Carter's Benefits

eNewsletter Volume 4, Issue 11 November 2011

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Supreme Court Style

The Supreme Court isn’t generally known as the most transparent institution in American politics, but in the last week it has sent a few distinct hints to its observers that it’s very seriously considering whether or not it will hear one or more of the PPACA constitutional challenges during its current term.

Last week, the briefing papers in three of the four pending health care reform cases were sent to all of the justices for detailed review. In addition, the court has set up its own webpage for health reform cases and filing. The court’s own blog cites the webpage as a rare, though not unheard of, move by the high court.

Many believe these efforts are all in preparation for the justices’ private conference on November 10 where they could decide whether to take up the PPACA cases this term and which of the pending cases they will consider. The court could decide to focus on one specific case, or combine the challenges in some way. If the justices do make a decision next week, the court would make the announcement on November 14. The justices could also decide to table the issue until another conference, the next of which is scheduled for November 22.

America’s Health Insurance Plans is one of many groups that would like the high court to hear the PPACA challenge cases right away. The insurer trade association filed an amicus brief with the court last week urging them to consider the issue and also said the court should fully address the question of severability. Since the law does not have a severability clause, some contend that if any part of the law is struck down, then legally the rest of the law should come with it. Others have argued that portions of the law can be removed without affecting the overall legislation. AHIP wrote in its brief that when Congress passed the reform law, there was “powerful proof that decoupling the mandate from those other requirements would destabilize the insurance market throughout the Nation.”

Recent News

  1. HHS Will Not Implement CLASS Long-Term Care Insurance Plan.
  2. Final Rule For ACOs Receives Positive Reviews.
  3. HHS Seeking Input On Structuring Essential Health Benefits.
  4. Kaiser Poll Shows Lowest Level Of Health Reform Support.
  5. More Employers, Insurers Offer Incentives To Lead Healthier Lives.
  6. HHS Unveils Web Page On Health Insurance Rates.
  7. Texas Healthcare Providers Experimenting With New Payment, Care Methods.
  8. Healthcare Focused On Efficiency Could Save Billions, Blue Cross Report Says.
  9. Top Unnecessary Healthcare Cost Related To Brand-Name Statins.
  10. Kaiser Family Foundation Releases New Data on Employer-Sponsored Coverage Trends

HHS Will Not Implement CLASS Long-Term Care Insurance Plan
There was widespread television and print media coverage of an announcement by the Obama Administration that it would not implement a health reform provision called the Community Living Assistance Services and Supports program, or CLASS. Sources portrayed the decision as a blow to the Administration and the law. FOX and Friends (10/15, 8:30 a.m. EST, 1,165,673) reported that the "White House announced it will not move forward with" the CLASS program, "a key program in the president's health care overhaul." HHS Secretary Kathleen Sebelius informed "Congress it could not be implemented in time. This program was expected to launch next year," but was "said to have design and financial problems."
The AP (10/14, Alonso-Zaldivar) reported that HHS has "pulled the plug on a major program in the president's signature health overhaul law -- a long-term care insurance plan dogged from the beginning by doubts over its financial solvency." This program, "targeted by congressional Republicans for repeal," became "the first casualty in the political and policy wars over the healthcare law. It had been expected to launch in 2013." Sen. John Thune, who led opposition to CLASS in the Senate, said, "This is a victory for the American taxpayer and future generations."
Bloomberg News (10/15, Wayne, Armstrong) reported HHS said CLASS is "financially unsustainable." In a letter to congressional leaders, HHS Secretary Sebelius said, "I do not see a viable path forward for Class implementation at this time." CLASS "had been championed" by Sen. Edward Kennedy "before his death," but Republicans "called it an accounting gimmick whose premiums would be used to pay for other parts of the law and said Democrats vastly underestimated its future costs."
The New York Times (10/15, A10, Pear, Subscription Publication) said the decision "was another setback for the new law, which is under attack in court, in Congress and in many state legislatures." Sebelius "said her decision 'does not affect the rest of the healthcare law,' which is supposed to provide coverage to more than 30 million people who are uninsured." The Los Angeles Times (10/15, Levey) also said the move "will not affect other parts of the sweeping law, including preparations for a major expansion of health insurance coverage starting in 2014, according to administration officials."
The Wall Street Journal (10/15, Radnofsky, Subscription Publication) reported CLASS had been projected to generate billions in revenue early on, but its long-term obligation to meet claims payments was seen as problematic. Senate Minority Leader McConnell said, "The Obama Administration today acknowledged what they refused to admit when they passed their partisan health bill: The Class Act was a budget gimmick that might enhance the numbers on a Washington bureaucrat's spreadsheet but was destined to fail in the real world."
The Washington Post (10/15, Aizenman) said while CLASS "had been dogged from the start by doubts about its feasibility, its elimination marks the first time the administration has backed away from a key piece of President Obama's signature legislative achievement."
CQ (10/15, Ethridge, Subscription Publication) reported, "Many Democrats signaled they intend to try to devise a workable and affordable alternative to address the costs of long-term care, while Republicans used the announcement to revive their calls to repeal last year's health care law." GOP lawmakers "said shelving the program was insufficient and called on Congress to vote to repeal the program, a proposal that could allow the GOP to re-open the larger health care overhaul debate." In addition, "House Republicans wasted no time in scheduling an Oct. 26 hearing of two Energy and Commerce panels to explore the cancellation of the program and its effect on the deficit."
        More Commentary. A Wall Street Journal (10/15, Subscription Publication) editorial welcomed the announcement that the Department of Health and Human Services will close one of the Affordable Care Act's major new entitlement programs. The editorial saw HHS Secretary Kathleen Sebelius' decision to shut down the office in charge of creating the insurance program for long-term care as an admission that the Obama Administration's claim that the program would help to reduce the deficit reduction was a fantasy. According to the editorial, Democrats had finagled the figures during the healthcare debate to make it appear as if the program could reduce the deficit, but the program's killing proved that the numbers had always been an illusion.

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Final Rule For ACOs Receives Positive Reviews.
CQ (10/22, Reichard, Subscription Publication) reported, "Federal officials have come a long way in refashioning a pivotal regulation to spur doctors and hospitals in traditional Medicare to form closely knit health care teams." Criticized "by Republicans as 'unworkable,' a 'flop' and even a 'debacle,' the initial rule" for accountable care organizations (ACOs), "floated in March, was overhauled to heed the concerns of critics." Centers for Medicare and Medicaid Services Administrator Donald M. Berwick released the final rule on Oct. 20. It "drops dozens of proposed requirements and gives strapped doctors and rural hospitals millions of dollars in up-front capital. The result: Medicare's actuary doubled his estimate of how many provider groups will sponsor team-based care."
        ACA's Attempts To Control Medicare Costs Discussed. Part two of a CNNMoney (10/22, Regnier) series on Medicare discussed how the healthcare law attempts to control the program's rising costs. First, the law "cut $500 billion out of two big Medicare programs over a decade, while increasing the number of high-income retirees who have to pay larger Part B premiums." The law also established "the Independent Payment Advisory Board, or IPAB, experts appointed by the White House to find ways to restrain Medicare spending growth to GDP plus one percentage point." In addition, the Affordable Care Act law "sets up programs that aim at changing financial incentives for providers," such as accountable care organizations. CMS Administrator Donald Berwick noted that the current fee-for-service system helps raise costs, instead of keeping them low

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HHS Seeking Input On Structuring Essential Health Benefits.
CQ (10/19, Norman, Subscription Publication) reports HHS "held a closed-door meeting involving dozens of provider groups airing their views on what should be included in an essential health benefits package," and "meetings with consumer advocates and insurers are expected to follow soon." Now that the Institute of Medicine released its recommendations, HHS must "develop more specific proposals on benefits for plans that will be offered to individuals and small businesses obtaining their care through the state-based exchanges in 2014."
        Pediatricians Push For Wide Essential Benefits Definition. The "Healthwatch" blog of The Hill (10/19, Baker) reports, "The American Academy of Pediatrics (AAP) is testifying Tuesday at a closed-door stakeholder meeting on essential benefits," and it "urge[s] HHS to cast a wide net when defining essential benefits" because "a narrow definition would exclude important children's services." However, other stakeholders "have urged HHS to start small," as each mandate increases premiums "and it's always easier to add a new benefit than remove one." However, AAP argues that children have "unique needs," and, due to Medicaid, "bypassing their needs in the essential benefits package could...simply shift the cost of children's healthcare to the states."

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Kaiser Poll Shows Lowest Level Of Health Reform Support.
The Hill (10/31, Pecquet) reports in its "Healthwatch" blog, "Defenders of the Democrats' health law quickly dismissed Friday's dismal" Kaiser Family Foundation "poll numbers as a statistical fluke that will have little impact to no impact on the 2012 election." The poll "registered the lowest level of support for the law since it was enacted" because of "waning support from Democrats," while "Congressional Republicans embraced the poll as proof their strategy is working."
        Politico (10/31, Millman) reports, "There have been other big shifts in opinion in past Kaiser polls - including a surge in the popularity of the law three months after it passed. But this is the first time the favorable views of the law have trailed the unfavorable views by so wide a margin." The piece notes, "The poll comes in the same week that two progressive groups in Colorado are trying to turn public opinion back in favor of the law."
        The Washington Post (10/28, Kliff) reports in its "Ezra Klein" blog, "The Democrats have always faced a challenge in trying to sway the public on health reform - promoting the Affordable Care Act as transformative and nondisruptive, allowing Americans to keep the coverage they like. As of late, it looks like their base is becoming less convinced that the health reform law will do much to improve what they have now."
        WSJournal Welcomes Declining Popularity Of Healthcare Law. A Wall Street Journal (10/29, Subscription Publication, 2.02M) editorial welcomed a recent Kaiser Family Foundation survey finding declining support for the Affordable Care Act. The Journal attributes the opposition to the rising costs of healthcare, despite President Obama's statement that healthcare reform would lower insurance costs.

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More Employers, Insurers Offer Incentives To Lead Healthier Lives.
The Los Angeles Times (10/25, Helfand) reports, "Growing numbers of employers and insurance companies, stung by continued hikes in healthcare costs, are offering employees money and merchandise to lead healthier lives. Advocates of the approach are betting that preventive action will keep workers productive and hold down healthcare bills for expensive diseases like cancer and diabetes." While "economists say it's too soon to tell whether rewards will be successful in the long run...corporate leaders say the strategy is already paying off by helping to slow the growth of their medical costs."

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HHS Unveils Web Page On Health Insurance Rates.
USA Today (10/7, Kennedy) reports, "Beginning today, consumers across the country can click their state on a federal Web page to see if a health insurer has raised its rates, as well as the company's reason for doing so." HHS Secretary Kathleen Sebelius issued a statement saying, "We are taking a good, hard look at why insurance companies are seeking to raise your rates, why your premiums might be going up, and making sure these decisions are public and justified."

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Texas Healthcare Providers Experimenting With New Payment, Care Methods.
The New York Times /Texas Tribune (10/7, Ramshaw, Subscription Publication) reports, "As the United States grapples with rising health care costs and a system that rewards doctors and hospitals for how sick their patients get, not how healthy they become, Texas health care providers are increasingly experimenting with new payment and care delivery models - joining forces to emphasize efficiency and outcomes." While the idea is not new, "with the rollout of the federal health overhaul, and new Texas legislation tended to pay for performance, not procedures, more Texas providers may join the movement." The Times notes that, "last month, the United States Department of Health and Human Services started a pilot program to pay primary care practices a monthly fee if they provide better chronic-care management, give patients 24-hour access to care and health information, and collaborate with specialists to better coordinate care."

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Healthcare Focused On Efficiency Could Save Billions, Blue Cross Report Says.
Bloomberg News (10/5, Eisenberg) reports, "Shifting the focus of health care to more-efficient service sooner could save the federal government more than $300 billion over 10 years, The Blue Cross and Blue Shield Association said today." The association said in a report that "incentives for quality service and reduced medical errors would eliminate infections and complications that harm thousands of people each year and pare the costs of redundant and unnecessary services." The report also said that "more emphasis on primary care and encouraging healthy lifestyles would also save money, the group said in a report."

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Top Unnecessary Healthcare Cost Related To Brand-Name Statins.
Under the headline "Top 5 Unnecessary Healthcare Costs," Jonathan D. Rockoff writes in the Wall Street Journal (10/5) "Health Blog" that, according to researchers, the top unnecessary cost is doctors prescribing brand-name statins without trying a generic first, which generated $5.8 billion in unnecessary spending. Other top unnecessary costs included prescribing antibiotics to children with a viral infection and overuse of CT scans and MRIs to diagnose lower back pain.

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Kaiser Family Foundation Releases New Data on Employer-Sponsored Coverage Trends

Last week, the Kaiser Family Foundation released its Employer Health Benefits 2011 Annual Survey, which provides a detailed look at trends in employer-sponsored health coverage, including premiums, employee contributions, cost-sharing provisions, and other relevant information. Read More

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How does Carter's Benefits help ?
We continue to stay on top of changes in this industry. In a consultative role, Eddie Carter has begun hosting live seminars to update employers and Human Resource Managers on these changes. If you would like to host a meeting with your local community or civic organization, please contact me for details.

Eddie Carter, Consultant Eddie Carter,
Benefit Consultant
If you have questions or would like more information please give us a call or send us an email.  Our email address is Questions@CartersBenefits.Com

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