We have reached the end of 2015.  Last week, I provided a list of FEHBP-related surprises in 2015. I should have added to the list the smooth implementation of the ICD-10 coding set. That was another heavy lift for the health care industry. The FEHBlog hopes that the more granular ICD-10 codes pay off for the data miners.

The House of Representatives will be back in session on Capitol Hill next Monday while the Senate will return on January 11.  The FEHBlog would not be surprised if Congress tackles the prescription drug cost problem in 2016.  The problem with specialty drugs is illustrated by this Wall Street Journal article. The Washington Post reminds us that most people (like the FEHBlog) use low cost generic drugs.

ProPublica and NPR seek to bring the hammer down on repeat healthcare privacy offenders. These advocates wants the government to crack down on repeat offenders, but as the FEHBlog has explained there is a significant expense associated with remedying data breaches, regardless of whether the HHS Office for Civil Rights gets involved. More details can be found in this Ponemon Institute report.  

Happy New Year.

• Yesterday the IRS miraculously extended for two months the deadlines for furnishing and filing the forms that document compliance with the Affordable Care Act’s individual and employer shared responsibility mandates.  The Affordable Care Act requires health plans and insurers to report on coverage for their members/insureds and large employers to report on whether or not they offered their full time employees minimum essential coverage.  The Internal Revenue Service will use this information to enforce the ACA’s individual and employer shared responsibility mandates.  The delay does not affect the ability of taxpayers to file their 2015 tax returns.  Indeed the individual shared responsibility mandate was in effect for 2014 but the IRS delayed the associated reporting requirement until this year. So everyone successfully filed their 2014 tax returns without these reports known as the Form 1095-B. 
• The Wall Street Journal reported today that beginning with the new year the Centers for Medicare and Medicaid Services can fine insurers for defective provider directories.  For the life of the FEHBlog, he cannot understand why CMS cannot simply direct doctors to identify for their patients the networks to which they belong.  Why do all of the burdens have to be placed on the insurance companies? What happened to two way streets? 
• Another burr in the FEHBlog’s saddle is the fact that taxpayers spent $30 BILLION dollars on electronic medical record systems that don’t communicate with other health systems and insurers, even though the last Administration was advocating interoperability.  Better late than never, the HHS electronic health records czar last week “released its 2016 Interoperability Standards Advisory, providing the healthcare industry with a list of what ONC calls the “best available” standards and implementation specifications to fulfill specific clinical health IT interoperability needs,” according to Health Data Management.  
• Finally, Modern Healthcare reports

ACA critic Douglas Holtz-Eakin, a former director of the Congressional Budget Office who now heads the conservative American Action Forum, said the healthcare reform law is “riddled with some of the worst tax policy I’ve ever seen.” In his view, the projections of how much revenue its tax provisions would raise never added up.  

Still, he said Congress’ bipartisan move to freeze the three ACA taxes—with the likelihood that they never will be restored—is a blow to the law, said Holtz-Eakin, who advised Sen. John McCain on healthcare policy during McCain’s 2008 presidential campaign.  

He said the Cadillac tax was intended to push employers to pare back on gold-plated health benefit plans. The Obama administration and congressional Democrats designed it in a way that differentiated the tax from McCain’s proposal to cap the tax exclusion for employer plans, which candidate Barack Obama had sharply criticized. Now, Congress should again consider capping the tax exclusion, which could receive bipartisan support, Holtz-Eakin said.

Here’s hoping. As the FEHBlog has pointed out, small business people already have a capped exclusion and people purchasing individual coverage have no exclusion (but may have tax credits).  

Psychiatric drugs are now being given to infants and toddlers in unprecedented numbers. 

An analysis of 2013 IMS Data, found that over 274,000 infants (0-1 year olds) and some 370,000 toddlers (1-3 years age) in the U.S. were on antianxiety (e.g. Xanax) and antidepressant (e.g. Prozac) drugs. This report also found over 1,400 infants were on ADHD drugs. 

A 2014 Georgia Medicaid analyses led by Susanna Visser at the CDC (see a video of her fascinating talk) when extrapolated nationwide by the New York Times found that over 10,000 toddlers were put on ADHD treatments. (Dr. Visser is currently working on national estimates but believes that the estimate from the Georgia data is conservative.)
Prescriptions of powerful antipsychotics such as Risperdal for infants and very young children have also sharply risen. 

At least the expert concludes that this trend is misguided. How can doctors prescribe these drugs to little children whose brains are developing?   As the expert, a psychiatrist, concludes, “This is a complex problem but as the social reformer Frederick Douglass noted over a hundred years ago, “It’s easier to build strong children than to repair broken men.” Healers heal thyself.

Researchers studying brain tumors said they have discovered a new biological mechanism that causes normal cells to become cancer cells, a finding that both challenges current treatment strategies and could lead to new approaches against the disease. * * *  

[The discovery] underscores cancer’s complexity. The process appears to operate independently of the so-called driver mutations that fuel cancer. The finding may help explain why treating tumors with drugs targeted at such mutations—a strategy known as precision medicine—is having limited success. While such targeted treatment often dramatically shrinks tumors initially, in most cases, patients eventually relapse.

From the FEHBlog’s standpoint  —

• Aggressive Chinese hackers create havoc for OPM, several FEHBP carriers, and FEHBP enrollees / federal employees.  
• Congress delays the Affordable Care Act’s 40% excise tax on high cost employer sponsored plans (a/k/a the Cadillac tax) for two years and suspends the onerous health insurer tax for 2017 on a bipartisan vote spurred by the legislators who helped rammed through the law in 2010.
• The Self plus one enrollment falls flat despite OPM and carrier communication efforts.   

It’s Christmas Eve.  Here’s a link to the acting OPM Director’s Happy Holiday’s blog post.

It turns out that the Federal Times article about Open Season actions that the FEHBlog mentioned earlier this week was prompted by an OPM press release.  Dear Federal Times, Govexec.com, and Federal News Radio, Open Season activity did not prompt OPM to hold a special Open Season early next year to allow employees to switch to self plus one.  The agency announced its plans to do last Spring. Also annuitants always can drop down an enrollment level. The news in the OPM press release was the relatively low level of Open Season transactions considering the fact that about 1 million enrollees were eligible to make the switch to self plus one. Perhaps word of mouth next month will encourage more people to switch.

Modern Healthcare reports on understandable insurer outrage about HHS’s proposed 2017 ACA notice of benefit payment parameters. The insurers are upset about HHS mandated changes to the rules governing the health insurance exchanges. While these proposed rules are not applicable to the FEHBP, the FEHBlog agrees that HHS needs to back off here.  Insurers inside and outside the exchanges are being strangled by regulations and sub-regulatory guidance which basically serve to raise premiums. The FEHBlog’s Christmas wish is regulatory calm for 2016. Merry Christmas everyone.  

The Federal Times reports this evening that “Open season for federal employees to enroll in or change their health insurance closed on Dec. 14, and OPM has projected that 600,000 FEHB enrollment transactions were processed.  The figure surpasses 2014’s mark of more than 430,000 transactions processed and was aided by the inclusion of the new Self Plus One policy for smaller households, officials said.”  Last Spring, OPM had indicated that as many as 1,000,000 enrollees were eligible to drop down to self plus one.

The American Enterprise Institute posted a thought provoking legislative alternative to the Affordable Care Act yesterday.  For example (p. 20),

The [Cadillac] tax will be assessed in 2018 [now 2020] on plans with individual premiums in excess of $10,200 and family premiums in excess of $27,500. These thresholds are set to increase with inflation. Employers pay the same tax, regardless of the income of the worker. Given that there is an economic trade-off between wages and benefits, the Cadillac tax disproportionately harms lower-income workers with generous health benefit plans. Thus, while the Cadillac tax imposes some level of cost discipline into employer-sponsored coverage, it does so in a poor manner. The better approach is to retain the discipline created by the Cadillac tax but without the painful side effects of a new excise tax. One such approach is to place an upper limit on the amount of employer-paid premiums that is tax-free to workers. 

The Centers for Medicare and Medicaid Services announced yesterday the creation of “a new online dashboard to provide information on Medicare spending on prescription drugs, for both Part B (drugs administered in doctors’ offices and other outpatient settings) and Part D (drugs patients administer themselves).”  In other drug news, the Wall Street Journal reported on Saturday about aggressive employer efforts to pave the way for effective use of high priced specialty drugs. For example,

At the University of Minnesota, employees with cancer face a new rule under the health plan. If they are starting on certain expensive drugs, they get just a two-week supply, half the usual amount. Before they can get two more weeks’ worth, a nurse at the university’s pharmacy partner has to confirm they are doing well enough.

The policy, called “split fill,” is designed to avoid paying for drug prescriptions that go half-unused if patients develop side effects and must stop them. It is part of a growing effort to rein in a drug bill the university says rose 8.9% last year, roughly double the rate for other health expenses.

“I don’t want to penalize the patients, but what the drug companies have to realize is they put us in that box” by charging such high prices, said Stephen Schondelmeyer, a pharmacy professor who advises the administration on its benefits for nearly 39,000 employees, retirees and family members. Some of the cancer drugs cost as much as $13,500 a month.

The FEHBlog certainly is not encouraging clients to tear a page out of the University of Minnesota playbook. The article does illustrate the depth of employer concerns.

Also while it’s a downer for the holiday season, Reuters reports on a spike in deaths from opioid and heroin abuse.  “Drug overdoses increased 6.5 percent in 2014 from a year earlier, killing 47,055 people. The highest rates of death from overdose were seen in West Virginia, New Mexico, New Hampshire, Kentucky, and Ohio, the CDC report said.”

Finally, Modern Healthcare and Ihealthbeat report on healthcare industry cybersecurity measures that were included in the recently approved omnibus appropriations measure.

The legislation creates a healthcare industry cybersecurity task force to be established within the law’s first 90 days. The task force will study how other industries combat cyber threats as well as the technical and other challenges that make the healthcare industry vulnerable to attacks.

It also calls for a single pipeline of actionable information on cyber threats that could be accessed in real-time and at no cost. Access to that information is currently cost-prohibitive to small and mid-size healthcare organizations, said Samantha Burch, HIMSS’ senior director of congressional affairs.

That’s welcome news. Jingle bells.

Congress has headed home for the holidays. The federal legislature will return to the Nation’s Capital to resume its session on January 11, 2016. Here is a link to the Week in Congress’s report on last week’s actions on Capitol Hill.

The President before leaving for Hawaii signed the tax extenders and omnibus appropriations bills into law.  The AP provides an interesting report on the politics of the helpful Affordable Care Act changes wrought by this law.

The President also signed an executive order giving federal employees a 1.3% raise for 2016 per Federal News Radio. “Specifically, I have determined that for 2016, across-the-board pay increases will be 1.0 percent,” [the President] wrote [to Congress]. “Also, I will make a decision by November 30, 2015, regarding an alternative plan for locality payments under 5 U.S.C. 5304a. The alternative plan for locality payments will be limited so that the total combined cost of the 1.0 percent across-the-board base pay increase and the varying locality pay increases will be 1.3 percent of basic payroll, consistent with the assumption in my 2016 Budget.”

Modern Healthcare reports not suprisingly that “Commercial health plans that cover workplace benefits for millions of Americans pay higher prices to hospitals that have little or no competition, according to a new study that raises questions about how to slow U.S. health spending amid a wave of consolidation.”  The hospitals argue that the ACA incents the health system integration.