Category Archives: Medicare/Medicaid

New Paper on Coercion and the Constitutionality of the Affordable Care Act

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I have a new paper on the Supreme Court’s decision on the Affordable Care Act, just published in the European peer-reviewed philosophy journal Ethical Perspectives. It is available for free download here.  Here is the abstract:

While NFIB v. Sebelius largely upheld the Affordable Care Act (ACA), it did not do so as as to the proposed expansion of Medicaid. Seven of the nine U,S, Supreme Court Justices (all except Justices Ginsburg and Sotomayor) endorsed a ‘coercion’ argument that gave individual States a right of objection grounded in the Constitution’s Spending Clause, wherein individual states could refuse to expand Medicaid as demanded by the federal government without being directly penalized by a denial of federal funding. Two Justices in dissent focused on the lack of judicial administrability of such a standard, and suggested it would open up a Pandora’s box of future constitutional challenges without any clear rules.

In this article, part of a symposium on philosophical analysis of the Court’s decision published in the peer-reviewed journal Ethical Perspectives, I discuss what I see as a more fundamental question: by what theory is the Medicaid expansion coercive, and even if coercive, by what theory is it coercive in a problematic way that justifies constitutional redress?

The Court’s failure to address this issue stems, in part, from confusion over what it means for an offer to be coercive. In some sense, Justice Kagan seemed to recognize this issue in a question to Paul Clement, the lawyer for the challengers to the ACA, at oral argument: “Why is a big gift from the federal government a matter of coercion?” Kagan asked. “It’s just a boatload of federal money for you to take and spend on poor people’s health care,” Kagan added. “It doesn’t sound coercive to me, I have to tell you.” The exchange is all the more curious because, despite her scepticism, Kagan signed on to the Court’s holding that the Medicaid expansion was coercive.

I will examine this issue by first discussing whether Medicaid itself and the ACA’s expansion are coercive (as stand-alone offers). I will then examine whether the offer to change from the existing Medicaid program to the ACA’s Medicaid expansion was problematic. I will analyze these questions under the assumption that the Court is not committing a category error by treating States as the kinds of entities subject to this kind of coercion inquiry. In my conclusion, however, I briefly consider whether that assumption is warranted.

Is Obama Winning or Losing on Medicaid Expansion Under the Affordable Care Act?

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By: Katie Booth

The Obama administration announced in February that it would allow Arkansas to use the federal money intended for Medicaid expansion to buy private health insurance plans for individuals with incomes up to 133% of the federal poverty level. This week, Florida’s senate rejected the Medicaid expansion but left open the possibility that it would try to negotiate a similar deal with the Obama administration. Indiana and Ohio may follow suit.

At first glance, this seems like a political loss for Obama. Several states with Republican governors may now expand healthcare for the poor using a private payer model—the type of model Mitt Romney supported during the 2012 presidential race. Yet Obama’s compromise in Arkansas may ultimately be a win for the president. All of the 14 states that are not participating (as of now) in the Medicaid expansion have republican governors. The private insurer model would allow these governors to save face while ultimately expanding access to healthcare for the poor.

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Time Magazine on Solving Health Care’s #1 Problem: “All the Prices Are Too Damn High”

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By Patrick O’Leary

The cover story of the March 4, 2013 issue of Time Magazine is a piece by Steven Brill titled Bitter Pill: Why Medical Bills Are Killing Us. The article has apparently made a pretty big splash: in an interview (Part 2, Part 3) with Brill last week, Jon Stewart of Comedy Central’s The Daily Show told his audience that the article was so good that it “should be required reading for . . . not only every individual in this country, but lawmaker in this country.”

What most seems to fascinate Stewart, and what Brill emphasizes, is an insight that is old hat to health law types: the market for health care is just plain screwy. Brill explains that health care consumers “have no choice in what you’re buying, you have no idea what you’re buying, you have no idea what the price is, even when you get the bill you have no idea what it says.” The starting point for the article was Brill’s observation that in all the debate over the last few years about health care, “we seem to jump right to the issue of who should pay the bills, blowing right past what should be the first question: Why exactly are the bills so high?” Continue reading →

Impact of the Sequester on Health Care: By the Numbers

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By: Katie Booth 

The looming sequester will have a significant impact on health care, including cuts to Medicare, FDA, CDC, NIH, and Affordable Care Act programs. Budget cuts could slow down the drug approval process, impede the tracking of infectious diseases, and lead to layoffs for hundreds of thousands of workers in the health care sector. Read on for sequestration by the numbers…

Medicare:

  • Medicare cut by 2% ($11 billion) (not set to begin until April 1st, 2013, unlike other sequestration cuts, which are set to begin on March 1, 2013)
  • Physicians’ payments cut by 2%
  • Hospital Medicare reimbursement cut by $5.8 billion
  • Hospitals could end up with especially large cuts under the sequester because other parts of healthcare system run on longer term contracts
  • Loss of almost 500,000 health care sector jobs in the first year of the sequester according to an American Medical Association and American Hospital Association study, including job losses for 40,000 practitioners such as physicians and dentists

FDA:

  • FDA cut by 8% ($318 million)
  • FDA public funding cut by $206 million
  • FDA industry user fees cut by $112 million (for an interesting discussion of user fee cuts and the sequester, see Patrick O’Leary’s Bill of Health blog post)
  • Cuts by department (assuming 8% across-the-board cuts): $71 million to Foods, $39 million to Human Drugs, $17 million to Biologics, $11.3 million to Animal Drugs, and $26.5 million to Devices
  • Longer drug approval process is likely
  • Layoffs and furloughs likely
  • 2,100 fewer food safety inspections

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The ACA’s Immigration Quirk

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I was amused but not surprised to read that in announcing her support for expanding Arizona’s Medicaid program, Governor Jan Brewer pointed to the fact that without the expansion, only non-citizens with incomes under the poverty level would be eligible for insurance under the ACA. What Brewer didn’t say, was that the ACA’s apparent preference for non-citizens results from precisely the type of anti-immigrant laws with which Gov. Brewer is usually associated.

 In 1996, shortly after California passed the notorious Proposition 187 which denied state public benefits to undocumented immigrants, Congress enacted the Personal Responsibility and Work Opportunity Reconciliation Act, better known as the Welfare Reform Act.  Among other things, this law imposes a 5 year waiting period before most legal permanent residents can enroll in the federal Medicaid program. The law also barred many other immigrants who are lawfully residing within the U.S. from Medicaid altogether.

The ACA did not repeal the provisions in the Welfare Reform Act limiting immigrants’ access to Medicaid. Instead, Congress sought to provide coverage to lawfully residing immigrants by permitting those with incomes under 100% of the Federal Poverty Level to receive subsidies to purchase insurance on the exchanges. Those subsidies were not necessary for citizens with such low incomes because Congress assumed that they would be brought into the Medicaid program.

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Twitter Round-Up (1/20-1/26)

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By Casey Thomson

Though simply the consequence of bad translation, the story of the Harvard geneticist George Church looking for a woman to act as surrogate for a Neanderthal clone shocked the internet bioethics world. A look at the problems with this hypothetical situation is just one of the components of this week’s Twitter Round-Up.

  • Frank Pasquale (@FrankPasquale) linked to an opinion piece discussing the reasoning behind the United States’ place in the world rankings of life expectancy at different stages of life. The news is a big hit to ideas of American exceptionalism: according to a report by the National Research Council and the Institute of Medicine, Americans have a substantially higher death rate for those younger than 50 as compared to Western Europeans, Canadians, Japanese, and Australians, but once they reach the age of 80, they have some of the longest life expectancies globally. (1/20)
  • Arthur Caplan (@ArthurCaplan) shared his article on why Neanderthal cloning is a bad idea, both in terms of safety and in terms of avoiding cruelty. (1/22)
  • Arthur Caplan (@ArthurCaplan) posted a news story on the reopening of bird flu experimental procedures for vaccine creation. Caplan was quoted in the article as stating: “I have no issue with restarting the research but some issue with where they are going to publish it and where they present it because bad guys can use it too.” (1/23)
  • Daniel Goldberg (@prof_goldberg) included an evaluation as to the medical disparities occurring in Colorado, particularly between races. The article emphasized in its conclusion that the existence of the disparities themselves is quite clear, but discussion on how to erase such differences is noticeably absent. (1/23)
  • Michelle Meyer (@MichelleNMeyer) retweeted a post that attempted to quantifiably compare the quality of care in Medicare options, namely whether Medicare Advantage plans 1) will eventually shortchange patients by skipping out on care quality because of profit motive or 2) have incentives to improve care quality because of the newly implemented systematic quality monitoring, where poor ratings impact them financially. The author found that most existing data makes the second theory more compelling, though the amount of data regarding the subject in general is largely lacking. (1/24)
  • Michelle Meyer (@MichelleNMeyer) also shared a link to an explanation of the intricacies of “personalized regulation” in medicine, which aims to preserve patient choice in an era leaning more and more towards paternalistic medical oversight. Understanding that patients may choose to make rational decisions that diverge from the community or committee consensus is key towards improving medical care to better reflect patient wants, and rights. (1/24)
  • Arthur Caplan (@ArthurCaplan) included a story on the large imbalance in misconduct reports in research between the genders. Men overwhelmingly led the charge, with only nine women out of the 72 faculty members who committed research misconduct. (1/24)
  • Michelle Meyer (@MichelleNMeyer) additionally shared a letter written by the Editor of The Hastings Center’s Bioethics Forum on the reasoning behind publication of a controversial article on the social pressures leading to obesity. The letter calls for the importance of recognizing that publication means that an article contributes to the larger debate on an issue, though does not affirm that the publication medium agrees with the views espoused within; it also encouraged responses to the ideas of the article. (1/25)
  • Stephen Latham (@StephenLatham) posted a video link from Comedy Central on the perils of WebMD and vegetarianism. (1/25)

Note: As mentioned in previous posts, retweeting should not be considered as an endorsement of or agreement with the content of the original tweet.

Sebelius v. Auburn Regional Medical Center: Hospitals Allege Medicare Intentionally Underpaid Providers–And Got Away With It

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By Katie Booth

In the Supreme Court’s recent decision in Auburn Regional Medical Center, the Court held that a suit against HHS by eighteen hospitals alleging intentional underpayment of Medicare reimbursements was barred by a 180-day internal agency deadline for appeals of reimbursement decisions. The rub is that the hospitals only found out about the underpayments, which allegedly occurred from 1987 to 1994, in March of 2006. These underpayments affected thousands of hospitals and added up to billions of dollars. Yet under Auburn, since the hospitals did not sue within 180 days of the underpayment (or even within an extended three-year window for “good cause”), they cannot recover. The Court in Auburn rejected the hospitals’ argument that equitable tolling should apply, finding instead that “the presumption in favor of equitable tolling does not apply to administrative appeals of the kind here at issue.”

The Auburn decision raises important questions about the ability of the federal government to intentionally underpay healthcare providers. In oral argument, the lawyer for the hospitals characterized HHS’s actions as “intentional concealment . . . [and] misconduct by the Secretary, that caused the statute of limitations time to be missed.” While there are good reasons not to disturb decades-old reimbursement decisions, it is sobering that the federal government can intentionally conceal underpayments and—if it conceals the underpayment for only 180 days—never have to reimburse the injured party. This situation presents a striking contrast “to 42 CFR § 405.1885(b)(3) (2012), which permits reopening of an intermediary’s reimbursement determination ‘at any time if it is established that such determination . . . was procured by fraud or similar fault of any party to the determination.’” In other words, HHS can reopen reimbursement decisions if a provider intentionally conceals important information, but not vice versa.

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Twitter Round-Up (12/9-12/15)

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By Casey Thomson
This week’s round-up looks at the problems of substandard drug prevalence abroad, NIH’s possible push for an anonymous grant-awarding process, and the Liverpool Care Pathway investigation. Check it out below!
  • Dan Vorhaus (@genomicslawyer) included a link to a report on the recent launch of Personal Genome Launch Canada. The post includes links to help navigate the content and learn more about the intricacies of this project. (12/9)
  • Frank Pasquale (@FrankPasquale) shared a post on the benefits and detriments of raising the age of Medicare eligibility from age 65 to 67 – an idea that has recently gained sway in the political arena. The author ultimately concludes that the move would only be a matter of cost shifting rather than cost saving, and thus harm the disenfranchised 65-66 year-olds that would front the cost. (12/10)
  • Frank Pasquale (@FrankPasquale) also included this article on Dr. Oz’s wrongful diagnosis on organics. While concerns about finances must indeed be taken into consideration when families decide what foods to purchase, families must also be concerned about the presence of pesticides in their food. Organic food, while more expensive, avoids this health hazard. (12/10)
  • Frank Pasquale (@FrankPasquale) additionally linked to this report on the preponderance of substandard (and oftentimes, consequentially lethal) drugs particularly in emerging markets. Efforts to crackdown on substandard drugs have thus far focused largely on counterfeit drugs, rather than those that are the result of “shoddy manufacturing and handling…or deliberate corner cutting,” which constitute an arguably much greater public health threat. (12/10)
  • Daniel Goldberg (@prof_goldberg) shared this post on the prevalence of worthless clinical practice guidelines. The article notes the need to distinguish the guidelines that meet much of the Institute of Medicine (IOM) quality criteria from the rest. (12/10)
  • Alex Smith (@AlexSmithMD) linked to a blog post on advance care planning and the gap between the needs of the healthcare system and those of patients. Currently, much of the paperwork required for advance directives is given without providing families and patients concrete skills needed for both identifying their desires and communicating such desires to direct their own medical care. This article calls for refocusing on providing direct patient empowerment in addition to the existing efforts to improve clinician communication in order to facilitate the ability of advance care planning to reflect the patient’s wishes. (12/11)
  • Michelle Meyer (@MichelleNMeyer) retweeted an article about the NIH’s consideration of introducing anonymity into the grant-awarding process in order to alleviate some of the concerns with bias that have long-plagued the agency. (12/12)
  • Dan Vorhaus (@genomicslawyer) also posted a report on BGI, a world-leading DNA sequencing organization based in China, and their commercial expansion efforts into the healthcare, agriculture, and aquaculture sectors. The question of whether BGI is more a research institute or commercial enterprise comes into question in the article. (12/12)
  • Stephen Latham (@StephenLatham) included a link to his own blog post on the recently renewed controversy concerning the Liverpool Care Pathway for the Dying Patient (LCP), particularly as to whether patients put on the LCP had a discussion with their care providers prior to the decision and whether hospitals were wrongly putting patients on the pathway. The talk of scandal sparked an independent investigation into the LCP; Latham’s article expressed his hope for thoroughness in the investigation and for serious consideration on how to renew the LCP effectively. (12/12)
  • Arthur Caplan (@ArthurCaplan) posted a link concerning the implications of 23andMe, a personalized genomics company, and their launch of the $99 genetic test in the hopes of inspiring greater numbers to get tested. The article’s author reflects on how the real benefit will likely not be immediate for individuals, but will rather depend on the chance that greater data will lead to more breakthroughs in understanding the human genome. (12/14)

Note: As mentioned in previous posts, retweeting should not be considered as an endorsement of or agreement with the content of the original tweet.

Dreams Deferred

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After the November election, President Obama’s executive order implementing parts of the so-called “Dream Act” was widely credited with shoring up his support within the Latino community.  Less often noted was his Administration’s decision to exclude the “Dreamers” from the benefits afforded by the Affordable Care Act.

Last August, the Center for Medicare Services (CMS) issued an interim final regulation stating that individuals who benefitted from the President’s program, more formally known as “Deferred Action for Childhood Arrivals” or DACA, would not be considered “lawfully present” for purposes of eligibility to health benefits established by the Affordable Care Act, including the Pre-Existing Condition Insurance Plan and the subsidies and credits that will be available in 2014 to purchase insurance through the health insurance exchanges. Pre-Existing Condition Insurance Plan Program, 77 Fed. Reg. 52614-01 (Aug. 30, 2012) (to be codified 45 C.F.R. § 152.2), http://www.gpo.gov/fdsys/pkg/FR-2012-08-30/html/2012-21519.htm.

The impact of this little noticed determination is quite significant. Although most of the estimated 1.7 million DACA immigrants are healthy, because of their age (under 30), many lack access to employer-provided health insurance. Moreover, if as expected, employers begin to shift their health insurance programs to the ACA-created exchanges, DACA immigrants may find themselves barred from employer-provided plans, even though under the President’s executive order they have a legal right to work in the United States.

The insurance gap created by CMS’ determination that the DACA immigrants are not “lawfully present” in the U.S., a decision that is inconsistent with the Administration’s conclusion that other deferred action recipients are eligible for benefits established under the ACA, illuminates the critical relationship between immigration policy and health policy.  To a surprising degree, the health insurance access problem in the U.S. results from laws that bar immigrants (including many with Green Cards) from many government-supported health insurance programs, including Medicaid. In 2010, over 45 % of non-citizens were uninsured, as compared to less than 14 % of native-born Americans. Approximately 65 % of undocumented immigrants are believed to lack health insurance. The ACA is unlikely to reduce those rates, especially regarding undocumented immigrants. Neither, it is now seems, is DACA.

Twitter Round-Up (12/2-12/8)

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By Casey Thomson
This week’s Twitter Round-Up features an “American Idol-style” selection of research grant winners, the problems facing children in Syria attempting to be vaccinated, and a review of where we stand with current patient health information privacy and security.
  • Michelle Meyer (@MichelleNMeyer) retweeted an article about a newly emerging landmark case in the United Kingdom. In the suit, a childless couple denied IVF funding due to the woman’s age is suing Health Secretary Jeremy Hunt (because he is “ultimately accountable for healthcare in England”) on the basis of age discrimination. Thought to be the first venture to sue the Health Secretary concerning decisions about this NHS fund rationing, this case also will be the first instance where age discrimination laws have been employed to try for fertility treatment. (12/3)
  • Alex Smith (@AlexSmithMD) shared an article about a problem patients must deal with when approaching post-hospitalization care: Medicare’s offer to pay for hospice care or for a Skilled Nursing Facility (S.N.F.), but only rarely at the same time. Not only does the choice create a financial predicament, but it also has extensive repercussions for the patient’s health. Calls for a combined benefit process between hospice/palliative care and S.N.F. have been made, including a proposed “concurrent care” demonstration project in the Affordable Care Act. (12/6)
  • Dan Vorhaus (@genomicslawyer) linked to a summary of the Ponemon Institute’s Third Annual Benchmark Study on Patient Privacy & Data Security, reporting on the challenges still being faced to safeguard protected health information (“PHI”). (12/6)
  • Michelle Meyer (@MichelleNMeyer) additionally retweeted a link explaining Brigham and Women’s Hospital’s attempt to deal with the rising difficulty of choosing which research grants to support: an “American Idol-style” public online voting. With almost 6,500 votes cast, the public engagement experiment picked a project hoping to research methods for integrating genomic sequencing into newborns’ routine medical care. When future grant holders are struggling to award between a set of equally deserving project proposals, this push for public involvement (after having confirmed scientific rigor) may have intriguing implications. (12/6)
  • Daniel Goldberg (@prof_goldberg) also linked to a study in Denmark testing the relationship between socio-economic status (SES) and blood pressure levels. Despite having a healthcare system that is free and equal-access regardless of factors like SES, the study found that SES had a “significant effect on BP [blood pressure] control” in this survey. (12/7)
  • Arthur Caplan (@ArthurCaplan) posted a report by UNICEF on the efforts by parents in the Syrian Arab Republic to get their children vaccinated. With many medical centers destroyed by the conflict, and with health practitioners having to operate and transport supplies in the dangerous environment, children have been unable to receive routine vaccinations for several months. This campaign aims to provide such vaccinations (specifically for measles and polio) to children, having advertised via churches, mosques, schools, television, and even by SMS to get greater coverage. (12/7)
  • Frank Pasquale (@FrankPasquale) included a book review of Pharmageddon by David Healy, a look at how pharmaceutical companies are excessively influencing the medical industry particularly with “diagnostic categories and clinical guidelines.” The result, according to Healy: a society where people “think about their bodies as a bundle of risks to be managed by drugs,” with a workforce that is “getting ‘sicker,’” and with “major pharmaceutical companies…banking on further overdiagnosis and overtreatment,” all “undermining universal health care.” (12/8)

Note: As mentioned in previous posts, retweeting should not be considered as an endorsement of or agreement with the content of the original tweet.

Meaningful Scrutiny for Meaningful Use

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By Nicolas Terry

Today the Office of the Inspector General (OIG) in the Department of Health and Human Services released a report, here, that is decidedly critical of CMS and ONC oversight of the Electronic Health Record (EHR) subsidy program.

Over the last couple of years there have been growing criticisms of the Meaningful Use program and its disbursement of potentially $30 billion in ARRA funds. I have detailed many of these concerns, such as the overall effectiveness of electronic records, my doubts as to the robustness of the first two Stages of Meaningful Use requirements, the safety record of the technologies, their ability to actually save money, their real-world interoperability, and their general usability in the healthcare workflow, here.

Recently, additional questions have been raised that go to the very heart of the subsidy program. First, the Center for Public Integrity, here,  and the New York Times, here, set off a firestorm with allegations of EHR use leading to extensive upcoding. This led to a scolding letter to the healthcare industry from Secretary Sebelius and the Attorney-General, here, and combative words back from some of the addressees, here.

Questions have also been raised about the apparent laxity of CMS in approving payment to providers claiming subsidy funds, leading to CMS announcing a hastily designed audit process, here.

Today’s OIG report elaborates on the same basic issue of lax payment safeguards. First, the report finds that CMS has not implemented strong pre-payment safeguards (either by verifying self-reported data or requiring supporting documentation). Second, it suggests that CMS’s proposed post-payment audit program is limited and potentially flawed. Fortunately, CMS/ONC are in broad agreement with the OIG that the EHR technology itself must step up and meaningfully test for meaningful use. In the meantime increased Congressional scrutiny seems a less elegant but likely surrogate.

The Readmission Penalty Begins to Bite

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By Nicolas Terry

As is well known ACA § 3025 (§1886(q) Social Security Act) established the Hospital Readmissions Reduction program. This is operationalized through deductions built into the Hospital IPPS (Inpatient Prospective Payment Systems) Rule which sets the Medicare reimbursement amounts, here. The excess readmissions ratio initially only applies to readmissions based on MI, Heart Failure, and Pneumonia. Initially the maximum deduction is 1% but that rises to 2% in October 2013 and 3% in October 2015.

A parallel program for Medicaid designed to reduce hospital-acquired infections was introduced in the 2005 Deficit Reduction Act, here. However, Lee and colleagues, here, found no change in infection rates. Nevertheless, the dollars associated with readmissions reduction may give that program greater traction.

Jordan Rau in the New York Times, here, notes that 307 hospitals are already facing the maximum reduction involving many millions of dollars. Not surprisingly some hospitals view the penalties as a distraction while others blame their patients for everything from their level of sickness and poverty to non-compliance. Overall, however, Rau’s article and Amy Boutwell’s recent post at Health Affairs, here, suggest that CMS is succeeding in getting the industry’s attention.