DCMedical News: January 25, 2018
DCMedical News
Washington, D.C.
Thursday, January 25, 2018
THE BIG STORY TODAY IN HEALTH CARE
Budget battles brew. Majority Whip Sen. Cornyn says at least two more Continuing Resolutions (federal spending to keep government open) will be needed. He noted that the House will not have an immigration bill by February 8, even if the Senate does. Then a second additional “stopgap” would be needed, until March, just prior to the final expiration of the DACA (Deferred Action for Childhood Arrivals) program.
Azar confirmed (55-43). Written Senatorial questioning of Mr. Azar for his confirmation hearing (with Mr. Azar’s answers) was captured by CQ, as follows: Senator Wyden, in two separate questioning sessions (here and here) asked Mr. Azar about opioid plans, patient assistance programs, the impact of “welfare reform” in 1996 and so forth. Senator Grassley (here) questioned Mr. Azar about glucose monitor coverage under Medicare, orthotics and prosthetics and compression garments for lymphedema secondary to cancer surgery. See also questions from Senator Cantwell (here), Hassan (here) and Young (here). Senator Murray’s 43 pages of questions are here. Mr. Azar, a Yale Law graduate, clerked for the late Justice Scalia, was Deputy Secretary under Bush ’43 (2005-2007), most recently President at Lilly USA (and another Indiana figure, with CMS’ Seema Verma and VP Pence).
Left behind: reauthorization of funding for community health centers (CHCs, FQHCs) for two years, permanent repeal of therapy (speech, physical, occupational) caps in Medicare, reauthorization of home visiting program of Medicare for five years, and continuation of the expired Medicare “extenders” (three programs known as special diabetes, teaching health center and National Health Service Corps).
DOCTORS
Doctors and others: health care employment. David Cutler reports in the JAMA Forum on “The Good and Bad News of Health Care Employment,” found here. He writes: “If health care employment is expanding because of additional administrative burdens or because clinical personnel are being hired to perform unnecessary procedures, the additional employment will not be worth the cost. Suspecting that this is the case, economists are wary whenever they see news that health care employment is rising.”
The bad news says Cutler, is that in the medical system in the US in 2016 there were 22 times as many nonphysician and nondentist workers as there were doctors and dentists. Some 17% of them were RNs, 46% other health workers, but 37% were non-medical workers such as business managers and office assistants. In physician offices in 2016 there were 5.8 nonphysician employees for every physician. The comparable numbers for law offices were 1.9 and for accounting 1.8. One big difference not noted by Cutler: neither lawyers nor accountants have the benefit of third party payment (!)
Update on shared savings ACOs (Accountable Care Organizations), from “Health Sprocket” January 23rd: CMS reports 561 ACOs, 124 new in FY2018, 43 having left. Larger sponsors appear, with “Caravan Health” sponsoring 15 of the new ACOs, Community Health Systems (the formerly robust investor-owned chain, fallen low through its acquisition of HMA) sponsoring 14. More than 10 million Medicare patients are “attributed” to the program, with 14,000 providers. 30% of the ACOs are owned by physicians, 82% are in the “non-risk-based track.” But Alan Weil, Health Affairs editor, notes that one of his favorite 2017 articles analyzed Partners HealthCare, (one of the largest “Pioneer” ACOs), and found “high levels of physician and enrollee turnover within the ACO and a modest number of enrollees assigned to each physician.”
HOSPITALS AND HEALTH CARE FACILITIES
Health insurance and moral issues: becoming more closely entwined.
See DCMN 1-23 for discussion of Religious Freedom and Conscience proposals for the HHS Office of Civil Rights.
See DCMN 1-29 for discussion of Kentucky Medicaid waiver, concerning which that state’s Governor Bevin indicates that his purpose is not to save money, but to introduce into the Medicaid program moral issues associated with working. The National Health Law Program (description here) filed suit Wednesday to oppose the Kentucky waiver (complaint here). Now the Bond Buyer of 1-24 reports that “Two Republican lawmakers have asked the U.S. Government Accountability Office to report on the extent to which municipal bonds have been used to finance abortion facilities over the last 20 years and the federal tax liability involved. Sen. James Langford, R-Okla., and Rep. Robert Pittenger, R-N.C., requested the report in a one-page letter sent to Comptroller Gene L. Dodaro, who heads the GAO, on Jan. 18.”
A “feel good” story from The Washington Post, (here) January 23rd, on bipartisan cooperation in Virginia, to attempt the resurrection of a rural critical access hospital, Patrick County, opened in 1962 with, according to the Post, the donations ($.75 cents to a $1 from weekly paychecks for three years) from local textile, tobacco and coal workers.
(Financing of new hospitals in the era which saw rapid growth of private health insurance and then passage of Medicare was often linked to efforts of local steel and coal companies, and especially their unions.)
The hospital reopening is a plus for new Governor Ralph Northam, a practicing physician, and his relations with the minority (Democrat) and majority parties in the Virginia Legislature, both of which were needed on this issue. Key for national consideration: A promise not to link voting for the hospital reopening to voting for Medicaid expansion.
Parenthetically, the health policy community has been impressed by the decline in bad debt for hospitals generally (from more patients with insurance and federal subsidy for copayments) and the commensurate decline in the rate of closure of hospitals in the Medicaid expansion states (see here).
“Red state” senators (from both parties) have been slow to recognize the dependence of their constituents on smaller hospitals. Those hospitals are beleaguered by federal electronic records requirements, reimbursement “experiments” of great complexity, and now the threatened loss of a significant source of physicians for smaller community hospitals, namely immigrants.
HEALTH INSURANCE, MEDICARE, MEDICAID, COMMERCIAL
Managed Medicaid likely to be 2018 flashpoint. “Managed Medicaid,” already controversial in Iowa and Illinois this year, is likely to provoke additional controversy and conflict. “Managed Medicaid” is quite different from “Managed Medicare” (the Medicare Advantage plans, originally known as Medicare Part C), because they have different customers. Whereas the Medicare Advantage or “Managed Medicare” plans compete to attract and enroll seniors, “Managed Medicaid” companies have only one customer, namely the state-client which compels beneficiary enrollment. While Medicare Advantage companies are attempting to add customers by adding benefits, maximizing revenue, “Managed Medicaid” companies are attempting to make a profit by enabling their state-clients to spend less on Medicaid.
“What is it,” you might ask, “that managed Medicaid companies are ‘managing’?” Are they managing risk? Are they managing cost by coordinating care? What they are “managing” for the most part is ‘managing’ to pay less to providers (doctor and hospitals) than would have been paid under Medicaid fee-for-service (FFS). States guard this information, knowing how incendiary its exposure might be. One example on a regulatory docket today for New York State Department of Health’s Public Health and Health Planning Council: the Bronx-Lebanon Hospital Center (here) is paid a per diem of $965 by commercial health insurance FFS plans, $936 by a Medicare managed care plan, $1,112 by Medicaid FFS, $1,139 by Medicare FFS but only $741 by Medicaid managed care. New York is moving to complete “Managed Medicaid,” especially in lower income communities (e.g. central and eastern Brooklyn) where “Managed Medicaid” rates impoverish hospitals that have no compensating higher-pay patients, and where community-based physician practices are nearly non-existent.
EVENTS & MEETINGS
Your January & February Calendar:
January 25: 8:30 a.m. MACPAC, 1800 M. Street, Suite 650, Washington, D.C., continuing January 26
January 29: 8:30 a.m. COGME, at https://hrsa.connectsolutions.com/cogme-council/, also January 30
February 1: 9:00 a.m. Health Affairs, kick-off for cost control series, sponsored by National Pharmaceutical Council
OTHER PUBLICATIONS
DCMN: DC Medical News publishes every day that either the House or the Senate of the U.S. Congress is in session. Publication dates for the remainder of January: 26, 29, 30, 31
To our new readers: This is an independent newsletter, dependent entirely on subscription income, publishing at least every day that one or another House of Congress is in session.
Notes to: Fred Hyde, MD, JD, MBA; fredhyde@aol.com