Sep 27, 2019

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning. We made it.

Situational awareness: Kaiser Health News writes this morning that it's "suing the U.S. Centers for Medicare & Medicaid Services to release dozens of audits that the agency says reveal hundreds of millions of dollars in overcharges by Medicare Advantage health plans."

Today's word count is 1,008, or <4 minutes.

1 big thing: What impeachment means for a deal on drug prices

Illustration: Aïda Amer/Axios

Washington hasn't yet given up on the prospect of passing a drug pricing bill into law, even as House Democrats move ahead with impeaching President Trump.

Between the lines: Speaker Nancy Pelosi and Trump already have plenty of bad blood, and the impeachment process is another layer of chaos. But people following the debate say both parties have plenty to gain politically from acting on an issue so important to voters.

Where it stands: It was already unclear whether Pelosi, Trump and Senate Republicans would be able to strike a grand bargain in an election year.

  • "Democrats threw guns, drugs and everything else on their legislative agenda under the impeachment bus," one Senate Republican strategist said.

Yes, but: Aides, lobbyists and policy experts on both sides of the aisle said Congress and Trump could now feel pressure to show that they're still working on policy.

  • "Obviously there's the question of [Trump's] willingness to work with [House Democrats] but I’m not so sure he won’t still be open to policy wins," said Brendan Buck, who was an adviser to former House Speaker Paul Ryan.
  • "If it seems to the public they are ignoring this and other issues because of some political distraction or calculation, it will redound to their detriment," said Democratic consultant Chris Jennings.

What they're saying:

  • "We will still be working energetically to move ahead. Up to the Hill as to whether it can progress, or gridlocks on impeachment," a senior administration official said.
  • "It certainly doesn't diminish our enthusiasm to do something on prescription drug prices, and there's no reason it should diminish theirs," a senior Democratic aide said.
  • "When Clinton was being impeached the Republican Congress separately passed legislation that he wanted passed," a senior Senate GOP aide said. "It was called 'compartmentalization:' impeachment over here, doing your job over there."
2. Effects of California's surprise billing law

California's law prohibiting surprise billing has led to an increase in care delivered by in-network providers, according to a new analysis by the USC-Brookings Schaeffer on Health Policy initiative.

The big picture: The leading federal surprise billing solution is similar to the California bill in that it creates a benchmark payment rate for out-of-network care. Providers have lobbied fiercely against the approach.

  • But while provider groups have warned that such a policy would lead to doctor shortages and threaten patients' access to care, that's not borne out in the data, according to USC-Brookings.

By the numbers: There was a 17% decrease in the share of out-of-network services delivered by the affected provider specialties after the California law took effect.

  • Conversely, the share of in-network services increased from 79.1% to 82.6%.

Yes, but: What the approach likely does do is reduce providers' bargaining leverage with insurers, leading to lower overall payment rates.

  • As the NYT succinctly puts it, "Some doctors may be hurting from a pay cut, but that doesn't seem to be hurting patients."

Go deeper: We all pay for surprise emergency room bills

3. "Skin in the game" has backfired

The theory that putting patients on the hook for more of their health care costs would make them better consumers — thus driving down overall costs — hasn't panned out, the LA Times' Noam Levey writes in his latest piece in a series on deductibles.

Why it matters: Health care prices are still rising, and are largely untethered to quality. At the same time, care has become increasingly unaffordable for many Americans.

  • This, in turn, has driven today's political debates over drug prices, surprise medical bills and overall costs.

Between the lines: High deductibles hasn't led to the kind of shopping that would be necessary for the "skin in the game" theory to be successful.

  • That's because shopping is often impossible, either because the service isn't planned in advance or because providers and insurers don't always make prices available ahead of time.

What they're saying: "We overestimated the ability of consumers to be good stewards of their healthcare dollars in a system that is very unfriendly to consumers, and underestimated the support they would need from us," Marcus Thygeson, a former Blue Shield of California executive who worked on early efforts to develop "consumer-directed health plans," told the LAT.

My thought bubble: We've pointed it out before, but there's a strong irony to the fact that conservatives' darling policy idea has led to Americans being more willing than ever before to accept a single-payer health plan.

Go deeper: "Skin in the game" doesn't work

4. A pharma-PBM truce?

One of the big messages from the annual meeting of the Pharmaceutical Care Management Association, which represents pharmacy benefit managers, was how PBMs and pharmaceutical companies need to stop throwing dirt at each other, Axios' Bob Herman reports.

What they're saying: "The two industries now realize they are likely better off finding their own solutions, as opposed to letting the federal government find solutions for them," analysts with the investment bank Barclays, who attended the conference, wrote in a note to investors.

Between the lines: Pharma and PBMs have been publicly blaming each other as the culprits of high U.S. drug prices over the past few years. But the two sides used to live together symbiotically, since both benefit from higher list prices, and pending drug pricing legislation could spur the industries to call a truce.

Go deeper: Pharma companies hire drug middlemen, too

5. Medicaid programs embrace Uber and Lyft

More state Medicaid programs are making it easier for patients to use ride-sharing companies like Uber and Lyft as a nonemergency transportation benefit, Kaiser Health News reports.

Why it matters: More than 2 million Medicaid enrollees under 65 years old delayed their care in 2017 because they lacked transportation, per a federal survey, Axios' Marisa Fernandez writes.

  • Lyft has partnered with about 35 state Medicaid programs, while Uber began working with Medicaid in Arizona this summer.
  • Enrollees don't need a smartphone or the ride-sharing app and won't have to reserve the ride days ahead of time, like they often have to do when using traditional Medicaid transportation programs.

Yes but: Transportation doesn't alleviate all the factors that may cause a Medicaid patient to miss an appointment — like lack of child care, scheduling conflicts or long wait times.

  • Uber and Lyft may also not be ideal for people who need longer than the allotted five-minute wait time for pick up.

Go deeper: Uber wants to get you to your doctor appointment

Caitlin Owens