The debate over healthcare reform continues in the Senate. Reuters reports tonight that

Senator Dick Durbin, the Senate’s No. 2 Democrat, said the Senate would vote on Thursday on two competing measures to ensure women have access to mammograms and other preventive screenings and two amendments on proposed spending cuts in the Medicare government health program for the elderly.

The agreement requires that the amendments, which include one offered by Republican Senator John McCain to strike Medicare spending cuts from the bill, win 60 votes in the 100-member Senate in order to pass.

The New York Times reports that

As the skirmishing continued on the floor, the American Medical Association endorsed the thrust of the Senate bill. In a letter to Mr. Reid, the doctors’ group praised the measure’s strict federal regulation of health insurance and new tax credits to help low- and moderate-income people buy coverage.

But the medical association objected to some provisions, including
a new tax on “elective cosmetic medical procedures” and creation of an
Independent Medicare Advisory Board that could “mandate payment cuts for
physicians.”

The association also objected to antifraud provisions that it said could penalize doctors who make “an honest mistake,” with no intent to defraud Medicare or Medicaid. And it complained about a section that would impose new restrictions on
doctor-owned hospitals.

The provisions pale in comparisons to the burdens that the Senate bill would impose on health insurers, such as the $6.7 billion annual fee, the 40% excise tax, and the $25 billion “stabilization” fund. Sen. Charles Grassley issued a press release yesterday expressing dismay over the fact the the Senate leadership’s health care reform bill carved back his initiative approved by the Senate Finance Committee to shift Senators, Representatives, and Congressional employees from the FEHB Program to the state based health insurance exchanges.

Grassley said he’ll offer an amendment to restore his amendment, which the inance Committee accepted without objection, and which the Congressional
Research Service said made clear that leadership and committee staff would be
required to access the new exchange.

Grassley said his floor amendment also will expand the requirement to include the President, the Vice President and all political appointees in the executive branch.

Business Insurance reports that the Labor Department has issued new guidance on the continuation coverage subsidy created by the February 2009 economic recovery act.
“’An individual who does not become eligible for COBRA until after Dec. 31, 2009, does not meet the qualifications to be an assistance-eligible individual and would therefore be ineligible for the ARRA premium assistance,’ the Labor Department said.” Involuntary termination of FEHBP coverage generally is subject to an automatic 31 day extension of coverage. Consequently, if an employee was involuntarily terminated on November 30, he would receive a 31 day extension of coverage, and he would not be eligible for TCC, the FEHBP’s version of COBRA until after December 31, 2009. Consequently, he would not be eligible for the premium subsidy according to this guidance. Efforts are underway on Capitol Hill to extend the premium subsidy beyond the end of this month as previously noted in the FEHBlog.Forbes Magazine reports that

Medco Health Solutions Inc. and Coventry Health Care Inc. said Tuesday they will work together to see if they can reduce health care costs for senior citizens by addressing factors like home safety, diet and medication use.

The companies say they will conduct a study to determine if they can reduce hospitalizations for seniors on Medicare. Teams of Coventry and Medco employees will identify patients who are at the most risk for hospitalization, and work with their physicians and other agencies to find factors that can cause poor health, and they will keep in touch with patients through regular visits and phone calls.

Gook luck to them with this study.

I hope that everyone had a pleasant Thanksgiving holiday. Due to the long holiday weekend, there’s not much to update this Sunday. The Senate will begin to debate Sen. Majority leader’s healthcare reform bill tomorrow. The Wall Street Journal reports that “Debate on the bill will officially begin at 2 p.m. Monday with opening statements from Mr. Reid and Minority Leader Mitch McConnell (R., Ky.). But it starts in earnest on Tuesday when Democrats and Republicans begin offering alternating amendments.” The Journal and the AP report that many amendments are expected. The Senate leadership will need 60 votes to shutoff debate and hold a vote on the bill or any amendment for that matter.

The Kaiser Family Foundation’s side by side comparison of the House and Senate health care reform bills can be found here.

Joe Davidson of the Washington Post reports that two judges from the U.S. Court of Appeals for the Ninth Circuit have ruled that the FEHB Program must cover the same sex spouses of their court employees. These orders were issued in the context of the court’s Employment Dispute Resolution Procedure. There is a federal court case pending in Massachusetts raising this issue in a setting that would create a precedent. I expect that Congress will act on the pending legislation to extend FEHB Program coverage to same sex domestic partners (H.R. 2517, S. 1102) before then.

Modern Healthcare reports that Sen. Robert P. Casey, Jr. (D Pa) and four colleagues have introduced a bill to extend the Recovery Act’s COBRA / Temporary Continuation of Coverage subsidy from nine to fifteen months and to increase the subsidy from 65% to 75% of the premium.

The Associated Press is reporting about questions over the fairness of the 40% excise tax that the Senate leadership bill would impose on health plans whose premiums exceed a certain premium threshold as previously discussed in the FEHBlog. “Quite a conundrum” as Newman would say on Seinfeld.

U.S. Office of Management and Budget Director Peter Orzag announced on his blog that “This [past] weekend, the Senate completed the OMB team when it confirmed Dan Gordon to lead the Office of Federal Procurement Policy (OFPP). Dan brings more than two decades of professional contracting experience to OMB, having most recently served as Acting General Counsel at GAO.” This position is relevant to the FEHB Program because all FEHB plans are established by federal procurement contracts.

Finally, Melinda Beck of the Wall Street Journal reported on 20 health care advances for which to be thankful this week. I consider Ms. Beck to be the anti-Chicken Little.

The Senate decided last night on a straight party line 60-39 vote to proceed to debate Majority Leader Reid’s health care reform bill (H.R. 3590). The debate will begin on November 30 following the Thanksgiving holiday break. The debate is expected to last at least three weeks, and the Majority Leader will need 60 votes to cut off debate and bring the measure to a vote. Abortion coverage restrictions, overall cost, and public option remain hot topics.

The economic recovery act that Congress passed in February 2009 provided significant funding for the expansion of electronic health records. The House passed a bill (H.R. 3014) this week that would create a small business loan program for electronic health record technology. Reuters reports about an American Journal of Medicine report by Harvard Medical School researchers who concluded that so far the savings from electronic health records at hospitals have not materialized. Researcher David Himmelstein warned that “Claims that health IT will slash costs and help pay for the reforms being debated in Congress are wishful thinking.”

Govexec.com reports on the impact that the 2008 federal mental health parity act will have on FEHB Program coverage next year. Throughout this decade, FEHB Program participants have enjoyed cost sharing parity between mental health and medical/surgical benefits for services rendered by in-network providers. The new law requires cost sharing parity for services rendered by out-of-network providers if the plan offers out of network coverage. The article also notes that

[S]everal health plans are expanding coverage for childhood obesity preventative care. BCBS plans offer four free nutritional counseling sessions with a preferred provider for qualified children in the Jump 4 Health education program. Both the Rural Carrier and Mail Handler plans cover an annual body mass index testing for enrollees ages 2 to 21.

Last evening, Senate Majority Leader Harry Reid (D Nev) introduced his leadership’s health care reform bill which is 2074 pages long. The AP compares the House approved bill with Senator Reid’s bill here. Debate is expected to begin after Thanksgiving.

Today the House passed the Medicare doctor payment fix (HR 3961) demanded by the American Medical Association as Modern Healthcare reports. While Senator Reid’s bill would pile new fees on top of health insurance provider (see AHIP press release), including FEHB plans, doctors skate. The Senate previously rejected this bill, but the doctors typically get their way.

The House Oversight and Government Reform Committee approved today a bill that would extend FEHB Program coverage to same sex domestic partners (H.R. 2517). Govexec.com reports that amendments were adopted that require the GAO to report to Congress on the impact that the legislation has on FEHB premiums and on federal hiring and retention. The bill now can move to the House floor. Companion legislation is pending before the Senate Homeland Security and Government Operations Committee.

The Federal Times reports about health care reforms impact on the FEHB Program. The article reflects on the future of the Sen. Grassley (R Iowa) amendment to shut down the FEHB Program in favor of the state based health insurance exchanges and the Sen. Wyden (D Ore.) amendment to open the FEHB Program to all comers. I can’t imagine either amendment being adopted. The impact of this legislation on the FEHB Program would take longer to develop.

Politico shared with the public today a letter that a group of “distinguished economists” wrote the President approving healthcare reform efforts. What’s troubling is that the letter expressly describes the Senate Finance Committee bill’s Cadillac plan tax as a critical element of reform, and that tax, combined with the bill’s $6.7 billion assessment on health plans, would have a direct adverse impact on the FEHB Program principally because of its demographics. The Program would be penalized because of its demographics plain and simple.

The New York Times reported yesterday on the impact of the Genetic Information Non-Discrimination Act which becomes applicable to the FEHB Program on January 1, 2010.

The AP reported today that “The government paid more than $47 billion in questionable Medicare claims including medical treatment showing little relation to a patient’s condition, wasting taxpayer dollars at a rate nearly three times the previous year.” Senator Chuck Grassley, an Iowa Republican, announced that he had introduced a bill to fight Medicare fraud. Sen. Grassley states that

Right now, federal law requires that Medicare send payment within a very short time frame, even when there is risk of fraud, waste or abuse. “Because of this prompt payment rule, the government puts itself in a position of having to pay and chase Medicare fraud, instead of working to prevent it in the first place. That doesn’t make any sense,” Grassley said, “and it’s no way to manage Medicare’s resources.”

Slowing down the process would help reduce fraud and simple payment errors, in my view. That’s why I’m concerned that the healthcare reform bills approved by the House and pending in the Senate would require the Department of Health and Human Services to issue new HIPAA transaction standards that would allow for near real time eligibility and claim payment determinations. Calling Tony Soprano and crew. (It’s also ironic that HHS has not completed issuing the HIPAA transaction standards that Congress directed in 1996. The government simply should not be creating technology standards.)

That’s why I chuckled to myself when I read a Govexec.com article about how

At the Holiday Park Senior Center in Wheaton, Md., Democratic Rep. Chris Van Hollen, tried to assure a crowd of about 200 people, mostly retirees, that current health care reforms under consideration would not have an adverse effect on their federal health benefits. Many current and former federal employees reside in Van Hollen’s Montgomery County congressional district.

This two thousand page piece of legislation is bound to unexpected effects on the FEHB Program. For example, according to the article, “Van Hollen said the public option would expand the choices available to FEHBP enrollees by encouraging insurers to lower their prices for everyone.” The public option, assuming that its premiums are more attractive than FEHB plan offerings, will lead to adverse selection against the FEHBP and higher rates for those who stay in the program.

Reuters reports Senate Minority Leader Mitch McConnell’s prediction made today that the health care reform bill, once introduced in the Senate, “will be on the floor for quite a long time.” Senate Majority Leader Harry Reid has indicated that the bill which combines the Senate Finance Committee and Senate Health Education Labor and Pensions Committee approved bills will be submitted this coming week.

The Chief Actuary of the Centers for Medicare and Medicaid Services (“CMS”), Richard S. Foster, has issued his estimate of the financial effects of the health care reform bill (H.R. 3962) approved by the House of Representatives on November 7. He projects that the national health insurance coverage provisions of the bill would cost about $935 billion in order to extend coverage to 34 million people. Medicare savings would offset about $571 billion of this amount. However, those Medicare savings would be cut just about in half if the AMA gets its way and Congress repeals the sustainable growth rate formula for calculating Medicare reimbursement to doctors (H.R. 3961). He predicts that the health care system would not be able to handle the initial surge of new insureds, leading to price increases and cost shifting. He does not believe that the devices in the bill to bend the health care cost curve would be fruitful.

On Friday, CMS announced that

the results for the 2008 Physician Quality Reporting Initiative (PQRI). More than 85,000 physicians and other eligible professionals who satisfactorily reported quality-related data to Medicare under the 2008 PQRI received incentive payments totaling more than $92 million, compared to $36 million in 2007. The number of eligible professionals who earned an incentive payment increased by one-third from 2007, when 56,700 eligible professionals earned an incentive payment. In 2007, eligible professionals could only participate in the program during a 6-month reporting period. In 2008, the program expanded to allow reporting for either a 6-month or a 12-month period.Eligible professionals who participated in the 2008 PQRI can access confidential feedback reports that aggregate the data they submitted across all practices with which they are associated. The reports also show eligible professionals how they compare with other participants across the country who have submitted the same measures. CMS redesigned these reports for 2008 based on feedback from national stakeholder focus groups. Features in the new report include additional data formats and more information about reporting and performance rates per measure.

I think that I’ll ask my doctor amigos whether they participate in PQRI.Speaking of Medicare, the Medicare Advantage (Part C) and Prescription Drug Plan (Part D) open enrollment period starts tomorrow and runs through December 31 according to a CMS press release. “Beginning on November 15th, beneficiaries can go to www.medicare.gov or call 1-800-MEDICARE (1-800-633-4227) to make changes in their Medicare prescription drug and health coverage. People in Original Medicare without prescription drug coverage can enroll in a drug plan or health plan that offers drug coverage during Open Enrollment.”

In the spirit of Open Season, the Federal Times reports on 2010 changes in the Federal Employees Dental and Vision Insurance Program (or FEDVIP). “About 813,000 employees and retirees have dental coverage under FEDVIP and more than 570,000 are signed up for vision coverage, according to an Office of Personnel Management fact sheet issued in September.”

OPM and its Federal Employees Long Term Care Insurance Program contractor Long Term Care Partners are working to correct errors in letters that the contractor sent Program enrollees, according to an OPM press release.

Responding to OPM’s request, Long Term Care Partners reports they will begin mailing notices to the approximately 71,600 affected individuals, alerting them to the errors about the premiums shown in the “Benefit Amount” section of their election letters. The company also reports that in December, they will mail personalized letters providing accurate information to affected enrollees so that they can make an informed decision using correct information.

“Getting accurate, easy to understand information to our enrollees in a timely manner is my top priority,” said OPM Director John Berry. “All companies participating in this program must take steps to ensure that similar errors are avoided in the future.”

Due to the error, Long Term Care Partners is extending the decision period for those who received an erroneous letter to March 15, 2010, giving enrollees sufficient time to review their options.

Reuters reports that the Business Roundtable released a Hewitt Associates report on health care reform that appealed to all sides of the debate. According to the Roundtable’s press release,

“This report shows that effective reforms can slow health care costs by as much as $3,000 per employee in 2019,” said Antonio M. Perez, Chair of Business Roundtable’s Consumer Health and Retirement Initiative and Chairman and CEO of Eastman Kodak Company. “Health care reform done right could reduce the growth rate of health care costs – not just for government, but for the private sector as well. This must be a key measurement of success for Business Roundtable and the economy as a whole, and will be a key factor of businesses’ review of the final health care legislation. The report also shows that reform done wrong won’t work and could make a bad situation much worse, in which case Business Roundtable could not support the bill. Making the right choices as the final health care bill gets crafted is essential, and we are committed to working with Congress and the Administration toward a bill we can support.”

Reuters is reporting that pharmacy chain / prescription benefit manager “CVS Caremark Corp. (CVS.N) is trying to fix problems in its pharmacy benefits management business and wants to find a new leader to run the unit by the end of this year, Chief Executive Tom Ryan said on Thursday.” The Dow Jones News Wires adds

Ryan’s comments came days after CVS Caremark detailed a net $4.8 billion in lost pharmacy benefit management, or PBM, accounts for 2010, disclosed that the Federal Trade Commission was investigating company business practices and announced that the president of its PBM is retiring. The company expects to complete a search for a new PBM head by year end, in time for the 2011 “selling season” that starts early next year, he said.

The Dow Jones Newswires also reported today that Coventry Healthcare has sued CVS Caremark in federal court in Tennessee.

Coventry Health, which is moving more than $1 billion a year worth of pharmacy-benefits-management business from CVS Caremark to a rival PBM [Medco Health Services], accuses the company of wrongfully paying hundreds of thousands of dollars or more in prescription drug claims [involving military pharmacies and Medicaid beneficiaries.

According to the report, CVS Caremark denies the allegations.