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May 4, 2015

Washington Health Policy Week in Review Archive b02db95c-4f37-4a38-95ea-d0290899ba78

Newsletter Article


Study Finds Gains for Hospitals in Medicaid Expansion States

By Marissa Evans, CQ Roll Call

April 30, 2015 -- Hospitals in the nation's largest non-profit health care system are seeing fewer uninsured patients in states that expanded Medicaid and are bringing in enough revenue to cover the cost of treating poor patients, according to a Kaiser Family Foundation report.

The Ascension Health system hospitals saw a 32 percent drop in uninsured patient visits in states that expanded Medicaid under the federal health care law, compared to just a 4 percent decline in non-expansion states, according to the report released last week. Medicaid is the joint federal-state insurance program for the poor and disabled. 

The report focuses on Ascension, the largest non-profit health system in the U.S., with 131 acute-care hospitals and more than 30 senior care facilities in 23 states and the District of Columbia, where it is based. The report looks at the hospital's progress over the last three quarters of 2013 to Sept. 30, 2014.

Ascension hospitals in expansion states saw an 8.2 percent bump in Medicaid revenue from 2013 to 2014 and a 63.2 percent decrease in revenue from non-Medicaid families paying a predetermined amount out of pocket before being eligible for the program, also known as self-pay. Meanwhile, hospitals in non-expansion states experienced a 9.4 percent drop in Medicaid revenue over the same period and only a 2.6 percent increase in revenue from self-pay.

Charity care costs fell 40 percent among hospitals in Medicaid expansion states compared to 6.2 percent in non-expansion states, according to the report. While hospitals saw the gap between what Medicaid pays and the cost of treating low-income patients increase 31.9 percent in expansion states the increase in revenue helped. According to Kaiser, state cuts for provider reimbursement rates for hospitals operating in non-expansion states may have increased shortfalls but there was no sizeable increase in Medicaid revenue to offset this. 

Kaiser's report comes as lawmakers in Alaska, Florida, Kansas, and Utah continue weighing Medicaid expansion in their states. Montana, pending negotiations with the U.S. Department of Health and Human Services, became the 29th state to expand its program this week.

Under the 2010 health care law, states can accept federal funds to expand Medicaid eligibility to people with incomes at or below 138 percent of the federal poverty level. The federal government pays 100 percent of the cost until 2016, when the U.S. subsidy begins to decline, falling to 90 percent by 2020. Republican-led legislatures have said they are skeptical about expansion due to potential costs and fear that the federal government will discontinue funding.

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'Family Glitch' Puts 1.9 Million CHIP Kids at Risk

By Marissa Evans, CQ Roll Call 

April 29, 2015 -- When Congress reauthorized federal funding for the state-managed Children's Health Insurance Program (CHIP) for two years in April, it did not address a so-called family glitch that could jeopardize coverage for nearly 2 million children, according to state CHIP directors and children's health advocates.

As funding for the program expires in 2017, families of children now getting health insurance through CHIP will have find policies on the state and federal marketplaces established by the Affordable Care Act.

That's where the family glitch comes into play. The glitch is a faulty benchmark under the federal health law that bases the affordability of health plans for families on the cost of coverage for individuals. The cost of a family plan is typically more expensive than individual coverage—but the law didn't set parameters for the affordability of family plans. That means many families can't afford the coverage or qualify for subsidies to help them pay for it, which could cause up to 1.9 million CHIP children to lose coverage altogether, according to the Government Accountability Office.

"The family glitch would have to be fixed soon, and that has been challenging to try to do," said Elisabeth Wright Burak, senior program director for Georgetown University's Center for Children and Families. "It's hard to imagine with the politics of the [Affordable Care Act] and the presidential elections that that's going to be fixed."

Iowa Republican Sen. Charles E. Grassley said in an emailed statement that Congress needs to examine the insurance plans offered on the exchange and by employers to see "what should be provided to near-Medicaid income kids and what role CHIP or its successor will play in providing care."

"While the family glitch is important, it speaks to the larger review of the role of CHIP that must be discussed in the next two years," Grassley said in the statement.

CHIP was implemented in 1997 to provide health coverage to children in families earning between 200 percent and 300 percent of the federal poverty level—too much money to qualify for Medicaid but typically not enough to afford private insurance plans. Before the 2010 federal health law, Medicaid in most states covered families making up to 100 percent of the federal poverty line. In 2013, 8.1 million kids were covered under CHIP at a cost of $13 billion.

In the two years before CHIP's funding authorization expires, the programs' directors and child health advocates will try to find ways to integrate the program's beneficiaries into the state and federal insurance exchanges, according to Trish Riley, executive director for the National Academy for State Health Policy. She said one of the issues to be addressed is that private insurer plans today aren't as extensive as CHIP and Medicaid plans. 

"Private insurers have kids' plans, but low-income kids have typically been under the jurisdictions of Medicaid and CHIP," Riley said. "When you take kids that have more needs or complex needs you might have to think of other strategies." 

Riley said that since insurers have shown themselves to be flexible with plans offered on the exchanges, she hopes they would be open to changes to their children's plans. 

A February GAO report cited a survey that found CHIP enrollees have comparable coverage and access to services as privately insured children. The survey also found that parents of children enrolled in CHIP experienced less financial burden in paying their children's medical bills. 

But in the same report the agency wrote that "several states raised concerns about negative implications for children's coverage if CHIP funding is not reauthorized, including concerns that their states would lose gains made in covering children, who would also lose access to providers and dental care." 

In Louisiana, for example, Jeff Reynolds, undersecretary for the Department of Health and Hospitals, said the state's CHIP program is receiving an additional $36.7 million to help it "maintain the level of service we're at right now." He said the program is taking a wait-and-see approach over what the federal government will recommend if CHIP isn't reauthorized beyond 2017. 

In West Virginia, with 28,700 children in the state's CHIP and Medicaid programs, a survey found that more than two-thirds of participating families say that they didn't think they could afford more than $50 per month for premiums if they were moved to the federal marketplace, according to Sharon Carte, executive director for West Virginia CHIP.

And, she said, two years won't be enough time to figure out a solution for those families.

Insurance commissioners typically set rates six months prior to enrollment periods, she said, which would require Congress to find a fix for the family glitch by next year in order to help CHIP beneficiaries transition to the exchanges. She said that that's unlikely.

Congress "did a straight extension without addressing any issues," Carte said. "I could see two years going by and we could be in the same position if no changes are made."  

Further complicating a congressional response to the glitch is that lawmakers can't do much until after the King v. Burwell Supreme Court decision in June, according to Doug Holtz-Eakin, president of the American Action Forum. 

The case examines whether the federal health law can give subsidies to residents of the 34 states that didn't set up health insurance marketplaces, opting instead to use the federal marketplace. An estimated 13.4 million people could lose the subsidies if the court strikes them down, according to a Kaiser Family Foundation analysis. 

Holtz-Eakin said if the court strikes down the subsidies it could clarify how Republicans move forward with making changes to the federal health care law and how to address the family glitch in CHIP. 

"It's hard to have a strategy for CHIP in isolation because you don't know yet what problems you're fixing," Holtz-Eakin said. "The CHIP program was an extremely bipartisan effort, and to have the program missing some of the target population is not something I think Republicans would sit idly by and watch." 

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Medicare Opens Trove of Drug Spending Data

By Rebecca Adams, CQ Roll Call

April 30, 2015 -- All of the 10 most commonly prescribed drugs in 2013 were generic drugs, according to a Centers for Medicare and Medicaid Services (CMS) analysis of data that federal officials recently released for public analysis.

The heartburn relief drug Nexium and the drug Advair Diskus, used to control asthma and chronic obstructive pulmonary disease, captured the most drug revenues that year. Neurologists prescribed drugs that resulted in far higher costs per claim than internists, family practice doctors or psychiatrists.

The findings are representative of what can be harvested from a massive database of Medicare prescription drug claims—with 23 million lines of information about 1 million different medical providers—that CMS officials opened up to the public last week. 

CMS has already released other data sets with information about physicians' claims, hospital charges, and payments from drug companies to doctors or researchers.

"It's important for consumers, their providers, researchers, and other stakeholders to know how many prescription drugs are prescribed and how much they cost the health care system, so that they can better understand how the Medicare Part D program delivers care," said CMS Acting Administrator Andy Slavitt in announcing the availability of the new data. 

The information could answer more questions about how often doctors prescribe certain drugs and how much they cost, how drug use varies across the country and how often physicians prescribe brand-name drugs instead of generics. 

The providers are identified but patients are not in the data set. The new data show the patterns of doctors or other health care providers who altogether prescribed about $103 billion in prescription drugs and supplies through the Medicare prescription drug program. 

The data shows the prescribing patterns of health providers for more than 3,000 drugs. Federal officials plan to release new numbers every year. 

CMS Deputy Administrator Sean Cavanaugh said that federal officials rely on the data as they wrestle with policy questions about Medicare prescription drug spending, but said that the data are large and diverse enough that outside analysts "may develop insights we may have missed." He also said that the public disclosure of drug spending could "help energize the private sector" to find efficiencies and improve federal programs. 

Niall Brennan, Director of the CMS Office of Enterprise Data and Analytics and Chief Data Officer, called the release another step in making big data available to the public. 

The information that the public can now see includes the total number of prescriptions that a doctor prescribed for each type of drug. That includes original prescriptions and any refills, and the total drug cost paid by beneficiaries, health plans, and other payers.

The data set is based on information about drug spending for 35.7 million beneficiaries enrolled in the Medicare Part D prescription drug program, who make up about 68 percent of the people in Medicare. About 23 million of the beneficiaries are in stand-alone prescription drug plans and 13 million are in Medicare Advantage private health insurance plans that cover prescription drugs.

"We believe sharing this data is the right thing to do," said Cavanaugh.

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Insurers Dodge Obamacare Women's Health Mandates, Study Finds

By Melanie Zanona, CQ Roll Call

April 29, 2015 -- Some insurers are dodging women's health coverage requirements in Affordable Care Act, according to a new report, but advocates stopped short of calling for new laws to bring those health plans into compliance.

The National Women's Law Center (NWLC) recently said it found almost half of the plans it studied were in some way violating a provision in the health care overhaul requiring insurers to cover women's preventive services without cost sharing. The group examined the practices of 120 issuers across 15 states on such services as birth control, well-woman exams, or breastfeeding supports and supplies. 

The review found 14 plans were not covering maternity care and other health services for dependents, as required by law. One of the more popular provisions of the overhaul was allowing children to stay on their parents' insurance until they are 26.

"The promise of the ACA has not become a reality for all women in this country," said Gretchen Borchelt, the group's vice president for health reproductive rights, referring to the Affordable Care Act. "There is a range of violations as it relates to women's health coverage."

The health law also prohibits insurers from designing plans that discriminate based on age, sex, gender, or race. But NWLC found nearly 100 violations, from failure to provide coverage for transgender people to only covering prenatal medications for women under 42 and contraception for women under 50.

When it comes to the law's birth control mandate, the study found numerous instances of non-compliance, a trend supported by other recent reviews. Even though most private insurers must cover all Food and Drug Administration–approved forms of contraception at no cost, some plans were requiring a copayment, while others limited the methods they would cover.

"Any woman knows there is a big difference between taking the pill and getting an [intrauterine device]," said Sharon Levin, director of federal reproductive health policy for NWLC.

Some of the group's recommendations for bringing insurers into compliance include requiring more transparency from the plans during open enrollment and urging federal and state regulators to exhibit more oversight. The group also encourages consumers to work with advocates when they run into coverage barriers, because the organization said it has seen some success with insurers voluntarily changing their plans.

"We don't need federal legislation, there is already a federal law," Levin said. "We need administration action and regulation to make sure it's implemented correctly."

Washington Democrat Patty Murray, ranking member of the Senate Health, Education, Labor, and Pensions Committee and a champion of women's health issues, sent a letter earlier this week to certain insurance plans in her state over their failure to cover numerous forms of contraception and provide women with accurate information about the services available under the health law.

"I request an update in writing on your steps to correct these issues for women across Washington State immediately," she wrote.

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Institute of Medicine Sees Name Change

By CQ HealthBeat Staff

April 28, 2015 -- The National Academy of Sciences has voted to change the name of the Institute of Medicine to the National Academy of Medicine effective July 1 as part of broader internal reorganization.

The newly named entity will continue to be an honorific society and inherit more than 1,900 current elected members and foreign associates of the IOM. It joins the National Academy of Sciences and National Academy of Engineering in advising the nation on matters of science, technology, and health.

Officials said the change was part of efforts to more effectively integrate the work of the National Academies of Sciences, Engineering, and Medicine. Reports and studies on health and medicine will continue to appear as activities of the Institute of Medicine, which will become one of the six program units operating under the direction of the integrated academies.

"The establishment of the National Academy of Medicine is a significant milestone in our history," said National Academy of Sciences President Ralph J. Cicerone. "It is an acknowledgement of the importance of medicine and related health sciences to today's global research enterprise. It will also better align us to take a more integrated, multidisciplinary approach to our work, reflecting how science is best done today."

The vote was taken at the 152nd annual meeting of the National Academy, which was founded in 1863 under a congressional charter signed by President Abraham Lincoln.

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