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December 19, 2016

Washington Health Policy Week in Review Archive e233be24-44ae-449d-9f92-f29d2c30929b

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Thank You

Thank you for your readership of Washington Health Policy Week in Review, which has featured several licensed CQ HealthBeat stories in each issue. Starting in January, this newsletter will be replaced by Headlines in Health Policy, a round-up of health policy and practice articles from across the Internet, which we have introduced over the last few months. 

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Obama Administration Pushes New Health Care Data

By Joe Williams, CQ Roll Call

December 13, 2016 -- The Department of Health and Human Services (HHS) on Tuesday defended President Barack Obama's signature health care law with a massive new report on improvements to health care in the U.S. since it took effect. The compilation of federal and state-by-state data comes as Republicans in Congress work through their strategy to repeal large aspects of the overhaul.

The information, which does not provide any new statistics on the ongoing open enrollment period that runs through Jan. 31, is intended to highlight the benefits of the Affordable Care Act. More than 20 million new individuals received insurance under the law. The Centers for Medicare and Medicaid Services in late November, when the most recent public data from the agency was released, said 2.1 million new individuals have signed up or re-enrolled for insurance during the current open enrollment period. 

The national rate of uninsured individuals in the U.S. is now under 9 percent, according to HHS. Over 10 million individuals are currently covered under the individual insurance marketplace, and more than 150 million receive coverage through employer-sponsored health care plans.

HHS released similar statistics for each of the states in a new analysis. In Kentucky, for example, the home state of Senate Majority Leader Mitch McConnell, the number of people without insurance fell by 61 percent since the health care law was enacted in 2010. About 151,000 individuals in the state gained health coverage since Kentucky expanded its Medicaid program under the law, according to HHS estimates based off Urban Institute's projections of how many people would lose coverage if the law were repealed. Fewer than 75,000 people are covered through the marketplace. Most people, however, get their employer-provided coverage, which was not affected as dramatically by the health care overhaul as Medicaid or the individual market were. More than 2 million people in Kentucky receive health coverage through their jobs. 

The uninsured rate in Wisconsin dropped by 39 percent since 2010. More than 3 million individuals in Wisconsin, the home state of House Speaker Paul D. Ryan, get employer-provided coverage. The state did not expand Medicaid. Just over 224,000 people receive coverage from the individual marketplace.

"Americans have better health coverage and health care today as a result of the [health care law]. Millions of Americans with all types of coverage have a stake in the future of health reform, and it's time to build on the progress we've made, not move our system backward," HHS Secretary Sylvia Mathews Burwell said in a written statement.

The data from HHS is unlikely to sway the minds of Republican lawmakers who are charging ahead with their plans to repeal the health care overhaul. Disregarding concerns from actuaries, hospitals, insurance companies and other interest groups, McConnell on Monday said repeal legislation would be enacted before a replacement mechanism is established.

But the HHS information could help bolster the chances that several popular provisions are maintained in any new health care system.

A key provision in the 2010 law that many GOP lawmakers hope to keep in some form mandates that insurers could not deny coverage to individuals based on a pre-existing condition. Some Republicans, however, would like to allow insurers to either deny coverage or charge more if a consumer had previously dropped his or her coverage.

As many as 129 million individuals could be denied coverage should that policy be reversed, according to data from HHS. In comparison, the Kaiser Family Foundation on Monday released a report that estimated that 52 million individuals under the age of 65 could be denied coverage based on a pre-existing condition before the law took effect. 

HHS also said the number of uninsured young adults fell by 53 percent since 2010. Roughly 2.6 million individuals under the age of 26 obtained coverage under their parent's health care plan, a policy included in the health care law that many Republicans, including President-elect Donald Trump, have supported.

The department said 15.7 million people have received coverage under Medicaid as a result of the program's expansion under the law, a provision that Republicans attempted to undo in the repeal legislation (HR 3762) passed last year that Obama vetoed. GOP leaders have advocated for switching Medicaid over to a block grant or per capita grant system, arguing that it would provide states more flexibility and reduce regulatory burdens. Critics, however, say such a system could diminish benefits if the amount of money provided to the states is not increased year by year.

The health care law, coupled with legislation (PL 111-3) enacted in 2009 to improve the Children's Health Insurance Program or CHIP, has also provided health insurance to more than 3 million more children, HHS said. Republicans and Democrats are preparing for a looming battle over a reauthorization of the CHIP program that is currently set to expire on Sept. 30, 2017.

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HHS Touts Historic Number of Single-Day Obamacare Enrollments

By Joe Williams, CQ Roll Call

December 16, 2016 -- More than 670,000 people signed up for insurance coverage under President Barack Obama's signature health initiative on Thursday, the biggest enrollment day since the law took effect, according to a spokesperson for the Department of Health and Human Services (HHS).

Because of the high demand, the spokesperson said the Obama administration has extended the deadline to sign up for an insurance plan and receive coverage under the Affordable Care Act by Jan. 1, 2017 to Dec. 19. The original deadline was Dec. 15.

This follows an enrollment snapshot released earlier this week from the Centers for Medicare and Medicaid Services that said that 1.1 million new customers have signed up for insurance this open enrollment period, according to data from Nov. 1 to Dec. 10. The current enrollment period ends Jan. 30, 2017.

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McConnell: Obamacare Repeal to Come Before Replace

By Joe Williams, CQ Roll Call

December 12, 2016 -- Senate Majority Leader Mitch McConnell on Monday confirmed that Republicans will take steps early next year to repeal aspects of President Barack Obama's signature health law before a replacement system is put in place.

His comments come as some GOP lawmakers in Congress have said a blueprint for replacement should be established before any repeal action is taken to gut the 2010 health care overhaul.

"We will move right after the first of the year on an Obamacare [repeal] resolution and then we will work expeditiously to come up with a better proposal than current law," the Kentucky Republican told reporters.

Republicans in Congress hope to include in the repeal a transition period, but McConnell said the timing of that transition has yet to be determined.

A number of key interest groups have voiced concerns over the past few weeks about the impact that repeal without a replacement would have on the insurance marketplace.

"Delaying enactment of a replacement for two or three years, and leaving insurers without any certainty in projecting risk, could lead to the collapse of the individual health insurance market with long-term consequences," Chris Hansen, president of the American Cancer Society Cancer Action Network, said in a statement last week.

Health and Human Services Secretary Sylvia Mathews Burwell last week discussed with Senate Democrats the chaos that would ensue if repeal were to be enacted without a replacement mechanism in place, according to lawmakers leaving the meeting. Democratic allies, such as Families USA, union groups and the National Partnership for Women and Families, are launching digital and print ad buys in five states and Washington, D.C., through a new coalition known as the Alliance for Healthcare Security. 

Some GOP lawmakers are concerned about the potential impact of moving forward with repeal without an alternative system.

"It's important to outline a framework at the same time that we're revamping" the health law, Sen. Susan Collins, R-Maine, told reporters last week. "If we wait until the end of the transition time to develop a replacement, it's not going to work."

Collins' remarks echoed similar comments she made in an earlier interview with CQ Roll Call.

Nearly unified support from Senate Republicans will be necessary to pass a repeal bill. Despite plans to use a budget tactic known as reconciliation that requires only 51 votes to pass, the GOP will only hold 52 seats in the Senate next year. Vice President-elect Mike Pence could provide the 51st vote after Jan. 20. But even a few defections could force Republicans to pressure Democrats running for re-election in 2018 such as Sen. Joe Manchin III, D-W.Va., to switch their votes and support repeal.

Congress last year passed repeal legislation (HR 3762) using the same method that was then vetoed by Obama.

Key lawmakers, like Senate Health, Education, Labor and Pensions Chairman Lamar Alexander, have said a transition period is necessary so a new system can be put in place before the health law is completely repealed.

"Congress should replace and repeal at the same time, which requires figuring out how to replace it before fully repealing it. To avoid the historic mistakes of Obamacare, that replacement should be implemented step by step to minimize disruptions and make sure the changes in the system work well," the Tennessee Republican told CQ Roll Call.

McConnell on Monday declined to comment on whether Republicans would pursue a piecemeal approach to replacement.

President-elect Donald Trump has voiced support for keeping aspects of Obama's health law, like a provision that prevents insurers from denying coverage to individuals with pre-existing medical conditions. A report released Monday from the Kaiser Family Foundation found that 52 million adults under 65 would likely be unable to obtain insurance in the individual market should that provision be repealed.

But Republicans are likely to repeal a key measure included in the health overhaul that requires U.S. citizens to purchase insurance or pay a yearly fine. Without that requirement, many health experts say healthy individuals could opt out of buying coverage. That could leave an increasing percentage of sick individuals in the marketplaces, which could result in drastically higher premiums and set off a so-called death spiral in the individual insurance market.

America's Health Insurance Plans, the industry's main trade group, previously signaled it would support a repeal of the mandate if Congress were to provide additional incentives to support insurance companies and bring healthier individuals into the marketplace.

Republican lawmakers appear to be divided on whether those incentives would mean additional federal support for insurance companies.

"As far as the broader picture of a replacement and how we deal with the current tax treatment, that's something we are going through," Sen. Marco Rubio, R-Fla., told CQ Roll Call, adding that he does not want to see any federal funding go to help insurance companies.

However, several lawmakers, like Alexander and Sen. Bill Cassidy, R-La., have kept open the possibility that additional money could go to help the insurance industry following repeal.

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House GOP Aims to Have Obamacare Replacement Ready for Trump

By Joe Williams, CQ Roll Call

December 15, 2016 -- House Republicans hope to be ready in January with a new system to replace President Barack Obama's health care law, according to Ways and Means Chairman Kevin Brady. But he declined to provide specifics Thursday.

GOP lawmakers on the panel are in the midst of a two-day policy discussion focused on taxes and health care. 

Republicans "are here in the Capitol while Congress is adjourned for the holidays to make sure we have ready for our new president and administration, the American people, a health care plan that is dramatically different than Obamacare," the Texas Republican told reporters during a break in the closed-door meeting.

Senate Majority Leader Mitch McConnell of Kentucky on Monday said Republicans would aim to pass repeal legislation through a budgetary tactic known as reconciliation early next year. That method only requires 51 votes in the Senate, as opposed to the typical 60.

Brady criticized Democrats for spreading assertions that 22 million individuals who currently receive coverage under the law will lose their health insurance plan following repeal.

"The Republicans will provide an adequate transition period to give people peace of mind that they will have those options available to them as we work through this solution," he said, but declined to describe the length of the transition period the GOP is considering.

A number of interest groups—including organizations representing hospitals, insurers and actuaries—have warned that passing repeal legislation without a replacement in place could destabilize the insurance markets.

Brady did not discuss any details regarding what would be in the replacement plan that Republicans were working on. Any proposal will likely face criticism from conservatives, as there remains little consensus within the GOP on a replacement system.

And some Republicans criticize the high deductibles that have become more common in the current health insurance marketplaces for individuals who buy coverage without help from their employers.

"What would a replacement look like that actually provides meaningful coverage and protects against medical bankruptcy?" a Senate GOP aide mused to reporters Thursday. "With a $6,000 deductible, is it even meaningful to have insurance?"

Brady was asked Thursday whether he would support so-called first-dollar coverage, a type of policy in which an insurer typically covers medical costs from the initial service without making people pay a deductible first. Brady said Republicans were looking at all options.

"We're giving very serious thought to how to provide the best health care and freedom possible," he said.

One lingering question is how the GOP might look to stabilize the insurance marketplace after repeal. House Republicans, for example, are in the midst of a lawsuit with the Obama administration over the law's cost-sharing subsidies for very low-income people. The subsidies reduce out-of-pocket costs, such as deductibles, for people whose income is no more than 2.5 times the federal poverty line. A federal court ruled on the case earlier this year that those payments were illegal, but a federal appeals court recently granted the GOP's request to delay action on the case until next year.

"If the lawsuit is withdrawn and the lower court ruling stands, then insurers will no longer be getting paid for the cost-sharing subsidies, and that could cause severe market disruption very quickly. So I don't know what the solution is to that," a House Democratic aide said Thursday.

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Health Experts Question Aspects of Republican Health Plans

By Andrew Siddons, CQ Roll Call

December 16, 2016 -- Republican proposals to replace President Barack Obama's health care law will have a tough time overcoming certain policy hurdles, according to a group of experts speaking at the American Enterprise Institute (AEI) on Friday.

Congressional Republicans have not yet reached a consensus on exactly how they will overhaul the health system next year, but several core proposals are under discussion.

For instance, a white paper put forward by House Speaker Paul D. Ryan, R-Wis., would replace a mandate for insurance coverage with different incentives to have and maintain coverage. People with preexisting conditions wouldn't be denied coverage, according to his blueprint. They wouldn't be charged more for coverage as long as they remain continuously insured.

That would present some tricky policy questions for lawmakers and insurers alike. The continuous coverage requirement could prove to be complicated, especially for people who are between jobs or for families undergoing changes due to death or divorce, according to Robert Reischauer, a fellow at the liberal Urban Institute and a former director of the Congressional Budget Office.

"That could prove to be horrendously complex to administer and prove to be quite intrusive, if you have to keep a record of every month that every person has insurance," he said.

John McDonough, a public health professor at Harvard who helped shaped the current health care law as a Senate adviser from 2008 to 2010, said that the well-off might find it easier than lower-income people to maintain coverage. He questioned just how that mechanism might work and how long individuals might be penalized if they drop their coverage.

"How do you maintain continuous coverage? How long is the gap?" he asked.

Another potential policy change favored by President-elect Donald Trump would allow insurers to sell coverage across state lines, potentially increasing competition and creating larger customer bases for insurers to make their business models work.

That would also present complications, requiring state insurance commissioners to harmonize regulations, and challenges for any state-based high-risk pools that could lose customers to insurers elsewhere.

"Anyone who implies that moving in that direction is some sort of a game-changer really doesn't understand how insurance markets currently work," said Scott E. Harrington, a professor of health care management at the University of Pennsylvania's Wharton School of Business. 

Republicans have promised to repeal different parts of Obama's health law, including the mandate for most individuals to have coverage and large employers to offer insurance to their workers, and different taxes that have been used to subsidize consumers on the individual markets.

Without a replacement plan in place, Democrats and the insurance industry have warned that the market could enter a period of turmoil as some customers stop paying premiums and only the sickest sign up for coverage. In order to counter this, many believe that some kind of financial support will be necessary to help the insurance industry in the short term.

"I think some stability mechanism really would be desirable to ensure things work," Harrington said.

Thomas P. Miller, a fellow who specializes in health policy and insurance at AEI, a conservative think tank, agreed that Republican lawmakers would likely have to do something to incentivize insurance companies during the transition.

"You can stage manage transitions however you want to. You flush dollars out the door to keep people at the table, or you threaten them with higher taxes for exiting those markets as the flip side of it," he said.

But he did not think that repeal would lead to turmoil in the insurance industry. "You self-correct, you sell different products, you do it different ways," Miller said. "It never hits that explosive point. We move on to another set of disappointing, frustrating policies, and that's what we call success."

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Experts Predict Trump Officials Will Change Doctor Pay Rules

By Kerry Young, CQ Roll Call

December 13, 2016 -- Physicians' groups likely will succeed in pressuring the Trump administration to ease requirements and administrative demands that the recent Medicare payment overhaul created, former top federal health officials said.

Medicare is in the midst of carrying out last year's law (PL 114-10) that's meant to peg physicians' pay more closely to judgments about the quality of care they provide. Medical groups already gained concessions when Centers for Medicare and Medicaid Services (CMS) allowed some medical practices to delay implementation and exempted smaller practices from reporting requirements. Doctors will press for more, even though the overhaul law has strong bipartisan backing, said former leaders of CMS Tuesday at the American Bar Association's Washington health law summit.

Doctors already frequently complain about time lost from patient care to enter data about treatments or tests their practices have provided. Last year's Medicare Access and CHIP Reauthorization Act relies heavily on such recordkeeping to help CMS officials make judgments about care. Jonathan D. Blum, a former principal deputy administrator at the Centers for Medicare and Medicaid Services in the Obama administration, said there will be "tremendous pressure" for delays and changes in MACRA rules. Leslie V. Norwalk, an acting CMS administrator for President George W. Bush, noted that Trump tapped a critic of the agency's implementation of the law as his nominee to lead the Department of Health and Human Services, Rep. Tom Price, R-Ga.

"Price has already complained about MACRA," Norwalk said.

Lawmakers may be reluctant to revisit the details of the 2015 law, leaving it to CMS to find ways to change the rules as much as allowed within the statute, she said. "There will be a big push to use that flexibility," Norwalk said.

Blum, Norwalk and Thomas A. Scully, who was a CMS administrator under President George W. Bush, also said they expect Medicare to continue to experiment with alternative forms of payments despite the current GOP ire with CMS' Innovation Center, which was created to experiment with payments or care through demonstration projects.

Many Republicans, including Price, complain about the center's experiments that compel participation of certain doctors and hospitals. CMS appears for now to have put on hold the center's most controversial proposal, a nearly nationwide test of an alternative form of payment for drugs administered in doctors' offices. Known as the Part B drug model, this proposed test would have covered payments for many cancer treatments.

The 2010 health law (PL 111-148, PL 111-152) gave the CMS Innovation Center an initial $10 billion in funding. Scully said Republicans may change their view of the center once they take change of CMS again and gain a better appreciation of how "powerful" it is as a tool for changing policy. They could look at it as a path for attempting to implement a House GOP goal of increasing insurers' role in administering Medicare, known as premium support, Scully said.

CMS may rebrand its program for testing forms of payments, but likely will continue to move away from the fee-for-service program, Norwalk said. Medicare's payment rules now often give doctors more money for doing additional procedures, which can waste government funds while posing some risk to patients, according to Norwalk. CMS officials will want to continue efforts to revamp payments to change these incentives, she said. CMS' Innovation Center in recent years has looked at bundled payments and systems that are intended to reward or punish hospitals and doctors based on the results delivered for patients.

"So I do imagine that we'll have these programs, in some way, shape or form, continue," she said.

Republicans in Congress and President-elect Donald Trump have set a repeal of the 2010 health law as a top priority for next year. Some Republicans are seeking to have that repeal take effect slowly, so that they can create an alternative. They appear likely to prevail, according to Scully's view. 

"Nothing in the law is going to change for two years, most likely," Scully said.

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Senate Finance Republicans Seek GOP Governors' Input on Medicaid

By Kerry Young, CQ Roll Call

December 13, 2016 -- Republican members of the Senate Finance Committee on Tuesday invited GOP governors to provide feedback on future changes to Medicaid, which consumes a sizable chunk of state budgets nationwide. The lawmakers are readying for a planned partial repeal of the 2010 health law that allowed states to expand eligibility for the state-federal health program.

Senate Finance Republicans addressed their letter to members of the Republican Governors Association, a group that largely opposed the Medicaid expansion of the 2010 law. Still, many Republican governors did expand the program and even in those that didn't, there's been a significant increase in the Medicaid rolls in many states with GOP senators.

Sen. Patrick J. Toomey, R-Pa., is among the signers of the Finance letter to Republican governors. After the health care law was enacted, about 548,000 more people signed up for Medicaid in Pennsylvania, according to the Kaiser Family Foundation. A GOP governor had expanded the program. 

"We are acutely aware that in dismantling the ACA we have a responsibility for ensuring that Medicaid continues to provide quality of care for our nation's most vulnerable citizens," the Senate Finance Republicans said in their letter. "In addition, we recognize that we have the opportunity to reflect on flexibilities that states have gained in recent years as well as the factors that inhibit states from pursuing innovations and responding to the unique needs of their Medicaid beneficiaries."

President-elect Donald Trump has selected as his nominee for chief of the Centers for Medicare and Medicaid Services (CMS) a consultant who helped negotiated an expansion deal for Indiana's GOP leaders. Seema Verma is expected to be more open to alternative ideas that leaders in other states will present for their Medicaid programs. More than 220,000 people in Indiana became eligible for Medicaid under the expansion, according to Kaiser's figures.

Federal lawmakers and Medicaid officials will face budget woes if they seek to allow Medicaid programs that expand coverage, said Thomas Scully, a former CMS administrator, at the American Bar Association's Washington health law summit. Even before the ACA expansion, significant federal money previously supported state efforts to test new approaches to expanding health coverage through Medicaid, Scully said. Given GOP lawmakers' campaign calls for restraining federal spending, states are unlikely to receive much further help of this kind, he said. That will lead to jockeying for available funds, which Scully described as "a massive state-by-state formula fight."

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