMA) — the trade group representing branded drug companies — spent $6.2 million on lobbying in the third quarter of 2019, which ran from July through the end of September.

That’s $240,000 more than it spent during the same time frame last year.

Bipartisan members of Congress have worked all year on proposals aimed at curbing rising drug prices as polls show voters are increasingly worried about the issue.

PhRMA lobbied on dozens of bills related to the industry, according to the reports, including one proposed by Speaker Nancy Pelosi (D-Calif.) that would let the government negotiate the prices it pays for prescription drugs through Medicare.

The industry has pushed back fiercely on the proposal, calling it government “price-setting” that would kill drug innovation.

Prescription drug companies have also sharply increased their lobbying amid a flurry of legislation targeting the industry.

Gilead, the maker of HIV drug Truvada, spent $1.5 million on its lobbying efforts in the third quarter of 2019, a 117 percent increase over what it spent during the same time frame last year.

Gilead has faced criticism for pricing Truvada at about $20,000 a year.

Several drug companies, including Amgen and Bayer, also lobbied on bills that would allow the importation of cheaper drugs from other countries, a proposal that is opposed by the industry.

Amgen, whose drugs treat chronic illnesses, spent $3 million in the third quarter, a 16 percent increase over what it spent in the same time frame last year.

Meanwhile, Bayer, the maker of a top-selling prescription blood thinner, spent $2 million on lobbying in the third quarter, a 32 percent increase over what it spent during the same time frame last year.

Drug companies, including AbbVie, are also lobbying on a proposal from the Trump administration that would tie what the U.S. pays for drugs to what other countries pay.

AbbVie spent $1.8 million on lobbying in the third quarter of 2019, a nearly 200 percent increase from what it spent in the same time frame last year.

Sanofi, which has been under fire over the rising costs of insulin, spent $1.7 million on lobbying in the third quarter, an increase of 105 percent from what it spent during the same time frame last year.

Some drug companies decreased the amount they spent on lobbying.

Pfizer spent $1.6 million in the third quarter, compared to the $2.9 million it spent in the same time frame last year.

Meanwhile, Eli Lilly spent $1.4 million on lobbying in the third quarter, a drop of $560,000 from the same time frame last year.

Employers Looking Beyond High-Deductible Health Plans to Solutions that Empower Workers

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Source: FierceHealthcare

Employers are seeking more innovative ways to manage healthcare costs while hitting the pause button using high-deductible health plans (HDHPs) to do it, a new survey shows.

Mercer released its annual survey of the employer-sponsored health plan market Monday in conjunction with the HLTH conference and found that large and midsized employers (500 workers or more) raised deductibles for PPO plans on average by just $10 in 2019.

The survey, which polled 2,558 employers with at least 10 employees on their health benefits, also found the number of companies offering workers solely an HDHP declined, particularly among employers with 20,000 or more employees.

Among those employers, 16% offered solely an HDHP in 2019, down from 22% in 2018.

“In general, with five generations of workers in the workplace, we need more choice,” Tracy Watts, Mercer’s national leader for health policy, told FierceHealthcare in an interview at the conference. “It’s not one-size-fits-all.”

She said, however, that HDHPs are far from dead—they’re just becoming rarer as the sole option for workers. One reason for that is employers want to try new things, such as direct primary care, which aren’t options for now in consumer-directed plans with health savings accounts.

A direct primary care contract or an on-site clinic is especially attractive for employers who are concerned about managing the health of low-income workers. A factory worker working long shifts, for example, may not be able to get to a doctor, which could result in worse health, Watts said.

Moving toward these strategies to manage costs also improves employee health and worker retention, she said, and empowers them to manage their health more effectively. Mercer’s survey found that 58% of large and midsized employers are deploying alternative solutions like direct primary care.

“It can help create better stickiness,” Watts said

The National Business Group on Health identified similar trends in its annual survey of large employers, which was released in the summer. Both surveys highlight a shift in approach for employers, who remain highly concerned about healthcare costs but recognize continuing to shift those costs to employees is increasingly untenable.

Mercer’s survey found that healthcare costs are continuing to increase at a relatively low rate, for a projected 3.6% in 2020, but at a clip that still surpasses the rate of inflation and worker’s wage growth.

As such, employers ranked affordability concerns—particularly managing workers with high claims costs and specialty drugs—as key priorities for the next five years. Eighty percent said better managing high-cost workers was either a very important or important priority, and 71% said the same about specialty pharmacy.

The survey found a 5.5% increase in pharmacy trend, which Watts said is lower than what they’ve reported in the past but is still a double-digit boost.

“It’s lower than what we’ve seen, but I don’t think we’re going to declare a victory on 5.5% trend,” Watts said. “It’s concerning for employers—it’s the biggest thing.”

Healthcare Costs Projected to Rise 5% in 2020 as Employers Look to Control Costs

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Source: Healthcare Finance

Curbing the cost of healthcare and increasing its affordability remain the top priorities for 93% of employers over the next three years, according to the 24th annual Best Practices in Health Care Employer Survey by Willis Towers Watson.

Despite that, however, nearly two in three employers see healthcare affordability as the most difficult challenge to tackle over that same period.

Employers expect healthcare cost increases of 4.9% in 2020 compared with 4% in 2019. Despite this cost increase, 95% of employers are very confident their organization will continue to sponsor healthcare benefits to active employees in five years. Moreover, employers’ longer-term commitment to sponsoring these benefits 10 years from now hit 74%, the highest level in the past decade.

The rising cost of healthcare puts financial pressure not only on employers, but also their employees. In fact, 89% of employers believe rising healthcare costs are a significant source of financial stress for their employees.


While it’s important for employers to approach their benefit strategy holistically, the survey revealed some key cost-saving measures employers may want to consider.

Firstly, one of the main drivers of growing affordability concerns among both employers and employees is pharmaceutical spending — notably, the increased cost and continued inflation of specialty pharmaceuticals. More employers have been adopting comprehensive solutions, including roughly half of employers evaluating and managing specialty pharmacy spend not only through the Rx benefit, but also exploring opportunities through the medical benefit (projected to grow from 49% today to 85% by 2020).

A couple of strategies have started to emerge among employers. More of them are attempting to offset specialty pharmaceutical costs by influencing the site of care — as the location where care is given can dramatically affect prices. In fact the number of employers that say they plan to implement coverage changes to influence site of care for specialty pharmaceuticals dispensed through the medical benefit over the next few years is more than doubling — from 21% today to 55% by 2021.

Also, a growing number of employers are intrigued by the possibility of biosimilars offering a lower cost option for patients in need of expensive specialty products. That’s why 30% of employers have ensured they have appropriate formulary strategies to leverage biosimilars when available, with another 39% planning to take a more active approach in the next two years.

Another emergent strategy is that more employers continue to make stepwise changes in implementing value-based designs to manage costs year over year, while also driving better health outcomes for their employees. With employees financially strained by the cost of healthcare, employers see an opportunity to steer their staff toward the highest quality affordable healthcare.

There’s a subset of employers diving deeper into new strategies that could help improve access to care beyond the approaches of high-performance networks (growing from 16% to 52% adoption by 2021) and the use of centers of excellence within the health plans (growing from 45% to 74% by 2021), which are reaching a critical mass of employers.

By applying design features or incentives, employers are nudging their employees toward higher value, appropriate care that is sourced efficiently and away from overused, potentially wasteful services. For instance, the proportion of employers slashing out-of-pocket costs to steer employees toward proven services that produce positive health outcomes at a lower price tag will nearly triple over next few years — from 17% today to 46% by 2021.

Also, employers are increasing the out-of-pocket costs for commonly overused and sometimes unnecessary services; adoption of this strategy stands to more than quadruple over the next few years, from 7% today to 35% by 2021.

Employers are also actively reviewing out-of-network coverage and costs. The number of companies reducing out-of-network reimbursements, eliminating non-emergency out-of-network coverage or negotiating full disclosure of all related administrative costs could more than double by 2021.


As employers look to cut costs while enhancing their population’s wellbeing, mental and behavioral health ranked the highest as the top clinical area of focus over the next three years, selected by two in three employers.

The majority of employers are working to build full-blown strategies for a holistic solution to emotional health by redesigning their employee assistance programs to better address emotional and financial wellbeing — expected to jump from 33% to 74% in three years — and building an organization-wide behavioral health action plan (leaping from 25% to 68% in three years).

Stress management strategies are now coming to the fore. The number of employers that are measuring the stress level of their employees is on track to triple by 2021, from 16% to 53%. And building on the 27% of employers that already offer apps to support sleep and relaxation, more than half will implement these programs by 2021 in order to enhance their employee emotional wellbeing. By addressing stress and anxiety before it becomes an expensive clinical need in their population, employers are making a small financial investment to keep costs low down the road.


More than 80% of employers said they are planning to increase their health and wellness budgets this year, more than double compared to 2009 (34%), according to the 10th annual Optum Wellness in the Workplace study released in August.

Employers are increasingly embracing digital technology to engage workers in health and well-being programs. Since 2016, the proportion of employers using health-related mobile apps rose by 46%, with now close to three-quarters of respondents reporting that the apps helped increase employee participation.

Also, the number of employers reporting that their employee wellness programs include the use of fitness or activity devices increased by nearly 40% over the same time period, with 71% of employers reporting successful engagement by their employees.

Benefits Can Be More Important Than Cash for Small-Business Employees

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Source: BenefitsPRO

It’s not an across-the-board finding, but if you ask employees of small businesses how they feel about their benefits, you may be surprised to learn that 87 percent of them would accept additional benefits over a pay raise.

That’s just one finding in a QuickBooks Payroll study that also found the top choice of employees, at 38 percent, for that additional benefit substitution is an extra week of paid vacation.

That’s not to say that they wouldn’t appreciate “fun” benefits, such as free food and drinks, remote work options or flexible work schedules, according to the report; in fact, they say such perks “make them feel more supported and understood in their workplace than companies without these offerings.”

But don’t expect them to hang around long if they’re not happy with their benefits package. Not only do 39 percent of respondents say they’re not satisfied with what’s on offer at their current employer, 35 percent of those who looked for a new job in the past year did so in search of better benefits.

Twenty-nine percent of workers said their companies only provide the bare minimum, and 41 percent said they wouldn’t want to work at a place that provided no benefits such as health insurance, paid vacation and sick days, retirement plans or dental insurance.

And while 66 percent of workers reported getting health insurance benefits, 41 percent of workers said their employers didn’t offer them retirement benefits, such as 401(k)s or pensions. Older workers (39 or older) were more likely to get retirement benefits than younger ones, too, at 45 percent compared with just 34 percent.

Some benefits are more prevalent than others. A surprising 93 percent said they get at least one benefit from their small employer, but what they get and how much of it varies widely; while 57 percent said they get paid time off for vacations, just 48 percent get paid sick leave and 37 percent get paid personal time.

Small business employers considering whether or which benefits to offer might want to keep the following in mind. While 61 percent of small business employees say they feel cared for when companies offer such things as flex time and remote work, 26 percent of employees said they would recommend their company to others if they were offered the right benefits package. Another 21 percent said a great benefits package is what makes them love their job—and that’s not something to ignore in a tight job market.

Boxed In? Warren Confronts Tough Politics of Health Care

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Source: The New York Times

For Elizabeth Warren, it was supposed to be one more big idea in a campaign built around them: a promise that everyone could get government-funded health care, following the lead of her friend and fellow White House hopeful Bernie Sanders. Instead, “Medicare for All” is posing one of the biggest challenges to the Massachusetts senator’s candidacy.

Persistent questions about whether she would raise taxes on the middle class to pay for universal health coverage have dominated her campaign in recent weeks. Warren has refused to answer, arguing that it’s more important to note that overall costs would fall for nearly everyone but large corporations and the wealthy.

That hasn’t quelled the criticism and, recognizing the push for specifics isn’t going away, Warren is promising to soon unveil details about how she would cover the costs of what would be a massive new federal entitlement. The release will test Warren’s ability to navigate the Democratic primary as she balances the demands of progressives who are open to new taxes against skepticism from moderates who say such levies would doom her in a general election.

“She’s trying to thread the needle between the electorate that wants a simple answer and the facts that she knows and that she has to live with at some point down the road,” said Jim McDermott, a former Democratic congressman from Washington state who spent most of his career trying to move a “single-payer” plan.

With the first votes just over three months away, Warren could leave many disappointed.

If she aligns with Sanders, who acknowledges taxes will have to go up, she could further alarm Democrats worried she’s pushing the party too far to the left. If she doesn’t, that could alienate progressives who may accuse her plan of not going far enough. And any combination of the two might leave virtually everyone else still confused — wondering how to make the program’s eye-popping math work.

That Warren is having to address health care questions on such starkly political terms may recall another, early campaign test she flunked: releasing the results of a DNA test last fall. Meant to quiet critics who questioned her past claims to Native American heritage, the move angered tribal leaders and energized critics like President Donald Trump who still gleefully deride Warren as “Pocahontas.”

Warren says that, far from having boxed herself in politically, she’s been working on her health care plan for months and still sees it as a winning issue. Her campaign has consulted experts, is reviewing Sanders’ funding options on universal coverage going back to his 2016 presidential run and says it will always stay true to Warren’s promises that health care costs rise for the rich and big firms while falling for “hard-working families.”

One expert Warren’s team has consulted is Robert Pollin, a University of Massachusetts Amherst economist who supports Medicare for All and has called for partially helping to pay for it using a sales tax.

“We should all pay something,” said Pollin, who is a past donor to both Warren and Sanders but declined to discuss the specifics of his conversations with Warren’s campaign. “You’re going to get health care with no premiums, no deductibles, no fear of bankruptcy if you have a health emergency.”

Warren has refused to commit to the idea of everyone paying a little. But presenting the payment specifics she’s promised means necessarily grappling with the possibility of higher overall costs for the program, since making health care free for the patient would encourage people to use more services.

Sara Collins, vice president for coverage and access with the nonpartisan Commonwealth Club, said the key involves changing how the health care tab is divided up among employers, government and individuals.

“The overall growth in spending isn’t that great, but it’s the ‘Who pays for it?’ that really changes,” said Collins, adding that costs would shift to the federal government, meaning “taxes will likely have to go up.”

More pitfalls may emerge as the Warren campaign tries to estimate Medicare for All’s cost. Since the final product would have to be approved by Congress, its contents are impossible to predict. A study released last week nonetheless estimated the government would need $2.7 trillion for Medicare for All to be fully implemented next year — more than half the current federal budget.

Sanders’ campaign estimated that the universal health coverage plan he first introduced in 2016 would cost $14 trillion over the next decade. His estimates for the current race are far higher, though he now wants to offer more coverage.

Unlike Warren, Sanders has already released payment options, including higher taxes on wealthy Americans and an employee payroll tax of 7.5%. But he’s also suggested a 4% “premium” on income that kicks in after the first $29,000 for a family of four — very much affecting the middle class.

Warren could possibly avoid that by imposing co-pay rules or limiting what’s covered. Her plan may institute payroll taxes to transfer what employers already spend on employee health care through private insurance to government-run Medicare for All. But that would give federal authorities more control over employee health costs than employers, potentially affecting jobs.

“If your plan for health care involves the perception, even if it’s not reality, that you’re going to take away something that people have worked very hard to maintain — then it would be very problematic,” said Brandon Dillon, former chairman of the Michigan Democratic Party.

Warren’s predicament is striking since she emerged as a front-runner alongside former Vice President Joe Biden by proudly “having a plan” for everything but arguably the 2020 race’s top issue. She’s also spent months deftly floating above questions about paying for her other ambitious proposals, including offering universal child care and tuition-free education at public universities while canceling existing student debt, by proposing a wealth tax on the ultra-rich. That proposal effectively became a piggy bank to cover the costs of her other promises.

The wealth tax won’t be enough to pay for Medicare for All, though. Warren’s avoidance of the middle-class tax question has helped the issue linger as a political liability — and not just in Washington political circles.

Peter Schweyer, a Democrat in Pennsylvania’s House of Representatives who is undecided in the presidential race, called pointed questions of Warren over Medicare for All during last week’s presidential debate “really good.”

“She’ll need to figure out how to respond,” Schweyer said.

Budget Watchdog Group Outlines ‘Medicare for All’ Financing Options

Image result for Budget Watchdog Group Outlines ‘Medicare for All’ Financing Options image

Source: The Hill

The Committee for a Responsible Federal Budget (CRFB) on Monday released a paper providing its preliminary estimates for various ways to finance “Medicare for All,” as the issue of how to pay for such a health plan has taken center stage in the Democratic presidential primary.

“Policymakers have a number of options available to finance the $30 trillion cost of Medicare for All, but each option would come with its own set of trade-offs,” the budget watchdog group wrote.

The issue of how to pay for Medicare for All — single-payer health care that eliminates premiums and deductibles — has become a key discussion topic in the Democratic presidential race.

Sen. Elizabeth Warren (D-Mass.), one of the top tier 2020 hopefuls, recently said that she would release a financing plan for her Medicare for All proposal after being criticized by some of her rivals in the primary race for refusing to give a direct answer about whether she’d raise taxes on the middle class to pay for the massive health care overhaul.

CRFB said most estimates find that implementing Medicare for All would cost the federal government about $30 trillion over 10 years.

“How this cost is financed would have considerable distributional, economic, and policy implications,” the group wrote.

CRFB provided several options that each could raise the revenue needed to pay for Medicare for All. These included a 32 percent payroll tax, a 25 percent surtax on income above the standard-deduction amount, a 42 percent value-added tax, mandatory premiums averaging $7,500 per capita, and more than doubling all individual and corporate tax rates.

The group estimated that Medicare for All could not be fully financed just by raising taxes on the wealthy.

CRFB also estimated that Medicare for All could be financed by cutting all nonhealth spending by 80 percent, or by more than doubling the national debt, so that it increased to 205 percent of gross domestic product.

The group said that the financing options it listed could be combined, or that policymakers could reduce the cost of Medicare for All by making it less generous.

“Adopting smaller versions of several policies may prove more viable than adopting any one policy in full,” CRFB wrote.

CRFB said that most of the financing options it listed would on average be more progressive than current law, but most of the financing options would also shrink the economy.

Last Updated 11/13/2019

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