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NEWS FLASH

Texas Applies For Health Reform Waiver That Benefits Insurers | A key consumer benefit of President Obama’s health care reform law is the Medical Loss Ratio — a requirement that insurers spend 80 to 85 percent of premium dollars on health care, rather than administrative spending, and reimburse their customers if they fail to meet that standard. Now Texas, under Gov. Rick Perry (R), is seeking an exemption from that requirement. According to the Centers for Medicaid and Medicare, Texas has requested an adjustment of the MLR standard to 71 percent, 74 percent, and 77 percent for 2011, 2012, and 2013, respectively. States can apply for a waiver if they can demonstrate that insurers really will leave the state if they are forced to comply with the rate. If Perry’s request is granted, it may be a financial coup for insurers’ profits, but a blow for Texas consumers who already have to pay insurance premiums that are higher than the national average. Texas has the highest uninsurance rate in the nation.

NEWS FLASH

Florida’s Rick Scott Asks Legislature To Accept Affordable Care Act Funds | Health care reform foe Gov. Rick Scott (R-FL) — who has turned down almost every grant available through the Affordable Care Act — has asked the Joint Legislative Budget Commission to reconsider its rejection of a home visiting grant from the ACA, which, among other things, could be used to prevent child abuse. Scott initially approved the $3.4 million Maternal, Infant and Early Childhood Home Visiting grant, but the legislature “rejected it because the state is in litigation with the federal government over health care reform.” Interestingly, it gave back the money despite reducing funding for Healthy Families Florida — a program that provides home visitation services to both expecting parents and parents with newborn children in order to prevent future instances of abuse — by a staggering 43 percent. As a result, Healthy Families was forced to scale back, dropping services for 5,800 children in 3,500 high-risk families.

Massachusetts Lawmaker Introduces Bill To Minimize Disparities In Health Care Prices

Earlier this year, Massachusetts released health data which found that insurance companies were paying some hospitals significantly more than others for providing similar care, even though the higher paid hospitals were not producing better outcomes. The cause of the cost disparities was difficult to determine, but a report by state Attorney General Martha Coakely argued that the difference may be partly attributed to provider market clout, which allows dominant (so-called “brand name”) providers who hold monopolies to charge more without necessarily offering better care.

Yesterday, House Minority Leader Ronald Mariano introduced a measure that he claims would address the problem and save the state up to $267 million. Under the bill “Massachusetts health insurers would be required to pay lower rates to some of the state’s most expensive health care providers, while boosting rates for some of the lowest-paid providers”:

Mariano, D-Quincy, said the bill would immediately address the price disparities. It would potentially impact the 20 percent of hospitals and physicians at the high end of the rate spectrum, along with the 20 percent at the lowest.

High-cost providers would not be allowed to renew contracts or enter into new ones with insurers unless their rates are lowered to below the 80th percentile of all health plan rates. Conversely, insurers would be prohibited from entering into or renewing contracts with the lowest-cost providers unless those rates are increased beyond the 20th percentile of all plans.

In a statement, Mariano added that the measure would compliment Gov. Deval Patrick’s (D) ongoing effort to control health spending by shifting the state from a fee-for-service payment system to one that rewards outcomes and better care coordination. “Changing the payment system will take several years but employers and consumers can’t wait that long,” he said. “If we expect the health care system to function properly and more efficiently, closing the gap between lower-paid providers and higher-cost providers needs to be a priority and we must start now.”

Indeed, eliminating price disparities that don’t result in better health outcomes could be a serious money saver — both for the state and individuals. But she state could even go a step further and create an authority that would negotiate set prices with all providers, thus undercutting hospital monopolies and ensuring that health dollars are spent delivering better health care rather than paying for some kind of business “brand.”

Yglesias

Health Care: The Lost Opportunity

It’s difficult for me to say how much the blame for this should be allocated to President Obama and how much the blame belongs to people in Congress, but Brian Beutler makes the excellent point that the Affordable Care Act was arguably a huge missed opportunity for fiscal stimulus:

In early 2009, Obama turned from stimulus to health care, and by insisting the reforms reduce deficits he locked his most effective recovery tools in a policy shed and handed the key to his political enemies. They were famously unpersuaded by the gesture, and instead (falsely) portrayed the bill as a budget buster — an early salvo in a campaign to blame Obama and Democrats for soaring deficits, which of course were almost entirely attributable to the Bush-era recession.

By late October 2009, according to Gallup, 14 percent of the public thought the President’s top priority should be the deficit, double what it had been at the end of Bush’s term. The same poll found 41 percent of the country thought the economy should be his top priority — down from 64 percent in 2008, before the stimulus had helped end the country’s employment free fall. The wars in Iraq and Afghanistan and health care also bested the deficit. Other polls showed similar figures, though many asked questions in different ways, and still others asked respondents to name their top economic priorities. Jobs always trounced the deficit, but public concern was starting to bud. Prior to about 2009, the deficit wasn’t even listed as an option on similar polls.

A few points on this that are important. Obama and the White House not only insisted that the health care bill be (mildly) deficit-reducing in the long-run (a good idea) and “bend the curve” on long-term health care cost increases (a good idea) but also that it be deficit-neutral within an arbitrary CBO 10-year scoring window. This last thing was a purely political conceit, designed to bolster the political fortunes of the bill and its proponents. Nothing wrong with that—you can’t take the politics out of politics. But a smarter Democratic Party would have recognized that the political impact of 10-year CBO scoring windows is tiny compared to the political impact of short-term macroeconomic fluctuations and decided to set 10-year CBO scoring window concerns aside in favor of using the bill as a vehicle for fiscal stimulus. The simplest way to do that would probably have been to put a large temporary Medicaid bailout in the bill, which would have sharply reduced the need for cutbacks in other areas. Or to get more clever, the appropriations to help states set-up insurance exchanges could have been way higher than states would actually need, combining macroeconomically useful state fiscal assistance with a hefty bribe to governors to actually do implementation. You can probably think of other ideas.

Now failure to do this isn’t, I think, “Obama’s fault” in the sense that he could have just snapped his fingers and made it happen. But it was a collective blunder on the part of the administration, the congressional leadership, and the members themselves and there’s no sign I’m aware of that anyone in the White House ever tried to move the needle on this.

NEWS FLASH

Andrea Mitchell Diagnosed With Breast Cancer | Moments ago, longtime NBC News reporter Andrea Mitchell announced that she was diagnosed with breast cancer over the summer. Mitchell’s doctors discovered the cancer during her annual checkup, catching the disease in its earliest stage. Mitchell reported that she faces a “terrific prognosis” and urged women across the country to screen for the condition. “This disease can be completely curable if you find it in the right time,” she said. Watch it:

Rep. Joe Walsh Calls For Shrinking Medicare Down To An Insurer Of Last Resort

Rep. Joe Walsh (R-IL) — a strong proponent of Paul Ryan’s Medicare privatization scheme — told students at Mundelein High School on Tuesday that he would support transforming Medicare into a “safety net” program of last resort for seniors with no other coverage options:

But he spent the most time talking about the need to cut spending on federal health programs, including Medicare. Medicare should be used only as a “safety net” for those who cannot get health care anywhere else, he said. “We have got to begin to pay for and be more responsible for our own health care costs,” he said.

Those who are affluent should pay more for medical care, he said. He cited as an example his parents, who live in a “fancy retirement home in Barrington.” Teacher Thomas Kuhn asked Walsh what type of reaction he was hearing from senior citizens regarding cuts.

“Maybe I’m wrong and I won’t be in Congress two years from now … but most people say: ‘I’m in. I know we have got a big problem,’” Walsh said. But he noted people 55 and older would not be impacted if the reforms he supports become law.

Walsh would be happy to know that more affluent seniors are already paying more for Medicare Part B and that the government-run program has delivered care far more efficiently than private insurers. Medicare expenses per beneficiary have certainly increased since it was enacted in 1965, but they’ve risen significantly less than private insurance premiums — unraveling the program and forcing beneficiaries into other kinds of insurance plans would actually increase health care costs, not lower them.

In fact, as the largest U.S. purchaser and regulator of health care, Medicare exerts major influence on the rest of the health care system and “its reimbursement and coverage policies have been widely adopted by private insurers and other public programs.” For instance, since Medicare has emphasized payment reform, “private plans generally use the public Medicare plan’s criteria for covering treatments as their standard of medical necessity, and they have adopted many of Medicare’s innovations in payment methods.”

NEWS FLASH

Obama Administration Finalizes LGBT-Friendly Hospital Policy | The Department of Health & Human Services has finalized new policy on hospital visitation rights for same-sex couples. According to a memo released today, hospitals that receive Medicare and Medicaid funds must allow patients to designate their own visitors as well as who can make emergency medical decisions, including same-sex partners. The Health Resources & Services Administration will also announce a $248,000 grant to help train community health centers on how to better serve LGBT populations.

Yglesias

Achieving Mitt Romney’s Tax Fantasy Would Require Medicare Repeal

The Mitt Romney jobs plan is a very savvy document. It’s not all ranting and raving about how everything is unconstitutional, and indeed it doesn’t even say he wants to repeal Medicare. And yet lurking between the lines is an agenda on social welfare policy that’s basically every bit as extreme as anyone else’s. The tell here is when he argues against a balanced approach to long-term deficit reduction by arguing that “the reality is that before President Obama exploded the size of the federal government, our existing tax rates were more or less adequate to pay for the government we needed.”

For one thing, though it’s true that in 2006 the budget deficit was small as a share of GDP, at that time we were at the peak of a macroeconomic cycle and the private sector was piling on debt. An adequate tax system for the time would have been one that generated a substantial budget surplus in order to cushion us against the possibility of future recession.

The bigger issue here, however, is that we’ll need more tax revenue in 2016 than we needed in 2006 and we’ll need even more in 2026. The reasons for that have nothing to do with President Obama and everything to do with Medicare and Medicaid. These are programs that pay for health care services for the elderly, the disabled, and the poor. And the price of health care services is rising. Consequently, you either need higher taxes than were adequate in 2006 or else you need to gut the programs. The best thing to do—needless to say—is to enact systemic changes that slow the rate at which health care prices increase. The Affordable Care Act takes a number of steps in that direction and there’s more that can and should be done. However, it would be absurdly utoptian to hold that any systematic change is going to hold health care cost increases to zero even in the face of population aging. Maintaining America’s commitment to health insurance for senior citizens is going to require higher taxes. When politicians try to say that we can get by with Bush-era levels of taxation indefinitely, they mean we can get by with Bush-era levels of taxation if we scrap Medicare.

Romney’s whole plan is framed as a paen to economic growth and one has to concede that in those narrow terms this makes perfect sense. Lots of public spending—on infrastructure, on education, on health care, etc.—is important to economic growth. Providing health care services to 72 year-olds is not. My grandparents are lovely people, but they’re not, at this point in their lives productive workers. Radically reducing the living standards of the elderly in order to reduce the corporate income tax is plausibly a “pro-growth” measure. My view is that this reflects the limits of the Romney perspective rather than its merits, and you can tell that the authors of the document are not eager to draw out this particular implication, but that appears to be the basic structure of the thinking. Why tax productive firms in order to finance health care services for non-productive retirees?

NEWS FLASH

77 Percent Of Doctors Say AMA Does Not Represent Their Views | Seventy-seven percent of physicians “say the American Medical Association does not represent their views, according to a new volunteer-based online survey by the physician staffing firm Jackson & Coker. Just 11 percent said AMA’s stance and actions reflects their beliefs.” The doctors also rated AMA as ineffective in lobbying for their priorities, including tort reform (72 percent called AMA ineffective), physician practice autonomy (69 percent), physician reimbursement (68 percent), protections from insurance company abuses (75 percent), and “intrusive government regulations” (78 percent).

The AMA took a big hit after it failed to secure a deal to stave off reimbursement cuts (changing the so-called SGR formula) as part of the Affordable Care Act and that did nothing to stop the slow bleed of doctors turning their backs on the organization. While it theoretically represents all physicians, the AMA’s paying membership comprises somewhere between 15 to 18 percent of doctors. Consequently, member dues accounted for a relatively small percentage of AMA revenue. The rest of its funds come from things like billing codes, CMS payment negotiations, and other non-membership-related operations.

Rick Perry Throws Support Behind Nation’s Most Radical Anti-Abortion Bill

An anti-abortion group has announced that Rick Perry supports Ohio’s controversial “heartbeat bill,” one of the most radical and restrictive abortion measures in the country. The bill — designed to establish a direct challenge to the 22 to 24 week viability standards in Roe v. Wade — outlaws abortions if a fetal heartbeat can be detected, which can be as early as “six to seven weeks into pregnancy” and offers no exception for cases of rape, incest, or mental health of the mother:

“We’re grateful to Governor Perry for his strong support of the Heartbeat Bill. I don’t think there’s a bill in America with more support,” declares Faith2Action President Janet (Folger) Porter. She adds, “Come to the Statehouse Atrium on September 20 and get a glimpse of the statewide support for the Heartbeat Bill!”

At a meeting in Texas, Governor Perry announced his support before a group of 250 pro-life and pro-family leaders. His response of support to a question about the Heartbeat Bill received an extended standing ovation.

The radical bill is being pushed by the equally radical Faith2Nation’s Jane Porter, a believer in “dominion” theology — “the idea that Christians are called to take complete control over every aspect of human life in order to bring about the return of Christ” — and the former co-chair of Mike Huckabee’s Faith and Family Values Coalition when he first ran for president. The Ohio House passed the heartbeat measure in June, during a bizarre session when Republican lawmakers compared opponents of the law to slave owners and argued that abortions make people more likely to smoke pot. The state Senate is expected to take-up the measure this month.

Last week, a federal judge blocked a Texas law signed by Perry that requires women seeking abortions to undergo sonograms and listen to the fetal heartbeat at least 24 hours before the procedure.

Morning CheckUp: September 7, 2011

Health advocates concerned about HHS rules: Consumer advocates “point to a long-sought provision in the law that entitles patients to an external review if an insurer won’t pay for a medical service, but charge that recent regulations limit its effectiveness.” [Kaiser Health News]

Why we need comparative effectiveness research: “Medicare could have saved more than $1 billion and Medicare patients $275 million over two years if doctors treated a serious eye disease with Genentech’s Avastin instead of the company’s similar but more expensive drug Lucentis, according to a new government audit.” [WSJ]

Conservatives step-up battle against birth control: “It used to be that opposition to publicly funded birth control was linked to abortion. Either the birth control in question allegedly caused abortion, or the organization providing the birth control also performed abortions. But that’s changing.” [Julie Rovner]

Kansas moving forward with abortion regs: “Kansas health officials moved ahead Tuesday with work designed to preserve new regulations for abortion providers despite a legal challenge in federal court that so far has blocked their enforcement.” [AP]

Pushing for better affordability standards: Health proponents are urging the administration to tweak last months’ regulations, which would preclude families that spend more than 9.5 percent on coverage from accessing federal subsidies. “The Kaiser Family Foundation’s Larry Levitt and Gary Claxton, for example, suggest that regulators look at a family’s size and income and then determine whether employer-sponsored coverage is affordable. Another “hybrid” approach would be to calculate affordability for the worker and his or her family separately.” [Julian Pecquet]

Energy and Commerce releases agenda: “The House Energy and Commerce Committee’s Health panel will spend the fall focused on healthcare reform regulations and preparing for a major Food and Drug Administration bill.” [Sam Baker]

Mississippi, Colorado plan for soft launch of exchange: “Some states in the process of developing insurance exchanges are planning on launching them prior to the Jan. 1, 2014, operational deadline set by the health reform law…The official leading the creation of Colorado’s exchange says the state is aiming for a ‘soft launch’ in July 2013, and Mississippi insurance department officials also say they plan to have an exchange operational sometime next year.” [Rachana Dixit]

States are changing the way health care is governed: Kansas, Maryland, Ohio, South Dakota, Vermont and Washington are revamping the way they administer health care policy in an effort to slow down costs. [Stateline]

Smoking rates down, but still above federal goals: “The number of adult Americans who smoke is on the decline again after several years of little change, and those who smoke are puffing fewer cigarettes a day.” [WSJ]

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