The Office of Personnel Management (“OPM”) issued two FEHBP-related proposed rules this week.  The FEHBlog discusses the first proposed rule, which concerns extension of FEHB coverage while an employee is on leave without pay, in this Govexec.com article. In short, the proposed rule permits agencies to require LWOP employees to pay as they go for FEHBP coverage except in certain circumstance such as Family and Medical Leave or workers compensation. A friend of the FEHBlog pointed out to him that “The USPS has had a process in place for many years that automatically bills for the employee share of FEHB premiums after an employee has been in LWOP for six pay periods [/ twelve weeks].” That’s a sensible approach.

Today, OPM promulgated proposed rules governing the ACA created program that makes FEHBP coverage available to Native American tribal employers.  OPM rolled out this program a few years ago relying on subregulatory guidance.  A major difference between the federal employee program and the tribal employee program is that

Section 890.1417 [of the proposed rules] states that an FEHB enrollment cannot be continued into retirement from employment with a tribal employer. This is a statutory requirement as the law entitles tribal employers to purchase FEHB for employees but it does not extend that entitlement to permit tribal employers to purchase FEHB for retirees.

The public comments deadline for both proposed rules is Halloween, October 31, 2016.

Earlier this week the Health and Human Services Department issued its proposed 2018 Notice of Benefit and Payment Parameters, a major annual ACA issuance.  Professor Timothy Jost requires two articles in the Health Affairs Blog to discuss it.  If you are glutton for punishment here is a link to the notice which will be published in the Federal Register on September 6.  As noted in CMS’s three page long fact sheet on the notice,

Annual Limitation on Cost Sharing: The maximum annual limitation on [in-network] cost sharing [for group health plans other than high deductible plans with health savings accounts] is the product of the dollar limit for calendar year 2014 ($6,350 for self-only coverage) and the premium adjustment percentage for 2018, rounded down to the next lower $50. We are proposing a maximum annual limitation on cost sharing for 2018 of $7,350 for individual coverage and $14,700 for family coverage.

A friend called my attention to the fact that next Wednesday August 31 is the deadline for submitting comments to the Labor Department’s mental health parity task force.  The FEHBlog will provide his comments to you.  The national mental health parity law requires health plans to separate our mental health and substance abuse benefits so that they can be compared to medical and surgical benefits. The FEHBlog’s suggestion is to end the benefits siloing (simply cover hospitalizations and office visits for all diagnoses just the way that prescription drugs are covered now) and focus instead on network adequacy for all providers, including mental health providers.

Here’s a link to a Blue Cross report on caesarian deliveries which happily finds that

While geographic disparities exist, the data found a consistent decline in the national rate of cesarean births reversing a 20-year trend of increasing rates. During a five-year period between July 2010 and June 2015, the cesarean rate decreased slightly each year within the Blue Cross and Blue Shield (BCBS) member population, to 33.7 percent from 35.2 percent. The 1.5 percentage point decrease in cesarean deliveries represents approximately 36,000 more vaginal births than expected during the five-year study period. 

The FEHBlog also was happy to read that the Surgeon General has “sent a letter to 2.3 million American health professionals, asking them
to lead a national movement to turn the tide on the nation’s
prescription opioid epidemic.”   The letter also included a copy of the CDC’s pocket guide on prescribing opioids.

On the not so bright side, the Federal Times reports on the growing prospect for a jump in 2017 Medicare Part B premiums for CSRS annuitants (absent Congressional action).

This is the 2001st post in the over 10 year history of the FEHBlog.

Fedsmith.com helpfully has provided links to Federal Benefits Open Season materials that OPM circulated to other government agencies last week. The FAQs are particularly worth a gander.

FYI, the Labor Department’s Employee Benefits Security Administration, which enforces ERISA, has refreshed its website. Another ERISA website worth monitoring is the National Association of Insurance Commissioners’ ERISA Working Group which recently posted ERISA Handbook revisions.

Health IT Security.com reports that HHS’s Office for Civil Rights, which enforces HIPAA’s Privacy and Security Rules, is implementing this month “an initiative to better investigate smaller data breaches. The data breach investigation process will look further into the root causes of incidents affecting fewer than 500 individuals, according to OCR.”  The national data breach rule requires annual reporting of these “smaller” breaches (within 60 days following the end of the year in which the breach occurred). Larger “incidents” must be reported within 60 days following discovery.

In an encouraging development related to the opioid abuse epidemic in the U.S. the Food and Drug Administration last week approved an innovative opioid:

Pfizer’s (NYSE:PFE) abuse-deterrent TROXYCA ER (oxycodone hydrochloride and naltrexone hydrochloride) are extended-release capsules for the management of pain severe enough to require around-the-clock long-term opioid treatment and for which alternative treatment options are inadequate.The product is formulated in pellets with a core of sequestered naltrexone hydrochloride, an opioid antagonist, surrounded by the pain medication oxycodone hydrochloride. When taken as directed, the naltrexone remains sequestered while the patient receives extended-release oxycodone. When the pellets are crushed, naltrexone is released which counteracts the effects of the opioid.

Finally, Prof. Timothy Jost from the Health Affairs blog reports on a lawsuit that a group of States and private organizations filed in a Texas federal court today in an effort to block the onerous HHS non-discrimination in HHS funded health programs rule implementing Public Health Service Act Section 1557.   The FEHBlog will be keeping an eye on this lawsuit.

The Washington Post has another article today on the health problems afflicting rural Americans.  This article concerns McCreary County, Kentucky.

Over the last 15 years, McCreary County has seen a 75 percent increase in the mortality rate for white women between the ages of 35 and 59, one of the highest increases in the nation, according to a Washington Post analysis of national mortality rates. The analysis also showed that the mortality rate for similarly aged white women nationally increased 23 percent; for white men increased 16 percent; for black women decreased 10 percent; for black men decreased 20 percent; for Hispanic women decreased 11 percent; and for Hispanic men decreased 16 percent.

Strangely, this series of lengthy articles generally does not dig into the problems or suggest solutions.   The FEHBlog suggests that time is better spent reading Hillbilly Elegy by J.D. Vance.

The Wall Street Journal attributes the rapid increase in ransomware crime to better encryption (which criminals seem to use more than others) and more widespread use of Bitcoin.

The Federal Bureau of Investigation said ransomware attacks cost victims $209 million in the first three months of the year, including costs, such as lost productivity and staff time to recover files, that is an average of about $333,000 an incident, based on complaints that it has received. The total is up from $24 million for all of 2015, or about $10,000 an infection, the FBI said. * * *

Ransomware is deviously simple. Often after tricking the victim into clicking on a malicious link or attachment, the software then encrypts files—often targeting Microsoft Office documents—and displays a message with instructions to recover them. A ransomware maker who calls himself “The Rainmaker” offers a $39 version of his software on hacker forums. A Microsoft spokesman said, “We are committed to helping protect our customers, and Office includes features to help prevent macro-malware infections.” 

Many ransomware attacks exploit known bugs in software, and attackers depend on people not installing updates. Criminals find ransomware easier and more profitable than other scams, such as breaking into consumers’ computers and stealing money via online banking, said Juan Andres Guerrero-Saade, a researcher with Kaspersky Lab ZAO. 

What a mess.

Health Data Management reports on ICD-10 coding concerns connected with the turn of the federal fiscal year on October 1, 2016.

Jim Daley, director of IT for BlueCross BlueShield of South Carolina and past chairman of the Workgroup for Electronic Data Interchange as well as WEDI’s ICD-10 co-chair, credits the success of organizations in meeting the Oct. 1, 2015, implementation deadline to the fact the industry had a lot of time to prepare.
One year later, Daley contends that organizations must now focus on three significant changes that will come into play starting Oct. 1, 2016:

• The ICD-10 Coordination and Maintenance Committee has lifted the partial code freeze and thousands of new codes have been added for federal Fiscal Year 2017, which begins October 1.
• The Medicare grace period on code specificity for Part B post payment audits will end Oct. 1, 2016.
• Payers may begin to adjust medical policies based on the new specificity offered by ICD-10.

The FEHBlog credits time to prepare plus the American Medical Association’s transition plan which ends on September 30, e.g., see second bullet.

CMS released  2014 Medicare Part D prescription drug spending data today.

The 2014 data set contains information from over one million distinct health care providers who collectively prescribed approximately $121 billion in prescription drugs paid for under the Medicare Part D program. This represents a 17 percent increase compared to the 2013 data set. The March 2016 Department of Health and Human Services report provided a detailed analysis of prescription drug spending trends, and noted that overall prescription drug spending in the United States rose by 12.6 percent between 2013 and 2014.

Cost curve up.

Healthcare Informatics shares interesting FBI observations on the cybersecurity front.

With regard to the biggest group of those threatening healthcare organizations right now, Wallach noted that the cyber-criminals involved now are conducting activity to steal information and monetize it. “Healthcare information is worth a lot of money on the dark web,” he said. “The bad guys want to target information that they can eventually monetize.” And patient records are treasure troves of usable data, unfortunately for the leaders of patient care organizations.

Ruh roh.

Finally, the FEHBlog enjoyed reading this STAT article about genetic variations in DNA. Medical researchers keep growing their knowledge base as genome sequencing technology improves. But there is still a lot of work to do. “It’s shocking that there are thousands of genes that are important, and we still don’t know what they do,” said [Dr. Jay] Shendure, the University of Washington geneticist.

Modern Healthcare has a timely article about the future of HIPAA as it approaches its 20th anniversary of enactment next month.  The law was updated in 2009.  Congress should take another look at it. In the FEHBlog’s view the major problem with the law is that it embeds technology in law and technology changes occur much more rapidly than changes in the law. 

Another Congressional initiative was to create a phased retirement option in the federal government.  Federal News Radio reports that less than 100 federal employees have applied for the option so far.

Retirement eligible federal employees who sign up for the program
agree to work part-time in their positions while collecting half their
salary and half their accumulated retirement annuity. Once approved,
phased retirees must dedicate part of their working hours — 20 percent
in some cases — to mentoring other employees who plan to take over their
job responsibilities once they leave.

Congress passed a law in 2012 authorizing the phased retirement program for federal employees. But final regulations
didn’t come from OPM until 2014. Agencies got the green light in
November 2014 that they could begin accepting applications for the
program from their employees.

Individual agencies are responsible for issuing and implementing
their own specific guidelines on phased retirement. But many agencies
have been slow to unveil them, and some, like the Social Security Administration, have opted not offer the phased retirement to their employees.

The Defense Department is the latest agency to offer more details
about its phased retirement program. DoD components are opting to
introduce phased retirement based on their own terms and mission needs.

Continuing on the topic of legislative initiatives, Health Affairs discusses federal and state efforts to enact “telehealth parity laws” which require the insurers to pay equivalent amounts for brick and mortar vs. telehealth visits. Supporters believe that parity will encourage the expansion of telehealth and while parity would improve the profitability of telehealth, would it lower the cost curve? 

Congress remains out of session until September 6.

On Friday, as  Bloomberg reports, U.S. District Judge Amy Berman scheduled the trial in the Justice Department’s lawsuit to block the Anthem/Cigna merger to begin on November 21.  According to the scheduling order,  [the government] will have no more than ten trial days in which to present their case-in-chief, defendants will have no more than six trial days in which to present their case-in-chief, and [the government will have two trial days for rebuttal. The trial will end by December 30, and the judge will issue her decision in January.

Both Judge Berman and U.S. District Judge John Bates, who presides over the Aetna/Humana merger case, have appointed retired D.C. Superior Judge Richard A. Levie to serve as special master to keep those cases on track given the compressed pretrial preparation period.

Modern Healthcare reports on the difficulty that insurers and providers are encountering when trying creating bundled payment methodologies for maternity cases.  What’s odd is that obstetricians traditionally have billed on a bundled basis, and hospitals bill for the mother and baby on a bundled basis.  Nevertheless, problems arise with the outlier cases, which can’t be readily predicted.

Let’s kick off the weekend with some career move announcements:

• Earlier this week, OPM announced “the hiring of a new permanent Chief Information Officer (CIO). David De Vries, currently the Principal Deputy Chief Information Officer at the Department of Defense, will join OPM as CIO in the coming weeks. De Vries joins OPM after a distinguished career spanning more than 35 years at the Defense Department, the last seven in the Senior Executive Service in DoD CIO. While at the Defense Department, De Vries was instrumental in the transition of DoD information technology (IT) to a single, secure department-wide architecture—similar to the plan OPM has been implementing. De Vries was also influential in the Defense Department’s cybersecurity initiatives.”  
• Yesterday, as Health Data Management reports, “Karen DeSalvo, national coordinator for health information technology, will be leaving her technology office position, to be replaced by Vindell Washington, MD, currently serving as the principal deputy national coordinator at ONC.” Ms. DeSalvo is moving to another position at HHS.

The Wall Street Journal reports this afternoon that U.S. District Judge John Bates has decided a trial in the Justice Department’s lawsuit to block Aetna/Humana merger will begin on December 5, 2016, and is expected to last 13 days. This injunction case necessarily will be tried to the judge.  The judge expects to issue a ruling in mid-January 2017. The defendants had wanted an October trial date and the Government had wanted a February trial date.  The article adds that ”  Judge Amy Berman Jacksonis now presiding over the Anthem[/Cigna merger] matter. She has set a hearing this Friday to discuss trial scheduling for that case.”

Kaiser Health News reports on a National Business Group on Health survey of large employers. The upshot of the report is that large employers are expecting a 5% increase in employee healthcare costs next year.

Speaking of healthcare costs, here are a few interesting tidbits:

• AHA News reports 

Medicare Advantage plans paid about 8% less for hospital services than fee-for-service Medicare in 2009 and 2012, according to a study published yesterday by Health Affairs. About one-third of the difference was due to the narrower hospital networks in Medicare Advantage, the authors said. “Consistent with previous work, we found that commercial plans paid significantly more than either Medicare Advantage or FFS Medicare,” the study notes. The data on MA and commercial plans was from the Health Care Cost Institute, and represented about 31% of the elderly MA population and 27% of the non-elderly population covered by commercial plans.

• Fierce Healthcare tells us about an eHealth Careers survey on healthcare provider incomes which finds that doctor and physician assistant incomes are up while nurse incomes are down. 
• The Wall Street Journal offers an eyepopping story on how the cost of new medical tests administered in doctor’s offices is driving up Medicare costs.  
• Given the fact that the Kaiser Health News article which lead off this section described the 5% projected increase as “moderate, the FEHBlog calls your attention to this Health Affairs Blog article suggesting that the U.S. may not be able to afford moderate healthcare spending increases like this. 

When Medicare Advantage patients pick up all their medication refills on the same day at the same place, medication adherence improves, according to a joint study from Penn Medicine and Humana’s research arm. “Synchronizing” refills over the course of 12 months increased adherence by 3 percent to 5 percent, according to the study. The researchers said the effect was more pronounced among patients with lower baseline adherence.

Interesting.

Congress remains out of town this week.  Here are a couple of mop-up items from the Hill newspaper:

• CMS unveiled its new 2017 value based comprehensive primary care program for Medicare in 16 states. The American Medical Association was pleased with the program “at first glance.”   Improving primary care in Medicare helps the FEHBP because so many FEHBP enrollees have primary Medicare coverage.  
• The Centers for Disease Control issued a study on tobacco smoking use in the U.S.  The report finds tha use remains high among certain ethic groups. The study suggests focusing anti-smoking efforts on those groups.