Midweek update

David Ermer

I am an attorney who practices law in Washington DC. My practice has involved the Federal Employees Health Benefits Program since 1983.

Midweek update

David Ermer–ACA, Congress, Medicare, SCOTUS–

OPM and AHIP which co-sponsor the annual FEHBP Carrier Conference have posted the Conference agenda. The FEHBlog welcomes the half day of break out sessions has been added to the agenda. The conference which is held in Arlington Virginia will run from early Wednesday afternoon April 1 through late Friday morning April 3.

Earlier today, the House of Representatives, as expected, passed a bill to repeal the 2006 law obligating the Postal Service to pre-fund healthcare coverage for their annuitants. Businesses generally have to account for this type of cost as a liability, but don’t have to put the money aside as the Postal Service must (although the Postal Service has not been able to fund the cost since 2012).

The FEHBlog expects the Senate to adopt this bill which reflects reality. The FEHBlog wonders whether this action will deflate the long running effort to create a lower cost Postal Service program within the FEHBP. The next edition of a general postal reform bill will be telling on this point.

The Centers for Medicare and Medicaid Services today proposed changes to the Medicare Advantage and Part D prescription drug programs. Health Payer Intelligence explains that the proposals

will increase plans’ revenues by 0.93 percent. The proposed rule would extend Medicare Advantage eligibility to those diagnosed with end-stage renal disease (ESRD), lower cost-sharing on prescription drugs, and enforce greater transparency and comparability of out-of-pocket healthcare spending for different drugs. CMS also introduced measures to promote using generics and biosimilar

CMS explains that the agency “will accept comments on all proposals in the Advance Notice through Friday, March 6, 2020, before publishing the final Rate Announcement by April 6, 2020.”

Speaking of Medicare, Healthcare Dive discusses an intriguing Humana initiative to develop primary care centers for their Medicare Advantage members. “The new venture is likely to double the number of centers [Humana subsidiary} Partners in Primary Care operates. It currently runs 47 locations throughout Kansas, Missouri, North Carolina, South Carolina, Texas and Florida.”

The FEHBlog has been tracking the course of the Texas v. U.S. case through the U.S. Supreme Court (Consolidated Nos. 19-840, 19-841). A group of States and the House of Representatives have petitioned the Supreme Court to review a December 2019 Fifth Circuit opinion holding the ACA’s individual mandate unconstitutional and directing the lower court to reconsider the extent to which the remainder of this massive law is severable from the unconstitutional part.

The parties’ and amici (friends of the Court) briefing on the petition for review will be competed on February 12, 2020. The Court’s docket sheet revealed today that the briefs will be distributed to the Court for the February 21, 2020 conference.

The Court needs four votes to take the case for review. If the Court decides to grant review (or certiorari), the decision would be announced late afternoon on February 12. Otherwise, a decision to decline review would be announced the following Monday February 15. The Court may punt the case to later conference in which event the cases will not be referenced in the February 15 order. All of the briefs are available by searching the Court’s docket for one of the case numbers — 19-840 or 19-841.

Medcity News provides a useful list of prescription drugs that are going off patent in 2020. The list also projects the availability of generic competitors.

President nominates permanent OPM Inspector General

David Ermer–Uncategorized–

Yesterday, according to WhiteHouse.gov,

President Donald J. Trump announced his intent to nominate the following individual to a key position in his Administration:

Craig Edward Leen of the District of Columbia to be the Inspector General at the Office of Personnel Management.

Craig E. Leen presently serves as the Director of the Office of Federal Contract Compliance Programs (OFCCP) at the United States Department of Labor, where he oversees audits of Federal contractors and ensures compliance with Federal civil rights requirements.  He also serves on the Special Education Advisory Board for District of Columbia Public Schools, as a professorial lecturer in law at the George Washington University Law School, and previously served on the constituency board for the University of Miami-Nova Southeastern University Center for Autism and Related Disabilities.  Prior to his work at OFCCP, Mr. Leen was the City Attorney of Coral Gables, Florida, where he served as chief ethics officer, oversaw city prosecutions and the city prosecutor, oversaw reviews and investigations as directed by the City Commission, and provided legal opinions and guidance on behalf of the city to public officials and stakeholders to assist in compliance with law.  He is also known for his work helping establish a comprehensive disability inclusion program at the City of Coral Gables.  Mr. Leen received his J.D. from Columbia University School of Law and his B.A from Georgetown University.

This nomination requires Senate confirmation.

Tuesday Tidbits

David Ermer–ACA, CDC, Uncategorized–

The Affordable Care Act (“ACA”) regulators issued a new ACA frequently asked questions (number 41) yesterday. Number 41 discusses the 2019 revised summary of benefits and coverage template and related documents intended for use in the 2021 plan year.

OPM Director Dale Cabaniss sent a letter yesterday to the federal government’s Chief Human Capital Officers about the Wuhan or novel coronavirus.

Although the risk of contracting 2019-nCoV remains very low, agencies should remind employees to use good health habits such as hand washing and encourage sick employees to seek medical treatment and use sick leave or other appropriate workplace flexibilities.  Where necessary, agencies should consider implementing social distancing, including the use of telework. 

That strikes the FEHBlog as good advice for the flu too.

The FEHBlog ran across today this Healio article which takes a deeper dive into last week’s CDC findings that drug overdose deaths dropped by 4% when comparing 2017 and 2018 statistics.

Other data published in Morbidity and Mortality Weekly Report show that opioid prescribing rates dropped in 11 states — California, Delaware, Florida, Idaho, Kentucky, Louisiana, Maine, Ohio, Texas, Virginia and West Virginia — during 2010 to 2016. These states represent about 38% of the U.S. population, according to researchers.

Finally Beckers Hospital Review discusses a disturbing study published in the Annals of Internal Medicine finding that

Visits to primary care physicians fell by 24.2 percent over the study period [2008-2016]. The proportion of adults who did not visit a primary care physician in a given year increased from 38.1 percent in 2008 to 46.4 percent in 2016.

Young adults, people without a chronic disease and individuals living in low-income areas demonstrated the largest drop in primary care visits, although the trend was visible across all age groups and income levels, according to NPR.

The study blames the unfortunate situation on rising out of pocket costs. However, the Affordable Care Act made in-network preventive care visits free. So that’s at best a partial answer. Health plans should strive to encourage strong relationships between members and their primary care physicians. The FEHBlog certainly appreciates his

Monday Musings

David Ermer–ACA, CDC, HIPAA Privacy and Security Rules, Uncategorized–

The Wall Street Journal reports today that

There have been at least 19 million U.S. cases of the flu this season, 180,000 hospitalizations, and 10,000 deaths, according to preliminary estimates from the CDC. There were 61,000 flu-related deaths in 2017-18 and 34,200 deaths in 2018-19. Public health experts say the levels of hospitalization are similar to recent seasons, but deaths are lower than usual and outpatient reports of influenza-like illness remain elevated.

The article adds that

More than half of the positive influenza test results from public health laboratories this flu season have been in children and adults under the age of 25, according to the Centers for Disease Control and Prevention’s most recent weekly influenza report. That’s a higher portion than in the past few years, when less than half the cases were in kids and young adults. 

The reason: The predominant strain circulating early this season was influenza B, which causes more significant illness in children than in adults. 

It makes one wonder why the Wuhan or novel coronavirus was named as a public health emergency but evidently not the flu. The FEHBlog realizes that the public health emergency declaration was intended to free up funding for an unexpected illness but even more government and press focus should be placed on the flu in the FEHBlog’s opinion.

Recently the FEHBlog mentioned a U.S. District Court for the District of Columbia decision holding that the government mandated “patient rates” applicable to individual requests for their own medical records cannot be applied to requests that direct the records to third parties. HHS’s Office for Civil Rights issued an important notice last week advising compliance with the court’s order. The FEHBlog would not be surprised to see an appellate challenge to the decision.

Last week, the Trump Administration made available to State governments a new Medicaid Healthy Adult Opportunity block grant program. The program reminds the FEHBlog of the block grant approach in the Republican’s 2017 bill to repeal and replace the Affordable Care Act. Healthcare Dive reports

Analysts with Cantor Fitzgerald said they maintain a positive view on the manged care sector following the block grant news last week. “It remains to be seen if/when/how many states will opt into the initiative,” the analysts said in a recent note. “We continue to view Medicaid as a compelling growth area.”

The nation’s health insurance lobby didn’t take a position on the measure, but stressed the importance of having flexibility in the program and the need to cover everyone​.

“We support offering state policymakers flexibility to design their Medicaid programs to best meet the needs of their citizens. At the same time, funding mechanisms for Medicaid should not undermine Americans’ access to the care they need and deserve,” America’s Health Insurance Plans said in a statement Friday.

Even if states were interested in implementing the policy, legal experts told Healthcare Dive the demonstration is unlikely to get off the ground — as a fight in the courts is all but certain.

That’s unfortunate, in the FEHBlog’s opinion.

Weekend update

David Ermer–Congress, Uncategorized–

Happy Groundhog Day! USA Today reports that “On Groundhog Day 2020, Punxsutawney Phil could not find his shadow. And as the legend goes, this means we’re in for an early spring.” Oh, there’s also a big pro football game this evening in Miami. Go Chiefs.

Congress is in session this week on Capitol Hill. Federal News Network reports

The House will vote [this coming] week on a bill to repeal the Postal Service’s mandate to pre-fund health benefits for future retirees. The USPS Fairness Act (HR 2382) if passed, would undo one of the central provisions in the 2006 Postal Accountability and Enhancement Act. The bill, introduced by Congressman Peter DeFazio (D-Ore.), now has more than 300 co-sponsors and the support of the postal unions.

If Congress could get together to kill the three highly controversial Affordable Care Act taxes, Congress should be able to repeal this misguided mandate too.

Kaiser Health News reports on the Affordable Care Act penalties on Medicare payments that the Centers for Medicare and Medical has imposed on hospitals for certain adverse events affecting patients.

Now in their sixth year, the punishments, known as HAC penalties, remain awash in criticism from all sides. Hospitals say they are arbitrary and unfair, and some patient advocates believe they are too small to make a difference. Research has shown that while hospital infections are decreasing overall, it is hard to attribute that trend to the penalties.

This HAC penalty is in addition to the readmission penalty on Medicare payments that the ACA also created.

Fierce Healthcare warns

Payers better be prepared for orphan drugs.

The Food and Drug Administration (FDA) will evaluate more than 150 new approvals this year, OptumRx officials said in their latest quarterly report on the drug pipeline.

Already, there are 64 applications submitted to the agency with likely approval in 2020, the pharmacy benefit manager said. At least 11 of those drugs are set to be “blockbuster” products with over $1 billion in U.S. sales, Optum said in the report.

Optum has seen similar development activities over the past several years.

“It’s a little more than just an aberration—seeing three years in a row of high outputs is a trend, and something we think is going to continue at least for the foreseeable future,” Bill Dreitlein, senior director of pipeline and drug surveillance at OptumRx, told FierceHealthcare.

TGIF

David Ermer–ACA, Rx coverage–

Today, the Department of Health and Human Services released the proposed 2021 Affordable Care Act notice of benefit and payment parameters. The Department issued a fact sheet on the 245 page notice. The notice is of principal relevance to qualified health plans in the ACA marketplaces. Two items in the notice are relevant to the FEHBP generally:

  • “The proposed 2021 maximum annual limitation on cost sharing is $8,550 for self-only coverage and $17,100 for other than self-only coverage. This represents an approximately 4.9 percent increase above the 2020 parameters of $8,150 for self-only coverage and $16,300 for other than self-only coverage.”
  • We propose changes to the policy regarding how drug manufacturer coupons accrue towards the annual limitation on cost sharing i n response to stakeholder feedback indicating confusion about the current regulatory requirement. We propose to revise the regulation finalized in the 2020 Payment Notice to provide that issuers would be permitted, but not required, to count toward the annual limitation on cost sharing amounts paid toward reducing out-of-pocket costs using any form of direct support offered by drug manufacturers to enrollees for specific prescription drugs. 

Of interest to insured FEHB plans,

We propose to amend current [medical loss ratio] MLR regulations to require issuers to deduct from incurred claims the prescription drug rebates and other price concessions attributable to the issuer’s enrollees and received and retained by an entity providing pharmacy benefit management services to the issuer. We further propose to clarify more generally that issuers must report expenses for services outsourced to or provided by other entities in the same manner as issuers’ expenses for non-outsourced services. These changes would help lower premiums by helping ensure that consumers’ premiums reflect the full benefit of prescription drug rebates and are not artificially inflated by outsourcing expenses. We also propose to clarify that expenditures related to certain wellness incentives in the individual market qualify as quality improvement activity expenses in the MLR calculation.

The Department is allowing thirty days for public comment. The final notice should be issued well before the 2021 FEHB benefit and rate proposal must be submitted on May 31, 2020.

In other news

  • HHS Secretary Alex Azar announced that the Wuhan coronavirus represents a public health emergency in our country. This declaration, among other things, makes special funding available to state, tribal, and local health departments as the government collectively works to keep the risk of the disease low.
  • Healthcare Dive reports that in their public comments health insurers and employers reacted negatively to the Administration’s cost sharing transparency proposed rule.
  • The Hill reports that the Food and Drug Adminstration has approved the first prescription drug to treat peanut allergies. “Aimmune Therapeutics is behind the drug, called Palforzia, which exposes patients to small amounts of peanuts and helps build up their resistance. “
  • The Wall Street Journal reported earlier this week that

Screening for lung cancer reduces deaths among current and former heavy smokers, according to a new study published Wednesday that adds to the evidence supporting wider testing.

The study, conducted by researchers in the Netherlands and Belgium and published online by the New England Journal of Medicine, found that scanning the lungs of heavy smokers reduced lung-cancer deaths by 24% in men and 33% in women over the course of a decade.

Have a great Super Bowl weekend.

Thursday Miscellany

David Ermer–CDC–

Today the Centers for Disease Control released final U.S. life expectancy data for the U.S.

  • Life expectancy for the U.S. population in 2018 was 78.7 years, an increase of 0.1 year from 2017.
  • The age-adjusted death rate decreased by 1.1% from 731.9 deaths per 100,000 standard population in 2017 to 723.6 in 2018.

These improvements, while slight, are the first improvements in four years. The Wall Street Journal observes that

Lower mortality from cancer, accidents and unintentional injuries were the main reasons life expectancy ticked up in 2018. The {CDC] also said that drug overdose deaths among U.S. residents fell 4% that year, the first such decline in 28 years.

Good news indeed but, of course, room for improvement remains.

The Washington Post discusses a Health Care Cost Institute (“HHCI”) report finding that the Trump Administration’s final rule requiring hospital to disclose their negotiated prices for 300 common services may reduce prices. From the HCCI report,

  • If the highest market prices – for each service – declined such that they were equivalent to the 60th percentile price today, spending would decrease even if the lowest-priced claims within all services were raised to the 59th percentile price;
  • If the lowest 33% of prices – for each service – increased to the 33rd percentile, spending would increase even if the highest 10% of prices – for each service – were lowered to the 90th percentile; ​
  • If within each service, the highest-priced claims were lowered to the 75th percentile market price and the lowest-priced claims increased to the 25th percentile market price, spending would decline by 6.4%, and; ​
  • Spending would increase overall if the lowest half of prices all increased to their service’s median market price and the uppermost quarter of every service’s prices declined to the 75th percentile.

Hope springs eternal. The hospital transparency rule, which, is under legal challenge is set to take effect January 1, 2021. Today was the comment deadline for proposed HHS price transparency rule for health plans.

The Robert Wood Johnson Foundation reviews food label changes that became applicable to most foods on grocery shelves on January 1, 2020. Check it out.

Midweek Update

David Ermer–Rx coverage, SCOTUS–

The FEHBlog wishes to remind his loyal readers that you may subscribe to FEHBlog emails which arrive with the full posts the morning after the post goes live. A subscription box prominently appears on the right margin of the FEHBlog page at ermersuter.com

Has any law generated more litigation in a short period of time than the Affordable Care Act??? Katie Keith in the Health Affairs blog provides a lengthy status report on the major ACA cases pending in the U.S. Supreme Court and the U.S. Court of Appeals.

In other judicial news, the U.S. District Court for the District of Columbia ruled yesterday that the Department of Health and Human Services failed to follow the Administrative Procedure Act in certain respects with respect to its 2013 and 2016 rule makings on access to medical records by patients and third parties such as lawyers and insurers. The details are explained in this Health Security IT article. Due to the importance of this issue to HHS, the FEHBlog expects the agency to take remedial administrative action quickly.

In good prescription drug news:

  • Healthcare Dive reports that pharmaceutical manufactures finally are rolling out biosimilar drugs which action will lower the cost of expensive specialty drugs over time.
  • CVS Health announced today “a new solution eliminating member out-of-pocket costs associated with all diabetes prescription medications, including insulin. Offered through the company’s pharmacy benefit manager (PBM), CVS Caremark, RxZERO enables employers and health plan sponsors to leverage formulary and plan design approaches to offer all categories of diabetes medications at zero dollar out of pocket for their members without raising costs for the plan sponsor or increasing premiums or deductibles for all plan members.”

Tuesday Tidbits

David Ermer–ACA, CDC, Uncategorized–

Johns Hopkins University provides us with a Wuhan coronavirus dashboard that constantly updates the spread of the virus. AJMC.com offers coverage of HHS’s Secretary Alex Azar’s press conference on the topic held earlier today.

“Americans should know that this is a potentially very serious public health threat, but, at this point, Americans should not worry for their own safety,” Azar said. Of the 4500 cases confirmed in China, the country has reported more than 100 deaths. However, “the cases that have been identified skew severe, including patients who are older or have other illnesses. The mortality rate may drop over time as we identify a broader set of cases.”

The CDC recently announced it would begin screening travelers for the virus at 20 airports, up from an initial number of 5. “We are constantly preparing for the possibility that the situation could worsen, and your health and safety has been and will be our top priority,” Azar said.

AHRQ released a chart book on employer sponsored health coverage in our country in 2018.

Between 2017 and 2018, there was no significant change in the overall percentage of private-sector employees (47.8 percent in 2018) enrolled in a health insurance plan offered by their employers (“enrollment rate”). There was also no significant change in the enrollment rate in any firm-size category.

In 2018, average annual health insurance premiums per enrolled employee with private-sector employer coverage were $6,715 for single coverage, $13,425 for employee-plus-one coverage, and $19,565 for family coverage. These amounts represent increases of 5.4 percent for single coverage, 5.0 percent for employee-plus-one coverage, and 4.7 percent for family coverage over 2017 levels

In 2018, enrolled employees paid 21.3 percent of total premiums for single coverage, 27.1 percent for employee-plus-one coverage, and 27.8 percent for family coverage (Exhibit ES.14). The employee share of total premiums in 2018 for single coverage decreased by 0.9 percentage points from its 2017 level, while the employee shares for the other two coverage types were not significantly different from their 2017 levels.

The statutory minimum employee contribution for FEHB coverage is 25% (5 U.S.C. Sec. 8906).

Finally here’s a shocking Justice Department press release concerning an electronic health records vendor Practice Fusion Inc. which agreed to pay the Government $145 million to settle criminal and civil complaints.

The resolution announced today addresses allegations that Practice Fusion extracted unlawful kickbacks from pharmaceutical companies in exchange for implementing clinical decision support (CDS) alerts in its EHR software designed to increase prescriptions for their drug products.  Specifically, in exchange for “sponsorship” payments from pharmaceutical companies, Practice Fusion allowed the companies to influence the development and implementation of the CDS alerts in ways aimed at increasing sales of the companies’ products.  Practice Fusion allegedly permitted pharmaceutical companies to participate in designing the CDS alert, including selecting the guidelines used to develop the alerts, setting the criteria that would determine when a healthcare provider received an alert, and in some cases, even drafting the language used in the alert itself.  The CDS alerts that Practice Fusion agreed to implement did not always reflect accepted medical standards.  In discussions with pharmaceutical companies, Practice Fusion touted the anticipated financial benefit to the pharmaceutical companies from increased sales of pharmaceutical products that would result from the CDS alerts.  Between 2014 and 2019, health care providers using Practice Fusion’s EHR software wrote numerous prescriptions after receiving CDS alerts that pharmaceutical companies participated in designing

Happy Data Privacy Day

David Ermer–Uncategorized–

The Homeland Security Department informs us that “January 28 is Data Privacy Day, an annual effort to empower individuals and organizations to respect privacy, safeguard data, and enable trust.” Health Data Management provides 15 views on the importance of Data Privacy Day. Healthcare Dive adds that

The health IT world is stumping for a unique patient identifier for every U.S. citizen following signs from Congress that it’s open to the idea.

UPIs are distinct numbers, codes or data comparable to a Social Security number that differentiate one person from another. The idea of instituting one linked to patient health records is growing in popularity as a method to concretely match patients with their correct history, culling waste and avoidable medical errors.