Nov 6, 2017

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning ... Philly readers: Former Vice President Joe Biden and Dr. Jill Biden, along with Sean Parker, are joining our Mike Allen Wednesday to discuss the future of cancer care, and you're invited. Mike will also explore this topic with Celgene Corporation CEO Mark Alles, cancer survivor and advocate Stefanie Joho, and Dr. Elizabeth Jaffee, deputy director of the Kimmel Cancer Center at Johns Hopkins. RSVP here.

The irony in Trump's roundabout bump for ACA subsidies

Democrats have wanted for years to expand the Affordable Care Act's premium subsidies. But it took President Trump — and a desire to harm the law — to actually make it happen, as my colleague Caitlin Owens notes this morning.

Trump's decision to end the law's cost-sharing reduction payments prompted insurers to raise their premiums, which in turn raised premium subsidies. That's bad news for the millions of unsubsidized consumers, but good news for the millions of lower-income enrollees who can now find a range of plans with a $0 monthly premium.

Flashback: The irony of all this is that Democrats — including Hillary Clinton — have consistently pushed for increased premium subsidies, albeit in a much more straightforward way. (And of course they also want the government to continue the payments Trump cut off.)

  • Congressional Republicans would never have agreed to create more "free" insurance plans on the government's dime. Their repeal-and-replace bills would have substantially reduced the law's premium subsidies.
  • "The R's are driving in reverse relative to their repeal dream," Democratic health care strategist Chris Jennings told Caitlin.

Yes, but: "We could spend that extra money we are shelling out today to pay for the excess premiums far more efficiently and get more people covered more affordably," Jennings said.

​CMS takes a step back from the RUC

My colleague Bob Herman reports that the Centers for Medicare & Medicaid Services responded to critics in its final physician payment rule for 2018 by saying the agency is "not relinquishing our obligation to independently establish" physician payment rates. CMS previously said it would rely almost entirely on a secretive panel of doctors convened by the American Medical Association to determine Medicare payments.

The bottom line: CMS clearly wanted to address the "concern and disappointment" of the health policy community, according to the rule, and said it will consult with other independent sources outside of the AMA's Relative Value Scale Update Committee, or RUC.

Yes, but: The RUC, a group with little public oversight that is tilted toward specialty physicians, is expected to still wield substantial influence over how Medicare rates are developed.

Medicaid is big business for California insurers

Medicaid insurers in California made more than $5 billion in profits from 2014 to 2016 — and more than all Medicaid insurers combined in 34 other states last year, the Los Angeles Times reports.

  • California's windfall stemmed largely from a payment bump in the early years of ACA enrollment.
  • The state thought sick patients would flood into the system, so they increased payments to Medicaid managed-care plans. But new enrollees' claims weren't as high as expected, so insurers were able to keep a lot of that money.
  • "California is being wildly open handed and excessively generous with insurers," Boston University health analyst Alan Sager told the newspaper.

Be smart: Most of the country now relies on private insurers to administer Medicaid coverage. Insurers in other states may not see the same outsized profits they've seen in California, but this is nevertheless a big line of business for the industry overall.

​Dems look for "health care voters"

My colleague Alexi McCammond has a first look this morning at a new Democratic effort to register and mobilize 1 million "health care voters" ahead of next year's midterms. The yearlong, "must-million dollar" campaign is being sponsored by the Health Care Voter campaign, a coalition of more than 30 progressive organizations formed this summer to turn the 2018 midterms into a referendum on health care.

Why it matters: The campaign is starting one year from the midterms as a way to encourage voter turnout among Democrats, keep health care as a top voting issue, and to target Republicans on their repeal-and-replace efforts. The group's main challenge: Democratic turnout tends to drop during midterms, and they'll only succeed if they can buck the trend.

​While you were weekending…
  • Repealing the ACA's individual mandate as part of tax reform is still on the table, House Speaker Paul Ryan said on "Fox News Sunday."
  • Hepatitis A outbreaks keep coming, and local governments don't have access to enough vaccines to stop those outbreaks, the Huffington Post reports.
  • The U.S. is blocking any mention of universal health care or reproductive health in a joint statement from the G7 nations' health ministers, according to BuzzFeed.
  • CBS Los Angeles looks at some of the non-traditional routes people are taking to get health care, as they face rising premiums and deductibles.
Caitlin Owens

What we're watching today: National Press Club lunch with Veterans Affairs administrator David Shulkin (12:30pm ET, details here).

What we're watching this week: House Energy and Commerce health subcommittee hearing Wednesday on "MACRA and Alternative Payment Models: Developing Options for Value-based Care."

Get in touch: I welcome your tips, comments and questions: baker@axios.com.