Top Policy News from the Week

Legislation  |  Surprise Billing

Providers Lose Out in Latest Bipartisan Surprise Billing Draft

• What’s New: Bipartisan leaders in Congress in both the House and Senate drafted a bill to combat surprise billing.

Details of the Surprise Billing Bill.

The new bill is an altered version of older proposals. For bills under $750, insurers would pay providers at least the median in-network rates for that region. You might have seen reporters call this the “benchmark rate” method.

• For bills over $750, insurers and providers will negotiate through a third party – called the “arbitration” method.

Who Wants What.

Providers oppose the benchmarking part of the deal. They think the bill will lower reimbursement by giving them less room for negotiation (it will).

• Insurers oppose arbitration because their negotiating leverage for larger costs goes out of their hands. So, since nobody’s happy, the bill is probably closing in on the right solution.

You should know: New York tried 3rd party arbitration to combat surprise billing in 2015. The catch? The bill guided arbitrators to use use the 80th percentile of billed charges as the starting point.

• Here’s the problem with that: charges are generally made up numbers and do not correlate to actual reimbursement. Providers charge a certain amount for healthcare services but receive lower reimbursement from insurance/patients.
• As a result, providers ended up receiving higher payments in New York.

If Congress pegs the arbitration to a high level of charges like New York did, insurers could lose out big time. But it’s important to note that the national bill is different because it includes benchmarked rates.

Conclusion.

• Who loses: Providers
• Who’s in the middle: Insurers
• Who wins: Patients

Keep in mind that this bill, while bipartisan, still has a long way to go – especially since a House panel just introduced a rival proposal. But these same solutions have been floating around Congress for a while now.

Go Deeper From Bloomberg: Patients and insurers are the big winners in the latest surprise medical bill deal.

ACA  |  Supreme Court

SCOTUS Leaning Toward Insurers in Latest ACA Legal Battle

The ACA is back in the Supreme Court. This time, big insurance companies are accusing HHS of pulling a classic bait-and-switch.

Details.

The insurers claim that HHS promised to subsidize certain ACA plans if insurers entered that market. Unfortunately, Congress defunded this part of the ACA, and insurers weren’t paid. Cue insurance companies suing HHS for $12 billion.

Important: Remember to distinguish THIS case from the from the other ACA case, where the courts are assessing whether the ACA is still constitutional after Congress dropped its individual mandate clause at the end of 2017, which previously had required everyone to have insurance coverage or face a fine.

• Other ACA Updates: The latest government spending bill is expected to remove two of the ACA’s more controversial taxes – the medical device tax and the Cadillac tax. Also in the deal? Raising the tobacco age limit to 21.

CMS  |  Insanity

A Counseling Session for Healthcare Leaders

In what has been described as a “f******” soap opera (fill in the blank), White House officials have been mediating counseling sessions between HHS head Alex Azar and CMS head Seema Verma. Speaking of Ms. Verma, she’s had quite the week:

• Ironic Timing: Modern Healthcare named Seema Verma healthcare’s #1 most influential person in 2019.
• You should see yourself out: Joe Kennedy wants CMS Head Seema Verma to resign after reports surfaced that she had asked taxpayers to reimburse her for $47k related to stolen jewelry on a work trip. Charges were, of course, dropped for insufficient evidence.
  • This story was allegedly leaked by HHS officials, which goes to show the relationship both sides have with one another if that turns out to be true.

From the WSJ, certain CMS employees are now accusing HHS of sexism. Quotes from the article:

• “We call the sixth floor the ‘tall white men’s club.’ …This is so much bigger than these little stories. HHS is no longer a safe environment.”
  • HHS reps disagreed. “HHS is one of the most friendly places for women.”

Conclusion: I wouldn’t want to work there.

Policy  |  2020 Election

Latest Healthcare 2020 Election News

From Politico: Andrew Yang’s six-step plan for healthcare. Hint: it doesn’t involve Medicare for All.

Drug Pricing: House Democrats passed Nancy Pelosi’s drug pricing bill. Even though it’s dead on arrival in the Senate, it shows how Democrats are thinking about drug pricing going into the 2020 election.

• Details of the bill: direct government negotiation of drug prices, strict inflation controls, and interestingly, expansion of Medicare to cover dental, vision, and hearing.

Vapers: Will the vaping demographic swing the 2020 election?

Divergence: Republicans and Democrats are far apart when it comes to healthcare. In my brief experience, healthcare views tend to get politicized pretty quickly, so this poll’s results make sense.

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