Appeals Court Skeptical of Trump Rule On TV Drug Ads

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Source: The Hill, by Jessie Hellmann

Drugmakers and the administration headed to court Monday in a fight over a Trump rule that would require companies to disclose the list prices of their drugs in television advertising.

Three drug companies — Merck, Eli Lily and Amgen — argue the rule, which was blocked by a federal court in July, is outside the authority of the Department of Health and Human Services (HHS).

The Trump administration urged a federal appeals court Monday to overturn that ruling, arguing it has the authority under the law to run the Medicare and Medicaid programs efficiently. The health care programs for the elderly and the poor paid about $240 billion for prescription drugs in 2016.

But the three-judge panel of the U.S. Court of Appeals for the D.C. Circuit sounded skeptical in its grilling of government lawyers, questioning the agency’s authority to issue the rule and whether the disclosure of list prices, which are often higher than what patients end up paying, would be helpful to consumers.

“The problem is the cost of prescription drugs. I don’t see this as a solution to the problem,” said Judge Karen LeCraft Henderson, an appointee of former President George H.W. Bush.

The list price “is not the price I’ll ever pay. Why is that not adding confusion?”

The other two judges who heard arguments on Monday are Patricia Millett, an Obama appointee, and Harry T. Edwards, a Carter appointee.

The case represents another high-stakes test for President Trump’s drug pricing agenda, which mostly relies on administrative action and rulemaking.

While lowering drug prices has been a top initiative for the president, most of his plans have had trouble getting off the ground.

The administration has conceded in the past that it needs more authority from Congress to act on drug prices, but an agreement between the Democratic House and Republican Senate has proven difficult.

The advertising rule, which would only apply to drugs that cost at least $35 a month and are covered by Medicaid and Medicare, would force drug companies to compete and encourage patients to shop for better deals, potentially driving down prices, said Ethan Davis, a Justice Department attorney representing HHS in its case.

A drug’s list price is not usually public information.

“This lack of transparency threatens Medicare and Medicaid’s sustainability and comes at the expense of American taxpayers,” the government wrote in its brief.

But the judges questioned those claims, noting that Congress has not passed a specific law directing HHS to require drug companies to disclose prices in advertising.

They also worried the ads could cause confusion because the list price, which is set by drug manufacturers, often isn’t what patients actually pay for their drugs after insurance is taken into account.

That was the argument made by drug companies, with the attorney representing them, Richard Bress, telling the court Monday the rule could be “far more dangerous than helpful” if it takes effect.

Patients that view a list price as too high might stay away from it, even if it could help their condition, drug companies argue.

Davis, of the Justice Department, agreed.

“Consumers lose interest in higher-priced drugs,” he said. But he added that should give companies incentive to lower their list prices.

The administration also argued the list price has a relationship to what patients end up paying; drugs with a higher list price could also have a higher copay or coinsurance, Davis said.

“It doesn’t tell you what you’ll actually pay … but gives you a good idea of whether you’ll pay more or less,” Davis said.

Still, HHS and the Justice Department face a high hurdle in getting the appeals court to overturn the ruling issued by U.S. District Judge Amit Mehta, an Obama appointee, in July.

Mehta wrote in his ruling that HHS’s authority to issue rules is not “unbounded.”

“No matter how vexing the problem of spiraling drug costs may be, HHS cannot do more than what Congress has authorized,” Mehta wrote. “The responsibility rests with Congress to act.”

The rule is also opposed by broadcasting and advertising groups. The drug industry spends billions on television ads each year, with prescription drugs accounting for a high percentage of it.

The rule, though, has support on Capitol Hill among lawmakers from both parties. Sens. Dick Durbin (D-Ill.) and Chuck Grassley (R-Iowa) have sponsored a bill that would require price disclosures in drug advertisements, but the path forward for their legislation is uncertain.

Durbin has asked for unanimous consent to pass the bill, meaning it would not require a roll call vote, but it has been objected to by some Republicans.

Lawmakers are also pushing other measures on drug prices.

A bill sponsored by Grassley and Sen. Ron Wyden (D-Ore.) would cap the price increases drug companies typically make every year. That bill is supported by Trump but opposed by Senate Republicans.

Meanwhile, the administration is preparing to finalize a rule that would allow some states to import cheaper prescription drugs from Canada.

The rule is fiercely opposed by the drug industry and is likely to also face legal action.

After Years of Financial Woes, Los Angeles Hospital Running Out of Prayers

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Source: Los Angeles Times, by Alejandra Reyes-Velarde

Many years ago, Gilbert San Juan watched as a wrecking ball demolished the old St. Vincent Medical Center.

An elevator operator and painter there at the time, San Juan wanted to fetch some old furniture from the building, but backed down after seeing the massive, threatening ball hanging from a crane.

Still, he knew he would enter its doors again, when the new hospital near downtown Los Angeles sprung just yards away from the old. For 47 years, San Juan worked in that facility.

So it hasn’t quite hit him that the hospital might actually shutter for good after its owners announced that a sale fell through, he said. Verity Health asked a bankruptcy court for permission to close its doors. A judge gave approval for the closure last week.

“They’re going to have to call the SWAT team to get me out of here,” San Juan joked as he walked through the hospital hallways.

Pointing at a sepia-toned framed photograph of the old building labeled “1927,” San Juan declared: “It was beautiful.”

St. Vincent Medical Center on 3rd and Alvarado streets was founded in 1858 by the Daughters of Charity — six nuns who wanted to offer services to the poor and saw a need for healthcare in a growing L.A.

Now, several hundred patients will need to be transferred to nearby Good Samaritan Hospital and St. Francis Medical Center. Community leaders and experts fear the hospital’s closing will have a ripple effect throughout the community and force the poor and elderly to travel farther away for care.

About 1,000 people, including San Juan, work at the hospital and it is unclear what will happen to those jobs.

Throughout the decades, the mission of the hospital to serve the most needy remained consistent. St Vincent Medical Center’s “disproportionate share percentage” is 70%, which means it serves mostly low-income patients who rely on Medicare and Medicaid, said John Romley, associate professor of pharmaceutical and health economics at USC.

The hospital leans heavily on Medicaid and Medicare, which reimburses the hospital at lower rates than commercial insurance, according to experts. It sits in a working-class, predominantly Latino neighborhood with large Mexican and Central American immigrant populations.

The hospital’s community work had decreased over the years as its financial problems worsened, but it had a history of working with organizations such as the Central American Resource Center, or CARECEN, to offer health screenings and general checkups for free to the area’s immigrant and day laborer communities.

“Having institutions that are anchored in a community such as Westlake and Pico Union are critical to the continued growth and strength of an area,” said CARECEN’s executive director Martha Arevalo. “When we lose those anchors, that has a tremendous ripple effect.”

In its early days, the Daughters of Charity offered care for $1.50 per day to the working class: fishermen, shop owners, stable keepers and watchmakers. Doctors treated pneumonia, typhoid and malaria they said was brought by “newcomers, not wearing sufficiently heavy clothing, particularly in the evening,” according to a Los Angeles Times article in 1887.

According to its website, doctors at St. Vincent Medical Center would later become the first to perform an open heart surgery on the West Coast, the first to offer hemodialysis to kidney failure patients, the first to perform an artificial heart implant and the first to perform a human heart transplantation.

As L.A. prospered, so did the hospital. An 1885 article in The Times boasted of the hospital’s views of the city and far-off orange groves and vineyards from its sparkling new building on Beaudry and Sunset: “The valley can be seen for from thirty to forty miles south and east, and on clear days the ocean plainly appears.

“As a public institution, it is without an equal south of San Francisco,” the article read.

But financial woes soon trailed the hospital.

The Daughters of Charity racked up debt to construct new facilities. When the hospital moved to its current location on Third and Alvarado in the 1920s, one Times article noted the nuns were “unable to accumulate the capital to defray the cost of the institution” due to the thousands of patients who received care “without the payment of even a moderate fee.”

In recent years, the hospital had changed ownership several times, though that’s not unusual in today’s market-driven healthcare landscape, according to experts.

Among the creditors in the bankruptcy is the hospital system’s former management company, Integrity Healthcare, controlled by entrepreneur-physician Patrick Soon-Shiong’s company NantWorks. Soon-Shiong also owns The Times.

Verity, the nonprofit operator of six California hospitals, filed for bankruptcy protection in 2018. At the time, officials said the company had more than $1 billion of debt from bonds and unfunded pension liabilities and needed cash to make seismic repairs to its aging facilities. They said they’d purchased the hospitals in 2017 hoping to get back to financial health but could not.

The bankruptcy sparked concerns in communities about the fate of the hospitals. Santa Clara County has taken over operations of two of the hospitals — O’Connor Hospital in San Jose and St. Louise Regional Hospital in Gilroy. The move came after the California attorney general demanded oversight of the transfer.

St. Francis Medical Center in Lynwood has also been the subject of debate, because of its importance to the southeast Los Angeles County region. Lynwood officials last year even discussed purchasing the medical center.

Verity said last week it would continue operating St. Francis as well as Seton Medical Center and Seton Coastside in San Mateo County.

St. Vincent Medical Center (which is not related to the New York health system of the same name) is home to the Asian Pacific Liver Center, which focuses on Hepatitis B awareness, screenings and care for the Asian American population, which is disproportionately affected by the disease.

The hospital’s volunteer department has for years supported operations and deployed people to participate in organizations such as Meals on Wheels.

Through a spokeswoman, Verity Health declined to allow longtime staff members and heads of these organizations to speak to a Times reporter.

St. Vincent’s isn’t the only hospital to face financial challenges. There has been much variability in the healthcare industry in terms of ownership changes and mergers, Romley said. Between 25% and 30% of all California hospitals are operating at a loss. St. Vincent Medical Center, lost $67 million in 2018, he said.

“This organization has been in some turmoil for some time,” Romley said. “It’s been heading in this direction for a while.”

It’s the neediest populations that are often more at risk of losing their hospitals. According to a study on trauma centers by UC San Francisco researchers, emergency rooms in hospitals located in low-income neighborhoods are 1.5 times more likely to close and those patients are affected more severely than other areas.

When the Martin Luther King Jr. Hospital closed in 2007, the number of uninsured patients that one local hospital treated tripled from 12.9% in 1999 to 44.6% in 2009, according to a 2016 study co-authored by Renee Hsia, a professor in the Department of Emergency Medicine at UC San Francisco.

When a hospital closes its emergency room and its patients are diverted to the next closest hospital, both the patients being transported and the patients who were already receiving care in the hospital experience higher mortality rates, Hsia said.

She cited a mix of factors, including longer distances patients need to travel to receive care and overcrowded hospitals.

“Peoples’ emergencies don’t go away when an ER closes,” Hsia said. “There is a very real and documented domino effect, especially in areas where there is need.”

“It’s important people realize the supply of hospitals is not regulated,” she added. “Hospitals can decide whether to open and close where and when they want.”

Verity Health has said patients in need of emergency care will be directed to eight hospitals within a three-mile radius of St. Vincent Medical Center, although it didn’t name which hospitals.

Good Samaritan, a 408-bed hospital also in the Westlake neighborhood, has a 70% disproportionate share percentage and lost $8 million in 2018. St. Francis Medical Center, which has 384 beds, did not suffer losses in 2018, but 100% of its patients are low-income.

Teresa Henrique, 75, who has gone to St. Vincent Medical Center for years, said she didn’t know the hospital would be closing.

“I’ll have to find a new hospital,” she said. “I’ll have to see if they’ll take my insurance. They treated me really well at [St. Vincent Medical Center]. I like it.”

Kay Kim, 65, said she has relied on the hospital for emergency care, for herself, her parents and other family members. It was where both her parents, Korean immigrants, died.

“It’s close to where I live,” she said. “Whenever I have an emergency, I come here. I hope someone else buys it. That’s very sad.”

At the hospital’s “Cafe on 3rd” last week, employees whispered about the closure. A maintenance supervisor tapping on his phone announced he was being ordered to redo the coverings for the emergency room signage.

“We leave the 24th,” said one woman in the hospital’s cafe. “Well be the last ones out.”

Que tristeza,” a cafe employee told colleagues in Spanish. What a shame.

One employee fretted about being without work for an extended time.

Carlos Bueno, the maintenance supervisor, said his company will stay behind after the hospital’s closure, but some co-workers are already tweaking their resumes.

As he covered signs around the hospital, he saw staff members congregate in groups taking photos. For the memories, he guessed.

Elpidio Villaneda, who in March would have reached his 30-year work anniversary at the hospital, said it has been his second home.

“I thought the city or something would jump in,” Villaneda said. “It’s a landmark, you know? We could use another hospital. There’s enough people here to support it.”

“Everybody is sad, everybody is down right now,” Bueno said.

Huddled around a cafe table, San Juan took out his phone to play a song, “Todo Tiene Su Final.”

“Like Willie Colon and Hector Lavoe say, everything comes to its end,” San Juan said.

Congress’ Health Agenda Barrels Toward 2020 Buzz Saw

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Source: Politico, by Adam Cancryn and Alice Miranda Ollstein

Republicans and Democrats have a narrow opening to cut big deals on drug pricing and surprise medical bills and address two key concerns of voters — just in time for 2020 electoral politics to drive them apart.

Congressional leaders are feeling renewed urgency to do something about the high-profile issues, but they fear impeachment and escalating tensions with Iran could swamp the legislative agenda. And on drug pricing, both sides are reluctant to let the other claim victory on a pocketbook issue that recent polling shows ranks high among voter concerns.

The efforts to deliver on these priorities are also colliding with the broader partisan battle over health care that could hold the key to the presidency.

The first test is likely to come within weeks, when a bipartisan group of House members will meet to try to break a lengthy impasse and finalize plans for protecting patients from being charged thousands of dollars if they get out-of-network care. The effort enjoys widespread support but stalled last year amid fierce battles between insurers, employers and well-funded providers over who would pay for a fix.

“The agreement is that something should be done about each of those issues, but there is great debate about what it is,” said Rep. Lloyd Doggett, a Texas Democrat who chairs the House Ways and Means Health Subcommittee. “[2020] is probably more campaign speeches than serious bipartisan policymaking.”

That would be fine with some well-financed interest groups still eager to influence the debate. Doctor Patient Unity — a dark money group largely funded by two private equity-backed physician staffing companies — was the most prominent of the outside groups to spend heavily to influence the surprise billing debate, dropping more than $53 million on ads over the last half of 2019 to attack a leading surprise billing fix, according to Advertising Analytics.

Congressional leaders blocked an effort to revive the legislation as part of a year-end spending package, instead setting a May deadline for lawmakers to work out an agreement.

“A lot of concerns were expressed” by health care interests since the Senate HELP Committee approved a surprise billing fix in June, said Sen. Tim Kaine (D-Va.). “You hold the patient harmless, but then you allocate the responsibility to providers and insurers. And maybe the allocation was a little more okay with the insurers than the providers. Now we’re back to work to see if we can calibrate it to hit the right balance in the allocation of responsibility.”

The new May deadline — tied to the expiration of funding for several health programs — should give House and Senate negotiators time to iron out the details of legislation that can speed through Congress and retain White House support, lawmakers involved said.

Yet it will also invite a fresh round of high-pressure lobbying that could test vulnerable lawmakers in the House, and give skeptics nearly five months to build a case against a compromise.

Speaker Nancy Pelosi in her end-of-year open letter to the House Democratic Caucus said a top 2020 priority is “ending the financial unfairness of surprise billing.” A senior House Democratic aide told POLITICO the letter was a message to the Energy and Commerce and the Ways and Means committees — whose jurisdictional battle over the issue helped derail any potential action in 2019 — to “figure it out and get this done.”

Senate Majority Leader Mitch McConnell, meanwhile, has not yet said whether he’d bring surprise billing legislation up for a vote, even if House and Senate negotiators reach a deal. Senate Democratic Leader Chuck Schumer of New York remains hesitant as well, amid intense pressure from his powerful home state hospital lobby.

“I’m going to do everything I can to keep surprise medical billing on the front burner between now and May,” said Senate HELP Chairman Lamar Alexander (R-Tenn.), who has made resolving the issue a top goal before he retires this year. “It’s a bill almost everyone wants passed, except a handful of people and the private equity firms that benefit from it.”

Congress faces an even bigger partisan gulf on drug pricing as Democrats and Republicans feature the issue prominently in their 2020 health care agendas. A bipartisan proposal negotiated between Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.), the chairman and ranking member of the Finance Committee, has gained little traction despite backing from Trump administration officials, with party leaders more intent on accusing each other of inaction as they fight for control of the Senate in 2021.

Senate Republicans led by McConnell balk at a provision in Grassley and Wyden’s bill that would finedrugmakers that hike prices beyond the rate of inflation, deriding it as a path to price controls.

Leadership’s opposition to holding a vote has turned up the acrimony, with Grassley frequently taking to Twitter to try to enlist President Donald Trump’s help and Wyden repeatedly accusing McConnell of shielding the pharmaceutical industry.

Pelosi and top House Democrats, meanwhile, are insisting that any major drug price deal authorize the government to directly negotiate drug prices — a longtime liberal priority that’s a nonstarter with Republicans.

“My view is that if we don’t have negotiated prices, we’re not accomplishing much,” said House Energy and Commerce Chairman Frank Pallone (D-N.J.).

Though some centrist lawmakers have sought to pass narrower bipartisan measures addressing drug pricing that could boost their own congressional campaigns, House Democratic leaders are signaling they’ll spend much of the year touting their ambitious drug pricing overhaul passed last year — and pressuring Senate Republicans to get on board.

Aside from action on those issues, lawmakers say a pile of unfinished health care business and a slew of investigations several committees launched last year will fill out the health care agenda.

Democratic aides expect the results of an inquiry into whether companies are deceptively marketing short-term health insurance policies promoted by the Trump administration — which critics deride as “junk plans” because of the skimpy coverage — to be released within weeks, including data from the open enrollment period that recently ended. Lawmakers also plan to keep investigating CMS Administrator Seema Verma’s use of private contractors, how states are spending the billions of dollars of funding Congress gave them to address the opioid epidemic, and the Trump administration’s treatment of thousands of separated migrant children.

“We want to know what HHS knew and when they knew it,” a senior Democratic staffer told POLITICO.

Trump’s health department has maintained that all of its decisions were proper and in line with long-standing practices.

House committees are also waiting on responses from pharmaceutical companies about why they raised their prices so much over the last few years, from e-cigarette manufacturers about their marketing practices and internal research on the public health impact of vaping, and from private equity firms about their involvement in the campaign to squash surprise billing reforms.

The Trump administration’s recent walkback of past promises to ban all favored e-cigarettes also has Democratic lawmakers in both chambers seeking further legislative action.

But there’s little confidence much will make it through the GOP-controlled Senate, especially as the presidential campaign heats up.

Trump has already made health care a key element of his rallies, boasting about gutting parts of Obamacare while deriding the “socialist” push for a single-payer system. At the same time, Democrats are confident that a combination of touting their policies to expand coverage and lower drug prices with sustained attacks on Republicans’ moves in court and Congress to roll back the Affordable Care Act will yield the kind of results that flipped control of the House in 2018.

“It’s so polarizing,” said Sen. Rick Scott (R-Fla.). “I think people, because it’s so polarizing, are scared to do anything. And they don’t have to right now. There’s no pressure up here.”

Federal Court Temporarily Halts California Dialysis Profits Law

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Source: Healio

A federal court in California has granted a preliminary injunction to prevent Assembly Bill 290, which is aimed at limiting dialysis provider profits and premium assistance, from taking effect.

“Considering both the likelihood that A.B. 290 will abridge plaintiffs’ constitutional rights and the extreme medical risks it poses to thousands of [end-stage renal disease] patients, the court finds it obvious that the public interest favors a preliminary injunction, and that the balance of the hardships tilts strongly in plaintiffs’ favor,” the court said in its ruling released Dec. 30.

“I am extremely disappointed to read the court’s order granting the plaintiff’s motions for a preliminary injunction of A.B. 290,” California Assemblyman Jim Wood, D-Santa Rosa, said in an email statement to Healio/Nephrology. Wood is the author of the legislation that was signed by California Governor Gavin Newsom on Oct. 13. 2019.

“It has been my goal to ensure that every Californian has health care, and to do so requires our efforts to contain increasing health care costs that are making coverage unaffordable for many. This injunction is consequential because it emboldens the corporate duopoly of Fresenius and DaVita to continue to gouge the health care system in order to increase their profits,” Wood said.

The court order also provides a reprieve for the American Kidney Fund. The organization had sent letters to patients on dialysis in California who receive premium assistance through its Health Insurance Premium Program, which is funded by dialysis providers, that it would no longer cover those premiums starting Jan. 1, 2020. A.B. 290 required the AKF reveal the names of patients and the providers who were covering the premiums.

The legislation would have restricted payment to dialysis providers by commercial health plans for patient care to no more that the current Medicare rate. Dialysis providers Fresenius Medical Care and DaVita Inc. had spent more than $1 million during the last 2 years trying to defeat the bill, along with a ballot measure in November 2018. That measure was defeated by California voters.

“We are pleased that the court has issued an injunction enjoining A.B. 290, which will enable our patients, who need charitable assistance to afford their health insurance premium, to continue to access such resources,” Brad Puffer, spokesperson for Fresenius Medical Care North America, said in a statement emailed to Healio/Nephrology. “Our focus remains on providing the highest quality of care for our patients and we will continue to advance those efforts despite work by the California legislature to restrict financial assistance.”

“Today, the American Kidney Fund (AKF) joins 3,700 low-income Californians living with kidney failure in applauding the decision by Judge David Carter in the U.S. District Court for the Central District of California to grant an emergency injunction preventing A.B. 290 from becoming law,” LaVarne A. Burton, president and CEO of the American Kidney Fund, said in a statement. “This is important news for patients with kidney failure who depend upon AKF to ensure access to the health care that they must have to survive.

“Because this injunction prevents A.B. 290 from becoming law, pending the outcome of a trial, AKF can continue to serve California’s low-income dialysis and transplant patients who depend on AKF for charitable premium assistance. We will also immediately re-open the program to new grant applicants who qualify for assistance.”

In November, the AKF, Dialysis Patient Citizens (DPC) and two patient plaintiffs filed a suit in federal court in California asserting numerous constitutional challenges against A.B. 290. Fresenius, DaVita and U.S. Renal Care have separately filed suit in the same court, also challenging the constitutionality of A.B. 290.

“On behalf of our patients, we are pleased that the court took the important step of putting a hold on the implementation of Assembly Bill 290, a law that threatens to harm nearly 4,000 low-income, primarily minority Californians on dialysis,” DaVita Kidney Care said in a statement. “While this is a temporary victory for California dialysis patients, we will continue to advocate on their behalf and remain focused on providing high-quality care.” The California Medical Association and the California State Conference of the NAACP filed amicus briefs in support of enjoining A.B. 290 as unconstitutional.

“We are truly grateful to the court for grating so many vulnerable dialysis patients this temporary reprieve,” the CEO of DPC, Hrant Jamgochian, JD, LLM, said in the release. “We know that A.B. 290 still threatens more than 3,700 of the poorest and sickest dialysis patients in California. Health insurance coverage is absolutely critical for patients to continue their dialysis treatments, and if they can’t maintain it, their lives are literally on the line. That is why DPC joined as a plaintiff in this critical litigation, and why we hope this repugnant law never takes effect.” – by Mark E. Neumann

5 Trends and Issues to Watch in the Insurance Industry in 2020

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Source: FierceHealthcare, by Robert King

The insurance industry appears likely to have another big year in 2020, as growth in government and commercial markets is expected to continue.

But a presidential election and new transparency initiatives could throw some major curveballs to payers.

Here are the top five issues and trends to watch out for in the next year:

Medicare Advantage diversifies

Enrollment growth in Medicare Advantage is likely to continue next year, as more than 22 million Medicare beneficiaries already have a plan. But what will be different is diversification into new populations, especially as insurers pursue dually eligible beneficiaries on both Medicare and Medicaid.

“This is being made possible because of strong support from government,” said Dan Mendelson, founder of consulting firm Avalere Health.

Support for Medicare Advantage “transcends partisanship and that has been true under Trump and Obama,” he added.

New benefit designs, such as paying for food or transportation to address social determinants of health, are also going to increase in popularity. The Centers for Medicare & Medicaid Services (CMS) has made it easier for plans to offer such supplemental benefits.

Get ready for transparency, whether you like it or not

This past year saw CMS release a major rule on transparency that forces hospitals to post payer-negotiated rates starting in 2021 for more than 300 “shoppable” hospital services.

The rule, which is being contested in court, could fundamentally change how insurers negotiate with hospitals on how to cover those services. The rule brings up questions about revealing “private information for the sake of transparency,” said Monica Hon, vice president for consulting firm Advis.

But it remains unclear how the court battle over the rule, which has garnered opposition from not just hospitals but also insurers, will play out. Hospital groups behind the lawsuit challenging the rule have had success getting favorable rulings that struck down payment cuts.

“I think there is going to be a lot of back and forth,” Hon said. “Whatever the result is that will impact how payers and providers negotiate rates with this transparency rule.”

Don’t expect major rules in 2020

2020 is a presidential and congressional election year, and traditionally few major initiatives get going in Congress. But experts say the same goes for regulations as administrations tend not to issue major regulations in the run-up to the vote in November, said Ben Isgur, leader of PwC’s Health Research Institute.

“What we will end up with is much more change on regulations on the state side,” Isgur said.

But new regulations on proposals that have been floated could be released. Chief among them could be a final rule to halt information blocking at hospitals and a new regulation on tying Medicare Part B prices for certain drugs to the prices paid in certain countries.

Congressional lawmakers are still hoping to reach a compromise on surprise billing, but they don’t have much time before campaigning for reelection in November.

A lot of the healthcare direction will be set after the presidential election in November. If a Democrat defeats President Donald Trump, then waivers for items like Medicaid work requirements and block grants will likely go by the wayside.

“Depending on who takes the White House and Congress, are we going to further repeal the Affordable Care Act and replace it or will we have Medicare for All,” Isgur said.

Insurers continue to go vertical in dealmaking

Insurers certainly weren’t shy about engaging in mergers and acquisitions in 2019, and that trend doesn’t appear likely to dissipate next year.

But the types of mergers might be different. Insurers and providers are increasingly looking at deals that would offer a vertical integration, such as acquiring more pharmacy services or a technology company to enhance the patient experience. Plenty of big-ticket vertical deals, such as CVS’ acquisition of Aetna and Cigna’s purchase of Express Scripts, have changed the industry landscape significantly.

“Deals in 2020 are going to be much more around the identity,” Isgur said. “Five years ago we had a lot of horizontal deals where health systems got bigger and regional payers got bigger.”

Payers continue to push patients away from hospitals

Insurers are going to try to find new ways to push patients toward outpatient services to avoid higher costs from going to a hospital.

For instance, “we are seeing a lot of payers not going to honor hospital imaging,” said Hon. “A lot of payers are saying we want you to go outside the hospital and that is a lot cheaper for us,” she said.

Instead, payers will try to steer patients toward imaging centers or physicians’ offices.

“We are seeing that with imaging and free-standing surgical centers now being able to do a lot more,” she added.

Insurers are also starting to use primary care more proactively to “ensure that they understand the needs of the patient, their needs are being addressed,” Mendelson said.

5 Health Care Fights to Watch in 2020

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Source: The Hill, by Peter Sullivan and Jessie Hellmann

Advocates hope lawmakers can beat the odds and move major health care legislation in the new year.

2019 opened with bipartisan talk of cracking down on drug prices and surprise medical bills. But it ended without major legislation signed into law on either front, and a host of other health care battles, including a lawsuit threatening the entire Affordable Care Act, looming over the coming election year.

Here are five health care fights to watch in 2020.

Drug pricing

Lowering drug prices was supposed to be an area for potential bipartisan action in 2019, but the effort ran into a brick wall of industry lobbying and partisan divisions.

There is a push to finally get legislation over the finish line in 2020, though.

Speaker Nancy Pelosi (D-Calif.) is calling for attaching drug pricing legislation to a package of expiring health care programs, like community health center funding, that must be renewed by May 22. She hopes the pressure from that deadline helps carry a larger package, but that is far from certain, especially as the election gets closer.

Democrats point to President Trump’s vow to support allowing the government to negotiate drug prices during his 2016 campaign. While Trump backed off that pledge this year, they hold out hope he might come back around. Senate Majority Leader Mitch McConnell (R-Ky.) is also strongly opposed to the idea, and has concerns about a more modest bill from Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.) that could provide a more realistic bipartisan path.

“The president said when he ran and until relatively recently that he would support negotiated prices and I expect at some point he will go back to that, and we’re just going to keep pushing the Senate to try to achieve that,” said House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.).

Surprise billing

The other major health care initiative that Pelosi says she wants in the May package is protecting patients from surprise medical bills.

That effort has also fallen prey to intense industry lobbying and congressional infighting.

Backers of a bipartisan bill from the House Energy and Commerce Committee and Senate Health Committee on the issue pushed for including the measure in a year-end spending and were deeply frustrated when it was left out.

A key factor was House Ways and Means Committee Chairman Richard Neal (D-Mass.) putting forward the outline of a rival plan days before this month’s funding deadline, showing a split on the way forward.

“It’s certainly going to be harder [next year],” said Shawn Gremminger, senior director of federal relations at Families USA, a liberal health care advocacy group.

“You are now under six months out from the general election,” he said about moving legislation in May 2020.

Backers have a tough road ahead. They will have to bridge the divide between the competing plans and overcome lobbying from powerful doctor and hospital groups, who worry the legislation could lead to damaging cuts to their payments.

ObamaCare

Outside of Capitol Hill negotiating rooms, the GOP lawsuit to overturn the Affordable Care Act is looming large.

A federal appeals court last week issued a long-awaited ruling on the fate of the law, though it did little to settle the issue. The 5th U.S. Circuit Court of Appeals ruled that the law’s mandate to have health insurance is unconstitutional, but punted on the question of whether any of the rest of the law should also be struck down, instead sending it back to the lower court.

The most tangible effect of the move could be to push a final Supreme Court decision on the fate of the law past the 2020 elections, though it’s possible the justices could still choose to take the case sooner.

Democrats intend to hammer Republicans over the lawsuit during next year’s campaign, though, a strategy that paid off for the party during the 2018 midterms when they focused on health care.

The Democratic group Protect Our Care launched a national TV ad on Friday, saying “President Trump and Republicans just won a major decision in their lawsuit to repeal health care from millions of American families,” and warning of the loss of pre-existing condition protections.

Medicare for All

In the Democratic presidential race, “Medicare for All” is a central dividing line.

How the issue plays out in 2020 will depend in large part on who wins the Democratic nomination. If progressives like Sens. Bernie Sanders (I-Vt.) or Elizabeth Warren (D-Mass.) win the nomination, Republicans will be able to go full bore on their attacks that private health insurance would be eliminated under the proposal.

Even more moderate candidates like former Vice President Joe Biden and South Bend, Ind., Mayor Pete Buttigieg would face attacks that their public option plans are a step down the road toward eventually implementing full-scale single payer.

The internal debate on the issue has faded somewhat from its peak. Health care has not featured as prominently in the last two debates, and some of the fighting has shifted to other areas, like candidates’ fundraising practices.

But the issue is still simmering and could burst back to open warfare among Democrats at any point.

Vaping

The battle over e-cigarette flavors will likely resume in 2020 as the Trump administration and Congress try to cut rising youth vaping rates.

Public health advocates are pushing the administration to clear the market of flavors like mint and fruit that they argue are fueling a youth vaping epidemic.

Trump said he would eliminate those flavors in September, but has appeared to back down after backlash from vaping advocates and the e-cigarette industry.

Now he says he would like to find a compromise that preserves such flavors for adults while keeping them away from kids.

Advocates like the Campaign for Tobacco-Free Kids plan to pressure Trump to follow through on his word, though it’s looking unlikely.

However, the e-cigarette market could also look vastly different after May 2020, when companies must apply to the Food and Drug Administration to stay on the market

The industry must prove its products benefit public health, a big ask for companies like Juul, whose products are favored by kids who vape.

House Democrats also plan to vote on a bill that would ban flavored e-cigarette and tobacco products, but it’s not clear if it will get a vote in the Senate.

Democratic candidates debate practicality of Medicare for All

Democratic presidential candidates

Seven candidates participated in the sixth Democratic debate on Thursday, and conversations about health care included discussions about the practicality of a Medicare for All framework backed by Sen. Bernie Sanders, I-Vt. Former Vice President Joe Biden said the single-payer concept is unrealistic and that it would cause taxes to skyrocket, while other candidates focused on other health care-related topics, such as the racial disparities in maternal mortality and support for people with disabilities.

Kaiser Health News (12/20)

Bloomberg’s health plan includes Medicare-like public option

Image result for Bloomberg's health plan includes Medicare-like public option  images

Former New York Mayor Michael Bloomberg, who is seeking the Democratic Party’s presidential nomination, released a health care plan that includes a Medicare-like public option and added subsidies to help people buy insurance coverage on the Affordable Care Act exchanges. Bloomberg’s plan would also let people who have insurance through their employer get subsidies if they purchase health coverage on the individual market.

The Hill (12/19)

Warren Sidesteps Health Plan Details Before Nevada Union

Image result for Warren Sidesteps Health Plan Details Before Nevada Union images

Source: U.S. News, by Associated Press

Elizabeth Warren told members of Nevada’s powerful casino workers’ union Monday that she wants to see their strong health care plans replicated around the country but the Democratic presidential candidate sidestepped the details of her Medicare for All proposal and how it might affect the union.

Warren spoke at a town hall in front of several hundred members of the Culinary Workers Union Local 226 and its national affiliate, Unite Here, after touring the union’s health center earlier in the day. Warren said under her plan, the health care that the union members experience and count on is “not supposed to change.”

“To me, what you’ve got is not something we want to make harder. What you’ve got is something I want to see replicated all around America,” Warren said to applause. “The part that changes is the money and where the money comes from.”

Beyond saying that the country needs to ask the top earners to “kick in a little more so we can afford health care for everybody,” Warren did not expand upon her proposal or mention Medicare, instead taking questions on immigration, jobs moving overseas and other issues.

The Massachusetts senator is among two leading Democratic candidates, along with Vermont Sen. Bernie Sanders, proposing a single-payer, government-run insurance system. Other candidates in the race, including former Vice President Joe Biden and South Bend Mayor Pete Buttigieg, have argued that a switch to a government-run system would force union members and others into an insurance plan they may not want. Buttigieg has made a point of citing by name the Culinary Union, a powerful political force in Nevada, as an example of a union that would have to give up its care under the plans.

Warren told reporters after the town hall that she thinks Culinary’s plan is “terrific” and a “model for the country,” but “how it is paid for is a different question.” She said she wants to “preserve their access” to their doctors, nurse practitioners and more without having an insurance company find a way to introduce deductibles and copays.

D. Taylor, a former Culinary Union president and current president of Unite Here, introduced Warren and made a point of telling the media from the stage that the country’s health care system has to change. He told the Associated Press later that he thinks health care needs to be expanded in the country, but said, “At the same time, I think if somebody has health care that they really like, I don’t think it’s a very smart idea saying they have to give that up.”

Taylor said he didn’t know if the government could provide the same kind of robust health care that union members already have through their private plans.

The 60,000-member Culinary Union is a mostly female, immigrant-majority group that’s prioritized immigration reform, workers’ issues and health care as its top priorities, including preserving its health plans that have no monthly premiums and no deductibles.

Warren’s event Monday night was part of a series of town halls the union plans to hold this week.

Tuesday morning, Vermont Sen. Bernie Sanders is expected to appear before the union’s members, followed by former Vice President Joe Biden on Wednesday.

California Sen. Kamala Harris, who dropped out of the race last week, was the only other Democratic candidate this year to get a town hall with the union’s rank-and-file.

Geoconda Argüello-Kline, the union’s secretary-treasurer, has said the group has not yet decided if it will wade into the Democratic primary and endorse a candidate. If the union does and moves quickly enough, it could prove decisive in a crowded battle in late February for Nevada’s caucuses.

Doctors Win Again, in Cautionary Tale for Democrats

Image result for Doctors Win Again, in Cautionary Tale for Democrats imagesSource: The New York Times, by Margot Sanger-Katz

Democratic voters eager to see “Medicare for all” or some other major health overhaul pass the next time they control the White House may want to take a close look at what happened this week in Congress.

Leaders from both parties had unveiled legislation to stop surprise medical bills, the often exorbitant bills faced by patients when they go to a hospital that takes their insurance but are treated by a doctor who does not. The White House and major consumer groups had also endorsed the plan, which was to be included in the year-end spending bill.

But to the negotiators’ consternation, the spending package that emerged on Monday — and was passed on Tuesday by the House — had nothing about surprise bills. The proposal’s apparent demise was not a result of partisan division, but instead reflected certain lawmakers’ reluctance to pursue an approach that would reduce doctors’ pay. Several of the key lawmakers who scuttled the deal were Democrats.

In many ways, the debate over surprise bills is a miniature version of the coming fight over major health reform. The kinds of big plans that Democratic presidential candidates are pitching combine consumer protections — lower premiums, lower deductibles, more benefits — with lower pay to medical professionals. The surprise billing legislative package has this mix, too. It would protect patients from receiving surprise bills from doctors, but it would most likely result in pay cuts for certain doctors.

Medicare for all, which Bernie Sanders and Elizabeth Warren have championed on the campaign trail, would offer all Americans generous government-run insurance, while sharply reducing pay to doctors, hospitals and pharmaceutical companies. Plans from other candidates, including Joe Biden and Pete Buttigieg, would set up a “public option,” a government health plan that individuals could buy. That plan would also pay doctors and hospitals less than they earn now.

Both Democratic approaches poll fairly well. But a policy to end surprise medical billing, a smaller endeavor, polls even better, and it has emerged as a top voter concern. In a recent survey from the Kaiser Family Foundation, 78 percent of adults said they wanted the surprise billing problem fixed, and 57 percent said they would still support a solution even if it meant lower pay for health care providers.

Health care providers, of course, do not want their pay to be lowered.

When the legislative process heated up this summer, so did a fierce lobbying effort from doctors and hospitals. Doctor Patient Unity, a dark money group funded by two large private- equity-funded physician staffing companies, spent tens of millions on television advertisements and direct mail, urging lawmakers to oppose the bill. Lobbyists for doctors, hospitals, air ambulance companies and private equity funds also began making the rounds. Doctors have argued for a different solution to the surprise billing problem that would not cut their pay.

Research has shown that a small minority of doctors send surprise bills, and they are clustered in a handful of specialties where patients cannot choose their own doctor, including emergency medicine and anesthesiology. But the ability to send surprise bills affects the negotiating dynamics between that subset of doctors and insurance companies.

The surprise billing legislation in the recent deal would set a default payment to doctors for situations in which they were not in an insurance network, with the ability to appeal larger bills to an independent arbitrator. According to the Congressional Budget Office, the approach would tend to lower pay for doctors in those specialties by an average of 15 percent to 20 percent, because it would shift negotiating leverage in favor of insurers.

Although most lawmakers who have written legislation on the issue endorsed the proposal, a few did not. The bipartisan leaders of the House Ways and Means Committee said last week that they hoped to introduce a competing bill in the future, and released a one-page paper last week describing a framework that is more aligned with the preferences of doctors’ groups.

In a final meeting last week, leaders in the House and the Senate met to decide what legislation would end up in the year-end spending bill. Surprise medical billing didn’t make the cut. Several people close to the negotiations said it did not have strong enough support from the Democratic leadership.

The repeal of taxes that hit the medical device and health insurance industries, on the other hand, were included.

“When you’re going into a world when Democrats actually want to push things that special interests do not want, not getting surprise bills done does not bode well,” said Shawn Gremminger, a lobbyist for the consumer group Families USA, who described surprise medical bills as the “most obvious market failure” in health care. “We couldn’t even get that done.”

Some advocates remain hopeful. The spending deal has several health care provisions set to expire next May. That deadline may provide an opportunity for lawmakers to try again, and some time to build consensus between the authors of the recent deal and more skeptical lawmakers.

Greg Walden of Oregon, a Republican and the ranking member of the House Energy and Commerce Committee, said he was “disappointed” that the bill did not advance. “But I’m not dejected, and I’m not throwing in the towel,” he said. “It was the first locomotive to leave the station, but it will not be the last.”

But that optimism is not universal among the people who worked on the abandoned legislation.

Compared with Medicare for all, surprise billing would seem to have certain political advantages. For one, it targets only certain sectors of the health care industry. Medical specialty groups, private equity firms and hospitals disliked the bill, but insurance companies and large employer groups fought for its passage. They, too, spent millions on ads and lobbying.

The insurance industry would not treat a large expansion of public insurance coverage so kindly. And the pharmaceutical industry, another deep-pocketed health lobby that would fight the health plans from the main Democratic presidential contenders, had nothing to say about surprise bills. Even among doctors, there were many specialties that were unaffected; they also stayed quiet.

The surprise billing legislation had another crucial political ally that the proposed Democratic overhaul efforts won’t: Republicans.

Last Updated 01/15/2020

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