September 16, 2019

Assault on Hospital Prices Intensifies
Make no mistake, spending for hospital services is under increasing assault by the government and private payors and big pharma.  In a series of regulatory proposals from CMS this year, the agency has targeted various hospital funding streams for reductions.  From cuts to hospital outpatient departments to continuing reductions for 340B pharmacy payments, CMS is moving to reform the system by reducing hospital payments.  CMS’ move to value is based, in part, on a net reduction in hospital payments. CMS acknowledges that its ACOs will reduce payments by nearly $3 billion over 10 years.  In a speech last week, CMS Administrator Seema Verma noted that hospital care accounted for a third of all health expenditures and urged a move to more value-based payment system, click here for her remarks.  The nation’s largest health insurer, UnitedHealth Group, issued a brief that growth in hospital prices is the highest out of any other part of the market and will cost $250 billion over the next decade, click here. According to a new study funded by the pharmaceutical industry, hospitals make nine times more than physicians’ offices on provider-administered drugs, click here.  Shifting specialty drug administration away from hospital settings could reduce expenses by $4 billion annually, according to a new report from UnitedHealth Group, click here.

Private Equity Firms Leading Attack on Surprise Billing Legislation
Private equity backed companies that own large physician practices are behind the $28 million in spending against current surprise billing legislation in Congress, according to reports from the New York Times.  TeamHealth and Envision Healthcare are the major backers of Doctor Patient Unity, which is fighting bills that are insurer friendly solutions to surprise billing.  Click here for the report.  Late last week, the House Energy and Commerce Committee leaders announced plans to investigate private equity’s role in increasing the cost of health care.

  • Nealry 80 percent of Americans favor surprise billing legislation.  That’s according to a new Kaiser Family Foundation survey on health care priorities of voters. While it was fourth most important to voters behind lowering prescription drug costs, keeping ACA protections for pre-existing conditions, and  lowering the amount people pay for health care. Click here to view the survey.
  • After some congressional pressure, the Transportation Department announced the formation of the congressionally mandated Air Ambulance and Patient Billing Advisory Committee and the appointment of thirteen members representing a range of health-care interests, click here.
  • Following a report by the Washington Post of aggressive debt collection practices by UVA Health System – including lawsuits and property liens – the system stated that it would increase financial assistance, give bigger discounts to the uninsured and “reduce our reliance on the legal system,” click here.
  • Members of the Florida Congressional Delegation showed their support of eliminating surprise medical billing practices by introducing a number of bills in both the House and Senate, click here.

Rising Health Care Costs Drive Small Business Owners Interest in Medicare-for-All 
According to a new national survey – backed by the Commonwealth Fund – of 500 small employers that while many struggle to address rising health care costs, they are open to a myriad of ideas to mitigate these expenses including “Medicare-for-All.” Over a third stated that health care prices was their top concern, even over attracting new customers or rising state and federal taxes. Additionally, the smallest businesses stated that they feel the strain of healthcare costs the most, among businesses with two to 25 employees, 45-percent said healthcare costs are a major problem. The study also found that in order to cover the rising costs that 48-percent said they raised employees’ deductibles or copays, 25 percent asked workers to pay higher premiums, and 16 percent eliminated dependent coverage altogether. To read the study, click here.

House Speaker Nancy Pelosi’s Drug Pricing Plan Details Released
Details from Speaker Pelosi’s long-awaited drug pricing proposal were leaked, and obtained by the news media.  Under the plan, the government would be allowed to directly negotiate prices with drug companies and tie the cost of drugs to the lower prices paid overseas (a White House proposal). The draft would also impose stiff penalties on companies that refuse to participate in price negotiations and cap seniors’ annual out-of-pocket spending in the Medicare Part D prescription drug benefit. Click here for more from the Washington Examiner.

  • FDA’s Center for Drug Evaluation and Research Director Janet Woodcock told researchers that the industry needs to change and evolve “if we’re going to do what we set out to do: help every patient feel better and live longer,” click here.
  • A new HHS Inspector General report shows that although Medicare Part D spending on brand-name drugs is increasing, rebates have helped slow that growth, despite drug industry claims to the contrary, click here.

Rural Hospitals, Particularly CAHs, Are Exceptionally Vulnerable; Walmart Moves In 
A new report by the Center for American Progress outlines how Medicaid expansion has helped to keep rural hospitals open by increasing profits for the struggling facilities. Rural hospitals in expansion states had a higher median operating margin (-3.4 percent) than those in states that have not expanded Medicaid (-5.7 percent). The report looks at the overall issue of the loss of emergency care when a rural hospital closes, leaving patients with 20 or more miles to travel for emergency services. The report also recognizes the unique distress of Critical Access Hospitals, that are small and long distances from other facilities. Even though they receive cost-based reimbursement, “some CAHs are unable to sustain the costs required to maintain inpatient beds.” To read the full report, click here.

  • Walmart has opened its first-ever standalone facility devoted to health and wellness. Located in Dallas, Georgia, directly adjacent to a remodeled Walmart supercenter, the new “Walmart Health” held its grand opening on Friday, Sept. 13. The 10,000-sq.-ft. facility offers primary care, laboratory tests, X-rays and diagnostics, counseling, dental, optical, hearing, health insurance information and enrollment, and community health education with online education and in-center workshops. A second location, in Calhoun, Georgia, is scheduled to open early next year. Click here.

Physicians Detail Adverse Effects of Prior Authorization
Typically espoused as a cost-savings tool by insurers to prevent over-utilization of healthcare services, physicians spoke out against prior authorization requirements  at a House Small Business Committee Hearing this past week. Concerns over time and the cost to comply with insurer regulations are negatively affecting patient outcomes. Physicians cited the inability to treat patients in the best way because insurance companies won’t approve a treatment. To view the hearing and read the testimony, click here.

  • A study published from the American College of Rheumatology found that 71 percent of patients who were prescribed an infused biologic experienced treatment delays and/or denials from pre-authorizations, click here.

Vaping Takes Center Stage at the White House and on Capitol Hill
The President and First Lady took part in a press conference to discuss guidance that will be come out shortly from the FDA that will ban flavored vaping products and increase overall oversight over the industry. First Lady Melania Trump personally voiced her concerns over the “growing epidemic” in a tweet following the press conference and is said to be a strong forces behind her husband’s declaration to crackdown on teen vaping. The House Energy and Commerce announced a hearing later in the month that will include the CDC and the FDA as well as various state health officials and look into the lung related illnesses and regulations over the industry. On the same day as the President’s announcement, Senate Finance Committee top Democrat introduced legislation that would expand the definition of tobacco products to include e-cigarettes in order to tax the products at the same rate as other tobacco products. Click here for the First Lady’s tweet, here for the HHS announcement, here for the House hearing notice, and here for more on the Finance bill.

  • Juul Labs, one of the largest makers of vaping products, received a warning letter from the FDA to stop marketing its vapes as much safer than other tobacco products without sufficient evidence this is true, click here.
  • The Federal Trade Commission challenged companies that sell oils, capsules, gummies, creams, and vaping pods that contain cannabidiol, or CBD, a chemical compound derived from the cannabis plant, that it is illegal to advertise that a product can prevent, treat, or cure disease without scientific evidence to support the claims, click here.
  • The CDC has decreased the number of patients with lung disease from vaping or e-cigarettes from 450 to 380, click here.
  • According to preliminary results from the CDC’s National Youth Tobacco Survey, 27.5 percent of high school students have used e-cigarettes in the past month, up 6.7-percent from 2018, click here.
FDA Cuts 2020 Opioid Production by 53 Percent 
The Drug Enforcement Agency has proposed to cut opioid production significantly, 53 percent less in 2020 than in 2016. The proposal would reduce the amount of five schedule II opioids manufactured in 2020, while marijuana quota for research increases by almost a third. The opioids taking the largest cuts are fentanyl by 31 percent, hydrocodone by 19 percent, hydromorphone by 25 percent, oxycodone by 9 percent and oxymorphone by 55 percent. For more information from the DEA, click here.
  • Blaming the growing opioid epidemic, the CDC reports that Hepatitis C infections have increased for the seventh year in a row, a 375 percent increase since 2010, citing that 70 percent of new infections are linked to injection drug use. For more on the Hep C 15-year high, click here.
  • The war on opioids forces patients to taper off of pain medication they claim to need, putting doctors in the position of denying them the medication they use to function, click here.

Number of Uninsured Americans Grows for First Time Since ACA Took Full Effect
According to the Census Bureau, the share of Americans without health insurance grew to 8.5-percent, up from 7.9-percent the year before, and the most since the ACA took full effect in 2014. A drop in public insurance rates was the biggest driving force behind the numbers as the percentage of people with public coverage decreased 0.4 percentage points, while the percentage of people with private coverage did not statistically change. The reports also showed that that the U.S. poverty rate fell to 11.8-percent which represents the fourth consecutive annual decline in the national poverty rate. Click here for more from the Census Bureau.

  • Because of Medical Loss Ratio rebates – a requirement under the ACA – health plans are due to give back nearly $1.3 billion in rebates to consumers who were enrolled in 2018, click here.
  • One in six children live with family members who struggled paying medical bills in 2017 due to either uninsurance or health problems in the family, according to the Urban Institute, click here.
  • Pew Charitable Trusts takes a look at the state health insurance exchanges as they once again attempt to create their own marketplaces instead of using the Federal one, click here.
Broken Bones Cost Mediare Billions Every Year: Study
The National Osteoporosis Foundation released findings that Medicare beneficiaries suffered over 2 million fractures, with 40 percent of those being hip and spine fractures. Recurrent fractures occurred in over 300,000 patients, only 9 percent of whom received a bone marrow density test, that created an additional cost to Medicare of over $6 billion. The report also found that by reducing these secondary fractures by 20 percent, it could save upwards of $1.2 billion. The report found that women are the most at-risk group, with an almost 80 percent higher rate of osteoporotic fractures than their male counterparts. For the full report click here.
HHS Awards $374 Million To Programs Supporting Maternal and Child Health
Of the awarded funds, $23 million was granted to three new programs aimed at improving maternal health outcomes, the additional $351 million went to 56 states, territories, and nonprofit organizations through its Maternal, Infant, and Early Childhood Home Visiting Program. For the HHS press release click here.
  • $9 million of the program funding, will create the Rural Maternity and Obstetrics Management Strategy piloting in three states – Missouri, New Mexico, and Texas – to test and develop models that improve access to and continuity of maternal obstetrics care in rural communities, click here.
  • A Food and Drug Administration panel on Friday recommended approval of the first-ever drug to treat life-threatening peanut allergies in children, a condition that confounds and frightens families across the country. Click here.

VA May Have To Reimburse Veterans $1.8 to $6.5 Billion for Care
Following precedent of a similar case in 2015, the U.S. Court of Appeals for Veterans Claims ruled the VA must reimburse veterans for out-of-pocket emergency medical bills not covered by private insurance, other than copayments, coverage that the VA has been denying to hundreds of thousands of veterans. Claims from 2016 through 2025 either filed or pending will be covered under the class action for reimbursement from the VA, an estimated $1.8 to $6.5 billion in reimbursement and restitution. For more from the AP, click here.

HHS Announces $50 Million for 77 New Health Centers
HHS has announced more than $50 million to fund 77 health centers across 23 states, Puerto Rico, and the Commonwealth of the Northern Mariana Islands. The funds are for both new organizations to become HRSA Health Center Program grantees and existing health centers to establish new sites. Nearly 1,400 health centers are located in every U.S. state, the District of Columbia, Puerto Rico, the Virgin Islands, and the Pacific Basin and operate approximately 12,000 sites to provide health care to more than 28 million people. Click here for more information on the latest awardees.

Researchers Find New Cancer Treatment May Also Help Heart Disease
The immunotherapy treatment known as CAR-T, which has proved life-changing for some patients with blood cancers, has been shown to cure certain kinds of heart failure in mice, according to a study published last week in the journal Nature. The researchers show that the technology was used to target scar tissue that stiffens the heart and prevented it from fully relaxing between beats in heart failure patients, and could be a huge breakthrough for patients suffering from heart disease. The expensive treatment – about $450,000 per patient – was only recently approved for payment from Medicare. To read the study, click here.

  • A new study in the Journal of Science Transitional Medicine gives a better idea as to why cancer drug trials are rarely successful, click here.
Obesity Rate Soars Over 35-Percent in Nearly 20-Percent of States, Leading to Increase Policy Proposals
A recently released report by the Trust for America’s Health on obesity rates in America has sparked a flurry of new proposed policy changes. After the report was released, 31 policy recommendations were made, including closing tax loopholes for unhealthy food manufacturers to make it difficult to market to kids, instituting a tax on sugary drinks, and ensuring that nutrition-assistance programs like food stamps make access to nutritious food a priority. For comparison, in 2012, no state had adult obesity rates above 35 percent, and the study revealed that as of 2018 data, nine states (Alabama, Arkansas, Iowa, Kentucky, Louisiana, Mississippi, Missouri, North Dakota and West Virginia) have surpassed that marker. For the study on obesity click here.
  • A panel of scientists will advise the FDA on any potential new advances linking children’s consumption of processed foods containing color additives with behavioral issues on October 7, click here.

Napping May Decrease Risk of Heart Disease
A recent study published in the BMJ Journal has found a connection between nap frequency and the incidence of cardiovascular disease (CVD) events. The prospective study followed 3,462 participants with no previous history of CVD for 5.3 years. The study showed that participants who indicated napping 1-2 times a week had a significantly lower risk of suffering a cardiovascular disease event. However, there was no association between lowered risk for CVD with higher nap frequency or the duration of the naps. For the full study, click here.

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