The FEHBlog

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The FEHBlog

An Ermer Law Group PLLC service providing Federal Employees Health Benefits Program and general health benefits law and policy information — but not legal advice

Tuesday, June 04, 2019

Healthcare Dive reports on CVS Health’s investor announcements today. Of note —

  • CVS Health plans to open 1,500 HealthHUB stores by the end of 2021 as part of its enterprise growth strategy. By the end of this year, the pharmacy chain will expand on its initial three-store Houston pilot program and open additional locations in Houston, Atlanta, Philadelphia, southern New Jersey and Tampa, Florida.
  • HealthHUBs devote about 20% of retail space to health services, focusing on preventive care, wellness activities and education and management of chronic conditions like asthma and diabetes, according to the company.

Humana broke with company policy to not comment on potential merger and acquisition matters to quell rumors of a possible merger with competitor Centene in a recent filing to the Securities and Exchange Commission. The Louisville-based company stated that it “will not make a proposal to combine with Centene as an alternative to Centene’s proposed transaction with WellCare Health Plans, Inc.” Apparently, the negative impact of speculation on the company’s stock was too much to ignore.

Finally, Healthcare Dive also lets us know that “More than 2,800 comments poured in on two wide-reaching HHS rules to promote interoperability and discourage information blocking in healthcare, with industry groups largely lauding the goal but not the means of achieving it.” If at first you don’t succeed, etc.

Monday, June 03, 2019

Monday Musing

Everyone agrees costs for consumers have soared. Drug prices are climbing faster than inflation, a big reason workers’ out-of-pocket expenses for health care leapt 53.5% between 2006 and 2016, according to the Economic Policy Institute. Today, as costs continue to rise, spending on health care makes up nearly 18% of U.S. gross domestic product, more than double health care’s share in 1980. All told, 69% of Americans said reducing health-care costs should be a top priority for the president and Congress, according to a 2019 Pew survey. The number has risen steadily from 59% in 2014.

Because so many people are content with their own coverage, any politician pushing policies deemed too disruptive can easily lose the argument. For all those who worry about the state of health care in the U.S., an even bigger percentage of Americans—4 out of 5, according to Gallup—rate the quality of their health-care coverage as either “excellent” or “good.”

Further Coda to Weekend Update

Sunday, June 02, 2019

Coda to the Weekend Update

  • the bill includes a provision to increase Federal civilian pay by 3.1 percent in 2020, and
  • Office of Personnel Management (OPM) –The bill includes $339 million, an increase of $43.4 million, for OPM. The bill rejects the Administration’s proposed merger of OPM with GSA.

Weekend update

Congress returns to Capitol Hill this week. As Federal News Network noted on Friday. the House Appropriations Subcommittee on Financial Services and General Government will mark up its Fiscal Year 2020 appropriations bill tomorrow evening at 7 pm. This bill includes FEHBP and OPM appropriations, thereby raising the Administration’s OPM reorganization plan.

On Tuesday morning, the House Energy and Commerce Subcommittee on Health will consider a raft load of healthcare bills, including a bill (HR 3030) to continue for another decade the expiring ACA obligation of health plans to fund the Patient Centered Outcomes Research Institute. (The FEHBlog predicted this development.) Meanwhile a bipartisan House bill (H.R. 1398) and a corollary Senate bill (S. 172) to extend the current suspension of the ACA’s onerous health insurance tax for two more years beyond 2019 languish without committee consideration.

Also on Tuesday, according to a Wall Street Journal report,

CVS Health Corp. is expected to defend its acquisition of insurer Aetna Inc. in two high-profile settings Tuesday, seeking to sell skeptical investors and a federal judge on the nearly $70 billion deal.

CVS lawyers are slated to be in a Washington, D.C., federal court for the start of an unusual three-day proceeding in which U.S. District Judge Richard Leon is considering whether the Justice Department adequately protected competition when it approved the deal last year.

In New York, the Woonsocket, R.I.-based health-care company is holding an investor day to discuss its outlook, with analysts looking for evidence that CVS can improve its financial performance amid challenges to its core businesses.

A case in which the Court will decide whether to overrule Auer v. Robbins, 519 U.S. 452 (1997), and Bowles v. Seminole Rock & Sand Co., 325 U.S. 410 (1945), which direct courts to defer to an agency’s reasonable interpretation of its own ambiguous regulation.

The products spotlighted are:

  1. Onasemnogene abeparvovec, a gene therapy under the brand name Zolgensma that was recently approved by the Food and Drug Administration. [This is the drug that the manufacturer has priced at $2.1 million per patient (over five years).]
  2. NKTR-181, an opioid that is designed to be less prone to abuse.
  3. Golodirsen, a treatment for Duchenne muscular dystrophy.
  4. Upadacitinib, a treatment for rheumatoid arthritis.
  5. Tafamidis meglumine, a first-in-class treatment for transthyretin amyloid cardiomyopathy under the brand name Vyndaqel.

Friday, May 31, 2019

As Congress returns to Capitol Hill next Monday, Federal News Network muses on the state of the Administration’s proposed shifting of OPM’s services to the Office of Management and Budget and the General Services Administration. It’s worth a read.

Forbes opines, with supporting evidence, that “The day of solo practitioners is coming to an end . In its place will be gaggles of gastroenterologists and flocks of physicians. Mega practices are becoming the norm in American medical care.”

The Journal of the American Medical Association posits as follows:

Question What are the prices of top-selling brand-name prescription drugs in the United States, and how have these prices changed in recent years?

Findings In this economic evaluation of 49 common top-selling brand-name drugs, 78% of the drugs that have been available since 2012 have seen an increase in insurer and out-of-pocket costs by more than 50%, and 44% have more than doubled in price.

Meaning Prices of brand-name drugs in the United States are likely to continue to increase, which warrants greater price transparency.

Health Payer Intelligence reports that UnitedHealth Group is joining other health plans in offering its health plan members access to the smart phone app TalkSpace.

Through the Talkspace, individuals pay a subscription fee for unlimited messaging with one of the company’s 5,000 contracted healthcare professionals. To date, the telepsychology company has tailored services specifically to teenagers and couples.

UnitedHealth isn’t the only payer working with the telebehavioral company, which provides services to employers as part of commercial agreements with Aetna, New Directions Behavioral Health, and Magellan Health. All told, five million lives have access to these telemental services.

Thursday, May 30, 2019

Thursday Thoughts

The most far-reaching element favored by the White House aides developing the order would require insurers and hospitals to disclose for the first time the discounted rates they negotiate for services, according to health-care lobbyists and policy experts familiar with the deliberations. The idea has stirred such intense industry opposition, however, that it may be dropped from the final version, the sources said.

The article suggests that the executive order may include expanded requirements on hospitals to make their prices public and restrictions on hospital consolidation. The executive order must be implemented through the federal agency rule making process.

On the prescription drug front, the FEHBlog ran across this new IQVIA report about the rapidly growing number of new specialty drugs to treat cancer.

  • Spending on all medicines used in the treatment of patients with cancer reached nearly $150 billion in 2018 up 12.9% for the year, driven by therapeutic drugs, as spending on supportive care drugs declined 1.5% in 2018. * * *
  • Growth in spending on oncology therapeutics through 2023 is forecast at double-digit levels in the United States * * * .

Recently the FEHBlog discussed a New Yor Times article on the “flourishing” use of stem cells to treat various joint problems and illnesses. Today, the Food and Drug Administration issued a press release making it clear that these stem cell treatments must receive FDA approval for marketing.

R3 Stem Cell, LLC of Scottsdale, Arizona, and its chief executive officer, David Greene, M.D. The company, through its affiliated centers or clinics throughout the U.S., offers unapproved stem cell products to treat a variety of diseases and conditions, such as Lyme disease, diabetes, Parkinson’s disease, stroke, kidney failure and amyotrophic lateral sclerosis (ALS). The products offered by R3 Stem Cell, LLC are not approved by the FDA.

The Pain Management Best Practices Inter-Agency Task Force, a federal advisory committee established by the Comprehensive Addiction and Recovery Act of 2016 – PDF, today released its final report on acute and chronic pain management best practices, calling for a balanced, individualized, patient-centered approach.

To ensure best practices for the treatment of pain, the Task Force final report underscores the need to address stigma, risk assessment, access to care and education. It also highlights five broad categories for pain treatment: medications, interventional procedures, restorative therapies, behavioral health, and complementary and integrative health approaches.

“There is a no one-size-fits-all approach when treating and managing patients with painful conditions,” said Vanila M. Singh, M.D., MACM, Task Force chair, and chief medical officer of the HHS Office of the Assistant Secretary for Health. “Individuals who live with pain are suffering and need compassionate, individualized and effective approaches to improving pain and clinical outcomes. This report is a roadmap that is desperately needed to treat our nation’s pain crisis.”

Just 770 employees in an IRS workforce of 80,000 are under the age of 30, Jerry Leach, the agency’s director of human capital analytics and technology, said last week at a panel discussion produced by Government Executive. About 230 employees are under the age of 25. * * * Meanwhile, about 24-to-25% of the IRS workforce is eligible to retire, he added. The IRS isn’t alone.

Not surprisingly given these demographics and the fact that half of the FEHBP’s enrollees are annuitants, the average age of an FEHBP enrollee is around 60. That brings us to the closing highlight — a Kaiser Health News article about a physician who cares for the elderly and wants other doctors to learn how to treat this cadre. Sounds like good advice for health plan customer service staff too.

Tuesday, May 28, 2019

Increasingly, more doctors have been diagnosing “prediabetes,” a health condition in which blood sugar levels are high but not high enough to hit the diabetes threshold. Physicians typically push such patients into exercise programs and urge them to change their diet. “Prediabetes is becoming a more accepted diagnosis” and may be causing an increasing number of patients to improve their health before becoming diabetic, said Dr. Tannaz Moin, a UCLA expert.

This is exactly what should be happening.

The Society for Human Resource Management, of which the FEHBlog is a proud member, called attention to the fact that the Internal Revenue Service had issued 2020 inflation adjustments for high deductible insurance plans and related health savings accounts. And always remember that according to the IRS

A high deductible health plan that is a group health plan will generally be subject to both the out-of-pocket maximum for high deductible health plans under Section 223 and the out- of-pocket maximum for group health plans under Section 1302(c)(1) of the Affordable Care Act (via Section 2706(b) of the Public Health Service Act). If two different out-of-pocket maximum levels apply to a plan, the plan complies with both if it complies with the lower out-of-pocket maximum. Thus, in the case of a high deductible health plan subject to the maximum out-of- pocket limit under Section 223 and the maximum out-of-pocket limit under Section 2706(b) of the Public Health Service Act, the plan must comply with the lower amount. In any event a high deductible health plan must satisfy the maximum out-of-pocket limit under Section 223 in order to be a high deductible health plan supporting an HSA.

Significant price variation is not primarily driven by differences in the underlying cost or quality of care. The complex and fragmented health care delivery system, which includes opaque cost structures and varying treatment protocols, makes it challenging for providers to determine the actual cost of treating their patients.

  • Geographic cost differences have relatively little impact on actual provider price variation.
  • Prices are not predictive of provider quality or patient outcomes.
  • Rather than cost or quality primarily driving price variation, a more likely reason is that health care providers generally are incentivized to use their market power to increase prices, often resulting in overpriced services.

Perhaps health plans and Medicare Part B should stop making geographic adjustments to their negotiated prices.

Employee Benefit News discusses an interesting approach that employers have been adopting — making mental health first aid available to employees. “[M]ental health first aid [is[ a relatively new system of providing employees with basic training on spotting signs of emotional distress and engaging with the troubled individual in what could be a potentially crucial intervention to help the person find treatment.”

Monday, May 27, 2019

Memorial Day Weekend Update

Happy Memorial Day. Congress is on a state/district work period this coming week. Here is a link to the Week in Congress’s report on last week’s actions on the Hill.

The FEHBlog notes the following entry in the Senate executive calendar concerning the President’s nomination of Dale Cabaniss to become OPM Director — “05/15/2019 – Placed on Senate Executive Calendar. Calendar [Item] No. 246. Subject to nominee’s commitment to respond to requests to appear and testify before any duly constituted committee of the Senate.”

Health Affairs blog offers an interesting article about ways to integrate social determinants of health in medical care. According to the article more evidence is needed before settling on a preferred approach. Not surprisingly, doctors want to be reimbursed for such discussions with patients.

The FEHBlog strongly recommends this Avik Roy column about the importance of expanding consumer choice in order to preserve commercial health plans. The FEHB Act is nearing its 60th anniversary of passage. The FEHBP as enacted was a model for consumer choice. It’s a shame that Congress adopted a single payer option instead of the FEHBP model when Medicare and Medicaid were enacted six years later. Again the FEHBlog is encouraging adoption of consumer choice in health plans not FEHBP for all. The FEHBP is an employer sponsored health benefits program not a public program.

Friday, May 24, 2019

The proposed revisions would eliminate $3.2 billion in unneeded paperwork burdens imposed by the 2016 rule. Covered entities report that the 2016 rule requires them to send billions of “tagline” notices each year informing patients and customers of their ability to have “significant documents” translated in at least 15 languages. When HHS adopted the 2016 rule, it projected notice and taglines costs of about $7.2 million in the first five years. Because the 2016 rule did not fully account for printing and mailing costs associated with these notices and taglines, it underestimated the burden of these requirements by over three billion dollars over five years. Instead of requiring regulated health companies to mail billions of paper taglines to mostly English speakers, the money saved could be used to more effectively address individual needs of non-English speakers such as by providing increased access for translators and interpreters.

The above HHS link provides links to the text of, and a fact sheet on, the proposed rule. The proposal will be open for public comment for sixty days after publication in the Federal Register.

The Wall Street Journal reported this morning that

President Trump is expected to release an executive order as early as next week to mandate the disclosure of prices in the health-care industry, according to people familiar with the discussion. The order could direct federal agencies to pursue actions to force a host of players in the industry to divulge cost data, the people said. The administration is also looking at using agencies such as the Justice Department to tackle regional monopolies of hospitals and health-insurance plans over concerns they are driving up the cost of care, according to two people familiar with the discussions. The White House declined to comment on its plans.

Following up on yesterday’s announcement of a HIPAA Privacy and Security Rule alleged violation settlement with a business associate, HHS issued a new Fact Sheet on Direct Liability of Business Associates under HIPAA, a law that was enacted in 2009. Reminders are helpful. Health Data Management discusses implications of the settlement here.

Health Data Management also calls attention to an HHS Office of Inspector General report finding that Medicare accountable care organizations with robust health information technology tools provide better patient care.

“ACOs that used a single electronic health record system across their provider networks were able to share data in real time,” states the OIG’s report. “A small number of ACOs had access to robust health information exchanges, which gave ACOs access to patient data even when patients saw providers outside the ACOs’ networks. Most of the ACOs we visited use data analytics to inform their care coordination by identifying and grouping patients according to the potential severity and cost of their health conditions.”

the Food and Drug Administration on Friday approved the first gene therapy for a type of spinal muscular atrophy, a lifesaving treatment for infants that will also be the most expensive drug in the world. Known as Zolgensma, the gene therapy treats children under 2 years of age with spinal muscular atrophy, an inherited neuromuscular disease that causes progressive loss of muscle function. The most severe form of SMA causes infants to die or rely on permanent breathing support by the age of 2. The disease is caused by a defect in a gene that makes SMN, a protein necessary for the survival of motor neurons. Zolgensma uses a re-engineered virus to deliver a functional copy of the defective gene so that SMN protein can be produced. Novartis is pricing Zolgensma at $2.125 million, or an annualized cost of $425,000 per year for five years, the company said.

This is another reason why it makes sense for small and even mid-sized health plans to consider purchasing specific risk stop loss insurance.

Becker’s reports that the measles outbreak has spread to 25 states in the United States for a total of 880 cases. The Health Affairs Blog offers an article explaining why linking adult vaccines and quality is a public health imperative.

There are currently 13 recommended vaccines on the adult immunization schedule and many additional adult vaccine candidates in the pipeline. Despite proven efficacy and favorable recommendations from the Advisory Committee on Immunization Practices, availability and accessibility of vaccines alone are insufficient to encourage uptake.

Traditional policy levers such as school-entry requirements and the Vaccines for Children program have successfully improved vaccination rates in pediatric populations. For adult populations, however, complex challenges have driven the need for stakeholders to explore alternative solutions. As the country innovates in the areas of health care payment and delivery, quality measurement tied to payment presents a promising lever to drive adult immunization uptake and achieve national population health targets.

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