Jul 12, 2017

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning ... That sound you hear is every health care reporter in Washington on the phone with the suicide hotline, now that Senate Majority Leader Mitch McConnell delayed the August recess.

Quick note: Please join Axios and NBC News tomorrow at 8 a.m. in downtown D.C to discuss the economy in 2017. "Meet the Press" moderator Chuck Todd and Axios founder and CEO Jim VandeHei will host one-on-one conversations with Sen. Debbie Stabenow of Michigan and Rep. Jeb Hensarling of Texas. Doors open at 7:30 a.m. RSVP here.

Still waiting for that health care game changer

What did Senate Majority Leader Mitch McConnell get for the extra two weeks of work on the Senate health care bill? A revised bill, to be released Thursday morning, that's likely to leave Senate Republicans in about the same place they were before: divided and stuck.

And then they'll vote next week — or maybe they won't, if they can't approve the procedural motion to take up the bill. That's a real possibility, if there are no game changers between now and then. And you know what McConnell doesn't have right now? A game changer.

Here's where the health care effort stands:

  • The bill as described to Senate Republicans yesterday doesn't sound that different from the one they had before, Caitlin Owens reports. The Medicaid spending limits, in particular, are likely to be unchanged — a blow to moderate Republicans who thought the bill would squeeze the program too hard.
  • One change that might appeal to the moderates: The bill will drop plans to repeal two ACA taxes on high earners. Bloomberg reports that the new bill will keep the law's 3.8% tax on net investment income and a 0.9% Medicare tax, both aimed at wealthy people.
  • It's not clear that the conservatives will get much, either. There's no decision on whether to include a proposal by Sens. Ted Cruz and Mike Lee to let insurers sell some health plans that don't comply with all of the Affordable Care Act rules, as long as they also sell plans that do.
  • The fate of that proposal may depend on the Senate parliamentarian, who's deciding this week what ACA rewrites are allowed under Senate budget rules. If the Cruz proposal doesn't comply with the budget rules, it can't be part of the bill, and it would need 60 votes to pass — which it wouldn't get.

If the bill doesn't pass: Don't write off the possibility that the Senate could follow up with a repeal-only vote. Jonathan Swan reports that Senate GOP leaders are leaving that door open, and White House officials are urging them to take that vote. And they're ready to twist the arms of any moderates who voted for full repeal in 2015 but wouldn't do so now.

Between the lines: In laying out the schedule to reporters yesterday, McConnell talked about the release of the bill on Thursday, a CBO score at the beginning of next week, and then a vote on the motion to take up the bill. The part he didn't say: "And then we'll vote on the bill and pass it."

Know what the public wants? A bipartisan repair mission

So, about McConnell's threat to make Republicans work with Democrats if they can't pass repeal: The public would be OK with that. That's the message of a new Kaiser Family Foundation poll that Drew Altman previews in today's column:

  • Seven out of 10 Americans, including most Democrats and independents, want the two parties to work together to improve the ACA.
  • Even President Trump's supporters are evenly split.
  • It's mostly the broader group of Republicans who want to keep working on repeal.

The bottom line: That doesn't make it any easier for Republicans to ignore pressure from the base, or from conservative groups, to try every possible route to repeal the ACA. But it does mean a bipartisan repair mission could be less painful than they think.

Redistributing the redistribution

The ACA raised taxes on wealthy people and diverted the money into health care benefits for lower-income people. A new analysis from the Urban Institute shows just how dramatically the Senate health care bill, or the Better Care Reconciliation Act of 2017, would reverse that redistribution.

The figures above represent Urban's best guess at the overall changes the Senate bill would affect in household income — accounting not just for its overhaul of the ACA's taxes and subsidies, but also changes in benefits.

Key caveat: The discrepancies here might flatten out somewhat after Republicans release the next version of their bill, which likely won't give wealthy families as big a tax cut as the initial version. But the bill's Medicaid cuts would still leave a deep dent in many poor families' pocketbooks.

What a $30 million rebranding buys you

HealthSouth is going to shell out upwards of $30 million to change its corporate name to Encompass Health, Bob Herman reports. HealthSouth, which operates home health agencies, inpatient rehab hospitals, and outpatient rehab centers, also will switch its stock ticker symbol to EHC.

Behind the change: HealthSouth CEO Mark Tarr gave a long, winding explanation about the name change in a statement. But he didn't mention the rebranding would wipe away the stained HealthSouth name, which was associated with the massive accounting fraud scam orchestrated by former CEO and founder Richard Scrushy in the early 2000s. Scrushy later was sent to prison for a separate bribery scheme and had to pay off billions of dollars in damages to HealthSouth.

It's a bird! It's a plane! It's a bipartisan idea on health care!

Two former CMS administrators — one Republican and one Democrat — have a joint message for Senate Republicans: Put these massive Medicaid cuts on ice for a while, focus on stabilizing the individual insurance market, and then figure out what you really want to do with Medicaid.

"Changes to the individual market alone have a greater chance of receiving bipartisan support while substantive work on Medicaid is under way," Andy Slavitt and Gail Wilensky, who led the federal Medicaid agency under Presidents Barack Obama and George H.W. Bush, respectively, wrote in an op-ed on the JAMA website.

Reality check: Slavitt and Wilensky are probably right about the kinds of reforms that could garner bipartisan support. But the only way to get there might be for the current Senate bill to fail. Republicans have shown no signs of scaling back the Medicaid cuts that form the core of this bill.

Caitlin Owens

What we're watching today: Vice President Mike Pence talks health care in Lexington, Kentucky. House votes on reauthorization of Food and Drug Administration user fees.

Also, House Energy and Commerce health subcommittee hearing on medical product manufacturer communications, 10:15 a.m. Eastern. Livestream here. Employee Benefit Research Institute health policy forum, focusing on health savings accounts, 9:30 a.m. Eastern. Livestream here.

What we're watching this week: New-ish Senate health care bill, Thursday. Also, House Ways and Means Committee marks up bipartisan bills to update Medicare Part B and reauthorize the Medicare Special Needs Plans program, Thursday.

What we're watching next week: Will the Senate even take up the health care bill? Also, UnitedHealth Group and Johnson & Johnson kick off second-quarter earnings season, Tuesday, July 18. House Energy and Commerce oversight subcommittee hearing on the 340B drug discount program, Tuesday, July 18.

What else is going on? Send your tips and feedback to david@axios.com and baker@axios.com. (Also, if you have a spare seat on Pence's flight to the beautiful rolling hills of the Bluegrass, home to the finest distilleries in the world and the winningest college basketball team of all time, definitely email baker@axios.com.)