Sep 23, 2019

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning. People do weird things (h/t Sam Baker's Twitter feed).

Today's word count is 952, or 3 minutes.

1 big thing: Bernie Sanders' plan to eliminate medical debt

Illustration: Sarah Grillo/Axios

The senator and 2020 candidate this weekend released his plan to cancel $81 billion in existing medical debt, reform collections practices and change bankruptcy rules.

Why it matters: The proposal speaks directly to the issues of surprise medical bills and hospitals' lawsuits against patients — issues that have only recently entered the political lexicon.

  • It also, of course, is a simple solution to the problem of unaffordable health care costs, a top issue for voters and one that has only become more prominent with the rise of deductibles and other forms of cost-sharing.

On the other hand, it's not hard at all to imagine how this will play with those who already think Sanders has made ludicrous financial proposals.

Between the lines: Sanders would have the federal government "negotiate and pay off past-due medical bills in collections that have been reported to credit agencies," per the plan.

  • But medical debt often doesn't get paid, so collectors will sell it for cheap. Craig Antico, founder of the nonprofit charity R.I.P. Medical Debt — which buys and absolves health care debt in bulk — told NYT that the market price for $81 billion in debt could be as low as $500 million.

What Sanders wants to do, per Axios' Orion Rummler:

  • Have the IRS review billing and collection practices of nonprofit hospitals.
  • Replace for-profit credit reporting agencies with a "secure public credit registry."
  • Stop requiring the disclosure of medical debt discharge on housing and loan applications.

What we're watching: Sanders' embrace of "Medicare for All" has transformed the Democratic party, pulling it much further left on health care. It's unclear if his stance on medical debt will play the same way, and how the rest of the 2020 field will respond.

Go deeper: Hospital lawsuits unearth "cracks in our system"

2. What to watch on drug prices

Illustration: Sarah Grillo/Axios

House Speaker Nancy Pelosi's release of her drug pricing plan last week means that both chambers of Congress are officially working to pass drug pricing legislation, with the White House closely monitoring.

  • The House Energy and Commerce Committee will hold the first hearing on the bill on Wednesday.

Between the lines: There's a lot of overlap between the two chambers' bills, with the biggest difference being that Pelosi's includes aggressive Medicare price negotiations.

  • But for the time being, each chamber is moving ahead on their own version. Pelosi's was met with some trepidation by progressives, while Sen. Chuck Grassley has his work cut out to convince some of his Republican colleagues to support his bill.
  • There's also a push to combine drug prices with legislation addressing surprise medical bills and overall health costs, which is its own political battle.

The big picture: If both chambers can pass anything — a relatively big if — it's anyone's guess how that happens or how the two versions are reconciled.

  • The administration wants Congress to work it out in a conference committee, a senior administration official told me, and it's remained quiet about the details of Pelosi's bill.
  • "We dig some parts of it, hate other pieces of it, can work through it all in conference, and are pumped that [Pelosi]’s finally in the game," the official said.  

The bottom line: The White House is still the ultimate wild card.

3. GOP allies warn of vaping ban's 2020 effect

Illustration: Lazaro Gamio/Axios

Conservative leaders are circulating data to White House staff that claims adults who vape will turn on President Trump if he follows through with his planned ban on flavored e-cigarettes, Axios' Alayna Treene reports.

Between the lines: The data reveals that the number of adult vapers in key battleground states greatly outweighs the margins by which Trump won those states in 2016 — and they argue it could cost him reelection.

  • "While parents may be concerned about e-cigarettes, the people who genuinely care about vaping as a voting issue so far outweighs the number of people Trump needs to win in 2020 that they are royally screwing themselves by doing this," said Paul Blair, the director of strategic initiatives at Americans for Tax Reform.

Alayna's thought bubble: There are 4 unsubstantiated assumptions about adult vapers in the case being presented to Trump:

  1. They start out as Trump voters.
  2. They wouldn't vape anymore if they couldn't get the flavors.
  3. They are single-issue voters around vaping rights.
  4. The eventual Democratic nominee would be more vape-friendly.

Still, the math can't be totally ignored, especially in places like Michigan, Pennsylvania and Wisconsin where Trump's 2016 win margins were so narrow and the number of adult vapers is relatively high.

1 fun detail: Trump's 2020 campaign manager Brad Parscale hit back at a Trump follower who tweeted that banning vaping products is "not on brand with MAGA."

Go deeper.

4. The surgery center gold rush

The number of procedures taking place in outpatient surgery centers — where people go under the knife and return home the same day — is expected to rise from 23 million in 2018 to 27 million in 2021, according to estimates from consulting firm Bain & Co.

Why it matters: Surgeries in freestanding centers cost less than those that happen in hospital outpatient departments, which is why many insurers and policymakers are pushing for this shift, Axios' Bob Herman reports.

  • But that doesn't mean it's an unprofitable niche. Surgery centers would generate $43 billion worth of procedures if those estimates hold up.

Between the lines: Medicare has made it clear it will pay for more surgeries, especially orthopedic procedures like joint replacements, outside of the hospital. Industry giants have been placing their bets on these facilities for years.

  • Health insurers: UnitedHealth Group bought Surgical Care Affiliates for $2.3 billion in 2017.
  • Hospitals: Tenet Healthcare and HCA Healthcare each own more than 120 surgery centers, and many not-for-profit hospitals own stakes in their local surgery centers.
  • Private equity firms: Bain Capital, the PE arm that was spun out of Bain & Co., owns two-thirds of Surgery Partners, a surgery center chain that's on pace to collect $1.7 billion of revenue this year.

Go deeper: Health care sees dollar signs in surgery centers

5. While you were weekending...
  • Maine is close to adding a ballot question to ask voters "to overturn a state law eliminating nonmedical vaccine exemptions for school children," a result of the anti-vaxxer movement's efforts, the Wall Street Journal reports.
  • Relatedly, the L.A. Times digs into California's battle over its new vaccine law.
  • The New Yorker profiles a surgeon who has performed about 3,000 procedures with the help of a robot.
  • The Washington Post investigates Congress's failure to address fentanyl as the overdose death rate surged.
Caitlin Owens