The federal government has expressed concern that providers of charity for financial assistance to cover health insurance costs might be inappropriately steering patients to marketplace plans instead of Medicare or Medicaid.

This article first appeared February 14, 2017 on Kaiser Health News.

By Michelle Andrews

Every night, Jason Early attaches a catheter in his chest to a machine by his bed that, over the course of nine hours while he sleeps, removes his blood from his body, cleanses it and returns it because his kidneys are no longer able to do the job.

It's been about 18 months since the 28-year-old Dallas resident started getting dialysis after his kidneys failed as a complication from the Type 1 diabetes with which he was diagnosed as a child.

Like many patients with end-stage renal disease, Early, who is completing a bachelor's degree in finance at the University of North Texas at Dallas, turned to a charity for financial assistance to cover his health insurance costs.

Such "third-party payments" by nonprofit groups, health care providers and others are controversial. The federal government has expressed concern that providers and organizations they're affiliated with might be inappropriately "steering" patients to marketplace plans instead of Medicare or Medicaid, for which they are often eligible. The public programs reimburse for the dialysis services at lower rates than most private plans. The efforts by charities have also long been a sore spot with health insurers, who say they encourage sick patients who have expensive health care needs to opt for private coverage.

Insurers suffered a setback recently when a federal judge temporarily blocked a new rule from the Department of Health and Human Services that was set to go into effect Jan. 13. It would require that dialysis centers inform insurers if the centers are making premium payments either directly or indirectly through a third party for people covered by marketplace plans. Insurers would then have the option of accepting or denying the payments.

In granting the preliminary injunction last month, U.S. District Court Judge Amos Mazzant in Sherman, Texas, criticized the government's administrative process for establishing the regulation and said it hadn't considered the benefits of private individual insurance or the fact that the rule would leave thousands of patients without coverage.

Insurers were not pleased. "Inappropriate steering and third-party payments increases costs for all consumers, and it risks harm to patients who are often eligible for public coverage options," said Kristine Grow, a spokesperson for America's Health Insurance Plans, an industry group. "We continue to urge [the Department of Health and Human Services] to prohibit these payments when there is alternative coverage for patients."

But patient advocates were delighted. "We thought this was an important win for dialysis patients because it not only spoke to the procedural elements of the rule but to the substance, the potential of dialysis patients to have their coverage taken away," said Hrant Jamgochian, the chief executive of Dialysis Patient Citizens, an advocacy group and the lead plaintiff in the lawsuit.

Premium assistance has been critical to improving Early's quality of life. "Without the [American Kidney Fund] assistance I would be living to pay my medical costs," he said. "They give me an opportunity to get a breather from medical costs so that I can live my life outside of my illness."

Although some patients, such as Early, are able to undergo dialysis at home, many must spend four hours at a dialysis center three times a week. The process is debilitating and time-consuming.

Many people lose their employer-sponsored health insurance because they are unable to work. Medicare is often an alternative because under the law, people with end-stage renal disease — even those younger than 65 — are generally eligible for coverage.

Others may sign up for private coverage on the exchanges. Some may qualify for Medicaid.

Advocates for kidney patients say coverage on the individual market is better than Medicare for some people. In marketplace plans, the maximum amount that someone can be required to pay out-of-pocket for covered services in 2017 is $7,150. But there's no cap on beneficiaries' spending in Medicare, and patients are on the hook for 20 percent of the cost for doctor visits and other outpatient services such as dialysis. Supplemental "Medigap" plans can help cover out-of-pocket costs, but 23 states don't require insurers to sell those plans to people with end-stage renal disease who aren't yet 65.

Last year, Early bought an Aetna silver plan with a $1,500 deductible and a $6,000 out-of-pocket maximum on the Texas health insurance exchange. The American Kidney Fund paid the $359 monthly premium. The policy covered all of his diabetes drugs and equipment. By the end of the first month of dialysis copayments, Early reached his spending maximum and the plan paid everything after that.

But Aetna exited several marketplaces this year, including Texas, and Early signed up for Medicare in January. Now he's responsible for a $134 monthly Part B premium, $65 for his prescription drug plan and $300 a month in copays for drugs. Medicare doesn't cover the insulin pump he uses, so he'll have to pay $300 monthly out of pocket for that too. At the moment he's also paying $478 each month for the basic Medigap "A" supplemental plan available in Texas to patients younger than 65 with end-stage renal disease. The Medigap plan covers his 20 percent coinsurance payments for dialysis and other outpatient care.

He said he's been told that the American Kidney Fund, a charity that provides assistance to about 20 percent of the more than 450,000 people who are on dialysis and receives funding from dialysis providers, will start picking up his Medigap premiums soon. He hopes so.

"I miss my Aetna plan," he said.

Sixty percent of the people who receive premium assistance from the American Kidney Fund get help with their Medicare or Medigap plans rather than marketplace or other private coverage, said LaVarne Burton, the president and CEO. Even though the judge's order doesn't apply to people in public plans, she hopes it will discourage insurers that are increasingly erecting barriers to third-party payment.

"We want to protect the ability that these individuals have to make the choice that meets their needs," Burton said.

President Donald Trump has acknowledged that the effort to remake the health law could last into next year. Conservatives, however, are pushing back.

This article first appeared February 9, 2017 on Kaiser Health News.

By Julie Rovner

Leading conservative Republicans from the House and Senate say Congress is moving too slowly on efforts to "repeal and replace" the Affordable Care Act. But their potential resistance to compromise—even with other members of their own party—underscores just how hard a task Republicans have set for themselves.

"We think it's time to do something, and that's to get rid of this law," Rep. Jim Jordan, R-Ohio, told reporters at an event sponsored by the conservative Heritage Foundation. "The biggest problem with waiting is that's not what we told the voters."

Sen. Mike Lee, R-Utah, pictured above, one of the leading conservative voices in that chamber, said he will vigorously oppose efforts for Republicans to wait until they have a plan ready to replace the law before they repeal it. "There is a lot less agreement about what comes next," he said. "If we load down the repeal bill with what comes next, it's harder to get both of them passed."

After getting off to a quick start, GOP efforts to dismantle the health law appear to have slowed considerably. House and Senate committees have already missed a deadline of Jan. 27 to write and pass their proposed repeal and replace provisions, although Senate leaders acknowledged early this year that marker would likely not be met. At a party retreat last month, Republicans still seemed uncertain exactly how and when they would proceed.

In an interview that aired just before the Super Bowl, President Donald Trump for the first time acknowledged that the effort to remake the health law could last into next year.

Conservatives, however, are pushing back.

Rep. Mark Meadows, R-N.C., who heads the hard-right House Freedom Caucus, said he recognizes that people are "anxious" about changing the health law. "The quicker we can give them answers, the better off we are," he said.

"Health care gets better and costs less once you repeal Obamacare," said Jordan.

All three said they are sensitive to the needs of health insurers, who are threatening to stop offering coverage in the individual market after this year unless they get a better idea of what rules they will have to follow.

"Every month that goes by we create a heavier burden for insurance companies to figure out," said Meadows.

They insisted that adds imperative to the repeal push.

At a minimum, said Lee, Congress should immediately pass the bill it passed in 2015 that was vetoed by President Barack Obama. That partial repeal would have eliminated the expansion of the Medicaid program for the poor, as well as all the insurance subsidies that help people afford coverage and the taxes that pay for the program.

"If we can get something more aggressive, then great," he said. "But we cannot make progress until we first repeal Obamacare."

Insurers and others, including the Congressional Budget Office, have said that repealing parts of the law without a replacement could plunge the individual insurance market into chaos and increase the number of people without any insurance by 32 million over 10 years.

But the conservatives rejected that characterization. "The chaos the American people are facing right now is related to a set of circumstances put in place by Obamacare," said Lee. "I wish there were a non-chaotic path" to fix it.

Tom Price made dozens of health industry stock trades during a three-year investigation by the Securities and Exchange Commission that focused on the Ways and Means Committee, according to financial disclosure records he filed with the House of Representatives.

This article first appeared February 7, 2017 on Kaiser Health News.

By Marisa Taylor and Christina Jewett

Health and Human Services secretary nominee Tom Price showed little restraint in his personal stock trading during the three years that federal investigators were bearing down on a key House committee on which the Republican congressman served, a review of his financial disclosures shows.

Price made dozens of health industry stock trades during a three-year investigation by the Securities and Exchange Commission that focused on the Ways and Means Committee, according to financial disclosure records he filed with the House of Representatives. The investigation was considered the first test of a law passed to ban members of Congress and their staffs from trading stock based on insider information.

Price was never a target of the federal investigation, which scrutinized a top Ways and Means staffer, and no charges were brought. But ethics experts say Price's personal trading, even during the thick of federal pressure on his committee, shows he was unconcerned about financial investments that could create an appearance of impropriety.

"He should have known better," Richard Painter, former White House chief ethics attorney under President George W. Bush and a professor at the University of Minnesota Law School said of Price's conduct during the SEC inquiry.

As Price awaits a Senate vote on his confirmation, Senate Democrats and a number of watchdog groups have asked the SEC to investigate whether Price engaged in insider trading with some of his trades in health care companies. Price has said he abided by all ethics rules, although he acknowledged to the Senate Finance Committee that he did not consult the House Ethics Committee on trades that have now become controversial.

The SEC's inquiry began in 2013, as it battled Ways and Means for documents to develop its case.

A few weeks ago, the day before President Donald Trump's inauguration, the SEC quietly dropped its pursuit of committee documents without explanation, according to federal court records. No charges were brought against the staffer, Brian Sutter, who is now a health care lobbyist. Sutter's lawyer declined to comment.

Craig Holman, government affairs lobbyist with Public Citizen, described Price's volume of stock trades during the SEC inquiry as "brazen," given the congressman's access to nonpublic information affecting the companies' fortunes.

"The public is seeing this and they really don't like it," said Holman whose watchdog group recently filed complaints about Price's stock trading with both the SEC and the Office of Congressional Ethics.

Trump administration officials and Price have dismissed questions that news reports and lawmakers have raised about stock trades coinciding with official actions to help certain companies, saying Price's brokers chose the stocks independently and all of his conduct was transparent.

After acknowledging that he asked his broker to buy stock in an Australian drug company, he told the Senate Finance Committee that he did not direct his broker to make other trades.

"To the best of my knowledge, I have not undertaken such actions," he wrote in response to finance committee questions. "I have abided by and adhered to all ethics and conflict of interest rules applicable to me."

An analysis of Price's trades shows that he bought health stocks in 2007, the first year Congress financial disclosures are posted online. In 2011, the the first year Price sat on the health subcommittee, he traded no health-related stocks, according to his financial disclosures filed with Congress.

That same year, members were facing public criticism because of a book detailing how they could use inside information and a "60 Minutes" investigation focused on how members and staff could legally use inside information to gain from their own stock trades.

In 2012, President Barack Obama signed the Stop Trading on Congressional Knowledge Act to rein in insider trading by members and require more disclosure. Public watchdog groups suggested at the time that the law would curb the practice.

That year, after his one-year break in health care trades, Price resumed investing in health care companies.

Along with investments in technology, financial services and retail stocks, he also bought and sold stock in companies that could be impacted by actions of his subcommittee, which has a role in determining rates the government pays under the Medicare program.

Health care firms spend heavily to influence members of Congress, lobbying on health matters, funding political campaigns and seeking favor with Medicare officials who decide how much the program will pay for certain drugs and devices. The Food and Drug Administration holds similar power, approving or putting conditions on drug and device use.

Beyond his personal investments in health care companies, Price has also advocated their interests in letters to officials and proposed laws, government records show.

In 2012, disclosure records show Price sold stock in several drug firms, including more than $110,000 worth of Amgen stock. Amgen's stock price had steadily climbed out of a recession-level slump, but Price's sale came a few weeks before the company pleaded guilty to illegally marketing an anemia drug.

By 2013, the health subcommittee was at the center of a major conflict between Medicare, which sets Medicare Advantage rates, and the insurance industry. Medicare issued a notice early that year announcing its intention to reduce Medicare Advantage rates by 2.3 percent as part of a major cost-cutting initiative.

That prompted fierce lobbying by the health insurance industry. Members of Congress, including Price, wrote a letter to Marilyn Tavenner, then acting administrator for the Centers for Medicare & Medicaid Services, protesting the rate cut, saying the decrease would "disadvantage vulnerable beneficiaries with multiple chronic conditions."

Ultimately, Medicare decided not to cut rates but instead, to increase them. Yet an hour before Medicare announced the change, a Height Securities analyst fired off a "flash" report to 200 clients that touched off a surge of trading.

The analyst's report said a political deal was hatched on Capitol Hill to prevent the cuts as a condition for moving forward on Tavenner's confirmation. Medicare officials increased rates by nearly 4 percent, a change that would positively impact the bottom lines of health insurance companies.

The SEC began looking for the leak's source, and within weeks, FBI agents began interviewing staffers at the Ways and Means Committee, court records show.

They discovered communications between Sutter and a health care lobbyist. The HHS Inspector General also began a probe, and federal prosecutors briefly examined the matter activity as well.

As the case unfolded, Price bought more health care-related stocks, according to his financial disclosures. He has testified that his broker directed all of the trades, except for his investments in Innate Immunotherapeutics, an Australian company partly owned by Rep. Chris Collins (R-N.Y.), according to Collins' disclosures. An HHS spokesman said Monday that Price held three broker-directed accounts.

Ethics experts have said that Price should have further distanced himself by placing his assets in a blind trust.

On April 30, 2013, Price bought $2,093 worth of stocks in Incyte, a company that develops cancer drugs; $2,076 in Onyx Pharmaceuticals, a drugmaker that would soon merge with a larger drug firm; and $2,097 in Parexel International, a consultancy that helps drugs and devices win FDA approval, according to the financial disclosure records.

The same day, Price shed shares of Express Scripts, a drug management firm, and Danaher, which makes products hospitals and doctor's offices using for testing and diagnostics. In August of that year, he bought a $2,429 stake in Jazz Pharmaceuticals, which makes sleep and cancer drugs.

On May 6, 2014, the SEC served its first subpoena for the Ways and Means Committee documents. The committee launched a vigorous fight, appealing a federal district judge's ruling that it should comply with the SEC subpoena.

Price continued his health stock trades, including $1,000 to $15,000 in drug firms Amgen, Eli Lilly and Co., Pfizer, Biogen and Bristol-Myers Squibb. He also bought stocks in Aetna, a major health insurer, and Athenahealth, which sells electronic medical record and medical billing software. In 2016, he also increased his investment in Innate Immunotherapeutics.

The purchase became controversial because both he and Collins bought stock in a private placement at a discounted price.

"You're asking for trouble if you have access to nonpublic information about the health care industry and you're buying and selling health care stocks," Painter said.