Published 9/1/2018

Second Look—Advocacy

‘Medicare for All’ costs

A study from the Mercatus Center at George Mason University in Virginia found that Sen. Bernie Sanders’ (I-Vt.) “Medicare for All” healthcare plan would cost $32.6 trillion over 10 years (2022–2031), according to a report from The Associated Press. The plan is projected to provide significant savings on administration and drug costs (projected $846 billion over 10 years), but increased demand for care would drive up spending and require historic tax increases.

Short-term health insurance

The departments of Health and Human Services (HHS), Labor, and Treasury issued a final rule that allows health insurers to offer short-term, limited-duration coverage that is less expensive but also less comprehensive. The short-term plans are available for up to 12 months and can be renewed for a maximum duration of 36 months in total. The administration estimates that premiums will be a third of the cost of comprehensive coverage, but a survey from the Kaiser Family Foundation found that none of the short-term plans covered maternity care, many did not cover prescription drugs, and all may include dollar limits on coverage. Open enrollment for these plans will begin in October for coverage starting January 2019. These plans are not required to comply with federal market requirements under the Affordable Care Act (ACA).

Medicaid fraudulent activity

According to a federal report, some Medicaid insurers are falling short in reporting fraudulent and unethical medical providers. A third of the health plans seen by the HHS inspector general’s office referred fewer than 10 cases of fraud or abuse for further review in 2015. In addition, no fraudulent cases were reported by two of the insurers throughout all of 2015.

The report also indicated that some health plans dropped fraudulent providers but did not report them to the state. Some insurers failed to reclaim millions in overpayments to doctors and other healthcare providers, which the report indicated would likely reward insurers in profit because the higher costs can lead to increased Medicaid rates.

Ambulatory surgery center
safety database

HHS has requested permission from the Office of Management and Budget to create a database on patient safety at ambulatory surgery centers, Modern Healthcare reports. The request follows a joint investigation by Kaiser Health News and USA Today that raised concerns about the quality of care and safety at such facilities. In 2016, there were 5,532 Medicare-certified centers, which was a 3.5 percent increase from 5,344 in 2011, reflecting an average annual growth rate of 1.3 percent. Approximately 3.4 million Medicare beneficiaries receive care at these centers annually.

Tax tariffs impact
medical device companies

Medical Imaging and Technology Alliance (MITA) estimates that President Donald Trump’s tariff on Chinese imports may cost American medical device makers more than $138 million, an article in Healthcare IT News reports. The 25 percent tariff that went into effect on June 6 applies to MRIs, sonograms, pacemakers, and other devices, with CT scanners and radiograph devices expected to be hit the hardest. A recent MITA survey predicted that the tariff will cause companies to downsize and reduce budgets for research and development. MITA requested that the Trump administration exempt medical devices from the tariffs, arguing that they are “humanitarian goods.” The administration argued that the tariffs were put in place to combat China’s trade policies.

Fluoroquinolone antibiotics risks

The Food and Drug Administration (FDA) is requiring a safety labeling change for fluoroquinolone antibiotics to indicate the risks of mental health side effects and serious blood sugar disturbances. The request for a label change is based on a review of adverse events (AEs) and case reports published in the literature. A range of mental health AEs are described in the Warnings and Precautions section of the drug labeling, but they differ from one drug to another. The new labels must have mental health AEs listed separately from other central nervous system side effects and be consistent across the labeling of the entire fluoroquinolone class. Mental health AEs include disturbances in attention, disorientation, agitation, nervousness, memory impairment, and delirium.

Inpatient hospitalizations decrease

A survey of executives at almost 50 not-for-profit hospitals released by investment bank Leerink Partners indicates that the number of inpatients continues to decrease as patients move toward less expensive outpatient options, per a report in Modern Healthcare. The survey found that inpatient utilization increased 0.7 percent in the second quarter of 2018, down from a 1 percent increase in 2017. Ambulatory surgery center utilization was up 1.4 percent in the second quarter but down from the 2.2 percent seen in 2017. Outpatient utilization growth fell from 2.5 percent in 2017 to 1.1 percent. Hip procedures performed in the outpatient setting are expected to increase from 17 percent in the past year to 19 percent in the coming year, whereas inpatient hip procedures will likely decrease from 77 percent to 75 percent.

Paper versus EHRs

A study published online in Health Affairs found that hospitals may see lower mortality rates after switching from paper to electronic health records (EHRs). However, mortality rates could initially increase in the first year of the transition. Researchers examined the magnitude of digitalization and one-month mortality rates for patients 65 years and older from 3,249 hospitals between 2008 and 2013. Multiple hospitals had EHRs at the start of this period, and many did not make the transition until after 2009. Initially, hospitals displayed an additional 0.11 percentage point higher mortality rate for every new EHR function. As time went on, each function was associated with a 0.09 percentage point drop in mortality, and each function added mid-study yielded a 0.21 percentage point drop.

Impacts of an ACA repeal

Kaiser Health News reports that states that oppose the ACA appear to be the ones that would be most affected if the law is repealed. Nine of the 11 states with individuals 65 years and older with the most preexisting conditions have signed onto a suit against ACA, according to data from the Centers for Disease Control and Prevention and insurance companies. West Virginia has the most adults with preexisting conditions, 36 percent of whom are younger than 65 years. Without ACA protections, a third of those residents would have trouble purchasing insurance through the individual marketplace.

MIPS reporting and
PTAC payment models

During a hearing before the health subcommittee of the U.S. House of Representatives’ Energy and Commerce Committee, physicians called on the Centers for Medicare & Medicaid Services (CMS) to change course on opt-out policies for Merit-based Incentive Payment System (MIPS) reporting. CMS proposed that physician practices with less than $90,000 in Medicare revenue or fewer than 200 unique Medicare patients per year could be exempt from MIPS, leaving less than half (approximately 40 percent) of the 1.5 million doctors billing Medicare to comply with the system and reducing incentives for the program. In addition, CMS has not yet adopted any alternative pay models recommended by the Physician-focused Payment Model Technical Advisory Committee (PTAC), despite receiving 10 suggestions from specialty societies and physician groups.