FEHBlog

Congress remains at work on Capitol Hill this week. The Senate is expected to confirm Seema Verma to be Administrator of the Centers for Medicare and Medicaid Services.  The Senate Health Education Labor and Pensions Committee will hold a confirmation hearing for the President’s latest nominee for Secretary of Labor, R. Alexander Acosta, on Wednesday afternoon. These are both significant positions in terms of ACA administration.

Modern Healthcare features an interesting article on the state of the burgeoning telehealth market. The large vendors are turning their attention to serving hospitals and health systems. It’s always seemed like a no brainer to the FEHBlog that telehealth services could help avoid unnecessary readmissions. But it appears that hospitals are using telehealth services to replace staff for inpatient services. Time marches on. We get closer to the Jetsons.

The FEHBlog et ux (look it up) have been listening to an audiobook of Malcolm Gladwell New Yorker articles. Today we heard Mr. Gladwell who narrates his own work describe the difference between puzzles and mysteries.

The national-security expert Gregory Treverton has famously made a distinction between puzzles and mysteries. Osama bin Laden’s whereabouts are a puzzle. We can’t find him because we don’t have enough information. The key to the puzzle will probably come from someone close to bin Laden, and until we can find that source bin Laden will remain at large.
The problem of what would happen in Iraq after the toppling of Saddam Hussein was, by contrast, a mystery. It wasn’t a question that had a simple, factual answer. Mysteries require judgments and the assessment of uncertainty, and the hard part is not that we have too little information but that we have too much. The C.I.A. had a position on what a post-invasion Iraq would look like, and so did the Pentagon and the State Department and Colin Powell and Dick Cheney and any number of political scientists and journalists and think-tank fellows. For that matter, so did every cabdriver in Baghdad.
The distinction is not trivial. If you consider the motivation and methods behind the attacks of September 11th to be mainly a puzzle, for instance, then the logical response is to increase the collection of intelligence, recruit more spies, add to the volume of information we have about Al Qaeda. If you consider September 11th a mystery, though, you’d have to wonder whether adding to the volume of information will only make things worse. You’d want to improve the analysis within the intelligence community; you’d want more thoughtful and skeptical people with the skills to look more closely at what we already know about Al Qaeda. You’d want to send the counterterrorism team from the C.I.A. on a golfing trip twice a month with the counterterrorism teams from the F.B.I. and the N.S.A. and the Defense Department, so they could get to know one another and compare notes.
If things go wrong with a puzzle, identifying the culprit is easy: it’s the person who withheld information. Mysteries, though, are a lot murkier: sometimes the information we’ve been given is inadequate, and sometimes we aren’t very smart about making sense of what we’ve been given, and sometimes the question itself cannot be answered. Puzzles come to satisfying conclusions. Mysteries often don’t.

Drug pricing falls into the mystery category. Indeed all health care pricing falls into the mystery category. But drug pricing is a peculiar mystery.  That’s why the FEHBlog appreciate the Drug Channels blog which lately dicusses a Johnson & Johnson subsidiary pricing transparency report. He gives it two thumbs up.  Check it out.

Here’s a link to the Week in Congress’s one page report about what happened on Capitol Hill this week.  The Wall Street Journal reports that after two lengthy mark up sessions the House Ways and Means and Energy and Commerce Committees cleared the American Health Care Act for Budget Committee consideration next Wednesday. We should have a Congressional Budget Office score before then. The House leadership’s objective is to bring the bill to the House floor for a vote during the week of March 19. The bill would then head to the Senate for consideration under the reconciliation act rules which allow for Senate passage with 51 votes.  It’s not clear at this point what will happen in the Senate.

The Journal further reports that the House leadership will introduce a broader ACA replacement bill this month which the Senate would consider under regular order. Regular order allows for a filibuster which can be broken with sixty votes. The FEHBlog has read that there are other approaches which would allow for the Senate to get past a filibuster by the passage of time. Of course there is a Congressional Research Service report which discusses the two speech limitation which is an alternative to the sixty vote cloture rule.

Finally according to the Journal report, there are administrative “actions that the Trump administration can take on its own [under the terms of the ACA] . The administration has already issued rules intended to shore up the individual insurance market until the GOP vision of a new health system is enacted. Other changes may include giving states more flexibility in running Medicaid programs and allowing insurers to sell policies without maternity care or other benefits now required under law.”  The FEHBlog views this as loosening the choke chain that the ACA placed on insurers. He looks forward to this stage because it could simplify life for FEHB carriers.

The FEHBlog ran across this farewell address from the CEO of the Robert Wood Johnson Foundation  and because it’s upbeat here’s the link. Have a good weekend.

Yesterday, the House of Representatives began consideration of the American Health Care Act. House Speaker Paul Ryan explains that House consideration of the bill will be a multi step process leading to consideration on the House floor.

This week, the Energy and Commerce Committee and Ways and Means Committee are holding markups to consider their portions of the bill.  Next [after the Congressional Budget Office score is released], the work of these two committees will go to the Budget Committee to be considered as one bill. After that, the legislation will go to the Rules Committee [before reaching the House floor]. 

The Speaker emphasizes that the bill has been under development for over a year. Prof. Timothy Jost dissects the bill in Health Affairs.  The FEHBlog who appreciates the Goldilocks story takes heart in the Washington Post’s subheadline this morning that the bill is under attack from the left and the right.

OPM in its 2017 and 2018 call letter for benefit and rate proposals encouraged FEHBP carriers to adopt telehealth and value based insurance design. For that reason the FEHBlog calls readers attention to recent studies on those topics:

• A Health Affairs study “on the impact of a value-based pharmacy benefit on medication adherence found that offering free chronic disease medications maintained patients’ levels of adherence even after switching to a health plan with a deductible.”
• Another Health Affairs study on telehealth services finds that the services at this stage at least are a convenience and do not bend the cost curve down.  This comes as no surprise to the FEHBlog. Nevertheless Healthcare Finance identifies some useful conclusions from the study

The House of Representatives leadership released the American Health Care Act which is intended to repeal large parts of and replace the Affordable Care Act.

The bill does not include a provision that would tax employer sponsored premiums in excess of a dollar threshold as the FEHBlog discussed yesterday. For that reason, the bill retains the ACA’s Cadillac tax but pushed the effective date back from 2020 to 2025.

With respect to the FEHBP, the bill principally would preserve the ACA’s age 26 coverage provision, lift the statutory cap on flexible spending accounts (OPM would have to agree to increase the cap), lift the exclusion on HSA, HRA, and FSA reimbursement of over the counter medicines and increase maximum annual contributions to health savings accounts. The changes generally would take effect next year.

The bill would zero out the individual and employer mandates. The bill also would eliminate virtually all of the ACA imposed business and personal taxes beginning next year except for the Cadillac tax and the PCORI fee unfortunately.

The bill would provide an age rated, and income restricted advanceable tax credit to purchase individual health insurance. It would create a role for health insurance agents. The bill would permit the credit to be use to purchase health coverage which is not ACA compliant, e.g., catastrophic coverage. The bill’s provisions must pass muster from the Senate parliamentarian in order to be treated as a budget reconciliation act which can’t be filibustered in the Senate.

The Ways and Means Committee will mark up the bill on Wednesday morning.  At the same time on Wednesday, the Energy and Commerce Committee will consider the budget reconciliation aspects of this legislative action.

Congress remains in session this coming week on Capitol Hill. Here’s a link to the Week in Congress’s one web page account of last week’s activities on the Hill.  The House Oversight and Government Reform is holding a business meeting Wednesday morning to mark up a few bills. The postal reform bill is not one of them.  We shall see whether the Republican health care re-reform bill surfaces this week.

The FEHBlog hopes that the Republicans unveil a bill that will attract some support across the aisle. There is no doubt that the ACA needs to be overhauled. The last thing that the FEHBlog wants to see is Obamacare replaced by Trumpcare or Ryancare. Some form of bi-partisan bill would help insure a desirable degree of  permanency in the new legislation.

The FEHBlog was pleased to hear a radio interview with House Speaker Paul Ryan in which he indicated that the House reform bill will level the tax playing field.  An idea that the FEHBlog has seen floated around is to impose income tax on annual health insurance premiums above $8,000 for self only and $26,000 for other than self only. That assumes an average family size of 3.25.

Because the average family size in the FEHBP is closer to two people than 3.25 people, the average FEHB premiums for self only currently are close to $8,000 but the average premiums for other than self only are well below $26,000 annually. It would be a lot more equitable to allow all lower and middle income taxpayers whether covered under group or individual plans to continue to enjoy the exclusion while all higher income people lose half of the exclusion like self-employed business owners do today.

While we wait to see what develops, take a look at this Robert Woods Johnson Foundation tool which allows you to compare health costs among 500 U.S. cities.

The audio tape of the Nevils oral argument held before the U.S. Supreme Court on March 1 is now available here.  Yesterday a Columbia law professor wrote the most heartwarming conclusion in his analysis of the argument:

Given the delicacy of pre-emption doctrine in general, I would not expect this to be one of the first cases to come down from the February calendar. But I would be surprised if the justices fail to coalesce with near unanimity around some straightforward basis for reversing the Missouri court’s judgment.

Having now listened to the oral argument, the FEHBlog agrees with the good professor’s conclusion.

The FEHBlog discovered in PACER that yesterday Cigna submitted a short brief in Anthem’s appeal of last month’s decision to block the Anthem/Cigna merger. The case is pending before the U.S. Court of Appeals for the District of Columbia Circuit. The case is scheduled for oral argument on March 24 on an expedited basis (No. 17-5024). Cigna in its conclusion states that “Cigna defers to Anthem and to the conclusion in Anthem’s brief that this Court should reverse the district court’s February 8, 2017 Order in its entirety, vacate the injunction, and rule for Anthem and Cigna permitting the proposed merger of Anthem and Cigna to proceed.” So at this point Cigna is back to playing ball with Anthem following the Delaware Chancery Court’s decision blocking Cigna from terminating the merger agreement before April 30, 2017.

AHIP issued a report concluding that outpatient prescription drugs costs now take up the largest portion of the health benefits premium dollar, just eclipsing physicians services.

Finally, the FEHBlog is reading that the House of Representatives will begin committee consideration of a health care re-reform bill next week. The ACA can’t be replaced soon enough.  For example, Modern Healthcare reports that

The [ACA’s] 2.3% tax on medical device sales resulted in the loss of over 28,000 jobs among devicemakers and and related industries when it was in effect between 2013 and 2015, according to the American Action Forum, which describes itself as a “center-right policy institute.” Health economist Robert Book based his post on U.S. Census Data and tax data from the federal government.  

The tax, which is collected as a direct percentage of manufacturer sales, was suspended by Congress for 2016 and 2017. If Congress allows it to resume in 2018, AAF projects that an additional 25,000 additional jobs could be lost by 2021. AAF’s prediction is based on past job losses and lower-than-anticipated tax revenue, which would suggest a reduction in device sales. 

At 10 am this morning, an FEHBA-related oral argument will be held before U.S. Supreme Court.  This is the first time that the Supreme Court has heard an FEHBA case since 2006.   The Court will be considering the constitutionality of the FEHBA’s state law preemption provision. Without getting bogged down in detail (which the FEHBlog enjoys actually), the FEHBlog expects that the Court will uphold this important aspect of the FEHBA, which allows for uniform nationwide plan administration. A decision is expected before the end of June.

Healthcare Finance reports on last Monday’s meeting involving the President, the Vice President, the HHS Secretary and health insurance executives.  Last night, President Trump outlined his approach to repealing and replacing the Affordable Care Act. The Wall Street Journal explains that

Mr. Trump repeated his promise to overturn the 2010 health law, at a time when the party’s factions are threatening to withhold support for the effort if their demands aren’t met. He said a new health-care plan should ensure coverage for pre-existing conditions and minimize disruptions for people with coverage under Obamacare.  He backed the use of tax credits to help people buy coverage, expanding health savings accounts to pay for treatment and said governors needed the resources to continue to fund their Medicaid programs for the poor. 

We will see whether the President’s leadership can bring together the Republican members of Congress to enact this legislation.

OPM has stated that one of its plan performance goals is to improve the care provided to pregnant women, a worthy goal.  In that regard, the Leapfrog Group released its annual Maternity Care report yesterday.  Leapfrog explains

Having a baby is one of life’s most exciting experiences, but the type of care received in the hospital can vary greatly. Women and families should use Leapfrog’s hospital survey results to consider which hospital they’d like to use for their child’s delivery.This section of the survey examines five key areas of maternity care quality:

• Early elective delivery rate
• Rate of C-sections
• Rate of episiotomy
• Performance on standard processes of care
• Delivery outcomes for high-risk births

The majority of maternity care measures included on the Leapfrog Hospital Survey are endorsed by the National Quality Forum, including Early Elective Deliveries, Cesarean Sections, Episiotomy, as well as components of the Processes of Care and High-Risk Deliveries measures.  A selection of these maternity care measures are also utilized by The Joint Commission as part of their Perinatal Care measure set: Early Elective Deliveries, Cesarean Sections, and Antenatal Steroids (a component of the High-Risk Deliveries measure). Patients can search for how their hospital performs on these maternity care measures on the Compare Hospitals page.

Good work.

Congress returns to work on Capitol Hill following the Washington’s Birthday recess.  The Office of Management and Budget reportedly is expecting to send a first draft of the Fiscal Year 2018 budget to  Congress in mid-March.

Reuters reports that the President will meet with health insurance executives at the White House tomorrow. “Since taking office on Jan. 20, Trump has held a series of White House meetings with executives from different sectors including those from manufacturing companies, pharmaceutical makers, technology businesses and car makers.”

The Supreme Court will hear an FEHB case, Coventry Health Care v. Nevils, on March 1.  A Columbia Law School professor provides a preview of the oral argument on the Scotusblog.  Regrettably the FEHBlog’s schedule does not permit him to attend the oral argument in person.  Audio recordings of Supreme Court oral arguments are available on the Court’s website.

The FEHBlog ran across useful observations on last week’s HIMSS conference from a Health Data Management editor Fred Bazzoli and a Harvard Medical School CIO John Halamka. Also last week CMS consolidated its ICD-10 website.

The FEHBlog is out of town so this post will be shorter than usual.  Today, according to a Wall Street Journal report, the President issued an executive order “requiring each federal agency to form a task force to review existing regulations and recommend whether to repeal or simplify those deemed to harm the economy and job creation.”  These task forces should be busy. The FEHBlog trusts that they will look at subregulatory guidance as well as regulations. 

Thanks to the American Hospital Association News, the FEHBlog learned that the federal district court in DC posted Judge Amy Berman Jackson’s opinion (slightly redacted) blocking the Anthem / Cigna merger.  Anthem has appealed Judge Jackson’s decision to the D.C. Circuit.  The D.C. Circuit granted Anthem’s motion to expedite the appeal. A three member panel of D.C. Circuit judges will hear the appeal on March 24 (the second day of the OPM / AHIP FEHBP carrier conference). That means that an appellate decision could breathe new life into the merger before the agreement lapses on April 30.  It’s an odd situation because Cigna has filed a lawsuit in the Delaware chancery court seeking to be released from the agreement and damages from Anthem.  The Delaware court is waiting for the D.C. Circuit’s decision at this point.

Here are a couple of articles on the HIMSS’s conference:

• Fierce Healthcare reports on a discussion among federal official about improving patient access to electronic medical records and interoperability of those records. Those officials should have put more thought into those issue before releasing over $30 billion of taxpayer funds to help doctors and hospitals “invest” in electronic medical records that lack these features.  
• Medpage reports that 

The office dealing with health privacy at the U.S. Department of Health and Human Services (HHS) expects to have proposed regulations by the end of the year on compensating people whose healthcare privacy has been breached, an official said here Monday.

A provision in HITECH (the Health Information Technology for Economic and Clinical Health Act) requires HHS to come up with a way to give people who are harmed by violations of HIPAA a percentage of any civil monetary penalties or settlements collected, explained Deven McGraw, JD, MPH, deputy director for health information privacy at HHS’s Office for Civil Rights, at the the Healthcare Information and Management Systems Society (HIMSS) annual meeting.

The article delves into the serious legal issues that have delay this rule.  This development is just another headache for HIPAA covered entities and business associates that advantages the plaintiff’s bar.

Healthcare Dive discusses Healthgrades latest list of top hospitals in the U.S.  The FEHBlog does not understand the methodology behind this list which excludes outstanding tertiary hospitals like the Washington Hospital Center in DC, Johns Hopkins Hospital in Baltimore, and Yale New Haven Hospital in Connecticut, among others.

Fedweek features an article by a former OPM official Reg Jones who identifies three key features of our beloved FEHBP.

The Federal Employees Health Benefits program is one of the best benefits offered by the government. And it’s open to almost all federal and postal service employees.Three key features include the flexibility of the annual open season, the opportunity to change enrollment due to certain life events and the opportunity to carry coverage into retirement.

These valuable aspects of the FEHBP were baked into the original legislation in 1959.  It’s too bad that Congress did not take the same approach with Medicare six years later.