Some of the behavioral changes that the Affordable Care Act seeks to bring about are prompted directly by the Act or a federal agency acting pursuant to the Act. The “individual mandate” that people buy health insurance is one example; individuals who do not change their behavior to comply with that particular provision of the law are subject to a tax penalty imposed by the IRS.
But much of the work of the ACA is done through regulatory intermediaries that are themselves incentivized by the Act to find ways to bring about the end-user behavioral changes that the ACA is really after. Medicaid expansion is a straightforward example–under the ACA the federal government does not provide insurance coverage to those who make less than 133% of the federal poverty line, rather, it incentivizes states to do so. Accountable Care Organizations are another somewhat more roundabout example: the Act incentivizes doctors to form organizations that will themselves incentivize doctors to coordinate care and patients to obtain more value-maximizing services.
Like any principal-agent relationship, regulating through an intermediary has benefits and costs. The intermediary (state, employer, insurer, doctor, etc.) may be differently positioned than the federal government to obtain information about, and influence the behavior of, the actors whose collective behavior we ultimately care about, for better or worse. And certain intermediaries may be differently responsive to the concerns of those impacted by the policies they enact than the federal government, again for better or worse. Continue reading →
What role did geography, advertising, community, Navigators, and the controversy surrounding the Affordable Care Act (ACA) play in consumers’ decisions whether to purchase health insurance in the individual marketplaces? The percentage of potential exchange marketplace enrollees who actually made use of the marketplace to purchase insurance varied widely from state to state for 2014 and 2015.
As of February 22, 2015, for example, there were eight states with enrollment at 50 percent or greater and eight states with enrollment at 25 percent or lower. (Per the Kaiser Family Foundation, the top eight were Vermont, Florida, Maine, DC, Delaware, Pennsylvania, New Hampshire, and North Carolina. The bottom eight were Colorado, Ohio, Alaska, Hawaii, North Dakota, Minnesota, South Dakota, and Iowa).
It would be an interesting and challenging task to explain this variation empirically. Generating reliable statistical inferences from inter-state comparisons is notoriously difficult, and the variables at play here range from the easily measured (percent of population eligible for subsidies, navigator grant amounts, number of participating insurers, premiums) to the not-so-easily measured (enthusiasm for Obamacare, efficacy of state or federal outreach efforts, geography, education, availability and usefulness of charity care and emergency Medicaid, functionality of state exchange website, population health, availability of health services). […]
We’ve heard a lot about “death spirals” and how they could stand in the way of the Affordable Care Act’s goal of a functioning individual health insurance marketplace. Seth Chandler has an interesting blog devoted to the subject, “ACA Death Spiral.” And those who have been following King v. Burwell, the Supreme Court’s latest ACA case, have been predicting that a ruling against the government there would be disastrous because it would only exacerbate the “death spiral” threat to individual health insurance markets. (See a sum-up of such predictions here.)
But could death spirals save the ACA? According to a fascinating amicus brief filed in the King case by a number of interest groups and co-signed by several prominent law professors and Bill of Health contributors (I understand that Abigail Moncrieff is the driving force behind the brief, joined by Allison Hoffman, Sharona Hoffman, Russell Korobkin, Joan Krause, Stephen Marks, Kevin Outterson, and Theodore Ruger), the answer might be yes. The argument boils down to “death spirals to the rescue.” (Here is a copy: 14-114 bsac JALSA.)
As the backlog of Medicare appeals indicates, Medicare claimants are seeking many more hearings than we can currently provide. The mismatch makes a fundamental question particularly acute: Why do we hold hearings to review Medicare coverage decisions in the first place?
It’s a question worth asking. The Affordable Care Act mandated that denials of private health insurance coverage be reviewed by external, contract medical specialists, without a hearing. (See here.) If we are comfortable with private, sometimes profit-motivated coverage decisions obtaining external review review by someone other than an Administrative Law Judge (ALJ), without a hearing, why do we feel differently about Medicare coverage decisions? Continue reading →
One option for dealing with the backlog of Medicare claims waiting for a hearing is to settle them. That’s up to the Centers for Medicare and Medicaid Services, not the Office of Medicare Hearings and Appeals that actually oversees the process, so it’s not an administrative fix that the Office of Medicare Hearings and Appeals could actually implement alone. But it is worth considering, and the CMS has shown an openness to it by going along with the proposal for facilitated settlement and by offering to settle a big chunk of pending inpatient hospital admission disputes for 68 cents on the dollar. (See Nick Bagley’s post at the incidental economist.)
These settlement efforts have received some high-level scrutiny, however. Last month Representative Brady, Chair of the House Ways and Means Committee, Subcommittee on Health, sent the HHS a strongly-worded letter after the inpatient hospital settlement was announced, arguing that the settlement may exceed CMS’s statutory authority, among other problems. (See the letter linked here (“I question whether HHS has statutory authority for this settlement process.”)
Next week (on October 29) Medicare’s Office of Medicare Hearings and Appeals (OMHA) is holding another appellant forum to discuss the ongoing backlog of Medicare claims waiting for a hearing. In one sense, a lot has happened since the last forum in February (I covered that here): OMHA announced pilot projects to try statistical sampling and facilitated settlement in some cases (see here and here); CMS (effectively the “defendant” for settlement purposes in these appeals; functionally independent from OMHA) announced a willingness to settle a subset of pending inpatient hospital billing claims for 68 cents on the dollar (see Nick Bagley’s post at the incidental economist); the backlog came up at a couple congressional hearings; and two lawsuits were filed to challenge it, one by providers (see here) and another by beneficiaries (see here).
In another sense, not that much has happened. Unless Thursday’s forum brings big news—and I know that OMHA and CMS have been working hard on reforms so perhaps it will—there is still a big backlog of Medicare appeals, there is still not a resource fix in sight, and the influx of Medicare appeals seems to still far outstrip OMHA’s capacity to hold hearings.
In advance of the forum, I’m planning a series of posts offering my thoughts, such as they are, on where we are and where we are going. I invite anyone who disagrees or thinks I’ve gotten something wrong to post their own views in the comments. Or you can email me and I will look into sharing your thoughts as an independent posting. You can get all my posts on this subject, including new ones as they come in, by clicking here.
A caveat: I’m approaching these as blog posts—trying to get my educated thoughts based on everything I have read out in a timely way—but I might be missing something. If the upcoming forum or comments reveal that I am–I won’t be there in person but will be watching remotely–I will either post a general update or go add particular updates in the text of my posts as necessary.
And a disclosure: I’ve said this before but want to do it once more again before pontificating—I worked in government until a little over a year ago, so my views on these matters may be biased. (And of course I will not discuss anything I worked on.) But I’ve done my best to be objective.
As we gear up for a second year of exchange marketplace enrollment, one issue to keep an eye on is the success we have at getting people who live in rural areas onto the healthcare rolls. As pointed out in today’s Kaiser Health News write-up (here), there is potential for the ACA to increase rural health disparities, even while it gets more people insured, because many of the efforts to encourage enrollment–think navigators, enrollment centers, advertising, and outreach–just work better in urban areas. For some reading on this issue, see the Kaiser Family Foundation’s posting here, the HHS’s Health Resources and Services Administration’s report here, and the Rural Health Foundation’s roundup here.
I have blogged a few times about the current backlog in Medicare’s coverage appeals process, including observations about a lawsuit by providers challenging the backlog in federal court in the District of Columbia. (See here.) Yesterday a new lawsuit was filed, this one a class action lawsuit by beneficiaries represented by the Center for Medicare Advocacy. (See their press release here.) The case is Lessler et al. v. Burwell, 3:14-CV-1230 (D.Conn.). I am blocked from accessing the complaint on PACER but am working on getting a copy.
Without access to the complaint it is dangerous to speculate, but I wonder whether this suit may be subject to many of the exhaustion-based arguments that I thought could lead to dismissal of the provider suit. But the Center for Medicare Advocacy has had success pursuing class action suits on behalf of Medicare beneficiaries before, most notably the Jimmo case that led to a significant change in the standard of qualification for skilled nursing care. (See here.)
One thing about this suit that may only be interesting to administrative law buffs is the choice of forum. This case was filed in Connecticut, not the District of Columbia (where the providers filed their suit). As I have written about elsewhere, there are pros and cons to channeling administrative law cases through DC, among them DC’s expertise in exhaustion and other administrative law issues.
I can’t say whether the Center for Medicare Advocacy chose to file in Connecticut rather than the District solely because that is their home forum, or whether they thought they’d get a more sympathetic judge/more plaintiff-friendly exhaustion doctrine. And the same goes for the providers’ choice to file in the District rather than some other state. I can say from experience, though, that the choice can really matter; DC judges’ familiarity with administrative law issues just makes them perceive these cases differently from the start. So it would not surprise me at all if there are considerations beyond mere location at play here. (Not that there’s anything wrong with that!)
Today the government moved for en banc rehearing in Halbig, as expected. (HT: Rachana Dixit Pradhan @ insidehealthpolicy.com.) I have not had the chance to review the petition but thought I would share it. (For those looking to brush up on some of the blog debate on the case before reading, see here and here. For more details on the en banc process see my earlier post here.)
The Government argues that rehearing en banc is warranted because the “disruption threatened” by Halbig makes the case one with exceptional importance. One interesting bit did catch my eye, in light of that assertion. It is footnote 7, which offers the Government’s view on the impact of the ruling in Halbig, and might be taken as sort of a cf.:
“The panel majority suggested that its ruling would apply nationwide, Op. 41-42, but it did not squarely hold as much or address the many reasons why relief should not extend beyond the named plaintiffs. The panel’s decision does not control in other circuits, just as the Fourth Circuit’s King decision does not control here.”
This morning the D.C. Circuit ruled that the ACA “unambiguously restricts the section 36B subsidy to insurance purchased on Exchanges “established by the State.” (See opinion here.) In other words, the court ruled that the subsidies that make insurance on federally-operated exchanges affordable are illegal.
In the news and blog coverage this has already received, the possibility of this decision being reversed “en banc” has been mentioned. (See here, here, and here for news, here and here for blogs. For other blog reading on the opinion itself, see here and here.) Having written a bit elsewhere about the logistics of the DC Circuit (see here), I thought I would chime in with specifics about exactly how the decision whether to rehear the case en banc, and en banc rehearing, would work.
Several months ago, I promised to post my thoughts on the viability of the American Hospital Association’s threatened lawsuit against the Secretary of Health and Human Services challenging the growing backlog of coverage appeals. (See my post here). That issue has become timely, because the AHA and several providers filed suit in May in the District of Columbia, and a few days ago filed a motion for summary judgment. (See here). There has been some coverage of the suit. (See here and here.) In short, their argument is that the statute says that a hearing must be held in 90 days and Medicare officials admit that the plaintiffs will not get a hearing for years, so therefore the court should order “mandamus,” forcing compliance with the 90 day deadline.
When I was in practice before moving to academia, I represented the Secretary in cases like this, so keep in mind my view might be biased. But the government’s response to the complaint is due (by my calculation) Monday, July 28, so I wanted to offer my quick reactions about the case and what sort of response we might hear from the government. I’ve just read over the AHA’s motion for summary judgment and I think that in a case like this, with an admitted violation of a statutory requirement, you have to start with the presumption that things could go bad for the government. But with that said, I don’t think that the government’s case is as gloomy as it might at first appear, so this could be an interesting case to watch going forward.
As mentioned in co-blogger Matthew Lawrence‘s prior posts (here) and (here), Medicare’s Departmental Appeals Board (DAB) recently vacated a decades-old National Coverage Determination (NCD) precluding coverage for sex change therapy. That opens the door for Medicare coverage for sex change therapy, but does not guarantee coverage.
In this second blog of a two-part post, we will discuss how we got here: the somewhat unique process taken by the Centers for Medicare & Medicare Services (CMS) to invalidate its old coverage decision.
The decision has a somewhat odd procedural history. On the morning of March 29, 2013, the CMS announced that it was reconsidering the NCD through the formal process for doing so, and sought public comment on what it should do. (See enthusiastic coverage here.) The statutory, public process for reconsideration of an NCD includes the opportunity for comment and so on, analogous to notice and comment rulemaking. And the ultimate decision is subject to judicial review. (See here for more on the NCD process.) The NCD reconsideration process could have not only vacated the old standard, but offered specific standards to govern coverage across claimants (and thereby avoided some of the limbo discussed in our last post).
But on the night of March 29, 2013, the CMS rescinded its call for public comment, saying that it would instead allow a “just filed” appeal challenging the NCD before the DAB to proceed. (See here.) The DAB process is more adversarial and pits a single beneficiary challenging CMS policy in his or her case against the CMS. (Although there are opportunities for amici to participate. In this case, six amici participated, and all of them argued that the ban was unlawful.) The CMS went on to decline to defend the policy, which made the ultimate DAB decision vacating the (undefended) policy unsurprising.
We can’t say why the CMS chose to rescind the reconsideration process rather than push for the individual appeal before the DAB to be held in abeyance pending the outcome of the reconsideration. (In federal court, the doctrine of “ripeness” would have made the pendency of the NCD reconsideration grounds for dismissal of the individual appeal.) And for transgender persons seeking coverage, the process by which their cause was furthered is surely of little moment. But we can’t help but note that, for better or worse, proceeding through the DAB rather than the formal NCD reconsideration process meant less public attention on the proceeding, and less opportunity for comment by interested groups.
Last month Medicare’s policy on coverage for sex change therapy changed somewhat. (See Matt’s earlier post here.) Specifically, Medicare’s Departmental Appeals Board invalidated the long-standing National Coverage Determination that dubbed sex change therapy to be non-covered, per se.
Co-blogger Elizabeth Guo and I have done some further digging on this issue and put together two posts answering some questions left open by Medicare’s decision and the news coverage surrounding it. In this post we discuss next steps: what the change in coverage policy means for Medicare beneficiaries who want coverage for sex change therapy, and what, if any, additional developments are likely to follow. In a companion post, we will be discussing the somewhat unusual process that was used to make this policy change.
Yesterday, Medicare’s Departmental Appeals Board set aside a thirty-year-old National Coverage Determination excluding Medicare coverage for sex change surgery. As a result, Medicare beneficiaries may now seek coverage for sex change surgery, though the ruling does not make such coverage automatic; it only lifts the blanket national exclusion. Regional and case-by-case determinations that such surgery is not “medically necessary” could still apply. For news coverage, see here, here, and here.
The decision is not entirely surprising, Medicare had already in December reopened consideration of the National Coverage Determination precluding coverage. One question to watch is whether this decision, and the changed Medicare policy that ultimately results from it, winds up furthering the case for coverage in private insurance. There is an unmistakable trend in this area toward more coverage. Connecticut recently mandated coverage for many plans, and California and Oregon expanded coverage last year. And let’s not forget prison, in the First Circuit, at least, the refusal to provide sex change surgery to Michael Kosilek that doctors deemed to be medically necessary was ruled “cruel and unusual punishment.” (Coverage in the Globe here.)
At the same time that wait times at VA hospitals have been in the news here in the U.S., a recent report has put healthcare queues in the news in Canada. Specifically, a recent report from the Fraser Institute (a research institute that I’ve seen described as “conservative” and “pro-free market“) concluded that 44,723 women in Canada died between 1993 and 2009 due to increased wait times–or 2.5% of all female deaths during that period. One week of delay was equated with 3 extra deaths per 100,000. That surprising result led to a good bit of coverage, which is how it came across my desk (thanks to a google news search). (See here, here, and here.) But I have to admit I am a little bit skeptical.
Alexis Shapiro is a 12 year old girl who started gaining weight uncontrollably due to a rare condition caused by damage to her brain during the removal of a brain tumor. Her and her parents’ struggle to get her gastric bypass surgery to curb the weight loss made national news for much of the winter in several outlets. Happily, in March she had the surgery and she now appears to be doing well. A good outcome, but boy was the process by which we got here a painful one, largely because the insurer understood the coverage decisionmaking process differently than the rest of us. Here’s a timeline, and some reflections: Continue reading →
Every year, in order to prevent a statutorily-triggered decrease in physician reimbursements under Medicare, Congress must adjust the statutorily-prescribed fee schedule. This is known as the “doc fix.” The American Medical Association, for what it is worth, has lobbied for a permanent doc fix, but that has not happened yet.
This year’s automatic pay cut was going to be 24%, and for a moment a temporary fix was in doubt because of bipartisan support for a permanent fix. But thanks to some procedural maneuvering yesterday, it looks like a temporary doc fix is through the house, at least. (See coverage in Politico here and Washington Post here. And just for fun, see a show about getting things through the house with procedural maneuvering here.)
In addition to the doc fix, a provision included in the House bill would forbid the Department of Health and Human Services from conducting post-payment review through Recovery Audit Contractors of inpatient hospital admission until March 31, 2015. This will stop for at least a year a review program that, in its last full year of operation, returned to the Medicare trust fund (and took away from hospitals) billions of dollars. (See commentary condemning the delay here and commentary criticizing the Recovery Audit Contractor program here.) It’s a notable development and if passed will kick the can down the road a short ways for Medicare to decide how it wants to handle utilization review in this area.
Yesterday the HHS Office of Medicare Hearings and Appeals (OMHA) held a forum for appellants affected by its decision, which I blogged about last month, to hold off on assigning incoming appeals to ALJs while they work to clear a large backlog. I was able to go, and enjoyed every minute. This issue has received its share of attention in the news (Washington Post here, National Review online here), as well as controversy (see here and here), but I have not yet seen an article discussing some of the policy developments that came out of yesterday’s forum. So I am going to play journalist for a minute, rather than academic, and share yesterday’s developments. There were a lot of them: Continue reading →
When Medicare refuses to cover a treatment (such as inpatient hospitalization) or device (like diabetes testing supplies), the statute gives the disappointed beneficiary the right to appeal. Furthermore, there are mechanisms by which the provider–which may be a hospital, doctor, durable medical equipment manufacturer, etc.–that recommended the treatment (and often stands to profit if it is covered) can appeal on the beneficiary’s behalf (or on their own if the claim is assigned).
The statute sets deadlines for decisions on appeal, but in recent years a flood of new cases has led to a growing backlog and long delays. (The backlog is caused in large part by the Recovery Audit Contractor program, through which Medicare has been revisiting and revising coverage determinations from the past several years. That is a subject for another day.)
On Christmas Eve, the office in the Department of Health and Human Services responsible for hearing appeals (that is, the Office of Medicare Hearings and Appeals), adopted a controversial mitigation measure: They’ve stopped hearing new appeals, while they work to clear the backlog. Which will take at least two years. (See recent coverage here.)
Yes, the law says that Medicare must hear appeals, so yes, this temporary measure is technically inconsistent with the law (which is not to say it is illegal, more below on that). But in my view it is actually a good idea, and consistent with what I think is the best ultimate solution to the “backlog” problem. Here’s why:
Over the holidays, a dispute about whether to withdraw life-sustaining treatment between the family of Jahi McMath, a young girl pronounced brain dead by doctors after routine tonsil surgery, and her hospital reached state and federal court and began to receive national attention. (See coverage on CNN here, Fox News here, ABC News here, NY Times here.)
Just a quick flag and comment on the latest development: that a federal magistrate judge, Donna Ryu, has ordered the hospital and family into court tomorrow morning for settlement talks. Meanwhile, suits are pending simultaneously in state court and before a federal judge. While the parties have already engaged in extensive discussions, sometimes a judge can lead parties to agreement where one seemed impossible. I’m still reviewing the case but will follow up if I have anything to add to the news coverage that comes out in the coming days.
Meanwhile, for further scholarly reading on this subject generally, see Glenn Cohen’s 2004 paper in the Harvard Negotiation Law Review.