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February 17, 2015

Washington Health Policy Week in Review Archive b5b08dbf-0454-4fb6-8b26-ad653f0bf53b

Newsletter Article


Utah Republicans Weigh Medicaid Expansion

By Rebecca Adams, CQ Roll Call

February 9, 2015 -- The Utah legislature will debate Medicaid expansion this week, days after the issue faltered in Wyoming.

A few states are weighing whether to broaden eligibility in Medicaid, the federal and state partnership for the poor. The health care law allows states to choose whether to enroll for people with income of up to 38 percent above the poverty level. The issue died in Tennessee last week after GOP Gov. Bill Haslam was unable to persuade other Republicans to expand coverage.

In Utah, a plan by Republican Gov. Gary Herbert is competing against a different, narrower proposal by other Republicans to expand benefits for people who are medically frail. On Tuesday, Utah Republican legislators will meet in a closed-door meeting before deciding how to proceed.

Late last week, Herbert was asked by local reporters about opposition to his plan among his fellow Republicans.

The governor said that under his plan, it would cost the state about $236 million total over six years to win $3.2 billion from the federal government in matching grants. The health law says that the federal government will pay all of the costs of the individuals who qualify under the expanded guidelines through 2016, and then phase down that amount until the federal government pays 90 percent of costs in 2020 and afterwards.

The other plan put forward by GOP legislators would cost about $200 million, according to Herbert, but the governor said it would only attract $611 million in federal financing. Herbert said that his plan would help more than 100,000 more people than the alternative proposal Republicans are considering.  

“I think the contrast is stark,” Herbert said, according to an audio recording of the press conference.

He added that the other GOP proposal is “better than nothing, but it's not a lot better."

The GOP governor sought to distance himself from the overall law and the Obama administration, noting that he had been among the governors who challenged the constitutionality of the law in 2012 before the Supreme Court upheld the fine for people who don’t get coverage but gave states more of an opportunity to reject the Medicaid expansion.

Herbert said that the state is contributing money for coverage in other states.

“Obama took it from us,” he said. “I want it back.”

In Wyoming, the debate over Medicaid collapsed late last week. Republican Gov. Matt Mead had pushed for a plan to expand coverage, and other Republicans had promoted an alternative plan that mirrors one that the federal government recently approved in Indiana.

But the state Senate voted down the plan, and the House Labor, Health, and Social Services Committee abandoned plans to consider legislation.

“While I respect different views, the fact is today we are left with working poor without coverage,” said Mead in a statement on Friday evening. “We are left with Wyoming taxpayer dollars funding health care of other states. We are left without a solution for $200 million of uncompensated care that our hospitals must absorb and pass on to the rest of our citizens and we are rejecting $120 million dollars meant for Wyoming.”

So far, 28 states and the District of Columbia have expanded Medicaid. Of those, 10 states were led by Republican governors.

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New Pennsylvania Governor Will Replace Medicaid Waiver with Traditional Expansion

By Rebecca Adams, CQ Roll Call

February 10, 2015 -- Pennsylvania's newly elected Democratic governor intends to replace the Medicaid expansion plan put in place in by his Republican predecessor with a more straightforward proposal.

Gov. Tom Wolf will convert three options in the plan by former Gov. Tom Corbett into one. Corbett had used Medicaid dollars to buy private plans for some beneficiaries through the new private health plan marketplace created under the health care law.

Wolf said that Corbett’s plan was confusing, bureaucratic, created unnecessary hurdles for people, and created glitches that resulted in the delay of care for some people.

“Today is the first step toward simplifying a complicated process and ensuring hundreds of thousands of Pennsylvanians have greater access to the health insurance they need,” said Wolf. “Our approach will alleviate confusion, remove unnecessary red tape, and streamline the system so that people can see a doctor when they are sick and health care professionals have more time to concentrate on providing quality care.”

The Medicaid agency is also working with the commonwealth’s health care providers and hospitals to shift people enrolled in Corbett’s private coverage option into a traditional Medicaid expansion. The agency said the transition will occur over a longer period of time to ensure that individuals are clearly informed of these changes and they do not experience any gap in coverage. 

“We are committed to ensuring an orderly and efficient transition for every Pennsylvanian receiving health care coverage through the commonwealth,” said Department of Human Services Acting Secretary Ted Dallas. “We are already at work making changes to our eligibility systems that will take effect this spring. This will enable us to transition individuals participating in the General Assistance and SelectPlan programs to the new health plan.” 

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Higher Share of Marketplace Plans Charging Patients Higher Fees for Certain Drugs, Study Finds

By Melanie Zanona, CQ Roll Call

February 11, 2015 -- More health insurance plans on the exchanges are placing drugs to treat complex diseases at the highest cost-sharing tier in 2015 when compared to the previous year, according to a new analysis from the Avalere Health consulting firm.

“Enrolling in a plan that places all medications for a particular disease on the specialty tier can mean significant out-of-pocket costs for consumers, particularly if they do not qualify for cost sharing reductions,” said Caroline Pearson, vice president at Avalere, in a press release. “Plans that place some drugs in a class on lower tiers may allow consumers to find lower cost alternatives.”

Avalere found that some plans placed all of the drugs within five classes of medication on the specialty drug tier—which could mean higher coinsurance and costs for patients. The medications included those to treat multiple sclerosis, two classes of drugs to treat HIV/AIDS, and two classes of cancer drugs.

The report shows that 51 percent of exchange plans put all multiple sclerosis agents, including generics, in the highest tier in 2015, up from 42 percent in 2014. Meanwhile, 29 percent of plans——nearly double the amount in the previous year—placed protease inhibitors and available generics used for HIV/AIDS patients on the specialty tier, compared to 16 percent in 2014.

Oncology’s antiangiogenics was the only class of drugs to see a slight dip in 2015, but still remains high with 60 percent of plans placing all the medications in the top tier. The study notes that there are no generics for these cancer drugs or two other classes of drugs identified in the report.

Some patient advocacy groups seized on the new information, which they maintain is a trend that started among plans in 2014 and grew this year.

“We believe some insurers are purposefully designing plans in such a way that discourages patients, particularly those with chronic health care conditions, from signing up for them,” said Carl Schmid, deputy executive director of the AIDS Institute. “This is clear discrimination and a violation of the Affordable Care Act.”

Kevin Counihan, the CEO of the federal marketplace, said on a call with reporters that he had not yet seen the Avalere report but intended to read it soon.

The AIDS Institute is urging the federal government to enforce non-discrimination provisions in the 2010 health care overhaul by making medications more affordable to all patients and providing a clear picture of what exchange plans in 2016 will look like for patients.

But Avalere noted that the total cost impact to a patient varies on multiple factors, including subsidies, out-of-pocket limits, and overall plan benefit design.

“Plans continue to innovate on benefit design in the exchange markets,” said Dan Mendelson, CEO of Avalere, in a press release. “These designs are calibrated to optimize enrollment by delivering low and stable premiums—the primary metric that consumers use to select a plan.”

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Cost-Sharing Subsidies Make Marketplace Coverage Affordable, Study Says

By Rebecca Adams, CQ Roll Call

February 11, 2015 -- Certain federal subsidies for purchasing health insurance, now under review by the Supreme Court, are making products sold in the new marketplaces much more affordable for many consumers, according to a new analysis by the nonpartisan Kaiser Family Foundation.

Those subsidies lowered the average maximum amount that a consumer would have to pay out of pocket for a silver plan from $5,826 for a single person to $881 for someone whose income is 150 percent of the federal poverty level or less, according to a Kaiser report released Wednesday. The subsidies could be struck down due to a challenge to the 2010 health law. In considering the King v. Burwell case, the Supreme Court is looking at subsidies for states that rely on the federal marketplace to enroll people. The court case will be heard on March 4 and a ruling is expected by late June.

The health care law has two types of subsidies, and the court could rule that both are not allowed under the law. One subsidy lowers monthly premiums for people with income that is 400 percent of the federal poverty level or less. Another, for people with 250 percent of the poverty level or less, reduces out-of-pocket costs, such as copays, deductibles, and other cost-sharing.

The Kaiser analysis examined the cost-sharing subsidies in silver plans for lower-income people in states that use The subsidies slashed the average annual deductible for medical and drug coverage from $2,556 for a single person to $737 for people with income between 150 percent of poverty and 200 percent of poverty, and to $229 for people with income below 150 percent of poverty.

The poverty level for marketplace coverage this year is $11,670 for an individual.

The subsidies are particularly helpful for people who are sick and have high medical costs.

Insurers have a lot of flexibility in setting copayments, deductibles, and other cost-sharing. All of the plans at a certain metal level have to have the same overall actuarial value, with silver plans covering 70 percent of costs, for example. However, even plans offered in the same state and at the same metal level of coverage could have vastly different cost-sharing, as long as the overall value of the costs that are covered meets the guidelines.

The average copay amount for a primary care visit is $28 for standard silver plans. For people with income between 200 percent of poverty and 250 percent of poverty, the average copay drops to $23. People with income between 150 percent of poverty and 200 percent of poverty pay an average of $17 per visit, and those with income at 150 percent of poverty or below pay an average of $14 per primary care visit.

The subsidies “can result in thousands of dollars of savings for individuals and families who have significant medical events or ongoing medical needs,” said the analysis.

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CMS Changes Rating System for Nursing Homes

By Rebecca Adams, CQ Roll Call

February 12, 2015 -- Medicare officials announced Thursday that they will overhaul the quality rating system for nursing homes and the federal website that compares the facilities.

Nursing home industry lobbyists were worried that Centers for Medicare and Medicaid Services (CMS) officials would change the way that the quality of care was measured. Those concerns were validated by the announcement.

“The changes in ratings reflect that CMS raised the bar for performance that should be recognized as high quality and anticipates nursing homes will make quality improvements to achieve these higher standards,” CMS officials said in a statement. “However, the changes in the quality measures star ratings released in February do not necessarily indicate a change in the quality of care provided.”

The nursing home industry said that the public may not realize that the scores are being calculated in a new, more demanding way, and will mistakenly believe that a nursing home’s quality has dropped suddenly.

“We are concerned the public won’t know what to make of these new rankings,” said Mark Parkinson, President and CEO of the American Health Care Association, a trade association.  “If centers across the country start losing star ratings overnight, it sends a signal to families and residents that quality is on the decline when in fact it has improved in a meaningful way.”

The Obama administration wants to reduce the inappropriate use of antipsychotic drugs, so the agency is adding a quality measure that tracks the use of the drugs for residents who stay in a facility for a short period of time, and another that tracks the use for long-term residents. CMS officials said on a call with nursing home operators that the homes would not be penalized for giving a short-term patient the drugs if the person came in using the drugs under a doctor’s direction, but that the administration would not want to see a greater use of the drug after the person is admitted. Patients with a need for the drugs, such as those diagnosed with schizophrenia, Huntington’s disease, or Tourette syndrome, are excluded.

Medicare officials also are making it harder for nursing homes to win the highest ratings on a five-star scale. The overall rating is based on a formula, and nursing homes will have to get a higher number of points on that formula than in the past to maintain high overall scores.

Nursing homes also will have to meet new standards on their staffing levels. Operators of some nursing homes have been accused of trying to game the system. Under the new system, nursing homes have to earn a high rating on one of the staffing measures and must get at least a 3-star rating on all of the staffing level ratings in order to  win an overall rating of 4 stars or better.

The Nursing Home Compare website is one of several web pages that CMS officials administer in order to give the public a comparison of the quality of different institutions. The five-star quality rating system was added in 2008. The Nursing Home Compare website gets more than 1.4 million visitors per year, according to CMS officials.

The changes were announced in a public call on Thursday and in a statement.

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Medicare Launches New Payment Model for Cancer Care

By Rebecca Adams, CQ Roll Call

February 12, 2015 -- Medicare cancer patients will have access to 24-hour care under a new episode-based payment model announced by the Centers for Medicare and Medicaid Services (CMS).

Physicians that provide cancer treatment who want to participate in the coordinated care initiative must apply by April 23.

Medical professionals who are part of the program will have to meet performance standards and share information more broadly with other providers in order to coordinate care, said CMS officials in a press release.

The new initiative comes after Health and Human Services Secretary Sylvia Mathews Burwell announced on Jan. 26 that the agency wants to link 30 percent of traditional, fee-for-service Medicare payments to quality or value through alternative payment models such as accountable care organizations or bundled payment arrangements by the end of 2016. 

The oncology program is the second specialty care model that CMS developed. The agency previously announced that it would use a different payment model with enhanced care for people with end stage renal disease.

CMS is hoping that other payers also will adopt the model “to leverage the opportunity to transform care for oncology patients across a broader population,” said officials in the press release. Insurers and state officials that want to be part of the program should send a letter by March 19.

Physician practices will get two types of payments: monthly care management payments for each Medicare fee-for-service beneficiary cared for during a six-month episode and performance payments.

The monthly care management payments are $160 per patient.

CMS also will track how physicians perform on a number of quality measures, which will be used to determine the performance-based payments. Physicians will be rewarded if they lower costs and improve the quality of care over each six month episode of care.

To be eligible to participate, physicians have to use an electronic health record certified by the Office of the National Coordinator and attest that they meet the requirements of the second stage of so-called meaningful use health IT rules by the end of the third performance year.

The payments would cover all Medicare Part A inpatient and Part B outpatient care that patients get, as well as some prescription drugs. The monthly management fee will end if patients go into hospice end-of-life care.

Oncologists were somewhat disappointed. The American Society of Clinical Oncology (ASCO) has developed its own model. Oncologists said that the six-month period was arbitrary. Their model bases a monthly payment on the phase of treatment a patient is in.

Other key differences between the new CMS model and the oncologists' proposal are that ASCO’s plan would give physicians more flexibility to pay for services that wouldn’t be covered under the CMS plan. ASCO officials also said that oncologists would be held accountable for all of the patients’ care under the administration’s plan, while under the ASCO proposed model, oncologists would not be penalized if a different provider didn’t perform well. The oncologists’ association also said that payments under the CMS proposal would differentiate patients only by the type of cancer they have, while under the ASCO plan, payments would be adjusted by the complexity of the case and the toxicity of the treatment.

“While CMS is to be commended for seeking new approaches to payment, we are disappointed they have chosen to pursue only one model—and one that continues to rely on a broken fee-for-service system,” said Richard Schilsky, Chief Medical Officer of the American Society of Clinical Oncology.  “ASCO looks forward to working with both public and private payers to explore new payment strategies that better reflect modern oncology practice and support high value, patient centered care.”

The American Cancer Society applauded the administration’s action.

The effort "holds the potential to advance cancer treatment and the coordination of care,” said American Cancer Society Cancer Action Network President Chris Hansen. “The model will leverage the growing adoption of patient-centered care system-wide, with a critical emphasis on shared decision-making, advanced care planning, participation in clinical trials, outcomes measurement and other essential improvements in health care delivery that could save more lives from cancer.”

More than 1.6 million Americans are diagnosed with cancer each year, and most of them are covered by Medicare.

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