If the FEHBlog had a Drudge like siren, he would use it here. According to FedScoop, the White House announced that “The Trump administration designated [OPM Deputy Director] Margaret Weichert to take the helm of the Office of Personnel Management as acting director, replacing Jeff Pon after just seven months.” Ms. Weichert will bold both positions for the near future. The Washington Post adds that “people close to Pon said he was at odds with the administration over its planned revamp of the personnel agency, which would have diminished his role and authority.”

Medpage reports that the Senate today easily passed the bipartisan opioid crisis response bill (H.R. 6)  thereby sending bill to the President to be signed into law.

Some of the provisions in the bill, which the House passed last week, include:

• Giving Medicare beneficiaries more information on alternative pain treatments, and expanding treatment options for enrollees who are addicted to opioids, while expanding treatment options for opioid-addicted beneficiaries.
• Partially repealing the the Medicaid Institutions for Mental Diseases (IMD) exclusion, which will allow state Medicaid programs to cover inpatient treatment in residential facilities.
• Allowing mothers undergoing addiction treatment to have their young children stay with them, and increasing accessibility of family residential treatment programs, which allows more parents to get help while still caring for their children in a supervised setting.
• Requiring state Medicaid programs to have safety edits in place for opioid refills, to monitor concurrent prescribing of opioids and certain other drugs, and to monitor antipsychotic prescribing for children.
• Directing the Centers for Medicare & Medicaid Services to issue guidance to states on options for providing services via telehealth that address substance use disorders under Medicaid.
• Accelerating the development and use of drug management programs for at-risk beneficiaries within the Medicare program by mandating that all prescription drug plans use such a program by 2022.
• Requiring FDA to develop evidence-based opioid analgesic prescribing guidelines for the indication-specific treatment of acute pain.

Readers may have noticed that according to press reports, that the average government contribution toward FEHBP coverage increased by 1.2% for 2019. The FEHBlog noted yesterday that the maximum government contribution increased by 0.3% for self plus one coverage and 0.7% for self and family coverage. The increase for self only coverage was 0.4%. So the maximum government contribution increase was under 1%. How then is the government contribution increasing by 1.2%? The government contribution toward FEHB coverage is 72% of the enrollment weighted average capped at 75% of the selected plan’s premium. Consequently, if a plan’s premium is below the maximum government contribution (and many are), the federal government picks up 75% of the any increase in the premium of an under the max plan. Those under the max plan increases account for the average 1.2% increase in the government contribution.

Yesterday, the U.S. Government Accounting Office released a report on postal retiree health benefits. The office’s conclusion is as follows:

About 500,000 postal retirees receive retiree health benefits. The Postal Service Retiree Health Benefits Fund pays most of the costs. 

The Postal Service has not made $38.2 billion in required payments to this fund through fiscal year 2017. If it makes no more payments, the Office of Personnel Management projects the fund will be depleted in fiscal year 2030. 

We highlighted several approaches to address this shortfall, such as requiring most eligible retirees to participate in Medicare, increasing cost-sharing, or reducing benefits. 

Congress should consider legislation to put postal retiree health benefits on a more sustainable footing.

Congress had been considering such legislation until the President decided to create his own Postal System Reform Task Force last April. The Task Force report was timely delivered to Congress in early August. Hopefully the President will get the reform ball rolling again in time for the lame duck session of Congress in November.

Mergers and acquisitions tidbits:

• United Healthcare, according to Bloomberg, acquired Genoa Healthcare, a large chain of pharmacies that operate out of mental health and substance use disorder facilities.  
• Healthcare Dive reports that the two largest health systems in Texas — Dallas based Baylor Scott and White on the one hand and Houston based Memorial Hermann Health System on the other — have a sign a letter of intent to merger their companies. ”  Combined, the two would operate 68 hospitals, two health plans and more than 14,000 affiliated physicians” in the Lone Star State. 

If you find yourself scratching your head about the small gap between self plus one and self and family premiums in the FEHBP, please bear in mind that before Congress added the self plus one option self and family premiums were only 2.3 to 2.4 times self only premiums on average. Because of its older demographics, FEHB family sizes have been and remain relatively small. In other words, there really was no need to create the self plus one option (an OPM actuary told me that in 2009), the self plus one choice is there.

Also remember that the full premiums for self and family always are larger than the full premiums for self plus one. However, because OPM calculates the government contribution using a method required by law (enrollment weighted average), the larger government contribution for self and family may cause the enrollee contribution for self and family to be somewhat less than the employee contribution for self plus one for the same plan and same option.

For 2018 the government contribution for self and family increased by 0.7% (seven tenths of one percent) while the government contribution for self plus one increased by 0.3% (three tenths of one percent). This outcome unfortunately compounds the “flip flop” problem. If you did not face this problem for 2018, please check your plan’s 2019 premiums. If you do face this problem for 2019, simply change to self and family during Open Season.

Today is the the last day of the 2018 federal fiscal year and the federal government will be operating on a regular schedule.  Tomorrow is the first day of the U.S. Supreme Court’s October 2019 term. No FEHBA issues currently are pending before that Court.

The House of Representatives completed its pre-midterm election work last week and hit the campaign trail. Specifically, the House joined the Senate in approving the Defense/HHS etc. minibus appropriations bill. That bill which the President signed also provides for continuing appropriations through December 7 for  operations like the FEHBP without enacted FY 2019 appropriations. Here are links to the Federal News Radio bills on the second enacted minibus and the pending final minibus which will address whether federal employees will receive a pay raise next year.

The House also passed by a 393-8 vote the conference report on the opioid crisis response bill (H.R. 6, H. Res. 1099). Here is a link to the American Hospital Association’s site on the conference report.

Countable reports that the Senate will be continuing its work this coming week. Of note is the fact that the Senate plans to consider and approve the opioid crisis response bill this week. A favorable Senate vote would send the bill to the President to be signed into law.

In this regard, here’s a link to an interesting Opioid Institute article on using blockchain technology to help remedy the opioid crisis. On last Monday’s Econtalk podcast, the interviewer Russ Roberts spoke with Rodney Brooks, the Panasonic Professor of Robotics (emeritus) at MIT. Professors Roberts and Brooks discussed among other things Amara’s Law:

Roy Amara was a cofounder of the Institute for the Future, in Palo Alto, the intellectual heart of Silicon Valley. He is best known for his adage now referred to as Amara’s Law:

We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.

The discussion covered technology examples such as GPS (long run stage) and driverless cars (short run stage). Blockchain probably falls into the short term category too.

On the mergers and acquisition front last week, Cigna announced its combined Cigna / Express Scripts executive team and according to Healthcare Dive, Aetna sold its entire Medicare Part D business to Wellcare.

The deal — meant to grease the wheels for approval of the pending CVS-Aetna deal — does not affect individual or group Medicare Advantage plans or Medicare supplement plans or products Aetna said the purchase price of its Medicare Part D business is not material. Aetna’s standalone Medicare Part D members will continue to be covered by Aetna through the rest of the year. The deal is expected to close Dec. 31.

Both deals are expected to close later this year.

The Centers for Medicare and Medicaid Services announced late last week that

On average, Medicare Advantage premiums will decline while plan choices and new benefits increase. In addition, Medicare Advantage enrollment is projected to reach a new all-time high with more than 36 percent of Medicare beneficiaries projected to be enrolled in Medicare Advantage in 2019. This news comes as the agency releases the benefit and premium information for Medicare health and drug plans for the 2019 calendar year.  

The Medicare Advantage open enrollment season runs from October 15 through December 7, 2018.

OPM has posted Wednesday’s press release about 2019 FEHBP and FEDVIP premiums on its website. At the bottom of that press release, you will find links to 2019 premium charts. As a short cut for readers, here’s the links to the FEHBP premiums.

Today, OPM announced the 2019 FEHBP and FEDVIP premium changes which waves the green flag for FEHBP and FEDVIP plans to start communicating about their 2019 benefits and premiums initially on their websites. According to this comprehensive Washington Post story, the average FEHBP enrollee contribution increase is a mere 1.5%, the lowest increase in over 20 years. The government contribution increase is 1.2%. OPM will have it online FEHBP comparison tool ready for 2019 as we get closer to the start of Open Season on November 12, 2018.

Modern Healthcare reports that the Congressional conference committee finished its work on the opioid crisis remedial legislation (H.R. 6) yesterday evening. Of note, the final bill does not include a pharmaceutical manufacturers proposal to partially restore the Medicare Part D donut hole (good outcome) or a healthcare industry proposal to align the unnecessarily complicated substance use disorder privacy law (42 CFR Part 2) with the generally applicable HIPAA Privacy Rule (mystifying outcome).

Healthcare Dive informs us about CVS Health’s plans for its acquisition of Aetna.  For example,

Executives described how they could use its existing services to better serve Aetna’s members. As soon as the deal closes, if it does, CVS believes it will have immediate access to 20% of Aetna’s membership currently using the stores. That matters because CVS believes its pharmacists play a crucial role in shaping a patient’s overall behavior. CVS said many investors underestimate the role of the pharmacist. 

The new, cheaper versions of Gilead’s Epclusa and Harvoni will cost $24,000 for a course of treatment, the Foster City, California-based company said in a statement on Monday. When Harvoni came on the market in 2014, Gilead set a list price of $94,500. Epclusa was approved for sale in 2016, with a price of $74,760.

As the FEHBlog has previously noted, while the original list prices were stunning, curative drugs are taken for a relatively short time frame. Typical blockbuster drugs like statins are taken for years and years. Hopefully more curative drugs for potentially fatal illnesses were be forthcoming and in the meantime the market can figure out a Goldilocks solution.  Easier said than done.  But for now it’s good to see generic level pricing for these drugs.

Health Affairs offers an interesting analysis of the bipartisan surprise bill legislation recently circulated for comment by a group of Senators (as noted in a recent FEHBlog post).

This bipartisan draft legislation marks an important step forward in putting an end to surprise out-of-network medical bills nationwide. As work proceeds on this issue, lawmakers should focus on:

• Determining the appropriate payment rate from the health plan to the provider in these instances, specifically considering a lower rate than the 125 percent of average allowed amounts in a region currently in the draft (and if using any percentile of average allowed or contracted amounts, pegging this calculation to a point in time before passage of the bill, inflated forward);
• Narrowing the protection for all out-of-network services at an in-network facility to those most likely to involve surprise bills; and
• Adding a protection for out-of-network ambulance bills. 

This should be the week that OPM announces the 2019 government contribution toward FEHBP coverage and plans disclose that 2019 enrollee premiums and benefit changes. Woo hoo!

Congress also will be in session on Capitol Hill. Here’s a link to the Week in Congress’s report on last week’s actions on the Hill. The FEHBlog is ecstatic that he found a website that reports on the bills, etc., that Congress is expected to consider this coming week. The Hill newspaper used to have such a weekly report. Today the FEHBlog found it on the Countable website.

The Senate Health Education Labor and Pensions Committee will hold its fourth hearing on reducing health care costs this coming Thursday at 10 am. The subtopic will be improving affordability through innovation. The FEHBlog’s current preferred source for innovative ideas is the Health Payer Intelligence website.

Tomorrow, the U.S. Supreme Court will convene for its so-called super conference in anticipation of opening its October 2019 session next week. The orders from this conference will be released on Thursday.