FEHBlog

On the cybersecurity problems front, CBS News reports that a Los Angeles hospital paid hackers $17,000 in Bitcoin ransom to unlock its unlawfully encrypted Thelectronic medical records system.

CBS News correspondent Carter Evans reports that according to a source familiar with the investigation, the hospital paid the ransom before contacting law enforcement. “If they decided to pay the ransom, it probably means that they didn’t have very good backups, they weren’t able to recover the data, and that the data would have been lost if they didn’t pay the ransom,” Dave Kennedy, CEO of the information security firm TrustedSec, told CBS News.

A report from Intel Corp.’s McAfee Labs released in November said the number of ransomware attacks is expected to grow even more in 2016 because of increased sophistication in the software used to do it. The company estimates that on average, 3 percent of users with infected machines pay a ransom.

The Washington Post reports at length this morning on efforts to treat the causes rather than the symptoms of mental illness.

The[se] efforts have been bolstered by advances in technology and imaging that now allow scientists not only to see deeper into the brain, but also to study single brain cells to determine which circuits and neurons underlie specific mental and emotional states. Many of these advances come from fields as disparate as physics and electrical engineering — as well as the new field of optogenetics, which uses light to manipulate neurons.

Best of luck.

Finally the Wall Street Journal reported last week on the cash economy for healthcare which exists beside insurance coverage. Oddly enough, before the Affordable Care Act, hospitals charged their highest rates to the uninsured. Now that health insurance is mandated, hospitals and other providers are willing to negotiate services like MRIs for cash.  Go figure. Not suprisingly, some of the change was encouraged by the zany ACA itself, and of course there’s a website for those who want to pay cash for their surgical procedure.  

The OPM Inspector General-triggered controversy over the legality of the acting OPM Director’s service since she was nominated to be permanent director continues to simmer.  The Washington Post reports that Ms. Cobert is not the only acting agency leader in the soup. The FEHBlog took the time last night to read the 28 page D.C. Circuit opinion (SW General, Inc. v. NLRB) upon which the Inspector General relies.  At the end of the opinion, the Court “emphasized” the “narrowness of our decision.” “[W]e do not expect it to undermine a host of NLRB decisions.” A party must have standing to and must actually bring a lawsuit challenging the validity of the acting agency leader’s decision in Court based on the Federal Vacancy Reform Act in order to upend any particular action.  It appears to the FEHBlog to be a tempest in a teapot.  The OPM IG retires today.

OPM now has posted its FY 2017 Congressional Budget Justification.  Fun reading for the weekend.  The budget justification discusses OPM’s FEHBP claims data warehouse.  The FEHBlog is not suggesting that there is any connection but the Wall Street Journal reported the other day that

Employee wellness firms and insurers are working with companies to mine data about the prescription drugs workers use, how they shop and even whether they vote, to predict their individual health needs and recommend treatments.

Trying to stem rising health-care costs, some companies, including retailer Wal-Mart Stores Inc., are paying firms like Castlight Healthcare Inc. to collect and crunch employee data to identify, for example, which workers are at risk for diabetes, and target them with personalized messages nudging them toward a doctor or services such as weight-loss programs.

Companies say the goal is to get employees to improve their own health as a way to cut corporate health-care bills.

Privacy advocates have raised concerns about such practices.

That’s a bridge too far in the FEHBlog’s view.

Here’s a link to an interesting Fierce Healthcare article about a Highmark subsidiary that helps hospitals cut costs on major medical device purchases. Bravo.

The OPM Inspector General’s retirement date is this coming Friday and he has thrown a grenade as he walks out the door.  The Washington Post is reporting today that the Inspector General has advised OPM Acting Director Beth Cobert that federal law required her to step down as acting director when the President nominated her as permanent director on November 10, 2015. According to the Inspector General’s letter, all of Ms. Cobert’s official actions since that date are null and void and cannot be ratified. The Post reports that

White House spokesman Frank Benenati said that Cobert was named acting director “consistent with the Federal Vacancies Reform Act. Since 1999, presidents of both parties have relied upon the consistent guidance and interpretation of that act by the Department of Justice governing when individuals may serve in an acting capacity while their nominations are pending before the Senate, and the Administration continues to rely upon that guidance. We firmly believe that Acting Director Cobert is acting within the confines of the law,” he said in an email.

The FEHBlog does not see this dispute going anywhere. It’s an oddity.

Yesterday, the Centers for Medicare and Medicaid Services announced that the agency in collaboration with health insurers and providers and the National Quality Forum has developed seven sets of quality standards which public and private payers will apply uniformly to providers.  “In the U.S. Health care system, where we are moving to measure and pay for quality, patients and care providers deserve a uniform approach to measure quality,” said CMS Acting Administrator Andy Slavitt. “This agreement today will reduce unnecessary burden for physicians and accelerate the country’s movement to better quality.”

The Healthcare Leadership Council announced six steps toward more effective, patient centric healthcare according to Fierce Healthcare report. Here are the first two which the FEHBlog certainly supports —

• Set a “firm date”–Dec. 31, 2018–to achieve health information interoperability everywhere in the U.S., with the private sector leading the way to help healthcare organizations share data. This parallels the goal set forth by the Medicare Access and CHIP Reauthorization Act (MACRA), the report notes.
• Implement reforms to improve the Food and Drug Administration, including easing administrative burdens imposed on the agency and taking steps to more quickly deliver innovative treatments and technologies to patients. 

The FEHBlog looks at Twitter in connection with sporting and political events. Consequently, when UConn was playing men’s basketball yesterday, he took a look at Twitter and there was the first report of Justice Scalia’s death. It took about 30 – 45 minutes (following the Texas Governor’s announcement) for the reports to appear in the AP, etc (understandably).  Very sad news.  Here’s a Politico link to various legal scholar’s viewpoints on this service on the Supreme Court.

Congress is not in town this week. Its sessions resume next week.

OPM posted about the cybersecurity aspects of the President’s budget.  OPM has not yet posted its budget justification to Congress. The next piece of the puzzle will be the Congressional Budget Office’s estimates of the costs and savings produced by the budget. That publication will be released in March. 

The Hill reports on the progress that is being made to shift the Medicare Part B reimbursement system from a fee for service to a value basis. Congress has allowed five years to complete this process. However, 

While hospitals have been shifting toward alternative payment models
under the Affordable Care Act, it will be new for physicians. There
are some concerns that a five-year window is not enough time for the
national healthcare system to shift into a new delivery model. Some
groups are already calling for a delay of the rule.

Yes, Abraham Lincoln was born today in 1809. The FEHBlog recently watched an interesting PBS documentary on the last President to have grown up in a log cabin, James Garfield. How many Presidents other than Lincoln, William Henry Harrison, and Garfield grew up in a log cabin?

On the good news front, Drug Channels reports that the Food and Drug Administration is working through its backlog of generic drug approval applications which means that manufacturers and wholesalers are losing pricing leverage. “The unprecedented generic inflation of 2013-2014 is fading.”

Modern Healthcare reports that

Embedded within President Barack Obama’s 2017 budget for HHS (PDF) is a provision to “eliminate surprise out-of-network healthcare charges for privately insured patients.” Details are scant, but the administration would try to solve the problem by requiring physicians who “regularly provide services in hospitals” to accept in-network rates, even if they aren’t in the insurer’s network. Hospitals would also have to “take reasonable steps” to ensure patients see in-network physicians.

This idea could attract bipartisan approval.

The IRS provides some guidance / “Tax Tips” on the array of new ACA-related tax forms that taxpayers will be receiving this calendar quarter. Worth sharing.

Modern Medicine reports on the five forces driving the expansion of telemedicine in 2016.  “The global telemedicine market is expected to expand at a compound annual growth rate of 14.3% over the next five years, eventually reaching $36.2 billion, compared to $14.3 billion in 2014.” Whoa nelly!

On the puzzling front, the Wall Street Journal reports that “The healthier you are, the more money you need to save for health care in retirement.”  The underlying reason is that healthier people incur more health expenses because they live longer lives. Nevertheless, it’s an interesting story.

Finally on the bad news front, Healthcare Dive reports why achieving interoperability in electronic medical records is a stretch goal. It certainly frosts the FEHBlog’s cake that HHS did not build interoperability into its EMR standards when it started throwing around $31 billion in funding.

The Senate Homeland Security and Governmental Affairs Committee took the following action at a business meeting this morning:

Nomination of Hon. Beth F. Cobert to be Director, Office of Personnel Management
Results: Ordered reported favorably by voice vote.
Senators present: Johnson, McCain, Portman, Paul, Lankford, Ayotte, Ernst, Sasse, Carper, McCaskill, Tester, Baldwin, Heitkamp, Booker, and Peters.

Now the nomination moves to the Senate floor assuming that Sen. Vitter removes his block. More details on the business meeting can be found in this Federal News Radio article.

Federal News Radio provides a comprehensive overview of the President’s budget proposals affecting federal employment. While the President’s budget as a whole is a dead letter, some of his ideas will be picked up in appropriations bills over the course of the year. Time will identify which ones.

Reuters reports that Aetna and Cigna each reach pay for performance deals with the drug maker Novartis for its new heart drug Entresto. Bloomberg provides more details on the deals which give us hope for a new trend.

The Labor Department issued a hefty report to Congress concerning health plan compliance with the federal mental health parity law. “This report includes examples of situations where EBSA was able to intervene on behalf of participants and ensure that participants received coverage for the healthcare they needed. These results will no doubt be replicated and built upon in coming years as the agency continues to identify, respond to, and correct MHPAEA violations and minimize the opportunity for future violations through effective outreach and regulation.”

The President released his FY 2017 budget today. The House and Senate budget committee chairs are not even asking the OMB Director to present the budget at formal hearings per NBC News. Here’s a link to OPM’s press release on its FY 2017 budget proposal. These are OPM’s legislative proposals for our beloved FEHBP:

The President’s 2017 Budget proposes five changes to modernize and strengthen the Federal Employees Health Benefits Program (FEHBP): 1) Streamline pharmacy benefit contracting to allow the Office of Personnel Management (OPM) to contract separately for pharmaceutical benefits; 2) Allow OPM to enter into contracts with a greater variety of health plan types; 3) Permit OPM to adjust plan premiums based on wellness program participation and tobacco use; 4) Extend temporary health benefit coverage to infants born to dependent daughters of FEHBP participants for 30 days; and 5) add FEHBP to the list of Federal Health Programs in the Anti- Kickback statute. If enacted and implemented, these changes could be reflected in carrier contracts issued for 2018.

Proposals 1), 3) and 5) have been offered for three or four years in a row without Congressional action. These proposals, if enacted, would unnecessarily disrupt a program that is working.  For example, the FEHBlog has explained time and again (with links to studies) that separating prescription coverage from medical coverage raises premiums by denying plans the opportunity to coordinate care. If it were such a great idea, why didn’t Congress take that approach with the Affordable Care Act plans? TRICARE is structured with separate medical and prescription drug coverage but reformers are urging that TRICARE be restructured to look like the FEHBP.  Leave well enough alone.

The FEHBlog will post OPM’s budget justification to Congress when it becomes available.

Both Houses of Congress are in session this coming week. The President is expected to release his final budget on Tuesday.  The President is expected to propose a 1.6% raise for federal employees and military personnel in 2017 according to Reuters. He also is expected to propose a tweak or two the 40% excise tax on high cost employer sponsored plans. The FEHBlog sides with the critics who believe that the tax should be repealed.

Mike Causey on Federal News Radio reminds us that the limited open enrollment period that allows federal employees to switch from self and family and self plus one coverage is ongoing. The period ends on February 29. Annuitants can drop down at any time because unlike employees annuitants pay their premiums wiht after tax income.

Healthcare Payers News reports that “twenty major companies, including American Express, Verizon, Coca-Cola and HCA have joined the newly-launched Health Transformation Alliance to combine data on the population health of their employees, and potentially flex their muscle with insurance companies and big pharma, according to Tevi Troy, president of the American Health Policy Institute.”  Good luck with that, and go Broncos.

OPM reminds us that today is dedicated to efforts to improve heart health. The FEHBlog had no idea.

Yesterday, OPM acting director Beth Cobert had her confirmation hearing before the Senate Homeland Security and Governmental Affairs Committee. Everyone on the Committee and the FEHBlog agrees that Ms. Cobert is well qualified for this position. Nevertheless, the Federal Times explains that there are five issues hounding her nomination to serve as permanent OPM direction. The FEHBP is not one of them.

Also the House Government Reform and Oversight Committee held a hearing on prescription drug pricing. Health Data Management offers this interesting perspective on the causes of rising prescription drug spending.  The article identifies electronic prescription devices, which Congress mandated, as one cause.

In other legislative news  –

• The Hill suggests that Sen. Tom Carper’s Postal reform bill called iPOST may get enacted this year. The bill would create a Postal Service Health Program within the FEHBP.  
• Healthcare Dive reports on a bipartisan bill to expand coverage of everyone’s darling, telehealth. 
• The Week in Congress provides its look back on this week’s activities on Capitol Hill. 

Tomorrow at 10 am the Senate Homeland Security and Governmental Affairs Committee will hold a hearing on the President’s nomination of Beth Cobert to serve as permanent OPM Director. Ms. Cobert currently is the acting Director.  Roll Call is reporting that Sen. David Vitter (R MI) may exercise his privilege to place a hold on Ms. Cobert’s nomination until the agency furnishes him requested information about the OPM rule permitting members of Congress and their staffs to enroll for DC SHOP coverage with a government contribution.

Federal News Radio reports that yesterday OPM’s long standing Inspector General Patrick McFarland announced his retirement as of February 19.  His deputy Norbert Vint will serve as acting OPM Inspector General after that date.  Inspector Generals are nominated by the President.

Yesterday as the Hill reports the House of Representatives was unable to achieve the 2/3s majority vote required to override the President’s veto of the reconciliation measure repealing key parts of the ACA.  Repeal now becomes an issue for the Presidential election.

On the health care cost front, the Altarum Institute released its monthly health care sector report for January 2016

Health care prices grew by 1.1% in 2015, the slowest annual rate ever in our historical series going back to 1990
• The historically low 1.1% growth in health care prices in 2015 was heavily influenced by physician prices, which actually fell by 1%; and more generally by economy-wide inflation, which, at 1.0% in 2015 (as measured by the gross domestic product deflator), barely exceeds the 0.8% rate seen in 2009, the last year of the recession.
• Prescription drug prices grew by 4.6% overall in 2015, but the rate of growth declined over the course of the year, from a peak of 5.5% in Q1 to a low of 3.2% in Q4 2015.

As part of the FEHBlog’s ongoing efforts to place the Zika virus in perspective, here’s a link to an article about the particular mosquito which spreads the virus as well as Yellow Fever and dengue fever. It’s a bad mammer jammer. Just don’t leave any standing water if you live along the Eastern Seaboard (up to NYC or so).