Category Archives: Policy and politics

Health Wonk Review: Presidents’ Day edition

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With Presidents’ Day on Monday, school vacations in Massachusetts and New York, not to mention the throngs soaking it up at HIMSS, it’s relatively quiet in the healthcare wonkosphere this week. Nonetheless, I have managed to collect a few solid entries for your reading pleasure.

Workers’ Comp Insider has a “bone to pick” with former President Obama for not doing enough to fight for ObamaCare and educate the public about its merits. But the last few lines are telling as the post focuses on the cluelessness of the ‘dogs that caught the bus’ (i.e., Republicans). And the PS says it all.

Managed Care Matters notes that mayors lose their jobs when they do a poor job cleaning up after a snowstorm. That’s what may happen to the GOP at a national level with healthcare, except that healthcare is a lot more complex than snow removal. We shouldn’t expect much real progress on healthcare legislation anytime soon.

InsureBlog has been cheering for ObamaCare’s demise since before there was an ObamaCare, and its Running out the clock post continues on that theme. The new news: Repeal may not be needed if current trends continue, including Trump’s executive order that removes enforcement mechanisms for the individual mandate.

Health Affairs blog explains the Trump Administration’s Market Stabilization Proposed Rule, which is designed to keep the individual insurance markets viable for health plans while the GOP ponders what to do longer term. Colorado Health Insurance Insider explains the implications of the rule overall and for Colorado specifically.

Healthinsurance.org warns that ObamaCare supporters won’t go quietly into the night. The Families USA conference reminds us that ACA repeal isn’t inevitable and that grassroots communications strategies to preserve gains in coverage and access can be effective.

In my Health Business Blog post on the Cadillac Tax, I speculate that Congress may leave the unpopular levy in place rather than expending energy on the politically difficult initiative to replace it with a GOP version that does essentially the same thing with a different name.

As I understand it, it’s really easy to extract oil in Saudi Arabia because rich deposits are right near the surface. When it comes to locating conflicts of interest, Health Care Renewal now finds itself living in the equivalent of Saudi, where Trump Administration officials from the President on down are barely trying to conceal their conflicts. Today’s tale is: Making health care conflicts of interest great again. A consultant to Medicaid and simultaneously to Medicaid vendors for CMS?

The ever insightful Drug Channels analyzes data from Express Scripts to conclude that having the government (or maybe Mr. Trump himself?) take over drug price negotiations for Medicare wouldn’t actually reduce overall costs. There’s utilization management to take account of, not to mention the impact of drugs on overall healthcare costs.

Image courtesy of nirots at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.

 

Can Congress agree on the Cadillac tax?

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Cadillac taxi?

Health care is too costly in the US. One reason is that health insurance premiums are fully tax deductible for employers. This distorts the market, causing employers and employees to prefer devoting the next dollar of compensation to healthcare rather than wages. That’s fine in any given year but over time it’s helped drive up healthcare spending and hold down wages.

One of the many things the Affordable Care Act did right was to start to address this issue with the so-called Cadillac Tax, an excise tax on high cost employer plans. Like everything in the ACA it has been attacked and derided by the law’s opponents. But many Republican plans have equivalent measures, which would cap the deductibility of health insurance. Either one of these approaches would help by causing employers to work harder to hold down healthcare spending and by generating tax revenue that could be used for other health law goals or for general purposes. The end of tax deductibility only kicks in at a high threshold, which means the impact in the early years is limited and everyone has time to get used to the new rules. I’d like to see Congressional leaders be brave and embrace some form of cap as a bi-partisan consensus move.

Alas, the caps are opposed by an array of forces: employers don’t want a new tax, labor groups are worried that benefits will be eroded and out-of-pocket costs increased, and the healthcare industry worries about a squeeze on revenue.

Without strong leadership in Congress, it seems doubtful that new legislation will be passed. So maybe the best bet is to leave the Obama era Cadillac tax in place, imperfect as it may be.

By healthcare business consultant David E. Williams, president of Health Business Group.

 

What if the FDA is eliminated?

President Trump’s first couple of weeks have people taking him literally, not just seriously. What does that mean when it comes to the regulation of drugs?

As I wrote in early December (Would an FDA radical make any real difference), I’m not convinced that even a major shift away from regulation will dramatically change the market. Even if the bar for approvals is lowered, third-party payers will still want to see compelling safety and efficacy data before they provide reimbursement. Medicare and Medicaid may also up their game by directly or indirectly discouraging prescribing of medications that are unproven.

The pendulum tends to swing back and forth between the demand for speedy approval and concern about harms to patients from inadequately tested drugs. Recently the pendulum has been swinging toward fast approval, and the newly enacted 21st Century Cures Act continues that trend.

But what will happen when a drug that’s rushed to market causes patient injury and death?

“We’re going to be cutting regulations at a level that nobody’s ever seen before. … And we’re going to have tremendous protection for the people — maybe more protection for the people,” Trump said Tuesday.

Trump is promising the impossible, and it may come back to bite him. Then again, maybe it won’t.

Rerun: We need a liberal immigration policy to support health care reform

I went down to Copley Square, Boston yesterday to protest President Trump’s Executive Order on immigration. I’m very concerned about the direction the country is taking. Beyond that, I’m also saddened at the lack of appreciation for immigrants in building our economy and helping health care reform succeed. Below is a rerun of my blog post from 2011.


Over the last decade, the United States has intentionally made itself less attractive to immigrants, forgetting that immigration has been a huge driver of the country’s economic success. In a recent article (America needs a 21st century immigration policy), leading entrepreneurs, executives and investors including Steve Case and Sheryl Sandberg said:

To some, the link between immigration reform and economic growth may be surprising.  To America’s most innovative industries, it is a link we know is fundamental.

The global economy means companies that drive U.S. job creation and economic growth are in a worldwide competition for talent.  While other countries are aggressively creating policies and incentives to attract a highly educated workforce, America has stagnated.  Once a magnet for the world’s top minds, America now faces a “reverse brain drain” and is no longer the first choice for many entrepreneurs creating new companies and jobs.

America needs a pro-growth immigration system that works for U.S. workers and employers in today’s global economy.  And we need it now.

Openness and encouragement of immigration is vital for the success of health care reform. Why?

  1. Immigrants innovate and create economic growth. This growth is how the country gets wealthier and better able to support health care expenses without raising tax rates
  2. Immigrants tend to be younger, so they mitigate the overall aging of the population, making it easier for the country to afford its commitments to older citizens
  3. Immigrants can use their intellectual capital and training –whether acquired abroad or here– to fill health care jobs such as primary care physician, pharmacist, nurse that would otherwise go unfilled

President Obama actually understands this dynamic, but has to tread carefully since immigrant bashing is so popular on the right. But unfriendliness to immigration is all over in the place. For example in Massachusetts the state has decided –for short-sighted financial reasons– to exclude legal immigrants from subsidized health insurance. With luck, that decision will be overturned as unconstitutional by the state’s Supreme Judicial Court.

I agree with the Republican rhetoric of the need for a “pro-growth agenda.” Low taxes and limited regulation can certainly play a part. But policies that encourage immigration, especially of younger, well educated people, are absolutely essential. We need it for the economy as a whole and for the health care economy in particular.