May 18, 2018

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning ... In videos obtained and released by MSNBC, Bill Gates says President Trump asked him on two separate occasions whether vaccines are safe (yes) and whether HIV and HPV are the same thing (no).

1 big thing: Health care industry awash in cash
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Data: Axios analysis of company financial documents. Get the data; Chart: Andrew Witherspoon/Axios

The health care industry recorded an immensely profitable first quarter, according to my colleague Bob Herman's analysis of financial documents for 108 companies. Year-over-year earnings among the 10 biggest health care corporations rose by 8.4%.

The details:

  • More than half of the industry's earnings came from 10 companies.
  • All 10 of those companies that reaped the largest earnings are either pharmaceutical firms or are involved with the drug supply chain.
  • Drug maker Amgen's 41.6% profit margin was the highest among all companies in Q1.

The big picture: The 108 companies cumulatively boosted Q1 global revenues by 6.3% to $558 billion — an amount from just one quarter that is about the size of Sweden's economy.

  • Their collective profits actually decreased 0.8% to $44.7 billion, but if a few one-off elements from 2017 were eliminated, profits would have increased.

Why it matters: Higher profits and revenues naturally mean U.S. health care spending is increasing.

Go deeper

2. Planned Parenthood cuts coming

Situational awareness, via Modern Healthcare: "HHS plans to announce forthcoming regulations on Friday that would ban Title X family planning providers from referring patients to abortion clinics and prohibit funding for Planned Parenthood."

What to watch: The Trump administration has already been sued over these changes, even before it has actually made them.

3. Analysis: GOP raising average ACA premiums by $1,000

The repeal of the Affordable Care Act's individual mandate, combined with the Trump administration's rules expanding access to short-term insurance plans, will raise the average ACA plan's premiums by about $1,000, according to an analysis that the liberal Center for American Progress plans to release today.

The numbers: CAP based its math on the rates for a "benchmark" plan in each state, combined with the Urban Institute's estimates of projected premium increases for the next plan year.

  • The ACA defines a "benchmark" plan — it's the one used to calculate people's premium subsidies.
  • Nationwide, the average annual premium for a 40-year-old would be just shy of $7,200 next year, CAP said. It attributes about $1,000 — or 16% — of that cost to the loss of the mandate and the expansion of short-term plans.
  • State-by-state, the share of projected premiums attributed to those policies range from $0 (in Massachusetts, which has its own individual mandate) to more than $2,000 in Nebraska and Wyoming (largely rural states where health care tends to be more expensive in the first place).

Between the lines: Most ACA enrollees receive subsidies that help cover the cost of their premiums. But consumers who don't get those subsidies are increasingly being priced out of this already expensive market altogether.

  • Short-term plans offer an alternative for people who don't need much health care, but their tight limits and relatively sparse coverage make them less attractive to people who need the more comprehensive coverage ACA plans provide.

Go deeper: See the state-by-state breakdown.

4. Ebola outbreak in Congo has spread to a city

Congo's Ebola outbreak has spread to a big city — Mbandaka, which has a population of more than 1 million — the Washington Post reports.

  • Previous cases had largely been confined to rural areas more than 100 miles away from Mbandaka.
  • The total number of suspected cases is now at 45, including 25 deaths.

Why it maters: Because Ebola is relatively easy to spread, even one case in a more densely populated area sets off more alarm bells.

  • "The potential for an explosive increase in cases is now there," Peter Salama, the World Health Organization's deputy director general of emergency preparedness and response, told the Post.
Caitlin Owens

Have a great weekend, and don't forget to share your best tips before you clock out: baker@axios.com.