HealthCare Roundtable e-News – December 15, 2020

Posted on by HealthCare Roundtable

Surprise Billing Deal Announced, Relies On Arbitration

House Ways & Means Committee Chair Richard Neal (D-MA) on Friday convinced his colleagues to back a provider-friendly fix to ending surprise medical billing. All four health care committees of jurisdiction agreed to the fix, which relies on arbitration, without benchmark pay rates, and creates an arbitration system for out-of-network surprise medical bills centered around the median in-network payment for services. Lawmakers hope to pass it by the end of the year. (InsideHealthPolicy)

However, Senate Majority Leader Mitch McConnell (R-KY) recently said he’s uninterested in putting the policy in the year-end spending bill, according to multiple sources, and it’s not clear whether the new deal will change McConnell’s disposition. The proposed surprise billing fix would hold patients harmless from surprise medical bills by ensuring they are only responsible for the in-network payment rates. The bill would require two arbiters to settle disputes between providers and insurers. The arbiters would consider median in-network rates, information related to the providers’ experience and the complexity of services.

The independent dispute resolution would be binding, payments would be made within 30 days and there is no monetary threshold for triggering arbitration. Parties would be allowed to initiate dispute resolutions once each 90 days. A ban on air ambulance surprised bills is included in the deal, and arbitration for those services would be the same as for other medical services. The bill also would prohibit out-of-network providers from billing patients unless patients are notified 72 hours before receiving out-of-network services.

Several months ago, House Energy & Commerce Chair Frank Pallone (D-NJ), Education & Labor Chair Bobby Scott (D-VA) and retiring Senate health Committee Chair Lamar Alexander (R-TN) agreed on an insurer-backed deal that uses benchmark pay rates and an arbitration backstop. But Neal and members of the Ways & Means Committee insisted on excluding benchmark pay rates.

Neal and House Speaker Nancy Pelosi (D-CA) met last weekend to hash out differences, and though Pelosi gave Neal many concessions, Neal walked away from negotiations, according to multiple people with knowledge of the meeting. It’s still unclear what made Neal change his mind since that meeting.

Insurers and employer groups, including the Roundtable, have advocated against using arbitration to end surprise medical bills, and this will continue until the final hour. Arbitration adds administrative costs, which can impact consumers premiums and reduce savings. Insurers and consumer advocates also worry that, because arbitration is a relatively opaque process, providers and private equity groups may use the process to their advantage. (InsideHealthPolicy)

The Roundtable will continue to monitor this important legislation and will be touch with further updates.

Supreme Court Rules in Favor of Arkansas Law Regulating PBM Reimbursements

Last week, the Supreme Court unanimously ruled in favor of a 2015 law passed in Arkansas that prohibits pharmacy benefit managers from reimbursing pharmacies at a lower rate than the cost it takes to dispense the drug. The results of the case, Rutledge v. Pharmacy Care Management, reverse the lower courts’ ruling are key to validating other states’ efforts to address concerns that reimbursement rates set by PBMs are often lower than pharmacies’ costs. (InsideHealthPolicy)

During oral arguments for the case in October, several justices expressed skepticism of the law, including Chief Justice John Roberts, who claimed that while the law may have an impact on drug prices, he believes the core of the case is more focused on ERISA preemption. Ultimately, the ruling in this case was against ERISA preemption of the Arkansas law, which Justice Sonia Sotomayor wrote in the opinion that the decision was based only on ERISA preemption, not drug cost concerns. She wrote that not all state laws that affect ERISA plans or plan administration have an “impermissible connection” with ERISA.

The ruling was applauded by pharmacy groups. Douglas Hoey, CEO of National Community Pharmacists Association, said the victory “confirms the rights of states to enact reasonable regulations in the name of fair competition and public health.”

Study Finds Drug Manufacturers Continue to Hike Prices Throughout Pandemic

An increase in demand for drugs that are being tested as COVID-19 treatments has led to an exponential increase in drug costs in 2020, according to a report from Patients for Affordable Drugs. The findings cited that the industry increased prices on more than 1,000 drugs this year as millions of Americans’ health and insurance are impacted by the pandemic.

The report identified several key drugs that have seen significant price hikes, including Adzenys, an amphetamine manufactured by Neos Therapeutics that saw a price hike of 10% in July this year—nearly 60 years after amphetamine’s first approval. Other drugs that saw notable price increases were Jakafi, produced by Incyte Corporation, Zoladex, produced by TerSera Therapeutics and AstraZeneca, and Nerlynx, a breast cancer treatment produced by Puma Biotechnology.

In June, the advocacy group released the findings from an analysis of the industry citing that more than 75% of the 245 price hikes seen throughout the pandemic directly pertained to COVID-19, with the key categories for drug price hikes including COVID-19 clinical trial drugs, cancer drugs, cardiovascular drugs and common ICU drugs.

Employer Health Care Groups Ask Congress to Fund COBRA Costs, Change Employee Retention Tax Credit Program

The Alliance to Fight for Health Care and several other employer health care groups are proposing that Congress consider 10 policies that would provide quick relief for consumers needing coverage throughout the pandemic, including axing the mandate that consumers refund subsidy overpayments and funding 95% of COBRA costs. Among the groups’ proposals are also requests to change the Employee Retention Tax Credit program to make health benefits 100% reimbursable and extend the Affordable Care Act’s tax credits to cover every American, not just those earning 400% or less of poverty. (InsideHealthPolicy)

“As you work to pass government funding and additional COVID-19 relief during the lame duck session of Congress, we urge you to include policies that will give American families peace of mind that they can retain affordable access to their current providers and health care coverage if they get sick,” the coalition wrote in a letter to Congressional leaders.

The Alliance to Fight for Health Care has pushed for COBRA funding on other occasions, a proposal that has some bipartisan support but has been opposed by both Democrats and Republicans. Chris Jennings, a Biden adviser and fellow at the Bipartisan Policy Center, shared insight at a recent event that he sees many Republicans in Congress being more open to funding COBRA than to increasing the ACA tax credits, commenting that the president-elect is also in support of COBRA subsidies. (InsideHealthPolicy)

Health Care Enrollment Reports from CMS Beat 2019 Numbers as Healthcare.gov Deadline Approaches

The latest snapshot of healthcare.gov enrollments shows more than 915,000 individuals have registered for selected plans on the platform during the fifth week of the 2020 enrollment period, according to CMS. The new data accounts for 256,299 new consumers and 658,819 returning customers, making the total number enrollees of more than 3.8 million—up from 2.8 million in 2019.

GetCovered2021, a campaign launched by a coalition of health leaders, elected officials and celebrities, has been pushing for Americans to get the health coverage they need through the campaign’s hashtag and designated “Get America Covered Day”, which was on December 10th, as the enrollment deadline approaches.

Maryland Gov. Larry Hogan (R), a member of a bipartisan group of other states pushing the campaign, said the pandemic “is impacting Americans from all walks of life and serves as a critical reminder of the need to stay healthy and to make sure you’re receiving the best health care possible.” Kentucky Gov. Andy Beshear (D) also called on constituents to get coverage, claiming “there has never been a more important time than now to ensure quality health coverage for all.”

The deadline to enroll for Americans in states using healthcare.gov is December 15th, with some other states opting to keep their exchanges open through January. For more information, visit healthcare.gov and getcovered2021.org