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If President Trump administration had been skirmishing with the Affordable Care Act, he’s now declared all-out war.
Two-and-a-half weeks before the health-care law’s already-shaky marketplaces are set to open for 2018 enrollment, the Trump administration has announced it will abruptly halt critical payments to health insurers that help millions of lower-income Americans afford coverage. Late last night, the Department of Health and Human Services said it will immediately end these monthly payments, a move that could push premiums as much as 15 to 20 percent higher and prompt more insurers to withdraw from the marketplaces altogether.
The decision represents Trump’s most consequential move to date to undermine the 2010 law advanced by his predecessor, Barack Obama. It comes after an executive order the president signed yesterday — which could also negatively affect the marketplaces by prompting some healthier enrollees to switch to plans sponsored by trade associations — and just weeks after Senate Republicans failed in their second attempt to advance ACA rollback legislation.
It’s abundantly clear the president is thirsty for a win on Obamacare. It’s been 10 months since his first day in office — the day he promised to sign a law repealing and replacing the health-care law. He tweeted this, this morning:
ObamaCare is a broken mess. Piece by piece we will now begin the process of giving America the great HealthCare it deserves!
— Donald J. Trump (@realDonaldTrump) October 13, 2017
–Even before last night’s move, the Trump administration’s ability to actually make these payments (known as cost-sharing reductions, or CSRs) was dicey because of a lawsuit House Republicans filed back in 2014 against the Obama administration. At the time, Republicans charged the administration didn’t have the authority to make the CSR payments because Congress needed to appropriate the funding.
Late last year, a federal judge sided with the House, saying the money needs to be disbursed by Congress. Which means that the Trump administration would have had to challenge that ruling in order to keep making the payments indefinitely. Continuing the payments would violate “the legal boundaries drawn by our constitution,” HHS Acting Secretary Eric Hargan and Seema Verma, administrator for the Centers for Medicare and Medicaid Services, said in a statement late last night announcing the decision to halt them.
“It has been clear for many years that Obamacare is bad policy. It is also bad law. The Obama administration unfortunately went ahead and made CSR payments to insurance companies after requesting – but never ultimately receiving — an appropriation from Congress as required by law,” they said. “Congress has not appropriated money for CSRs, and we will discontinue these payments immediately.”
House Speaker Paul Ryan (R-Wis.) agreed in a statement late last night, tweeted by Bloomberg’s Sahil Kapur:
Paul Ryan supports Trump’s decision to end the Obamacare cost-sharing payments and gives no indication that Congress will appropriate them. pic.twitter.com/7c6tVaFoV0
— Sahil Kapur (@sahilkapur) October 13, 2017
Conservative thinkers were also pleased. Michael Cannon, the libertarian Cato Institute’s director of health-policy studies:
2. Critics of Trump’s decision to end CSR payments seem to forget a federal judge called them unconstitutional and ordered that they stop.
— Michael F. Cannon (@mfcannon) October 13, 2017
–But the Trump administration is injecting turbulence into the Obamacare marketplaces by cutting off the payments just as insurers are finalizing their 2018 plan offerings. Losing the approximately $7 billion in annual payments, which reimburse insurers for discounting deductibles and co-payments for the lowest-income enrollees, is grounds for insurers to back out of their federal contracts to even sell plans next year. The administration had been making the payments on a month-to-month basis, prompting complaints by insurers about a lack of certainty as they tried to plan ahead.
From the New York Times’s Margot Sanger-Katz:
This change will allow insurers to back out of 2018 contracts. Not clear who will, but could destabilize markets weeks before open enrollment.
— Margot Sanger-Katz (@sangerkatz) October 13, 2017
From the senior vice president of the Kaiser Foundation:
Insurers have already signed marketplace contracts for 2018, but those contracts reportedly have an exit clause. Could we see bare counties?
— Larry Levitt (@larry_levitt) October 13, 2017
The six-week ACA enrollment period for 2018 is scheduled to start Nov. 1, allowing around 11 million Americans to shop for private, subsidized coverage on Healthcare.gov and other state-run marketplaces. Many of them were already facing higher premiums and fewer plan options — and the administration’s move could worsen the situation. Insurers have said halting the CSRs would be the single greatest step the administration could do to undermine the marketplaces.
“Millions of Americans rely on theses benefits to afford their coverage and care,” Kristine Grow, spokeswoman for America’s Health Insurance Plans, emailed me late last night after the announcement came out.
Trump’s move also heightens pressure on a leading Senate Republican who had been trying to hammer out a bipartisan agreement to fund the CSRs. Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) had been in talks for two months about appropriating the funding for 2018 and 2019 as a way to stabilize the marketplaces, but they’d been hampered over disagreements about how much state flexibility to inject into such a bargain. Conservative Republicans have been unwilling to pay CSRs without rolling back Obamacare regulations, but Democrats say they won’t ditch any of the law’s consumer protections.
“Senator Murray strongly opposes President Trump’s reckless, harmful health care sabotage and is continuing to work on bipartisan steps to help undo the damage, by stabilizing markets and protecting patients and families from premium increases,” a Murray aide told me this morning.
Had Hillary Clinton won the White House, Democrats would have been blamed for the marketplace problems. Now, Trump has ensured that Republicans will be blamed not only for existing marketplace woes, but for intentionally and severely exacerbating the problem. Initial reactions from Democrats:
Senate Minority Leader Chuck Schumer (D-N.Y.) and House Minority Leader Nancy Pelosi (D-Calif.) called it “pointless sabotage” in a statement late last night. Schumer tweeted this, too:
Sadly, instead of working to lower health costs for Americans, it seems @POTUS will singlehandedly hike Americans’ health premiums.
— Chuck Schumer (@SenSchumer) October 13, 2017
California Attorney General Xavier Becerra says he’ll sue:
— Xavier Becerra (@AGBecerra) October 13, 2017
Even a Republican (who is retiring next year) slammed Trump. Rep. Ileana Ros-Lehtinen (R-Fla.):
Cutting health care subsidies will mean more uninsured in my district. @potus promised more access, affordable coverage. This does opposite.
— Ileana Ros-Lehtinen (@RosLehtinen) October 13, 2017
Sahil notes this:
It really is remarkable how differently retiring and non-retiring congressional Republicans talk about President Trump.
— Sahil Kapur (@sahilkapur) October 13, 2017
BREAKING: Maine Republican Sen. Susan Collins will stay in the Senate after considering a bid for governor in 2020, she announced this morning. Enjoying strong favorable ratings, Collins emerged as one of the leading moderates who thwarted several GOP health-care bills in the Senate that would have dramatically lowered future Medicaid spending. You can expect her to continue to be a thorn in the side of Trump and other Republicans who want to overhaul Obamacare in similar fashion.
From Sean Sullivan: “’The best way that I can contribute to these priorities is to remain a member of the United States Senate,’ Collins [said in Maine this morning], capping a speech in which she described her role as a bipartisan figure on such issues as health care and national security in Washington … Collins read aloud a letter from a Senate colleague: ‘The institution would suffer in your absence. There are very few who have the ability to bring about positive change; you are such a person.’ Her final decision, she said, came down to ‘my sense of where I can do the most for the people of Maine and for the nation.'”
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AHH, OOF and OUCH
AHH: Two experts on opioid abuse said yesterday that the FDA should consider banning “ultra-high-dosage” painkillers from the market, and law enforcement must step up efforts to curb the flow of heroin and fentanyl into the United States if the nation hopes to come to grips with the opioid epidemic, The Post’s Lenny Bernstein reports.
Brandeis University’s Andrew Kolodny and former CDC Director Tom Frieden also recommended these steps: restructuring or eliminating the marketing of opioids for chronic pain; better insurance coverage and access to alternative pain treatments; and expansion of treatment and “harm reduction” measures such as needle exchange programs.
Many of the recommendations reflect expert consensus, including their push for expanded treatment and wider availability of the overdose antidote naloxone and for doctors to use more caution prescribing opioids. But other recommendations, such as banning high-dose opioids and improving data-gathering on the addiction crisis, have been heard less often.
“No current information systems enable real-time assessment of the numbers, patterns or trends of new opioid addiction,” the two wrote. “This makes it impossible to determine the trajectory of the epidemic.”
OOF: The VA has pledged to overhaul its reporting policies for bad medical workers, after USA Today found the agency has routinely concealed shoddy care and staff mistakes. Yesterday, VA Secretary David Shulkin directed the agency to report all clinicians — not just some — to a national database set up for the purpose of tracking problematic medical workers. A 30-year-old policy had limited what providers that agency would report.
The newspaper previously found the VA has frequently failed to ensure its hospitals reported problem providers to state licensing boards, and that it left out thousands of providers when reporting to the national database. The agency previously reported only physicians and dentists — no nurses, physicians’ assistants, or podiatrists.
In one case, a podiatrist at its hospital in Maine harmed 88 veterans, including a woman who after two failed ankle surgeries chose to have her leg amputated rather than endure the pain. In other cases, VA hospitals signed secret settlement deals with dozens of doctors, nurses and other health-care workers that included promises to conceal serious mistakes — from inappropriate relationships and breakdowns in supervision to dangerous medical errors — even after forcing them out of the agency.
OUCH: A government watchdog finds “substantial reason to believe” that Rep. Chris Collins (R-N.Y.) violated federal law by meeting with government researchers to benefit a biotech company he’s invested in and sharing private information to drum up investments in that company, my colleague Mike DeBonis reports.
Collins was an early backer of Innate Immunotherapeutics, an Australian firm that was developing a new therapy for multiple sclerosis. The Office of Congressional Ethics started probing in March whether Collins overstepped bounds in his advocacy for the firm and corroborated some allegations in July. The report, published Thursday by the House Ethics Committee, could leave Collins vulnerable to ethics sanctions or even potential criminal prosecutions based on allegations of insider trading.
–Guess who else invested in Immunotherapeutics? None other than recently-departed HHS Secretary Tom Price, who faced questions about the matter during his confirmation hearings early this year after he was found to have purchased a significant stake in the company. Price’s name appears at the top of a list of officials who didn’t comply with the ethics probe, the report says.
The list, per Bloomberg’s Alex Ruoff:
Tom Price refused to cooperate with congressional ethics inquiry into possible insider trading by fellow Republican Chris Collins pic.twitter.com/145NRnZx1L
— Alex Ruoff (@Alexruoff) October 12, 2017
–The ethics office didn’t corroborate the allegation that drove much of the media coverage of Collins’s ties to Innate Immunotherapies: that he acted improperly in recruiting friends and colleagues (including Price) to participate in a special discounted “private placement” stock sale, Mike writes. But it did find other new instances of potential wrongdoing.
Last November, Collins and a staffer visited the National Institutes of Health to meet with a key researcher into multiple sclerosis and allegedly asked [for] help in designing Innate Immuno’s drug trial. The meeting came after Collins had mentioned Innate Immuno’s drug to a top NIH official in a House committee hearing without disclosing his stake in the company. The official then invited Collins for a visit.
“The report also found that Collins on several occasions gave potential investors details on Innate’s drug trials that were not available in the company’s public filings,” Mike writes. “That, investigators found, could implicate federal insider-trading laws and the Stock Act — a 2012 law that makes clear members of Congress are covered by those existing laws.”
–Yesterday President Trump signed an anticipated executive order intended to circumvent certain ACA rules by making it easier for individuals and small business to buy alternative types of health insurance with lower prices but fewer benefits, The Post’s Amy Goldstein reports.
“The White House and allies portray the president’s move as wielding administrative powers to accomplish what congressional Republicans have failed to achieve: fostering more coverage choices while tearing down the law’s insurance marketplaces,” Amy writes. “The order represents Trump’s biggest step to date to reverse the health-care policies of the Obama administration, a central promise since last year’s presidential campaign.
“Critics, who include state insurance commissioners, most of the health-insurance industry and mainstream policy specialists, predict that a proliferation of these other kinds of coverage will have damaging ripple effects: driving up costs for consumers with serious medical conditions and prompting more insurers to flee the law’s marketplaces. Part of Trump’s action, they say, will spark court challenges over its legality.”
Watch the signing:
There are several pieces to the order:
–It instructs a trio of Cabinet departments to rewrite federal rules for so-called association health plans. Though these plans have had to meet coverage requirements and consumer protections under the ACA, the administration is likely to exempt them from those rules, as well as let such plans be sold from state to state without insurance licenses in each one.
–It expands the availability of short-term insurance policies, which offer limited benefits as a bridge for people between jobs or young adults no longer eligible for their parents’ health plans. The Obama administration ruled that short-term insurance may not last for more than three months; Trump wants to extend that to nearly a year.
The Post’s Amber Phillips lays out the options available to the president to fix, save, undermine or gut Obamacare — now that Congress has failed to repeal the law — and where this new executive order fits.
Of course, Trump insisted yesterday that he was providing “Obamacare relief” in remarks shortly before signing the order. “This will cost the United States government virtually nothing and people will have great, great, healthcare,” he said. “And when i say people, I mean by the millions and millions.”
–Yet health-care associations and medical groups turned out in droves to oppose the order, raising concerns that it could further weaken the ACA marketplaces — already suffering from big premium spikes and reduced plan offerings. Here’s a sampling of their responses:
American Hospital Association: “Today’s executive order will allow health insurance plans that cover fewer benefits and offer fewer consumer protections. No one can predict future health care needs with complete certainty and such plans could put patients at risk when care is needed most.”
American Medical Association: “The AMA supports patient choice and promoting market competition, and supports the concept of association health plans. We have concerns, however, the executive order’s proposal to expand access to association health plans and allow short-term plans to cover longer time periods may weaken important patient protections and lead to instability in the individual health insurance market.”
America’s Health Insurance Plans: “We believe that reforms must stabilize the individual market for lower costs, higher consumer satisfaction, and better health outcomes for everyone. And we believe that we cannot jeopardize the stability of other markets that provide coverage for hundreds of millions of Americans. We will follow these principles – competition, choice, patient protections and market stability – as we evaluate the potential impact of this executive order and the rules that will follow.”
–The order will almost certainly be challenged in court. Several experts in health care and employment law told Reuters that it could violate the U.S. Employee Retirement Income Security Act (ERISA), the federal law that governs large employer plans. ERISA does allow associations to act as employers and manage benefit plans, but federal regulators have generally interpreted the law to mean that employers in the association must have a common interest beyond buying insurance.
California AG Becerra signaled yesterday he may pursue legal action. “The president seems intent on imploding the ACA,” Becerra said in a statement. “This executive order is just another step in that direction. It should come as no surprise that California is prepared to fight in court to protect affordable health care for its people. We’re heading in a different direction.”
Members of Trump’s Cabinet of course cheered the move. Treasury Secertary Steven Mnuchin’s statement, per Reuters’ Pete Schroeder:
Treasury Secretary Steven Mnuchin puts out a statement praising Trump for his healthcare EO. For some reason. pic.twitter.com/d4YZ4aidfB
— Pete Schroeder (@peteschroeder) October 12, 2017
HEALTH ON THE HILL
–Sen. Rand Paul (R-Ky.) was also enthused, as he’d been working with the White House on the ideas involved in the executive order. His reaction:
So did other Republicans in the House and Senate. Sen. Ron Johnson (R-Wis.):
— Senator Ron Johnson (@SenRonJohnson) October 12, 2017
Sen. James Lankford (R-Okla.):
— Sen. James Lankford (@SenatorLankford) October 12, 2017
Sen. Shelley Moore Capito (R-W.Va.):
New executive order from @POTUS is a first step to help make health insurance more affordable and accessible for all Americans.
— Shelley Moore Capito (@SenCapito) October 12, 2017
A few more good reads from The Post and beyond:
- Axios hosts an event on what’s next for health care with Sens. Lamar Alexander (R-Tenn.), Bill Cassidy (R-La.), and Tim Kaine (D-Va.) on October 18.
How Trump’s executive order could weaken Obamacare:
Here’s how the 25th Amendment works:
Trump’s 10 softest interviews as president, ranked:
Watch Stephen Colbert’s interview of Sean Hannity’s interview of Trump: