March 18, 2019

Providers Targeted with Hundreds of Billions of Cuts in Trump 2020 Budget
President Trump has released his budget for fiscal year 2020 , which was declared “dead on arrival” by Congress and is seen as providing guidance for the appropriations process to come.  However, the budget does provide a clear indication about the Administration’s priorities – some requiring Congressional approval and funding while others may be done through regulation. Overall, the budget cuts Medicare by more than $800 billion, although some of the program cuts are funded by moving the programs to other departments. Notably, most of the cuts directly impact providers, rather than directly impacting beneficiaries. Some of the proposed changes include:

  • Creating a Medicaid Block Grant program;
  • Making site neutral payments between on-campus hospital outpatient departments and physician offices for certain services such as clinic visits;
  • Establishing a 340B Program user fee set at 0.1-percent of 340B drug purchases and requiring all 340B entities to report savings by entities as well as usage of the funds;
  • Making additional cuts to Disproportionate Share Hospital Medicaid payments for fiscal years 2026 through 2029; and
  • Removing the 96-hour rule for Critical Access Hospitals.

HHS Secretary Alex Azar defended the budget in three separate hearings in both the House and Senate. Click here for the detailed HHS budget. This 162-page document provides great insight into current and projected spending and recommendations.  The see Secretary Azar’s committee presentations and questions, click here for the Energy and Commerce hearing, here for the House Appropriations, and here for Senate Finance.

New NCI Trial To Test Breast Cancer Treatment Without Surgery
Can breast cancer be treated without surgery?  The National Cancer Institute is sponsoring a preliminary trial of the no-surgery approach at several sites for patients with breast cancer requiring chemotherapy. The trial will look at whether a needle biopsy, a non-surgical procedure done on the breast area where the tumor was, can determine if a woman has no cancer left after chemotherapy and may avoid surgery. It will involve 175 women in Canada and the U.S. and could lead to “a paradigm change in the treatment of breast cancer,” the NCI said. Click here for the Wall Street Journal story.

State Reinsurance Programs Reducing Individual Premiums: Analysis
A new analysis finds that states with their own reinsurance programs reduce individual market premiums by an average of 19.9% their first year. Reinsurance programs provide a combination of state and federal funds to insurance companies to help offset losses they may incur by covering individuals who are sicker than originally anticipated. Click here for the analysis from Avalere.

  • Meanwhile, as part of a growing trend, companies like GE and Boeing are cutting our insurers completely and contracting directly with providers, click here.

Physicians Generate Increasing Revenues for Hospitals: on Average More Than $2 Million Per Year
Independent and employed physicians generated an average of $2.38 million each for their affiliated hospitals last year, a 52% increase from the $1.56 million in 2016, according to a new survey by Merritt Hawkins. Focusing on inpatient and outpatient revenues from admissions, tests, treatments, and procedures performed or ordered by doctors in 18 specialties, the survey found that full-time cardiovascular surgeons generate an average of nearly $3.7 million a year, followed by invasive cardiologists at $3.5 million, neurosurgeons at $3.4 million, and orthopedic surgeons at $3.3 million. To read more of the survey results, click here.

New Interactive Report Details Health Care Costs Across the Country
Studies show that health care constitutes 18 percent of U.S. economic activity however, the source of the spending varies in different parts of the country – whether it’s high prices, frequent service use, or both. To that end, the Health Care Cost Institute developed the Health Marketplace Index that uses information from commercial insurance to shows health care service prices and use in 112 local areas in 43 states. The Index contains interactive charts and maps to look how health care costs and prices compare across the country. Click here to view the Index.

CMS Updates Its Drug Spending Dashboard
In 2017, total gross spending on prescription drugs was $154.9 billion in Medicare Part D, $30.4 billion in Part B, and $67.6 billion in Medicaid.  CMS updated its Drug Spending Dashboards with data for 2017.  This Administration’s version of the drug dashboards, first released in May of last year, adds information on the manufacturers that are responsible for price increases and includes pricing and spending date for thousands for drugs across Medicare Parts B and D and Medicaid.  Click here for the dashboard and details.

Social Risk Factors Should Be Accounted For In Readmission Penalties
According to a new study by researchers at Henry Ford Health System’s Center for Policy and Health Services Research, a new model that accounts for social risk factors like poverty and living in a disadvantaged neighborhood could greatly benefit safety net hospitals in determining how the federal government penalizes hospitals for readmission rates. By taking these factors into account, at least half of all safety net hospitals, which care for patients regardless of their insurance status or ability to pay, would see a reduction in penalties. Safety net hospitals have long argued that they are unfairly penalized for their readmission rates under the current model since it does not account for social risk factors. For more on the study, click here.

  • Even with higher readmission rates, home health provided significant savings over skilled nursing facilities, according to a new study – click here.

Bipartisan Senators Reintroduce Legislation to Allow Drug Importation of Certain Drugs
Sens. Mike Lee (R-UT) and Amy Klobuchar (D-MN) have reintroduced their legislation that would allow for drug importation from other countries in cases where the price of an older medicine dramatically increases. The Short on Competition Act would specifically allow for expedited reviews and inspections, and temporary importation when there are fewer than five competitors on drugs that have been on the market for at least 10 years and for temporary importation from certain countries when the Secretary of HHS determines there is a drug shortage. Click here to read more from the sponsors of the legislation.

House Committee Chairman Announces Investigation into Short-Term Insurance Market
House Energy and Commerce Committee Chairman Frank Pallone (D-NJ) announced last week that the committee is launching an investigation into the short-term, limited duration insurance market that was expanded by the Trump Administration last year. To begin, the committee sent letters requesting documents and information from twelve companies that either sell or assist consumers in signing up for these types of plans. In the letters, the committee cites concerns over several troubling reports of the plans denying coverage entirely, charging more based on age, gender or health, or refusing to cover consumers for care that may stem from what the company deems a pre-existing condition. To view the letters, click here.

  • Kaiser looks at new health care plans that are significantly cheaper for employers and individuals who purchase their own coverage such as short-term policies and “sharing ministries” and finds that while they have lower premiums, but could leave patients with huge costs in the end, click here.

East and West Insurance Plans to Merge to Create “National Insurer”
Cambia Health Solutions (the parent company of Blue Cross in Portland, Oregon) and Blue Cross and Blue Shield of North Carolina announced last week that they will establish “a strategic affiliation” that will create a combined health insurer with six million health plan enrollees and $16 billion in annual revenues. The two plans state that they will merge key management and operational functions into a larger health insurance company with business on the East and West Coasts. Unlike the recent mergers of investor-owned companies, not-for-profit companies Cambia and Blue Cross of North Carolina say each will retain their current assets, including reserves and capital. For more on the merger from Blue Cross Blue Shield, click here.

Hospitals Starting to Assess Aging Doctors’ Cognitive Abilities
A number of hospitals across the country are beginning to require older physicians, usually those over 70, to undergo screenings of cognitive abilities for recertification. These tests are becoming more prevalent as the baby boomer generation of doctors continue to work well into their 70s, leading administrators to fear their ability to practice may be adversely impacted due to unknown impairment or competency problems. Tests, such as one created by the University of California San Diego called  PACE Aging Physician Assessment, or PAPA, is being employed at various health systems to help to weed out doctors who should no longer be patient-facing. Click here for a story of one such health system, and here for more on the PAPA program.

Meds Just as Good as Surgery for Patients with AFib in Short Term
So says a new NIH study released last week. Patients with atrial fibrillation saw no greater effects from catheter ablation, a common cardiovascular procedure, than drug therapies in preventing strokes, deaths, and other complications. The study did find, however, that  patients who had the procedure experienced longer term improvements and greater symptom relief including fewer recurrences of the condition and fewer hospitalizations, than those who only used medications. Looking at more than 2,200 patients at 126 sites in the United States, Canada, Europe, and Asia, researchers split the group in two (one using medication, one having the procedure) and found that after 12 months of treatment, the quality of life of patients in both groups improved substantially, although 27-percent of those on medication eventually chose to also have a procedure. Click here to read more on the study.

FDA Sends Warning on Surgical Staples and Staplers, Asks Surgeons to Report Issues
After receiving reports of 366 deaths, over 9,000 serious injuries and over 32,000 malfunctions with surgical staples and staplers, the Food and Drug Administration sent a warning letter to doctors stating concerns over the products. The FDA states that some of the most commonly reported problems in these adverse event reports include: opening of the staple line or malformation of staples, misfiring, difficulty in firing, failure of the stapler to fire the staple, and misapplied staples. This has led to such complications as bleeding, sepsis, fistula formation, tearing of internal tissues and organs, increased risk of cancer recurrence, and death. The agency requested physicians to promptly report any adverse events to help the FDA identify and better understand the risks associated with these products. Click here for the FDA warning.

Genetic Testing for Diabetes Risk Now Available
Genetic testing giant 23andMe will now offer consumers a report that will tell them how their DNA impacts their chances of developing type 2 diabetes. Using data from the more than 2.5 million customers already in their database who agreed to participate in research, 23andMe developed a new test that analyzes genetic variants to generate what’s known as a polygenic risk score, the equivalent of a genetic credit score. While the company stresses that genetic risk and overall risk can be quite different for each individual, some experts are still hopeful that the test will send at-risk patients to see a physician who wouldn’t otherwise do so. To read more from 23andMe, click here.

Mental Health Issues on the Rise in Teens, Social Media Could Be Why
A recent study published by the America Psychological Association found that negative psychological symptoms are on the rise in people born after 1995. The greatest peak happened in 2011, which also was the same time social media use increased dramatically. No increase was seen in adults. The study explains that social media usage, which is more steady among teens might cause levels of social isolation and anxiety. To read more, click here.

Eat Mushrooms to Reduce the Risk of Cognitive Decline
A team of researchers at the National University of Singapore conducted a six-year study with over 600 Chinese seniors. Their study found that seniors who consumed over two standard portions of mushrooms a week, had 52% reduced chances of having mild cognitive impairment. Researchers suggest that mushrooms contain multiple antioxidants and anti-inflammatory substances that prevent the buildup of amyloid beta and tau in the brain, which are proteins associated with Alzheimer’s disease. Therefore, mushroom consumption can be a preventative measure, in helping to control cognitive decline in the elderly. To read more, click here.

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