Early Friday Congress passed and the president signed a wide-ranging, two-year budget deal that also extends government funding through March 23, staving off an extended shutdown.
The bill has a variety of health policy implications, including a delay to Disproportionate Share Hospital payment cuts, a repeal of the board some labeled a “death panel” during debate over the Affordable Care Act and funding to fight the opioid crisis. Also included are technical changes to the Medicare Access and CHIP Reauthorization Act of 2015 aimed at smoothing the transition to the new Quality Payment Program.
The agreement does not include reinsurance or cost-sharing reduction payment funds, which some lawmakers pursued in an effort to stabilize ACA exchange
The massive legislation raises spending caps on domestic and military spending by about $300 billion and pushes the federal debt limit to March 2019. A variety of Congressional Budget Office estimates predict the deal will add almost $420 billion to deficits over the next decade once interest is accounted for, according to the Committee for a Responsible Federal Budget. Now Congress will move to the appropriations process.
Key healthcare provisions in the budget deal include:
Repeals the ACA’s Independent Payment Advisory Board
The IPAB, created by the ACA, was an independent board that could make reductions in Medicare payments to providers if overall spending grew faster than a set rate. The panel has never convened and has not been used to reduce Medicare spending.
The board was never popular among Republicans and even among certain Democrats. Senate Finance Ranking Member Ron Wyden (D-Ore.) acknowledged that the repeal “garnered bipartisan support, showing that many Democrats have joined Republicans in recognizing just how ill-advised the creation of this panel really was.”
Drugmakers also never liked the board, in part because one of its purposes in theory was to limit spending on drugs. The American Medical Association praised the move.
Delays Disproportionate Share Hospital payment cuts
The bill also stalls cuts to Medicaid payments for hospitals that serve a high proportion of low-income patients until 2020.
The American Hospital Association praised the deal, saying that the delay in cuts to DSH payments would help health systems care for children, the poor, the disabled and the elderly.
“This delay will help ensure that hospitals can continue to deliver high-quality care for their patients. We also are encouraged that the bill extends critical rural programs — including the Medicare-dependent Hospital program, the enhanced Low-volume Adjustment program, and the ambulance add-on payment program — that help keep vital care and service in rural America,” said Rick Pollack, president and CEO of AHA, in a statement.
Meaningful use standards
The bill also contains elements of the Health Information Technology for Economic and Clinical Health Act, removing a mandate that meaningful use standards begin to be more stringent over time. The section aims to reduce “future electronic health record-related significant hardship requests,” according to House Energy & Commerce Committee Chairman Greg Walden (R-Ore.). The bill also repeals the Medicare payment cap for therapy services.
“We applaud the provisions in the bill that repeal the Medicare payment caps for outpatient therapy services, give hospitals more flexibility on meaningful use and increase the availability of telehealth services. The bill also supports chronic care management, including policies that advance team-based care, expand innovation and technology, empower individuals and care givers in care delivery and allow patients to receive more care in their homes,” Pollack said.
Closes the Medicare Part D “donut hole” a year early
The Senate budget bill calls for an accelerated close of the so-called Medicare Part D donut hole. The change would also increase the discount that pharmaceutical companies would pay to individuals who fall in a coverage gap from the current 50% cost of the applicable drug to 70% starting in 2019 instead of 2020.
The drug lobbies slammed the change. Pharmaceutical Research and Manufacturers of America CEO Stephen Ubl pointed to an Avalere estimate that the change would save Part D insurance plans $40 billion, adding that Congress should instead use the savings to give seniors an out-of-pocket cap and access to discounts at pharmacies.
“While we support making out of pocket costs for Part D beneficiaries more affordable, the vast majority of savings from this proposal will accrue to the insurance companies that sponsor Part D plans, rather than patients,” said Jim Greenwood, Biotechnology Innovation Organization president and CEO, in a statement.
Provides more opioid funding
Critics have frequently criticized the federal government’s response to the opioid epidemic, saying that more funding is needed to stem the tide of a crisis that has claimed the lives of thousands of Americans.
The budget deal puts forward $6 billion in funding toward opioid and mental health treatment.
The bill also contains $2 billion in additional funding for research projects at the National Institutes of Health, $4 billion for Veterans Affairs to invest in VA hospitals and clinics, $7 billion for Community Health Centers and almost $500 million for the National Health Service Corps.
Extends the Children’s Health Insurance Program
The bill takes advantage of the savings the Congressional Budget Office scored for CHIP by extending the program for four additional years through 2027. Congress had initially extended the program for six years.
The move was praised by a variety of stakeholders, including AMA, AHA and lawmakers.
The blockbuster deal gives Congress six weeks to figure out how to hash out an appropriations deal.
“This bill does not conclude the serious work that remains before Congress. After we pass it, the Appropriations Committees will have six weeks to negotiate detailed appropriations and deliver full funding for the remainder of fiscal year 2018,” McConnell said on the Senate floor Wednesday.
House Appropriations Committee Chairman Rodney Frelinghuysen (R-N.J.) said the deal will enable work on the 12 annual appropriations bills to begin. “I look forward to working with our Senate counterparts to quickly negotiate and complete all 12 full-year Appropriations bills ahead of the March 23 deadline,” Frelinghuysen said in a statement.
HHS on Thursday announced the formation of a Conscience and Religious Freedom Division, to be housed in the Office for Civil Rights.
OCR Director Roger Severino said, “No one should be forced to choose between helping sick people and living by one’s deepest moral or religious convictions, and the new division will help guarantee that victims of unlawful discrimination find justice.”
Reactions were swift with some critics worried the unit will give clinicians cover to refuse to provide abortions, for example, on moral or religious grounds.
The Trump administration posits the move will allow for greater religious freedom but some providers are skeptical and worried the move will block care services to vulnerable populations.
The division will “provide HHS with the focus it needs to more vigorously and effectively enforce existing laws protecting the rights of conscience and religious freedom, the first freedom protected in the Bill of Rights,” the agency announced.
The announcement follows an executive order signed by President Trump last May, dictating the executive branch will “vigorously enforce federal law’s robust protections for religious freedoms.”
The executive order calls on HHS to consider amended regulations to address conscience-based objectives.
The division’s establishment is a reversal of a policy from former President Barack Obama’s administration, which prohibits healthcare workers from refusing to perform “medically necessary” services on transgender individuals. The measure, implementing Section 1557 of the Affordable Care Act, also prohibits refusal to care for those who had or are seeking an abortion.
Section 1557 was challenged in court by the Franciscan Alliance, a religious hospital system. At the end of 2016, the U.S. District Court for the Northern District of Texas issued an opinion in the case, placing an injunction on the enforcement on the regulation implementing Section 1557 regulation’s prohibitions against discrimination on the basis of gender identity and termination of pregnancy on a nationwide basis while the injunction remains in place.
OCR continues to enforce protections against discrimination on the basis of race, color, national origin, age or disability.
The latest move is likely to be challenged in court as well.
American Nurses Association President Pamela Cipriano in response noted nurses have a duty to care but also are justified in deciding to refuse in morally objectionable actions, as long as the decision is consciously-grounded and not stemming from a personal preference or prejudice.
“Nurses who decide not to participate on the grounds of conscientious objection must communicate this decision in a timely and appropriate manner, in advance and in time for alternate arrangements to be made for patient care,” Cipriano wrote. “Nurses should not be discriminated against by employers for exercising a conscience based refusal.”
She added discrimination in healthcare settings “remains a grave and widespread problem for many vulnerable populations and contributes to a wide range of health disparities. All patients deserve universal access to high quality care and we must guard against erosion of any civil rights protections in health care that would lead to denied or delayed care.”
Approximately 8.8 million people signed up for 2018 coverage on HealthCare.gov during open enrollment CMS Administrator Seema Verma announced Thursday on Twitter.
The number falls just a bit short of last year’s 9.2 million signups, overcoming most predictions that 2018 enrollment would be drastically lower due to the enrollment period being cut in half, the program’s 90% cut in advertising budget, and cuts to outreach programs.
Many state-run exchanges are still enrolling individuals, which could result in overall enrollment for 2018 to potentially exceed 2017, according to Larry Levitt, senior vice president at the Kaiser Family Foundation.
Despite the drastic cut in advertising funds from the federal government, insurers’ efforts to run more ads may have made up some of the difference. Research from Wesleyan University showed that private payers TV advertising for the Affordable Care Act (ACA) may have outpaced last year’s ads from both the federal government and private insurers.
President Donald Trump’s decision to end cost-sharing reduction payments to insurers may have resulted in higher federal subsidies for lower-income individuals to pay for premiums. As a result, some insurers were able to provide certain plans to some people for what amounted to free health insurance.
Senate Finance Committee Ranking Ron Wyden (D-Ore.) and Senate HELP Committee Ranking Member Patty Murray (D-Wash.) recently wrote to HHS Acting Secretary Eric Hargan and Verma asking them to extend open enrollment. But it appears that the enrollment numbers were resilient despite what the two characterized as efforts by the administration to destabilize the insurance market.
CMS plugged the reduced spending on advertising, saying it spent only $10 million on marketing and outreach this year, compared to $100 million last year. 8,822,329 individuals signed up for insurance through HealthCare.gov between Nov. 1 and Dec. 15, with 2,394,107 signups coming from new consumers, according to CMS.
Charles Gaba, a highly respected ACA analyst, noted that the number of confirmed overall ACA exchange signups now stands at 11.62 million, with several signups remaining due to states exchanges with later deadlines and hurricane special enrollment periods. Gaba says that it is unlikely that the total signups will reach 12.2 million, last year’s overall total, but predicts that 12 million could be feasible.
House Energy & Commerce Committee Ranking Member Frank Pallone (D-N.J.) praised the number of signups. “This is a remarkable result given the Administration’s efforts to sabotage enrollment by gutting outreach, creating chaos and confusion, cutting off subsidies for low-income families and shortening the enrollment period by six weeks,” he said in a statement.
Senate Majority Leader Mitch McConnell (R-Ky.) told NPR Thursday that he plans to back off efforts to repeal further parts of the ACA in 2018, saying he wants the Senate to act in a more bipartisan manner. He added that unlike House Speaker Paul Ryan (R-Wis.), he does not plan to approach entitlement cuts without support from Democrats.
Early Saturday morning Senate Republicans narrowly passed their sweeping overhaul of the U.S. tax code, which includes a repeal of the Affordable Care Act’s (ACA) individual mandate and could force future automatic cuts of $25 billion a year to Medicare.
The Senate bill would continue to allow people to deduct certain healthcare expenses, and for two years lowers the threshold for those expenses from 10% of gross income to 7.5%.
Lawmakers will now attempt to work out the differences between the Senate bill and a similar tax bill the House passed last month. The House bill preserves the individual mandate and eliminates the individual medical expense deduction. However, the House could simply adopt the Senate bill, potentially muddying the waters for senators who expect further changes to the bill before it is sent to the president.
The Senate tax bill would repeal the ACA requirement that individuals carry health insurance or pay a penalty after Dec. 31, 2018. The provision will cause federal deficits to fall by $318 billion between 2018-2027 and cause 4 million to lose health insurance in 2019 and 13 million by 2027, according to the Congressional Budget Office.
The American Hospital Association (AHA) criticized lawmakers for voting to repeal the mandate, saying the action would cause millions of Americans to lose coverage. “The goal of the ACA was to extend coverage and, as a result, millions have benefited from access to needed care. We must protect that access to care for those who need it and ensure the most vulnerable patients are not left behind,” AHA President Rick Pollack said in a statement.
The bill would potentially trigger automatic cuts to mandatory spending under pay-go rules, leading to billions in cuts to Medicare. But Sen. Susan Collins (R-Maine), a key swing vote, said she was convinced the cuts would not be triggered because Majority Leader Mitch McConnell (R-Ky.) and House Speaker Paul Ryan (R-Wis.) said they would ensure the pay-go law is waived if cuts are pending.
Collins was a late holdout who voted for the bill after McConnell committedto passing legislation that she says will help mitigate increases to health insurance premiums. One, the so-called Alexander-Murray bill, would provide cost-sharing reduction payments under the ACA to insurers for two years. The second would provide $5 billion annually for two years to states to establish high-risk pools or reinsurance programs.
The Senate bill would also implement a 12.5% tax on U.S. companies’ foreign-derived income from intellectual property, potentially aimed at encouraging drug manufacturers from registering patents domestically. It would also scale back a tax credit for pharmaceutical companies conducting orphan drug clinical trials by 50%.
Sen. Bob Corker (R-Tenn.) was the only Republican holdout, citing the bill’s contribution to the federal deficit as his largest concern with the bill. The Joint Committee on Taxation estimates that the bill would increase the deficit by $1,414 billion between 2018-2027 while increasing revenues by $458 billion.
White House Press Secretary Sarah Sanders said Saturday that the administration hopes to reach a final deal on tax reform by the end of the year
The Affordable Care Act (ACA) exchange signups are higher than a year ago after 18 days, but are not on pace to reach last year’s numbers. Nearly 2.3 million Americans signed up for ACA plan coverage through Nov. 18: about 200,000 more compared to the first 26 days of open enrollment last year.
But President Donald Trump’s administration cut the open enrollment period in half from 12 to six weeks this year, which means the weekly average must double to reach last year’s figures. American Enterprise Institute adjunct scholar Chris Conover wrote in Forbes that current enrollment is 158% of last year’s numbers when it actually needs to be at 200% to reach last year’s 12.2 million final numbers.
These figures are only for the 39 states that use the federal healthcare.gov site for the exchanges, including Florida, which leads the way with nearly 500,000 ACA plan signups so far. The CMS’ numbers do not count the enrollments for states with their own exchanges like Massachusetts and California. However, those states are also seeing more open enrollment activity.
The CMS said the third week of open enrollment (Nov. 12-18) saw nearly 800,000 people sign up for an ACA plan, including 220,000 new enrollees. Of the nearly 2.3 million ACA plan enrollees so far for 2018, more than 556,000 of them are new enrollees, which may offset some of the sickest members in the risk pool.
In addition to reducing the open enrollment period this year, the Trump administration cut the ACA’s open enrollment advertising budget by 90% and reduced the budget for the navigator program, which helps people get ACA plans, by 40%.
The lack of advertising and outreach is having an effect. A recent Kaiser Health Tracking Poll found that nearly half of people surveyed said they heard less about open enrollment this year compared to previous years and nearly 40% said they heard about the same this year.
The poll also found:
- Three in 10 people surveyed said they have not heard about the ACA’s open enrollment period this year.
- Three in 10 say they have heard only “a little.”
- Four in 10 said they have heard “some.”
- Only 18% of those surveyed said they have heard “a lot” about open enrollment.
That lack of advertising and outreach could play a key factor during the remaining three weeks of open enrollment. Many people typically do not sign up for an ACA plan until just before the deadline. However, if they have not even heard about this year’s open enrollment, how will they know that the deadline is six weeks earlier this year?
They might not realize that they no longer have until the end of January to sign up, so last-minute signups may not occur at the same rate as previous years. That final push is needed if the final ACA plan numbers can approach last year’s results.
Many of those who are signing up for plans this year are finding cheaper premiums. Trump stopped paying cost-sharing reduction (CSR) payments to insurers. The payments help keep down out-of-pocket costs for lower-income people. Though stopping CSR payments took another shot at the ACA, Trump’s move to stop CSR payments actually backfired. Insurance companies raised their premiums higher because of the CSR uncertainty, but a provision in the ACA kicked in to reduce the higher premiums.
Those who qualify for premium tax credits may find cheaper alternatives for 2018 with the government picking up more of the tab on premiums. However, those who make above 400% of the federal poverty level will pay much higher premiums next year.
Legislation on Capitol Hill dubbed the Alexander-Murray bill would maintain CSR payments for two years. The bill could stabilize the market for the time being, but would not offer any long-term solutions to the individual market and exchanges.
It’s official: The 2018 open enrollment season for Affordable Care Act exchange plans is off to a roaring start.
A little more than 600,000 people signed up for coverage on Healthcare.gov during the first four days of open enrollment, according to a weekly enrollment report from the Centers for Medicare & Medicaid Services. On average, that’s about 150,000 signups per day.
By comparison, last year’s first enrollment report showed there were about 1 million signups in the first 12 days of open enrollment, averaging out to roughly 84,000 per day.
No information is available about the total number of signups for just the first four days of the 2017 enrollment period, as the Obama administration issued only biweekly reports. The Trump administration releases enrollment figures on a weekly basis, but its first report captured only four days because open enrollment started on a Wednesday.
CMS’ report also noted that 137,322 of the plan selections for the first four days of open enrollment have been new customers, while the remaining 464,140 actively renewed their coverage.
Those results come amid predictions that enrollment in ACA plans would be down this year, given the Trump administration’s cuts to advertising and outreach, a shortened signup period, and confusion about the status of the healthcare law given Republicans’ attempts to repeal it.
It’s possible that all the attention given to the ACA in recent months—positive or not—fueled increasing awareness of it, according to Lori Lodes, who was a CMS official under the Obama administration and now runs a campaign called Get America Covered.
“The administration has caused a lot of anxiety for people over the last year when it comes to healthcare, but there’s also been a more in depth conversation about what Obamacare really is about,” she wrote in a post on Medium. “So when most people logged onto Healthcare.gov they found plans that are more affordable than they expected.”
Indeed, while premiums for benchmark silver-tier plans rose an average of 37% in 2018, tax credits rose along them, by an estimated 45%. The result, according to an analysis by the consulting firm Avalere, is that in nearly 98% of counties with exchanges operated by Healthcare.gov, a 50-year-old making about $18,000 a year could purchase a bronze plan for no monthly premium.