Following up on Sunday’s post, the House Oversight and Government Reform Committee held a business meeting today, and the FEHBP PBM transparency and price setting bill (HR 4489) was not considered. 

Also, as mentioned on Sunday, the Senate Homeland Security and Governmental Affairs subcommittee on federal workforce management held a hearing about federal work-life programs on Tuesday May 4.   Mr. Jonathan Foley, who testified on OPM’s behalf, provided an in-depth description of OPM’s federal workforce wellness initiatives.

Today, the House Energy and Commerce Health Subcommittee held a hearing on trio of health care transparency bills.  I found Harvard Professor Regina Herzlinger’s testimony to be thought provoking. Modern Healthcare reports that Subcommittee Chair Frank Pallone (D NJ) “said he would not commit to advancing legislation that requires providers, payers and vendors to publicly disclose the cost of their services.”

PPACA or the Affordable Care Act, of course, is the health care reform law that Congress passed in March 2010. Today, I discovered a consolidated version of PPACA that puts all of the pieces — the original Senate bill, the Senate amendments, and the reconciliation bill (HCERA) together for ease of reference.

Congressman Chris Van Hollen (D Maryland) introduced a bill today that would amend the FEHB Act so that it conforms with the dependent child eligibility provision in PPACA (Sec. 1001 creating Public Health Service Act Section 2714 — try out the consolidated PPACA).  In other words, the bill would increase the FEHB Act’s dependent children age ceiling from 22 to 26 and it would remove the current FEHB Act provision that terminates coverage if a dependent child marries. The effective date for the change is January 1, 2011, but the bill would allow the OPM Director to accelerate the changes into this year presumably by regulation.

HHS issued today an interim final rule creating PPACA’s Early Retiree Insurance Program effective June 1, 2010. Business Insurance explains that “Under a $5 billion program—authorized by the new health care reform law—employers with health care plans covering retirees from age 55 through 64 will be reimbursed for 80% of such retirees’ claims between $15,000 and $90,000. The HHS rule, however, excludes expressly FEHB plans from participation in the Program, notwithstanding the fact that FEHB plans are employer sponsored, cover millions of early retirees, and are underwritten by private sector carriers, not the federal government.

Businessweek reported yesterday that

The U.S. Chamber of Commerce and 12 other business groups asked members of President Obama’s cabinet * * * for more leeway in implementing the health-care overhaul.

The groups said they’re being forced to make contract, employee-benefit and other decisions without guidance on how to comply with provisions that take effect in September. The letter dated April 30 was sent to {Treasury Secretary Timothy} Geithner, Health and Human Services Secretary Kathleen Sebelius and Labor Secretary Hilda Solis.

The groups, which include the Blue Cross and Blue Shield Association, the National Retail Federation and the American Benefits Council, requested at least six months to comply with the regulations once they are implemented, and a “good-faith” standard for measuring compliance.

I also discovered today that Senator Tom Coburn (R OK) has created a web page with links to all of the Congressional Research Service reports on PPACA’s impact.

In Sunday’s post, I noted that the House Oversight and Government Reform Committee will be holding a business meeting on May 6 at noon to mark up HR 626. I somehow mis-clicked on their calendar because it hit me today that the House passed HR 626 last summer. So I wound up informing you about a meeting that was held last year. The Committee’s May 2010 business meeting will be held on May 6 at 10 am. The agenda has not yet been posted.

On May 4, 2010, at 2:30 pm, the Senate federal workforce subcommittee will hold a hearing on work life programs for federal employees. On May 6, at 12 noon, the House Oversight and Government Reform Committee will hold a business meeting. The Committee will be marking up the the Federal Employees Paid Parental Leave Act (H.R. 626), but not the FEHBP prescription drug transparency and pricing bill (HR 4489) which cleared the subcommittee on March 24, 2010.

I subscribe to the AMA News. I ran across a couple of interesting articles in recent issues. The first discusses how patient safety and quality experts are hoping that PPACA delivers substantial improvements in healthcare.  You’ll find a helpful list of PPACA’s patient safety and quality measures. The second discusses a California Healthcare Foundation study titled Consumers and Health Information Technology: A National Survey.  The survey finds that “Although only 7% of adults currently use a [personal health record] PHR, the number is growing.” The AMA News notes “That survey also found that if patients are going to be pushed toward greater PHR adoption by anyone, it’s going to be by the health care system representatives they trust the most — their physicians.”

Following up on the mid-week update, I ran across this AP article on personalized medicine, which emphasizes that while progress is being made, this is a long term solution 

Finally, take a look at this AIS Health Plan Daily article  which discusses the adverse legal consequences that can befall health plans that fail to communicate adequately with providers and members in high risk situations — here a liver transplant.

Following up on Monday’s post, here is a link to the OPM website referenced in the Federal Times article which discusses the legal difficulties in accelerating the increase in the dependent child age limit from 22 to 26. It’s worth noting that effective January 1, 2011, the health care reform act (PPACA) not only increases the limiting age but overrides the FEHB Act’s provision that terminates coverage for a child under age 22 who marries.

Yesterday, the Internal Revenue Service issued Notice 2010-38 which discusses the PPACA provision that modifies the federal tax code (Internal Revenue Code Sections 105, 106) to ensure that the expanded dependent coverage will not create adverse income tax consequences for employees / parents.  Under current law, if employer coverage is extended to, for example, a domestic partner of an employee, the employer must impute the value of that coverage to the employee’s taxable income. Absent this tax law change, employers also would have found it necessary to impute the value of the adult dependent children coverage to the employee. The IRS confirms that “As a result of changes made by the recently enacted Affordable Care Act [or PPACA], health coverage provided for an employee’s children under 27 years of age is now generally tax-free to the employee, effective March 30, 2010.”  The IRS has a website dedicated to health care reform changes. We now await Health and Human Services guidance on PPACA’s dependent child coverage provision (Sec. 2714).

Enough PPACA for now, as you may know, I am enthralled with the long term prospects for personalized medicine. I therefore found interesting this San Francisco Chronicle article about an experiment which examined the genomes to twins — one who had contracted multiple sclerosis and the other who had not.
The study led by a UCSF neurologist took nine months to complete using some of the most advanced analysis equipment in the world, at a laboratory in Santa Fe, N.M. The results are published in Thursday’s issue of Nature.

Researcher Sergio Baranzini and his team couldn’t find a genetic trigger in the twin with multiple sclerosis, but that doesn’t mean it isn’t there, he said. Geneticists may just need to dig deeper, with even more advanced technology, or they may need to narrow their search.

Or, it’s possible that at least with this one pair of twins, genes weren’t what separated them – environmental factors may have caused one sibling to develop MS, Baranzini said.

“We did not find any genetic evidence that could explain why one individual developed a disease and not the other. In that regard, it’s a significant finding because no one has looked at this level of resolution before,” he said. “But I’m not surprised we didn’t find it. We may be looking for one cell in a million.”

The study isn’t just the first to fully analyze the genomes of a pair of twins, one of whom has MS, but it’s the first detailed genomic analysis of any pair of twins – period. It is also the first to analyze someone with an autoimmune disease.

That’s hope for the future.

This blog is now located at http://thefehblog.blogspot.com/.
You will be automatically redirected in 30 seconds, or you may click here.

For feed subscribers, please update your feed subscriptions to
http://thefehblog.blogspot.com/feeds/posts/default.

Yesterday, the FEHBlog reminded readers that FEHB plans cannot accelerate implementation of the increase in the dependent child limiting age from age 22 to 26 because the FEHB Act specifies the current age 22 ceiling. Today, the Federal Times reports that

The Office of Personnel Management is working with Congress to implement the health reform law early by allowing health insurance coverage of employees’ adult dependent children up to age 26 before Jan. 1. If current laws are not changed, however, dependents age 22 and older will have to wait until 2011 for coverage.

It occurs to me that OPM may be working with Congress to add this change to the pending bills that would extend FEHB coverage to same sex domestic partners.

Last Thursday, the Centers for Medicare and Medicaid Services chief actuary Richard Foster released his report estimating the cost impact of the new health care reform law which Congress enacted in March. I strongly encourage everyone to read this report.

Mr. Foster finds that the new law will cause a net increase in health care spending over the next decade (est. $253 billion) while adding 34 million to the health insurance roll, principally Medicaid. Business Insurance reports that “The number of people enrolled in employer-sponsored plans will actually decline slightly when the new health care reform law is implemented fully” as people shift into the Exchanges and Medicaid.

The minority staff of the Joint Economic Committee published a report on the sizeable health insurer fee which the health care reform law applies to insured plans beginning in 2014. The fee is charged to insurers based on net premiums and is not tax deductible. It starts at $8 billion in 2014 and grows to $14.3 billion in 2018 (and indexed to medical inflation thereafter). This fee along with the fees on medical device manufacturers, brand name pharmaceuticals, etc. all will fall on the consumer. It’s no wonder that the CMS chief actuary expects the health care reform bill to bend the health care cost curve up.

Modern Healthcare reports that “HHS Secretary Kathleen Sebelius said government officials are expecting to face continued resistance from the insurance industry to some aspects of the reform bill, even as the commercial payers are implementing other aspects earlier than mandated deadlines.” I note that many insurers are accelerating implementation of the increased age 26 ceiling for dependent children. As OPM has indicated, this change will take effect for the FEHB Program on January 1, 2010. FEHB plans cannot make this change any earlier because the FEHB Act, 5 U.S.C. Sec. 8901, sets the ceiling at age 22.

In my view, HHS generates insurer resistance by, for example, issuing regulations, such as the February 2, 2010, interim final regulations implementing the 2008 federal mental health parity law, that cater to the medical profession and bend the cost curve up. I am concerned that HHS will follow the same path with the regulations implementing the health care reform law.

As previously noted on the FEHBlog, a group of managed behavioral health organizations known as the Coalition for Parity has challenged the validity of those mental health parity regulations in federal court. On April 14, the Coalition for Parity filed a summary judgment motion together with a supporting memorandum and statement of undisputed material facts. The Government’s response is due on May 3, and any reply is due on May 7. A federal district court decision should be handed down soon after oral argument of the motion (which I assume will take place). 

On Monday, the FEHBlog discussed an OPM proposed rule which would change the annual Open Season period to the month of November. I expressed my surprise that according to the rule’s preamble, OPM intended to make this change effective this year. I now understand that in the final rule OPM will implement this change next year 2011.

OPM issued a final rule concerning the Federal Employees Dental and Vision Insurance Program on Tuesday. The new regulations, which is effective on May 20, 2010,  permit (1) retroactive FEDVIP enrollment changes when an enrollee has lost his or her spouse through death or divorce or the enrollee’s last eligible child dies, marries, or reaches age 22 and (2) the enrollment of an individual up to 31 days before, as well as up to 60 days after, the enrollee or an eligible family member loses other dental and/ or vision coverage.

The FEHBlog recently discussed a Congressional Research Service report concerning a flawed provision of the health care reform act (PPACA) which called into question the availability of FEHB Program coverage for Members of Congress and their official staffs. The Washington Post reports today that

the Office of Personnel Management has concluded that the section of the law forcing them into the exchanges doesn’t take effect until the exchanges become operational and that no one will lose his or her insurance. “The provision . . . has no current effect upon the eligibility of Members of Congress or their staffs to participate in the Federal Employees Health Benefits Program,” OPM Director John Berry wrote in the letter, dated Friday and sent to House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry M. Reid. (D-Nev.).

On Monday, the Centers for Medicare and Medicaid Services announced a proposed rule on Medicare Part payments to hospitals for the federal fiscal year 2011 that begins on October 1, 2010. “CMS is proposing to update acute care hospital rates by 2.4 percent for inflation, a slight increase over the FY 2010 inflation rate, and apply an adjustment of -2.9 percentage points to recoup one-half of the estimated excess spending in FY 2008 and 2009 aggregate payments, due to changes in hospital coding practices that did not reflect increases in patients severity of illness.” CMS expects to make a further proposal that addresses PPACA required changes to Medicare Part A’s hospital payment rules.

AIS recently released reports on PPACA’s provisions authorizing the Food and Drug Administration to create a regulatory pathway for approval of biosimilar drugs and a new Comparative Effectiveness Research Institute which AIS expects to study biosimilars. Biosimilars bear the same relationship to expensive speciality or biologic drugs as generic drugs bear to brand name prescription drugs. Biosimilars are expected to generate large cost savings over time.

NCAQ President Mary E. O’Kane recently opined on tiered PPO network which “allow consumers to choose physicians in a higher performing tier while encouraging those in lower performing ones to improve their performance.”NCQA points out that

A recent study in the American Journal of Managed Care analyzed consumer awareness, use and trust of a tiered provider network. The study showed that using tiered networks to help consumers choose physicians requires increased consumer education.

The U.S. Office of Personnel Management (“OPM”) issued a proposed rule in the Federal Register today that, if finalized,

• would change the annual FEHB Program Open Season from the Monday of the second full workweek in November through the Monday of the second full workweek in December, to November 1st through November 30th of each year, and
• would allow FEHB employee organization sponsored plans and FEHB comprehensive medical plans (or HMOs) to offer three options, without the current requirement that one of the options be a high deductible health plan.

Surprisingly (to me at least) OPM intends for the Open Season schedule to change this year.  OPM also proposes to make a couple of regulatory changes that are mandated by federal statute.  OPM is accepting public comments on this proposed rule until June 18, 2010.