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October 26, 2015

Washington Health Policy Week in Review Archive 4edef2d6-9c5c-4f1f-850a-2df28da155f8

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Federal Officials Outline New Features

By Melissa Attias, CQ Roll Call

October 23, 2015 -- Consumers in 38 states will have the ability beginning Sunday to window shop for health coverage on the federal marketplace website, which will include a new feature to estimate their total out-of-pocket costs.

But federal officials aren't guaranteeing that new tools will be ready so consumers can easily search for plans on that cover their doctors and prescription drugs when the third open enrollment period begins Nov. 1.

Lori Lodes, communications director for the Centers for Medicare and Medicaid Services (CMS), said federal officials currently have a little over half of the data validated from insurance companies for these website tools to work, and they "need that to be better." She cited complications from drugs being listed multiple times and doctors having multiple offices.

"We want to make sure that we are getting consumers the best experience and have the right information," Lodes told reporters at a briefing. "When we're confident in the data, the information that they're getting, that's when we're going to release it."

She also noted that consumers will still be able to go to the insurer's provider directory to find that information without having the new feature in place. When it's ready, she said, the information will be built into the platform rather than having to go to a third-party source.

CMS Acting Administrator Andy Slavitt, appearing via webcam at the briefing, said that officials have continued to improve the site for the third open enrollment period based on consumer feedback. He said the response time on the website will be 40 percent faster this year and that is monitoring health plan websites daily so it has the latest information about providers.

"As issues arise, as they inevitably will, we will as we have in the past work through them, keeping consumers our primary focus," Slavitt said.

The third open enrollment period for the insurance exchanges set up through the Affordable Care Act runs from Nov. 1 until Jan. 31. Slavitt said the focus will be on retaining current customers, boosting new enrollment and improving the experience for consumers.

New Features

Kevin Counihan, CEO of the health insurance marketplaces at CMS, touted the new out-of-pocket cost calculator as a "key tool to really help educate people on the plans that they're picking." The feature provides users with an estimate of premiums, co-pays and deductibles after they select whether they expect low, medium or high utilization of health services for each individual on the plan.

"They're going to make better choices, they're going to have fewer surprises, fewer calls to the call center—a better user experience," Counihan said.

Officials said the new calculator and the provider and prescription drug lookup tools will warn consumers that the features are new. The site will recommend that consumers call their providers and health plans to confirm the information.

Lodes also said the updated website will tailor information to whether an individual is a returning customer or signing up for the first time, citing past confusion because information focused on first-time applicants.

Consumers who return to the site to re-enroll will no longer have to enter a 14-digit identification code, she said, because the site will have the plan automatically saved for them.

Another feature will present individuals with a screen outlining how much financial help they qualify for and other eligibility information as soon as they complete an application. Under the old system, about 1 in 4 people who applied for coverage did not click on the PDF file that showed those details, Lodes noted. also will remind individuals to re-enter their Social Security number if the system has trouble matching their data, as officials found some people weren't entering that information or were keying it in incorrectly.

Counihan said CMS cut the number of internal system errors generated during normal processing by 50 percent compared to last year. The agency also replaced the back end of the system that consumers use to create accounts and log in, which he said will make the site faster and more stable so that more visitors can be on the site at the same time.

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Medicare Premium Hike Could Add Spice to Year-End Budget Deal

By Melissa Attias, CQ Roll Call

October 20, 2015 -- Congressional efforts to block a looming premium spike for millions of Medicare beneficiaries could add upwards of $10 billion to the cost of a budget deal but also provide powerful incentives for lawmakers to throw their weight behind an agreement.

An estimated 16.5 million seniors, or 30 percent of enrollees in Medicare Part B, are expected to see their monthly premiums for doctors' visits and outpatient services rise by at least $54 in 2016. The remainder are protected by a "hold harmless" provision preventing Part B premiums from rising more than their Social Security paychecks.

House and Senate Democrats proposed forestalling the increase with legislation (S 2148, HR 3696) before the Columbus Day recess that would freeze premiums for all beneficiaries and limit other out-of-pocket costs. The seniors lobby group AARP also joined in last week, urging lawmakers to step in.

But Republicans so far have declined to outline their own approach, and may remain quiet until the Obama administration formally announces final premium rates in the coming weeks. That wait, combined with the uncertain state of House GOP leadership and fiscal conservatives' likely insistence on offsetting cuts to pay for the premium fix, make it likely that any compromise would get wrapped up into a year-end budget deal.

"I think that's the way a lot of this stuff is going to get done at this point," Rep. Dina Titus of Nevada, the sponsor of the Democrats' House bill, said in an interview. "That's fine with me as long as it gets in somewhere."

Including a premium fix in the package could assuage wavering lawmakers concerned about other health program cuts that could be included in a budget package that eases discretionary spending caps.

The premium increase would fall on new Medicare enrollees, those who do not receive Social Security checks and higher-income beneficiaries. But the biggest constituency—about 9 million people, according to the AARP—are low-income seniors enrolled in both Medicare and Medicaid who have their premiums paid by the states.

The National Association of Medicaid Directors noted in a letter to congressional leaders that the state share of Medicaid is expected to rise by more than $2 billion next year if the premium spike occurs.

Partial Fix

An aide to Speaker John A. Boehner said House Minority Leader Nancy Pelosi and her staff have spoken to the Ohio Republican and his staff about the premium spike and that work is continuing on the issue. Boehner's staff has also indicated that the cost of blocking the increase would have to be offset, the aide noted.

Aaron Fobes, a spokesman for Senate Finance Chairman Orrin G. Hatch of Utah, said his boss "looks forward to finding a fiscally responsible path forward on this problem that can pass both houses of Congress."

Insistence on an offset may prompt lawmakers to decide on a partial fix that would limit how much premiums would rise and reduce the projected cost from about $10 billion to $7.5 billion according to unofficial estimates from advocates, though the true price tag will depend on the final premium rates.

The 2015 Medicare trustees report estimated that the premium rate for affected enrollees, absent congressional action, would rise from the current $104.90 per month to $159.30 per month in 2016. A partial fix would mean the enrollees would pay $120.70.

"The obvious advantage of the approach that allows a small increase but avoids the very large one is that it's much less expensive," said Paul Van de Water, senior fellow at the liberal-leaning Center on Budget and Policy Priorities.

Another tactic could involve protecting certain categories of beneficiaries from the premium spike—leaving the increase for high-income beneficiaries, for example—though that could present political complications. Lawmakers could also try to find some sort of permanent solution, though many observers think Congress likely only has the bandwidth for a short-term fix.

Whatever lawmakers settle on, Robert Moffit of the conservative Heritage Foundation is urging them to fully offset the cost rather than repeat the approach they took replacing Medicare's physician payment formula earlier this year (PL 114-10). He wants to see changes that would begin to improve Medicare's long-term solvency, such as combining hospital and outpatient coverage into one deductible.

"This crisis is very, very manageable," Moffit said. "The issue is, do we want to use this as an opportunity to, number one, actually save the money that's necessary to save, and to use the opportunity to improve the program for once."

But Andrew Scholnick, senior legislative representative on AARP's federal health and family team, said changes to Medicare that increase cost-sharing for beneficiaries were already included as offsets to the physician payment package.

"It wouldn't be right to do it again this time around," Scholnick said.

One offset that's been floated is a proposal in President Barack Obama's budget to reduce Medicare reimbursements for physician-administered drugs, according to a source following the budget discussions. That's expected to save about $7.5 billion, the source noted, roughly equal to the expected cost of a partial fix.

Administrative Fix?

While advocates are pressing for congressional action, there is also some speculation that the Health and Human Services Department could adjust the premium increase when it releases final rates for next year.

Tricia Neuman, director of the Kaiser Family Foundation's Program on Medicaid Policy, said HHS Secretary Sylvia Mathews Burwell has the discretion to set premiums and deductibles, as long as premium revenues cover 25 percent of Part B spending and provide for adequate reserves. But the law does not define adequate reserves, she said, meaning the premium increase could be lower than the trustees projected.

"That's the area where there may be some flexibility, but there's only flexibility up to a point," Neuman said.

In the meantime, Democrats are continuing to press for quick action. House Minority Whip Steny H. Hoyer of Maryland said in a statement that he urges "House Republican leaders to come to the table to find a fiscally responsible solution to prevent these arbitrary spikes in premiums." And Illinois Democrat Jan Schakowsky maintained in a separate statement that "Republicans have yet to put forward any proposal and have been unwilling to even come to the table to negotiate."

Kevin Brady of Texas, chairman of the House Ways and Means Health Subcommittee, said before recess that his panel is monitoring and reviewing the issue and listening to members' concerns.

White House spokesman Josh Earnest told reporters that the Obama administration has spoken with members of Congress about the issue and its interest in resolving it. "I think the goal would be to try to alleviate the unintended burden on those Medicare recipients who will see a much higher premium next year," he said.

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Some States Leveraging Tribes for Medicaid Money

By Marissa Evans, CQ Roll Call

October 19, 2015 -- Lawmakers in some states mulling Medicaid expansion are tacking on a new stipulation: more money from the federal government to serve clients of the Indian Health Service.

Republican South Dakota Gov. Dennis Daugaard met with Department of Health and Human Services (HHS) officials last month to push the federal agency to pick up the full cost of serving Medicaid-eligible Indian Health Service (IHS) patients who go to non-IHS facilities.

Right now Medicaid, the joint federal-state health insurance program for the disadvantaged, pays for beneficiaries who are also eligible for IHS services but are forced to go outside of the IHS network for care. State and federal governments share the cost.

Without a commitment by the federal government to pick up the full cost of supplementing IHS coverage, Daugaard "is not going to suggest Medicaid expansion," says South Dakota Secretary of Health Kim Malsam-Rysdon.

IHS patients get twice as much care outside IHS as they do within it, Malsam-Rysdon says. The state would use the money it saves from supplementing IHS care to support its Medicaid expansion plan, estimated to cost between $30 million and $33 million by 2020, she says. In fiscal 2014, South Dakota's Medicaid plan paid $133 million for care provided outside of IHS for Native Americans.

Under the 2010 health care overhaul, state Medicaid programs could be expanded to enrollees with incomes up to 138 percent of the federal poverty line. The full cost is covered by the federal government until 2020, when states that expanded will be responsible for chipping in 10 percent. Already participating in the expansion are 29 states and the District of Columbia. Montana is awaiting final approval of its expansion plan from HHS.

South Dakota wouldn't be the first state to try to tie IHS to its Medicaid expansion.

Alaska expanded its so-called Healthy Alaska Plan for 42,000 beneficiaries in September after HHS Secretary Sylvia M. Burwell had signed off on the state's request for the agency to pay the full cost for Medicaid-eligible Alaska Natives and American Indians receiving care in non-IHS facilities.

Alaska Gov. Bill Walker, an independent, said in his initial July 21 letter to Burwell that the change is expected to save the state about $158 million.

"Many Alaskans are working two or three jobs to make ends meet and have not been able to afford health insurance," Walker said in a Sept. 1 news release. "The Healthy Alaska Plan ensures that working Alaskans will no longer have to choose between health care and bankruptcy."

Matt Salo, executive director of the National Association of Medicaid Directors, said that for years states have lamented being financially on the hook when IHS clinics push patients to go to non-IHS facilities. When IHS patients have to go outside IHS for care they automatically become eligible for Medicaid. This means the state has to pay for a portion of their care. He said Alaska's recent success is a step in the right direction.

"It has always been a struggle for Medicaid to say we're happy to treat them," Salo said. "You can't have IHS either abdicate its responsibility or actively try to reduce its own cost by pushing folks out of its facilities."

State Sen. Troy Heinert, a Democrat in the South Dakota legislature, says he's been pushing Medicaid expansion for years, as many of the working poor and Native Americans "have fallen through the cracks."

Congress covers an estimated 60 percent of the health care needs of eligible American Indians and Alaska Natives, according to the IHS website. However, not all IHS facilities provide the same services. Patients are often sent outside of the reservation to receive care through contracted health service providers. But with limited funding, services and medications for non-life-threatening situations aren't always available.

Heinert says he's optimistic that Daugaard's negotiations with HHS and action by the legislature can make Medicaid expansion a reality. "We live in a pretty red state, and I don't think that we've always looked at things on the human level—we've looked at it fiscally first," Heinert says. "When it comes to things like Medicaid expansion, the human cost is greater than the fiscal cost from the data that we've seen."

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GOP Appropriators Take Aim at Little-Known Medical Agency

By Kerry Young, CQ Roll Call

October 23, 2015 -- House GOP appropriators' bid to shut down a little-known federal medical agency in fiscal 2016 likely will fail, but their consistent criticism of the Agency for Healthcare Research and Quality (ARHQ) may take a financial toll.

Appropriators last year curbed a budget practice that had transferred funds from the National Institutes of Health (NIH) and other agencies to the AHRQ, a move that compels the agency to compete more directly with other federal programs in the annual spending scrum.

The initial signs are that the agency isn't doing well. House Republican appropriators want to eliminate it. Senate GOP appropriators want to reduce its budget by about a third and even the White House asked for flat funding for the AHRQ's general operations in a request that proposed a 6 percent increase in total federal spending.

The AHRQ describes itself as the "nation's engine for improving the safety and quality" of health care. The staff pores over vast amounts of data for clues on how best to practice medicine, helping other agencies implement the lessons on such things as reducing falls or potentially deadly infections in hospitals. Health policy wonks see it as an unsung catalyst to improve medical practice.

But that advice can also earn powerful enemies as the agency questions the value of procedures or recommends changes that anger some in the $3 trillion industry. The AHRQ had a previous near death experience in the early 1990s. Unlike the NIH or Centers for Disease Control (CDC), the low-profile AHRQ doesn't become the centerpiece of Hollywood movies about researchers battling killer contagions.

"Our job is to try to make the other 99.99 percent of spending more effective," AHRQ Director Richard Kronick said in an interview with CQ Roll Call.

But critics say much of its work is duplicative.

House appropriators, led by Rep. Tom Cole, R-Okla., the chairman of the Labor-HHS-Education Appropriations panel, question whether the agency is needed at all, saying other federal medical programs are doing the same work. Cole has written provisions into the spending bill that would allow some AHRQ programs to move elsewhere in the Department of Health and Human Services if they aren't already replicated. He said he may be willing to preserve the agency if a budget deal lifts the spending caps for fiscal 2016.

"We think there is ample opportunity here to salvage what's appropriate, to get rid of some duplications here and to actually capture some savings that can be redirected," Cole said.

Cole is the third consecutive Labor-HHS-Education Appropriations chairman since Republicans regained control of the House in 2011 to back eliminating the AHRQ. He's the first, however, to get a bill as far as markup in the full committee. His predecessors, Denny Rehberg, R-Mont., in 2012 and Jack Kingston, R-Ga., in subsequent years, didn't even get that far.

"Anything that CDC or NIH or somebody else is doing, we are going to eliminate it," Kingston said in an interview this week. "Anything that no one else is doing, we are going to preserve it." He supported Cole's approach. "It's a pretty small step."

Powerful Supporters

The agency has fervent and powerful supporters among Democrats and Republicans. One of them is Sen. Barbara A. Mikulski, D-Md., ranking member of the Senate Appropriations Committee. But that hasn't prevented Senate appropriators from approving a bill (S 1695) that would cut the AHRQ discretionary budget to $236 million in fiscal 2016, a reduction of $128 million from fiscal 2015.

The Senate cuts would hit health services research programs particularly hard. The programs fund efforts to understand how people get access to medical care and how much it costs, and how well treatments provided work to preserve or restore patients' health.

Former Senate Majority Leader Bill Frist, R-Tenn., who is also a surgeon, contributed a column to Forbes magazine last month saying the agency's work makes American medicine safer and citing its contribution to preventing hospital-acquired infections as an example. 

Gail Wilensky, who led the agency now called the Centers for Medicare and Medicaid Services in the President George H.W. Bush administration, argued in a September article in the Journal of the American Medical Association that the AHRQ is vital for efforts to gain control of rising health expenses.

"Given the cost and the shortcomings of US health care, it shouldn't be difficult to recognize the need for an agency that focuses on strategies designed to advance evidenced-based treatments, to improve patient safety, to foster the use of health information technology in facilitating these goals, and to aid the dissemination of improved clinical care strategies," Wilensky wrote. "But apparently it is, as I've observed during the 40 years I have been in the field."

"AHRQ's work is, let's face it, boring—but no less important," said Joe Antos a researcher at the conservative American Enterprise Institute in a June blog post. "We may not be enthralled by a study of how to prevent hospital-based infections, but such studies can change the way health care is delivered on the ground—which can improve patient experience and reduce cost."

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House Sends Reconciliation Package to Senate

By Melissa Attias, CQ Roll Call

October 23, 2015 -- A reconciliation package that would scrap parts of the health care law and block federal funding for Planned Parenthood for one year is on its way to the Senate after House Republicans voted to advance it Friday.

The House passed the measure (HR 3762) 240-189, despite objections from the conservative group Heritage Action for America on the grounds it doesn't fully repeal the health law (PL 111-148, PL 111-152). Seven Republicans voted against the measure while one Democrat, Collin C. Peterson of Minnesota, voted for it.

The White House has already said that President Barack Obama will veto the package, but Republicans have been touting the use of the expedited budget process as a way to get legislation to his desk. Reconciliation allows a measure to advance through the Senate with a simple majority rather than the usual 60-vote requirement.

"I'm saddened that reconciliation is a word that folks have to go and look up and learn, but it is the only way, the only way in divided government that the people's voice can be heard," Rep. Rob Woodall, R-Ga., said on the House floor. "There is no other procedure in the United States Congress that allows 51 percent of America to prevail."

The package would strike the health law mandates on individuals to buy health coverage and on employers to offer it to workers or face penalties, as well as its taxes on medical devices and high-cost "Cadillac" employer-sponsored plans. It also would eliminate the law's fund for prevention and public health activities and a still-unenforced requirement for large employers to automatically enroll new full-time employees in coverage. Finally, it would defund Planned Parenthood for one year while providing more money to community health centers.

A provision that would have repealed the health law's Medicare cost-cutting board was removed from the package when the House adopted the rule governing floor debate (H Res 483). Budget Chairman Tom Price, R-Ga., said the move was intended to preserve the reconciliation bill's special fast-track status across the Capitol in response to feedback from the Senate parliamentarian.

Senate Majority Leader Mitch McConnell, R-Ky., has said the Senate plans to take up the legislation but the timing is unclear and it's expected to face hurdles.

GOP Sens. Mike Lee of Utah, Ted Cruz of Texas and Marco Rubio of Florida, the latter two of whom are presidential hopefuls, issued a statement Thursday announcing they will oppose the package if it "cannot be amended so that it fully repeals Obamacare pursuant to Senate rules." They said the House bill that only repeals pieces of the law "simply isn't good enough.

"Each of us campaigned on a promise to fully repeal Obamacare and a reconciliation bill is the best way to send such legislation to President Obama's desk," the trio wrote.

With a 54-vote majority, only three GOP senators can vote against the legislation for it to reach President Obama's desk if Democrats and the chamber's two independents all oppose it as expected. That leaves no room for other Republicans break ranks, including some who may be resistant because of the language targeting Planned Parenthood.

"Senator Collins opposes defunding Planned Parenthood  because it provides important family planning, cancer screening, and basic preventive health care services to millions of women across the country," Annie Clark, spokeswoman for Maine Republican Susan Collins, said in an email. "For many women, Planned Parenthood clinics provide the only health care services they receive and, in many states, community health clinics are not in a position to take over the high volume patients who would be harmed by ending funding."

Across the aisle, Democrats could also try to raise procedural challenges under a Senate rule named for the late Sen. Robert C. Byrd, D-W.Va., that puts limits on the use of reconciliation. If a senator raises a point of order that a provision violates the Byrd rule, 60 votes are required to overcome it.


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Business Groups' Poll Finds Public Upset with 'Cadillac Tax'

By Eliza Newlin Carney, CQ Roll Call

October 21, 2015 -- Business leaders stepped up their pressure on Congress to repeal the health care law's excise tax on high-cost employer plans, releasing a poll Wednesday concluding that most voters say the tax will "harm the quality of health care."

"There are many flaws with the Affordable Care Act, but I think the employee benefits tax is perhaps the most ironic of the flaws," said Joe Trauger, vice president of human resources policy for the National Association of Manufacturers. "The same law that makes employer-sponsored coverage more expensive imposes a tax on coverage because it's expensive. Clearly that's not good policy."

Trauger made his comments on a Wednesday press call with representatives from the Business Roundtable and the U.S. Chamber of Commerce to release the results of a voter survey on the tax. Popularly known as the "Cadillac tax" because it would impose a 40 percent excise tax on high-cost employer health plans, it was authorized by the law (PL 111-148, PL 111-152) as a way to control burgeoning health care costs.

The trade groups' survey found that 44 percent of voters are unable to correctly identify the tax, but also concluded that 48 percent of respondents said after learning about the tax that it should be repealed. The survey also found that nearly one in two voters–45 percent—say that their health care is "less affordable" than it was before the law's enactment.

The tax is not slated to take effect until 2018, but employers are already configuring their health offerings for 2016 and 2017, said Maria Ghazal, vice president and counsel for the Business Roundtable. If the tax winds up touching preventive care and employer-run wellness programs, she said, it will undermine efforts to prevent chronic disease and reduce health costs in the long run.

Employers do need to get a handle on rising costs, acknowledged Randy Johnson, the U.S. Chamber's senior vice president for labor, immigration and employee benefits. But he said there are other ways to cut costs than imposing what he called a "crazy" tax.

"It's a false choice to say that the only way to control costs on this is to have a 40 percent excise tax," said Johnson. "It's like throwing the baby out with the bathwater."

Defending The Tax

The Obama administration has defended the tax, and 101 economists from leading think tanks and universities wrote to Capitol Hill earlier this month to urge Congress "to take no action to weaken, delay or reduce the Cadillac tax unless it enacts an alternative tax change that would more effectively curtail cost growth."

But a strange-bedfellows coalition that includes labor organizations, insurance companies and some of the nation's largest employers, from Dow Chemical to General Motors and Wal-Mart, is lobbying aggressively against the tax.

Two coalitions are ginning up grassroots pressure on Capitol Hill—the business-led National Coalition on Benefits, and a diverse umbrella group known as the Alliance to Fight the 40, which includes labor leaders, insurers and Fortune 500 companies.

Bipartisan legislation to repeal the tax has been introduced in both chambers, and a budget reconciliation bill headed to the House floor as soon as this week would repeal several parts of the health care law, including the 40 percent excise tax on employer insurance plans. The latter is the most likely legislative vehicle for Congress to try to repeal the tax in the near term.

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