Aug 3, 2017

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning ... President Trump is still deciding what he wants to do about the Affordable Care Act's cost-sharing subsidies, keeping the entire health care world in a perpetual state of suspense. If there's one thing insurance companies hate, it's suspense.

On the bright side, the Senate might pass the bill to reauthorize the Food and Drug Administration's user fees today. They're expected to vote on the House-passed version so they don't have to negotiate a final version and they can just be done with it.

Blue states are ready to sue if Trump stops ACA subsidies

If Trump cuts off the payments to insurers for the ACA's cost-sharing reductions, the next step is sure to be a lawsuit by Democratic attorneys general. They just won a critical legal victory that will give them a much bigger role in the ongoing legal battle over those payments — and if Trump carries out his threat to stop the CSR payments, they say they're ready to respond.

"If the Trump administration attempts to stop paying these subsidies, we will challenge them in court," New York Attorney General Eric Schneiderman said yesterday. Politico reports that the decision is taking a while, in part because White House lawyers are working through all of this.

If Trump cuts off the subsidies:

  • Insurers would likely raise their premiums sharply and exit some markets altogether.
  • The first step for Democratic AGs, legal experts said, would probably be to seek an injunction — a court order forcing the administration to keep making the subsidy payments while the issue works its way through the courts.

Schneiderman said he didn't know yet whether Democrats would file a new lawsuit or pursue their challenge through the case that's already pending. He and his fellow Democratic AGs won the right earlier this week to participate in that case, which has been on ice since the election.

Why it matters: The uncertainty surrounding the CSR payments is one of the most immediate threats to a stable insurance market. Cutting them off would be highly disruptive. Keeping them in limbo from month to month, as the Trump administration has been doing, is still reasonably disruptive. A reignited legal battle, in which Democrats now have a bigger role, is a sword of Damocles that could swing in almost any direction.

There's only one clean, easy solution here — and that's for Congress to explicitly fund these subsidies. Watch those bipartisan Senate talks this fall.

How U.S. life expectancy compares to other countries

Every time we go through a health care debate, there's always a subtext: How do we compare to other countries around the world? Not just in the way we provide health care, which will always have to be unique to the United States — but how do we rate on the measures of people's health?

That's the question our Axios visuals team tackles this morning in a county-by-county look at life expectancy, and how it compares to the average life expectancy in other countries. It's an interactive graphic that lets you pick a country and see the comparison to different parts of the United States.

You can't do it here — this is just a gif — so explore the interactive version on the Axios health care news stream.

"Arizona was about to get screwed"

Sen. John McCain yesterday gave his first radio interview since voting against the Senate health care bill last week, effectively killing it. The Arizona senator seemed at peace with his decision, Caitlin Owens reports, and confident that a bipartisan committee process is the best path forward.

Some choice quotes:

On the Senate's replacement plan: "Arizona was about to get screwed."On what's next: "[Sens.] Lamar Alexander...and Patty Murray have announced they're going to start hearings. That's the way we should operate."On the ACA in Arizona: "It is imploding in Arizona...so we have to fix it, but we have to fix it in the right way."On the ACA in general: "Obamacare was based on the flawed premises that you would take money from healthy young people and pay for not so healthy older people. That premise was wrong...we need to fix it. We can fix it."On Democrats: "They have been obstructionist, but they have not been allowed input into the process."What he didn't say: That Republicans should try again to single-handedly reform the health care system. This interview further confirms that as long as Sens. McCain, Susan Collins, and Lisa Murkowski are in office, a GOP-only plan isn't happening.

Why you should care about congressional health subsidies

Trump is threatening to cut off a special subsidy that members of Congress and their aides get for ACA coverage, as we reported this weekend. "Big deal," you say — "Why should I worry about a bunch of Congress people who are probably rich anyway?"

Why? The real reason to pay attention is the aides. The subsidy is being attacked by conservative groups as a special deal for Congress, and Trump seems to agree. But the Obama administration set it up to act like the employer contribution most of us get for our health insurance — because the law requires members of Congress and their staffs to get their coverage through the ACA.

The bottom line: Think of it this way: It would be like your employer saying, "Sure we'll give you health insurance, but you have to pay the entire premiums yourself." You could keep working there, but the company across the street might do what most employers do with health insurance — pay for most of your premiums. How many of the most talented congressional staffers do you think will stick around?

What they're saying: Politico's Jen Haberkorn found that most Senate Republicans are blowing off Trump's threats, and got the unflappable Sen. Bob Corker to be, well, unflappable: "If that's what he wants to do, he ought to just do it."

Stryker’s newest board member is a health system customer

Medical device manufacturer Stryker added Mary Brainerd to its board of directors this week. But there's more to the story, Bob Herman reports. Brainerd is the retired CEO of HealthPartners, a large not-for-profit hospital and health insurance system in Minnesota — which also happened to buy $17 million worth of medical devices from Stryker between January 2016 through May 2017.

Why it matters: Many health care executives sit on the boards of different health care companies. That isn't problematic in a vacuum, but it could raise questions about conflicts of interest if executives' organizations do business with the companies where they hold board power. Stryker and HealthPartners didn't respond to requests for comment.

Read Bob's story to see other not-for-profit health care CEOs who hold cushy board seats at public health care companies.

Medicare unloads massive final rule for hospitals

Yesterday, the friendly folks over at the Centers for Medicare and Medicaid Services unleashed 2,456 pages of final 2018 payment rules and policies for hospitals. Bob spent a ton of time working his way through the document, so bear with him while his brain leaks out his ears.

In the meantime, Bob had some quick takeaways:

Medicare spending on inpatient hospital services is expected to go up by about $2.4 billion next year — down from the proposed $3.1 billion.A new system for calculating uncompensated care will go into effect, against the wishes of the hospital industry.Medicare has withdrawn its proposal that would have required accrediting bodies to make confidential hospital inspections public. You can read more about what the proposal would have done at ProPublica.If you're so inclined, check out the whole rule here.

Why liberals might want to sweat the details on single payer

This article by The Nation was getting a lot of attention on health care Twitter yesterday, thanks to the sharp reality check the liberal magazine was sending to progressive readers: It's time to start "sweating the details" on single-payer proposals.

  • For one thing, Medicare-for-all "is probably the hardest way to get there" — in part because the Democratic proposals on the table would make the transition too quickly.
  • There's also the "if you like your plan, you can keep it" problem. Then-President Obama faced an uproar when he had made that promise and then 1.6 million people weren't able to keep their plans.
  • "Under the current Medicare-for-All proposals, we would be forcing over 70 percent of the adult population...to give up their current insurance for Medicare."

Why it matters: The article doesn't even dive into all of the practical problems, like how to pay for single payer. But as the idea becomes more popular on the left, it's an important reminder to think through what such a huge transition would actually mean — especially after an ACA repeal debate in which Republicans clearly were not stressed out about the details.

And if you think "sweating the details" is a false equivalence between the left and right, by all means, come at us.

Caitlin Owens

What we're watching today: Senate procedural vote on the FDA bill, and maybe final approval after that. Also, Aetna earnings call before markets open.

What we're watching this week: Cigna earnings call, Friday before markets open.

What we're watching in September: Hearings on Alexander and Murray's ACA stabilization bill, week of Sept. 4.

What's your favorite broken part of the health care system? david@axios.com, baker@axios.com.