The FEHBlog really got a kick from this ihealthbeat article and this Healthcare Finance News article about the annual Physicans Sentiment Index compiled by Athenahealth. To sum it up,

Physicians remain concerned over the future of U.S. healthcare, a new survey reveals. Among the survey’s findings, most physicians think EHRs and the ACA will adversely affect the quality of patient care, and nearly two-thirds anticipate that quality of healthcare will worsen over the next five years.

This is an ironic — not a humorous — line because the ACA’s burdens on health insurers dwarf those imposed on doctors. What’s more the government has spent over $5 billion on electronic health records systems and doctors are dissatisfied. That’s really no surprise to me because the doctors didn’t have to invest any capital in the systems. There’s no incentive on the doctors to make the systems work. They evidently would rather complain. It’s not unusual to complain about regulatory burdens like the meaningful use of electronic health records rules but those rules were the government’s consideration for the $5 billion expended on those systems. In contrast all that health insurers get from ACA compliance is the right to stay in business.

Speaking of the ACA, the Wall Street Journal reports that the Supreme Court will have three more decision days in the current term, Monday and Thursday of next week and Monday of the following week. The experts are betting that the ACA decision will come down on the final decision day.  The FEHBlog is already receiving invites to listen to talks about the decision.

Of course, the Supreme Court did not issue its decision on the constitutionality of the Affordable Care Act yesterday. The Court has two more decision days this term, next Monday June 18, and the following Monday June 25. It would be just the FEHBlog’s luck if the Court issued its decision next Monday when he is on vacation.

The FEHBlog noted on Sunday that the American Medical Association was urging calm in the face of the impending decision. Kaiser Health News reports that several large health insurers took the same tack by “promising to continue following some of the rules in the federal health law that are already in effect.” It’s, of course, presumptuous to assume that the Supreme Court will strike down the entire law, but if it does, it will be up to Congress and not just the insurance companies or the doctors to pick up the pieces. For example, the health insurers indicated that they have no problem keeping on covering employees’ children up to age 26. But while the employers and insurers could agree to do so, the tax code in effect before the ACA would have imputed income tax on the premiums paid to cover adult children. What’s more Congress never aligned the FEHB Act’s dependent eligibility provision with the ACA. So, if worse comes to worse for the Obama administration’s position before the Supreme Court, Congress will have to act quickly.

There’s an interesting piece in the Hill’s Healthwatch about the ACA. The ACA requires non-grandfathered group health plans to cover preventive services with grade A or B recommendations from the U.S. Preventives Services Task Force with no employee cost sharing. OPM has applied this requirement to all FEHB plans regardless of grandfathered plan status. The PSTF recently lowered the recommendation of PSA testing below the mandate threshold. Health plans can continue to cover this prostate cancer test without cost sharing but they aren’t required to do so. According to this article, Sen. Kay Hutchinson (R TX) went nuts about this decision.   “Hutchison denounced the group as a ‘panel of bureaucrats’ denying access to a vital test by ‘fiat.'” But the decision affects the cost of the test, not access to the test.

The AMA News advises its readers on three way to challenge insurer policies — joining with organized medicine, getting government assistance, and going to the media. Of course the fourth means — litigation — is offered by my profession. It’s too bad that the AMA News can’t shift the focus to trying to work together with insurers, an approach that does succeed.

Speaking of government assistance, Modern Healthcare reports on a New York State attorney general press release concerning two medical expense balance billing settlement — one with an insurer and the other with a medical group.

Finally, Health Affairs released national health expenditures study today that finds

For 2011–13, US health spending is projected to grow at 4.0 percent, on
average—slightly above the historically low growth
rate of 3.8 percent in 2009. Preliminary data
suggest that growth in consumers’ use of health services remained slow
in 2011,
and this pattern is expected to continue this year
and next.

After 2013, the ACA’s exchanges and multitude of other requirements kick in and the health care spending curve tilts up sharply according to this report.

In 2014, health spending growth is expected to accelerate to
7.4 percent as the major coverage expansions from
the Affordable Care Act begin. For 2011 through 2021, national health
spending
is projected to grow at an average rate of
5.7 percent annually, which would be 0.9 percentage point faster than
the expected
annual increase in the gross domestic product
during this period.

This is the FEHBlog’s 1300th post since 2006.

The Senate is in session tomorrow and out of the rest of the week. The House of Representatives is out all week.  The Financial Services subcommittee of the Senate Appropriations Committee will mark up the FY 2013 financial services and general government appropriations bill that, among other things, funds the FEHBP on Tuesday June 12 at 3: 30 pm (Dirksen 138).

On Friday, The U.S. Office of Personnel Management’s Inspector General released his semi-annual report to Congress (for the period ending March 31, 2012).

The U.S. Supreme Court typically issues its decisions on Monday mornings at 10 am ET when the Court is in session. June is the last month of the Court’s current term. Consequently, legal observers will be holding their breath tomorrow morning to find out whether the Supreme Court has issued a decision on the constitutionality of the Affordable Care Act, a case that was argued at the end of March over three days. After all there are only three more Mondays this month. The FEHBlog finds himself in agreement with the new American Medical Association president who according to the AP has observed that “Americans should not expect chaos if the U.S. Supreme Court rejects all or part of the sweeping health care law.”

The FEHBlog nearly levitated out of his chair yesterday when he read about a study published in Health Affairs criticizing the FEHB Program. The authors are alarmed that

“Average bi-weekly premiums for an individual were lowest ($58.48) in counties where competition between insurance providers was extremely high, compared with areas of low competition ($65.13),”[author Timothy McBride] says.
“This raises concerns about whether the competition will work in the exchanges as intended, everywhere in the country,” McBride says.

The author is freaking out over a $7 price swing??? This study cannot see the forest for the trees. The FEHBP provides many health insurance options to federal employees and annuitants. The competition keeps the Program on the cutting edge of innovation and keeps premiums below the national norm as the FEHBlog has discussed. This is nothing short of a miracle considering the FEHBP’s demographics — half of the enrollees are annuitants and the average age of an enrollee is around 60.

Yesterday, the House of Representatives approved H.R. 436, a bill to repeal two ACA provisions that the FEHBlog has discussed, the medical devices tax and the scripts for OTC drug requirement. Three dozen Democrats joined all of the Republicans in supporting the bill. However, the White House has threatened to veto the law according to Business Insurance and it is unlikely that the Senate will consider the bill this year.

The Leapfrog Group announced on Wednesday that it has begun to award U.S. hospitals letter grades on patient safety which are available at this link. Kaiser Health News has a nice write-up on the program — including a state by state grade breakdown and not surprisingly Medpage reports that

The American Hospital Association (AHA) disputed Leapfrog’s ratings.

“The
American Hospital Association has supported several good quality
measures, but many of the measures Leapfrog uses to grade hospitals are
flawed and they do not accurately portray a picture of the safety
efforts made by hospitals,” Nancy Foster, vice president of quality and
patient safety policy at the AHA, said in a statement.

If the FEHBlog is in need of hospitalization he will check the Leapfrog site.

The FEHBlog is disappointed that he missed the third annual Health Data Initiative Forum which was held earlier this week at the Washington Convention Center.  HHS has a press release about the exciting events of the first day. According to the event’s website there was a walking gallery with an art display featuring

Regina Holliday, a nationally-known DC-based patient rights arts advocate, [who] began painting a series of murals depicting the need for clarity and transparency in medical records. Today, she brings together art, medicine, social media and pop-culture and creates a patient voice in health information technology.

Good luck to Ms. Holliday, a fellow blogger.

The House and the Senate will be in session this coming week. On Wednesday at 11 am the Financial Services Subcommittee of the House Appropriations Committee will mark up its appropriations bill which includes FEHBP funding. The meeting will not be webcast. According to a Hill report, the House also is expected to consider and pass H.R. 436, one of the bills that cleared the Ways and Means Committee last week. This bill would repeal the medical devices tax and the prescription prerequisite  for any OTC drug coverage created by the ACA.

Reuters reports that Express Scripts and Walgreen’s have decided to dismiss their lawsuit between them,but [both parties] said the dismissals did not mean they were any closer to reaching a new deal.” The FEHBlog knows how expensive litigation can be so it’s possible that the dismissial is completely independent of a new contract between the parties, but it has to be considered a step in the right direction.

The Washington Post reports on recent major data breaches at Howard University Hospital in Washington, DC, the University of Utah health care system, and TRICARE. Deven McGraw from the Center for Democracy and Technology  comments that

While the benefits of electronic health records far outweigh the risks, she [Deven McGraw] said, those risks can only be mitigated — not eliminated.
“No matter how good you make the technology,” McGraw said, “we’ll never get the risk down to zero. But we can do a lot better than we have been doing.”

All three cases involved criminal activity against the health care providers which means that at least you have to stay one step ahead of the crooks.

Several years ago, the FEHBlog learned from medical experts that there are not that many preventive services that are worth performing annually on healthy people. The New York Times has a report this morning in which a doctor makes the same point.

As of today, only a few screening tests are recommended as useful for healthy, asymptomatic people by the Preventive Services Task Force and some of those — like blood pressure checks — don’t require a doctor visit and could be performed in a pharmacy. “If you follow their recommendations you hardly do anything to patients,” said Dr. Brett, adding that the most important intervention doctors perform on healthy patients may be counseling about habits. For new patients, he still does the full head-to-toe medical exam — though he does not routinely order blood work — and regards some parts as more or less playacting.

Doctors have become accustomed to performing this ritual in years of training, and “patients come to expect it,” Dr. Cassel said.

“Patients say, ‘hey, why didn’t I get my CXR?’ So many docs say O.K., and order one. You don’t really need all those tests and probably most of the physical exam.”

And of course the ACA generally mandates coverage without cost sharing on the theory that all preventive care bends the cost curve down.

Yesterday, the U.S. Court of Appeals for the First Circuit, sitting in Boston, ruled that the Defense of Marriage Act (“DOMA”) is unconstitutional. DOMA requires that the word spouse be interpreted to mean a person of the opposite sex whenever the word is used in a federal statute or regulation. The FEHB Act defines family member to include the enrollee’s spouse. Pursuant to DOMA, therefore, same sex spouses cannot be enrolled for FEHBP self and family coverage. The courts generally have reacted negatively to this law in recent years as six states and the District of Columbia now will issue marriage licenses to same sex couples. The courts see DOMA as infringing on the state’s rights to regulate family law matters, among other issues.

The issue will now proceed to the Supreme Court for a decision, likely in the first half of 2013. In the meantime, the Court of Appeals has continued in place the stay of the unconstitutionality decision. The FEHBlog expects that the Supreme Court will rule DOMA unconstitutional and then the Program will be opened up to same sex spouses. These court proceedings do not have the potential to moot Sen. Lieberman’s same sex domestic partner legislation (S. 1910) because the vast majority of states do not recognize same sex marriage.

Following up on Wednesday’s post, the House Ways and Means Committee did clear four health care related bills yesterday “on a bipartisan basis.” One bill (H.R. 436) would repeal the Affordable Care Act’s medical device tax, which has been under a lot of fire lately, as its 2013 effective date nears.  The law will require manufacturers of most medical devices to pay 2.3% of their U.S. sales in taxes. Another (H.R. 5842) would repeal the ACA’s provision limiting any health plans, HSA, HRA or FSA coverage to prescribed over the counter drugs, which is a non-sequiter. The other two bills (HR 1004 and HR 5858) concern flexible spending account plans as discussed in this Business Insurance article. 

The Hill reports that the House of Representatives approved its own bi-partisan Food and Drug Administration reauthorization act (HR 5651) by a wide 387-5 margin. The House and Senate will now form a conference committee to reconcile the difference in their similar bills. Both bills “would extend the FDA’s user-fee program for generic drugs and biosimilars.” That’s a development that could bring down the health care cost curve.

Business Insurance reports that the House Ways and Means Committee is expected to clear at a business meeting tomorrow legislation (HR 5842) that would repeal the Affordable Care Act provision that requires a doctors prescription in order for a health plan, a health savings account, or a flexible savings account to reimburse an over the counter drug.  This is a truly goofy law. If Congress does not want over the counter drugs to be reimbursed just say so, but don’t add unnecessary administrative burdens on doctors. This bill would reinstate previous law that permits reimbursement of over the counter drugs when coverage is available.

On a related note Accounting Today reports that the IRS released guidance on the $2500 limitation on health care savings accounts that takes effect next year.

AHIP issued its annual Health Savings Account census report today.

Key findings from the census include:

• The number of people with HSA coverage rose to more than 13.5 in
  January 2012, up from 11.4 million in January 2011, 10.0 million in
  January 2010, 8.0 million in January 2009, and 6.1 million in January
  2008.

• Between January 2011 and January 2012, the fastest growing market
  for HSA plans was for large-group coverage, which rose by 26 percent,
  followed by small-group coverage, which grew by 9 percent.

• In the individual market, 2.5 million people are enrolled in HSA
  plans, while approximately 3 million people were enrolled in HSA
  coverage in the small-group market and nearly 8 million were covered in
  the large-group market.

• States with the highest levels of HSA enrollment were California
  (1,001,943 enrollees), Texas (755,432 enrollees), Illinois (717,384
  enrollees), Ohio (662,999 enrollees) and Florida (539,778 enrollees).

The FEHBlog guesses that you can file this one under No good deed goes unpunished. The Federal Times reports that “An Office of Personnel Management contractor last October
accidentally mailed postcards to about 3,000 federal retirees on which
their Social Security numbers were printed, according to an inspector
general report released Wednesday. Vangent Inc. [NOT an FEHB plan] sent the postcards
to retirees who had suspended their Federal Employees Health Benefits
Program enrollment to inform them of their eligibility to re-enroll
during the upcoming open season.” Here’s a link to the IG report.

The House returns to work this week after tomorrow’s holiday while the Senate takes this week off. According to the Hill’s Floor Watch blog, the House will consider the FDA user fee legislation on Wednesday.

Also following up on Friday’s TGIF post, the FEHBlog teceived a timely Google Alert with an announcement that the Blue Cross Federal Employees Plan now has its own Apple Ipod or Iphone / Android application.

The Office of Personnel Management on Friday posted its 2012 customer service plan on opm.gov.  The plan announces that OPM plans to refresh the OPM.gov website this summer.

The FEHBlog ran across a couple of interesting articles about the Express Scripts – Medco merger and the Express Scripts – Walgreeens rift.  The first is a Reuters article about the unanticipated benefits of the merger for Express Scripts.

One important hoped-for benefit that has materialized, [Express Scripts Chief Medical Officer Steven] Miller said, is that Medco has lower-priced deals from manufacturers on certain medicines that Express Scripts lacked.

“That means we have better purchasing,” Miller said. “We knew we would have more scale for sure. We thought these opportunities were there but you couldn’t confirm it until the deal closed.”

Miller also pointed to Medco’s methods for encouraging increased use of mail order by doctors through electronic prescribing as another surprising benefit.

The benefits, large and small, could help Express Scripts reach its target of $1 billion in cost savings and other synergies from the deal.

The other article is an El Paso Times piece about how Walgreen;s vows to rebound the termination of the Express Scripts contract at the end of last year. However, Walgreens does more business with Medco than it did with Express Scripts.

Walgreens CEO Wasson told analysts the company has a good relationship with Medco and a contract in place “that we intend to honor.” However, Walgreens reported in its second-quarter financial report that the Medco contract can be ended by either side on “relatively short notice.”

Henry, the Express Scripts spokesman, said the company is reviewing Medco’s contracts. After those reviews are done, decisions about the next moves will be made, he said.

Matthew Coffina, an analyst for Morningstar, a Chicago-based investment research company, said in an email that the companies aren’t disclosing when the Medco-Walgreens contract will expire.

It’s hard to believe that the unofficial start of summer, Memorial Day weekend, starts tomorrow. The FEHBlog wishes everyone a pleasant weekend.

The FEHBlog is always interested in insurer initiatives to control health cares costs. That’s what he was attracted this morning to a Washington Post Wonkblog article about creating tiered copayments for medical services. For many years, health plans have offered tiered cost sharing for prescription drugs. Now Blue Cross Blue Shield of Massachusetts is offering a 90% lower co-payment ($50 vs. $500) when a member receives an MRI test at a lower cost provider (e.g., a community hospital rather than a teaching hospital). “Blue Cross is currently at work on a more rigorous evaluation of the insurance product to see whether subscribers are actually choosing the lower-cost product” which was introduced in February 2011.

Yesterday. the Senate passed a bipartisan Food and Drug Administration user fee bill which funds the FDA’s drug approval process. Of interest to the FEHBlog is the fact that the bill creates user fees for both traditional or small molecule generics and generic biologics. Medpage Today reports that

The user fee agreement with manufacturers of generic biologics, or biosimilars, is less defined, because the pathway for approving biosimilars is still being worked out. That section of the bill — known as the Biosimilar User Fee Act — would at first be funded with $20 million annually from the federal government to hire new FDA staff and set assist in setting up a process to review and approve generic versions of biologics.

The House of Representatives may take up this bill next week when it returns after its Memorial Day recess. The Senate’s Memorial Day recess started yesterday.

Healthcare IT News reports that “The White House on Wednesday unveiled what it called a “sweeping shift to mobile,” an initiative aimed at accelerating efforts to make new and useful services available to consumers on their mobile devices.” That tidbit prompted the FEHBlog to search his Iphone apps store for health insurance apps and by golly there are quite a few out there, including Aetna, Coventry, Humana, and the FEHBlog’s insurer Carefirst. In that regard, Market Watch reports that “A new study published in the May issue of Clinical Therapeutics shows that
patients who participate in a text message prescription reminder program have
significantly higher adherence to chronic oral medications than those in a
control group.” Good news.

One week from tomorrow, May 31, FEHB plan carriers must submit their 2013 benefit and rate proposals to OPM.

In its recent benefit and rate proposal call letter, OPM encouraged carriers to engage in efforts to control spending on specialty or biologic drugs. Last month, the Center for Studying Health System Change (CSHSC) issued a report bluntly titled “Limited Options to Manage Specialty Drug Spending.” The report finds that health plan options are limited because there currently are no FDA approved bio-equivalent or bio-generic drugs and physicians, principally oncologists, often dispense the drugs, rather than PBM network or mail order pharmacies. This rubric will be tough to change, particularly while the FDA continues to twiddle its thumbs on bio-generic drugs. The European Union regulators been approving biogenerics for over five years.  Congress gave the FDA the green light to create a regulatory path for bio-equivalent approval over two years ago in the Affordable Care Act.

In Monday’s post, the FEHBlog discussed a Health Care Cost Institute report finding that rising health care prices play a greater role than utilization in driving up the overall cost of health care for privately insured Americans. The CSHSC reached the same conclusion in a Health Affairs study. CSHSC believes that insurers believe that certain providers must be in their network which gives the provider a lot of leverage plus insurers don’t really care because they can pass along the costs to employers. (The FEHBlog does not buy that cynicism.) The CSHSC reports that states are now considering re-entering the world of rate setting which most of them except for the FEHBlog’s home state of Maryland left in the 1990s. The FEHBlog is not a rate setting proponent given the problems that Medicare’s rate setting creates for the entire health care system as illustrated by the monthly S&P reports that the FEHBlog tracks.