As Yogi Berra would say, "It's déjà vu all over again." 2010 began with Washington obsessed with health care reform and the election of Scott Brown on January 20 - a year to the day after President Obama's inauguration. Now, despite passage of the Affordable Care Act ten months ago, 2011 begins with the House of Representatives repealing the "job-killing" health care bill. Looks like we are in for another year of the continued debate.
(January 28, 2011) Some states are considering significant cuts in Medicaid spending once their enhanced federal matching grants expire in June, but CMS Administrator Don Berwick says CMS is trying to head off this problem by developing strategies to assist states. Other signs indicate there may be a developing showdown between the federal government and states over how to deal with Medicaid costs. Arizona, for example, recently asked HHS for a waiver of the federal requirement not to cut Medicaid coverage, and other states may follow. If HHS refuses to give the waivers and states cut Medicaid anyway, the Administration will have to decide whether to cut federal matching payments to those states as punishment.
(January 29) Relatedly, CMS Administrator Donald Berwick was nominated by President Obama to remain at the helm of CMS, and so will go before the Senate Finance Committee for a confirmation hearing, which he did not have to undergo this summer due to the nature of his recess appointment.
On Wednesday, January 26, CMS’s Chief Actuary, Richard Foster, told the House Budget Committee that recent health care reforms would not hold down costs, and they would not let everyone keep their current coverage. Specifically, Foster’s office – which is responsible for Medicare’s independent long-range cost estimates – projects that 7 million Medicare recipients in private Medicare Advantage plans will eventually have to find other coverage, cutting enrollment in the plans by about half, and that if Medicare cuts to hospitals, nursing homes and home health agencies turn out to be politically unsustainable, close to 15 percent of providers could be driven into the red.
(January 27) HHS reports that some 500 groups recently received waivers of a health care reform provision that set annual coverage requirements, while approximately 50 requests were denied (in total, 729 waivers now have been approved). Those that were denied, “Did not demonstrate that compliance with the minimum annual limits requirements would significantly increase premiums or decrease access to benefits,” said an HHS spokeswoman. In spite of the large uptick in total waiver approvals, the total number of individuals actually covered by the waivers only rose from 1.5 million to 2.1 million.
On Monday, January 31, a U.S. District Court Judge in Florida ruled the recent health care reform law unconstitutional on several grounds, but of note, he declined to block the law while the Obama Administration appeals his decision. The tally at the trial court level is now two-to-two: two courts have found the law unconstitutional, and two have upheld it. The Virginia case is now expected to be heard by the 4th Circuit’s Court of Appeals in May, and the case in Michigan – which upheld the law’s constitutionality – is expected to go forward even sooner.
In his State of the Union Address on Tuesday, January 25, President Obama signaled his willingness to revise the Affordable Care Act but said he was not willing to let insurance companies deny coverage due to pre-existing conditions. In his speech, the president suggested revision of the Affordable Care Act’s bookkeeping regulation so as not to place unnecessary burden on small businesses. The White House’s new Chief of Staff, William Daley, echoed Obama’s sentiments later in the week.
On Friday, January 28, HHS released a report arguing 1) that individuals and families purchasing coverage through health exchanges in 2014 will save between 14 and 20 percent; 2) the new Medical Loss Ratio requirements will “likely lead to rebates” in 2012 for an estimated 5 million insurance customers; and 3) early retirees from more than 5,000 businesses and unions are having their premiums reduced through the Early Retiree Reinsurance Program.
In the states: 1) The Maryland General Assembly introduced three bills that, if passed, would implement the Patient Protection and Affordable Care Act by prohibiting health insurers from denying coverage based on pre-existing conditions or imposing lifetime benefit limits, mandating coverage for some preventative services, and allowing young adults to remain on their parents’ health insurance policies until they are 26. 2) In Minnesota, a bill that would repeal a Medicaid health care expansion ordered by Democratic Governor Mark Dayton has cleared a Senate panel. The bill says the U.S. Constitution doesn't give the federal government the power to regulate health care and directs the Minnesota attorney general to defend the state's rights. 3) A bill that would declare the federal health care overhaul unconstitutional has failed unanimously in a South Dakota House committee. Republicans on the House State Affairs Committee said they would prefer other ways to oppose it; including bringing a lawsuit joined by state Attorney General Marty Jackley.
The Office of the National Coordinator for Health Information Technology recently passed the final regulation for establishing the permanent certification program for health care management technology, which will replace the system established in June 2010. Under this program, factors such as increased comprehensiveness, reliability, efficiency and transparency will be taken into account in order to certify electronic health record technology.
Treasury Secretary Timothy Geithner sent a letter to trade organizations to ensure that small businesses are aware of a tax credit in the health care overhaul. The letter detailed how the Small Business Health Care Tax Credit can aid small businesses that want to provide coverage to their employees. The credit, which is generally available to businesses with less than 25 full-time employees, covered 35 percent of a business’s health care premiums in 2010 and will take care of 50 percent in 2014.
On Thursday, January 27, President Obama appointed five physicians to the Presidential Advisory Group on Prevention, Health Promotion, and Integrative and Public Health. The Patient Protection and Affordable Care Act requires the establishment of this advisory group, which is made up of 13 presidentially appointed members and is part of HHS. The group will provide feedback and policy recommendations on prevention and management of chronic diseases, integrative health and the promotion of healthy lifestyles.
On Tuesday, February 1, the Brookings Institution will hold a discussion entitled "Health Care Payment and Delivery Issues." On Wednesday, February 2, the Senate Judiciary Committee will hold a full committee hearing titled "Constitutionality of Health Care Law." Next Monday and Tuesday (February 7 and 8), Academy Health will hold a national health policy conference where the White House's Director of the Office of Health Reform and CMS Administrator Donald Berwick will speak. Registration costs range from $250 to $1,150.