Feb 7, 2018

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning … Seems like it’d be easier to just to go ahead and invest in mass transit, but hey, if Elon Musk wants to start by launching all of our cars into the sun one at a time, I suppose that’s still a good outcome.

Community health centers are almost out of the woods

Senate Majority Leader Mitch McConnell (on left) and House Speaker Paul Ryan. Photo: Alex Wong / Getty Images

The House last night passed its bill to avert the latest threat of a government shutdown — which also includes two years of funding for community health centers.

What’s next: The House bill favors military spending over domestic programs, which is a non-starter for a lot of Democrats. So the Senate is expected to make substantial changes to this bill, pass it and send it back to the House, where it might need to rely on Democratic votes to pass.

  • So we’re not there yet, but no one on Capitol Hill seems to be flirting with a shutdown as openly as they were last time.

What else is in there:

  • The House-passed spending bill also includes a handful of provisions to help out Medicare Advantage plans.
  • Avalere’s Caroline Pearson flagged a separate provision that would lower the price of “biosimilars” — roughly comparable to generic versions of highly complex biologic drugs.
The political risks of gutting the drug control policy office

The West Wing has thoroughly marginalized the Office of National Drug Control Policy, Politico reported yesterday, pushing aside seasoned policy staff while presidential adviser Kellyanne Conway relies on political aides to craft the White House’s response to the opioid crisis.

Why it matters: The opioid crisis is ravaging American communities at a shocking rate. It has gone on so long, and gotten so severe, that it clearly needs a public-policy response.

There’s also a political risk to the West Wing’s strategy here, especially if, as expected, its budget proposal calls for steep cuts to ONDCP.

  • Several of the most vulnerable 2018 Democrats come from states that have been hit especially hard by the opioid epidemic: Joe Manchin in West Virginia, Claire McCaskill in Missouri, Sherrod Brown in Ohio, etc.
  • Those are also all Trump states, and those Democrats are trying to strike a delicate balance: turning out the Democratic base without turning off their larger blocs of Trump-leaning constituents.
  • If you were one of those Democrats, striking that balance would be a lot easier once you could credibly beat up on the White House for sidelining and trying to de-fund the office of drug control policy while your state is in the depths of an addiction crisis.
Coming soon: lifetime limits on Medicaid?

Time limits may not be just for welfare anymore. McClatchy reports that the Trump administration may be ready to let states limit how long people can get health coverage through Medicaid.

  • Arizona, Kansas, Maine, Wisconsin and Utah are all applying for waivers to impose limits on how long people can have Medicaid coverage over the course of their lives. No such limits have ever been approved before.

Between the lines: It’s more evidence of what the Kaiser Family Foundation’s Drew Altman pointed out for us in June: most Republicans see Medicaid as welfare, not health insurance. That puts them out of step with the majority of Democrats and independents, who see it as a government health insurance program.

Yes, but: Federal law does see Medicaid as a health care program, and any states that ultimately impose lifetime limits will have to make the case in court that those rules advance Medicaid’s health care goals.

What to watch: There will be nasty political fights ahead if the waivers are approved, but it shouldn’t be surprising that a Republican administration would make its Medicaid policies more consistent with how welfare is treated.

Medicare’s hospital audit regime

Medicare paid hospitals more than $180 billion in 2016, and the feds continue to conduct aggressive audits that claw back money based on inappropriate billing, Axios' Bob Herman reports.

The latest target: the University of Michigan Health System. HHS' inspector general says UMHS has to forfeit $6.2 million after it found erroneous billing patterns with the system's inpatient rehab claims, among other medical claims. UMHS disagreed with portions of the federal audit.

Other hospital systems have been hit with even bigger clawbacks:

Bottom line: Hospitals hate the audits, arguing they are already subjected to similar payment reviews. But watchdog groups say hospitals need this kind of pressure to fix the industry’s poor track record of billing schemes, which Bob reported on previously.

The world’s richest doctor is the new owner of the L.A. Times

Soon-Shiong speaking at Cancer MoonShot 2020 in October 2016. Photo: Darren McCollester / Getty Images for NantHealth, Inc.

The Washington Post reports billionaire doctor Patrick Soon-Shiong is buying two newspapers, the Los Angeles Times and the San Diego Union-Tribune. Yes, that’s the same billionaire doctor Patrick Soon-Shiong who:

  • Hyped a quest to cure cancer but has made little actual progress, according to STAT.
  • Allegedly engaged in self-dealing by routing philanthropic donations to his own health care companies, per STAT and Politico.
  • Created an $11,000 diagnostic test but hasn’t found a lot of buyers, according to Bloomberg.
  • Bought a big stake in a hospital system, raising questions of whether the system would be a gateway for his tests and treatments, which Bob covered last year.
  • Isn’t a fan of media coverage that critiques his businesses.
Caitlin Owens

What we're watching today: The Senate and the spending bill. HELP Committee hearing on the opioid crisis.

Thanks for all your suggestions for a new, shorter way to refer to the health care company launched by Amazon, Berkshire Hathaway and JPMorgan Chase. By far the most common submission was ABC (for Amazon, Berkshire, Chase). That's boring. I'm sticking with JP Berkshamazon.

Don't like it? You can yell at me via baker@axios.com.