We are one week away from the Federal Benefits Open Season which begins next Monday November 11.

OPM announced last week that beginning next year the children of same sex domestic partners will be eligible for self and family FEHBP (and FEDVIP) coverage as stepchildren provided that the federal employee and domestic partner register their relationship with the employee’s agency and they don’t live in a state that permits same sex marriage. In states that recognize same sex marriage OPM expects the same sex couple to marry in order to cover the partner’s children (just like an opposite sex couple).

The Senate, but not the House, is in session this coming week according to the Hill’s Floor Action blog.

Following up on Friday’s note about HHS’s decision not to apply the federal program’s anti-kickback act to qualified health plans in the ACA exchanges, the Wall Street Journal reports tonight that prescription drug manufacturers are enthused by the fact that the decision allows them to offer subsidies, e.g., co-pay cards, to cover QHP co-payments on their brand name prescription drugs. The article notes that

[D]rug makers have been concerned that high copayments and deductibles on plans sold on the exchanges could deter newly insured people from filling their prescriptions, said Dan Mendelson, president of consulting firm Avalere Health LLC. He said the average “silver” health plan offered through the exchanges has a $2,500 deductible, while the average “bronze” plan’s deductible is $5,000.

FEHB plans expressly are not subject to this complicated anti-kickback law. The PBM trade association plans to fight the HHS decision because the co-pay cards interfere with their formulary arrangements.

Yesterday House and Senate leaders made available a discussion draft of a bill to replace the Medicare Part B sustainable rate of growth formula with a reformed “fee-for-service (FFS) payment system [that places] greater focus on value over volume, and encourage[s] participation in alternative payment models (APM), such as accountable care organizations and patient-centered medical homes [consistent with the ACA]. According to the Washington Post, the American Medical Association supports the bipartisan proposal.

AHIP announced that a bipartisan bill to delay the onerous health insurer fee has been introduced in Congress.  The FEHBlog has higher hopes for passage of the SGR replacement bill.

Earlier this week, CMS announced that the Medicare Part B premiums and deductible will not change for 2014. “The Medicare Part A deductible that beneficiaries pay when admitted to the hospital will be $1,216 in 2014, an increase of $32 from this year’s $1,184 deductible.”  The Part A deductible covers the first sixty days of inpatient confinement per spell of illness.  “Beneficiaries must pay $304 per day for days 61 through 90 in 2014, and $608 per day for hospital stays beyond the 90th day.  For 2013, per day payment for days 61 through 90 was $296, and $592 for beyond 90 days.  For beneficiaries in skilled nursing facilities, the daily co-insurance for days 21 through 100 in a benefit period will be $152.00 in 2014, compared to $148.00 in 2013.”

The IRS announced yesterday that the $2500 cap on contributions to health care flexible spending accounts will not increase for 2014.  The IRS did create a new option yesterday that allows health care FSA plan sponsors to allow participants to roll over up to $500 in unused funds at year end (in lieu of the permitted grace period).  The roll over would not count against the $2500 cap for the next year. IRS Notice 2013-71 

A friend forwarded me a link to a Tenesseean article about hospitals thinking about footing the bill for patients’ subsidized ACA exchange coverage similar to the way in which they help impoverished patients sign up for Medicaid.

Into this environment of uncertainty and change, hospitals and clinics are asking the question: “If my patients do not buy the new Obamacare health insurance, can we get it for them?” A recent Credit Suisse report has analyzed the ACA exchange rates and concluded that up to 6.5 million Americans could literally get free health insurance if they select the Bronze Plan. If it is free, can hospitals sign them up? If it is not free, can hospitals pay the premium for them? 

According to this report from the Association of Corporate Counsel, HHS Secretary Kathleen Sebelius has informed Congress that qualified health plans on the exchanges are not federal health programs subject to the federal programs anti-kickback act.  Subjecting QHPs to the AKA would have complicated the hospitals’ plan. The fly in the ointment is that a patient cannot just enroll for subsidized coverage when he or she is admitted unless the admission occurs during an Open Season and even then the coverage at best begins on the first day of the following month.

Happy Halloween! The Senate confirmed Katherine Archuleta to be the new OPM Director yesterday. The Washington Post reports 

Archuleta, 64, a Colorado native, was the national political director for Obama’s reelection campaign and will rank among his administration’s prominent Latinas. She served as chief of staff to former Labor secretary Hilda Solis and had positions at the Energy and Transportation departments. She has long been a force in Colorado’s Hispanic community.
Archuleta replaces John Berry, whose term expired in April and who is now U.S. ambassador to Australia. Elaine Kaplan will leave the agency as acting director to become a judge at the Court of Federal Claims.

Govexec.com has a report on Rep. Issa’s proposal to open the FEHBP to all Americans, and the article quotes the FEHBlog.

Govexec.com also reports that federal annuitants will receive a 1.5% cost of living adjustment for 2014.

The 2014 cost-of-living adjustment is a relatively small one, and marks the second consecutive year the figure has dropped. The 2013 COLA was 1.7 percent, while the 3.6 percent boost in 2012 was the first COLA increase since 2009.

The Joint Commission, a credentialing body, released its annual list of top performing hospitals according to Medscape.

The number of institutions that made the cut by scoring high on quality measures for pneumonia, heart failure, and other conditions rose from 620 in 2012 to 1099 in 2013 — a 77% increase. The scores are based on hospital performance in the preceding year.
The latest crop of top performers represents one-third of all hospitals accredited by the Joint Commission that reported quality data for 2012. The vast majority of the elite 1099 lack a national reputation. Only 7% of them — or almost 80 — are major teaching hospitals. But that figure represents an increase over 2012, when major teaching hospitals constituted 5% of the 620 top performers.

Recently the FEHBlog noted that the Leapfrog Group had released its Fall 2013 hospital safety survey results. FierceHealthcare.com reports that several hospitals are questioning the validity of the survey results.

The Washington Post reports that Senate Majority Leader Harry Reid (D Nev) will be bringing several pending nominations to the floor later this week, including Katherine Archuleta’s nomination as OPM Director. Bloomberg reports that Senator Lindsay Graham (R SC) plans an effort to block these nominations until lawmakers hear from survivors of the September 11, 2012, attack on the U.S consulate in Benghazi, Libya.

Ms. Archuleta’s nomination cleared the Senate Homeland and Governmental Affairs Committee in late July 2013. Sen. Tom Coburn (R Okla) put a hold on floor consideration of her nomination because of the Congressional coverage kerfuffle. He removed that hold in early August after OPM issued its proposed rule. Under OPM’s rule (now finalized) members of Congress and their official staffs will receive coverage via the DC SHOP exchange next year. Politico reports that OPM has allowed members of Congress until this Thursday to designate their official staffs who will be booted out of the FEHBP (until retirement).  Senate Minority Leader Mitch McConnell (R Ky) and Minority Whip John Cornyn (R Tex), among others, have designated all of their staff members as official staff.

Federal News Radio offered a couple of additional viewpoints on House Oversight and Government Reform Chairman Darrell Issa’s bill to extend the FEHBP to non-federal employees.

In recent carriers letters OPM has encouraged FEHBP carriers to adopt the Blue Button program and the Choosing Wisely campaign.

• The Blue Button program is a Veterans Affairs initiative to create a downloadable personal health records from electronic medical and/or claim records. Government Health IT reports that “The American Health Information Management Association (AHIMA) announced
  on Monday that it will embark on a campaign to encourage its Component
  State Associations and members to actively support the Blue Button
  Initiative to promote access to personal health records (PHRs).” Here’s a link to the Blue Button pledge page. Here’s the healthit.gov page on the Blue Button movement. If you are an FEHBP enrollee, check your plan’s website for the Blue Button.
• Choosing Wisely is a campaign “focused on encouraging physicians, patients and other health care stakeholders to think and talk about medical tests and procedures that may be unnecessary, and in some instances can cause harm.”  The campaign arranges for medical societies to create and update lists of Things Physicians and Patients Should Question.” Here is the list of dates when medical socities will be releasing their recommendations. Most recently, the American Academy of Dermatology, the American College of Chest Physicians and American Thoracic Society (Pulmonary), and the American College of Rheumatology (Pediatric Rheumatology) released their recommendations which are available on the campaign’s website.

The FEHBlog was out of town over the weekend. He returned home late last night in time either to bang out the weekend update or watch the end of the World Series game. As it’s Monday, you can guess which choice he made (and what an exciting end to the game).

The Hill’s Floor Action blog reports that Congress is in session this week.

Also looking down the pike, reginfo.gov tells us that HHS recently submitted to the Office of Management and Budget for review a rule implementing a law affecting the FEHBP and other group health plan that was enacted almost five years ago.

AGENCY: HHS-CMS RIN: 0938-AR81
TITLE: HIPAA Mental Health Parity and Addiction Equity Act of 2008 Amendments (CMS-4140-F)
STAGE: Final Rule ECONOMICALLY SIGNIFICANT: Yes
RECEIVED DATE: 10/18/2013 LEGAL DEADLINE: None

In fairness to HHS, health plans have been operating under an interim final rule since 2010 when the law took effect.  OMB review is the last step before publication in the Federal Register.

Govexec.com offers a column with five reasons to consider changing your FEHB plan in the upcoming Open Season. The article notes that “A statistic that comes up during every health benefits open season is the fact that only about 5 percent of federal employees (and an even lower percentage of retirees) change their plan in the Federal Employees Health Benefits Program each year.” Of course 5% of the total of FEHBP enrollment of roughly 4,000,000 federal and postal employees is around 200,000 changes which is lot of people.

House Oversight & Government Reform Committee Chairman Darrell Issa (R CA) joined by a Democrat Congressman, Willam L. Clay (D Mo.) has introduced a bill (HR 3319) that would allow all Americans to enroll in FEHB plans with eligibility for Affordable Care Act premium subsidies and cost sharing. The FEHBlog does not expect this bill to become law but it’s an interesting concept which has been previously tossed into the ring by now Secretary of State Kerry when he ran for president in 2004 and Senate Homeland Security and Governmental Affairs Committee chairman Tom Carper (D Del) (according to the Federal Times report).

Today, HHS issued another massive ACA rulemaking concerning 2014 benefit parameters. This rulemaking concerns, among other topics, transitional reinsurance fee. This fee will collect $25 billion from insured and self-funded health plans over the period 2014 – 2016. A Democrat proposal in the last round of continuing resolution talks was to delay this fee which is a whopping $63 per belly button for 2014. The latest rule-making includes this fascinating statement — “We also intend to propose in future rulemaking to exempt certain self-insured, self-administered plans from the requirement to make reinsurance contributions for the 2015 and 2016 benefit years.” (p. 24). The fee will drop in those years but it will still be substantial. It is unusual for employers to both self insure and self administer their health plans, however. There are employee organization sponsored FEHB plans that are self insured and self administered. The FEHBlog will keep an eye out for this proposed rule.

The Leapfrog Group came out with its Fall 2013 hospital safety scores yesterday.

 Key Findings:
    Of the 2,539 general hospitals issued a Hospital Safety Score, 813 earned an “A,” 661 earned a “B,” 893 earned a “C,” 150 earned a “D” and 22 earned an “F.”
    On average, there was no improvement in hospitals’ reported performance on the measures included in the score, with the exception of hospital adoption of computerized physician order entry (CPOE). The expansion in adoption of this lifesaving technology suggests that federal policy efforts to improve hospital technology have shown some success.
    While overall hospitals report little improvement in safety, some individual hospitals (3.5 percent) showed dramatic improvements of two or more grade levels.
    The states with the smallest percentage of “A” hospitals include New Hampshire, Arkansas, Nebraska and New Mexico. No hospitals in New Mexico or the District of Columbia received an “A” grade.{FEHBlog note Several well known hospitals like Georgetown, George Washington, Washington Hospital Center, and Children’s Hospital are based here in DC.]
    Maine claimed the number-one spot for the state with the highest percentage of “A” hospitals.
    Kaiser and Sentara [FEHBlog note — a northern and southeastern Virginia chain] were among the hospital systems that achieved straight “A” grades, meaning 100 percent of their hospitals received an “A.”

 The FEHBLog was chagrined to discover that Standard and Poors no longer posts its monthly healthcare cost indices. Instead Standard and Poors now offers  healthcare claims indices on pharmacy, medical and composite bases — both nationally and regionally. The latest monthly changes are of course all up.

The Senate is in recess this week while the House is in session according to the Hill’s Floor Action blog. The FEHBlog can’t understand why Katherine Archuleta’s nomination as OPM Director remains stalled before the Senate. Meanwhile, Elaine Kaplan, whom the Senate has confirmed to be a U.S. Claims Court judges, remains at her post as acting OPM Director. (There currently is no OPM Deputy Director).

The FEHBlog enjoys reading the weekend issue of the Wall Street Journal. He noticed this feature article on the brain. Here’s how it begins:

Who hasn’t heard that people are either left-brained or right-brained—either analytical and logical or artistic and intuitive, based on the relative “strengths” of the brain’s two hemispheres? How often do we hear someone remark about thinking with one side or the other?
A flourishing industry of books, videos and self-help programs has been built on this dichotomy. You can purportedly “diagnose” your brain, “motivate” one or both sides, indulge in “essence therapy” to “restore balance” and much more. Everyone from babies to elders supposedly can benefit. The left brain/right brain difference seems to be a natural law.
Except that it isn’t. The popular left/right story has no solid basis in science. The brain doesn’t work one part at a time, but rather as a single interactive system, with all parts contributing in concert, as neuroscientists have long known. The left brain/right brain story may be the mother of all urban legends: It sounds good and seems to make sense—but just isn’t true.

Thought provoking, no?

The Federal Times reports that the continuing resolution that Congress passed on Wednesdays supports the President’s budget proposal for a 1% across the board raise for federal employees.

Aon Hewitt, the actuarial and benefits consulting firm, released its 2013 survey of health plan costs and found low increases this year with a big jump for 2014 (6 to 7%) — significantly above the average FEHBP increase (3.7%) that OPM announced last month. The Aon Hewitt release also discusses how employers are addressing health plan issues.

Medscape discusses the importance of doctors considering and discussing with patients the cost of outpatient tests before ordering them. The article notes that by just checking a few boxes along with a pap smear the total cost of the test package can skyrocket from under $50 to $1000. Doctors are the front line on controlling healthcare costs.

A Med Xpress article discusses a study on emergency room use which quotes the study’s author, a University of Michigan ER doctor as follows:

“Accessing the ER is a cultural learned behavior partly because the public knows that the ER is always open if they have difficulty accessing care,” [Adrianne Haggins, M.D.] says. “We have to offer them alternatives once they are there, and better understand what factors drive them there. We need to coordinate with other ambulatory settings to help patients find providers and be aware of alternative settings to change patterns of healthcare seeking.”

And, if the goal of reducing emergency visits is a priority, she says, then emergency providers and outpatient providers must work together to coordinate a patient’s care after an emergency visit, including access to specialists when needed.

The health plans can’t do it alone.

The Senate agreement includes no major alterations to the 2010 health-care law. But the deal will include one
minor change sought by Republicans, setting new procedures to verify the
incomes of some people receiving government subsidies for health-insurance
costs. Negotiators rejected a Democratic proposal to delay for one year a fee
of $63 per insured person levied on groups that offer health policies,
including employers, labor unions and insurance carriers—a fee opposed by many
large employers and unions. The agreement does includes backpay for all federal
workers who were furloughed during the government shutdown.

The Journal of Accountancy has more details on the ACA provision in the CR (as it’s a tax law provision).

Keeping going with the good news, the Wall Street Journal reports today that

New results from the Cancer Genome Atlas research project identify a host of genetic mutations that are common among 12 different types of cancer, reflecting the growing understanding that tumors can be defined by their underlying biology rather than their location in the body.

The article explains that

One of the mutations identified in the study, in a gene called BRAF, highlights both the promise and the challenge of finding what role the same mutation may play in different types of tumors.
The BRAF mutation already is implicated in more than half of cases of melanoma; in the new study, it was found in 7% of certain lung cancer tumors, 4% of colon cancer malignancies and in smaller fractions of brain, bladder, head-and-neck, kidney and ovarian cancers.  Roche Holding AG’s drug Zelboraf is approved for melanoma patients with a BRAF mutation, and in small studies it has shown promise among lung-cancer patients with the same mutation. But researchers say other studies indicated the drug used alone has little effect on BRAF-driven colon-cancer tumors.

Last spring, the U.S. Supreme Court invalidated a patent on a test for the BRAC genetic mutation.  Also last Spring, HHS determined that health plans must provide in-network coverage for the test without member cost sharing according to he ACA. Plans, however, may apply medical management techniques to ensure medical necessity for the testing. Bloomberg reported on Tuesday that

Quest Diagnostics Inc. (DGX), the biggest U.S. operator of medical labs, will sell a test for two breast cancer genes starting today [October 15], providing competition for Myriad Genetics Inc. (MYGN) and potentially helping to reduce costs for women fearful they are at risk of the disease.  Quest will sell the most comprehensive version of its test for the BRCA1 and BRCA2 genes for $2,500, said Richard Bender, a consultant for the Madison, New Jersey-based company. The price compares with almost $3,400 that Medicare pays for the most comprehensive version of a test from Myriad. About 85 percent of the Salt Lake City-based company’s $613.2 million in revenue came from BRCA testing in the fiscal year ended June 30. * * * Mutations in the BRCA1 and BRCA2 genes, the most common cause of hereditary breast and ovarian cancer, are present in roughly 1 in 400 women and give women an elevated risk of ovarian cancer as well as a higher breast cancer risk.

The article adds that Myriad is continuing its litigation to challenge competitor’s alleged use of Myriad patents that were not affected by the Supreme Court decision (a complicated legal issue). Quest brought a preemptive declaratory judgment action against Myriad in federal court to challenge this strategy.