The Senate joined the House of Representatives in passing by wide margins the two final FY 2020 spending bills (HR 1158 and 1865).  The President is expected to sign the bills. Govexec.com discusses the impact of the bills on federal agencies including OPM. Congress is now headed out of town for the holidays.

On the Health and Human Services Department front this week —

• HHS laid out a framework for importing prescription drugs from foreign countries in a proposed rule. 

“The NPRM would allow states and certain other non-federal government entities to submit importation program proposals to the FDA for review and authorization. An importation program could be co-sponsored by a pharmacist, a wholesaler, or another state or non-federal governmental entity. Referred to as Section 804 Importation Programs, these programs would be authorized by the FDA to manage the importation of certain prescription drugs that are approved in Canada and also meet the conditions in an FDA-approved drug application. Eligible prescription drugs would have to be relabeled with the required U.S. labeling prior to importation and undergo testing for authenticity, degradation, and to ensure that the drugs meet established specifications and standards. Notably, these programs would also have to demonstrate significant cost reductions to the American consumer.”

The FEHBlog is dubious of drug importation proposals.

• HHS also proposed to revise the framework for improving the supply of human organs, particularly kidneys, for transplantation.  That is a worthy objective.

Enclara Healthcare’s focus is on chronic disease management and care coordination for patient populations with complex needs. As such, Humana intends to leverage this partnership in order to expand its care coordination and comprehensive care approach, especially in the areas of hospice care and mail order pharmacy procedure. 

Part of Enclara’s strategy when tackling complicated healthcare needs involves real time data and predictive analytics collected and parsed by advanced technologies. Humana intends to employ this strength to improve its “technology stack” for home healthcare pharmacy services. In particular, Humana mentioned that it will be looking to develop and improve its enhanced mobile medication management and EHR data. 

Beckers Hospital Review reports that the Leapfrog patient safety group has named its top 100 hospitals in the U.S., none of which are located in the FEHBlog’s home state of Maryland. What about yours?

Forbes reports that Anthem, the second largest U.S. health insurer, “has started to use blockchain technology to help patients securely access and share their medical data. The company plans to roll out the feature, which is in pilot testing now, to groups of members in the next few months. All 40 million members will have access to it in the next two to three years, according to company officials.” Groovy,

In closing, two tidbits that caught the FEHBlog’s eye — a New York Times article that diaries the nighttime efforts of an emergency room doctor and a Fortune article projecting 25 ideas that are expected to shape the next decade.  

On December 18, 2019, the U.S. Court of Appeals for the Fifth Circuit issued its opinion in the Texas v. Azar case. Healthcare Dive named this Affordable Care Act unconstitutionality case as the “disruptor” of 2019.

The Fifth Circuit agreed with the U.S. District Court for the Northern District of Texas that Congress’s 2017 decision to zero out the ACA’s individual shared responsibility penalty rendered the individual shared responsibility provision (a/k/a individual mandate), 26 U.S.C. § 5000A, unconstitutional. The Fifth Circuit vacated the lower court’s decision that the remainder of the PPACA was inseverable from the unconstitutional individual shared responsibility provision. The Fifth Circuit remanded the case to the lower court for “more searching inquiry” into the severability issue (p. 59).  The Fifth Circuit explained (p. 60).

It may still be that none of the ACA is severable from the individual mandate, even after this inquiry is concluded. It may be that all of the ACA is severable from the individual mandate. It may also be that some of the ACA is severable from the individual mandate, and some is not.46 But it is no small thing for unelected, life-tenured judges to declare duly enacted legislation passed by the elected representatives of the American people unconstitutional. The rule of law demands a careful, precise explanation of whether the provisions of the ACA are affected by the unconstitutionality of the individual mandate as it exists today.

So the case continues.

The ACA marketplace has been running relatively smoothly without the individual mandate. In the FY 2020 spending bill, Congress is amending the law to protect silver loading that helps with the stability. The Trump administration has finalized the individual coverage HRA rules which will add members to the exchange plans. While the Fifth Circuit remanded the severability issue, the FEHBlog can’t imagine that in the end the outcome will be anything other than preservation of the rest of the statute.

The House of Representatives passed today the two final FY 2020 spending bills (HR 1158 and 1865), which include provisions repealing the three ACA taxes that raise health care costs — the medical device tax, the health insurer tax, and the high cost employer plan, or Cadillac, tax. Sen. Lamar Alexander, the chairman of the Senate Health Education Labor and Pensions Committee, announced that the spending bills also include the following four provisions from his Committee’s bipartisan bill to lower healthcare costs, S. 1895.

• CREATES Act—increase generic drug competition and lower the cost of drugs
• Insulin—two provisions to increase biological drug competition and lower drug costs, including in the insulin market
• Tobacco-21—raise purchasing age of tobacco to 21
• Kay Hagan Tick Act—better protect Americans from diseases transmitted by ticks, mosquitoes and fleas

The Senate is expected to approve the two spending bills later this week and the President is expected to sign the bills into law before the current continuing resolution funding the federal government expires on December 20. This action of course would avoid a federal government shutdown.

The Senate today joined the House in approving S. 1790, the FY 2020 national defense authorization act, which the President is expected to sign into law. This is the bill that creates a paid parental leave program for federal employees, requires an independent study of the Administration’s plan to dismantle OPM and creates protections for federal employees in the event of another long government shutdown.

Sen. Alexander in his announcement reiterated his support for legislatively resolving the surprise bill issues in the U.S. Health Affairs reports in this regard that

When physicians whom patients do not choose and cannot avoid can bill out of network for care delivered within in-network hospitals, it exposes patients to financial risk and undercuts the functioning of health care markets. Using data for 2015 from a large commercial insurer, we found that at in-network hospitals, 11.8 percent of anesthesiology care, 12.3 percent of care involving a pathologist, 5.6 percent of claims for radiologists, and 11.3 percent of cases involving an assistant surgeon were billed out of network. The ability to bill out of network allows these specialists to negotiate artificially high in-network rates. Out-of-network billing is more prevalent at hospitals in concentrated hospital and insurance markets and at for-profit hospitals. Our estimates show that if these specialists were not able to bill out of network, it would lower physician payments for privately insured patients by 13.4 percent and reduce health care spending for people with employer-sponsored insurance by 3.4 percent (approximately $40 billion annually).

Federal News Network and Govexec.com report that the omnibus spending bill includes the 2.6% across the board pay raise for federal employees plus a 0.5% locality pay increase as proposed by the House of Representatives. President Trump had proposed just the 2.6% increase. The pay increase would take effect on January 1, 2020.

The Hill reports that this bill also would repeal all three of the most controversial ACA taxes — the medical device tax, the health insurer tax, and the high cost plan / Cadillac tax. This is great news for the FEHBP which has been smacked by the health insurer tax and would be greatly disrupted by the Cadillac tax. The bill also would put pressure on Congress to resolve the surprise billing and drug cost issues by May 22 and it would raise from 18 to 21 the age at which young adults can purchase tobacco products.

Jingle bells. The final text of the bill remains under wraps.  The House is expected to vote on the bill tomorrow followed by the Senate. The current continuing resolution expires on Friday December 20.

Congress leaves town this Friday December 20 (and likely earlier if they can get the omnibus appropriations bill done).

The FEHBlog heard one of those pro-surprise billing arbitration commercials on television yesterday. The commercial condemned government price fixing on surprise billers claiming that it would only benefit the evil, greedy health insurers. Baloney.

Federal and state laws are chock a block full of price controls on health care. Most notably here, the Affordable Care Act imposes a minimum medical loss ratio (MLR) on insurers. That MLR in turn limits health insurers profits. What’s wrong then with restricting out of network provider profits? Goose – gander?? The FEHBlog is no fan of government price controls but at least if government is going to place them on on side of the transaction, it makes sense to put them on other side too.

Health Payer Intelligence reports that

America’s Health Insurance Plans (AHIP) submitted a statement to the House Energy and Commerce Committee opposing current single-payer proposals in the United States.

“Americans are facing an escalating crisis of affordability across our health care system. Cost pressures are becoming more intense for all who pay the tab for health care in the United States, whether they be consumers, employers, or governments,” the organization explained. “AHIP and our members believe that the best way to bring down costs is to improve what’s working and fix what’s not, so that everyone has affordable coverage, access to high-quality care, and control over their health care choices.”

Amen to that.

On the prescription benefit manager front —

• Per Fierce Heathcare, Express Scripts has unveiled the first apps to be added to its curated digital health formulary.  The idea behind the formulary, which other PBMs are adopting, is to “make it easier for health insurers [and self funded employers] to vet the tools for their members, especially as the number of solutions available in the market continues to grow.” The list of ESI approved apps may be found here.   
• Healthcare Dive informs us that CVS Health “unveiled a precision medicine program for oncology patients Thursday designed to increase access to broad-panel gene sequencing tests for patients with specific advanced stage cancers.”

Good news. Govexec.com reports today that the Democrat and Republican leadership in Congress along with the White House have agreed on an omnibus spending bill for the current government fiscal year. Congress has time to pass this legislation before the December 20 deadline provided by the current continuing resolution. Details have not yet been unveiled.

The House of Representatives passed Speaker Pelosi’s prescription drug bill (H.R. 3) along party lines. The Health Affairs blog provides a helpful outline of the various prescription drug bills under Congressional consideration including their status.

The Senate approved the President’s nomination of Stephen Hahn, MD, to be Food and Drug Commissioner today by a 72-18 vote. Fortune offers background on the good doctor.

The House of Representatives passed the current fiscal year defense authorization act today by a wide margin. The Federal News Network reports on provisions beyond the paid parental leave program that affect federal employees, federal annuitants, and federal benefit programs. Specifically the bill addresses FEHBP and FEDVIP problems that arose in the lengthy government shutdown earlier this year. It would be better if Congress banned those shutdowns.

The bipartisan leadership of the powerful House Ways and Means Committee announced a legislative plan to end surprise billing. It is starting to look that we will be stuck with some form of arbitration to resolve surprise billing disputes. The following provision from the new plan plows new ground as far as the FEHBlog can recall:

The party that loses the decision will pay a reconciliation process fee. In addition, a surcharge will be applied to providers and plans that use the process in excess of certain pre-determined thresholds. Annual reporting of the decisions rendered through the process will also be required.

These aspects of the new plan’s dispute resolution process strike the FEHBlog as good ideas.

Kaiser Permanente announced that Gregory Adams has been named as its new CEO following the untimely passing of Bernard Tyson. “Since 2016, he has served as Executive Vice President and Group President, with direct responsibility for health plan and hospital operations in all 8 Kaiser Permanente regions.”

Healthcare Dive reports that

Amazon’s at-home prescription drug delivery company PillPack unveiled its first direct integration with a payer’s app Tuesday. PillPack by Amazon Pharmacy is now directly available on not-for-profit Blue Cross Blue Shield of Massachusetts’ member app, MyBlue, and the Boston-based insurers’ beneficiaries can order, pay for and receive medications to their home for no extra fee. All BCBSM members are eligible for PillPack, but the payer is starting with its fully-insured commercial members and is targeting the product toward those taking multiple medications.

The FEHBlog is a fan of PillPack as it simplifies peoples’s lives and encourages adherence.

Health Payer Intelligence reports on a PriceWaterhouseCoopers study’s findings:

“In 2020, organizations will make strategic deals not to just grow larger but instead to expand into new identities with platforms anchored in value, innovation, customer experience and population health,” the report stated. “As they weigh their options, health companies will need to ensure that the deals they pursue pass the sniff test of employers and consumers seeking more affordable care.”

Thanks to Healthcare Dive, the FEHBlog found the section by section summary of the revised S. 1895 bill reference in yesterday[s post. The Healthcare Dive article notes that “The latest details emerging on legislation to ban surprise medical billing includes nuggets [found in the summary] meant to pacify payers and providers, but is not pleasing either.”

Those nuggets certainly disturb the FEHBlog who knows that the surprise billing / flying the pirate flag issue cannot be solved with any sort of provider / health plan arbitration. That outcome will only increase overall costs and encourage providers to leave health plan networks. Ill advised.  The weeks Econtalk podcast episode concerns the strength of vested interests and you certainly see that weight being thrown around in the surprise billing and prescription drug cost legislative efforts.

In other news, Govexec.com reports that the Congressional conference report on the FY 2020 defense authorization bill, so-call must pass legislation, would block any further dismantlement of OPM at least until the National Academy of Public Administration submits to Congress a study on the OPM-GSA merger (Section 1112).  Title 76 of the conference report would create a 12 week long paid parental leave plan for federal employees effective October 1, 2020. The House is expected to consider the conference report before the Senate.

“Senate Health Committee Chairman Lamar Alexander (R-Tenn.) and House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.) along with Ranking Member Greg Walden (R-Ore.) yesterday announced they have reached a bipartisan, bicameral agreement on legislation to lower what Americans pay out of pocket for their health care.”  This is a revised version of S. 1895, the bill to lower healthcare costs act. The FEHBlog as yet has not been able to lay his hands on the text or section by section summary of the revised bill.

Nevertheless, the American Hospital Association reports that according to the section by section summary, that “Insurers would be required to, at a minimum, reimburse providers for all claims subject to the balance billing prohibition at the median in-network negotiated rate for the service in that geographic area where the service was delivered. Both providers and insurers would have the right to contest claims paid at or above $750 ($25,000 for air ambulance services) using baseball-style, binding arbitration.”

Bloomberg Government reports that the House minority leadership has introduced its own bill to lower drug costs without affecting the number of new drugs, H.R. 19. “The package, unveiled Monday, would create a $3,100 out-of-pocket cap in Medicare’s prescription drug benefit program. It would also take steps to spur new generic drugs and includes a laundry list of changes to Medicare and Medicaid. The legislation includes more than 40 provisions that Democrats and Republicans have previously agreed to support, Republicans say.”

Modern Healthcare has released its 2019 list of most influential people on U.S. healthcare. CMS Administrator Seema Verma captured the top spot.

Healthcare Dive announced its 2019 awards. CVS CEO was named top executive.  Mr. Merlo was number 5 on the Modern Healthcare list. It’s worth noting that Mr. Merlo’s deputy CVS Executive VP Karen Lynch was number 6 on the Modern Healthcare list.

The United Health Foundation issued its 2019 American Health Rankings. Vermont holds the top spot and Mississippi holds the lowest. The FEHBlog’s state Maryland ranks 18th.