David Nather
Featured

Trump signs FDA funding bill into law

AP

President Trump has signed into law a bill reauthorizing the user fees that help fund the Food and Drug Administration.

  • It was one of the last bills the Senate passed before leaving for the August recess, and it could have easily turned into a battle, since the Trump administration wanted to restructure the medical product user fees to make the industry pay the full cost of product reviews.
  • But congressional Republicans and Democrats ignored the request, and the administration didn't push the issue.
  • Notable: It's one of the rare health care bills that's significant and yet passed easily, with bipartisan support and without a fight — and it could be one of the last for a while.
Featured

The Menendez scenario for reviving ACA repeal

Julio Cortez / AP

No, Sen. Joe Manchin isn't going to become Energy secretary — the dream scenario some White House officials had for replacing a Democratic senator with a Republican, thereby gaining the 50th vote for Affordable Care Act repeal. But the New York Times reports that there's another, not totally implausible scenario — because Democratic Sen. Robert Menendez is going on trial soon on federal corruption charges.

  • If the New Jersey senator is convicted, he could resign, or the Senate could vote to expel him (it would take two thirds of the Senate to throw him out).
  • Either way, New Jersey Gov. Chris Christie would appoint his replacement — who would almost certainly be a Republican.
  • The odds: It's really not knowable until the trial begins and we get a better sense of the case against Menendez. For now, it's just another “what if" scenario. But it's not impossible.
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Vitals

Good morning ... Vitals is off next week, and so am I! See you a week from Monday. In the meantime, please bookmark and check the Axios health care news stream every day for the latest in health care politics and business.

Bernie Sanders tries to flesh out “Medicare for All”

Rebecca Zisser / Axios

There's been a lot written lately about how Democrats are going to have to start working out details about single payer if they're serious about running on it. Now, we're getting a better idea of how Bernie Sanders will address some of them — though not all of them — in the “Medicare for all" bill he hopes to introduce next month.

The bottom line: It will give some basics on how to handle one of the main practical issues: how to manage a transition to the new system, according to aides. But don't expect a detailed explanation of how to pay for it, which of course is one of the biggest questions everyone will ask. And no, private insurance companies wouldn't have much of a role to play.

For more about what we’re likely to see, read my story here.

Trump vs. McConnell

There's been so much drama between President Trump and Senate Majority Leader Mitch McConnell this month that you may be wondering why McConnell would ever take another crack at Affordable Care Act repeal, as Trump wants. And it's not helping Trump's influence with Congress that Republicans have to disavow everything he says about Charlottesville, white supremacists and neo-Nazis.

The bottom line:

  • Whatever McConnell does next will be dictated by whatever he thinks in Republicans' best interests, not what's in Trump's interests.
  • If he can get enough of a win for Republicans out of a bipartisan deal to stabilize the ACA markets — like a deal with beefed-up state waivers — he'll try to pass that.
  • A McConnell ally pointed out to me that the majority leader has said he won't bring up anything that doesn't already have enough votes to pass.
  • But safe to say, Trump hasn't exactly made himself another LBJ in his influence with Congress.

The hospital hiring bubble

Hospitals continue to add more jobs to the economy, though at a slower rate than the past. Bob Herman points out that something will have to give. Either hospitals will run up the national health care spending tab through bigger payrolls, or layoffs are coming (and some already are).

Bob reported in March how labor costs are outpacing the revenue that hospitals are collecting. He found more of that after digging through new financial reports of large not-for-profit health systems:

  • Providence St. Joseph Health, based in Washington state, is clutching onto razor-thin profit margins. Its operating margin in the first half of this year was 0.4%, and that was an improvement from last year’s 0.1%. Layoffs are on the way, and Providence executives told bondholders that "increasing labor and supply costs remain" as one of their most significant challenges.
  • Edward-Elmhurst Health in suburban Chicago will lay off employees as its operating profit dwindled to just above break-even.
  • Operating income at Fairview Health, a large system in Minnesota, dropped 39% in the second quarter of this year. Fairview executives cited "higher salaries and benefits" as a major reason for the decline.
  • Employee costs at Inova Health, a hospital system in the Virginia and D.C. regions, increased by $67 million, or 9%, in the first half of this year and outpaced revenue growth. Inova has employed a lot more physicians and also paid premium bucks for temporary workers in its operating rooms and critical care units.

Price claims EpiPen as a drug costs victory

Health and Human Services secretary Tom Price has been looking for anything he can call a victory over rising drug prices. Yesterday, he found one: Mylan’s agreement with the Centers for Medicare and Medicaid Services to reclassify the EpiPen as a brand-name rather than a generic, which would require it to pay bigger rebates to Medicaid.

What Price said: "CMS Administrator Seema Verma and the team at HHS are working every day in support of President Trump's goal of lowering the costs of drugs and medical devices in our country and making healthcare more affordable.”

Reality check: The agreement may help the taxpayers who pay for the Medicaid program, but most people will be focused on what they pay out of their own pockets for prescription drugs. And Republican Sen. Chuck Grassley wasn’t impressed anyway: He said the settlement amount "shortchanges the taxpayers,” given that they may have overpaid for the EpiPen by nearly $1.3 billion over 10 years.

What CMS said: Verma’s victory statement was more narrow: "This announcement puts drug manufacturers on notice that CMS remains vigilant in our duty to protect the integrity of the Medicaid program."

Humana CEO’s thumbs up for 23andme

Bruce Broussard, Humana’s president and CEO, has a LinkedIn post about the 23andMe home genetics tests that gives the company a strong defense — calling it an example of "the disruptive power of technology in health care.” Here’s why:

"Some might argue that home genetic tests tread on doctors' turf and complicate their jobs. But the opposite is true -- patients who have a detailed understanding of their genetic risks let doctors focus on the sickest patients.

Given how little time physicians, clinicians, nurses and other care professionals have in their day-to-day schedules, empowered patients are good for the system. And, as other highly regulated industries have learned, dramatic change can make life better for all of us.”

Yes, but: There’s still a lot of ways people can misinterpret the tests. They can make you think you’re at greater risk for a disease than you actually are — and they can also make you think you’re in the clear when you’re actually not. Read STAT’s Sharon Begley for a smart breakdown of how the tests really work.

What AI in medicine still has to prove

We'll do one more entry in our running dialogue on the use of artificial intelligence in medicine. This time we're returning to Joel Zivot of Emory University, an anesthesiologist who has a background in bioethics, whom we quoted in my first piece about the Human Diagnosis Project's AI initiative:

  • "The wisdom of crowds is understood as a limited concept. The doctor needs to listen and the patient needs to explain. Doctors can be bad listeners, both singularly and collectively. Some patients are unable to clearly explain their complaint.“
  • "Any reasonable review of a claim that this project is solving a problem will first need a clear articulation of said problem and a thorough evaluation of data by impartial individuals.
  • "The doctor-patient relationship is not simply strengthened with more opinions made by an international crowd of nameless physicians. The doctor-patient relationship is strengthened with trust.
  • "Machine intelligence intends to exceed its program and AI 'physicians' will make very different decisions about human patients more than anyone might reasonably imagine."

Stay tuned: This is a worthy running dialogue, so we'll do more of it when we can. Please keep reading Vitals, and Axios, for more on this debate — because it's going to affect all of us.

What we're watching in September: Senate HELP Committee hearings on bipartisan ACA stabilization bill, week of Sept. 4; markup of Senate funding bill for HHS, same week; Senate Finance Committee hearing on CHIP reauthorization, same week.

Also, Healthcare Security Forum, sponsored by the Healthcare Information and Management Systems Society, Sept. 11-13.

Let me know what you'd like to read about when Vitals returns: david@axios.com.

Featured

Bernie Sanders’ first draft of “Medicare for All”

Rebecca Zisser / Axios

There's been a lot written lately about how Democrats are going to have to start working out details about single payer if they're serious about running on it. Now, we're getting a better idea of how Bernie Sanders will address some of them — though not all of them — in the "Medicare for all" bill he hopes to introduce next month.

The bottom line: It will give some basics on how to handle one of the main practical issues: how to manage a transition to the new system, according to aides. But don't expect a detailed explanation of how to pay for it, which of course is one of the biggest questions everyone will ask. And no, private insurance companies wouldn't have much of a role to play.

Here are some of the practical issues and how Sanders is likely to address them:

Transition: As The Nation pointed out in a widely read article this month, no single payer bill yet has really explained how to move from our current system to the new one, or how long it should take to avoid total disruption. The Sanders bill is likely to make the transition gradually, by lowering the Medicare eligibility age over time and providing a government-run "public option" for everyone else.

How to pay for it: This is where the California single-payer effort got bogged down, and the Sanders bill isn't likely to provide much of a road map either. That's because the Sanders team doesn't want to get caught up in fights over the financing. They just want to start the debate over whether health care should be considered a right, and then work out the details later.

Role of private insurance: Even though single payer can be done with private insurance companies (within a government guarantee), the Sanders bill won't have a big role for them, other than providing supplemental insurance. That could earn them some powerful enemies: As liberal health care expert Zeke Emanuel points out, if health insurance companies are cut out of the picture, "they have a existential threat and will oppose with everything they have."

Benefits: There's a lot that Medicare doesn't cover right now, and the benefits are more geared to older customers than working-age adults anyway. Sanders is likely to rework the benefits by basing them on the Affordable Care Act's “essential health benefits," to make them more appropriate for all age groups.

What to watch: Sanders is sure to face tough questions, and so will any Democrats who run on single payer without thinking through the implications . But some Democrats think it's smart politics not to provide too much detail just yet. "The bells and whistles of a single payer system are a political mine field," said Chris Jennings, a former health care adviser to Bill and Hillary Clinton. "They should be avoided and are unnecessary for now."

Featured

Vitals

Good morning ... So many big decisions ahead. Democrats have to figure out what they're going to do next on health care. And any health care CEOs who haven't already run away from President Trump have to decide if now's the time.

On the bright side, the Trump administration is going to give insurers their cost-sharing reduction payments for another month. Then we get to go through the whole thing again next month!

What's next for Democrats on health care

Giphy

Caitlin Owens has a smart look this morning at what's ahead for the Democrats now that the Republican health care efforts have fallen apart. They could just sign on to an Affordable Care Act stabilization bill, Caitlin writes, but they've got bigger decisions to make about what comes after that, especially in 2020.

What to watch: Yes, there's a growing movement to embrace single payer, but it's not a sure thing — and some Democrats say they would be smarter to focus on how to make health care more affordable, which is the voters' big concern.

Why this matters: Democrats have a unique opportunity to emerge as the adults in the room after the GOP's repeal and replace debacle. But they could squander it if they blindly defend the ACA without addressing its shortcomings, or if they jump into political arguments over single payer. Voters have been clear about what they want, and so far neither party has offered a real solution.

Read more here.

Trump’s business council meltdown

Here's how quickly everything fell apart: It only took two days from the time Merck CEO Kenneth Frazier stepped down from Trump's manufacturing council to Trump's tweet yesterday announcing he was ending both of his business advisory councils. (He did that after the other CEO group told Trump they were disbanding, per the Wall Street Journal.)

The result: The quick decision by the CEOs spared the Cleveland Clinic's Toby Cosgrove, a member of the Strategic & Policy Forum, from having to make his own statement about Trump's disastrous "blame on both sides" remarks on Charlottesville. But he signed onto the group's statement yesterday, which declared that the CEOs' debate over whether to keep participating in the forum had become “a distraction."

Distance from Trump: Other health care CEOs are running away at full speed from Trump's statements equating the actions of white supremacist and neo-Nazi protesters with anti-racism demonstrators.

  • Johnson & Johnson CEO Alex Gorsky, a member of the manufacturing council, put out his own statement calling Trump's latest Charlottesville remarks “unacceptable," according to Meg Tirrell's tweet and other reports.
  • And CNBC reported that Aetna CEO Mark Bertolini, in an internal memo, said he was “ashamed of our President's behavior and comments."

The bundled payment fallout

The proposal by Tom Price's Medicare agency to retreat significantly from bundled payments would have made more waves during a normal news cycle. Here's Bob Herman read on how the policy shift could affect different parts of the health care system:

  • Hospitals and doctors: It's mixed. Hospitals weren't thrilled about the programs where they were required to take a tight fixed amount for a joint or heart procedure, and high-earning surgeons knew a lump sum meant potentially less money to go around. But the American Hospital Association said the cancelled programs "may be disruptive to providers who have expended valuable resources to put these programs in place."
  • Home health and rehab facilities: Bundled payments not only cover the procedure in the hospital, but also any follow-up care. Home health and rehab companies will still feel pressure to make sure patients don't return to the hospital needlessly, but more bundled payments would have intensified the pressure.
  • Medical device companies: Bundled payments force doctors and hospitals to ditch high-cost devices and implants if they want to make a profit. "These changes should have a very modest positive impact on the orthopedic sector and med tech more broadly," Michael Weinstein wrote in a note for JPMorgan.
  • Health insurers: Some insurers are still charging ahead with their own bundled payment strategies, even if Medicare pumps the brakes.

Food for thought: Robert Berenson, an Urban Institute fellow and former Medicare official, told Bob last year it's unclear if bundled payments would reduce unnecessary or harmful care, and it's possible instead that people would "get a more efficient, unnecessary episode of care."

A followup on the Human Diagnosis Project

We like to think of Vitals as an running conversation, and judging from the reaction to my piece yesterday on the Human Diagnosis Project, there's going to be a lot more to say about the use of artificial intelligence in medicine — because it's a subject that will affect all of us in deeply personal ways.

We heard from Jay Komarneni, the founder and chair of the project (also called Human Dx), and wanted to give you a better sense of how he thinks about the project. We're also going to gather more viewpoints in the future from those who are deeply skeptical of AI in medicine.

Here are the highlights of Komarneni's response:

How do you know it works: "For over a year, we have been able to see that the collective intelligence of physicians solving cases together using Human Dx significantly outperforms the vast majority of individual physicians solving cases alone on the system." The research has been validated by Harvard's David Bates.

Can it really duplicate the doctor-patient relationship? "Human Dx definitely cannot duplicate the doctor-patient relationship, and that is the exact opposite of its intended goal...Our goal is to help empower and strengthen that relationship with better knowledge, which can lead to better care, and thus an even closer doctor-patient relationship over time."

Is it scientific? "Human Dx isn't a business idea, it's an open knowledge project...[It] is already being used as a training and teaching tool at many of the country's top academic medical institutions."

The bottom line: "This is one of the first applications of a larger idea that will take decades to play out, not dissimilar from other open efforts that have transformed society — like Wikipedia, Linux, or the Internet itself — and will hopefully one day help all of humankind."

Whatever happened to Zika?

This was easy to miss, but the Zika virus has become almost a non-issue in the United States this summer after all of the time and energy we all spent on it last summer. Science magazine has a timely look at what happened — and why there was only one case of locally transmitted Zika in the continental United States this year, as opposed to hundreds last year:

  • There are a lot fewer Zika cases in Latin America and the Caribbean now, and there’s a lot more immunity among the population than there used to be.
  • That means there are fewer infected people traveling to the United States.
  • Therefore, mosquitoes are less likely to spread the virus here.

The bottom line: The public health crisis was always real, but it turns out that infectious disease experts always expected that people would develop immunity after the initial outbreak. They just didn’t think it would happen so soon.

The new Hospice Compare site

We don't usually make a big deal of it when a government agency announces a new health care website, because it's kind of a “so what." But it's worth knowing that the Centers for Medicare and Medicaid Services runs a collection of websites to let people compare the quality ratings of hospitals, nursing homes, and other facilities — and, as of yesterday, hospice agencies.

What it does: The Hospice Compare website lets people look up services to help keep dying patients as comfortable as possible, and compare them to the national average on measures like how thoroughly their patients were checked for pain and shortness of breath.

Why it matters: Like the other websites, such as Hospital Compare and Nursing Home Compare, it won't tell you everything you need, but it'll give you a pretty good idea of what you're likely to get.

And, speaking from personal experience: When you're trying to help a dying family member, like a parent, the last thing you want to do is take the chance that they'll get terrible care.

What we're watching in September: Senate HELP Committee hearings on bipartisan ACA stabilization bill, week of Sept. 4; Senate Finance Committee hearing on CHIP reauthorization, same week; Healthcare Security Forum, sponsored by the Healthcare Information and Management Systems Society, Sept. 11-13.

What else are you watching on the health care front? Let me know: david@axios.com.

Featured

Trump administration to make ACA insurer payments for August

AP file photo

Looks like the Trump administration isn’t cutting off the Affordable Care Act insurer payments just yet. It’s going to make the August payment for cost-sharing reduction subsidies for low-income people, according to a White House spokesman.

Why it matters: President Trump threatened on Twitter last month to stop the payments, calling them “bailouts” for health insurance companies. But the administration quickly cooled that talk and has apparently backed off for one more month. But it still doesn’t want to make any long-term commitments, since Congress didn’t fund the payments — and the uncertainty could still lead insurers to announce bigger ACA premium increases.

Featured

Vitals

Good morning ... We're going to catch up on a new artificial intelligence initiative that could improve medical care for underserved patients, as long as we ask the right questions about it.

And the Congressional Budget Office gave all of the warnings we expected about cutting off insurer payments, but there were a few surprising twists, too.

A skeptical look at a new AI medical initiative

Rebecca Zisser / Axios

What if a doctor could use an artificial intelligence app to “crowdsource" the advice of specialists from around the country to double-check a patient's diagnosis? A group called the Human Diagnosis Project is getting a lot of attention for its initiative to help doctors do that in underserved areas — an initiative that got the backing of the American Medical Association last week.

You can read more about the project elsewhere (here's a good writeup from Scientific American), but we wanted to check in with doctors to see how useful they thought the new technology would be. Turns out they had a few doubts. They’re not sure how we’d know if it’s giving good advice or bad advice, or how it could ever duplicate what’s unique about the doctor-patient relationship, or whether it should even be considered a science.

We ran all of this by the Human Diagnosis Project and got some answers, so if you want to check it out, read my story here.

What you may have missed in the CBO report

Great news! Did you know that if the Trump administration cuts off the Affordable Care Act cost-sharing reduction payments to insurers, the uninsured rate would go down starting in 2020?

That was the CBO's conclusion in its report on the CSRs yesterday. That left us scratching our heads, but here's CBO's reasoning: The ACA's tax credits would increase to cover the higher premiums, so buying individual health insurance would become "more attractive for some people." And if more people want to buy insurance, the uninsured rate goes down.

Otherwise, the report was mostly terrible news, including a 20% premium increase for 2018 and a $194 billion increase in the federal deficit over the next 10 years (because of the bigger tax credits to cover the higher premiums).

A few other notable points beyond the headlines:

  • CBO assumed that all of the premium increases would be loaded onto the “silver" ACA plans, the kind that are eligible for the CSRs. If insurers instead spread the premium increases across all kinds of ACA plans, the results would be different.
  • “Gold" plans — which currently are more expensive than silver plans because they cover more of the medical costs — could actually become cheaper than silver plans for people with incomes between 200% and 400% of the federal poverty line. (That's because CBO assumes the silver plans would have all the premium increases.)
  • Despite the short-term rate hikes, most people's premiums would end up "similar to or less than what they would pay otherwise." (Thanks, tax credits.)

The Nevada problem is solved

Now that Centene's SilverSummit Healthplan is expanding to cover all 14 of the Nevada counties that might have had no ACA options next year, here's a compare-and-contrast with Anthem, which pulled back in June to offer coverage only in the state's three most heavily populated counties:

Anthem statement, June 28:

"Today, planning and pricing for ACA-compliant health plans has become increasingly difficult due to a shrinking and deteriorating individual market, as well as continual changes and uncertainty in federal operations, rules and guidance, including cost sharing reduction subsidies and the restoration of taxes on fully insured coverage."

SilverSummit statement, Aug. 15:

"We strive to be a responsible partner with the state and are committed to working closely with regulators and policymakers to be able to offer affordable coverage options for Nevada residents."

The bottom line: Centene faces all of the same challenges Anthem faces with the ACA markets, but it has figured out how to make the business work, largely through narrow networks and low premiums. Here's what Bob Herman wrote about the insurer earlier this summer.

More teenagers are dying from drug overdoses

Data: Centers for Disease Control and Prevention; Chart: Chris Canipe / Axios

Bob Herman points out these new, sobering statistics from the Centers for Disease Control and Prevention: After seven years of mostly declining drug overdose death rates among people aged 15-19, the rate ticked back up in 2015 to 3.7 deaths per 100,000 people.

Opioids — especially heroin — are by far the leading cause of drug deaths for teenagers. Overdose deaths due to synthetic opioids like fentanyl more than doubled among teenagers from 2014 to 2015.

Why it matters: The opioid epidemic isn't just affecting prime-age working adults. It's also taking the lives of more high schoolers who are too young to vote.

Trump supporters blame Congress for repeal failure

It's pretty clear from USA Today's interviews with its panel of Trump voters that Trump's not getting the blame for the collapse of the repeal effort. It's Senate Republicans all the way:

  • "Killing Obamacare was a key component of the Republican platform...The inability to move forward is embarrassing and disgusting." — Daniel Kohn, Corpus Christi, Texas
  • "We could have had a plan for this long before Trump was elected, and you would have just had to go to the bookshelf and pull the binder off." — Barney Carter, St. Marys, Georgia
  • "They've been talking about this for seven years...When the rubber needed to hit the road, they chickened out." — Rick Dammer, Zephyrhills, Fla.
Yes, but: As Carter also said: "The Hill to me has the most to blame for it, but he's got to figure out a way to solve that problem."

What we're watching in September: Senate HELP Committee hearings on bipartisan ACA stabilization bill, week of Sept. 4; Senate Finance Committee hearing on CHIP reauthorization, same week; Healthcare Security Forum, sponsored by the Healthcare Information and Management Systems Society, Sept. 11-13.

Let me know what else we should be covering: david@axios.com.

Featured

A skeptical look at a new AI medical initiative

Rebecca Zisser / Axios

What if a doctor could use an artificial intelligence app to "crowdsource" the advice of specialists from around the country to double-check a patient's diagnosis? A group called the Human Diagnosis Project is getting a lot of attention for its initiative to help doctors do that in underserved areas — an initiative that got the backing of the American Medical Association last week.

You can read more about the project elsewhere (here's a good writeup from Scientific American), but we wanted to check in with doctors to see how useful they thought the new technology would be. Turns out they had a few doubts.

How do you know it works? Ethan Weiss, a cardiologist and associate professor at the UC-San Francisco School of Medicine, said he liked the mission of trying to help primary care doctors in areas without access to a lot of specialists. But he thought the crowdsourcing approach could be vulnerable "spitting out garbage ... I'm not sure how you'd begin to demonstrate that it works or doesn't work."

The response: Justin Hamilton, a spokesman for the Human Diagnosis Project (also known as Human Dx), said it's "already in use and working," and is being used in top medical schools to train medical students.

Can it really duplicate the doctor-patient relationship? Joel Zivot, an Emory University anesthesiologist, said a successful relationship depends on a patient who can accurately describe his or her symptoms, in a logical order, and a doctor who's a good listener. Those factors don't seem to be captured with this initiative, he said.

The response: That's exactly how Human Dx works, Hamilton said. A doctor listens to the patient describe his or her symptoms, inputs the details plus the doctor's own observations into the system, and then Human Dx filters and produces advice from specialists around the world.

Is it scientific? “Let's not call it a science yet. Let's just call it a business idea," said Zivot.

The response: The project is working with medical experts from top institutions like Harvard Medical School and Johns Hopkins, Hamilton said.

Why it could work: Rasu Shrestha, chief innovation officer at the University of Pittsburgh Medical Center, called it said he's a skeptic of “embracing AI for the sake of AI." But he said the Human Diagnosis Project system could be helpful by helping doctors avoid “red herrings" and see the full range of possible diagnoses. "I think it's a noble effort," he said. "It's trying to do the right thing."

This story has been updated to correct the spelling of Dr. Shrestha’s last name.

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Vitals

Good morning ... President Trump may be whacking Merck CEO Kenneth Frazier on Twitter over and over again for leaving his manufacturing council, but Frazier already made his point about Trump's handling of Charlottesville — and his protest is what most people will remember.

But first, here's why one of the nation's biggest hospital chains is in full meltdown.

The collapse of Community Health Systems

Data: Money.net; Chart: Andrew Witherspoon / Axios

Bob Herman has a deep dive this morning into the implosion of what used to be the nation's largest for-profit hospital chain. Community Health Systems is now hemorrhaging money, sitting atop a mountain of debt and teetering on the edge of bankruptcy — all major reasons why the company has lost almost 90% of its market value.

What happened? It made the ill-advised decision to acquire Health Management Associates, a for-profit hospital chain that had a slew of financial and legal problems. Since then, it has had a crumbling market cap, billions of dollars of net losses, and a ballooning debt load. One health care investment banker called the HMA purchase "the death knell."

More here.

Merck CEO takes a stand

When Merck's Frazier announced yesterday he was resigning from Trump's manufacturing council, suggesting it was over the president's initial failure to condemn white supremacists after the Charlottesville violence, there weren't a lot of health care CEOs or advocacy group leaders who followed his lead.

  • Frazier did have two important CEOs join him last night: Kevin Plank, CEO of the sportswear company Under Armour, left the manufacturing council per CNBC, as did Intel CEO I Krzanich.
  • Krzanich's statement read like a rebuke of Trump: "I resigned because I want to make progress, while many in Washington seem more concerned with attacking anyone who disagrees with them."
  • Kaiser Permanent CEO Bernard Tyson spoke out after Trump's do-over yesterday, tweeting: "The President should consistently demonstrate zero tolerance for white supremacy, neo-Nazi groups. We must be unwavering."
  • And Georges Benjamin, executive director of the American Public Health Association, told Bob he supported Frazier's decision: "Leaders need to call out racism and hatred when they see it. That's for health care leaders or any other leader. It affects our health. It's one of those social determinants."
  • But as the New York Times' Andrew Ross Sorkin pointed out, there's no mass movement of health care CEOs, or any other CEOs, to criticize Trump's handling of Charlottesville — or to defend Frazier after Trump attacked him on Twitter following his announcement.

As one CEO told Sorkin: "Just look at what he did to Ken. I'm not sticking my head up."

“This was exactly the America I knew"

This one's really worth a read: Jennifer Adaeze Okwerekwu, a STAT columnist who got her MD from the University of Virginia, wrote about her medical school experiences in Charlottesville yesterday. She was fed up with everyone who reacted to this weekend's events by saying this isn't what Charlottesville is really like:

"In Charlottesville, this was exactly the America I knew. This was the Virginia I knew. This was the medicine I knew. Even on graduation day, one the happiest days of my life, my family broke bread at a restaurant I later learned was owned by a man affiliated with the University of Virginia who had made controversial and racist statements."

Get ready to hit “refresh” on the CBO website again

Sure, it's not as exciting as a new cost estimate for an Affordable Care Act repeal bill. But the Congressional Budget Office is putting out a report this afternoon about what happens if the Trump administration cuts off the cost-sharing reduction payments to insurers. The agency is working on the report with the Joint Committee on Taxation staff.

Suspense level: Pretty low. We know a cutoff would raise premiums, because the insurers have been telling us that. But CBO's predictions would give new ammunition to insurers who are pushing for a resolution — and to Democrats and ACA supporters who insist that Trump and the GOP are destabilizing the ACA markets with their actions.

What to watch:

  • How much premiums would increase.
  • How much market instability the cutoff would create.
  • Whether it would actually reduce federal spending or cost money, as the Kaiser Family Foundation has already predicted, since the ACA tax credits would adjust to cover the higher premiums.
  • How the Trump administration and congressional GOP leaders react. They could question CBO's methodology as they did during the repeal debate — or they could just say it won't change their minds, because they don't want “insurer bailouts" without any changes to the ACA.

Wonks aren’t ready to bail on payment reform

The evidence on all of those cool new ways of delivering and paying for health care — the ones that were supposed to save money and improve quality like bundled payments — are kind of “meh." But a team of health care experts led by Len Nichols, director of the Center for Health Policy Research and Ethics at George Mason University, writes in the Health Affairs blog that it's too early to give up on these models.

What's on the line: Accountable care organizations, care coordination, patient-centered medical homes, and bundled payments. (ACOs and bundled payments are newer ways to pay for care, while patient-centered medical homes are supposed to improve the delivery of care by creating teams of providers to meet patients' needs.)

Reasons to keep models: The team suggested various reasons why the mediocre results shouldn't be the end of the road:

  • Improvements take time.
  • Not all patients need the improvements now, so better to focus on the ones who do.
  • There could still be savings in unexpected places.
  • The small savings are still something — and "more robust cost reduction strategies“ may do better.

What we're watching today: The CBO report on cost-sharing reduction payments, of course.

What we're watching in September: Senate HELP Committee hearings on bipartisan ACA stabilization bill, week of Sept. 4; Senate Finance Committee hearing on CHIP reauthorization, same week; Healthcare Security Forum, sponsored by the Healthcare Information and Management Systems Society, Sept. 11-13.

Hit me up with other health care topics on your radar: david@axios.com.

Featured

CBO to release report Tuesday on ACA insurer payments

AP file photo

The Congressional Budget Office says it will release a report tomorrow afternoon on what would happen if the Trump administration ended the payments to insurers for the Affordable Care Act’s cost-sharing reduction subsidies. Those are the subsidies they have to give to low-income people, but weren’t funded by Congress.

Why it matters: The Trump administration has been paying them on a month-to-month basis, and President Trump has made no secret of the fact that he’d like to stop paying them.

What to watch: CBO is almost sure to say a cutoff of the payments would be damaging, leading to soaring premiums and more unstable markets. But that won’t help solve the basic problem: Congress didn’t fund the payments and isn’t about to do so, and the Trump administration is reluctant to keep paying them without specific funding from Congress.