Jul 16, 2018

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning … D.C. readers — On Tuesday, join Axios' Mike Allen in kicking off the Axios360 Hometown Tour. He'll be discussing how trade and Washington's economic policies are impacting communities with Agriculture Secretary Sonny Perdue, House Agriculture Chair Mike Conaway, former U.S. Trade Representative Ron Kirk and Chattanooga Mayor Andy Berke. RSVP here.

Mike's tour continues this summer and fall with stops in Savannah, Denver and Los Angeles. Stay in the loop.

1 big thing: Defining "Medicare for All"

Let’s jump into the debate Democrats are going to be having for at least the next two years: What, exactly, constitutes “Medicare for All”?

Why it matters: Supporting some version of “Medicare for All” has become a litmus test for a lot of Democratic primaries in 2018, and will surely be one in 2020.

What they’re saying: Tim Higginbotham and Chris Middleman, organizers with the Democratic Socialists of America’s Medicare for All campaign, pushed back against the squishier definitions of the term in a Vox op-ed on Friday.

  • “We need a true single-payer system, not a patchwork … effectively abolishing the private health insurance industry altogether.”
  • That single program should cover everyone, should provide services like mental and dental health, and should be free at the point of service (no co-pays or deductibles), they said.

The other side: Try writing, for example, a health policy newsletter that treats “Medicare for All” and “single-payer” as synonyms, and you’ll hear from the Democrats who support a less sweeping program, like an optional Medicare buy-in.

  • Medicare, they accurately note, relies heavily on private insurance. Why should “Medicare for All” have to mean pure single-payer when that’s not what Medicare is today?

My thought bubble: Hardly anyone is actually talking about a literal expansion of the existing Medicare program, whether voluntary or compulsory.

  • Medicare today doesn't meet the definition DSA has laid out. Neither does Canada's single-payer system, for that matter. Medicare also doesn't cover things like maternity care, which more center-left proposals would change.
  • If this ever gets resolved, it will be during the 2020 primary at the earliest — not in 2018, when a raft of Democratic candidates across the center-left spectrum truly are benefitting from the term’s vague popularity.
2. China's tech sector eyeing pharmacies

Illustration: Sarah Grillo/Axios

The multi-hundred-billion-dollar retail prescription drugs market is the new battleground for Big Tech — in both the U.S. and China, my colleague Erica Pandey reports.

The bottom line: "There's just too much money to be made," says Sophie Cairns, a pharmaceutical analyst at IHS Markit, speaking of China's massive population and a growing demand for drugs that is forecast to surpass the U.S.

In China:

  • Alibaba's health care arm, AliHealth, is limited to selling over-the-counter pharmaceuticals because of a government ban decreed last year on online sale of prescription drugs.
  • But, but, but: There are questions about how serious the government is about the ban, and Cairns thinks retail of online prescription drugs will ultimately be permitted.

Go deeper.

3. Q2 earnings are nigh

Dust off your abacus, because second-quarter health care earnings roll out this week, beginning with UnitedHealth Group and Johnson & Johnson on Tuesday. (Walgreens, operating on an oddball fiscal year, already posted its financial metrics.) Axios' Bob Herman has you covered with his updated health care earnings spreadsheet.

What to expect: Industry surveys indicate people are not being hospitalized or going to their doctor as often as the past, which means the big health insurance companies likely will continue to post huge cash flows.

4. AHIP adds four new members

America's Health Insurance Plans, the insurance industry's leading trade group, is announcing four new members today:

  • CalOptima, which participates in Medicare Advantage and Medicaid in Orange County, Calif.
  • CareOregon
  • Health Plan of San Joaquin
  • Priority Health, in Michigan
5. While you were weekending ...
  • Novartis' arrangement with President Trump's former personal attorney Michael Cohen was more extensive than the company initially described, according to a report from Senate Democrats.
  • Pressure to control underlying health care costs is mounting, per the Health Affairs blog.
  • Medicare is exempting so many providers from new payment systems that it could complicate the broader push for "value-based" care, Modern Healthcare reports.
Caitlin Owens

What we're watching this week: Senate health committee continues its series of hearings on health care costs Tuesday.

Ways and Means hearings Tuesday on the Stark Law and value-based purchasing (background) and on Medicare fraud. Energy and Commerce subcommittee hearing Tuesday on price transparency.

Energy and Commerce hearing Thursday on mental health and the 21st Century Cures Act.

What'd I miss? Let me know: baker@axios.com.