Under the Republican health bill, it’s up to states whether to dismantle key parts of the Affordable Care Act.
Red, or GOP-leaning, states are sure to be interested in rolling back the law’s coverage requirements and freeing insurers to charge people more when they have preexisting conditions.
As strange as it sounds, deep-blue, heavily Democratic states supportive of Obamacare, including California and New York, may be forced to do the same, according to experts, regulators and consumer advocates.
The American Health Care Act, which narrowly passed the House on Thursday and now heads to the Senate, would significantly cut the federal subsidies on which many Americans rely to buy coverage. Unless the legislation fails or changes substantially, many consumers across the country could see the amount they pay every year for premiums increase by thousands of dollars, making coverage effectively unaffordable.
Few, if any, states would be able to fund subsidies on their own. To keep insurers in the market and bring costs down, state leaders might feel compelled to seek exemptions from rules that require health plans to provide 10 “essential health benefits” and prohibit them from charging higher rates for sicker consumers. The new GOP health care bill would allow such waivers.
“With the skimpier subsidies, states are going to be under enormous pressure to apply for these waivers,” said Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms.
These opt-out provisions could accelerate the unraveling of Obamacare, even in places that fully embraced the landmark law.
“Certainly the Californias and New Yorks of the world will do what they can to hold onto the ACA protections. But when confronted with insurer exits and big price hikes, many states with the best of intentions may feel they have little choice but to get a waiver,” Corlette said.
The idea of opting out is unfathomable to many liberals who fought so hard to win the consumer protections in the Affordable Care Act. They’re hoping the Senate will dump the bill or, in its quest for more moderate votes, at least make the premium tax credits more generous or eliminate the waivers.
Republican leaders insist the current health law isn’t worth saving because it has left consumers with double-digit rate hikes, onerous deductibles and little or no competition in some states, as insurers exit the marketplaces.
Rep. Kevin Brady (R-Texas), chairman of the House Ways and Means committee, said the GOP health bill grants states the flexibility they need to remove the “crushing mandates” that have led to “Obamacare plans you don’t want and can’t afford.”
House Speaker Paul Ryan (R-Wis.) struck a similar note in urging his colleagues to pass the bill. “Let’s make it easier for people to afford their insurance. … Let’s return power from Washington to the states,” he said on the House floor Thursday.
Consumer advocates in North Carolina, Colorado and other states are taking the threat of waivers seriously.
“No state is safe from such a waiver,” said Brendan Riley, a health policy analyst at the North Carolina Justice Center, an advocacy group focused on economic and social issues.
North Carolina would be one of the states hit hardest by the House bill, according to an analysis by the left-leaning Center on Budget and Policy Priorities. The state’s average premiums and out-of-pocket costs would rise by $7,549 annually.
Nationally, the average tax credit for enrollees in the online marketplaces would be 41 percent lower under the American Health Care Act by 2022, according to a study by the Kaiser Family Foundation. (Kaiser Health News, which produces California Healthline, is an editorially independent program of the foundation.)
The GOP bill also ends the penalty for not having coverage, which experts say might increase premiums as fewer healthy people sign up, leaving health plans with a higher proportion of sick patients.
All this could put the focus back on which benefits are deemed essential in health insurance — an all-too-familiar battle in statehouses before the ACA set a nationwide standard.
The health law now requires all plans sold on the individual and small-group markets to cover the 10 essential health benefits, including hospitalization, prescription drugs and mental health treatment. It has made coverage more comprehensive and prevented insurers from selling bare-bones plans that had cheaper premiums but often exposed consumers to huge medical bills after they sought care.
Before the ACA, coverage for maternity care, prescription drugs and substance abuse treatment often wasn’t available. State lawmakers were hesitant to approve new benefit mandates for fear of raising premiums.
Washington state Insurance Commissioner Mike Kreidler, a Democrat, said he sees a political fight over benefits on the horizon if the GOP bill advances.
“I certainly think there’s going to be political pressure applied to make adjustments [in essential health benefits],” he said. “I’d be vociferously and violently opposed to those changes.”
Adela Flores-Brennan, executive director of the Colorado Consumer Health Initiative, said she too has faith that her state’s Democratic governor and insurance commissioner would uphold essential benefits and protections for people with preexisting conditions.
But she and other patient advocates said that resolve may be tested by the lack of competition in some areas, which insurers could use as a bargaining chip for more leeway on regulations.
For instance, Flores-Brennan noted that industry giant Anthem is the sole company on the state’s insurance exchange in 14 Colorado counties. She said she worries the company could threaten to pull out if the state doesn’t opt for weaker standards.
California would be loath to cut benefits. If you’re selling a policy to a young adult without maternity care, that’s nuts.
Even in California, a liberal bastion that enthusiastically implemented Obamacare, the law’s supporters are bracing for a fight over the waivers.
“As premiums go higher, it will create pressure on us to undercut the standards we have,” said Beth Capell, a lobbyist for the consumer advocacy group Health Access California.
In California, premiums and out-of-pocket costs would rise by $2,779, on average, under the House bill, according to the analysis by the Center on Budget and Policy Priorities.
“California policymakers will once again hear what we heard year after year before the ACA: ‘Some coverage is better than no coverage. More limited benefits are better than nothing,’” Capell said.
John Baackes, the chief executive of L.A. Care Health Plan, with about 26,000 enrollees in the California exchange, said state leaders would exhaust every other option before slashing coverage.
“California would be loath to cut benefits,” Baackes said. “If you’re selling a policy to a young adult without maternity care, that’s nuts.”
No matter the state, red or blue, experts anticipate vigorous debate over these waivers because consumer protections under Obamacare have become more popular.
Wisconsin Gov. Scott Walker, a Republican, experienced that firsthand last week when he suggested his state may opt out of the ACA’s preexisting condition rules — and then immediately backtracked amid strong opposition.
Michael Miller, director of strategic policy for Community Catalyst, a Boston-based national consumer group, said waiver requests won’t necessarily proceed “quietly even in the red states. … People have heart disease and cancer and asthma in those states, too.”
The lapse was discovered as by an OIG study designed to address concerns over whether hospitals are “gaming” a system in which it falls to the hospitals to report patient-infection rates.
Almost 100 hospitals reported suspicious data on dangerous infections to Medicare officials, but the agency did not follow up or examine any of the cases in depth, according to a report by the Health and Human Services inspector general’s office.
Most hospitals report how many infections strike patients during treatment, meaning the infections are likely contracted inside the facility. Each year, Medicare is supposed to review up to 200 cases in which hospitals report suspicious infection-tracking results.
The IG said Medicare should have done an in-depth review of 96 hospitals that submitted “aberrant data patterns” in 2013 and 2014. Such patterns could include a rapid change in results, improbably low infection rates or assertions that infections nearly always struck before patients arrived at the hospital.
The IG’s study, released Thursday, was designed to address concerns over whether hospitals are “gaming” a system in which it falls to the hospitals to report patient-infection rates and, in turn, the facilities can see a bonus or a penalty worth millions of dollars. The bonuses and penalties are part of Medicare’s Inpatient Quality Reporting program, which is meant to reward hospitals for low infection rates and give consumers access to the information at the agency’s Hospital Compare website.
The report zeroes in on a persistent concern about deadly infections that patients develop as a result of being in the hospital. A recent British Medical Journal report identified medical errors as the third-leading cause of death in the U.S. Hospital infections particularly threaten senior citizens with weakened immune systems.
Rigorous review of hospital-reported data is important to protect patients, said Lisa McGiffert, director of the Consumers Union’s Safe Patient Project.
“There’s a certain amount of blind faith that the hospitals are going to tell the truth,” McGiffert said. “It’s a bit much to expect that if they have a bad record they’re going to ’fess up to it.”
Yet there are no uniform standards for reviewing the data that hospitals report, said Dr. Peter Pronovost, senior vice president for patient safety and quality at Johns Hopkins Medicine.
“There are greater requirements for what a company says about a washing machine’s performance than there is for a hospital on quality of care, and this needs to change,” Pronovost said. “We require auditing of financial data, but we don’t require auditing of [health care] quality data, and what that implies is that dollars are more important than deaths.”
In 2015, Medicare and the Centers for Disease Control and Prevention issued a joint statement cautioning against efforts to manipulate the infection data. The report said CDC officials heard “anecdotal” reports of hospitals declining to test apparently infected patients — so there would be no infection to report. They also warned against overtesting, which helps hospitals assert that patients came into the hospital with a preexisting infection, thus avoiding a penalty.
In double-checking hospital-reported data from 2013 and 2014, Medicare reviewed the results from 400 randomly selected hospitals, about 10 percent of the nation’s more than 4,000 hospitals. Officials also examined the data from 49 “targeted” hospitals that had previously underreported infections or had a low score on a prior year’s review.
All told, only six hospitals failed the review, which included a look at patients’ medical records and tissue sample analyses. Those hospitals were subject to a 0.6 percent reduction in their Medicare payments. Medicare did not specify which six hospitals failed the data review, but it did identify dozens of hospitals that received a pay reduction based on their reports on the quality of care.
The new IG report recommended that Medicare “make better use of analytics to ensure the integrity of hospital-reported quality data.” A response letter from Centers for Medicare & Medicaid Services Administrator Seema Verma says Medicare concurs with the finding and will “continue to evaluate the use of better analytics … as feasible, based on [Medicare’s] operational capabilities.”
Questions about truth in reporting hospital infections have percolated for years, as reports have trickled out from states that double-check data.
In Colorado, one-third of the central-line infections that state reviewers found in 2012 were not reported to the state by hospitals, as required. Central lines are inserted into a patient’s vein to deliver nutrients, fluids or medicine. Two years later, though, reviewers found that only 2 percent of central-line infections were not reported.
In Connecticut, a 2010 analysis of three months of cases found that hospitals reported about half — 23 out of 48 — of the central-line infections that made patients sick. Reviewers took a second look in 2012 and found improved reporting — about a quarter of the cases were unreported, according to the state public health department.
New York state officials have a rigorous data-checking system that they described in a report on 2015 infection rates. In 2014, they targeted hospitals that were reporting low rates of infections and urged self-audits that found underreporting rates of nearly 11 percent.
Not all states double-check the data, though, which Pronovost said underscores the problem with data tracking the quality of health care. He said common oversight standards, like the accounting standards that apply to publicly traded corporations, would make sense in health care, given that patients make life-or-death decisions based on quality ratings assigned to hospitals.
“You’d think, given the stakes, you’d have more confidence that the data is reliable,” he said.
Proposed legislation in California would require hospitals and clinics to pay minimum wage to students who are completing the training hours necessary to become allied health professionals.
Narciso Lara, 36, was trying to support his family in Salinas as a forklift driver but didn’t see any opportunity for advancement. So last year, he enrolled in a community college program to become a radiologic technologist.
Now, Lara takes classes at Foothill College in Los Altos Hills, Calif., and gets hands-on training at a health clinic nearby. By the end of the 22-month program, he will have completed 1,850 clinical hours — all unpaid.
That could change under the terms of proposed state legislation that would require hospitals and clinics to pay minimum wage to Lara and other students who are completing the training hours necessary to become allied health professionals. The current minimum wage in California is $10.50 an hour for organizations with more than 25 employees, and it is scheduled to rise to $15 over the next five years.
The bill, AB 387, would cover an estimated 50,000 people training for jobs such as respiratory therapists, vocational nurses, dietitians and pharmacy technicians. It would not cover marriage and family therapists or psychologists.
The legislation, authored by state Assemblyman Tony Thurmond (D-Richmond) and sponsored by the powerful SEIU-United Healthcare Workers West union, would broaden the definition of “employer” to include hospitals and clinics that are supervising trainees in the allied health professions.
At the heart of the issue is whether the trainees should be considered students or employees. Perhaps counterintuitively, getting a paycheck could have unexpected consequences for the trainees.
Lara said he would love to be paid while going to school, because his wife, a dental therapist, is supporting him and their children right now. But he worries that if hospitals and clinics had to pay students, they might be less willing to offer them training slots, and then there would be nowhere to get the requisite clinical hours.
“If this bill passes, I don’t know what’s going to happen. It’s scary actually,” Lara said.
Supporters say the bill would make it easier for more low-income students and working adults to become allied health professionals. To get certified or licensed, students have to complete anywhere from 160 to 1,850 unpaid clinical hours. That may be an insurmountable barrier for many, according to SEIU-UHW, which represents about 37,000 allied health workers in California.
“We are really talking about choking off a lot of people getting into these jobs,” said Michael Borges, political coordinator for SEIU-UHW.
Borges also said the students deserve compensation for their work, which the union estimates is worth at least $200 million in wages each year. “These are real trainees doing real work that provides a real benefit for these sites,” he said.
But accrediting bodies and community colleges have expressed concern about the bill. One agency, the Joint Review Committee on Education in Radiologic Technology, wrote a letter to Assemblyman Thurmond saying that pay for students is “inconsistent” with its accreditation policies.
Hospitals argue that paying wages would be a financial burden for them, especially since they already fund and provide the training and supervision required. The California Hospital Association estimates that paying allied health trainees would cost anywhere from $1.5 million annually for small hospitals to $36 million for larger health systems. Statewide, that would likely add up to a lot more than what the union estimates.
“The ramifications are huge,” said Cathy Martin, vice president of workforce policy for the California Hospital Association.
In addition, the association argues that the trainees aren’t employees, but rather students who — by law — must be supervised by licensed health care workers.
“These are unlicensed individuals who cannot provide care to patients without direct supervision,” Martin said. “They are learning what they need to know to become that licensed professional.”
Cedars-Sinai Medical Center in Los Angeles would probably have to reduce its number of slots for such trainees were the bill to pass, the hospital’s CEO Thomas Priselac told Thurmond in a letter. Cedars would be required to pay the more than 220 occupational and physical therapists, laboratory scientists and others it trains each year. It would also have to provide them with workers’ compensation, health insurance and other employee benefits, Priselac noted.
“The effects of this significant decrease in capacity within the current training system would exacerbate existing allied health care workforce shortages and put the development of a strong and diverse pipeline of future caregivers in jeopardy,” Priselac wrote.
Rachelle Campbell, director of the Foothill College radiologic technology program that Lara attends, said that helping students financially is a great idea but that the proposed legislation would have too many negative impacts.
“If our hospitals have to pay our students, they are going to walk away,” she said. “All of our contracts say students are not employees.”
The Foothill College radiology technologist training program places students at Stanford Medical Center, Santa Clara Valley Medical Center and other hospitals and clinics in the Bay Area. The students are under one-on-one, direct supervision for their first three quarters. After that, they have slightly more autonomy, but the supervisor must be within earshot, Campbell said.
These are real trainees doing real work that provides a real benefit for these sites.
Another one of her students, Rick Li, said he had to take out a loan to go back to school. But he is convinced he will make that money back when he graduates. The San Jose resident said he knew from the outset that the unpaid clinical hours were part of becoming a radiologic technologist.
“We are not really working for free,” said Li, 29. “We are working for our education.”
Li said that as a student he can make mistakes and learn from them. “If we were making money, we would be seen as techs rather than students. And if we don’t perform an exam correctly, they are going to judge us more harshly,” he said.
But Mayte Paniagua, an SEIU member who supports the bill, said going back to school about 15 years ago to become a pharmacy technician was a huge burden. The single mother had to leave her paid clerical job to work the unpaid training hours.
“I ended up finishing my internship program, but unfortunately I went into debt,” she said. “It’s not fair for other people out there to struggle just to get a better-paying job in health care.”
Paniagua, who now works as a pharmacy tech at Pacifica Hospital of the Valley in Sun Valley, said there really isn’t much difference between being a trainee and an employee.
“Technically the [trainees] are working,” she said. “They are hands-on. That’s why these people should get paid.”
Despite vocal opposition from nearly every major constituency affected by the bill, the vote produced the opposite result.
The AARP called the health bill that House Republicans narrowly approved Thursday “deeply flawed” because it would weaken Medicare and lead to higher insurance premiums for older Americans.
The American Medical Association said it would undo health insurance coverage gains and hurt public health efforts to fight disease. The American Hospital Association said the bill would destroy Medicaid, the state-federal health insurance program for the poor that expanded mightily under the Affordable Care Act and buoyed hospitals’ bottom lines.
Normally, that would spell failure.
But in today’s Washington, despite vocal opposition from nearly every major constituency affected by the bill, the vote produced the opposite result. The chorus of nays was not enough to stop the Republican-controlled House from approving the American Health Care Act, which repeals many critical parts of Affordable Care Act — the 2010 law known as Obamacare that has dropped uninsured rates in the United States to historic lows but, despite its lofty name, did little to rein in rising health costs. The AHCA will now move to the Senate, where GOP senators are expected to demand many changes.
Republicans have promised to repeal Obamacare since the day it was passed with only Democrats voting for it and have been campaigning on that promise ever since. While the House voted to repeal the act more than 60 times under the Obama administration, Thursday’s vote was the first one that really counted because the GOP controls Congress and the White House.
Peter Kongstvedt, a Virginia health industry consultant, said some House Republicans are likely betting the Senate blocks their legislation from going forward. “Nobody wins with this vote — that’s the damnedest part,” he said. “It’s a shallow political statement.”
The vote was about health care, but it was a display of political theater, too. Representatives sent a message not to hospitals, doctors and patients but to President Donald Trump and his devoted followers who propelled the GOP to power.
“The president needed a win and so does House Speaker Paul Ryan,” said Jason Fichtner, a health care expert at the conservative Mercatus Center at George Mason University in Fairfax, Va. “With this vote, they can go back to their constituents and say they did something about Obamacare.”
That is, the 217 GOP House members who voted for the bill. Twenty voted no, joining 193 Democrats.
Trump’s team scored him a touchdown, but their run to the goal line wasn’t politically pretty:
The bill passed without an updated analysis of costs and benefits from the nonpartisan Congressional Budget Office, whose review in March came before the GOP added sweeteners to win over its conservatives and moderates.
Democrats passed Obamacare after a year of debate. The GOP spent almost two months hammering out its replacement plan.
Business groups — such as the drug and hospital industries — played no part in shaping the AHCA. The Obama administration got both groups on board early on.
The GOP’s focus was not so much on what can lower prices and increase health coverage but how to persuade the right-wing Freedom Caucus to back the legislation.
In the end, passage mattered less about how the bill played in public polls — poorly — or among key interest groups — nearly all opposed. “Coming to agreement and avoiding the embarrassment of not coming to agreement was more important than what was in the final bill,” said Jim Morone, a political scientist at Brown University in Rhode Island. “Republicans have become a deeply ideological party … and they don’t care what interest groups think; they are going to press ahead.”
Part of the unlikely victory is that the bill makes the biggest change to Medicaid since the program was established in 1965 and there hasn’t been as much debate about that as one might expect. The AHCA could lead to huge cuts in federal funding of Medicaid, which now covers more than 75 million Americans.
Alan Levine, a hospital executive who was the top health official under former Republican governors Jeb Bush in Florida and Bobby Jindal in Louisiana, said Republicans who ran on repealing Obamacare felt they had no choice but to vote for the bill, despite its flaws. “I don’t think Republicans can face voters in 2018 and have a credible argument to keep them in control of Congress, if they did not do their No. 1 campaign priority to repeal Obamacare,” said Levine, CEO of Mountain States Health Alliance, a hospital system in Johnson City, Tenn.
Besides, he said, even if the GOP bill becomes law, it’s set up so that the changes won’t affect many people before the 2018 midterm elections. “People won’t feel this — good or bad — until well after the election.”
The bill moves across the Capitol to the Senate. With only a two-vote Republican majority and no likely Democratic support, it would take only three GOP “no” votes to sink the bill.
After weeks of will-they-or-won’t-they tensions, the House managed to pass its GOP replacement for the Affordable Care Act on Thursday by a razor-thin margin. The vote was 217-213.
Democrats who lost the battle are still convinced they may win the political war. As the Republicans reached a majority for the bill, Democrats on the House floor began chanting, “Na, na, na, na … Hey, hey, hey … Goodbye.” They claim Republicans could lose their seats for supporting a bill that could cause so much disruption in voters’ health care.
Now the bill — and the multitude of questions surrounding it — moves across the Capitol to the Senate. And the job doesn’t get any easier. With only a two-vote Republican majority and no likely Democratic support, it would take only three GOP “no” votes to sink the bill.
Democrats have made clear they will unanimously oppose the bill. “Trumpcare” is just a breathtakingly irresponsible piece of legislation that would endanger the health of tens of millions of Americans and break the bank for millions more,” said Senate Minority Leader Chuck Schumer (D-N.Y.).
And Republicans in the Senate have their own internal disagreements, too.
Here are five of the biggest flashpoints that could make trouble for the bill in the upper chamber.
Medicaid
House leaders correctly point out that their bill represents the biggest changes to the federal-state health program for the poor since its inception in 1965 — a point that appeared to be drowned out during the most recent House debate that focused on coverage for people with preexisting health conditions.
For the first time, federal funding for low-income people on Medicaid would be limited, resulting in what House Speaker Paul Ryan (R-Wis.) described at an event sponsored by the conservative National Review as “sending it back to the states, capping its growth rates.” It’s a longtime goal for many conservatives. Said Ryan, “We’ve been dreaming of this since I’ve been around.”
But it is not a consensus position in the party. Some moderates support the current program, especially for children and people with disabilities. In addition, many GOP governors took the federal government’s offer in the ACA of near-complete federal funding to expand Medicaid to non-disabled, working-age adults, and they are worried about the impact on their residents and their budgets if the expansion goes away and the program’s funding is restricted.
The House bill, wrote the Republican governors of Ohio, Michigan, Arkansas and Nevada in a letter to House and Senate leaders, “provides almost no new flexibility for states, does not ensure the resources necessary to make sure no one is left out, and shifts significant new costs to states.”
That pushback has also created doubts in the minds of some GOP senators. Sens. Rob Portman (R-Ohio), Bill Cassidy (R-La.) and Shelley Moore Capito (R-W.Va.) are among those who have expressed concerns about the House bill, as has Dean Heller (R-Nev.) It’s not clear if any of the House changes have satisfied those senators.
Increase In Number Of Uninsured People
The Congressional Budget Office’s initial estimate that the bill could lead to 24 million more Americans without health insurance within a decade spooked many lawmakers in the upper chamber. “You can’t sugarcoat it,” Cassidy told Fox News when explaining that “it’s an awful score.” The final House bill passed without the score being updated, although most outside analysts said the changes were likely to increase the number who would lose insurance.
And Democrats have been using those initial numbers to score rhetorical points, even if they lack the votes in either the House or Senate to stop the bill or change it. “The CBO’s estimate makes clear that Trumpcare will cause serious harm to millions of American families,” said Schumer. “Tens of millions will lose their coverage, and millions more, particularly seniors, will have to pay more for health care.”
Tax Credits
On one hand, even with the additional $85 billion added by House leaders to help older people pay for their insurance premiums, many moderates feel the age-based tax credits in the bill replacing those in the Affordable Care Act are too small, particularly for people in their 50s and early 60s. The CBO estimated that under the original version of the House bill, premiums for a 64 year-old with an income of $26,000 a year could rise from $1,700 currently to more than $14,000.
That brought a strong rebuke from the powerful AARP, which was an outspoken ACA supporter. “Although no one believes the current health care system is perfect, this harmful legislation would make health care less secure and less affordable,” said a statement from the group.
Sen. Susan Collins (R-Maine) has said she could not support the House bill in its original form because of concerns about the effects on older constituents.
On the other hand, some conservatives in the Senate are ideologically opposed to offering any tax credits. Sens. Ted Cruz (R-Texas), Mike Lee (R-Utah) and Rand Paul (R-Ky.) have all expressed concerns about the bill being too much like the ACA, with Paul referring to it as “Obamacare Lite.” They worry that the tax credits amount to a new entitlement.
“For me, it’s a big stumbling block still that there’s taxpayer money that’s being given to insurance companies,” Paul told reporters in late April. “And I’m just not in favor of taxpayer money going to insurance companies.”
Planned Parenthood
As Republicans have been vowing for years, the House-passed bill would defund Planned Parenthood, although only for a year. That’s likely because a permanent defunding would actually cost the federal government more money, according to the CBO, as some women who lose access to birth control would become pregnant, have babies and qualify for Medicaid. Birth control is vastly cheaper than health care for mothers and babies.
But while cutting funding for Planned Parenthood is overwhelmingly popular in the House, there are a handful of GOP senators, including Collins and Lisa Murkowski (R-Alaska), who have said they are likely to oppose a bill carrying this provision.
Procedural Problems
The budget process Republicans are using to avoid a Democratic filibuster in the Senate, called reconciliation, has very strict rules that require every piece of the bill to be directly related to the federal budget. It will be up to the Senate parliamentarian, a Republican appointee, to make those determinations.
That’s why the bill does not wipe away all the ACA’s private insurance regulations, including the requirement that insurers not discriminate against customers who have preexisting health conditions.
Some analysts have suggested that the House amendment sought by conservatives to allow states to waive some of the health law’s regulations might run afoul of Senate’s “Byrd Rule,” which limits what can be included in a budget reconciliation measure.
“It could be argued that any budgetary effects of the waiver are ‘merely incidental,’” said the Committee for a Responsible Federal Budget in a blog post.
Even Rep. Mark Meadows, R-N.C., who negotiated that amendment that won the backing of conservatives, conceded that it could prove problematic in the upper chamber. “There’s still a lot of work that needs to be done before we can celebrate and all go home,” he said in an interview outside the House chamber.
Democrats say it is one of several provisions in the House bill that might not pass parliamentary muster in the Senate.
For example, analysts have suggested that the GOP replacement for the much-disliked “individual mandate” requiring most people to have insurance or pay a fine might not pass Byrd Rule scrutiny either. That’s because the 30 percent premium penalty that people with a lapse in insurance would have to pay under the bill would go to the insurance company, not the federal government, so it would have no budget impact.
A third potentially problematic element of the original House bill would allow insurers to charge older adults five times more in premiums than younger adults — up from a ratio of 3-to-1 under the Affordable Care Act. That provision could be viewed as not directly affecting federal spending, some analysts predict.
The CEO’s comments break with conventional wisdom, showing that at least one insurance industry leader has strong reservations about returning to the practice of scrutinizing people’s medical histories to determine rates.
The chief executive of Blue Shield of California, the largest insurer on the state’s insurance marketplace, issued a blunt critique of the Republican health care bill, saying it would once more lock Americans with preexisting conditions out of affordable coverage.
In an interview with California Healthline on Wednesday, Paul Markovich said the GOP’s American Health Care Act is “flawed” and “could return us to a time when people who were born with a birth defect or who became sick could not purchase or afford insurance.” The bill is set to come up for a vote in the House of Representatives on Thursday. (California Healthline is produced by KHN.)
An amendment to the bill would allow states to roll back key consumer protections in the Affordable Care Act, including the popular provision that prohibits discrimination against patients with a history of illness. Some Republicans say that flexibility will help lower premiums overall and expand coverage choices for consumers.
Markovich, however, said “it’s a moral imperative” to guarantee coverage regardless of medical history. “The discrimination, whether on price or just on the ability to access insurance at all on preexisting conditions, is unconscionable. As a country, we are better than that,” he said.
The CEO’s comments carry weight because he leads a major Blue Cross Blue Shield plan. They also break with conventional wisdom, showing that some in the insurance industry have strong reservations about returning to the practice of scrutinizing people’s medical histories to determine rates.
Markovich said that his company has been in touch with policymakers behind the scenes, but that it decided to make a public statement now because a House vote appeared imminent.
Most major insurers have remained silent about the most controversial issues during the latest health care debate, although some have backed Republican funding proposals to help stabilize the exchanges or repeal an ACA tax on health insurance.
Markovich indicated that he is skeptical of Republican proposals to cover people with preexisting conditions through “high-risk pools.” He said a proposal unveiled Wednesday to add another $8 billion in the bill over five years to offset insurance costs for those patients falls far short of what would be needed.
More broadly, Markovich said the GOP bill would make health insurance unaffordable for millions of Americans by significantly reducing the premium tax credits consumers rely on. He also warned that the GOP’s proposal to deeply cut Medicaid would place an “impossible” fiscal burden on states such as California, “resulting in millions more people without access to care.”
About a third of Californians are covered by Medi-Cal, the state’s version of Medicaid.
Blue Shield, based in San Francisco, leads the Covered California exchange with 31 percent of enrollment, or nearly 390,000 customers. Industry giants Anthem and Kaiser Permanente are close behind. Overall, the exchange has 1.3 million enrollees. Blue Shield also participates in the state’s Medi-Cal managed care program. (Kaiser Health News, which produces California Healthline, is not affiliated with Kaiser Permanente.)
This year, Blue Shield raised its premiums on the exchange by nearly 20 percent, on average. Like other insurers, the company filed its initial rates for 2018 this week with Covered California, though they are not yet public.
Markovich said the proposed rates remain in flux while insurers wait to see whether the Trump administration will pay them crucial subsidies that reduce the costs of deductibles and copayments for many lower-income consumers.
House Republicans have challenged the legality of those “cost-sharing” subsidies, and the White House has sent mixed signals on future funding. These payments to insurers are separate from the consumer tax credits used to offset premiums.
Covered California warned last weekthat premiums for 2018 could soar by 42 percent statewide, on average, if cost-sharing subsidies aren’t funded and the individual mandate to purchase coverage isn’t enforced.
Markovich said those estimates “are in the ballpark” of what his company forecasts as well. “This has the potential to have a really big impact on 2018 rates if the cost-sharing reduction subsidies are not being paid,” he said.
Molina Healthcare, another prominent insurer in California and on other exchanges,expressed similar frustration this week about the uncertainty surrounding the cost-sharing subsidies.
As critical as he was of the Republican bill, Markovich also indicated that Obamacare could use some improvement, too.
“We were and are big supporters of the ACA,” Markovich said. “It’s done a lot of good and we’ve taken a major step forward to cover people. But in some markets it’s not sustainable from a cost standpoint, and one of the flaws is it wasn’t bipartisan.”
The CEO called on Democrats and Republicans to work together on legislation that builds on the successes of the ACA and addresses the problems that remain.
The Republicans “have done some good work here, but we need to expand the conversation outside of one party,” he said.
The state’s health secretary has reached out to the nation’s top health experts to explore tapping a patent law created in 1910 that gives federal regulators the power to appropriate inventions and develop a product in the interest of the public good.
The public outrage over high-priced hepatitis C drugs is taking a new twist as Louisiana’s top health official proposes using an obscure federal law to get the medicines at a much lower cost. If successful, other states could reap the benefits.
Right now, covering treatment for the 35,000 of Louisiana’s uninsured and Medicaid-dependent residents with hepatitis C would cost the state $764 million, a staggering sum that would have to be pulled from schools, public services and infrastructure programs. Louisiana’s budget runs $31.2 billion a year, but its discretionary line items, such as health care, account for just $3.6 billion.
“We don’t have the resources,” said Dr. Rebekah Gee, the state’s health secretary.
In an April 12 letter, Gee reached out to the nation’s top health experts to explore tapping a patent law created in 1910 that gives federal regulators the power to appropriate inventions and develop a product in the interest of the public good.
The law has been used before by government agencies, including the Department of Defense. In the 1960s and early ’70s, the government used it to buy several medicines at a lower cost, according to Hannah Brennan, a co-author of a2016 paper on the law.
In response to Gee’s request, Dr. Joshua Sharfstein, an associate dean at Johns Hopkins Bloomberg School of Public Health, spent a recent afternoon with some of the country’s top academic and legal health officials considering the challenges of using the law, called U.S. Code Section 1498 under Title 28.
They concluded it should be tried.
“This is the path that would be the most viable to be able to get what you need for people in Louisiana,” Sharfstein told the group. Sharfstein, a former Maryland health secretary, was also the Food and Drug Administration’s deputy commissioner in the Obama administration.
Under the law, the Trump administration could sidestep patents and contract with a generic supplier to provide a lower-priced version of expensive antiviral drugs such as Sovaldi and Harvoni, which are made by industry leader Gilead Sciences.
The government would have to pay the drugmaker only reasonable compensation and prove that using the product benefits the U.S. government. And a favorable ruling for Louisiana would mean the strategy could be used across all 50 states.
Gee, who is working to raise bipartisan support to force a change in hepatitis C drug prices, said she believes the use of the patent law could be a “win-win” for the state and industry.
“Pharma needs to think about different approaches to profitability,” Gee said. “Sometimes quantity can be an important driver of profit, not just the price of each unit of this drug.”
Her proposal would ultimately need approval from Health and Human Services Secretary Tom Price, who oversees the federal agency that administers Medicaid. During his confirmation hearings, Price said he would be committed to making certain that drug prices “are able to be afforded by individuals.”
As a physician and longtime senator from Georgia,Price’s record indicates that he believes government influence should be reduced in health care and during his confirmation hearing praised a Medicare Part B program that allowed privately owned pharmacy benefit managers to negotiate drug prices.
Rachel Sachs, associate professor of law at Washington University in St. Louis who attended the Johns Hopkins meeting, said she believes “the case is strong” in invoking the law, even though drug companies may have multiple patents and exclusivity periods to protect their drugs.
“The federal government has a direct financial interest in controlling hepatitis C,” Sachs said, noting that many of those infected are covered by public programs like Medicaid or the prison system.
And, in 2015, the federal government’s Centers for Medicare & Medicaid Services said states should not unreasonably restrict coverage of the treatments for people with the disease. Last year, 324 Louisiana Medicaid enrollees were treated for an average price of $85,000 each.
The Pharmaceutical Research and Manufacturers of America, the trade association for drugmakers, declined to comment on the potential use of the law. Gilead did not return calls for comment.
The high prices of hepatitis C drugs have been an ongoing concern for public health officials. Last year, the National Association of Medicaid Directors asked Congress to take action, calling hepatitis C a “pervasive public health threat.” And last month, the National Academies of Sciences, Engineering and Medicine recommended its own plan to lower drug prices for vulnerable populations in order to solve the “serious public health problem.”
Hepatitis C infections, which spread through blood or other bodily fluids, are usually silent for many years until the virus damages the liver enough to cause symptoms such as jaundice and fatigue. People can spread the disease unwittingly and an estimated 2.7 million Americans now have chronic hepatitis C.
Dr. Peter Bach, director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Center in New York, has created an online budget allocator tool to show how impossible it is for Louisiana to treat its Medicaid population without a lower price.
The tool, using estimates of drug costs from Gilead’s public filings, shows where millions of dollars would need to be shifted in the state’s discretionary budget to pay for hepatitis C treatments. For instance, cutting K-12 funding by $26 million — taking benefits away from about 3,500 students — would cover treatments for 3,176 hepatitis C patients.
Too often, Bach said, discussions about costs do not illustrate the trade-offs.
“These numbers are so large that it’s very difficult to think about them proportionately,” said Bach, who has also suggested that the U.S. government simply buy Gilead to lower the cost of treatments.
Brennan told the group that the Department of Defense’s Military Medical Supply Agency relied on Section 1498 to procure 50 drugs during a three-year period for a total savings of $21 million. In one example, the government procured the antibiotic nitrofurantoin for nearly four times less than the patent holder’s price.
“This was … a really important and routine use,” she said.
In the 1970s, use of the law for purchasing medicines petered out, Brennan said, likely because of pharmaceutical lobbying and the increasing importance placed on protecting patents.
But that has not stopped other government agencies from continuing to tap the law. Brennan’s paper notes that the government routinely relies on the patent law to act in the public’s interest for inventions ranging from electronic passports to genetically mutated mice. The U.S. Army Corps of Engineers used the law to clean up hazardous waste and, over the past decade, it was also used by the National Institutes of Health, National Gallery of Art, National Park Service and General Services Administration, according to the paper.
In 2001, Tommy Thompson, then-secretary of the Department of Health and Human Services,threatened use of the law to gain a lower price on the anthrax drug Cipro. And in 2015, Sen. Bernie Sanders (I-Vt.) asked the Department of Veterans Affairs to use the law to decrease the price of hepatitis C drugs.
Now, two years later, health experts are working with Gee to craft a proposal.
“This is exactly the moment and exactly the kind of scenario where we should” use such a law, Bach said.
Republicans’ pathway to fulfilling their seven-year effort to undo the federal health law is getting narrower by the day.
The House may pass its bill to repeal and replace parts of the Affordable Care Act. But Republicans’ pathway to fulfilling their seven-year effort to undo the federal health law is getting narrower by the day.
“As of now, they still don’t have the votes,” said Rep. Pete King (R-N.Y.) as he was leaving a meeting of GOP members Tuesday. King has been a target for those pushing both for and against the bill.
The latest snag is over whether people with preexisting health conditions should have guaranteed access to affordable coverage, as the ACA mandates. An amendment that would let states waive some of those requirements has garnered the votes of reluctant conservatives but left more moderate Republicans concerned.
“I’ve supported the practice of not allowing preexisting conditions to be discriminated against from the very get-go,” Rep. Fred Upton (R-Mich.), a former chairman of the House committee that handles most health issues, told a Michigan radio station Tuesday in explaining his decision not to support the bill. “This amendment torpedoes that.”
House leaders stressed that they are still working to muster a majority to pass the bill, which was originally scheduled for a full floor vote in March.
Here are some possible ways the effort could play out.
1. The House passes its bill soon.
Approval in the House would send the measure to the Senate, where the fight will be very different. Congress is using a special budget procedure that allows the bill to pass with 51 votes. There are only 52 Republicans in the Senate, so they can’t afford to lose more than two GOP votes, assuming every Democrat opposes the measure. In that case, Vice President Mike Pence would be needed to break a tie.
While this special procedure makes the bill easier for Republicans to pass, the Senate’s budget “reconciliation” process must follow a series of specific rules that exclude provisions that don’t directly affect the federal budget.
Various parts of the House bill, including a recent change to let states waive some coverage rules that has ignited concerns about preexisting conditions, have been mentioned as possible violations of those Senate rules and would have to be taken out in order to qualify for the protections of reconciliation.
The Senate may also amend the bill and the House would have to approve those changes, which could again break the delicate coalition of House GOP support.
2. The House walks away from the debate.
In theory, the House could just leave health care for another day — or another year. That would be a huge setback for President Donald Trump, who campaigned on a pledge to “repeal and replace” the health law, as well as for congressional Republicans, who have been promising to do the same since the bill became law in 2010.
But if the law truly implodes for 2018, meaning insurers drop out of so many areas that millions of people have no insurance options, it could trigger an entirely different health debate.
3. The House decides to switch gears to tax reform.
Health care is not the Republicans’ only high priority. So is an overhaul of the federal tax code.
But Republicans want to use the same budget reconciliation procedure to pass their tax plan. That’s a problem.
In order to make sweeping tax changes under expedited budget rules, the House and Senate would have to move on to a fiscal 2018 budget resolution, which would override the 2017 budget blueprint. But as soon as it does, the protections for the health bill would expire.
There is another option. Each budget resolution can allow one spending bill and one tax bill to be protected by reconciliation rules. So Congress could simply start the process over in a 2018 budget resolution that would allow it to move on tax reform and changes to the health law simultaneously.
4. Congress tries to overhaul health law incrementally.
The House could abandon the budget process and simply pass bills without regard to whether they have an effect on the budget. The first step, though, would likely be for the House to repeal the ACA wholesale — giving Republicans political cover. Then they could take up smaller pieces of legislation, such as a bill that would allow health insurance to be purchased across state lines, a favorite idea of Trump’s. Those bills, however, would require 60 votes in the Senate, which seems unlikely given Democratic opposition.
If the GOP efforts to bring wholesale change to the ACA are exhausted, though, it may be possible for some moderate Republicans to craft legislation with Democrats to fix some of the issues that both parties see in the law.
5. The Senate gets rid of the legislative filibuster.
The Senate earlier this year abolished the need for 60 votes to fill a Supreme Court seat, which got Trump’s nominee, Neil Gorsuch, approved. Trump has been calling for Republicans to also get rid of the filibuster for legislation. “Either elect more Republican Senators in 2018 or change the rules now to 51%,” he tweeted on Tuesday.
But the legislative filibuster is the last protection for a Senate minority party, and Republicans know they will someday be that minority again. Senate Majority Leader Mitch McConnell (R-Ky.) has said repeatedly he has no intention of taking this step, telling reporters Tuesday it “would fundamentally change the way the Senate has worked for a very long time.” And even if he changed his mind, he might have trouble persuading some of his Republican colleagues to go along.
A small but growing number of hospitals and oncology practices are incorporating urgent care aimed specifically at cancer patients.
On an afternoon a few weeks ago, Faithe Craig noticed that her temperature spiked to just above 100 degrees. For most people, the change might not be cause for alarm, but Craig is being treated for stage 3 breast cancer, and any temperature change could signal a serious problem.
She called her nurse at the hospital clinic where she gets care at the University of Texas Southwestern Medical Center in Dallas, who told her to come in immediately for cancer urgent-care services at the hospital’s hematology oncology clinic.
“I thought I’d be waiting there all night,” said Craig, 33. But the hospital had already lined up a blood draw before she arrived and then sent her directly to get X-rays.
Clinicians had details of her cancer care at their fingertips. “They already knew my story and knew everything about me,” she said. The blood work showed she had severe anemia, requiring a blood transfusion, pronto.
It’s been more than a year since the medical center began providing same-day urgent care services to cancer patients. It’s an effort to help them avoid the emergency department and hospital admissions, said Dr. Thomas Froehlich, medical director of the all the center’s cancer clinics.
Cancer treatment “clearly carries a lot of side effects and toxicity, and there are also complications of dealing with the cancer,” Froehlich said. “Many of these things, if you can intervene early, you keep patients at home and out of the hospital.”
UT Southwestern isn’t alone. A small but growing number of hospitals and oncology practices are incorporating urgent care aimed specifically at cancer patients, in which specialists are available for same-day appointments, often with extended hours, sometimes 24/7.
Keeping cancer patients out of the emergency department makes sense not only because many of them have compromised immune systems that put them at risk in a waiting room full of sick people, but to provide the most efficient and appropriate care.
“What we hear from cancer physicians and administrators is that in the emergency department not all emergency physicians and nurses feel equally confident in their ability to treat cancer patients,” said Lindsay Conway, managing director of research at the Advisory Board, a health care research and consulting firm. “So they may admit them when it’s not necessary.”
Severe pain, nausea, fever and dehydration are not uncommon side effects of traditional chemotherapy. Newer immunotherapy treatments that activate the immune system to fight cancer can cause serious and sudden reactions if the body instead attacks healthy organs and tissues.
It can be difficult for non-cancer specialists to evaluate what these symptoms mean. “Targeted therapies are wonderful, but if you don’t know the drug, you’re going to have a hard time managing the person,” said Dr. Barbara McAneny, CEO of New Mexico Oncology Hematology Consultants in Albuquerque, which operates three cancer centers in New Mexico that together provide same-day urgent care services for more than a dozen cancer patients daily.
Offering same-day services fits in with a broader shift in oncology toward patient-centered care, said Dr. J. Leonard Lichtenfeld, deputy chief medical officer at the American Cancer Society.
“There’s a general sense within the practice of oncology that we need to do a better job of managing pain and side effects, and we need to provide a higher level of care,” Lichtenfeld said.
The federal Centers for Medicare & Medicaid Services is encouraging these efforts through new payment and delivery models designed to reward quality cancer care, Lichtenfeld said. In addition, starting in 2020 hospitals may be penalized financially if patients who are receiving outpatient chemotherapy visit the emergency department or are admitted to the hospital, according to a final rule issued in November.
Avoiding the emergency department makes financial sense for patients and insurers, too.
Johns Hopkins Hospital opened a six-bed urgent care center next to its infusion center a couple of years ago. Of the patients who land there, about 80 percent are discharged home, at an average total hospital charge of $1,600, said Sharon Krumm, director of nursing at Johns Hopkins Kimmel Cancer Center. (The patient and the insurer would divvy up that charge based on the patient’s insurance coverage.) Only 20 percent of cancer patients who visit the hospital’s emergency department are discharged home. Those who are have an average total hospital charge of $2,300. The others face the ER charges plus the hefty cost of a hospital admission.
Rebecca Cohen has been a frequent visitor to the Johns Hopkins urgent care center. Diagnosed more than two years ago with stage 4 lung cancer, Cohen, 68, is receiving immunotherapy. She’s been treated or checked for dehydration, electrolyte abnormalities, low hemoglobin, low sodium, blood clots and infection, among other things.
Before she started going to the cancer urgent care center, “you sat in the waiting room at the emergency room with people who had the most extraordinary diseases,” Cohen said. “Having stage 4 lung cancer, the thought of being exposed to pneumonia or bronchitis is more than scary.”
The risk of serious problems varied widely among centers, according to research from the University of Michigan Institute for Healthcare Policy and Innovation.
Getting bariatric surgery at a “center of excellence” doesn’t mean that patients can be assured that they will avoid serious complications from the weight-loss procedure at the facility, according to a recent study.
Even though facilities that have been accredited as centers of excellence must all meet minimum standards, including performing at least 125 bariatric surgeries annually, the risk of serious problems varied widely among centers, the study found.
“To become accredited, there’s no measure of outcomes, it’s just a process list,” said Dr. Andrew Ibrahim, a research fellow at the University of Michigan Institute for Healthcare Policy and Innovation and the study’s lead author. In addition to minimum case volumes, accredited centers have to have special surgical equipment to handle overweight patients, such as bariatric operating tables and longer laparoscopic instruments.
Insurers typically restrict coverage of bariatric surgery to procedures performed at accredited facilities, however, and nearly 90 percent of bariatric surgeries are performed at a center of excellence.
Bariatric surgery is used to treat people who are severely obese and have not had success with other weight-loss programs. Surgeons use a variety of methods to make the stomach smaller so that less food can be consumed easily.
For this study, researchers analyzed claims data of more than 145,000 patients at 165 bariatric surgery centers of excellence in 12 states from 2010 to 2013. Nationally, the rate of serious complications following surgery — heart attack, kidney failure or blood transfusion, for example — varied widely among the centers, from 0.6 percent at the low end to 10.3 percent at the high end. The rate varied widely within states as well. Nearly 1 in 3 lower-performing hospitals had a higher-performing hospital in the same service area, the study found.
Bariatric surgery has come a long way from the early days when some low-volume centers experienced 30-day mortality rates approaching 10 percent, according to Ibrahim. In this study, 72 patients died in the hospital following surgery — a rate of less than 1 percent among study participants.
However, while accreditation has had an effect on quality and safety, “at the moment, just going to a center that is accredited does not ensure uniform high-quality care for a patient,” Ibrahim said.
The degree of technical skill of the surgeon performing the procedure may affect post-operative outcomes, the study found, as may the degree to which centers follow accepted best practices for bariatric patient care. Neither of those variables is captured in this study.
The organization that accredits bariatric surgery hospitals collects data from hospitals about serious complications, but the data aren’t publicly available, according to the study. So there’s no way for patients to use the data to learn which bariatric center of excellence in their area has the lowest serious complication rates. “Not yet,” Ibrahim said.