"There are some things in this set of proposals that can move us in the direction of lower prices for some people. At the same time, it is not clear at all how they are going to lower list prices." — David Mitchell, founder of Patients for Affordable Drugs, on President Trump's May 12 prescription drug speech 

• Drug Plans Drop After Trump Official Targets PBM's Ahead of Speech Bloomberg News by Cristin Flanagan — Shares of CVS Health Corp. and Express Scripts Holding Co. slipped Monday after one of the Trump administration's top health-care officials said the companies' roles as intermediaries between drugmakers and health plans was hurting patients. Known as pharmacy-benefit managers, or PBMs, the plans negotiate with drugmakers to put their products on lists of covered drugs in return for discounts, and steer patients toward options that they say save them and employers money. Those dual roles are in conflict, said Seema Verma, administrator of the Centers for Medicare and Medicaid Services. "PBMs are serving two customers — being paid both by manufacturers for getting on formularies and by plans for managing their drug benefit. This makes it unclear who they're actually aligned with," Verma said in prepared remarks for a speech at the American Hospital Association Annual Membership Meeting in Washington. "The bottom line is that all of the incentives are lined up for manufacturers to set higher and higher prices."
  
  
• To Lower Drug Costs at Home, Trump Wants Higher Prices Abroad New York Times by Robert Pear — President Trump, poised on Friday to unveil his strategy to lower prescription drug prices, has an idea that may not be so popular abroad: Bring down costs at home by forcing higher prices in foreign countries that use their national health systems to make drugs more affordable. On Tuesday, Mr. Trump rebuffed his European allies by withdrawing from the Iran nuclear deal. Threatened tariffs on steel and aluminum have strained relations with other developed nations. And now the administration is suggesting policies that could hit the pocketbooks of some of America's strongest allies. "We're going to be ending global freeloading," Mr. Trump declared at a meeting with drug company executives in his first month in office. Foreign price controls, he said, reduce the resources that American drug companies have to finance research and develop new cures. The White House Council of Economic Advisers fleshed out the idea three months ago in a report that deplored the "underpricing of drugs in foreign countries."

• Drug Industry Dodges Its Worst Fears in Trump’s Plan to Lower Prices  Bloomberg News by Anna Edney, Erik Wasson, and Robert Langreth — President Donald Trump’s plan to lower U.S. drug prices avoids some of the harshest steps that the pharmaceutical industry and the network of companies that distribute its products feared. Nowhere in the proposal does the administration call for two policies the industry most feared: having the government directly negotiate prices and allowing the importation of prescription drugs from overseas. Trump had previously backed both of those ideas, promising to use the government’s buying power to get better deals.

• Obamacare Premiums to Surge Next Year, Early Requests Show  Bloomberg News by John Tozzi — The first glimpse of what health-insurance companies plan to charge for Obamacare plans next year suggests there's no relief ahead for consumers saddled with high premiums. Several insurers in Maryland and Virginia are seeking double-digit percentage increases in monthly costs for individual medical plans in 2019. The largest increases are being sought by CareFirst, which wants to nearly double the amount it charges on average for one coverage option in Maryland, and raise the cost of another in Virginia by 64 percent.
  
  
• The Uninsured Rate Is Worsening After Years of Obamacare's Gains  Huffington Post by Jeffrey Young — The uninsured rate is creeping back up. After several years of dramatic declines in the percentage of Americans who lack health insurance ― a direct result of the Affordable Care Act's coverage provisions ― the trend is beginning to reverse, according to new data the polling firm Gallup and digital health company Sharecare published Wednesday. The Gallup-Sharecare survey is the second this month showing a rise in the number of people without health coverage. According to a Commonwealth Fund report published last week, the share of adults ages 18 to 64 who are uninsured is 15.5 percent, up from 12.7 percent at end of 2016, which the think tank calculates amounts to 4 million fewer people with coverage.
  
  
• How the Farm Bill Could Erode Part of the ACA  Kaiser Health News by Julie Appleby — Some Republican lawmakers continue to try to work around the federal health law's requirements. That strategy can crop up in surprising places. Like the farm bill. Tucked deep in the House version of the massive bill — amid crop subsidies and food assistance programs — is a provision that supporters say could help provide farmers with cheaper, but likely less comprehensive, health insurance than plans offered through the Affordable Care Act. It calls for $65 million in loans and grants administered by the Department of Agriculture to help organizations establish agricultural-related "association" type health plans. But the idea is not without skeptics.

• Congress Leery of Trump's Cuts to Children's Health Program  Wall Street Journal by Kristina Peterson  — President Donald Trump's proposal to roll back $7 billion from the popular Children's Health Insurance Program (CHIP) drew immediate bipartisan concern Tuesday, an indication of the hurdles the effort to cut federal spending will face in the Senate. The proposed cuts to the children's health program quickly emerged as the most contentious element of Mr. Trump's request that Congress rescind about $15 billion in funds that had been previously authorized but not spent. "It is a red flag with me," Sen. Shelley Moore Capito (R.–W.Va.) said of the proposed CHIP cuts, noting she was reviewing the proposal. "I've been a big proponent of CHIP from the beginning. It's vital to our state." Under the request sent to Capitol Hill on Tuesday, the Office of Management and Budget proposed to cut just over $5 billion from funding that helps reimburse states for expenses related to the program. The White House said the authority to spend that money had expired.

• Trump Officials Reject Medicaid Lifetime Limits in Kansas  The Hill by Peter Sullivan — The Trump administration announced Monday that it is rejecting Kansas's request to impose lifetime limits on Medicaid benefits, drawing a line against a new level of conservative changes to the program. The administration has already approved work requirements in Medicaid, a controversial move in itself, but Monday's decision indicates that time limits on Medicaid coverage go too far for the Trump administration. "We have determined that we will not approve Kansas' recent request to place a lifetime limit on Medicaid benefits for some beneficiaries," Centers for Medicare and Medicaid Services Administrator Seema Verma said Monday in a speech at a meeting of the American Hospital Association.
  
  
• New Hampshire Medicaid Expansion Work Requirement Approved by Washington  Concord Monitor by Ethan DeWitt — Federal authorities have approved New Hampshire's request to add a work requirement to the Medicaid expansion program, the governor's office announced Monday, clearing away a major barrier for reauthorization of the program. In a letter to the state released Monday afternoon, the U.S. Centers for Medicare and Medicaid Services Administrator Seema Verma said the agency will greenlight a waiver sent by the state last year. The waiver means individuals between the ages of 19 and 64 will need to participate in at least 100 hours a month of "community engagement activities" — which can include employment, community service or job training. The mandate includes numerous exceptions, including for people with children up to age 12 and those with disabilities.
  
  
• Illinois Wins Medicaid Flexibility Under Trump Modern Healthcare by Kristen Schorsch — Illinois Gov. Bruce Rauner has received federal approval to use $2 billion in Medicaid funding differently, a longtime goal that his predecessor Pat Quinn originally sought. The state plans to boost behavioral health services and combat the fast-paced opioid crisis as part of the new Better Care Illinois Behavioral Health Initiative. After all, about 25 percent of low-income and disabled people on Medicaid in Illinois have behavioral health needs, but they account for 52 percent of all spending, according to the state.
  
  
• Medicaid Managed Care: Lots of Unanswered Questions (part 1)  Health Affairs by Jeff Goldsmith, David Mosley, and Anne Jacobs — Enrollment of the nation's 74 million Medicaid recipients in managed care plans continues to increase. By 2016, an estimated 71 percent of Medicaid recipients were receiving their care via private health plans, both investor-owned and nonprofit. The theory behind this shift is that managed care plans can do things that state Medicaid agencies cannot, such as use sophisticated network contracting, information technology, and utilization management systems to squeeze out low-value care and improve the health of beneficiaries. However, recent revelations about Medicaid managed care contracting raise legitimate policy questions. Recent reports that managed care contractors in California's vast 13.3 million-person Medi-Cal program earned $5.4 billion in profits on their contracts in 2014 and 2015 (the first two years of the Affordable Care Act coverage expansion) have raised questions about the value proposition for taxpayers.
  
  
• GOP Senator Calls for Mandatory Medicaid Work Requirements  The Hill by Nathaniel Weixel — Republican Sen. John Kennedy (La.) on Thursday said Medicaid work requirements should be mandatory for states, and the Department of Health and Human Services (HHS) should take the lead to make it happen. During a hearing on the HHS budget, Kennedy said many Medicaid beneficiaries who aren't working "would like to know the dignity of work" noting he would like to see HHS work with Congress to put together a program that would institute a mandatory requirement that Medicaid beneficiaries work 20 hours a week. "I appreciate that [the Centers for Medicare and Medicaid Services] is willing to grant waivers, but why don't we take the next step?" Kennedy said, adding separately that "it's not going to be optional for governors." The Trump administration has been encouraging states to apply for waivers that would allow them to institute work requirements on Medicaid recipients — a policy that was denied by the Obama administration.

• Eyes Turn to Vermont as It Sees Success with Health System  Associated Press by Wilson Ring —  A Vermont health care organization working to keep patients healthier while reducing costs is being closely watched because of its rate of success: it was within 1 percent of meeting its financial target in its first year and has now been expanded to cover about 18 percent of the state’s population, officials said. Last year, OneCare Vermont covered about 24,000 Medicaid patients and now covers about 112,000 patients whose health care is provided through Medicare, Medicaid, and commercial insurance. The long-term goal is to expand it so that about 70 percent of health care services provided in Vermont are covered by the system, which encourages patients to stay healthier using specialized care, such as helping them manage chronic conditions like diabetes so they don’t wind up needing more expensive treatment. Officials consider 70 percent a realistic goal. Twelve states have Medicaid programs using variations of the model being used in Vermont, and another nine are planning them, said John McDonough, a health care policy expert at the Harvard T.H. Chan School of Public Health.


• Heading for the Exit: Rather Than Face Risk, Many ACOs Could Leave Modern Healthcare by Virgil Dickson —  Under Obama-era regulations, ACOs that started in [upside only] Track 1 in either 2012 or 2013 are supposed to move to a risk-based model by the third contract period, which begins next year. There are 561 Medicare ACOs this year, 82 percent of which are in Track 1. Leaving the Medicare Shared Savings Program has consequences, especially for an ACOs whose doctors don't have enough Medicare patients on their own to take part in the Merit-based Incentive Payment System created under MACRA. That means they won't be part of any value-based care initiatives….A mass exodus would likely undermine progress to move Medicare from a fee-for-service to a value-based pay system. ACOs have been critical in providing clinicians a full picture of the care patients receive elsewhere, leading to more informed doctors developing better care plans.

Editor: Peter Van Vranken