FEHBlog

OPM has posted its 2018 Federal Benefits Open Season webpage which provides a link to the 2018 FEHB plan comparison tool. The Open Season runs from November 13 to December 11.

Congress will be in session this coming week on Capitol Hill. Here’s a link to the The Week in Congress’s report on last week’s actions.

Reuters reports that “U.S. pharmacy operator CVS Health Corp and health insurer Aetna Inc are working toward finalizing merger terms and announcing a deal for more than $70 billion as early as December, according to people familiar with the matter.” The initial unofficial reports suggested a deal valued at $60 billion or $200 per Aetna share.

The Wall Street Journal reports that

Anthem Inc.’s Chief Executive Joseph R. Swedish will step down, and the insurance giant will name veteran managed-care executive Gail K. Boudreaux as its next leader, according to people with knowledge of the matter. 

It wasn’t immediately clear how quickly the transition will occur, but the plan is expected to be announced as soon as next week, the people said. Mr. Swedish is expected to keep his title as chairman for a transition period, one of the people said.

Finally, the Omaha World Herald offers an interesting article on a new direct primary care model that 23 states including Nebraska have adopted.

Under the arrangement, patients pay a monthly membership fee to their doctor, generally under $100 a person. Patients, in turn, get their primary care needs met, all without having to file insurance claims, meet deductibles or pay copays. Patients generally get longer appointments and increased access to their health care providers through unlimited visits and contacts via cellphone, text, websites or secure apps.

This has the potential to lower the cost curve and improve healthcare quality in the FEHBlog’s view. The article notes that

Two of the Omaha area’s newest direct primary care offerings, in fact, are being launched not by physicians but by other players in the health care sector:
» Subsidiaries of Blue Cross Blue Shield of Nebraska and the Clarkson Foundation are partnering to open the Nurture Health clinic in January on the second floor of the Think building at 7100 West Center Road.
» CHI Health is offering for next year a direct primary care program for individuals and businesses as well as a slightly different version for employees, both at its clinic at 132nd Street and West Center Road. The health system has had a pilot program running since July 1 with about 150 patients, some 80 of whom are not employees of CHI. More than 1,000 people, between CHI employees and their dependents, signed up for the employee direct primary care option during the health system’s open enrollment period, which ended midweek.

Imitation is the sincerest form of flattery.

Following up on yesterday’s post about CMS’s release of a final rule on Medicare Part B reimbursement to physicians, Becker’s Hospital CFO report provide six takeaways which includes the FEHBlog’s lead takeaway about an increase in telehealth spending. Becker’s also notes that

Physician payment rates will increase 0.41 percent in 2018 compared to this year. CMS arrived at this increase after accounting for a 0.5 percent increase required by the Medicare Access and CHIP Reauthorization Act and a negative 0.09 percent adjustment required under the Achieving a Better Life Experience Act of 2014.

Earlier this week, the Leapfrog Group released its latest hospital safety grades.  Typically when the FEHBlog makes note of this event, he remarks that there are no A graded hospitals in Maryland, his home state. The Leapfrog Group press release alerts us that

One state appears on the state rankings for the first time today, the state of Maryland. Maryland had previously been the only state unable to be graded due to an exemption from reporting key safety metrics at the national level. Unfortunately, Maryland ranked fourth from the bottom. Of the 44 hospitals graded in Maryland, just one (2.3%), Howard County General Hospital in Columbia, earned an “A”

When the FEHBlog took a look at the grades of hospitals within 50 miles of his home zip code in Maryland, it appeared that 40-50% of the facilities declined to participate. 

For new parents out there, the Centers for Disease Control has created a new app called Milestone Tracker. The free app allows you to

Track your child’s milestones from age 2 months to 5 years with CDC’s easy-to-use illustrated checklists; get tips from CDC for encouraging your child’s development; and find out what to do if you are ever concerned about how your child is developing.

Handy!

Yesterday, the Presidential Commission on Combating Drug Abuse and the Opioid Crisis issued its final recommendations to the President. Here’s a link to the USA Today report on this issuance.

The commission called for 56 specific policy changes, including:
*Creating uniform block grants for all federal opioid and substance abuse funding, making it easier for states to navigate the multiple grant programs currently available across several federal agencies.
*Requiring health-care providers to complete an educational program on opioids before they can renew their federal prescriber licenses.
*Requiring states to share data from their prescription drug monitoring systems as a condition of receiving certain federal money for those initiatives.
*Establishing federal drug courts in all 93 judicial districts across the country, so those arrested for possession can be diverted to treatment instead of prison.
*Giving the Department of Labor more power to crack down on insurance companies that discriminate against those with substance abuse disorders.
“Just spending money won’t be enough,” Christie said, adding that federal funding must be directed to programs that have been proven to be effective. “Now it’s incumbent upon Congress to step up” and give the administration the resources it needs to combat the epidemic, Christie added.  

Oh joy, more crackdowns on insurers.

Also yesterday, CMS issued a final Medicare rule which inflamed the hospital industry by making a huge cut for drugs sold by hospitals. Hospitals plan to challenge the rule in court according to Fierce Healthcare. Of course, the old standby is to shift Medicare losses onto private sector plans, including FEHB plans.

Today, CMS issued a final Medicare Part B physician payment rule for 2018. Of note —

To strengthen access to care, especially for those living in rural areas, CMS is transforming access to Medicare telehealth services by paying for more services and making it easier for providers to bill for these services. Improving access to telehealth services reflects CMS’s work to modernize Medicare payments to promote patient-centered innovations.

OPM announced today that is withdrawing a proposed rule concerning  FEHBP contributions for employees in leave without pay or other nonpay status. The rule had been proposed on August 31, 2016. OPM concluded that the rule was not necessary. Well done.

Drug Channels reports on the latest tidbits about Amazon’s planned entry into the pharmacy business, and CAQH CORE compliments three nationwide FEHB plans, APWU, GEHA, and NALC, for obtaining certification that their claim systems are compliant with HIPAA’s operating rules for electronic transactions.

Happy Halloween.

The Senate Homeland Security and Governmental Affairs Committee held a business meeting yesterday at which it approved for final Senate consideration the President’s nomination of Emily Murphy to be General Services Administrator. The FEHBlog vainly hoped that the meeting would be televised in case there was some discussion about the status of the OPM nominees. No such luck.

The FEHBlog also hoped to attend the HCP LAN conference yesterday but law firm demands prevailed. Helpfully, CMS posted CMS Administrator Seema Verma’s remarks at the conference. Here’s the beginning.

“We need to move from fee-for-service to a system that pays for value and quality – but how we define value and quality today is a problem,” said Administrator Verma. “We all know it: Clinicians and hospitals have to report an array of measures to different payers. There are many steps involved in submitting them, taking time away from patients. Moreover, it’s not clear whether all of these measures are actually improving patient care.”
Administrator Verma announced a new approach to quality measurement, called “Meaningful Measures.” Meaningful Measures will involve only assessing those core issues that are most vital to providing high-quality care and improving patient outcomes. The agency aims to focus on outcome-based measures going forward, as opposed to trying to micromanage processes.
Additional agency efforts that Administrator Verma highlighted include:

• CMS is moving the Innovation Center in a new direction that will promote greater flexibility and patient engagement.
• CMS is implementing the Medicare Access and Chip Reauthorization Act (MACRA) in a way that minimizes the burden and costs providers face in meeting the requirements. 

“Our overall vision is to reinvent the agency to put patients first,” Administrator Verma said during her address. “We want to partner with patients, providers, payers and others to achieve this goal.” 

This all makes sense to the FEHBlog.  She doubles down the move away from fee for service but with a lighter and more sensible regulatory touch.

Fedsmith.com has posted a National Association of Postal Supervisor’s list of FEHB plans that will reimburse Medicare prime annuitants for a share of their Medicare Part B premiums in 2018.  OPM has been encouraging carriers to take this step. CMS still hasn’t announced 2018 Medicare Part B premiums and cost sharing amounts yet.

The Internal Revenue Service today released Notice 2017-67 which implements the perhaps most significant provision of the President’s recent executive order on health care. The notice clarifies that small business (under 50 full time employees as defined by the ACA) can use health reimbursement accounts to fund employee purchase of coverage in the ACA marketplace up to certain dollar limits and other reasonable requirements.  The notice combines this flexible small business HRAs created by the 21st Century Cures Act (“QSEHRAs) and the President’s initiative to allow the funds in these accounts to purchase marketplace coverage. The FEHBlog could never understand why in 2013 the IRS blocked this approach which should add enrollment to the marketplace.

The House of Representatives and the Senate will be in session on Capitol Hill this coming week. The Senate Homeland Security and Governmental Affairs Committee will hold a business meeting afternoon to consider the nomination of Emily Murphy to be General Services Administrator.  The Committee initially intended to consider Ms. Murphy’s nomination along with the OPM Director and Deputy Director nominations. However, the Committee Chair Sen. Ron Johnson (R Wisc.) severed Ms. Murphy from the OPM nominees in order to maintain pressure on the agency to comply with his records request as discussed in the FEHBlog last week. Here’s a link to the Week in Congress’s report on last week’s activities on Capitol Hill.

The Department of Health and Human Services is proposing the 2019 Benefits and Payment Parameters Notice as required by the ACA. The notice principally pertains to the individual and small business plans operating in the ACA marketplaces. The one provision of the notice that applies to the FEHBP is its announcement of the maximum annual limitation on cost sharing [e.g. deductibles, co-payments, and co-insurance]: 

[W]e propose [based on statutory requirements] that the 2019 maximum annual limitation on cost sharing would be $7,900 for self-only coverage and $15,800 for other than self-only coverage. This represents an approximately 7 percent increase above the 2018 parameters of $7,350 for self only coverage and $14,700 for other than self-only coverage.

As usual, Prof. Timothy Jost and a colleague offer comprehensive coverage of the Notice here.

On Saturdays, the FEHBlog enjoys watching the Wall Street Journal Editorial Board program on television. The panel this week turned to the President’s declaration that the opioid crisis is a national public health emergency.  The panel referred to Sally Satel, MD, as a helpful take on the crisis. 

The FEHBlog had not heard of Dr. Satel who turns out to be a psychiatrist and professor at Yale University, a prolific author, and a scholar at the American Enterprise Institute.  The FEHBlog thanks to You Tube watched a panel on the opioid crisis that Dr. Satel chaired. One of the panels was Christopher Caldwell who authored an April 2017 article titled “American Carnage: The New Landscape of Opioid Addiction.” The FEHBlog encourages you to read the article which provides a history of the our country’s problems with opioids which dates back to the Civil War and an overview of the current problems. 

The Wall Street Journal also reported over the weekend that CVS Health has been on a big hunt for a health insurer partner

CVS Health Corp.’s bid for Aetna Inc. is the culmination of a wide-ranging hunt by the drugstore giant for a deal partner, highlighting a broader effort among health-care companies to find new avenues of growth by combining diverse businesses under one roof. 

The Woonsocket, R.I., company has been examining different deal possibilities for about six months, according to people familiar with the matter. CVS approached Anthem Inc. ANTM 2.14% about potentially buying the health insurer, and discussed a combination with UnitedHealth Group Inc., the people said. In both cases, the talks were preliminary and informal.

Interesting.

Modern Healthcare reports that

MS launched an initiative Thursday to help it determine what provider regulations it should junk or revamp, citing growing concerns that its regulations are reducing the time providers spend with patients.
As part of the Patient over Paperwork initiative, CMS officials will travel the country to gather information on the impact their regulations have on physicians. Those conversations have been taking place informally for weeks.
The outreach effort comes at a time that primary-care physicians are spending 27% of their time on clinical activities and 49% on administrative activities, according to a 2016 Annals of Internal Medicine study. The CMS now releases around 58 rules, or 11,000 pages of regulation, each year. 

Kudos to CMS for this initiative but what is CMS is doing for Medicare Advantage and Prescription Drug plans or OPM doing for FEHB plans in this regard? The ACA after all put the greatest administrative and financial burden on health insurers.

The FEHBlog mentioned the rising use blockchains as a defense against cyberattacks, in particular distributed denial of service (DDoS) attacks a week or two ago. PC Magazine has a good article that explains the blockchain defense for the layperson.

The FEHBlog who is back in DC nearly fell out of his chair this afternoon when he read on the Wall Street Journal website that “CVS Health Corp. is in talks to buy Aetna Inc.  according to people familiar with the matter, in a deal that could value the health insurer at upward of $66 billion.”  The latest article indicates that the acquistion talks have been underway six months. The FEHBlog now understands why Aetna announced selling its U.S. life and disability insurance business to the Hartford earlier this week. Aetna is preparing for the acquistion which of course would require government approval. Both CVS and Aetna are heavily engaged with the FEHBP. 


In contrast, Healthcare Dive reports on the trend among health care systems to divest hospitals typically acquired in the wake of the ACA’s passage. . 

The FEHBlog noted on Sunday that the Senate Homeland Security and Governmental Affairs Committee planned to hold a business meeting today to consider the OPM Director, OPM Deputy Director, and GSA Administration nominations. Federal News Radio reports that the Committee indefinitely postponed the meeting.

“At this time, the committee cannot proceed to a vote on the nominations of OPM director and deputy director until OPM complies with the chairman’s request for documents related to the development of OPM’s regulation that exempted members of Congress from Obamacare,” a committee spokeswoman wrote in an email to Federal News Radio.

The FEHBlog sympathizes with the Committee Chair Sen Ron Johnson because the FEHBlog always expected that Congress would have to appropriate funds to provide an employer contribution toward marketplace coverage for staff members. The FEHBlog expected that members of Congress would wind up paying their own premiums in the marketplace like individual subscribers.

Nevertheless, the FEHBlog considers the Committee’s action to be short sighted. The FEHBlog expects that the Chairman would get answers from OPM more quickly if the Senate confirmed Dr. Jeff Pon and Michael Rigas as OPM Director and Deputy Director respectively.

“Today, House Ways and Means Committee Chairman Kevin Brady (R-Texas) and Senate Finance Committee Chairman Orrin Hatch (R-Utah) announced a bicameral agreement to pair concrete, structural Obamacare reforms with a temporary two-year funding extension for the health law’s cost-sharing reduction (CSR) program.”  Full legislative language is expected to be release this week. Heavens to betsy, the FEHBlog hopes that the full legislative language will include a repeal of the medical device and health insurer taxes and a further delay of the high cost employer sponsored plan / Cadillac plan excise tax from 2020 to 2026.  These taxes are not friendly to the FEHBP.

The Health Affairs blog is celebrating the fifth anniversary of ABIM’s Choosing Wisely campaign with a couple of interesting articles.  The campaign offers medical society recommended lists of medically unnecessary services that doctors should avoid and presumably health plans shouldn’t cover.

The American Hospital Association has released a toolkit of advice to hospitals and health systems on how address the opioid / illegal drug use epidemic. These folks are best positioned to address this problem.

Healthcare Dive tells us about a Centers for Medicare and Medicaid Services study aimed to determine whether MACRA (the current Medicare Part B reimbursement system) and physicians in the Merit-based Incentive Payment System (MIPS) can reduce Medicare spending. Capital idea.

Employee Benefit News reports about the Segal Company’s 2018 projections of employer sponsored health care spending. Drug Channels discusses Prime Therapeutic’s report on prescription drug spending. Prime Therapeutics is a prescription drug manager owned by a group of Blue Cross licensees. Both reports expects lower prescription drug spending.

Both Houses of Congress are in session on Capitol Hill this coming week. The Senate Homeland Security and Governmental Affairs Committee will hold a business meeting on Wednesday October 25 to consider the President’s nominations of Dr. Jeff T.H. Pon and Michael Rigas to be OPM Director and OPM Deputy Director respectively. Their nomination hearing were held last week. The rapid follow up is not surprising to the FEHBlog.

A Wall Street Journal columnist Holman W. Jenkins Jr. shredded to pieces a CBS 60 minutes / Washington Post investigation which alleged that Congress at the instigation of wholesale drug distributors had accelerated the opioid crisis by repealing authority held by the Drug Enforcement Agency in 2016.  The FEHBlog had noticed the Post article but he wasn’t buying what the Post was selling for the reasons that Mr. Jenkins explicated. Here are a few key points:

• [A]s the Centers for Disease Control and Prevention has pointed out, prescription opioid deaths remain roughly proportional to prescriptions written. The number of prescriptions, which tripled between 1999 and 2010, has been falling ever since. Today’s surging opioid death rate is due to black-market heroin and fentanyl.
• A federal survey finds misuse of prescription opioids peaked in 2012 and has returned to 2002 levels. 
• What we have here is a typical story of bureaucratic angst, promoted by the Post’s lead source, Joseph Rannazzisi, a former DEA official who now works for trial lawyers suing the drug industry.