• Senate Finance Committe Chairman Sen. Max Baucus (D Mont.) released his health care reform plan blueprint today. The Baucus plan is similar to the current Massachusetts connector system which requires individuals to purchase health insurance, a so-called individual mandate. President elect Obama’s plan involves mandatory coverage of children, an employer play or pay mandate, similar to that in San Francisco, and expanded coverage of adults though a national health insurance exchange. Neither plan evidently would affect the FEHBP directly. However, there is the Medicare for All approach exemplified by H.R. 676 that would scrap all employer sponsored coverage, including the FEHBP: “SEC. 104. PROHIBITION AGAINST DUPLICATING COVERAGE. (a) IN GENERAL.—It is unlawful for a private health insurer to sell health insurance coverage that duplicates the benefits provided under this Act.”
• Business Insurance reports on a PriceWaterhouseCoopers study of the projected cost of the President elect’s plan. “’Obama’s proposal is likely to increase revenues but lower margins for providers, pharmaceutical companies and health plans that increasingly depend on government payment,’” the report said.”
• Speaking of transitions, Govexec.com reports on the top vacancies at OPM that the new President will be filling and Government Health IT reports on AHIC Successor Inc.’s operational approach, which involved value cases.
• CMS has selected four companies — Google Health, HealthTrio, NoMoreClipboard.com, and PassportMD — for a pilot personal health record (“PHR”) program under which traditional Medicare beneficiaries in Arizona and Utah can choose one of the selected PHR companies to maintain their health record information electronically.
• Indystar.com reports that Wellpoint, in cooperation with a self funded employer sponsored health plan, is “testing the concept of arranging and paying for you and a companion to travel to India for a joint-replacement procedure that could cost a fraction of what it would at your local hospital.”
• Bloomberg.com reports on a drug study funded by the prescription benefit manager Medco Health Solutions. According to Medco’s press release,
  

  In the largest study of its kind to date, researchers at Medco report that [proton pump inhibitors] PPIs [such as Nexium] inhibit the effectiveness of clopidogrel, the number two prescription drug in the world, thus increasing the risk of a major cardiac event, such as heart attacks and strokes by 50 percent. Since PPIs mimic the effect of a variant gene, which also renders clopidogrel ineffective, this study further suggests a potential role for genetic testing. “Considering the widespread use of these two medications, this important research adds to a growing body of evidence raising questions about their concurrent use and suggests further research is needed,” said Dr. Robert Epstein, a lead study author, chief medical officer, Medco. “With this research in hand, we intend to open a dialogue with the major clinical organizations to advance the discussion around the guidelines that govern the use of Plavix.”

• The American Medical Association is developing a health insurer code of conduct. According to the AMA’s press release — issued in the middle of Heal the Claim month — “ninety-two percent (92%) of physicians polled said that insurance company incentives and disincentives regarding treatment protocols may not be in the best interest of the patients.”” But then again may be they are, and doctors are not refusing the insurers’ Benjamins.

Happy Veterans Day! 90 years ago today the guns fell silent on the Western Front. Thanks to everyone who has served in our Nation’s military services.

• AIS offers the perspective of various FEHBP carriers on the current Open Season. AIS also provides various viewpoints on how consumer driven health care will fare in the next Administration.
• The Justice Department reported on False Claims Act recoveries during the government fiscal year that ended on September 30, 2007.
• The Midwest Business Group on Health released its 2008 National Benchmarking Survey of Employers and Regional Focus Groups of Employees and their respective Readiness to adopt Value-based Benefits Strategies. Not surprisingly to me at least, the Group found that “The premise of value-based benefit design programs for health care – higher quality care at a lower cost – is counterintuitive to employees’ perception of the consumer marketplace. Employees perceive higher quality health care equals higher cost.” The Group recommends more employee education.
• The Wall Street Journal featured today an article on the impending ICD-10 code set conversion. The ICD provides the codes that all providers use to classify providers diagnoses and that hospitals use to classify the care that they provide to patients. (Doctors use the AMA’s CPT). “The new system of 155,000 codes includes 68,000 codes describing diagnoses, up from 13,000 currently, and 87,000 codes for different medical procedures, compared with 3,000 in the current system.” The Journal summarizes the pros and cons as follows:
  

  The new codes can offer more detail on patients’ conditions.

  Doctors complain that changing to the new system will eat up time and money.

  Hospitals could get higher payments for performing more-advanced surgeries.

  Consumers may see more billing errors as the new system rolls out.

  Actually everyone agrees on the need to convert, the disagreement is over the length of time necessary for a smooth conversion. Hopefully, cooler heads will prevail, and HHS will set October 1, 2013 as the conversion date.

• The Federal Benefits Open Season begins tomorrow, November 10, and continues through December 8.
• The American Health Information Community (AHIC) holds its final meeting on November 12. AHIC Successor, Inc., “the public-private partnership created to improve the quality of American healthcare through the adoption of interoperable information technology standards,” will hold its inaugural Board of Directors meeting on Thursday, November 13, 2008. AHIC Successor has posted for public comment a report titled “A Process for Establishing Nationwide Health Information Technology Priorities.” Comments are due by November 11.
• The prescription benefits manager Express Scripts announced last week that
  

  it has received a letter from an unknown person or persons trying to extort money from the company by threatening to expose millions of the company’s patients’ records. The letter included personal information of 75 members, including their names, dates of birth, social security numbers, and in some cases, their prescription information. The company said it has notified the affected members. It also immediately notified the FBI, which is investigating the crime. The company also said that it is conducting its own investigation with the help of outside experts in data security and computer forensics. The letter arrived in early October. “We have been conducting a thorough investigation since we received this threat and we are taking it very seriously,” said George Paz, chairman and chief executive officer. “We are cooperating with the FBI and are committed to doing what we can to protect our members’ personal information and to track down the person or persons responsible for this criminal act.”

• According to the Wall Street Journal’s Health Blog, prescription benefit manager Medco’s CEO David Snow predicted last week, following the election, that Congress is likely to enact next year a bill that will create a generic pathway for specialty or biotech drugs. That is good news.
• Speaking of PBM’s, Drug Benefits News reports that “A new pharmacy benefit pilot program involving Caterpillar Inc. and Wal-Mart Stores, Inc. cuts “significant waste” out of the pharmaceutical supply chain and scraps the long-maligned average wholesale price (AWP) discount methodology in favor of an Rx cost-plus model, say those involved in the program. Both Caterpillar and Wal-Mart tell DBN that the program is attracting the attention of other large employers, and has the potential to change the rules of the game of the pharmacy benefit industry.”
• Finally, the New York Times reported last week that Washington University scientists successfully decoded the genome of a woman suffering from leukemia.
  

  This is the first of many of these whole cancer genomes to be sequenced,” said Richard K. Wilson, director of Washington University’s Genome Sequencing Center and the senior author of the study. “They’ll give us a whole bunch of clues about what’s going on in the DNA when cancer starts to bloom.” Dr. Wilson said he hoped that in 5 to 20 years, DNA sequencing for cancer patients would consist of dropping a spot of blood onto a chip that slides into a desktop computer and getting back a report that suggests which drugs will work best for each person.“That’s personalized genomics, personalized medicine in a box,” he said. “It’s holy grail sort of stuff, but I think it’s not out of the realm of possibility.”

• The Federal Times reports that
  

  President-elect Barack Obama said he will expand family leave, flexible work schedule and teleworking benefits to federal employees; roll back controversial pay-for-performance systems; review current outsourcing policies; and give collective-bargaining rights to Transportation Security Administration employees.

  In a series of late-October letters to John Gage, the national president of the American Federation of Government Employees, Obama sounded off on numerous issues and policies. The union released the letters today {November 5].

  Copies of the letters accompany the online article.

• Govexec.com reports that “Federal employee advocates are optimistic that Democrats’ gains in Tuesday’s election will give them a wide opening to repeal Defense Department pay reforms and advance benefits legislation.” On the FEHBP front, Govexec.com says that
  

  Employee groups plan to lobby for legislation that would increase the government’s share of health insurance premiums and for a federal contribution to dental and vision plans. A bill introduced in early 2007 by House Majority Leader Steny Hoyer, D-Md., would have increased the portion of premiums covered by the government from 72 percent to 80 percent, thus reducing the burden on Federal Employees Health Benefits Program enrollees, whose premiums will rise an average of 7 percent in 2009. Beth Moten, legislative director for AFGE, said on Thursday that unions also would push for an overhaul of FEHBP, a program she argues has been run poorly by the Office of Personnel Management. Allowing 9 million current and retired federal employees to enroll in any of 250 plans dilutes their bargaining power with insurance companies, she said. “The national health insurance issue will take priority, so we’re trying to figure out how to dovetail with that,” Moten said. One proposal advanced during the campaign was to set up a program similar to FEHBP for the uninsured. “If they use FEHBP as a parallel program or model, we need to make sure our people are being treated right,” Moten said.

  The FEHB Program was founded almost fifty years ago on the principle of competition among health plans. It has operated successfully ever since. Ms. Moten’s suggestion for “overhauling the FEHB Program” in my view is bad policy.

U.S. News and World Report has published its HMO rankings (commercial, Medicare, and Medicaid) which is based on NCQA data. Harvard Pilgrim Health Care is number 1. 

Ron Davis, MD, immediate past president of the American Medical Association, died yesterday. I was impressed by his courage in carrying out the responsibilities of his office while undergoing treatment for pancreatic cancer.  He educated the public about his treatment through the Carepages website.  He was clearly a man of character. 

As far as I can recall FEHB plan brochures generally have defined a covered hospital as one accredited by JCAHO (“the Joint Commission”).  Until recently, the Joint Commission was the only CMS approved vendor that could accredit hospitals for Medicare participation. The AMA News reports that CMS in May 2008 approved a second vendor, DNV Healthcare.  DNV’s program is known as NIAHO.  What’s more, on October 24, CMS placed one of the Joint Commission’s programs on probation, which the Joint Commission must resolve by May 2009.