Friday, May 2, 2014

That Was The Week That Was - Issue 8

A look back at the week's health policy news with a focus on ACA implementation


Lots going on this week (although it feels like I say that most weeks). The final report for the now concluded first open-enrollment period was released, we also saw several new polls and much much more.  Let's dive in.
ACA: Enrollment Numbers
Over eight million sign-ups on healthcare.gov.  We had heard the number last week from the President, but now we have a lot more detail (Enrollment in the Health Insurance Marketplace totals over million people - announcement with link to tables).  Among the detail are breakout numbers for Maine, where we had 44,000 Mainers sign up for health insurance under Affordable Care Act (and being an equal opportunity blogger, here is the story from the Press Herald: Maine health enrollments beat expectations, officials say) .  That represents a 74% increase over the number from the end of February - by any measure a great accomplishment.  And while Maine lost the first place ranking in terms of percent of final target reached, the total still represented 192% of what the Feds originally expected for Maine (Enrollment by state with targets).
While there was a lot the enrollment report didn't tell us (What the enrollment numbers don’t tell us -full disclosure, I worked with Jackie on this piece so I'm biased when I say it does a good job looking at the larger picture) we did learn some new things (Four Things We Just Learned About Obamacare), some good such as the continued increase in Medicaid nationally, and some not so good such as Obamacare’s Hispanic enrollment is low, new HHS report shows.
(I can't mention the positive of the national Medicaid enrollment without pausing to lament yesterday's news that the legislature was unable to override the Governor's veto of Medicaid expansion here in Maine.  That means 70,000 Mainer's will continue to be denied access to health coverage until at least after the next election.)
For a deeper analysis of the report, we'll end this section with two dives into the report:  Tim Jost's blog post: Implementing Health Reform: A Summary Health Insurance Marketplace Enrollment Report and Ezra Klein's Seven things we now know about Obamcare enrollment.
ACA Polls/Politics
All these polls tell a similar story - despite the fact that many people know the law has signed up eight million people through the marketplaces, they think the implementation was a failure.  The majority also still oppose the law while at the same time they  don't want to see it repealed.
Previously I had been attributing the continued poor public perception to the fact that all the good news was more recent and those perceptions had not caught up to the reality.  Unfortunately, Ezra Klein has set me straight (Americans believe two things about Obamacare enrollment that can’t both be true). He talks about "belief echoes", after receiving negative information on a topic, even if later that information is corrected, the negative feelings persist.  That seems to be in play with perceptions of the laws implementation.  This complicates the communications strategy going forward.  (Not that there is a single communications strategy among supporters of the law, and not that the previous communication work has been as successful as we might have hoped.)
With the concept of belief echoes in mind, it's easier to understand the GOP report released this week regarding estimates of how many of those selecting a plan have paid their premium (GOP: Health signups lagging).  While the flaws in the report were quickly pointed out, the damage had already been done.  The report said that only 67% of those selecting a plan had paid their premium.  Among the problems with that number, it was calculated using as a base all the people who had selected a plan, including the millions who had done so in March and April and whose premium was not yet due.  Not to mention the fact that insurers themselves had been quoting an 80%-90% rate of people paying (Obamacare Is Getting the Benghazi Treatment, Courtesy of House Republicans). 
The irony that the key foundations of the ACA used to be conservative principles seems lost on some.  An alternative to the ACA was put forward by Scott Brown (ex MA Senator who in the best carpetbagger tradition is now running for Senate in NH).  His plan, minus the name looks very much like the ACA.  One of the reasons we've not seen a national "replace" plan put forward by the law's opponents is just this dilemma - it would inevitably look like the current law:  The Republican replacement for Obamacare is Fauxbamacare.
In case you were already tired of all the drama leading up to the 2014 elections, you can skip ahead as Health care wonks turn to 2016.  Here in Maine if you are still thinking about this year's elections, here is a  Interesting look at the impact of the ACA on our (Maine's) gubernatorial race.  Although not a perfect piece, it sets up some of the lines of disagreement we'll be hearing more about Obamacare gives voters a clash of candidates .
The nomination of Sylvia Burwell as the new Secretary of HHS was expected to be a battle.  It's now looking like her nomination will be confirmed (Sylvia Mathews Burwell: The Obamacare war that wasn't), although the hearings will still be a bit of a circus (Republicans to push anti-Obamacare message in Senate hearings).
And finally with respect to the laws opponents, offered for your amusement is this report on a group that is trying to convince insurance companies not to take Federal dollars: The Least Promising Anti-Obamacare Campaign.
ACA: Premiums/Costs
When insurers set rates they usually have the previous year's plan experience on which to base the new rates.  This year the Affordable Care Act plans pose actuarial and rate challenges for insurers.  That said, this week Insurers sound pretty happy about Obamacare.  The final age breakdown is looking like what they expected (remember, this was always the key question, not if the age breakdown mirrored the population measures) and people are paying their premiums.  While early on some insurers were nervous, the most outspoken  one has now reevaluated (Major Obamacare insurer backs away from double-digit rate hike prediction).
There will be 51 different stories to this year's rate increases - one for each state (and DC), because in spite of changes made by the law, each state is still it's own market.  So while overall U.S. says Obamacare enrollment points to stable costs we can be sure there will be a few states that are outliers and their high rate increases will be painted as a national calamity.
The GDP report for the first quarter was released this week and it showed Health Spending Gains as Obamacare Patients Use the Plans.  Total spending is based on a combination of unit cost and volume - the good news about the increased spending is that it seemed to be the result of volume.  If that turns out to be true, it represents a very expected development (That Spike in Health Care Spending May Be Here, Right on Schedule: Cue premature, unnecessary panic).  People who were without coverage for a long period of time will have pent-up demand for services, so it is to be expected that there would be a spike usage of services as they gain coverage.  If anything, we can view this as a positive development - people are no longer postponing the care they need.
ACA: Other
The New York Times had an in-depth piece Envisioning the End of Employer-Provided Health Plans.  While it is well done it's not perfect and was a bit fuzzy on some crucial details.  Let's take a look at the issue. 
To start out you have to understand that it is not possible to overestimate the importance of the tax advantage employer-sponsored plans have over the individual market.  The deduction costs the Federal Government $250 billion dollars a year.   When the ACA was being drafted, expanding the tax deduction of premiums to individual policies was discussed, but it was just too expensive.  As long as that duality remains, it will be very hard for employers to truly leave the market.
Note that there is a difference between the move to a defined contribution health strategy and leaving the employer market.  It is possible for the way employer-sponsored coverage is provided to change drastically while still preserving the current tax advantages - but that does NOT include the ACA marketplaces (and does NOT include employees being able to access the individual subsidies), instead it includes private marketplaces (or exchanges).  This shift would mirror what we saw happen to pensions with the switch to 401(k) plans.  Instead of a defined benefit, a set dollar amount pension you would receive once you retire, the employer provided a defined contribution plan - they set the amount they contribute, the amount you receive when you retire depends on how the account does in the meantime.  For health benefits, the employer would set an amount they would contribute and send the employee to a private marketplace - the employee would purchase whatever plan they wanted and be responsible for the difference in cost over what the employer contributed.  With a private marketplace this could be done in a way that the employee's contribution is still paid with pretax dollars.  So with this in mind you can see that  talk of the death of employer-sponsored coverage has been greatly exaggerated.
While healthcare.gov underwent a remarkable recovery after its initial launch, much work on the site remains to be done.  A lot of the back-office functionality where it pays the insurance companies subsidies is still a semi-manual process and needs to be fixed (Behind the scenes, much of HealthCare.gov is still under construction).  With the contract for administering the website expiring, the Administration Begins Search for New Contractors to Run Health Care Site. 
Some front-office functions still need work too, among them are the availability of provider network and formulary information.  A recent review found Health exchanges’ drug coverage confusing highlighting the need for a technical fix so individuals can check on benefits during the process.
The question "is a state better off running its own Marketplace" may be seen as a toss-up so far.  Some states (CT) were very successful, some (OR) were outright disasters and most fell somewhere in-between.  Initially some thought that it would be more efficient to just have one Federal Marketplace (that is how the initial House version of the ACA was written) while some thought the States should have the control.  With the jury is still out, we note that although there is still funding for states to build their own Marketplaces, Most States To Rely On Federal Website For 2015 Enrollment.
We saw another "fix" pass the House this week.  Some said the House passes bipartisan fix to health law the truth is that it was not quite bipartisan.  There is widespread agreement on the need for a fix under the health law for U.S.-written expatriate plans that can be sold to Americans working overseas and foreigners working here or elsewhere. The original bill was supported by the White House to fix this issue but they ended up objecting to the final version due to loophole that would allow permanent residents to purchase these non-compliant plans indefinitely.
Drugs
The cost of drugs is always an issue.  One of the stories we've been told is that the exorbitant price of brand name drugs is because of the need to recoup the development costs both on the drug produced and on all the drugs that never make it out of the pipeline.  That reasoning is coming more and more into question due to the fact that the Federal Government ends up paying for a lot of the basic science leading to these drugs and that many of these drugs are simply reformulations or packaging of existing products (Why patients cannot afford to have asthma or gout, For Drugs That Save Lives, a Steep Cost).
Last week saw a transfer of units among three major pharmaceutical firms, this week saw what was almost, and still could be, one of the largest mergers in history with Pfizer Proposes a Marriage With AstraZeneca, Easing Taxes in a Move to Britain.  Doesn't sound like improved science is the motivation for the deal, and while AstraZeneca Snubs Pfizer Approach That U.K. Won’t Block, the deal is by no means dead, so stay tuned.
In addition to cost, we also need to keep our eye on the quality and safety of prescription medications.  150 Americans have die annually and tens of thousands have gone to the emergency room each year due to overdoses  of Tylenol (Here's why you shouldn't take extra-strength Tylenol).  As you can read in the article, while the FDA is taking steps to limit intake through prescription drugs, not enough is being done regarding the over-the-counter formulations.
The FDA fails in removing other harmful "drugs" from stores (Why Dangerous Supplements Linger on Store Shelves).  And on the topic of supplements, remember that just because something is "natural" does not mean it's safe (A few thought-provoking questions about essential oils).
Also this week the World Health Organization released a report on the dangers of antibiotics:  Planet headed toward ‘post-antibiotic era’ when treatments don’t work: WHO.
Costs
Some great reminders on where the money to pay for our health care system really comes from (spoiler alert, it's not really the free market system you thought it was) Who really pays for health care? It might surprise you.  This also gets at one of my underlying principles when we discuss health care - ultimately it's you and me that are paying.   It may be funneled through taxes or reduced wages, but ultimately it comes out of our pockets.
Maryland has long been a leader in attempts to control health care spending.  That leadership continues with its most recent attempts to put hospitals and health care systems on a budget.  Success here could see other states give these methods a try (The Maryland approach to controlling health costs). 
A reminder from the CDC that Hundreds of thousands of Americans die unnecessarily every year.  Why is this article in the costs section?  Because the system expends resources on these unnecessary deaths (and the conditions that lead to them).  A major factor in four of the five leading causes of death is tobacco - and while we may be winning the fight against smoking, we can see from these numbers that it's far from over.  The four conditions related to tobacco are: heart disease, cancer, lung disease and stroke with the fifth leading cause being  unintentional injuries (CDC: 5 things cause two-thirds of U.S. deaths).
System Reform
Before ending with our laundry list of system reform articles, I'd like to pause and take a step back to remember why we're doing all this.  Health care isn't a goal in and of itself, it's one means to ensuring our quality of life. Sometimes that actually means saying no to health care (Quality of life: We say it, but do we mean it?) and knowing when to have difficult conversations (Speaking up about hospice is not a betrayal of our family members).
And finally, this week's laundry list of articles talking about the transformation taking place around us.


All comments and suggestions are welcome; please let me know what you think.  And as always, thanks for reading!
Funded by support from the Maine Health Access Foundation

*The title is a tribute to the BBC show, the NBC show and the amazing Tom Lehrer album "That Was The Year That Was"
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