May 2, 2018

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning ... Sometimes, home DNA kits help catch suspected serial killers. Other times, they can't tell a dog from a human and inform the dog that it would be a good basketball player.

1 big thing: The rush for seniors' health dollars

Illustration: Sarah Grillo/Axios

Health care companies are rushing to buy or invest in areas that focus on the elderly population, as baby boomers are reaching an age where they require more health care services, Bob Herman reports this morning.

The big picture: More of the nation's health care spending is going toward government programs, especially Medicare and Medicaid, so the industry is naturally running to where the dollars will be. But that doesn't guarantee seniors will get better care.

Driving the news: Companies are investing in seniors in a few ways, many of which involve home health, assisted living, nursing homes, hospices and drugs.

  • Some of the biggest industry mergers prioritize the prescription drug market of people 65 years and older — a demographic where more than 9 out of 10 have taken at least one prescription drug in the past month.
  • Other deals — like Humana's acquisitions of Kindred Healthcare and Curo Health Services, or ProMedica's buyout of bankrupt senior living care provider HCR ManorCare — are aimed at tracking older people once they leave the hospital so they avoid setbacks and stay in the comfort of their homes.

Go deeper: Bob has more at

2. Verma: “Dual purpose” in work requirements

Seema Verma. Photo: Alex Wong/Getty Images

“Our programs have to have a dual purpose — they have to address the immediate needs at hand but they also have to be a bridge” out of poverty, Seema Verma, Centers for Medicare & Medicaid Services administrator, told reporters yesterday.

Why it matters: Under Verma’s leadership, CMS has been approving states’ requests to add work requirements to their Medicaid program.

  • Those policies are already being challenged in court, on the grounds that they don’t further the Medicaid program’s stated goals (providing health insurance to low-income people).
  • So, how CMS frames work requirements as an extension of Medicaid’s mission will matter in court. And Verma’s comments yesterday were consistent with the framework CMS has laid out in its formal decision-making, knowing that legal clash is coming.

Where it stands: Twelve states have submitted requests to add work requirements to their Medicaid programs. Verma said she’s working with states to help them write more thorough requests that CMS can approve more quickly, without much back-and-forth.

  • “They need to make the case that it is adhering to the objectives of the Medicaid program,” she said.

Intrigue: This press availability was initially planned so that Verma could reject Kansas' request to impose lifetime limits on Medicaid coverage, but that announcement was scrapped at the last minute due to internal disagreements, The Hill reports.

3. Price vs. Price
“Well, the individual mandate is one of those things that actually is driving up the costs for the American people in terms of coverage.”
— Tom Price, on ABC’s “This Week,” July 30, 2017
“And there are many, and I’m one of them, who believes that that actually will harm the pool in the exchange market, because you’ll likely have individuals who are younger and healthier not participating in that market, and consequently, that drives up the cost for other folks within that market.”
— Tom Price on individual mandate repeal at the World Health Care Congress yesterday, per Washington Times
4. The latest earnings buzz

Wall Street has been buzzing about health care earnings. Bob gathered some highlights from this very busy week thus far.

  • HCA: President Sam Hazen told investors the brutal flu season “had a positive impact” (although those who got the illness may beg to differ). Half of HCA’s growth in ER visits in Q1 was flu-related. Profit almost doubled to $1.1 billion.
  • Tenet: Ditto HCA’s sentiment about the flu, giving the troubled company a $99 million quarterly profit.
  • Aetna: 57% of the health insurer’s revenue came from government sources, Medicare remaining the main chunk. Q1 profit eclipsed $1.2 billion.
  • Pfizer: Wall Street nearly went into cardiac arrest after hearing CEO Ian Read say the pharma giant isn’t pursuing a megamerger and instead is focusing on developing its own drugs. But Pfizer still increased quarterly profit by 14% to $3.6 billion. Thanks, price hikes!
  • Gilead: Gilead’s sales and profit both declined because AbbVie is eating into its hepatitis C kingdom. But even though Wall Street sold off the stock after trading hours, Gilead still registered a 30% profit margin in Q1.

Don’t forget to follow our spreadsheet for other earnings.

5. My loneliness is killing me

Loneliness is as bad for our long-term health as smoking, and we're pretty lonely, according to a new survey from Cigna.

By the numbers: In Cigna's survey of 20,000 American adults ...

  • 43% said they always or sometimes lack companionship.
  • 27% rarely or never "feel as though there are people who really understand them."
  • 19% don't feel there are people they can turn to.

The impact: Among people who said they never have in-person interactions, 50% are in fair or poor overall health, compared with just 12% of those who have daily in-person interactions.

Caitlin Owens

What we're watching today: HHS secretary Alex Azar speaks at the World Health Care Congress at 7:35 am.

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