Washington Watch
Congress is making its end-of-year legislative sprint, with hot-button health care legislation stuck behind critical must-pass spending bills before a government shutdown. But lawmakers often push shutdowns off with temporary all-inclusive spending bills as they are likely to do this time, as they try to get out of town for the late December winter holidays.
Even if the spending bills get approved individually or together in one big temporary bill, the must-do list leaves lawmakers roughly 40 days in which both chambers will be in session between now and the end of the calendar year. That's not much time to pass complicated health care bills like drug pricing reform. And drug pricing falls behind higher priorities like the White House's push to get Congressional ratification of a new trade deal with Mexico and Canada, and a contentious debate about gun control measures. Clouding the already-hazy legislative forecast is the ongoing battle between President Trump and House Democrats about investigations into his administration and increasing calls for his impeachment.
The two top health care agenda items – drug pricing legislation and an effort to curb massive unexpected post-hospitalization medical bills patients get ― have strong support among Democrats and Republicans on Capitol Hill and even at the White House. But the details of how to make them work are where the problems are. Consumers are also largely behind efforts to rein in surprise medical bills. The fierce opposition to drug pricing bills comes from – no surprise – the drug companies, hospitals and other powerful health care industries.
Food, pills and medical bills
In order to get a bill through the U.S. Senate, lawmakers are planning to combine complex health care issues into one sweeping legislative vehicle. This allows lawmakers to say they don't like everything in the legislation but must support it. That also prevents one powerful lobbying group from dominating the discussion. But it's a risk because it is so broad that many provisions may cause some lawmakers to just hold their nose and say I can't go for it.
At the same time as the drug pricing and surprise billing issues are on Congress's agenda, actions in the nation's courts on issues critical to seniors are also ongoing. Yet another must-pass item, contained within the government funding bill, has gotten little notice but is vital to seniors – renewal of the Older Americans Act (OAA).
Food insecurity. Congress must reauthorize the OAA, which funds local Agencies on Aging, providing supportive services and programs to assist family caregivers, that enable seniors to remain in their communities. Millions of seniors across the country quietly go hungry as the safety net designed to catch them frays. Nearly 8% of Americans 60 and older were "food insecure" in 2017, according to a recent study released by the anti-hunger group Feeding America. It found that 5.5 million seniors don't have consistent access to enough food for a healthy life, a number that has more than doubled since 2001, and is growing exponentially as America grays.
While Congress has focused on hungry children through the school system, hungry older Americans are often isolated and too proud to ask for help. Most get their meals through Meals on Wheels, a network of 5,000 community-based programs. The problem is most acute in parts of the South and Southwest, Feeding America found, with Louisiana having 12 percent of its seniors facing food insecurity. The city of Memphis fared the worst among major metropolitan areas with 17 percent of seniors unsure of their next meal.
Nutrition services, the biggest part of the OAA's budget, dropped by 8% over the past 18 years when adjusted for inflation, an AARP report found last February. Meanwhile, home-delivered and group meals have decreased by nearly 21 million since 2005. Since malnutrition exacerbates diseases and prevents healing, seniors without steady, nutritious food can wind up in hospitals – which drives up Medicare and Medicaid costs, costing taxpayers as well as seniors. A recent analysis by the Bipartisan Policy Center found that Medicare could save $1.57 for every dollar spent on home-delivered meals for chronically ill older people after a hospitalization.
A recent analysis from Kaiser Health News pointed out that at the same time as seniors are hurting because they don't have enough food on a daily basis, the U.S. Department of Agriculture reports that only 45 percent of those 60 and older who are eligible for SNAP, the government's food stamp program for the poorest Americans, have signed up for the program. That number is so low, most likely, because many people are unaware they qualify. Even fewer may get SNAP in the future: More than 13 percent of SNAP households with elderly members would lose those benefits under a recent Trump administration proposal.
In June, the House passed a $93 million increase to the OAA's nutrition programs, raising total funding by about 10% to $1 billion in the next fiscal year. That's still less than it was in 2009, when adjusted for inflation. But the measure still needs to pass the Republican-controlled Senate, where the proposed increase faces long odds. How that is resolved is expected to be included in the comprehensive government funding bill.
Hospital pricing. There is one area of actual agreement among lawmakers: consumers should be held harmless when they, through no fault of their own, receive bills from physicians or technicians who are out of their insurance network, even when they work at in-network hospitals. What remains a contentious issue is how much the provider giving those services will get reimbursed for their work.
Several lawmakers on both sides of the aisle in both the House and Senate want to add a provision that would give hospitals or insurers the option to appeal the amount to independent arbitration just in case there's an issue with pricing. But it's not clear whether the legislation can gain enough support in the Senate without an arbitration provision.
Drug pricing. Consumer need and interest is clearly driving the push to pass drug pricing legislation. The obvious consensus is that drug prices are too high – but what to do about that is nowhere near finding a workable solution. The Senate Finance Committee led by Republican Chairman Charles Grassley, R-Iowa and Democratic Sen. Ron Wyden, D-Ore, passed legislation that would reduce prescription drug costs for millions of Medicare recipients, while saving money for federal and state health programs serving seniors and low-income people. But it will have to be merged with the Senate HELP committee's bill, which includes the surprise medical bill legislation, in order to get to the Senate floor for a vote.
Their bill would, for the first time, limit drug co-pays for people with Medicare's Part D prescription plan, by capping patients' out-of-pocket costs at $3,100 a year starting in 2022. House Democrats want to go farther by granting Medicare legal authority to directly negotiate prices with pharmaceutical companies – which Congress specifically prevented in 2003 and has repeatedly refused to repeal.
The lack of a cap on out-of-pocket costs for Medicare's popular prescription benefit has left some beneficiaries with bills rivaling a mortgage payment. With Medicare's current protection for catastrophic costs, patients taking very expensive drugs are still responsible for 5% of the cost, with no dollar limit on what they pay. For example, 5% of a drug that costs $200,000 a year works out to $10,000.
The Grassley-Wyden bill does not directly address the problem of high launch prices for new medications, but its inflation rebates could put the brakes on price hikes for mainstay drugs such as insulin, which has jumped from $157.57 for a 20-ounce vial of the long-acting insulin Humulin R U-500 15 years ago, to $1,487 today for the same tiny vial.
That legislation would also require drugmakers to pay a price-hike penalty to Medicare if the cost of their medications goes up faster than inflation. Drugs purchased through a pharmacy as well as those administered in doctors' offices would be covered by the new inflation rebates.
Meanwhile, the Trump administration is appealing a court ruling that struck down its plan to compel pharmaceutical companies to disclose wholesale prices of their drugs in television advertisements. A federal judge in Washington in May said that HHS lacked the authority from Congress to compel drug manufacturers to disclose list prices. An appeal has been filed.
The administration has also floated the idea that states might eventually be allowed to import prescription drugs from Canada, after a lot of maneuvering first and a pledge from the HHS Secretary that safety of the drugs imported would be safe for consumers – something no HHS Secretary has agreed to since the ideas were first floated in the 1990s. Florida recently submitted a plan, the first state to do so, which state officials project could save more than $150 million a year.
The administration is also considering broadening its drug pricing ideas to link the cost of some drugs for the Medicare program to an international pricing index, but no specifics have been officially released.
Observation care. Court battles are underway over Observation Care and the future of the Affordable Care Act. In 2011, seven Medicare patients and their families filed a class action lawsuit against HHS over the maze of regulations surrounding something called observation care.
This happens to patients who go into a hospital where the doctors think they are too sick to go home but not sick enough to be admitted. They stay overnight or linger, usually in regular hospital rooms, getting most of the same services and treatments – often for the same problems as an admitted patient, like intravenous fluids, medications, diagnostic tests, other treatment and round-the-clock care they can only get in a hospital.
Medicare considers observation care an outpatient service, like a doctor's appointment or a lab test. Observation patients may have to pay a larger share of the hospital bill than if they were officially admitted to the hospital. In addition, they must pay for any nursing home care because Medicare's nursing home benefit is available only to those admitted to the hospital for three consecutive days.
Another strange twist is that patients under observation care are not allowed to file an appeal about Medicare's billing decisions. Patients and their families can try to persuade the physician or hospital administrators to change their status, and occasionally that strategy works. If not, they can leave the hospital to avoid the extra expenses, even if doing so is against medical advice. But they also must be aware that they are in observation status and many people never even are told about it until they get their bills.
Observation care claims have increased by about 70 percent since 2008, to more than 2 million in 2017, and claims for observation care patients who stayed in the hospital for longer than 48 hours, who would likely qualify for nursing home covered had they been admitted, rose by nearly 159 percent, a KHN analysis of Medicare data found. Yet the overall growth in traditional Medicare enrollment was just under 9%.
But Justice Department lawyers, in court filings, argue the lawsuit accuses the wrong culprit. They say the government can't be blamed because rules in place give hospitals and doctors – not the government – the final word on whether a patient should be admitted. A recent HHS Office of Inspector General report found the observation care issue was tops on the list of the 25 most important IG's recommendations the agency has failed to implement.
Pre-existing conditions. HHS statistics show that between 50 million to 129 million (between 19 to 50 percent) of non-elderly seniors have some type of pre-existing health condition. And the number of seniors and percentage of seniors is considerably higher than 50 percent, although there are no detailed statistics available.
So far, the Trump administration has made no effort to put any protections for pre-existing conditions into law, if the ACA gets struck down.
Also contributing to this story were: Kaiser Health News, Medpage Today, AP, and Reuters.
