Once again, the fate of the Affordable Care Act is before the courts. The health law has traveled all the way to the Supreme Court (twice!) and is highly likely to make another visit.
On that path, the law made a stop Tuesday before a three-judge panel of the 5th Circuit Court of Appeals in New Orleans. Both sides presented arguments, interrupted, at times, by sharp questions from two of the judges.
For those just tuning in, the Trump administration is not defending the nine-year-old ACA.
In doing so, Department of Justice lawyers appeared to use strategies and take positions that sounded somewhat unconventional to a layperson. But are they?
KHN checked with some legal experts for their take.
For starters, this is the third time the administration has changed its position. Does this often happen?
No. It's unusual for an administration to shift its own legal opinions during the case, say experts.
When the lawsuit was filed, the administration said only the parts of the law tied to a requirement that most Americans carry insurance, the so-called individual mandate, should be tossed. (That's a pretty big part, which includes protections for people with preexisting conditions.)
The red-state plaintiffs, conversely, argued that the entire law should go, pointing to Congress' 2017 vote to zero out the individual mandate's tax penalty. The Supreme Court's 2012 decision to preserve the ACA hinged on that penalty.
But, last December, aUnited States district court judge in Texas sided with the states, saying the whole law should be tossed, which would affect provisions as diverse as the preexisting condition protections, Medicaid expansion and calorie counts on restaurant menus.
"You don't usually say, 'Oh, never mind,'" said Tom Miller, resident fellow at the conservative American Enterprise Institute. "It's unusual to do that flip."
But that's not the last flip. Another change came up in legal papers filed shortly before the Tuesday hearing and in oral arguments.
DOJ attorney August Flentje told the appeals court that, well, maybe only those provisions of the law that directly affect the plaintiffs — the 18 states — should be struck.
"It's complicated," he admitted, calling to mind a similar statement made in 2017 by President Donald Trump amid the repeal debate in Congress: "Nobody knew that healthcare could be so complicated."
Even as this legal challenge works its way through the courts, the ACA remains the law of the land. The evolving legal positions, however, are fodder for professors.
"I'm teaching a class this fall and this gives me more material," said Miller. "But if I had to consistently try to argue a position at the DOJ, I would go crazy."
So, the government wants to skewer some provisions of the law, but not others — and have those changes apply only in some states. How would that work?
Questions about that argument came from 5th Circuit Judge Jennifer Walker Elrod, appointed by President George W. Bush in 2007.
The government wants to have it apply "in certain states and strike it down in certain states?" Elrod asked. "The government believes that's a possibility?"
Unasked but implicit: How would some states enforce the law and not others?
Flentje said "a lot of that would have to get sorted out" but not until after all the appeals in the case are exhausted.
Behind the argument may well be an ongoing dispute in the legal community about whether lower-court judges should make decisions that have nationwide implications, said John Malcolm, director of the conservative Heritage Foundation's Edwin Meese III Center for Legal and Judicial Studies. Still, it would be difficult, he said, for the ACA to be declared unconstitutional in some states, but remain in effect elsewhere.
Beyond that legal question, such a position has financial and policy implications for consumers and state regulators.
"It would create a very untenable situation for the rest of the states," said Mila Kofman, executive director of the DC Health Benefit Exchange Authority, where individuals and small businesses buy health insurance.
Some of the very sickest people in the states where the rules were dropped would likely move to states keeping the preexisting condition protections so they could maintain their insurance, she said. That could drive up costs in those areas.
Arguments Tuesday revolved around whether parts of the law were "severable" from other parts. Did it seem the government wants it both ways — to toss the entire law, but also keep parts of it?
Elrod again queried Flentje.
The government wants the health insurance provisions to go, but "you would leave in the calorie guide?" Elrod asked, referring to the ACA's requirement that chain restaurants display calorie counts of menu items.
Flentje said the government's "argument on scope is totally separate from argument on severability."
She pressed him for clarification: "So, are you saying it's entirely inseverable, or arguing that some parts can be kept?"
The government's position remains that "the entire act is not severable," he replied, adding, however that the judgment could be "narrowed a bit to provisions that injure and impact the plaintiffs."
He suggested some of those details would still have to be worked out.
"They've gone from saying a couple of provisions have to go to the whole thing has to go, to now there are some things we might not have to get rid of," said Miller. "But they've never defined how far back down the ladder to go."
A ruling by the appeals court isn't expected for weeks or months, and some questions may well return to the district court.
A growing number of health systems and insurers providing real-time drug pricing information to physicians so they can help patients avoid 'sticker shock' at the pharmacy.
This article was first published on Wednesday, July 10, 2019 in Kaiser Health News.
When Mary Kay Gilbert saw her doctor in May for a skin infection on her leg, she wasn't surprised to receive a prescription for an antibiotic cream.
But Gilbert, 54, a nurse and health consultant, was shocked when her physician clicked on the desktop computer and told Gilbert the medicine would cost $30 on her Blue Cross and Blue Shield plan.
"I was like, 'Wow — that's pretty cool that you know that information,'" she recalled telling the doctor in Edina, Minn.
Allina Health, a large Minnesota hospital network to which Gilbert's doctor belongs, is one of a growing number of health systems and insurers providing real-time drug pricing information to physicians so they can help patients avoid "sticker shock" at the pharmacy.
The pricing tool, which is embedded in physicians' electronic health record and prescribing system, shows how much patients will pay out-of-pocket based on their insurance and the pharmacy. It allows the doctor to find a cheaper alternative when possible and start the process of getting authorization for a drug, if the insurer requires that.
The soaring cost of drugs has been front and center in the growing national debate about revamping U.S. healthcare.
Consumers abandon hundreds of thousands of prescriptions each year at the pharmacy, often because of high prices, jeopardizing their health and often leading to higher costs down the road, studies show.
Experts say the tool can help consumers — who are facing increasing copayments and higher deductibles — learn about cheaper options in the doctor's office.
Still, doctors have been slow to adopt the technology, sometimes because of concerns about getting bogged down in long discussions about drug costs. Humana, for example, introduced its drug pricing tool to its network doctors in 2015. Today, fewer than 10% are using it, company officials said.
But the tool has serious limitations too. Because price negotiations among insurers, drugmakers and middlemen are often highly competitive and secretive, the tools often don't have data for everyone. For example, Allina's works for only about half its patients. That's because not all pharmacy benefit managers share their data on health plan enrollee costs, and those that do often provide only a fraction of their information.
"It's a chicken-and-egg thing where doctors don't use it because they don't have the data for all their patients, and health plans don't promote it to physicians because doctors don't have the technology in place," said Anthony Schueth, a health information technology consultant in Jacksonville, Fla. "It can be a powerful tool when it works, but at the moment the drivers are not there across the board for widespread adoption."
At a hearing last month, Sen. Martha McSally (R-Ariz.) pressed a top Trump administration health official about why many patients lack access to information on prescription drug prices at their doctor's office.
"This is America. Why can't we have this tool available tool now?" she asked. "The data is out there; the information is out there. What is it going to take to make this happen?"
The technology got a boost last month when the Centers for Medicare & Medicaid Services mandated that all Medicare drug plans embed such a tool in their doctors' electronic prescribing system starting in 2021.
The details of what consumers spend out-of-pocket for drugs is provided by pharmacy benefit managers, or PBMs. They are the middlemen that negotiate with drugmakers on the prices insurers will pay for the medications and which ones the insurers will cover. So a tool's usefulness is undermined when key PBMs are not included in the listings.
For example, a drug pricing tool sold by Arlington, Va.-based Surescripts, which is owned partly by the PBMs CVS Caremark and Express Scripts, includes data from those companies, but not OptumRx, a PBM owned by insurance titan UnitedHealth. And the OptumRX drug pricing tool includes Optum data but not that of Express Scripts and CVS.
Demetrios Kouzoukas, who heads the Medicare program for CMS, said he hopes the program's new drug mandate will spark the industry to provide doctors and patients access to a pricing tool, regardless of their insurance.
"What we are hoping and expecting is that there will be a standard that's developed by the industry … so that the tool is available in all the electronic health records, for all the doctors and all patients, and spreads even beyond Medicare," he told McSally at the hearing.
Given the competitive nature of the industry, cooperation does not seem to be on the horizon, some industry officials say.
"I don't see any chance that there will be a centralized system that will connect all of the plans/PBMs with all of the EHR systems currently in use anytime soon," said Thomas Borzilleri, CEO of InteliSys Health, a health technology company based in San Diego.
However, the National Council for Prescription Drug Programs, a nonprofit group that helps set guidelines for the pharmacy industry, has been working on standards for a drug pricing tool. John Klimek, a senior vice president, predicts that by next year doctors across the country will be able to use the same drug pricing tool to look up all their patients' drug costs, regardless of the insurer.
Even without such a standard in place, doctors and hospitals have an incentive to use the tool beyond offering a cost-saving service to their patients: It can save providers money, too.
For example, Allina, which owns or operates about a dozen hospitals and dozens of clinics in Minnesota and Wisconsin, gets a set fee from some insurers to care for all of a patient's health needs. So the doctors and health system benefit when they can reduce costs and improve patients' adherence to taking their medication, said Dr. David Ingham, a family doctor also from Edina, one of 600 primary care doctors at Allina using the tool.
"When we prescribe a more expensive medication, we share less revenue from the insurance contract," he said.
For example, he noted that the tool helped him prescribe inhalers to asthma patients.
"I pulled up one medication I normally use, and it said it would be $240 out-of-pocket, but it suggested an alternative for $20 that was pharmacologically equivalent. I sheepishly asked the patient which we should choose," he said.
Dr. Norman Rosen, a family physician in Orange, Calif., who is employed by Providence St. Joseph Health System, is one of 800 doctors at the hospital testing the Blue Shield of California drug pricing tool this year. Based on the first few months of use, the tool is expected to save patients a total of more than $100,000 in out-of-pocket costs this year, according to the companies.
Without the tool, Rosen said, it would be impossible for him to quickly know what drugs are covered by which insurers and what the copays are. He said he already has saved some patients several thousand dollars a year by changing their blood pressure and diabetes medications.
"It doesn't take a lot of time, and this can be an important intervention because one of the fears we have is a patient not taking their medication because it's too expensive," Rosen said.
As California prepares to expand Medicaid coverage to young adults living in the state illegally, the number of undocumented immigrant children in the program is slowly declining, new state data show.
Unauthorized immigrant children have been eligible for Medi-Cal, the state's Medicaid program for low-income residents, since May 2016, and their enrollment peaked nearly a year later at 134,374, according to data from the state Department of Healthcare Services.
Since then, enrollment has stayed mostly flat or fallen. Last February, the latest month for which data are available, 127,845 undocumented immigrant children through age 18 were enrolled in Medi-Cal, down about 5% from the April 2017 peak.
This drop mirrors statewide and national trends for all children enrolled in Medicaid and the Children's Health Insurance Program, a separate public program that some states use to cover low-income children.
From December 2017 to December 2018, overall child enrollment in both programs dropped 2.2% nationally and 3% in California, according to a recent report from Georgetown University's Health Policy Institute.
Some experts attribute the enrollment drop among all children to a strong economy because more people have jobs — and access to employer-sponsored health insurance. But Medicaid researchers say there are likely other factors at play for immigrant children.
The decline in their enrollment is more likely due to a shift in migration patterns and rising fear among their families in response to anti-immigrant rhetoric and federal crackdowns on unauthorized immigrants, said Edwin Park, a health policy research professor at Georgetown University.
"It's likely the overall hostile environment for immigrant families is playing a critical role in enrollment," Park said. "You should have seen a continued ramp-up" in sign-ups because the program is still relatively new. California along with Illinois, Massachusetts, New York, Oregon and Washington, plus the District of Columbia, provide public health coverage for undocumented immigrant children.
Last year, California allocated $365.2 million to cover these children. Even though Medicaid is a joint state-federal program, California must pay for the expanded benefits for unauthorized immigrants itself.
Starting next year, as part of the 2019-20 state budget signed last month by Gov. Gavin Newsom, the state will expand Medi-Cal coverage to young adult unauthorized immigrants ages 19 through 25. Officials estimate 90,000 young adults will join in the first year.
President Donald Trump criticized California's move and threatened to "stop it."
"The Democrats want to treat the illegals with healthcare and with other things, better than they treat the citizens of our country," Trump said on July 1.
The state Department of Healthcare Services, which administers Medi-Cal, said undocumented immigrant children might be leaving the program because they age out of eligibility when they turn 19 or move out of state.
Randy Capps, director of research at the Washington, D.C.-based Migration Policy Institute, said a shift in immigration patterns into and out of California could also affect their enrollment.
The number of people coming into the country illegally is down, especially from Mexico, according to a Pew Research Center report released in June. That is notable in California, where Mexican nationals make up the majority of the state's undocumented immigrant population.
The report estimates there were 4.9 million unauthorized immigrants from Mexico in the U.S. in 2017, down from 6.9 million in 2007.
"All data suggest a downward trend on illegal immigration, especially of Mexican origin," Capps said.
In California, "with the recent economic boom, that may be accelerating because the cost of living is escalating astronomically," he said. "Housing is becoming prohibitively expensive for undocumented immigrants in large parts of the state."
Although there have been an increasing number of Central American migrants trying to enter the U.S. at the southern border this year, most are claiming asylum and are not considered undocumented immigrants.
As a result, most of those children wouldn't qualify for Medi-Cal under this program, explained Gabrielle Lessard, a staff attorney with the National Immigration Law Center.
But the rhetoric surrounding the Central American refugees has been heated, and Trump has made tough talk on immigration a centerpiece of his presidency.
Last month, Trump warned of "massive" deportation raids that would have targeted about 2,000 families — but they were postponed after he gave members of Congress time to make changes to asylum laws. He said the raids might begin this week.
His administration also has pursued policies targeting immigrants. For instance, last fall, the federal government introduced its "public charge" proposal, which would consider immigrants' use of public benefit programs including Medi-Cal, CalFresh and Section 8 housing vouchers as a reason to deny lawful permanent residency — or green card status.
That proposed rule has not taken effect, and it's not clear whether it will. If implemented, the policy would mostly affect legal immigrants, but it could also affect undocumented immigrants should they become eligible to seek legal status in the future.
In response, unauthorized immigrant families have been forgoing care, missing doctors' appointments and asking whether they should disenroll from Medicaid coverage, health centers across California and the country have reported.
Lessard suspects that unauthorized immigrants could be pulling their children out of Medi-Cal or simply not renewing their coverage.
"This community has been so terrorized by the administration that people are afraid to show up to their appointments at health centers," she said. "So the prospect of giving your information to the government, even though it's the state government, is really terrifying to a lot of people."
The fate of the Affordable Care Act is again on the line Tuesday, as a federal appeals court in New Orleans takes up a case in which a lower court judge has already ruled the massive health law unconstitutional.
Not only would such a decision immediately affect the estimated 20 million people who get their health coverage through programs created under the law, ending the ACA would also create chaos in other parts of the healthcare system that were directly or indirectly changed under the law's multitude of provisions, such as calorie counts on menus, a pathway for approval of generic copies of expensive biologic drugs and, perhaps most important politically, protections for people with preexisting conditions.
"Billions of dollars of private and public investment — impacting every corner of the American health system — have been made based on the existence of the ACA," said a friend-of-the-court brief filed by a bipartisan group of economists and other health policy experts to the 5th Circuit Court of Appeals. Upholding the lower court's ruling, the scholars added, "would upend all of those settled expectations and throw healthcare markets, and 1/5 of the economy, into chaos."
Here are five important things to know about the case:
It was prompted by the tax bill Republicans passed in 2017.
The big tax cut bill passed by the GOP Congress in December 2017 eliminated the penalty included in the ACA for failure to maintain health insurance coverage. The lawsuit was filed in February 2018 by a group of Republican attorneys general and two governors. They argued that since the Supreme Court had upheld the ACA in 2012 specifically because it was a valid exercise of Congress' taxing power, taking the tax away makes the entire rest of the law unconstitutional.
Last December, Judge Reed C. O'Connor agreed with the Republicans. "In some ways the question before the court involves the intent of both the 2010 and 2017 Congresses," O'Connor wrote in his decision. "The former enacted the ACA. The latter sawed off the last leg it stood on."
State and federal Democrats are defending the law.
Arguing that the rest of the law remains valid is a group of Democratic attorneys general, led by California's Xavier Becerra.
"Our argument is simple," said Becerra in a statement last Friday. "The health and wellbeing of nearly every American is at risk. Healthcare can mean the difference between life and death, financial stability and bankruptcy. Our families' wellbeing should not be treated as a political football."
The Democratic-led House of Representatives has also been granted "intervenor" status in the case.
The Trump administration has taken several positions on the lawsuit.
The defendant in the case is technically the Trump administration. Traditionally, an administration, even one that did not work to pass the law in question, defends existing law in court.
Not this time. And it is still unclear exactly what the administration's position is on the lawsuit. "They have changed their position several times," Sen. Chris Murphy (D-Conn.) told reporters on a conference call Monday.
When the administration first weighed in on the case, in June 2018, it said it believed that without the tax penalty only the provisions most closely connected to that penalty — including requiring insurers to sell policies to people with preexisting conditions — should be struck down. The rest of the law should stay, the Justice Department argued.
After O'Connor's ruling, however, the administration changed its mind. In March, a spokeswoman for the Justice Department said it had "determined that the district court's comprehensive opinion came to the correct conclusion and will support it on appeal."
Now it appears the administration is shifting its opinion again. In a filing with the court late last week, Justice Department attorneys argued that perhaps the health law should be invalidated only in the GOP states that are suing, rather than all states. It is unclear how that would work.
Legal scholars — including those who oppose the ACA — consider the case dubious.
In a brief filed with the appeals court,legal scholars from both sides of the fight over the ACA agreed that the lawsuit's underlying claim makes no sense.
In passing the tax bill that eliminated the ACA's tax penalty but nothing else, Congress "made the judgment that it wanted the insurance reforms and the rest of the ACA to remain even in the absence of an enforceable insurance mandate," wrote law professors Jonathan Adler, Nicholas Bagley, Abbe Gluck and Ilya Somin. Bagley and Gluck are supporters of the ACA; Adler and Somin have argued against it in earlier suits. "Congress itself — not a court — eliminated enforcement of the provision in question and left the rest of the statute standing. So congressional intent is clear."
It could end up in front of the Supreme Court right in the middle of the 2020 election.
Depending on what happens at the appeals court level, the health law could be back in front of the Supreme Court — which has upheld the health law on other grounds in 2012 and 2015 — and land there in the middle of next year's presidential campaign.
Democrats are already sharpening their rhetoric for that possibility.
"President Trump and Republicans are playing a very dangerous game with people's lives," Senate Minority Leader Chuck Schumer told reporters on a conference call Monday.
Murphy said he is most concerned that if the lower court ruling is upheld and the health law struck down, Republicans "won't be able to come up with a plan" to put the healthcare system back together.
"Republicans tried to come up with a replacement plan for 10 years, and they couldn't do it," he said.
Despite hospital systems and health officials calling out the need for more primary care doctors, graduates of U.S. medical schools are becoming less likely to choose to specialize in one of those fields.
A record-high number of primary care positions was offered in the 2019 National Resident Matching Program — known to doctors as "the Match." It determines where a medical student will study in their chosen specialty after graduation. But this year, the percentage of primary care positions filled by fourth-year medical students was the lowest on record.
"I think part of it has to do with income," said Mona Signer, the CEO of the Match. "Primary care specialties are not the highest paying." She suggested that where a student gets a degree also influences the choice. "Many medical schools are part of academic medical centers where research and specialization is a priority," she said.
The three key primary care fields are internal medicine, family medicine and pediatrics. According to the 2019 Match report, 8,116 internal medicine positions were offered, the highest number on record and the most positions offered within any specialty, but only 41.5% were filled by seniors pursuing their M.D.s from U.S. medical schools. Similar trends were seen this year in family medicine and pediatrics.
In their final year of medical school, students apply and interview for residency programs in their chosen specialty. The Match, a nonprofit group, then assigns them a residency program based on how the applicant and the program ranked each other.
Since 2011, the percentage of U.S.-trained allopathic, or M.D., physicians who have matched into primary care positions has been on the decline, according to an analysis of historical Match data by Kaiser Health News.
But, over the same period, the percentage of U.S.-trained osteopathic and foreign-trained physicians matching into primary care roles has increased. 2019 marks the first year in which the percentage of osteopathic and foreign-trained doctors surpassed the percentage of U.S. trained medical doctors matching into primary care positions.
Medical colleges granting M.D. degrees graduate nearly three-quarters of U.S. students moving on to become doctors. The rest graduate from osteopathic schools, granting D.O. degrees. The five medical schools with the highest percentage of graduates who chose primary care are all osteopathic institutions, according to the latest U.S. News & World Report survey.
Beyond the standard medical curriculum, osteopathic students receive training in manipulative medicine, a hands-on technique focused on muscles and joints that can be used to diagnose and treat conditions. They are licensed by states and work side by side with M.D.s in physician practices and health systems.
Although the osteopathic graduates have been able to join the main residency match or go through a separate osteopathic match through this year, in 2020 the two matches will be combined.
Physicians who are trained at foreign medical schools, including both U.S. and non-U.S. citizens, also take unfilled primary care residency positions. In the 2019 match, 68.9% of foreign-trained physicians went into internal medicine, family medicine and pediatrics.
But, despite osteopathic graduates and foreign-trained medical doctors taking up these primary care spots, a looming primary care physician shortage is still expected.
The Association of American Medical Colleges predictsa shortage of between 21,100 and 55,200 primary care physicians by 2032. More doctors will be needed in the coming years to care for aging baby boomers, many of whom have multiple chronic conditions. The obesity rate is alsoincreasing, which portends more people with chronic health problems.
Studies have shown that states with a higher ratio of primary care physicians have better health and lower rates of mortality. Patients who regularly see a primary care physician also have lower health costs than those without one.
But choosing a specialty other than primary care often means a higher paycheck.
According to a recently published survey of physicians conducted by Medscape, internal medicine doctors' salaries average $243,000 annually. That's a little over half of what the highest earners, orthopedic physicians, make with an average annual salary of $482,000. Family medicine and pediatrics earn even less than internal medicine, at $231,000 and $225,000 per year, respectively.
Dr. Eric Hsieh, the internal medicine residency program director at the University of Southern California's Keck School of Medicine, said another deterrent is the amount of time primary care doctors spend filling out patients' electronic medical records.
"I don't think people realize how involved electronic medical records are," said Hsieh. "You have to synthesize everything and coordinate all of the care. And something that I see with the residents in our program is that the time spent on electronic medical records rather than caring for patients frustrates them."
The Medscape survey confirms this. Internists appear to be more burdened with paperwork than other specialties, and 80% of internists report spending 10 or more hours a week on administrative tasks.
The result: Only 62% of internal medicine doctors said they would choose to go into their specialty again — the lowest percentage on record for all physician specialties surveyed.
Elsa Pearson, a health policy analyst at Boston University, said one way to keep and attract primary care doctors might be to shift some tasks to health care providers who aren't doctors, such as nurse practitioners or physician assistants.
"The primary care that they provide compared to a physician is just as effective," said Pearson. They wouldn't replace physicians but could help lift the burden and free up doctors for more complicated care issues.
Pearson said more medical scribes, individuals who take notes for doctors while they are seeing patients, could also help to ease the doctors' burden of electronic health record documentation.
Another solution is spreading the word about the loan forgiveness programs available to those who choose to pursue primary care, usually in an underserved area of the country, said Dr. Tyree Winters, the associate director of the pediatric residency program at Goryeb Children's Hospital in New Jersey.
"The trend has been more so thinking about the amount of debt that a student has, compared to potential income in primary care," said Winters. "But that's not considering things like medical debt forgiveness through state or federal programs, which really can help individuals who want to choose primary care."
KHN data correspondent Sydney Lupkin contributed to this report.
The California agency that regulates doctors is investigating at least four physicians for issuing questionable medical exemptions to children whose parents did not want them immunized.
The Medical Board of California's investigations are unfolding amid the nation's worst measles outbreak in more than a quarter-century, as California lawmakers consider controversial legislation to tighten the requirements for exempting children from the vaccinations required to attend schools and day care centers.
Last month, the Department of Consumer Affairs, which oversees the medical board, sued in state court to obtain medical records for patients of Sacramento-area pediatricians Dr. Kelly Sutton and Dr. Michael Fielding Allen.
In the past nine months, the board also has sought patients' records in connection with two Santa Rosa physicians under investigation for writing allegedly inappropriate exemptions.
The state acted on the Sutton and Allen cases following complaints to the medical board from Dr. Wendy Cerny, assistant chief of pediatrics at a Kaiser Permanente clinic in Roseville, court documents show. (Kaiser Health News, which produces California Healthline, is not affiliated with Kaiser Permanante.) Cerny contacted the board about Sutton in February 2017 and followed up with an email about Allen 15 months later, according to the documents.
Cerny became concerned after seeing permanent medical exemptions for Kaiser Permanente pediatric patients written by Sutton and Allen that cited reasons including "a personal history of genetic defect," food and environmental allergies, "neurological vulnerability" and a family history of mental health disorders, according to the legal documents.
The doctors under investigation are not Kaiser Permanente doctors, but parents went to them for vaccination exemptions. In one case, Sutton issued a "lifelong medical exemption from all vaccines" to a boy before his family joined Kaiser Permanente, according to Cerny's complaint. When one of Cerny's colleagues refused to write similar exemptions for the boy's two younger siblings, the mother said she would go back to Sutton to get them, the complaint says.
"We feel this doctor and perhaps her colleagues … are making easy money on these exemptions that are not based on true medical need and are actually putting children and other people in the community at risk for contracting and spreading serious infectious diseases," Cerny wrote in her complaint about Sutton.
A physician appointed by the medical board to review exemptions issued by Sutton and Allendescribed them as "either of questionable validity or patently without medical basis."
Vaccine exemptions for medical reasons should be rare, according to the Centers for Disease Control and Prevention. They are typically reserved for children with severely compromised immune systems, like those being treated for cancer or those who are allergic to a vaccine component or have previously had a severe reaction to a vaccine.
A spokesman for the medical board declined to comment on the cases. The agency generally does not acknowledge investigations publicly unless a formal accusation is filed against a physician.
But the board's legal efforts to obtain patient records sheds rare light on how the agency handles such complaints.
It "tells me that there are doctors who are giving problematic exemptions and the Medical Board of California is taking this issue very seriously," said Dorit Reiss, a professor at University of California-Hastings College of the Law in San Francisco who researches vaccine law.
Sutton and Allen did not respond to phone calls and emails seeking comment.
Sutton, based in Fair Oaks, is known as a go-to doctor for medical vaccine exemptions. She offers a $97 "program" that purports to "help protect your child from the 'One Size Fits All' California vaccine mandate."
Cerny submitted copies of exemption letters by Sutton and Allen in the complaints she filed with the medical board, but the names of the patients were blacked out. The board wants the names of those children and their parents, and it asked the court to compel the Permanente Medical Group, a subsidiary of Kaiser Permanente, to hand over unredacted versions of the letters.
The board also wants Kaiser Permanente to hand over the patients' medical charts, which it believes will help determine whether the exemptions written by Sutton and Allen were indeed unmerited.
In June, Superior Court Judge Ethan Schulman ordered the Permanente Medical Group to disclose the names of the patients known to have received medical exemptions from Allen, as well as the names and addresses of their parents. He has not yet issued a ruling in the Sutton case.
Kaiser Permanente said it would comply with court orders.
"We take the health and safety of our members, patients and communities very seriously," said Dr. Stephen Parodi, associate executive director of the Permanente Medical Group, via email.
In a case similar to Sutton's and Allen's, a judge orderedthe Permanente Medical Group in November to provide the names of patients and parents subpoenaed in a medical board investigation of Dr. Kenneth Stoller, a Santa Rosa physician who gave vaccine exemptions to children who were Kaiser Permanente patients, as well as to others in the Mammoth Unified School District.
Stoller, who is not affiliated with Kaiser Permanente, is also being investigated by the city attorney of San Francisco, where he used to practice. He didn't respond to a request for comment.
In April, Judge Schulman granted a petition from the state ordering Dr. Ron Kennedy to hand over the medical records of children to whom he had issued vaccination exemptions. Kennedy, a psychiatrist who runs an anti-aging clinic in Santa Rosa, has written numerous exemptions for kids, according to court records.
Kennedy's lawyer, Michael Machat, said his client has handed over the records as ordered.
"The medical board has adopted the practice of thinking it can invade people's privacy and search children's private medical records to see whether or not the doctors are following the law," Machat said. "Where does this stop?"
To date, the only doctor sanctioned for inappropriate medical vaccine exemptions is Southern California pediatrician Robert Sears, the well-known author of "The Vaccine Book."
In 2015, California banned all philosophical and religious exemptions for immunizations in the wake of a large measles outbreak that originated at Disneyland. It is one of four states to have done so, and its vaccination rate rose sharply for three years after the law was tightened. But vaccination rates have declined in the past two years, in part because many parents opposed to vaccines have found doctors willing to write questionable medical exemptions — sometimes for a fee.
California's vaccination policies are once again drawing national attention in the wake of the nation's recent measles outbreak, which totaled 1,095 cases as of June 27. In California, 55 cases were reported as of June 26.
A bill pending in the California legislature, SB-276, would impose more oversight on vaccine exemptions written by doctors. After it passed the state Senate in May, it was softened to appeaseGov. Gavin Newsom but would still allow the state Department of Public Health to review some exemptions. It also would prevent doctors who are under investigation for writing unwarranted exemptions from issuing new ones.
Newsom has said he will sign the legislation if it lands on his desk.
AMA President Patrice Harris said the organization had to take a stand because new laws forced the small number of doctors who perform abortions to lie to patients.
This article was first published on Monday, July 1, 2019 in Kaiser Health News.
The American Medical Association is suing North Dakota to block two abortion-related laws, the latest signal the doctors' group is shifting to a more aggressive stance as the Trump administration and state conservatives ratchet up efforts to eliminate legal abortion.
The group, which represents all types of physicians, has tended to stay on the sidelines of many controversial political issues, and until recently has done so concerning abortion and contraception. Instead, it has focused on legislation that affects the practice and finances of large swaths of its membership.
But, said AMA President Patrice Harris in an interview, the organization felt it had to take a stand because new laws forced the small number of doctors who perform abortions to lie to patients, putting "physicians in a place where we are required by law to commit an ethical violation."
One of the laws, set to take effect Aug. 1, requires physicians to tell patients that medication abortions — a procedure involving two drugs taken at different times — can be reversed. The AMA said that is "a patently false and unproven claim unsupported by scientific evidence." North Dakota is one of several states to pass such a measure.
The AMA, along with the last remaining abortion clinic in the state, is also challenging an existing North Dakota law that requires doctors to tell pregnant women that an abortion terminates "the life of a whole, separate, unique, living human being." The AMA said that law "unconstitutionally forces physicians to act as the mouthpiece of the state."
It's the second time this year the AMA has taken legal action on an abortion-related issue. In March, the group filed a lawsuit in Oregon in response to the Trump administration's new rules for the federal family planning program. Those rules would, among other things, ban doctors and other health professionals from referring pregnant patients for abortions.
"The Administration is putting physicians in an untenable situation, prohibiting us from having open, frank conversations with our patients about all their healthcare options — a violation of patients' rights under the [AMA] Code of Medical Ethics," wrote then-AMA President Barbara McAneny.
It's an unusually assertive stance for a group that has taken multiple positions on abortion-related issues over the years.
Mary Ziegler, a law professor at Florida State University who has written several books about abortion, said that the AMA's history on abortion is complicated. In general, she said, the AMA "didn't want to get into the [abortion] issue because of the political fallout and because historically there have been doctors in the AMA on both sides of the issue."
In recent years, the AMA has taken mostly a back seat on abortion issues, even ones that directly addressed physician autonomy, leaving the policy lead to specialty groups like the American College of Obstetricians and Gynecologists, which has consistently defended doctors' rights to practice medicine as they see fit when it comes to abortion issues.
In its earliest days, the AMA led the fight to outlaw abortion in the late 1800s, as doctors wanted to assert their professionalism and clear the field of "untrained" practitioners like midwives.
Abortion was not an issue for the group in the first half of the 20th century. The AMA became best known for successful fights to fend off a national health insurance system.
Leading up to Roe v. Wade, the 1973 Supreme Court decision that legalized abortion nationwide, the AMA softened its opposition. In 1970, the AMA board called for abortion decisions to be between "a woman and her doctor." But the organization declined to submit a friend-of-the-court brief to the high court during its consideration of Roe.
In 1997, the AMA, in a surprise move, endorsed a GOP-backed measure to ban what opponents called "partial-birth abortions," a little-used procedure that anti-abortion forces likened to infanticide. A year later, however, an audit of the AMA's leadership found its trustees had "blundered" in endorsing the bill and had contradicted long-standing AMA policy.
One reason the organization may be moving on the issue now could be the shifting parameters of the abortion debate itself. In 1997, the abortion procedure ban that the AMA endorsed "polled well and allowed abortion opponents to paint the other side as extremist," Ziegler said.
Exactly the opposite is true today, she said, as states pass abortion bans more sweeping than those seen at any time since Roe v. Wade. Yet most public opinion polls show a majority of Americans want abortion to remain legal in many or most cases.
"As abortion opponents take more extreme positions, the AMA is probably a little more comfortable intervening" Ziegler added.
Molly Duane, a lawyer from the Center for Reproductive Rights who is arguing the case for the AMA and North Dakota's sole remaining abortion clinic, said the laws being challenged are "something all doctors should be alarmed by. … This is an unprecedented act of invading the physician-patient relationship and forcing words into the mouths of physicians."
As the rural town of Fort Scott, Kan., grapples with the closure of its hospital, cancer patients face new challenges as they try to continue their treatments in different locations.
This article was first published on Monday, July 1, 2019 in Kaiser Health News.
FORT SCOTT, Kan. — One Monday in February, 65-year-old Karen Endicott-Coyan gripped the wheel of her black 2014 Ford Taurus with both hands as she made the hour-long drive from her farm near Fort Scott to Chanute. With a rare form of multiple myeloma, she requires weekly chemotherapy injections to keep the cancer at bay.
She made the trip in pain, having skipped her morphine for the day to be able to drive safely. Since she sometimes "gets the pukes" after treatment, she had her neighbor and friend Shirley Palmer, 76, come along to drive her back.
Continuity of care is crucial for cancer patients in the midst of treatment, which often requires frequent repeated outpatient visits. So when Mercy Hospital Fort Scott, the rural hospital in Endicott-Coyan's hometown, was slated to close its doors at the end of 2018, hospital officials had arranged for its cancer clinic — called the "Unit of Hope" — to remain open.
Then "I got the email on Jan. 15," said Reta Baker, the hospital's CEO. It informed her that Cancer Center of Kansas, the contractor that operated and staffed the unit, had decided to shut it down too, just two weeks later.
"There are too many changes in that town" to keep the cancer center open, Yoosaf "Abe" Abraham, chief operating officer of the Cancer Center of Kansas, later told KHN. He added that patients would be "OK" because they could get treated at the center's offices in Chanute and Parsons.
From Fort Scott, those facilities are 50 and 63 miles away, respectively.
For Endicott-Coyan and dozens of other cancer patients, the distance meant new challenges getting lifesaving treatment. "You have a flat tire, and there is nothing out here," Endicott-Coyan said, waving her arm toward the open sky and the pastures dotted with black Angus and white-faced Hereford cattle on either side of the shoulderless, narrow highway she now must drive to get to her chemo appointment.
Nationwide, more than 100 rural hospitals have closed since 2010. In each case, a unique but familiar loss occurs. Residents, of course, lose healthcare services as wards are shut and doctors and nurses begin to move away.
But the ripple effect can be equally devastating. The economic vitality of a community takes a blow without the hospital's high-paying jobs and it becomes more difficult for other industries to attract workers who want to live in a town with a hospital. Whatever remains is at risk of withering without the support of the stabilizing institution.
The 7,800 residents of Fort Scott are reeling from the loss of their 132-year-old community hospital that was closed at the end of December by Mercy, a St. Louis-based nonprofit health system. Founded on the frontier in the 19th century and rebuilt into a 69-bed modern facility in 2002, the hospital had outlived its use, with largely empty inpatient beds, the parent company said. For the next year, Kaiser Health News and NPR will track how its citizens fare after the closure in the hopes of answering pressing national questions: Do citizens in small communities like Fort Scott need a traditional hospital for their health needs? If not a hospital, what then?
Traveling The Distance For Cancer Care
Reta Baker, the hospital's president who grew up on a farm south of Fort Scott, understood that the hospital's closure was unavoidable. She scrambled to make sure basic healthcare needs would be met. Mercy agreed to keep the building open and lights on until 2021. And Baker recruited a federally qualified health center to take over four outpatient clinics, including one inside the hospital; former employees were bought out and continue to operate a rehabilitation center; and the nonprofit Ascension Via Christi Hospital in Pittsburg reopened the emergency department in February.
As Fort Scott deals with the trauma of losing a beloved institution, deeper national questions underlie the struggle: Do small, rural communities need a traditional hospital at all? And if not, how will they get the healthcare they need?
But cancer care in rural areas, which requires specialists and the purchase and storage of a range of oncology drugs, presents unique challenges.
Rural cancer patients typically spend 66% more time traveling each way to treatment than those who live in more urban areas, according to a recent national survey by ASCO, the American Society of Clinical Oncology. Dr. Monica Bertagnolli, a cattle rancher's daughter who is now chair of ASCO's board, called this a "tremendous burden." Cancer care, she explained, is "not just one visit and you're done."
ASCO used federal data to find that while about 19% of Americans live in rural areas, only 7% of oncologists practice there.
People in rural America are more likely to die from cancer than those in the country's metropolitan counties, according to a Centers for Disease Control and Prevention report in 2017. It found 180 cancer deaths per 100,000 people a year in rural counties, compared with 158 deaths per 100,000 in populous metropolitan counties.
The discrepancy is partly because habits like smoking are more common among rural residents, but the risk of dying goes beyond that, said Jane Henley, a CDC epidemiologist and lead author of the report. "We know geography can affect your risk factors, but we don't expect it to affect mortality."
From an office inside a former Mercy outpatient clinic, Fort Scott's cancer support group, Care to Share, continues its efforts to meet some of the community's needs — which in some ways have increased since the Unit of Hope closed. It provides Ensure nutritional supplements, gas vouchers and emotional support to cancer patients.
Lavetta Simmons, one of the support group's founders, said she will have to raise more money to help people pay for gas so they can drive farther to treatments. Last year, in this impoverished corner of southeastern Kansas, Care to Share spent more than $17,000 providing gas money to area residents who had to travel to the Mercy hospital or farther away for care.
The group expects to spend more on gas this year, having spent nearly $6,000 during the first four months of 2019.
And the reserves of donated Ensure from Mercy are running out, so Simmons is reaching out to hospitals in nearby counties for help.
With Mercy Hospital Fort Scott closed, the likelihood of residents here dying from their cancer will grow, experts worry, because it's that much harder to access specialists and treatments.
Krista Postai, who took over the Fort Scott hospital's four primary care clinics, said it's not unusual for her staff to "see someone walk in [with] end-stage cancer that they put off because they didn't have money, they didn't have insurance, or it's just the way you are. … We wait too long here."
'If They Can't Cure Me, I'm Done'
Art Terry, 71, a farmer and Vietnam veteran, was one of them. Doctors discovered Terry's cancer after he broke a rib while bailing hay. When they found a mass below his armpit, it was already late-stage breast cancer that had metastasized to his bones.
With his twice-weekly chemotherapy treatment available in the "Unit of Hope," Terry spent hours there with his son and grandchildren telling stories and jokes as if they were in their own living room. The nurses began to feel like family, and Terry brought them fresh eggs from his farm.
"Dad couldn't have better or more personalized care anywhere," said his son, Dwight, bleary-eyed after a factory shift.
Terry knew it was difficult to find trustworthy cancer care. The shortage of cancer specialists in southeastern Kansas meant that many, including Mercy Hospital Fort Scott's patients, counted on traveling oncologists to visit their communities once or twice a week.
Wichita-based Cancer Center of Kansas has nearly two dozen locations statewide. It began leasing space in Fort Scott's hospital basement in the mid-2000s, the center's Abraham said. The hospital provided the staff while the Cancer Center of Kansas paid rent and sent roving oncologists to drop in and treat patients.
When Art Terry was diagnosed, his son tried to talk to him about seeking treatment at the bigger hospitals and academic centers in Joplin, Mo., or the Kansas City area. The elder Terry wasn't interested. "He's like, 'Nope,'" Dwight Terry recalled. "I'm going right there to Fort Scott. If they can't cure me, I'm done. I'm not driving.'"
In the end, as the elder Terry struggled to stay alive, Dwight Terry said he would have driven his father the hour to Chanute for treatment. Gas — already a mounting expense as they traveled the 20 miles from the farm near tiny Prescott, Kan., to Fort Scott — would be even more costly. And the journey would be taxing for his father, who traveled so little over the course of his life that he had visited Kansas City only twice in the past 25 years.
As it turned out, the family never had to make a choice. Art Terry's cancer advanced to his brain and killed him days before the hospital's cancer unit closed.
What Happens Next?
As Endicott-Coyan and her friend Palmer drove to Chanute for treatment, they passed the time chatting about how the hospital's closure is changing Fort Scott. "People started putting their houses up for sale," Palmer said.
Like many in Fort Scott, they had both spent their days at the Fort Scott hospital. Endicott-Coyan worked in administration for more than 23 years; Palmer volunteered with the auxiliary for six years.
The hospital grew with the community. But as the town's fortunes fell, it's perhaps no surprise that the hospital couldn't survive. But the intertwined history of Mercy and Fort Scott is also why its loss hit so many residents so hard.
Fort Scott began in 1842 when the U.S. government built a military fort to help with the nation's westward expansion. Historians say Fort Scott was a boomtown in the years just after the Civil War, with its recorded population rising to more than 10,000 as the town competed with Kansas City to become the largest railroad center west of the Mississippi. The hospital was an integral part of the community after Sisters of Mercy nuns opened a 10-bed hospital in 1886 with a mission to serve the needy and poor. Baker, Mercy Hospital Fort Scott's president, said the cancer center was an extension of that mission.
The Unit of Hope began operating out of the newest hospital building's basement, which was "pretty cramped," Baker said. As cancer treatments improved, it grew so rapidly that Mercy executives moved it to a spacious first-floor location that had previously been the business offices.
"Our whole purpose when we designed it was for it to be a place where somebody who was coming to have something unpleasant done could actually feel pampered and be in a nice environment," Baker said.
The center, with its muted natural grays and browns, had windows overlooking the front parking lot and forested land beyond. Every patient could look out the windows or watch their personal television terminal, and each treatment chair had plenty of space for family members to pull up chairs.
When Endicott-Coyan and Palmer arrived at the Cancer Center of Kansas clinic in Chanute in February, things looked starkly different. Patients entered a small room through a rusted back door. Three brown infusion chairs sat on either side of the entry door and two television monitors were mounted high on the walls. A nurse checked Endicott-Coyan's blood pressure and ushered her back to a private room to get a shot in her stomach. She was ready to leave about 15 minutes later.
The center's Abraham said the Chanute facility is "good for patients for the time being" and not a "Taj Mahal" like Mercy's Fort Scott hospital building, which he said was too expensive to maintain. Cancer Center of Kansas plans to open a clinic at a hospital in Girard, which is about 30 miles from Fort Scott, he said.
Some oncology doctors would say driving is not necessary. Indeed, a few healthcare systems across the country, such as Sanford Health in South Dakota and Thomas Jefferson University Hospitals in Pennsylvania, are administering some chemotherapy in patients' homes. Oncologist Adam Binder, who practices at Thomas Jefferson in Philadelphia, said "over 50% of chemotherapy would be safe to administer in the home setting if the right infrastructure existed."
But the infrastructure — that is, the nurses who would travel to treat patients and a reimbursement model to pay for such care within our complex healthcare system — is not yet in place.
Back in the car, Palmer took the wheel and Endicott-Coyan began planning for future cancer treatments in the void left by Mercy Hospital Fort Scott's closure. "I put a note on Facebook today and said, 'OK, I have drivers for the rest of February; I need drivers for March!'"
This is the first installment in KHN's year-long series, No Mercy, which follows how the closure of one beloved rural hospital disrupts a community's healthcare, economy and equilibrium.
Seeking a solution to the soaring costs of drugs, Colorado, Florida and Vermont are making plans to import medications from Canada, where prescriptions are cheaper.
President Donald Trump has offered his support, marking the first time drug importation has won a presidential endorsement.
The states' plans are in their infancy. But they signal how frustration among consumers — especially those shouldering greater portions of their health bills through high-deductible health plans — is putting pressure on federal and state officials.
Because so many details are still being hashed out, it's not yet clear who would be helped by the states' efforts or if the plans can ultimately gain federal approval and withstand likely court challenges.
In the early 2000s, attempts by a few states, led by Illinois, to allow drug importation fizzled, and any new plan faces stiff regulatory and legal hurdles. But drug prices are at an all-time high. The increasing popularity of high-deductible plans means a growing number of patients are spending more money on health care. And Trump's endorsement and current consumer demand for lowering drug prices could yield a different result this time around.
"Everyone is eager to get going into uncharted territory," said Trish Riley, executive director of the National Academy for State Health Policy, a nonpartisan group of state health officials, which has been working with Vermont on its importation plan.
Gabriel Levitt, president of PharmacyChecker.com, which verifies online foreign pharmacies for customers, said the high prices for drugs make the efforts worth pursuing.
"It certainly will be helpful to reduce costs for some in the states that go ahead, and that's a great start," he said. Plus, he added, Trump's support "puts the wind at the sails of importation."
Tempering Expectations
The 2003 Medicare Modernization Act allows states to import cheaper drugs from Canada but only the Health and Human Services secretary verifies their safety. Previous attempts by states to allow importation failed because the secretary opposed them.
Vermont, Florida and Colorado plan to work together to set up a program to buy drugs from Canada, said Riley. That coalition of states — with governors from the center, right and left — shows how powerful the issue of high-priced drugs is with voters.
The same medicines are often cheaper in other countries than the U.S. since most developed countries negotiate with drugmakers to set prices.
State officials said they expect that the effect of their programs would be modest to start, generally first permitting the importation of only certain types of high-priced drugs and for specific populations.
For example, infusion medicines used for cancer or autoimmune diseases that are administered in medical offices would not be available to import from Canada under the programs the states are setting up. Nor would drugs such as insulin, which needs to be refrigerated. Prices for these types of drugs have come under fire in the U.S., with patients calling them unaffordable.
"It's a few states and a few drugs," Riley said.
No Tampering With Safety
Vermont, which passed legislation to start planning the program a year ago, is still trying to find a way to ensure the safety of imported drugs and so far has identified only 17 medicines that would save enough money to be worth bringing over the border. Those drugs include treatments for conditions including diabetes, hepatitis C, cancer and HIV/AIDS.
After a review, officials decided it was not worth importing drugs for Medicaid enrollees because the state already receives hefty rebates on those medications from U.S. manufacturers and patients do not have copayments. So Vermont's program is being designed to help residents who have commercial insurance.
Florida's legislature authorized a blueprint this spring with a strong endorsement from Republican Gov. Ron DeSantis. The program aims to help bring down drug costs for the Medicaid program, which covers the more than 4 million enrollees in the state, prisoners and patients at free health clinics. The legislature also authorized a separate program that would provide drugs for individual Florida residents.
DeSantis signed the bill June 11 and called on federal officials to "get this done."
Colorado approved its legislation in May, but state officials said they do not yet have details on what it might cover.
Officials in all three states have high hopes that the programs will succeed in ways not possible the last time around.
Between 2004 and 2009, Illinois, Kansas, Missouri, Rhode Island and Vermont defied the federal government and allowed residents to import from a Canadian retail pharmacy under a joint program, which flopped. Just 5,000 people participated, far fewer than the millions predicted, partially because the federal government declared the program violated federal law and warned against using the drugs. Also, in 2006, it established a Medicare drug benefit to help those 65 and older, further weakening demand.
Besides, after several years, the Canadian health minister threatened to prohibit pharmacies from participating over concerns that the program might cause shortages, and the main Canadian supplier pulled out due to lack of demand.
In 2014, Maine briefly allowed residents and employers to buy foreign drugs. Under that law, some employers, including the city government of Portland, established a program for workers to use CanaRx, a Canadian company that connects customers with brick-and-mortar pharmacies in Canada, Great Britain and Australia.
After pharmaceutical manufacturers and pharmacists sued, a federal judge overturned the law in early 2015, citing its conflict with federal law.
Then and now, opponents of importation say sending drugs over the border will increase the chances Americans get counterfeit medications, a claim often boosted by the drug industry. Levitt noted that states now intend to work directly with and inspect Canadian wholesalers, which should make Americans more comfortable about drug safety.
With prices so high, individual Americans are more open to buying drugs from Canada, anyway — some have for decades been driving over the border, using online pharmacies or going into storefronts that connect buyers to pharmacies in Canada and other countries. Although these strategies are technically illegal, the government does not prosecute individual offenders. Nor has it moved to stop the dozens of cities, counties and school districts across the United States who have programs for employees to buy drugs from Canada and other countries.
Canadian health officials are watching the debate and said they are weighing the effect a robust importation program would have on Canadian consumers.
"Collaborative efforts among implicated parties would be important in addressing any potential adverse impacts on the drug supply in Canada that may arise from increased cross-border trade," said Eric Morrissette, a spokesman for Health Canada, the government agency responsible for public health.
As House Democrats hash out a proposal empowering the federal government's top health official to negotiate lower drug prices, House Speaker Nancy Pelosi is taking it a step further and pushing a plan that could benefit even those Americans with private health insurance.
A draft plan spearheaded, but not yet released, by Pelosi and other House Democratic leaders would ensure that prices negotiated on the most expensive drugs would apply not only to the government but to all payers, including employers and insurers, a Democratic aide said.
But first, Democrats must agree on how best to muscle drug companies to the negotiating table, as well as how to prevent Americans from paying more or even losing access to the other drugs they take. Pelosi has faced pressure from progressive House Democrats, who have pushed for a more aggressive approach, including opening up all drugs to negotiations.
However bold a plan Democrats produce, any proposal to invite the federal government into price negotiations looks doomed in the Republican-controlled Senate, where GOP leaders have said they will not let it advance.
That means the fight over whether the government should cut deals with drugmakers is likely to play out on the members' 2020 election campaign trails, rather than in the halls of Congress. Democrats could again try to tar Republicans as indifferent to the struggles of Americans who cannot afford health care, while promoting their own attempts to fulfill 2018 campaign promises to address skyrocketing drug prices.
Drug prices have been on the rise for decades and,according to the Kaiser Family Foundation, spending on prescription drugs — adjusted for inflation — increased to $1,025 per capita in 2017, from $90 in 1960. (Kaiser Health News is an editorially independent program of the foundation.)
Experts say the lack of competition is much to blame for high drug costs. The federal patent system, in which companies are granted exclusive control of their drug for years and can exploit loopholes to block competitors, frees those firms to charge as much as they like. That can leave patients with no choice but to pay exorbitant prices for the drugs they need.
Under the current system, negotiations are conducted on a plan-by-plan basis between drugmakers and pharmacy benefit managers, the intermediaries who themselves have faced questions about how much they contribute to high drug costs.
Many Democrats argue that the secretary of Health and Human Services should negotiate prices, leveraging the power of the federal Centers for Medicare & Medicaid Services, the largest health care payer in the country.
Though it may change before being released, the current Democratic leadership plan would authorize the HHS secretary to negotiate the prices of the 250 most expensive drugs.
"We want them to address as many as possible, as quickly as possible," Pelosi said at a recent event after progressives pushed her to include more than the 25 drugs she initially proposed targeting.
The negotiation would begin with a price range set by HHS, the Democratic aide said, with the aim of agreeing on the maximum price that could be charged for a drug.
The Government Accountability Office would help sort out disagreements between HHS and drugmakers, although the specifics of that arrangement are still uncertain, the aide added.
Details of how the negotiated drug prices would be transferred to the private sector remain to be seen.
Limiting negotiations to the 250 most expensive drugs would tackle a piece of the drug market that accounts for about 78% of prescription drug spending, according to an analysis conducted by Patients for Affordable Drugs, an advocacy group.
Democratic leaders believe the 250-drug threshold would balance two competing interests, the aide said: maximizing the impact on prescription drug spending, while theoretically keeping the list of negotiable drugs to a number HHS could handle.
Otherwise, faced with more drugs —or all of them — to negotiate, the HHS secretary could reasonably determine that was more than the agency could manage and potentially cherry-pick which drugs to pursue, the argument goes.
An HHS spokesperson declined to answer questions about how such a proposal would look in practice.
The Congressional Budget Office cautioned in May that negotiations would likely be effective at lowering prices only if the HHS secretary were granted "some source of pressure" to use against drugmakers.
Under the Democratic leadership plan, companies that refuse to comply with negotiations would find themselves slapped with an excise tax equivalent to 50% of sales on the drug in the previous year, the aide said.
But some Democrats worry that would not be enough to pressure drug companies to negotiate. A competing proposal, from Rep. Lloyd Doggett (D-Texas) and Sen. Sherrod Brown (D-Ohio) and endorsed by the Congressional Progressive Caucus, would threaten companies with having their drugs' patents expire sooner than planned if they did not comply with the secretary's negotiations on behalf of Medicare beneficiaries.
A second Democratic aide said that proposal, still considered a draft, would cut to the heart of the problem by undermining the drugmakers' exclusivity, while protecting patients' access to prescriptions should pharmaceutical companies walk away from price talks.
"I'm for whichever plan provides the most relief for the most patients and does not allow Big Pharma to dodge responsibility for widespread price-gouging," Doggett said in a statement.
Either plan would be better than the current system, said Gerard Anderson, a health policy professor at Johns Hopkins University in Baltimore who has been advising House Democrats on their proposals.
However, he said, both proposals would require some kind of national formulary — a list of prescription drugs covered by insurance, as determined by the negotiations — to be effective.
"When you're negotiating with a company where there's three other competitors, you need to say 'I'm going to give you an exclusive contract' in order to get a good deal," Anderson said in an interview.
The Veterans Health Administration, which offers retired service members discounts through its negotiations with drugmakers, is often cited by negotiation advocates as a model that could be imitated. It regularly secures drug prices that are about 35% lower than those paid by Medicare beneficiaries, Anderson said.
Unlike Medicare, the Veterans Health Administration has a national formulary.
Although President Donald Trump said during his 2016 campaign that he supports allowing the government to negotiate better drug prices, congressional Republicans broadly oppose the idea.
The HHS secretary is barred from directly negotiating prices with drugmakers for Medicare Part D, the program's prescription drug plan, which covered more than 43 million Americans last year. Instead, the private plans that offer Part D benefits negotiate on their own.
Sen. Chuck Grassley (R-Iowa), chairman of the Finance Committee, said on the Senate floor last month that part of the appeal of Medicare Part D is that seniors can select a plan based on its formulary, allowing them access to the drugs they need.
That choice could disappear if Democrats enable negotiations, he said.
"As the senator who once again chairs the committee with jurisdiction over Medicare policy, I'm not going to let Congress unravel what's right about Medicare Part D," Grassley said.
But the Democratic aide with knowledge of the leadership's proposal dismissed that concern, saying Medicare beneficiaries would keep the option to select the plan that best suits them.
Anderson also said that concern does not hold up, explaining that there is "a huge amount of overlap" between the drugs on the Veterans Health Administration's formulary and those on most Medicare drug plan formularies.
It is unclear when House Democratic leaders might unveil their finished plan, though Pelosi is reportedly determined to do so before the 2020 election heats up.