October 16, 2017

October 16, 2017


Trump’s Executive Order May Lead To Crackdown on Provider Consolidation

In what the President cited as the first steps to repeal and replace the Affordable Care Act in “a very positive manner,” Trump signed an Executive Order (EO) designed to encourage the rise of a new set of loosely regulated health plans. The EO directs the Departments of Health and Human Services, Labor and Treasury to reinterpret existing regulations to expand health care coverage options to –

  • Allow cross-state association health plans (AHPs),
  • Extend the duration of short-term plans, and
  • Boost healthcare reimbursement arrangements.

The EO indicates a potential crack down on consolidation of doctors, hospitals and other health care providers. The FTC is to report within 180 days on federal and state policies that limit competition and choice in the health care industry. The EO says it will: “re-inject competition into healthcare markets by lowering barriers to entry, limiting excessive consolidation, and preventing abuses of market power.”  Click here to read the EO, here for the White House fact sheet, and here for the President’s signing statement.  For a more detailed analysis, click here for a report in Health Affairs.


Doctor, Patient Groups Slam the Executive Order

  • Six Physician Associations – the American Academy of Family Physicians, American Academy of Pediatrics, American College of Physicians, American Congress of Obstetricians and Gynecologists, American Osteopathic Association and American Psychiatric Association – issued a group statement against the short-term and association health plans that the administration is pushing. Click here for the full statement.
  • A coalition of 18 patient groups, including the March of Dimes and the United Way, state that the new plans will attract healthy patient which will leave sicker patients at risk.  Click here for the statement.

Trump Stops Cost-Sharing Reduction Payments for Exchange Insurers

Citing a a legal opinion from the Attorney General, the President announced that cost-sharing reductions payments will be discontinued immediately. According to the Congressional Budget Office, this could mean that the government will end up spending almost $200 billion more on health insurance. This also garnered swift reaction from the insurance industry, America’s Health Insurance Plans and Blue Cross Blue Shield Association. The National Association of Insurance Commissioners also voiced their disappointment over the decision, click here.  For the official memo announcing the discontinuation, click here. For the CBO report, click here, and the statement from AHIP/BCBSA, click here.

  • For a good perspective on the likely impact, click here for a good report in Health Affairs.
  • California, Massachusetts and New York are among the 15 states planning to file a lawsuit to block the Trump administration from ending federal CSR payments. Click here.
  • Click here for an excellent primer on CSRs.

Providers Defend 340B Drug Program before House Subcommittee

The Energy and Commerce Oversight and Investigations Subcommittee last week questioned health care executives about their use of the 340B drug pricing program. Subcommittee members inquired how they track their savings and how the money is applied to charitable and community programs. Republicans urge more transparency in a drug purchasing discount program, while Democrats pushed back against insinuations that the hospitals are abusing the program.  Compelling testimony from Mission Health CEO, Dr. Ron Paulus, described in detail how his system utilizes 340B savings to serve various disadvantaged communities.  Click here for his statement. To watch the hearing and read prepared testimony from all the witnesses, click here.

  • A new report commissioned by the Alliance for Integrity and Reform Coalition, a pro-pharma group, suggests hospitals are using the 340B drug discount program to boost revenue while cutting their charity care costs. Clickhere for their report.
  • An AHA report concludes that tax-exempt hospitals provided $67.4 billion in benefit to their communities in 2013, versus about $6 billion in foregone federal tax revenue. To read the report, click here.


MIPS Could Penalize Some Docs for their Part B Prescriptions

Doctors who prescribe a high number of Part B drugs could face a dramatic penalty under Medicare’s proposed rules for the MACRA Merit-based Incentive Payment System (MIPS), according to a new analysis. In CMS’ proposed update to MIPS for next year, costs for Part B drugs would be included in its physician quality score. Specialists, such as rheumatologists, oncologists and ophthalmologists who prescribe more Part B drugs than their primary-care counterparts could be penalized by as much as 16 percent under the program. Most participating doctors will see bonuses or penalties randing from 0 to 5 percent. Although the report was funded by pharma companies, Avalere says it maintained editorial independence. Click here to read the report.


High Risk Patients Could Suffer Under MIPS Unless More Flexibility Is Provided

Several national and state doctors’ organizations, lead by the American Medical Association, sent a letter to the Chairman and Ranking Member of the House Energy & Commerce requesting an extension for CMS’ MACRA flexibility powers for an additional three years. Current law states that CMS is allowed flexibility for the first two years of the program and CMS has already utilized these powers buy loosening performance and resource use requirements for the first two years. The letter to the Committee requests Congress to extend that flexibility for another three years. The letter states that the risk of clinicians’ avoiding high-risk patients would be an unintended consequence of poor formula design. Click here for the letter.


Bipartisan CHIP Funding Effort Stalls

Despite efforts to get renewed funding for the Childrens Health Insurance Program passed last week, it could still take a while to get the legislation through Congress.  Funding expired October 1.  Click here for the update.  The State of New York is sounding the alarm over the lack of funding.  Click here for the state’s letter to HHS.

  • The average payment for a child’s visit to an orthopedist when covered by private insurance was $423 in 2014-2015, compared with $162 when covered by Medicaid. Click here for the AHRQ report.

Hospital Trends:

  • Health care spending in the United States is now growing faster for physicians, drugs and home health than for hospitals, according to a new report from the Altarum Center.  Click here for the report.
  • Microhospitals appear to be gaining traction around the country.  Their latest foothold: central Ohio.  Click here.

National Clinical Care Commission to be CreatedThe House last week passed the National Clinical Care Commission Act (S. 920) by voice vote, sending it to the President for signature. The bill establishes a national clinical care commission to evaluate and recommend solutions regarding better coordination and use of federal programs focused on improving care for people with metabolic syndromes and related autoimmune disorders. The legislation would require the commission to review federal efforts and send a final report to Congress by the end of fiscal year 2021. For a summary and bill language, click here.


Medicare Advantage Plans Have Slightly Higher Star Rating in 2018

Approximately 73 percent of Medicare Advantage beneficiaries with prescription drug coverage will be in plans rated four stars or higher, according to data released by CMS last week. The percentage of people in highly ranked plans represents a slight increase over 2017, when 69 percent of enrollees were in four- or five-star plans. Individual company performance varied.  Click here for the CMS fact sheet, and here for the data tables.


NIH Announces Partnership with Drug Companies on New Cancer Therapies

The National Institutes of Health and 11 biopharmaceutical companies are starting a collaboration to find cancer biomarkers for immunotherapies. The partnership, announced last week, will be funded by as much as $215 million, with drug companies contributing $55 million and the National Cancer Institute contributing up to $160 million over five years. The Partnership for Accelerating Cancer Therapies (PACT) will initially focus on efforts to identify, develop and validate robust biomarkers – standardized biological markers of disease and treatment response – to advance new immunotherapy treatments that harness the immune system to attack cancer. For more from NIH, click here.


Lawmakers Raise Concerns Over Late VA Payments to Hospitals

All 13 members of the Virginia Congressional delegation sent a letter (click here) to VA Secretary David Shulkin over concerns about the level of VA’s late payments to hospitals participating in the VA Choice Program. The VA Choice Program was created in 2014 to better enable veterans to seek care in their communities, if they have to wait too long or live too far away from a VA medical facility. The program has come under recent scrutiny with lawmakers questioning the VA funding requests, after the program received $2.1 billion additional funds in August.

  • Secretary Shulkin is directing the VA to overhaul its policies for reporting staff wrongdoing after a new report revealed that the agency routinely concealed mistakes and misdeeds made by its medical providers. Click here for the story.
  • The CAH Coalition supports programs that help provide access to care for communities, including allowing CAHs to provide more services to veterans. You can learn more about the CAH Coalition here.

HRSA Announces Rural Health Services Grant

The Health Resources and Services Administration announced $5 million in Rural Health Care Services Outreach Program Grants were made available last week. The grants are aimed at expanding the delivery of health care services in rural areas and improve population health. Eligible applicants must be located in a rural country, be a rural public or non private entity, be in a consortium with at least two additional organizations, and not previously received an Outreach grant. Up to 25 awards will receive funding. Applications are due December 6, 2017. More on this opportunity can be found here.


Worldwide Obesity Problems Found in Various Regions of the Globe

A study published in the Lancet lat week provides a sobering look at how much the relationship children globally have with food and weight depends on where they are growing up. The study reports that the number of obese children has increased more than tenfold in the past four decades — from 5 million girls in 1975 to 50 million in 2016, and from 6 million boys in 1975 to 74 million in 2016. Click here for details.

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