Oct 14, 2020

Axios Vitals

Good morning.

Today's word count is 1,234, or a 5-minute read.

1 big thing: GOP's Supreme Court message: Don't worry about the ACA

Photo: Jim Lo Scalzo-Pool/Getty Images

Health care was by far the dominant issue in the Senate Judiciary Committee's confirmation hearing yesterday for Judge Amy Coney Barrett, Axios' Sam Baker reports.

The big picture: After promising for 10 years to get rid of the Affordable Care Act, and with a lawsuit pending at the Supreme Court that could do exactly that, Republicans are making a new argument: C'mon, nobody's getting rid of the Affordable Care Act.

  • "I'm not here on a mission to destroy the Affordable Care Act," Barrett said yesterday.
  • She has criticized the Supreme Court's previous decisions upholding the ACA, but was quick to emphasize the difference between those cases and the one she might hear. She refused to entertain hypotheticals about how she might rule.

Between the lines: The ACA is on the chopping block yet again at the Supreme Court.

  • But with Barrett on an apparent fast track to confirmation, Democrats' litany of personal stories — especially when they were coming from vice presidential candidate Kamala Harris — sounded like more of a 2020 campaign message than a legal argument.
  • So did Republicans' sudden insistence that their party's efforts to kill the ACA are not going to succeed.

Reality check: Republican attorneys general and the Trump administration are asking the Supreme Court to strike down the entire law, and will make that case in oral arguments on Nov. 10.

  • As Barrett explained several times, the issue in this case is whether the individual mandate has become unconstitutional, and then, if so, how much of the rest of the law is "severable" from the mandate.

But any time the Justice Department takes a position before the Supreme Court, that position is worth taking seriously. And in this case the Justice Department is telling the court to strike down the whole law, including its protections for people with pre-existing conditions.

2. Black Americans skeptical of a coronavirus vaccine
Data: KFF; Chart: Axios Visuals

Strikingly large shares of Black Americans say they would be reluctant to get a coronavirus vaccine — even if it was free and had been deemed safe by scientists, according to a new nationwide survey from the Kaiser Family Foundation and The Undefeated.

Why it matters: The findings reflect well-founded distrust of government and health care institutions, and they underscore the need for credible outreach efforts when a vaccine is distributed, KFF's Drew Altman writes in today's column.

  • Otherwise, distribution could fail to effectively reach the Black community, which has been disproportionately affected by coronavirus.

By the numbers: Just 17% of Black American adults say they definitely will get a COVID-19 vaccine if it were determined to be safe by scientists and it was free; 49% said they would not get it.

  • Large shares are skeptical even among people at the highest risk. Just 20% of Black people with a serious health condition say they definitely would get a safe, free vaccine, as did 24% of those who have a health care worker in the home and 25% of Black seniors.

Between the lines: Vaccine hesitancy in the Black community is rooted in experiences with discrimination and systemic racism.

The bottom line: A vaccine distribution effort that is not coupled with a credible outreach effort in communities of color is likely to fall far short of reaching many of the people who are most at risk.

3. The pandemic isn't hurting the health industry

Health care's third-quarter earnings season has started, and if the quarter is anything like the previous one, the industry will continue to fare relatively well even amid the broader economic turmoil, Axios' Bob Herman writes.

Driving the news: The coronavirus dominated the spring and summer, which forced people to put off care, but people have resumed getting procedures and seeing their doctors.

Between the lines: The second quarter was extremely profitable for health insurers — UnitedHealth Group, for example, posted its highest-ever profit.

  • Health insurers still aren't paying as many medical claims as before the pandemic, which likely will keep their profit figures at high levels.

Yes, but: The persistent amount of coronavirus cases is no longer stunting all demand for pharmaceuticals, surgeries, medical devices, hospital stays, doctor visits and other health care services.

  • The highest net profit margins in Q2 belonged to pharmaceutical companies and hospitals, according to the Axios health care earnings tracker.
  • Almost all hospital systems we track posted a net profit in Q2, due largely to the rebounding stock market boosting their investment portfolios. But patient volumes have also continued to increase since their low point in the spring.
  • Hospital executives "expect a sharp recovery [in volumes] over the next twelve months," according to a new SVB Leerink survey.
  • Medical device sales are "recovering faster than expected," Johnson & Johnson executives said on their Q3 investor call yesterday.

Go deeper: Follow our earnings tracker

4. Private equity-owned air ambulances charge more
Adapted from Brookings; Chart: Axios Visuals

Air ambulances owned by private equity firms charge the highest rates — more than seven times what Medicare pays, according to a new analysis by the USC-Brookings Schaeffer Initiative for Health Policy.

Why it matters: Air ambulances are frequent sources of surprise medical bills, and even when they're covered by insurance, we all pay for these expensive prices through our premiums.

  • 40% of helicopter ambulance rides result in a surprise medical bill, which averages around $20,000, according to a recent study.

By the numbers: In 2017, helicopter air ambulances owned by two private equity firms charged, on average, $48,250 — or 7.2 times the Medicare rate.

  • Air ambulances that weren't owned by private equity firms or publicly traded companies charged $28,800 on average — which is still 4.3 times higher than the Medicare rate.
  • Private equity carrier charges have also grown faster than the charges of other air ambulances, and by 2017, private equity controlled nearly two-thirds of the national Medicare air ambulance markets.

How it works: Charges aren't what insurers actually pay. But they serve as a starting point for price negotiations, and providers often bill patients for the difference between the charge and what the insurer agrees to pay.

The other side: Air ambulances argue that they must charge privately insured patients more to make up for low government payment rates, and for trips they never get reimbursed for.

5. No Trump drug discount cards before the election

The $200 prescription drug discount cards the Trump administration promised to Medicare recipients won't likely reach households by the Nov. 3 goal, the Wall Street Journal reports.

Why it matters: The cards, which Trump announced in late September with little detail, target voters over 65, a group that is crucial to the president's reelection bid, Axios' Marisa Fernandez writes.

  • The administration could only push through a small percentage of cards by October, so most will likely reach users after Election Day.
  • It's still uncertain whether the federal government can legally send out the cards.

By the numbers: If approved by the Office for Management and Budget, it could cost up to $8 billion.

  • The Centers for Medicare & Medicaid Services is spending an estimated $20 million for administrative costs to print and send letters to Medicare beneficiaries informing them that they will be getting cards, per WSJ.
6. Catch up quick

Illustration: Aïda Amer/Axios

Facebook will ban anti-vaccine ads in an effort to combat misinformation and support public health experts, the social media platform announced in a statement on Tuesday.

Senate Majority Leader Mitch McConnell (R-Ky.) issued a statement on Tuesday saying that the Senate's "first order of business" when it returns on Oct. 19 will be to vote on "targeted relief for American workers," including new funding for the small business Paycheck Protection Program (PPP).

Johnson & Johnson has paused Phase 3 trials for its COVID-19 vaccine candidate, after one patient reported an "unexplained illness." Axios Re:Cap goes deeper with Tom Frieden, who led the Centers for Disease Control and Prevention between 2009 and 2017.

President Trump blasted Anthony Fauci's coronavirus response in a Tuesday tweet, saying that the doctor's "pitching arm is far more accurate than his prognostications."

Editor's note: The chart in the first item in yesterday's Vitals was corrected to show the deaths are per 100,000 people (not deaths per one million people).