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Last Build Date: Fri, 30 Sep 2016 15:30:58 +0000


The Payment Reform Landscape: Maternity Care Progress And Stagnation

Fri, 30 Sep 2016 15:30:58 +0000

Improvements in the delivery of health care often stem from costly medical and technological advances, but in maternity care the evidence makes a strong argument that less is more. We can intervene less and spend less money in labor and delivery care while improving the quality of care for women and their babies. Why then is there so much unnecessary intervention and why is it so persistent? The Example of Cesarean Deliveries In 1985, the World Health Organization (WHO) declared there was no scientific justification for cesarean births in more than 10-15 percent of pregnancies. And the evidence continues to support that there is no improvement in mortality for mothers or infants with rates exceeding 10 percent to 19 percent depending on the study. Even though the medical literature suggests that lower rates of cesarean delivery are better for women and children, the actual rates in the United States remain persistently high. In 2014, the Center for Disease Control (CDC) reported that 32.2 percent of U.S. births were cesareans. Even among “low risk” first time mothers (full term singleton pregnancy without breech presentation), more than one in four babies is delivered by cesarean. And large variation among hospitals suggests room for improvement. Progress But there is evidence that strong economic incentives to reduce unwarranted intervention can work in maternity care. Over the past several years, application of financial and other pressures has led to relatively quick reductions in the number of early elective deliveries (EEDs). Cesarean or induced vaginal deliveries before 39 weeks without a medical indication are particularly pernicious because they are performed only for the convenience of the mother, doctor, or hospital staff, and are associated with significant risk of poorer medical outcomes for mothers and babies. In South Carolina, under the leadership of the Birth Outcomes Initiative (SCBOI), they were able to combine the work of the State Medicaid program (DHHS) along with SC’s largest payer, Blue Cross Blue Shield of South Carolina, to implement quality improvement efforts along with a nonpayment policy for non-medically necessary EEDs. The quality improvement effort included establishing a list of The American Collegeof Obstetricians and Gynecologists’ approved indications for early delivery, utilizing two modifiers on the claims forms, tracking rates of EEDs by hospital, and providing each hospital with baseline and quarterly updates. Combining the quality improvement efforts with a nonpayment policy for EEDs, which applies to the hospital and the physician, has enabled SCBOI to reduce the EED rate among South Carolina’s 44 birthing hospitals by 72 percent between the first quarter of 2011 when the Birth Outcomes Initiative was launched, and the third quarter of 2015 (from 9.62 percent to 2.70 percent). Also, 75 percent of the hospitals now boast a 0 percent rate of non-medically necessary EEDs, based on data received from the South Carolina Department of Health and Human Services. (Updated information on this and other SCBOI programs will be available in October at under SCHealthviz). Similar trends can be seen across the country. The rate of EEDs has been declining overall — from 17 percent nationally in 2010 to 2.8 percent in 2016. However, there is still work to be done as experts agree this number should be zero and the work on EEDs hasn’t had much if any impact on the overall rate of cesarean delivery. Stagnation Even in the face of compelling evidence, many commercial health insurance plans have resisted realigning their payment structures in any bold way. When they have changed their approach to payment, most have added quality measures on maternity care into a larger set of measures that they use in broad pay-for-performance programs. Many have focused their efforts on educating expectant mothers and their doctors on the benefits of full-term, spontaneous vaginal births and the dangers of medically un-indicated cesarean deliveries. But these education efforts hav[...]

ACA Round-Up: Appropriations, Battles Over Reinsurance Program Collections, And More

Fri, 30 Sep 2016 13:35:13 +0000

On September 29, President Obama signed a continuing resolution appropriations bill that will fund the government through December 9, 2016, unless a 2017 appropriations bill is passed before that date. The headline is that the bill provides $1.1 billion in funding for combating the Zika virus. But the legislation otherwise continues in place funding for ACA programs at the rates at which they were funded for 2016, subject to a half percent reduction. The continuing resolution retains riders and restrictions imposed by the 2016 appropriations legislation, including restrictions on using HHS administrative funds to fund the risk corridor program, elimination of funding for the Independent Payment Advisory Board, and various reporting requirements for ACA programs. The only new restriction on ACA funding in the bill is a rescission of $168 million in unspent ACA funds that were supposed to be available for funding health coverage in the territories. The continuing resolution otherwise contains no new restrictions on ACA funding or implementation, however. There is no prohibition against the use of the judgment fund to settle risk corridor cases. And there is no requirement that HHS transfer funds from the reinsurance program to the Treasury, another demand of ACA critics (see below). The battle over health care reform will likely be rejoined in Congress after the elections, but the ACA has survived the latest round of congressional action largely unscathed. GAO Sides With Republicans On Treasury Reimbursements From Reinsurance Program Collections; HHS Stands Its Ground The temporary reinsurance program established by section 1341 of the Affordable Care Act was adopted to reinsure health insurers in the individual and small group market for high-cost claims during 2014, 2015, and 2016, the first three years of the health insurance market reforms and the marketplaces. The reinsurance program is funded by contributions collected from insurers and third party administrators of self-insured employer plans, which were supposed to amount to $10 billion for 2014, $6 billion for 2015, and $4 billion for 2016. The program has had a significant effect on individual market premiums, accounting for premium reductions of 10 to 14 percent in 2014, 6 to 11 percent in the 2015, and 4 to 6 percent for 2016, according to the American Academy of Actuaries. The program was also, however, supposed to collect $2 billion each for 2014 and 2015 and $1 billion for 2016 to be deposited in the Treasury. These funds were intended to reimburse the Treasury for the $5 billion spent on the early retiree reinsurance program between 2010 and 2013. HHS set the contribution rate for the insurers and self-insured plans contributing to the program for the three years at a level that it believed would be sufficient to collect the amounts needed to fund the program and reimburse the Treasury, plus cover administrative costs. For 2014, however, HHS collected only $9.7 billion toward the $12.2 billion target, and in 2015 it received only $6.5 of the $8.025 billion needed. CMS had thus to decide how to allocate the funds collected toward the program’s costs. CMS initially stated in its 2014 and 2015 Notice of Benefit and Payment Parameters that in the event of a shortfall it would allocate funds collected pro rata between the reinsurance program and reimbursing the Treasury. When it became clear, however, that there would be an actual shortfall, CMS reconsidered, concluding from its interpretation of the language of section 1341 that the primary purpose of the statute was to provide reinsurance; CMS thus decided that all funds collected up to the amounts specified for the reinsurance program should be allocated to that program rather than to repaying the Treasury. Thus, it forwarded nothing to the Treasury for 2014 and about 0.5 billion for 2015. Congressional Republicans have taken issue with this conclusion, arguing that the statute mandates that HHS reimburse the Treasury. They asked the Government Accountability Office to weigh in o[...]

Fail To Scale: Why Great Ideas In Health Care Don’t Thrive Everywhere

Thu, 29 Sep 2016 17:00:15 +0000

In the world of fine wine, it is well known that some types of wine grapes grow only in very specific climates and ecologies. The concept borrowed from the French is “terroir” (ter-WAHR). Terroir explains why the finest champagne grapes grow only in a small district in northeastern France, characterized by rolling hills and a chalky limestone subsoil that provides a steady level of moisture and imparts a mineral note to the wine’s flavor. Health policy advocates have sought for generations to propagate promising forms of health care organization across the country. Yet one finds repeatedly that some forms of organization that prosper in one part of the country fail to thrive in others. Is it possible that the concept of terroir also applies in health care? The Case Of Kaiser Permanente Kaiser Permanente’s health plans would be a great example. Kaiser has been a darling of health policy advocates such as Alain Enthoven, Paul Ellwood, and others because of its integrated structure, global risk, and salaried employment model of physician practice. Yet, despite repeated federal interventions, beginning with the Health Maintenance Organization Act of 1973, Kaiser only recently exceeded 10 million in enrollment for the first time in its 71 year history. Moreover, 82 percent of that enrollment is in two states—Oregon and California—where Kaiser originated. The percentage of Kaiser’s enrollment that derives from its origin states is basically unchanged in a decade. What was the “terroir” that enabled Kaiser to flourish in these states? Kaiser’s growth rested on a combination of the prevalence of large scale multispecialty group practice, a tradition of prepayment for health services (as opposed to indemnity insurance), and large unionized employers tied to trade, ship building, and defense contracting after World War II. As the unionized sector of employment was displaced by growth in other economic sectors, Kaiser’s substantial presence in large Pacific Coast markets (San Francisco, Sacramento, Portland, Los Angeles, and San Diego) lowered the cost of additional enrollment. Kaiser has presences in other markets like Denver, Hawaii, and the District of Columbia that have grown modestly. But it never achieved West Coast levels of dominance in these markets, and ambitious attempts during the 1990s to become a “national” health insurer ended in costly failure. Independent Practice Associations Kaiser’s dominance in Pacific Coast markets encouraged the growth of another innovation — the risk-bearing Independent Practice Association (IPA). In order to defend their franchises against Kaiser’s steady growth, state medical societies in the 1970s encouraged their members to form rival IPA networks that preserved solo practice. Private practicing physicians using these IPAs and insurgent payers like PacifiCare and HealthNet formed broad regional alliances during the 1980s. IPAs like Hill Physicians, Brown and Toland, and Monarch accepted delegated risk from these health plans through capitated contracts. These IPAs also developed management services organizations that supported small practices and facilitated billing and documentation for these managed care contracts, enabling them to compete for business with the vast Kaiser groups. Delegating risk to physician organized care systems helped some health insurers to keep pace with Kaiser’s growth, at least for a time. Absent the Kaiser threat, it is highly unlikely that these IPAs would have attracted enough physicians willing to support them. One of the most successful of these risk-bearing physician enterprises, HealthCare Partners (HCP), spawned its own salaried multi-specialty group practice and grew to the point where it was acquired by DaVita in 2011 for $4.4 billion. Yet even with a very successful business model, HealthCare Partners has failed to thrive outside the Los Angeles basin. In Albuquerque, Las Vegas, Philadelphia, and Florida, HealthCare Partners has struggled to achieve e[...]

By The Numbers: Our Progress In Digitizing Health Care

Thu, 29 Sep 2016 14:00:20 +0000

Over the past seven years, the United States has seen a historic health IT transformation, moving from a primarily paper-based health system to one where virtually everyone has a digital footprint of their care because of the dramatic uptake of electronic health records (EHRs). Recent data have helped quantify just how rapidly technology has transformed clinical settings. Today, nearly all hospitals (96 percent) and nearly eight in 10 (78 percent) physicians use certified EHRs. This transformation is the result of 2009’s Health Information Technology for Economic and Clinical Health (HITECH) Act, when fewer than one in 10 hospitals and 17 percent of physicians used EHRs. This rapid uptake of technology reflects the unyielding effort by clinicians and health systems across the board who helped usher in this new era of medicine. The result of this effort is a vast amount of electronic health data now exists which simply did not seven years ago. This transformation represents more than simply digitizing paper health records. It also puts us at a global competitive advantage and is leading to real-world impacts in the clinical setting. Systematic reviews of academic literature found that 84 percent of studies showed that certified EHRs had a positive or mixed positive effect on quality, safety, and efficiency of care. Other recent studies found that EHRs can reduce adverse events among cardiovascular, surgery, and pneumonia patients and that switching EHRs did not result in adverse safety events. These results reflect the vision we laid out in two key documents last year when we collaborated with more than 35 federal partners to develop the Federal Health IT Strategic Plan 2015-2020, and joined forces with the private sector to develop A Shared Nationwide Interoperability Roadmap, which outlines milestones, calls to action, and commitments that public and private stakeholders should focus on achieving, particularly in the near-term, to continue making progress. Creating a Learning, Person-Centered Health System These plans recognize that the adoption of health IT is just the first step in ensuring health data flows seamlessly and securely. That is why, in addition to the impressive adoption statistics, we are equally excited that in 2015 more than eight in 10 hospitals electronically exchanged laboratory results, radiology reports, clinical care summaries, or medication lists with ambulatory care providers or hospitals outside their organization — double the percentage from 2008. Looking at advanced measures of exchange, approximately nine out of 10 hospitals that electronically send, receive, find, and integrate information routinely had clinical information they needed from outside sources or providers available at the point of care, which is about double the national average. These plans also reflect an important shift in focus from adoption and use of EHRs, to their role in improving patient experiences and health outcomes. This focus reflects a more comprehensive and integrated use of federal payment, procurement, and policy levers to make electronic health information easily accessible and usable across the care continuum. To that end, we have also observed increases in user satisfaction with EHR systems. In 2013, a survey from Black Book Market Research found more than nine in ten multispecialty groups expressed displeasure with EHR products and developers. When this group conducted a follow-up survey in 2015, they found a dramatic reversal. Last year, 84 percent of providers reported that their EHR is meeting or exceeding their expectations. This is particularly important, as EHR usability has been linked with physician satisfaction. Moreover, seven in eight administrative staff believed that they have seen improvements in the operational or financial capabilities of their practice management and EHR software. Accelerating Interoperability of Health Information Of course, we know there is more work to do before we realize our [...]

A Unified Medicare Payment System For Post-Acute Care Is Feasible

Wed, 28 Sep 2016 15:15:18 +0000

About 40 percent of Medicare beneficiaries discharged from an acute care hospital go on to use post-acute care (PAC) from skilled nursing facilities (SNFs), home health agencies (HHAs), inpatient rehabilitation facilities (IRFs), and long-term care hospitals (LTCHs). Medicare’s payments to the more than 29,000 providers of these services totaled $59 billion (or 20 percent of Medicare fee-for-service spending) in 2014. This care offers important recuperation and rehabilitation services to Medicare beneficiaries, but there are few evidence-based criteria to guide decisions about where beneficiaries should be treated following a hospital stay and how much care they should receive. Congress requested that the Medicare Payment Advisory Commission (MedPAC) recommend features of a unified payment system and consider the effects of moving to such a system. Our work found that a unified payment system is possible and would reduce current distortions. Medicare’s Current Fragmented System For Post-Acute Care Medicare currently pays for services under each of the four settings using different payment systems that involve different units of payment and payment adjustments, despite overlap in the types of patients treated in the settings. As a result, Medicare pays different prices for similar patients depending on where the patient is treated. While similar patients may receive different services depending on which setting they are in, there is limited evidence that the outcomes for patients in high-cost settings differ from those in lower-cost settings. For example, prior work showed significant overlap in the patients treated in SNFs and IRFs for 22 health conditions frequently treated in IRFs but for which the majority of patients are treated in SNF. While payments to IRFs were almost always higher than payments to SNFs, to the extent that outcomes could be measured, they were not consistently better in the high-cost setting. In addition, current payment rules have inherent shortcomings that could be corrected with a unified prospective payment system (PPS) that could span the four PAC settings. Two of the PPSs (HHA and SNF) pay more generously for therapy care (such as physical and occupational therapies) than for medically complex care (such as ventilator care and severe wound care), which drives some providers to focus on therapy patients rather than medically complex patients (such as patients with conditions that involve multiple body systems and patients whose prior hospital stay had a high severity of illness) and to furnish unnecessary services to boost payments. Given the much higher costs of two other settings (LTCH and IRF), Medicare attempts to differentiate this care from other acute and post-acute care with additional requirements. For example, LTCHs must have a minimum length of stay (25 days) and IRFs must meet certain case-mix thresholds and furnish “intensive therapy” to all patients. Designing a New, Unified Payment System Growing concerns over the rapid growth and wide variation in Medicare’s PAC spending and the lack of uniform patient assessments to gauge quality prompted the enactment of the Improving Medicare Post-Acute Care Transformation Act of 2014. This law mandated that in June 2016, the Medicare Payment Advisory Commission (MedPAC) recommend features of a unified payment system that would replace the four individual payment systems that Medicare currently uses. Later, the Act also requires the Secretary of Health and Human Services and MedPAC—using two years of data that will begin to be collected in October 2018—to design a prototype PPS and to make recommendations for implementation of a unified system. These reports are expected in 2022 and 2023. In the course of analyzing potential features of a PAC PPS, we found that a unified payment system is not only feasible, but could be implemented sooner than the timetable outlined in law. As expected, the design would result [...]

CMS Bolsters Outreach To Young Adults As Open Enrollment Nears

Tue, 27 Sep 2016 17:57:44 +0000

On September 27, the Centers for Medicare and Medicaid Services announced a new campaign to enroll young adults in the health insurance marketplaces. The announcement was released as part of the White House Millennial Outreach and Enrollment Summit. Young adults have seen the sharpest drop in uninsured rates since the enactment of the Affordable Care Act (ACA) in 2010, yet millions remain uninsured. Nine out of 10 marketplace-eligible young adults without health insurance have incomes that would make them eligible for tax credits, thus they should find marketplace coverage affordable. As young adults tend to be healthy and use little medical care, enrolling them in the marketplaces is an essential step toward stabilizing the marketplace risk pools. Thus, CMS and other federal agencies and private partners are undertaking a major outreach effort to enroll young adults in marketplace coverage for 2017. This effort has several components. First, the outreach effort will use online platforms that cater to young adults. Specifically, it intends to use Twitch, a gamer social video platform and community. According to the press release, this effort will feature: pre-roll before videos, a homepage takeover, and ongoing efforts with streamers on Twitch to amplify our message throughout Open Enrollment. For those of you who, like me, cannot fully grasp the intricacies of this statement, it’s worth noting that 10 million daily active users, many of them 18-36 year olds, currently spend 106 minutes per-day, per-person on Twitch. CMS intends to improve its functionality on mobile devices, which one-in-five millennials use exclusively for internet access. It will offer an end-to-end mobile shopping experience, including the ability to comparison shop on a phone or tablet with intuitive navigation and a streamlined interface to compare plans. CMS is also launching a coordinated social media outreach campaign to young adults under the umbrella #HealthyAdulting. CMS is partnering with nearly two dozen youth, ethnic, medical, disability, women’s, and religious groups to conduct outreach campaigns using digital platforms used by young adults, including Facebook, Twitter, and Tumblr to encourage young people to enroll in marketplace coverage. Partnering organizations will host Twitter, Facebook, and Tumblr events potentially reaching hundreds of thousands of their young adult followers. Finally, CMS is targeting individuals whose coverage will soon end and those who were not covered last year. They are collaborating with the Department of Defense to reach out to service members who are transitioning out of military health coverage. Likewise, they are also working with state Medicaid and CHIP programs to contact individuals losing Medicaid or CHIP coverage (about half of whom are aged 18-34) to encourage them to enroll in marketplace coverage. As announced earlier, the Internal Revenue Service is also contacting individuals who paid the shared responsibility fee or claimed an exemption for 2015 to encourage them to enroll in marketplace coverage. About 45 percent of taxpayers who paid the fee or claimed an exemption in 2015 were under age 35. Hawai’i Completes 1332 Waiver On September 26, CMS notified Hawai’i that its application for a 1332 waiver was complete. Section 1332 of the ACA allows HHS (and the IRS) to waive or modify certain ACA requirements to encourage state innovation as long as proposed state programs meet the coverage and affordability goals of the ACA. Hawai’i asks that it be excused from operating a Small Business Health Options (SHOP) marketplace program and that small group health plans in the state not be required to offer a silver level plan. Hawai’i’s Prepaid Health Care Act has long required small businesses to offer even more generous health plans, thus these provisions are unnecessary. HHS now has 180 days to approve or disapprove Hawai’i’s prop[...]

People Post: Staff And Board Changes In Health Philanthropy

Tue, 27 Sep 2016 15:40:22 +0000

Zia Agha has been promoted to chief medical officer at West Health, which includes the Gary and Mary West Foundation, West Health Institute, and the Gary and Mary West Health Policy Center. Agha will continue in his position of West Health’s executive vice president of clinical research and informatics and will have additional responsibilities for telehealth, according to a September 8 press release. Agha is an internal medicine physician and a clinical professor at the University of California, San Diego. Derek Coy has been named the New York State Health Foundation’s (NYSHealth’s) new veterans’ health officer. He is a veteran of the US Marine Corps who served in Iraq, and he attained the rank of sergeant. Previously, Coy worked for the organization called Iraq and Afghanistan Veterans of America. Coy said in the release, “I’m eager to jumpstart and lead NYSHealth’s efforts to ensure that veterans get the care and support they need and deserve.” A RAND Corporation assessment, funded by NYSHealth, found that nearly half of veterans returning to New York State prefer to receive care and services outside of the Veterans Administration (VA) system, the release noted. After more than a decade as director of public information at the United Hospital Fund, Bob de Luna has resigned from the fund. He is the new press secretary/senior director of media relations at NYC (New York City) Health and Hospitals, which is the largest public health care system in the United States, according to an August 5 press release. After more than twenty-five years as chairman of the Heinz Endowments, Teresa Heinz will pass the chairman’s baton to another family member. She will continue, though, as a member of the endowments’ board and of its Executive Committee. In October, she will be succeeded as chairman by her son André Heinz. Each of her other two sons will later serve as chairman. Teresa Heinz’s late husband was former US Senator H. John Heinz III. Read more here. Teresa Heinz is now married to US Secretary of State John Kerry. Marian Mulkey has left the California Health Care Foundation, where she had been chief learning officer. She is exploring new work challenges in the arena(s) of health, policy, or both, she told Health Affairs. Read the June 17, 2014, Health Affairs Blog post, “Online ACA Marketplaces: The Value Of Consumer Experience Assessments,” by Mulkey and Claudia Page. It was published in the blog’s GrantWatch section. Lendri Purcell has been named vice president of environmental health and youth development programming at the Barbara and Donald Jonas Family Fund. She is a granddaughter of the fund’s cofounders Barbara and Donald Jonas. According to an August 1 press release, “Purcell will expand current partnerships with an emphasis on growing awareness about how commonly used toxic substances are impacting children’s health.” She has been spearheading this new area for both the fund and the Jonas Center for Nursing and Veterans Healthcare. “Specifically, she will examine ways to partner with academic institutions to more effectively integrate environmental health into the larger healthcare system, particularly for children.” Purcell also continues to be involved with and lead the Jonas Youth Initiative, according to a spokesperson for the Jonas Family Fund. S. Karthick Ramakrishnan, a professor and associate dean of the School of Public Policy at the University of California, Riverside, has been appointed to the board of the California Endowment. He is also a global fellow at the Woodrow Wilson International Center for Scholars, in Washington, D.C. Ramakrishan holds a Ph.D. in politics from Princeton University. Jeff Richardson, former vice president of the AbbVie Foundation, has joined APCO Worldwide’s Health Advisory Board, according to an August 1 press release. He “will advise APCO’s clients on global health, HIV/[...]

The Proposed Federal ‘Right-To-Try’ Law Is Not The Answer For Critically Ill Patients

Tue, 27 Sep 2016 15:00:22 +0000

Currently, patients have two main options to access experimental therapies that may treat their conditions but that have not yet been approved by the Food and Drug Administration (FDA): enrolling in a clinical trial or applying to FDA’s expanded access (also known as compassionate use) program. But because FDA’s expanded access program has been viewed as cumbersome and overly restrictive, 31 states have passed “Right-To-Try” laws in the past two years. Based on model legislation created by the Goldwater Institute, a public policy think tank, right-to-try laws are intended to authorize use of experimental, not-yet-approved treatments for patients with advanced illness; prohibit sanctions of health care providers for providing experimental treatment; and clarify health insurers’ roles. In May, the Trickett Wendler Right to Try Act of 2016, a companion to a House bill introduced in 2015, was introduced in the Senate. But right-to-try laws, while currently popular, are controversial. In California, Governor Jerry Brown recently vetoed a right-to-try law, saying the FDA’s revised expanded access program should be given a chance to work. A 2015 article in The New England Journal of Medicine provides a legal and ethical critique of expanded access and use of investigational drugs, noting that right-to-try laws “will have limited effect” because “they do not compel manufacturers and insurers to supply and pay for experimental therapies.” I am a survivor of advanced metastatic melanoma. As I wrote in my Narrative Matters essay in the July issue of Health Affairs, I was excluded from extremely promising clinical trials three different times and the delays in access almost killed me. “Faced with imminent death, informed patients have the right to risk their lives by taking a promising but unproven drug, just as they have the right to decide when to terminate further treatment,” I concluded in my essay. “Withholding drugs in such situations is unethical and paternalistic, even if it may violate the physician’s Hippocratic oath to ‘first, do no harm.’” A day after my article appeared, a representative of The Goldwater Institute contacted me, asking if I would be interested in possibly testifying on behalf of right-to-try legislation. After reading the model legislation and the proposed Senate bill, and doing some digging, I decided that while the right-to-try movement has a goal I could approve of in theory, I think it will be counter-productive in the end. Concerns With Right-To-Try Laws To date, I know of no publicized cases where a right-to-try law has enabled access to drugs by the critically ill. There are a number of problems with right-to-try legislation that may explain why. Will pharma participate? There is nothing in any right-to-try legislation, including the proposed federal bill, that compels drug companies to provide their experimental drugs to critically ill patients. This is likely to be the major sticking point. There are many reasons a drug company would not want to provide experimental and unproven drugs, including burdensome costs (especially if the company is small) and potential poor health outcomes when the drug is used in a less controlled situation with sicker patients (leading to liability or bad publicity). Who pays? There is nothing in the proposed Senate bill concerning payment, and the model legislation merely notes that a health plan may, but is not required to, cover experimental therapies. In some states, insurance companies are likely to cover costs, and in others it remains unclear who is responsible. Under compassionate use, the FDA prohibits drug companies from charging more than their manufacturing costs for a yet-unapproved drug, which should prevent profiteering at the patient’s expense. Still, my fear is that the right-to-try laws will likely favor the wealthy and best[...]

New Guidance on Premium Rate Increases

Mon, 26 Sep 2016 18:44:42 +0000

Section 2794 of the Affordable Care Act requires the Department of Health and Human Services (HHS), in conjunction with the states, to review “unreasonable increases in premiums for health insurance coverage.” Section 2794 further provides that: The process established under paragraph (1) shall require health insurance issuers to submit to the Secretary and the relevant State a justification for an unreasonable premium increase prior to the implementation of the increase. Such issuers shall prominently post such information on their Internet websites…. Under implementing regulations, premium increases are reviewed for unreasonableness by states determined by the Centers for Medicare and Medicaid Services (CMS) to have “effective rate review programs,” or by CMS itself in states that do not have such programs. Currently CMS reviews the reasonableness of rates in only five states as the rest have been determined to have effective rate review. Implementing regulations provide that rate increases exceeding 10 percent (or an HHS approved state-specific threshold) are subject to review by CMS or by states. Rate increases have been reviewed at the product level until this year, but for policy years beginning as of January 1, 2017, rate increases are being reviewed by at the plan level. Premium increases in excess of 10 percent are not per se unreasonable, but may be considered to be unreasonable if they are determined by CMS or a state after further review to be excessive, unjustified, or unfairly discriminatory. If rates are determined to be unreasonable by a state, the state may have the authority to disapprove them. If the state lacks this authority, however, or if CMS determines a premium increase to be unreasonable in states where it does review, the insurer may nonetheless implement the increase. The insurer must, however, submit to CMS or the state a “final justification” of the unreasonable rate increase. It must prominently post on its website publicly available documentation it submitted in support of its rate filing, the final state or CMS determination of unreasonableness with the supporting explanation provided by CMS or the state, and the insurer’s final justification for implementing the rate increase. This information must continue to be available for three years. On September 26, 2016, CMS released a guidance further clarifying the “prominent display” requirement and the required content of the final justification. A justification is “prominently posted” if it can be viewed on the insurer’s public website through a clearly identifiable link or tab from the home page without requiring an individual to create or access an account or enter a policy number. An individual must be able to easily determine which rate filing applies to a specific product in a particular market and year. The final justification cannot simply restate the rationale in the initial rate filing. It must include a thorough explanation and analysis of the insurer’s decision to implement the unreasonable rate increase and must respond to the concerns raised by CMS or the reviewing state. It is not clear why CMS is offering this further guidance a half decade into the rate review program, but given the reportedly high level of premium increases for 2017, further clarification was presumably judged necessary. [...]

Building A 21st Century Health Department To Lead Baltimore’s Culture Of Health

Mon, 26 Sep 2016 18:00:38 +0000

Editor’s note: This is the first of a periodic series of Health Affairs Blog posts discussing the Culture of Health. In 2014 the Robert Wood Johnson Foundation announced its Culture of Health initiative, which promotes health, well-being, and equity. The initiative identifies roles for individuals, communities, commercial entities, and public policy that extend beyond the reach of medical care into sectors not traditionally associated with health. Health Affairs is planning a theme issue in November 2016 that will explore various aspects of the Culture of Health. In the aftermath of the unrest sparked by Freddie Gray’s death in April 2015, Baltimore City was thrust into the national spotlight. Glaringly absent from the mainstream media discussion, however, was dialogue around systemic health disparities — an issue deeply intertwined with race, poverty, and social justice. Baltimore faces a mortality rate 30 percent higher than the rest of Maryland and ranks last in the state on nearly all key health outcomes. This reality is compounded by a series of complex social, economic, and political determinants of health: more than one in three of Baltimore’s children live below the federal poverty line, and more than 30 percent of Baltimore households earn less than $25,000/year. Baltimore houses some of the best health care institutions in the country, yet significant disparities exist. We know that this is largely because health care alone cannot drive health. While 97 percent of health care costs are spent on medical care delivered in hospitals, only 10 percent of what determines life-expectancy takes place within the four walls of a health care facility. Where we live, work, and play each day drives our health and well-being. As the oldest, continuously operating health department in the country, the Baltimore City Health Department (BCHD)’s mission and mandate is to promote a culture of health throughout the city via a comprehensive spectrum of service delivery, advocacy, education, and strategic partnerships that bridge the gap between the clinic and the community. Our Culture of Health approach contains four key prongs: Building Unconventional, Cross-Sector Coalitions To Leverage Best-Practice Models B’More for Healthy Babies is a city-wide public-private partnership developed to decrease the city’s infant mortality rate. Drawing upon the unique expertise of local businesses, foundations, and faith/community-based organizations, the program has reduced the infant mortality rate in the city by 28 percent, decreased the teen birth rate by 36 percent, and closed the disparity between black and white infant deaths by almost 40 percent. Engaging And Empowering Communities To Tackle Health BCHD deploys peer-based models that draw on community expertise while increasing economic opportunity. For example, our Safe Streets program takes a public health approach to violence prevention. Safe Streets uses ex-felons who know their surrounding communities intimately to serve as “violence interrupters”; their lived experience allows them to build relationships with local youth and intervene directly at the point of conflict. In 2014, Safe Streets facilitated 15,000 client interactions and mediated 800 conflicts, more than 80 percent of which were deemed likely or very likely to have resulted in gun violence. Connecting Health Care And Public Health As a neutral convener, BCHD brings together hundreds of local stakeholders to create city-wide alignment around topics including opioid prescription best practices, high-utilizer case management, and trauma interventions. Our Local Health Improvement Council, which consists of hospitals, federally qualified health centers, community-based organizations, and faith leaders enables us to break out of our silos and move forward on s[...]