A Mixed Message on Obamacare from Two Federal Circuits

By Greg Curfman and Holly Fernandez Lynch

It was as if lightning had struck twice in the same place.

On Tuesday two pivotal federal circuit court opinions that could dramatically impact the future of Obamacare were unexpectedly issued within hours of each other. And what’s more, the two opinions reached opposite conclusions on the same question, setting the stage for further appeals and possible Supreme Court review, potentially bringing the Affordable Care Act (ACA) before the high court for the third time since its passage.

At issue in both circuit court cases was the legality of providing subsidies in the form of Internal Revenue Service tax credits for the purchase of health insurance on the federal exchange (Healthcare.gov).

In a decision that stunned Obamacare supporters–but elated opponents–a three-judge panel of the Federal Appeals Court for the DC Circuit ruled in Halbig v. Burwell that the purchase of health insurance on the federal exchange may not be subsidized by IRS tax exemptions. This judgment would leave millions of Americans with earnings between 133% and 400% of the federal poverty level without affordable health insurance, and it would also threaten the viability of the employer mandate.

In contrast, in a unanimous (3-0) opinion in a nearly identical case, King v. Burwell, the Federal Appeals Court for the Fourth Circuit in Richmond, VA, came to the opposite conclusion.

Continue reading

Don’t Buy the Cooperative-Federalism-Makes-Halbig-Logical-Argument

By Abbe Gluck

Cross-posted at Balkinization and Election Law Blog

I had hope to take a day off blogging about Halbig and King (the ObamaCare Subsidies cases), but I cannot allow another new, and inaccurate, narrative about ObamaCare to take hold. Over at Volokh, Ilya Somin argues that the holding in Halbig is not absurd because Congress uses statutory schemes all the time that try to incentivize states to administer federal law (and penalize them if they don’t).  It is true we see schemes like that all the time–Medicaid is a prime example–but the insurance exchange design at issue in these cases is NOT one of them.  This federalism argument was made before the D.C. Circuit and even Judge Griffith didn’t buy it in his ruling for the challengers.  I tried to dispel this myth back in March, when I wrote the following on Balkanization. As I said there, this isn’t Medicaid—it’s the Clean Air Act.

Continue reading

Obama Administration to Revise Contraceptives Coverage Accommodation

In response to the SCOTUS decision granting Wheaton College a preliminary injunction against having to comply with the terms of the HHS accommodation available to non-profit religious organizations who object to covering contraceptives for their employees (i.e., submitting a form to their insurance providers), the Obama Administration has announced that it will revise the terms of that accommodation. Instead of requiring objecting employers to provide the form and notice to insurers or third party administrators of self-insured health plans so that they can jump in to provide free coverage directly to employees, HHS will issue new regulations in short order, the details of which remain to be worked out, but will likely allow nonprofit institutions to write a letter stating their objections, rather than filling out the form (see the WSJ story here). This will leave the government to make sure employees are not left without contraceptives coverage.

I may be oversimplifying things, but I think this extended accommodation really isn’t such a big deal.  It seems to just add the government in as a middleman between the objecting employer and the insurer or third party administrator that was responsible for providing coverage under the original accommodation.  In other words, before, nonprofit religious employers with an objection had to fill out the form and give it directly to their insurers; after the modification, those employers could just let the government know, and presumably the government will notify their insurers.  A bit more bureaucracy, but shouldn’t be too big of a problem – probably just a drop in the bucket of the massive ACA bureaucracy, and potentially unnoticeable by the women seeking free contraceptives.  That is unless the employers claim that even this approach leaves them complicit in violation of their religious beliefs.

Since SCOTUS’s substantial burden test as applied in Hobby Lobby focused on the hefty fines for noncompliance, rather than the extent to which the employers’ religious beliefs were directly v. indirectly burdened, the complicity point is an important one to keep an eye on.  Will religious employers be satisfied with simply adding another link to the causal chain?  Perhaps (and I hope).  Technically, all they would be asked to do is announce to the world that they have a religious objection.  What the government does with that information is beyond their control.  If this works out, the revised accommodation could also be extended to the closely held for-profit corporations with religious objections to contraceptives coverage that SCOTUS determined could not be forced to comply with the mandate, such that their employees too could retain access.

So let’s see what HHS can come up with.  Haters gonna hate, as they say, so I’m sure there will be more litigation on this, but hopefully we’re nearing a solution – and I think a good compromise.  The bigger issue will be dealing with all those other services that must be included as essential benefits or preventive services to which religious employers may object, and to which insurers are likely to object to providing free coverage.  But let’s see if the ACA lives to die another day after Halbig and King.

Big Data, Predictive Analytics, Health Care, Law, and Ethics

Update: The Moore Foundation has generously paid to make my article available as open access on their website here. Today I am speaking at Health Affairs’ “Using Big Data to Transform Health Care” in DC, that will also launch its new issue devoted to the topic. I have a co-authored paper in the volume entitled “The Legal And Ethical Concerns That Arise From Using Complex Predictive Analytics In Health Care” that has just been released. Ironically the article is behind a paywall (while data wants to be free, I guess big data is different!) Here is the abstract.

Predictive analytics, or the use of electronic algorithms to forecast future events in real time, makes it possible to harness the power of big data to improve the health of patients and lower the cost of health care. However, this opportunity raises policy, ethical, and legal challenges. In this article we analyze the major challenges to implementing predictive analytics in health care settings and make broad recommendations for overcoming challenges raised in the four phases of the life cycle of a predictive analytics model: acquiring data to build the model, building and validating it, testing it in real-world settings, and disseminating and using it more broadly. For instance, we recommend that model developers implement governance structures that include patients and other stakeholders starting in the earliest phases of development. In addition, developers should be allowed to use already collected patient data without explicit consent, provided that they comply with federal regulations regarding research on human subjects and the privacy of health information.

I will also have a related paper on mobile health coming out later this summer that I will blog about when it comes out…

An Autism Diagnosis: Still the Key to Unlocking Needed Services?

By Kate Greenwood

Cross-Posted at Health Reform Watch

In a recent, very moving, post about her son’s diagnosis with autism at age eight, blogger Amy Storch writes: “I guess I should mention the obvious — district services for Autism are much more comprehensive than ADHD.” An autism diagnosis should not, as a matter of law, be the key that unlocks needed special education services. Both autism and ADHD “count” as disabilities under the Individuals with Disabilities Education Act (the relevant regulation is here), and the Act provides that a child with either diagnosis who needs special education services is entitled to an educational program “designed to meet their unique needs.” As a matter of fact, though, an autism diagnosis may mean—as it apparently does in Storch’s school district—a more comprehensive program. An autism diagnosis can also be the key to getting necessary services outside of the school setting, through private health insurance.

According to the advocacy group Autism Speaks, 37 states plus the District of Columbia and the United States Virgin Islands have enacted laws requiring state-regulated private health insurance plans to pay for applied behavior analysis and other therapies children with autism often need. As I blogged about previously here, some of these state insurance mandates are relatively broad—New Jersey’s law requires private insurers to cover applied behavior analysis for children with autism, but also to cover occupational, physical, and speech therapy for individuals with “autism or another developmental disability.” Other states’ mandates, however, are strictly limited to children on the autism spectrum. Daniela Caruso of Boston University School of Law writes about Florida’s decision to limit its insurance mandate to children with autism here, attributing it at least in part to advocates’ success persuading legislators to view autism through a “dual frame of beauty and invasion.”

The Patient Protection and Affordable Care Act’s requirement that individual and small group health insurance plans cover ten essential health benefits, and in particular its requirement that plans cover “rehabilitative and habilitative services and devices,” promised to ease access to applied behavior analysis and other therapies often needed by children by autism. Habilitative care is left undefined in the statute, but it is defined at HealthCare.gov as “[h]ealth care services that help you keep, learn, or improve skills and functioning for daily living,” for example “therapy for a child who isn’t walking or talking at the expected age.”

There is a wrinkle, however. Continue reading

Using Big Data To Transform Care: A Briefing on the July 2014 Special Issue of Health Affairs

HealthAffairsJournal

Register online now!

The application of big data to transform health care delivery, health research, and health policy is underway, and its potential is limitless.  The July 2014 issue of Health Affairs, “Using Big Data To Transform Care,” examines this new era for research and patient care from every angle.

You are invited to join Health Affairs Editor-in-Chief Alan Weil on Wednesday, July 9, for an event at the National Press Club, when the issue will be unveiled and authors will present their work.  Panels will cover:

  • Using Big Data At The Point Of Care
  • Research Issues
  • The Role Of The Federal Government
  • Obstacles/Challenges Of Using Big Data

Among the confirmed speakers are:  Continue reading

Medicaid ACOs in New Jersey: At the Starting Line at Last

By Kate Greenwood

Cross-Posted at Health Reform Watch

Nearly three years ago, in July of 2011, Tara Adams Ragone wrote a blog post for Seton Hall Law’s Health Reform Watch blog entitled “Community Based Medicaid ACOs in New Jersey: A Signature Away”. As Professor Ragone explained, a month earlier the New Jersey legislature had passed Senate Bill 2443, which established a Medicaid accountable care organization (ACO) demonstration project, but Governor Chris Christie had not yet signed it. “It’s an exciting time for growth and innovation in the Garden State,” Professor Ragone wrote, “if we just get that signature.”

Governor Christie did go on to sign Senate Bill 2443 into law, in August of 2011, but the implementation process has been protracted. The act required the Department of Human Services to “adopt rules and regulations” that provided for oversight of the quality of care delivered to Medicaid recipients in the ACOs’ designated geographic areas and set standards for the gainsharing plans that participating ACOs must develop. The deadline for adopting the regulations was in June of 2012, but they were first issued, in draft form, in May of 2013. The final regulations were not adopted until earlier this week, one day before the proposed regulations were due to expire.

As Andrew Kitchenman reports here, with the regulations in place, the three community-based organizations that have been preparing to launch Medicaid ACOs, one in Camden, one in Trenton, and one in Newark, can finally get started. Unlike the State, they will have to move quickly; the deadline for applying to participate in the three-year demonstration is July 7th.

There is, in Kitchenman’s words, “a final piece to the puzzle”—the participation of managed care organizations (MCOs). Continue reading

#BELHP2014 Panel 3, Behavioral Economics and Health Care Costs

[Ed. Note: On Friday, May 2 and Saturday, May 3, 2014, the Petrie-Flom Center hosted its 2014 annual conference: "Behavioral Economics, Law, and Health Policy."  This is an installment in our series of live blog posts from the event; video will be available later in the summer on our website.]

Our third panel, moderated by PFC Academic Fellow Matthew Lawrence, addresses the use of behavioral economics techniques to control health care costs.  Speakers are Christopher T. Robertson, Brigitte Madrian, Ameet SarpatwariAnupam Jena, and Jim Hawkins.  (Many projects are co-authored, but I’m only listing the presenters here)

The first speaker is Professor Christopher T. Robertson, coming from Arizona Law but visiting Harvard and the PFC this year, speaking on Cost-Sharing as Choice Architecture.  He starts by talking about the cost side of cost sharing, which we know works in reducing consumption from empirical evidence; from the RAND study, it reduced use without reducing health.  More recent studies also confirm this.  But cost sharing presents four problems:

  1. Underinsurance relative to ability to pay
  2. Indiscriminate reductions in health care (more of an ax than a scalpel)
  3. An unfair tax on sickness (more tentative if we can solve the first two)
  4. The burden of deciding.

Continue reading

FRIDAY & SATURDAY: Petrie-Flom Center Annual Conference, “Behavioral Economics, Law, & Health Policy”

Petrie-Flom Center 2014 Annual Conference: Behavioral Economics, Law, and Health Policy

May 2-3, 2014

Wasserstein Hall, Milstein East ABC, Harvard Law School, 1585 Massachusetts Ave.

Richard H. Thaler and Cass R. Sunstein’s book  Nudge: Improving Decisions About Health, Wealth, and Happiness brought behavioral economics to the masses, beginning a discussion of libertarian paternalism and the many ways that “choice architects” can help nudge people to make better choices for themselves without forcing certain outcomes on anyone. Some of their examples fall in the realm of health policy, as is also the case of Daniel Kahneman’s recent book, Thinking, Fast and Slow, which examines various cognitive errors people make in their judgments, choices, and conclusions, as well as how we might correct them.  But the conversation has only just begun.

Continue reading

How should we label these “cognitive errors” that are particularly common among MDs?

Behavioral economists are really into giving the cognitive errors they study, and the corrective policy interventions they favor, labels. “Status quo bias,” “availability bias,” “recall bias,” etc., can all be fixed through “nudges” that involve “asymmetric paternalism” and the like.

Here’s an interesting “cognitive error” that I’m trying to crowd-source a label for: When America’s joint surgeons were challenged to come up with a list of unnecessary procedures in their field, their selections shared one thing: none significantly impacted their incomes.

And here’s another odd cognitive anomaly that seems to be especially limited to ophthalmologists: forgetting there’s a $50 dollar alternative that works just as well as the $2,000 injection they get 6% commission on. 

I’ve thought of my own labels (or rather, euphemisms) for the policy interventions I would suggest in response: “continuing medical education”  for the first of these neat little errors, and “resocialization” for the second.

5/2-3: Petrie-Flom Center Annual Conference, “Behavioral Economics, Law, and Health Policy”

Petrie-Flom Center 2014 Annual Conference: Behavioral Economics, Law, and Health Policy

May 2-3, 2014

Wasserstein Hall, Milstein East ABC, Harvard Law School, 1585 Massachusetts Ave.

Richard H. Thaler and Cass R. Sunstein’s book  Nudge: Improving Decisions About Health, Wealth, and Happiness brought behavioral economics to the masses, beginning a discussion of libertarian paternalism and the many ways that “choice architects” can help nudge people to make better choices for themselves without forcing certain outcomes on anyone. Some of their examples fall in the realm of health policy, as is also the case of Daniel Kahneman’s recent book, Thinking, Fast and Slow, which examines various cognitive errors people make in their judgments, choices, and conclusions, as well as how we might correct them.  But the conversation has only just begun.

Continue reading

Book Review published on SSRN

Three weeks ago I blogged about my recent review of  “Pharmaceutical Innovation, Competition and Patent Law – a Trilateral Perspective” (Edward Elgar 2013). The full review, which is forthcoming in a spring issue of European Competition Law Review (Sweet Maxwell), is now available at SSRN: http://ssrn.com/abstract=2396804.

News from OMHA Appellants Forum: Statistical Sampling Coming, Backlog Growing

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

The AOL Babies: Our Healthcare Crisis in a Nut

By Nicolas Terry

Cross-posted from HealthLawProf Blog.
Where does one start with AOL CEO Armstrong’s ridiculous and unfeeling justifications for changes in his company’s 401(k) plan. Cable TV and Twitter came out of the blocks fast with the obvious critiques. And the outrage only increased after novelist Deanna Fei took to Slate to identify her daughter as one of the subjects of Armstrong’s implied criticism. Armstrong has now apologized and reversed his earlier decision.
As the corporate spin doctors contain the damage, Armstrong’s statements likely will recede from memory, although I am still hoping The Onion will memorialize Armstrong’s entry into the healthcare debate (suggested headline, “CEO Discovers Nation’s Healthcare Crisis Caused by 25 Ounce Baby”). But supposing (just supposing) your health law students ask about the story in class this week. What sort of journey can you take them on?

Treating Addiction in Pregnant Women and New Mothers: A Promising Application for Social Impact Financing?

By Kate Greenwood

Cross-Posted at Health Reform Watch 

Last week, vtdigger.org ran an interesting article by Laura Krantz on the difficulties pregnant women and new mothers who are addicted to drugs have accessing not just drug treatment but also all of the other services and supports they need. Krantz reported on a hearing before the Human Services Committee of the Vermont House of Representatives at which a new mother in recovery from addiction, “a neonatalogist, a substance abuse clinician, a Health Department employee and a representative from the Phoenix House, a residential treatment facility in Brattleboro … all said women need not only treatment, but housing, transportation and help finding jobs.”

Alice Larned, a substance abuse clinician at the Lund Family Center in Burlington, told Krantz that spaces in residential detoxification facilities are increasingly scarce. The demand for transitional housing for women who have completed inpatient detoxification also exceeds the supply. Add to this the sad fact that women can wait a year or more for an appointment with a physician who can treat them with methadone or buprenorphine. Larned told Krantz that many of the women who start treatment with her are taking buprenorphine they bought illegally, an “indication they want help ‘yet we don’t have the legitimate means for them to get this medication[.]’”

In another story that ran last week on NPR, Steve Zind spoke with Harry Chen, the Commissioner of the Vermont Department of Public Health, who emphasized the complexities inherent in treating addiction in pregnant women and new mothers. To do so successfully, Commissioner Chen explained, “requires so many different systems working together well: the social service system, the health care system, the substance abuse system and even to some extent the correctional system.”

I confess that one reason that these two articles caught my attention is that Alice Larned is my sister.  Another reason, though, is that the problem described in the articles seems like a promising application for social impact financing, something that has been in the news here in New Jersey in recent weeks.

Continue reading

Encouraging Innovation in Chronic Care Management

By Michael Young

The growing burden of managing chronic illness has long been a critical issue for policy makers and clinicians seeking to improve the quality, cost and efficiency of healthcare systems in the United States. According to the Institute of Medicine, the costs of treating and managing the segment of the population living with chronic illnesses currently represents nearly $1.5 trillion of the over $2 trillion in annual healthcare spending in the U.S.  Over 90% of Medicare costs are allocated to beneficiaries living with two or more chronic conditions, with close to 50% of spending on individuals living with 6 or more chronic conditions (approximately 14% of beneficiaries).  The immense share of healthcare spending attributable to chronic illness is expected to climb as the population ages. 

Earlier this month, a bipartisan bill entitled the Better Care, Lower Cost Act was introduced in Congress which aims to address the complex issues involved in chronic care management.  The legislation outlines three key innovations toward this end.

Continue reading

Medicare Stops Hearing Provider Appeals in Hopes of Clearing Backlog

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:

Continue reading

Capturing Value in Advanced Medical Imaging

On December 12, a bipartisan bill entitled the Excellence in Diagnostic Imaging Utilization Act of 2013 (HR 3705) was introduced in the House of Representatives which would require clinicians to use electronic clinical decision support tools (CDS) before ordering advanced diagnostic imaging tests for Medicare patients.  Structured around appropriate use criteria  developed by professional medical societies, the tools would aim to increase the value of advanced imaging studies by informing and guiding practitioners’ decisions across a variety of clinical settings.

Such tools would provide active feedback on the appropriateness and evidence base of various imaging modalities, and would require physicians to furnish rationales for ordering tests that are inconsistent with appropriate use criteria.  The bill also envisions the creation of registries that document how diagnostic tests are used in order to facilitate research and to enable feedback to clinicians on metrics related to appropriate use criteria.  In a press release, the American College of Radiology lauded the proposed legislation, stating that it would “revolutionize the specialty of radiology.”

Mandating the use of electronic clinical decision support tools portends at least three key improvements in clinical workflows and healthcare quality more broadly.

Continue reading

Sleep versus Training: The NY Times on Surgical Work Hours

Pauline Chen at the NY Times Blog has an article on cut backs on the number of hours of training for young surgeons.

According to her story:

“For the past decade, in response to increasing pressure from politicians, unions and sleep experts, the Accreditation Council for Graduate Medical Education, the organization responsible for accrediting American medical and surgical training programs, has been working to cap the hours that residents work. In 2011 the council passed the strictest limits yet. To maintain their accreditation, residency training programs had to abide by a 22-page set of scheduling rules that limited all in-hospital work including any elective “moonlighting” jobs to 80 hours per week, mandated the number of hours “free of duty” after different “duty periods” (eight hours off after 16-hour duty periods and 14 hours off after 24-hour duty periods) and even specified the timing of “strategic napping” in no uncertain terms (after 16 hours of continuous duty and between the hours of 10 p.m. and 8 a.m.).

While most residency programs chafed under the exhaustively detailed regulations, surgical training programs had particular difficulty adopting the new mandates. For nearly a century, surgical residency had been a period of both intensive experience and increasing responsibility under the guidance of more experienced surgeons. More recent research has affirmed that approach, demonstrating the strong link between a surgeon’s operative skill, the number of operations performed and patient outcomes. With limits set on their time at the hospital, young surgeons-in-training had fewer opportunities to care for patients or scrub in on operations. While previous generations of trainees had the luxury of participating in at least one operation a day, new trainees had only enough time to be involved in two or maybe three operations each week.

Calculating the number of hours “lost” by cutting back on in-hospital time, surgical leaders estimated that young surgeons-to-be were now missing out on as much as a year’s worth of experience”

She relies heavily on an new Annals of Surgery Article, wherein, as Chen reports,

“Researchers sent questionnaires to the directors of subspecialty fellowship training programs and asked them to comment on the bedside and operating skills of the young surgeons enrolling in their programs. These fellowships are a kind of high-level and often prestigious surgical “gap year” where young surgeons who have completed the basic five-year surgery residency can delay independent practice to pursue an additional year or two of training.

The results were abysmal. Fewer than half of the young surgeons could operate or make clinical decisions on their own. Nearly a third of them were incapable of performing even the most basic operations like a gallbladder removal on their own. And a quarter were unable to recognize the early signs of complications.

Even in areas of surgery where the young surgeons had had supplementary online learning modules during their residency, they performed poorly, with more than half unable to perform basic maneuvers.”

While acknowledging that “some observers have criticized the study for being self-serving – most respondents also noted that the young surgeons’ deficiencies resolved after additional training under their auspices —” Chen’s article reads largely as an attack on these new residency work hour rules.

Since I have written on the subject of these residency work hour rules with sleep specialists earlier this year in the Journal of Law, Medicine, and Ethics, it may be unsurprising that I take a somewhat different view.

Continue reading

Managing All Care

By Nathaniel Counts

Health insurers are beginning to realize the importance of downstream cost-saving.  By paying to keep people healthy now, health insurers avoid major expenditures later when they must cover chronic conditions and hospitalizations.  For example, by paying for nutrition counseling and fitness programs for prediabetics, health insurers can reduce the rate of transition to diabetes for their clients, which both saves the insurer thousands of dollars and keeps their clients happier and healthier.   This type of innovation is possible because the law requires certain expenditures, i.e. doctors must treat individuals at the emergency room, and these expenditures tend to be quite large if incurred.

Social services in general could enjoy this type of innovation if funding were pooled between government services, and healthcare, housing, food, and direct welfare were all managed together.  Currently, each is conceived as a separate welfare program, so one can only recognize reduction within a program, not how the programs interact.  For example, it may be that the expansion of SNAP benefits would decrease emergency room visits and end up being cost-saving overall.  It may also be that certain types of subsidized housing reduce the need for other services and are more cost-saving than others, but this is hard to recognize when each program is segregated.  One could imagine that subsidized housing built in areas with better access to quality food and jobs would be more expensive upfront, but could save in money overall by reducing the need for other benefits.  Because social services currently have a system of mandatory spending in the form of entitlements, there is an incentive to ensure that individuals transition away from use of the more expensive services.

Continue reading