Republicans try and squeeze in ACA repeal. Learn more.

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Sept. 22, 2017

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FEATURED STORY
 

One Last Arrow in the GOP Quiver: ACA Repeal-and-Replace Has Last-Gasp Effort

 
 

The Senate is moving toward a vote next week on new legislation recently introduced by Sens. Lindsey Graham (R-SC), Bill Cassidy (R-LA), Dean Heller (R-NV), and Ron Johnson (R-WI) that would repeal and replace parts of the Affordable Care Act (ACA). For defenders of the ACA, this bill contains provisions that make it even less appealing than the Better Care Reconciliation Act (BCRA), legislation that was voted down in July. For opponents of the ACA, conversely, the bill reverses many ACA provisions that Republicans have been decrying for 7+ years.

The sponsors are endeavoring to garner the needed 50 votes for passage before reconciliation instructions expire on September 30, after which time the bill would require 60 votes for passage under regular Senate rules. (Vice President Mike Pence would assuredly cast the deciding 51st vote, if needed.)

The Graham-Cassidy-Heller-Johnson bill would have the following actions:

  • Eliminate Medicaid expansion, tax credits, cost-sharing reduction subsidies, and the basic health plan
  • States would, instead, receive block grants to replace federal funding for the canceled programs and have “significant latitude” over how to address their unique healthcare needs
  • Repeal the ACA individual and employer mandates
  • Maintain most of ACA taxes, but repeal the medical-device tax
  • Weaken ACA protections on pre-existing conditions

At press time, the only confirmed Republican “no” vote is Rand Paul (KY). Other Republican Senators reportedly on the fence are Mike Lee (UT), Lisa Murkowski (AK), and John McCain (AZ). McCain’s stance has attracted particular attention, as he cast the deciding vote torpedoing the Senate’s previous effort to repeal/replace the ACA—but one of the current bill’s primary sponsors is his good friend, Graham, and the Arizona governor has also gone on record supporting the bill.

Democratic leaders Nancy Pelosi (CA), Chuck Schumer (NY), John Yarmuth (KY), and Bernie Sanders (VT) insisted the Congressional Budget Office (CBO) analyze the bill before any vote is taken. The CBO has stated that it would release a preliminary assessment of the bill early next week, but a detailed analysis of the legislation’s impact on insurance coverage or the federal deficit would not be available for weeks. A Kaiser Family Foundation analysis released yesterday estimates overall federal funding for coverage expansions and Medicaid would be $160 billion less than current law for the period from 2020 to 2026 under the Graham-Cassidy bill, with 35 states plus DC facing a loss in funding.

 

Biosimilar Coding—Could There Be Billions in Hidden Savings?

 
 

The finalized Medicare payment rule from the Centers for Medicare & Medicaid Services (CMS) for biosimilars creates a single, blended Medicare reimbursement rate for the biosimilars based on the average sales price (ASP) of all biosimilars to a reference product, plus 6% of the ASP for the reference biologic. Under the current policy, CMS estimates Medicare savings of $25 billion over 10 years.

Our reimbursement experts worked with the Biosimilars Forum and modeled alternative methodologies that could increase savings by an additional $15.1 billion, or 30% ($65.0 billion in total over 10 years). The study titled, “Estimating the Budgetary Impact of Biosimilar Coding Policies Under Medicare Part B,” demonstrates the need for changes in CMS reimbursement for biosimilars under Medicare Part B. Learn more

 

 

 
LEGISLATIVE UPDATE
 

Denied. Battle Lost in NV but PhRMA and BIO Continue Ahead

 
 

Two weeks ago in Health Policy Weekly, we covered PhRMA and BIO’s lawsuit against Nevada’s SB 539, which would require manufacturers to justify price increases on diabetes medications, require pharmacy benefit managers (PBMs) to disclose rebate information, and forbid PBMs from punishing pharmacists for “selling a less expensive alternative drug” to patients.

PhRMA and BIO filed for a temporary restraining order (TRO) and preliminary injunction against officials in Nevada, asserting in their joint press release that SB 539 violates patent rights, negates trade secret protection, ultimately harms patients, and stifles future biomedical innovation.

Last Thursday, a judge in the US District Court for the Nevada District denied the request for a TRO and preliminary injunction, ruling that the threshold of "immediate and irreparable injury, loss, or damage ... before the adverse party’s opposition" is heard was not met.

The industry does not appear to be giving up the battle, however. “BIO remains confident in the eventual outcome of the process,” a BIO representative told Bloomberg BNA the following day. Bloomberg BNA also reported that PhRMA “looks forward to arguing the case for enjoining the law at the October hearing.”

The industry’s perseverance is not unexpected, as it is battling similar fights across the country. According to the National Academy for State Health Policy, lawmakers in 30 states have drafted some 60 drug price transparency bills as of August.

 

Advantages of Being Your Own Boss: You Set the Deadlines

 
 

Earlier this year, the Centers for Medicare & Medicaid Services (CMS) issued new guidelines for "Market Stabilization," which included shortening the enrollment period for individual coverage under the ACA. Open enrollment in the federal exchange will be available from November 1, 2017 through December 15, 2017.

To ensure consumers have enough time to make appropriate choices, California is expected to enact AB 156, which proposes to keep the 2018 enrollment period unchanged, running November 1, 2017 through January 30, 2018. The 2019 plan year would run from October 15 through January 15. Recently passing both houses, the bill is expected to be approved by the governor.

Other states managing their own exchanges have already announced enrollment period extensions for 2018:

  • Colorado (November 1, 2017 through January 12, 2018)
  • Minnesota (November 1, 2017 through January 14, 2018)
  • Washington state (November 1, 2017 through January 15, 2018)

While policy observers have suggested that by shortening the enrollment period, the Administration is destabilizing the markets, CMS noted the new enrollment period is intended to “more closely align with Medicare and the private market.”

 

Data Strategy: The Connective Tissue Required to Bring Cell and Gene Therapies to Market

 
 

Drug Discovery & Development

Data strategy is the connective tissue that weaves together a strategic value story required to bring cell and gene therapies to market successfully. In Drug Discovery & Development magazine, Michael Eaddy, PharmD, PhD, Vice President of Scientific Consulting at Xcenda, gives in-depth insights about how manufacturers can leverage their data. Learn more

 

 

 
REGULATORY UPDATES
 

It’s Not You, It’s Me: Innovation Center Heads in a “New Direction”

 
 

In an op-ed in The Wall Street Journal Tuesday, CMS Administrator Seema Verma said the Trump administration will steer the Center for Medicare and Medicaid Innovation (CMMI) in a “new direction,” saying the complexity of the Obama Administration’s policies encouraged consolidation and providers “need the freedom to design and offer new approaches to delivering care.”

CMS followed Verma’s op-ed with a request for information (RFI) from CMMI on what form new models should take in the following areas:

Regarding “prescription drug models,” the RFI explained further that CMS is interested in determining if “models that better align incentives and engage beneficiaries as consumers of their care can continue to improve patient outcomes while controlling drug costs.”
 
CMS is also interested in models with novel arrangements among plans, manufacturers, and stakeholders across the supply chain, such as “innovative value-based purchasing arrangements” and increasing “drug-pricing competition while protecting beneficiaries’ access to drugs.”  

The new direction is undergirded by principles such as “market choice and competition,” “provider choice and incentives,” “transparent model design and evaluation,” and “small-scale testing.” These principles stand in stark contrast to several of CMMI’s models under the Obama Administration, which were characterized by mandatory participation by a large number of providers and complicated rationales.

Since his campaign, President Trump has asserted he would lower drug prices, but has, so far, taken no concrete steps to actualize that goal. This new direction of CMMI may accomplish that and other goals, but it appears stakeholders will have the opportunity to participate and shape any resulting models.

 

2017 Employer-Sponsored Health Benefit Costs Increase

 
 

The Kaiser Family Foundation and the Health Research & Educational Trust (HRET) 2017 Employer Health Benefits Survey provides a detailed look at cost-share and other trends in employer-based health insurance for workers and employers from more than 2,100 non-federal public and private large and small firms. Using an interactive graphic, the survey results show average premiums, deductibles, drug copayments, and their rate of increase compared to changes in worker’s earnings and overall inflation over time.

According to the survey, 55% of workers are covered by health plans offered by their employer. Health insurance premiums for workers in both large and small firms increased by 4% for single coverage and 3% for family coverage over 2016 rates. This increase was slightly greater than changes in workers’ wages (2.3%) and inflation (2.0%) over 2016.

In 2017, preferred provider organization (PPO) plans continued to be the most common plan type at 48% enrollment, with high-deductible health plans with a savings option (HDHP/SOs) in second place at 28%. PPO plan use has fallen 8% over the last 5 years while HPDP/SO use has increased by 9%.

Firms offering health benefits also offer a variety of supplemental and other health benefits to their workers, as shown in the table below.

Though the report touts the “remarkable slowdown” in premium increases since 2012, it brings comparatively less attention to the much greater cost-sharing employees now shoulder in the same time period. Workers’ average contribution to family premiums has increased more rapidly than the employers’ share since 2012 (32% vs 14%). Additionally, the percentage of workers with an annual deductible of $1,000 or more for single coverage has grown substantially, increasing from 34% in 2012 to 51% in 2017.

While the slowdown in health insurance premiums is noteworthy, far more important for many people is their greater overall cost-sharing burden. A modest premium increase offers little succor when deductibles, coinsurance, and copayments are increasing at a far greater rate.

 

Location, Location, Location Matters for Imaging

 
 

In real estate and increasingly now in the healthcare industry, one aspect has proven to be particularly important—location—as most recently exhibited by healthcare giant Anthem’s new imaging services policy. Effective the beginning of July, the policy mandates that individuals receive advanced imaging services at outpatient sites of care. The policy applies to covered individuals in all but one of its states.

Anthem justified the decision by citing the need to optimize quality, satisfaction, and cost of care. Applicable to computed tomography (CT) imaging and magnetic resonance imaging (MRI) scans, the policy will restrict patients from using hospitals for imaging services unless it is determined to be medically necessary.

The move by Anthem is one of many recent examples of insurers attempting to reduce costs in the face of rising healthcare expenditures; however, this move has not come without pushback. Hospitals and other stakeholders have been vocal in their criticism of the new policy. Among the critics, the American College of Radiology condemned the policy, calling it “arbitrary and unwise” and encouraged Anthem to reconsider. Expect to see more high-cost services mandated to the outpatient setting of care.

 

Information Buffet (AKA, Other Stuff That Caught Our Attention)

 
 

We kept running into stories we wanted to bring to your attention, so here’s a quick hit list of other news we thought you should know:

  • The Trump Administration will make September payments to health insurers for the ACA’s cost-sharing subsidies in exchange plans
  • CMS posted an update to the Health Insurance Exchanges Issuer County Map; 1,524 counties are projected to have only 1 issuer in 2018
  • CMS sends the final rule on calendar year 2018 updates to the Quality Payment Program to the Office of Management and Budget
  • The Pew Charitable Trusts released a policy proposal for reducing the exclusivity period for biological products to reduce drug spending
  • The Institute for Clinical and Economic Review released a draft scoping document that outlines its upcoming review of the comparative clinical effectiveness and value of the hemophilia A treatment emicizumab
  • A Kaiser Family Foundation issue brief examines the current landscape of pending and approved Section 1115 Medicaid waivers.
 
HEARD ON THE STREET
 

“On Wednesday we [issued] a request for information to collect ideas on the [new direction of CMMI]. We will move away from the assumption that Washington can engineer a more efficient healthcare system from afar—that we should specify the processes healthcare providers are required to follow.”

 

– Seema Verma, CMS Administrator

Source: “Medicare and Medicaid Need Innovation,” The Wall Street Journal, September 19

 
POLICY BY NUMBERS
 

2 of 7

 

In 2016, 2 of 7 regions for the CMMI’s Comprehensive Primary Care initiative totaled positive shared savings

Source: Comprehensive Primary Care (CPC) Initiative – 2016 Shared Savings & Quality Results, CMMI, September 20

 
UPCOMING MEETINGS & CONFERENCES
 

Cell & Gene Meeting on the Mesa

October 46 l LaJolla, CA
The Cell & Gene Meeting on the Mesa is a 3-day conference bringing together senior executives and top decision makers in the industry with the scientific community to advance cutting-edge research into cures. World Courier, part of AmerisourceBergen, is proud to be a Gold Sponsor of this unique event. The meeting features a nationally recognized Scientific Symposium, attended by leading researchers and clinical experts from around the globe, in conjunction with the industry’s premier annual Partnering Forum, the first event of its kind dedicated solely to facilitating connections in this sector. Learn more

 

AMCP Nexus 2017

October 1619 l Dallas, TX
Join Xcenda at this year’s AMCP Nexus 2017 conference in Dallas, TX. AMCP Nexus 2017 will explore perhaps the most transformative change taking place in healthcare: how we pay for healthcare and the emergence of value as the defining factor and goal. Xcenda’s team of experts can help you navigate the value landscape and maximize access for your product. Visit Xcenda’s booth in The Exchange at #503, or contact us to schedule a meeting at the conference. Learn more

 

13th Annual Personalized Medicine Conference

November 14-16 l Boston, MA
Join Jennifer Snow, MPH, Director of Health Policy, at the 13th Annual Personalized Medicine Conference in Boston as she moderates a panel titled, "Precision Valuation: A Discussion of How Value Assessment Frameworks Can Account for Personalized Medicine." Learn more

 
 
FEATURED CONTRIBUTORS
 

EDITOR-IN-CHIEF:
Jennifer Snow
Director,
Health Policy
Xcenda

MANAGING EDITOR:
Scott Shields
Associate Director,
Health Policy
Xcenda

 

ADVISORY BOARD:

Peyton Howell, MHA
President | Global Sourcing & Manufacturer Relations | AmerisourceBergen Corporation

Amy Grogg, PharmD
Senior Vice President | Strategy & Commercialization | AmerisourceBergen Corporation

Tommy Bramley, PhD, RPh
President | Xcenda

Stacie Heller
Vice President | Government Policy | AmerisourceBergen Corporation

Rita Norton
Senior Vice President | Government and Public Policy | AmerisourceBergen Corporation

Ana Stojanovska
Vice President | Reimbursement & Policy Insights | Xcenda

CONTRIBUTING AUTHORS:

Andrew Gaiser | Milda Kaitz | Scott Shields | Stephen Wilson

PRODUCTION:

Kylie Matthews | Ellen Olson | Froila Pacanins

 

Sept. 22, 2017

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