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Category Archives: Health Insurance Industry
Cartoon – Got a Hand?
New York State Investigates Christian Health Cost-Sharing Affiliate
Subpoenas have been issued to a company that solicits memberships for a health insurance alternative that offers no guarantees for covering medical bills.
New York State officials are investigating a business representing a major Christian group offering an alternative to health insurance, joining several states scrutinizing these cost-sharing programs that provide limited coverage.
On Wednesday, New York state insurance regulators issued a subpoena to Aliera, which markets the Christian ministry run by Trinity Healthshare, according to people who have seen the subpoena.
More than one million Americans have joined such groups, attracted by prices that are far lower than the cost of traditional insurance policies that must meet strict requirements established by the Affordable Care Act, like guaranteed coverage for pre-existing conditions.
These Christian nonprofit groups offer low rates because they are not classified as insurance and are under no legal obligation to pay medical claims. But state regulators are questioning some of the ministries’ aggressive marketing tactics, saying some consumers were misled or did not grasp the lack of comprehensive coverage in the case of a catastrophic illness.
Some members have paid hundreds of dollars a month, and then have been left with hundreds of thousands in unpaid medical bills in several states where the ministries, which are not subject to regulation as insurers, failed to follow through on pooling members’ expenses.
Numerous states are taking action against Aliera Healthcare, the for-profit company based in Georgia that was been the subject of an investigation by The Houston Chronicle. The Texas attorney general sued Aliera last summer to stop it from offering “unregulated insurance products to the public,” while Connecticut, Washington and New Hampshire are trying to stop Trinity and Aliera from doing business in those states.
Regulators say they are concerned that the ministry is, in fact, operating as an insurer. In New York, which has not previously investigated any ministries, there have been 15 to 20 complaints, including accusations that Aliera misrepresented the coverage being offered. It’s not clear how many customers Aliera has in New York.
“It’s deeply disappointing to see state regulators working to deny their residents access to more affordable alternatives offered by health care sharing ministries,” said Aliera in an emailed statement.
“We’re proud of the work we do to help ministries provide a more flexible method for securing affordable high-quality health care, and we will continue to vigorously defend against the false claims about our company, just as we expect the health care sharing ministries we serve to vigorously defend their members’ right to exercise their religious convictions in making health care choices,” it said.
Trinity, which was not subject to the subpoena, has said its website makes clear that the ministry does not offer health insurance.
Medicare for All’s missing mental health discussion
America’s mental health care system is in dire need of an overhaul, but the real specifics are largely missing from the 2020 debate about health care.
Why it matters: Suicide and drug overdose rates continue to rise, and the U.S. faces a shortage of mental health providers and a lack of access to treatment.
The big picture: Private insurance is plagued with holes in mental health coverage. Even even though insurers are legally required to cover behavioral health the same way as physical health, they don’t.
Yes, but: “Medicare to All” may not solve the problem, Mental Health America president and CEO Paul Gionfriddo told me.
- “Medicare would need to be redesigned significantly,” he said.
- Medicare has its own coverage flaws. It would also be crucial to design a system that encourages preventive and early identification services rather than just post-crisis care.
There’s also a shortage of mental-health providers. Paying mental health providers more could help address this, but care delivery would also need to be redesigned, Gionfriddo said.
- Rural areas, for example, would likely still struggle to attract and support these providers because of their remoteness and population size.
- “The big wild card is how many mental health providers would participate in a Medicare for all program or opt out of insurance entirely,” said the Kaiser Family Foundation’s Larry Levitt.
For Democrats who support Medicare for All, highlighting how it could help mental health care could have a political upside.
- “Talking about mental health care needs humanizes the candidates, indicts the shortcomings of private insurance and provides rationale for the need for significant reforms around the current system,” Democratic health consultant Chris Jennings said.
Beyond the ACA: Healthcare legal fights to watch in 2020
https://www.healthcaredive.com/news/beyond-the-aca-healthcare-legal-fights-to-watch-in-2020/569793/
All eyes were on the legal drama over the Affordable Care Act as 2019 drew to a close — and while that case remains a focus for this year — a lot more is also at stake.
Payers and providers are fiercely contesting a price transparency push from the Trump administration that would force privately negotiated rates out into the open. The administration is also being challenged over regulations regarding risk corridor payments to payers and the expansion of association health plans.
Antitrust concerns are also front and center, as payers clash over exclusive broker policies in Florida.
As policy debates rage on this year through presidential debates and on Capitol Hill, courthouses will also be a key battleground for the industry in 2020. Below are the big cases to watch.
ACA and the high court
The most consequential case still making its way through the court system is the challenge to the Affordable Care Act. At the end of last year, an appeals court notched a win for the red states fighting the law by declaring the individual mandate was no longer constitutional after the penalty was zeroed out by a Republican-controlled Congress.
The three-judge panel, however, stopped short of declaring the entire ACA void, instead asking the lower court that made the argument that the rest of the law is not severable from the individual mandate to revisit and clarify its ruling.
Supporters of the ACA are trying to speed up what is almost certainly the next major step for the court case by petitioning the Supreme Court on Friday to hear the case before the November presidential election.
“States, health insurers, and millions of Americans rely on those provisions when making important — indeed, life-changing — decisions. The remand proceedings contemplated by the panel majority would only prolong and exacerbate the uncertainty already caused by this litigation,” according to the Jan. 3 petition filed by California Attorney General Xavier Becerra and a coalition of 19 other states and D.C.
Five justices are needed to approve the suggested expedited timeline while four are needed to agree to hear the case at all. More will be clear in the next couple of months as justices make their decisions. The ultimate decision — whether it comes in months or years — will have huge ramifications across the healthcare landscape.
Price transparency pushback
The legal clash between hospitals and the administration over forcing providers to reveal negotiated rates is set to heat up quickly in the new year.
The federal judge overseeing the case recently released a timeline for how it is expected to proceed in the coming months. Hospitals are seeking a swift ruling and summary judgment. HHS faces a Feb. 4 deadline to file its opposition motion to the summary judgment, while deadlines for motions extend through March 10.
“That is an extremely accelerated schedule,” James Burns, a partner at Akerman, told Healthcare Dive. “My strong suspicion is that we’ll get a ruling from the judge late spring or earlier summer at the latest, which is obviously all before the election.”
Hospital groups including the American Hospital Association and health systems have alleged that the administration’s push to force negotiated rates out into the open exceeds the government’s authority and violates the First Amendment because it compels hospitals to reveal confidential and proprietary information. Legal experts say the principal argument will center around whether the government exceeded its authority, not the First Amendment.
Risk corridor payments
On last month’s Supreme Court docket was a case regarding an ACA risk adjustment program. At issue are $12 billion in payments insurers say they are owed from losses on state exchanges.
Early participants in the marketplaces were hit hard in some cases as they attempted to adjust to people gaining coverage under the ACA. A few nonprofit co-ops were driven to close when CMS declared the program had to be budget neutral and therefore only about one-eighth of the expected risk corridor amount could be paid out.
A number of justices seemed to lean toward ruling in favor of the insurers during arguments in front of the high court, Tim Jost, health law expert and professor emeritus at Washington and Lee University School of Law, told Healthcare Dive. “Only a couple of the justices that spoke seemed inclined to support the government, but we’ll see what happens there,” he said.
If the payers do prevail, there’s still the question of exactly how much they are owed and how the money will be distributed. It could ultimately affect medical loss ratio rebates or premiums down the road, he said.
CSR fight in court this week
The legal fight over canceled payments to insurers under the ACA drags on as oral arguments begin this week in a federal appeals court.
A number of insurers including Maine Community Health Options and Sanford Health claim they’re owed millions in cost-sharing reduction payments that the government failed to pay out after the Trump administration said Congress failed to appropriate the funds. The payments were intended to repay insurers for lowering the cost of care to make coverage affordable for those with low incomes.
Health Options and Sanford both won in the lower courts after judges ruled they were entitled to the unpaid CSR payments. The cases have been consolidated within the appeals court and oral arguments start Thursday.
A ruling in favor of insurers in the risk corridor case could be a good sign for their fight to be reimbursed for CSRs as well, Jost said.
Oscar antitrust argument
Health insurer Oscar has alleged that Blue Cross Blue Shield of Florida is enforcing a broker policy that is impeding Oscar’s ability to sell individual exchange plans and undermines competition in Florida.
The key question in this case is whether Florida Blue, a dominant insurer in the sunshine state, can lawfully bar independent brokers from working with other carriers like Oscar by threatening to cut off their ability to sell all other Florida Blue plans if they sell Oscar’s individual plans.
A lower court ruled against Oscar and found that such arrangements are shielded from antitrust scrutiny. A federal law excludes the “business of insurance” from antitrust scrutiny in some cases, legal experts say this case shouldn’t be exempt from antitrust enforcement.
A group of 10 antitrust scholars called the ruling “dangerous” and “plainly incorrect,” in an amicus brief Dec. 23 to the U.S. Court of Appeals for the 11th District.
“The practice at issue here — forming exclusive deals with industry gatekeepers to box out potential entry by competitors — is a quotidian business strategy that appears across many industries and raises well-recognized antitrust concerns,” according to the amicus brief.
Oscar alleges that consumers are harmed if brokers are barred from discussing other plan options outside Florida Blue.
The Department of Justice also intends to file an amicus brief, according to a recent filing in the appeals case.
Association, short-term health plans
The federal court of appeals in D.C. heard arguments late last year to review a judge’s decision in March 2019 declaring association health plans an “end-run” around the ACA. AHPs are offered by business or professional associations and aren’t bound by ACA requirements protecting pre-existing conditions and mandating essential benefits.
U.S. District Judge John Bates had strong language in March for the Trump administration, which is being challenged for loosening restrictions on what groups can offer AHPs — and therefore expanding their presence in the marketplace.
The D.C. appeals court is expected to rule on the case in the coming months. Jost’s take from the oral arguments is that the court seem inclined to reverse Bates’ decision, though he warned the outcome is not certain. “It’s a technical case that really has more to do with interpreting ERISA than the Affordable Care Act, though both are relevant,” he said.
A similar challenge has risen on short-term health plans, which were originally meant as stopgap coverage but have been expanded by the Trump administration to offer up to three years worth of coverage.
U.S. District Judge Richard Leon ruled in favor of the administration in July, saying the plans did not undermine the ACA. The plaintiffs, including the Association for Community Affiliated Plans, the National Alliance on Mental Illness and AIDS United, quickly appealed to the U.S. Court of Appeals in D.C.
Briefs are due this month and argument is likely in the spring, Jost said.
If AHPs and short-term plans are allowed to continue as the Trump administration has pushed for, it presents a concern for the viability of ACA risk pools. Consumer warnings against short-term plans, however, may be working, he said.
“There’s been a lot of publicity about how risky these plans are and I think they probably have not been achieving the same market strength they were hoping for,” he said.
Hospital M&A spurs rising healthcare costs, MedPAC finds
https://www.healthcaredive.com/news/hospital-ma-spurs-rising-healthcare-costs-medpac-finds/566858/
Dive Brief:
- Both vertical and horizontal hospital consolidation is correlated with higher healthcare costs, according to a congressional advisory committee on Medicare, in yet another study finding rampant mergers and acquisitions drive up prices for consumers.
- The Medicare Payment Advisory Commission found providers with greater market share see higher commercial profit margins, leading to higher costs per discharge, though the direct relationship between market share and cost per discharge was not statistically meaningful itself.
- MedPAC also found vertical integration between health systems and physician practices increases prices and spending for consumers. The top-down consolidation leads to higher prices for commercial payers and Medicare alike, as hospitals have more bargaining heft and benefit from Medicare’s payment hikes for hospital outpatient departments.
Dive Insight:
Hospital consolidation has become a major point of concern for policymakers, antitrust regulators and patient advocacy groups. A slew of prior studies have found unchecked provider M&A contributes to higher healthcare costs, with the brunt often borne by consumers in the form of higher premiums and out-of-pocket costs.
Since 2003, the number of “super-concentrated” markets has increased from 47% to 57%, according to the MedPAC analysis of CMS and American Hospital Association data. Those markets, with a high amount of consolidation, rarely see new providers enter, which stifles competition, and are rarely reviewed by the government.
There’s been little change in antitrust regulation since the 1980s and, though the Federal Trade Commission has won several challenges to hospital consolidation in the 2010s, the agency only challenges 2% to 3% of mergers annually.
MedPAC also found super-concentrated insurance markets actually led to lower costs per discharge compared to lower levels of payer concentration, deflating somewhat hospital lobbies’ arguments that payer consolidation is driving prices higher.
Committee members called for more analysis of how macro trends like an aging population and federal policy could be driving consolidation and impacting prices, leading some to call for a revamp of the hospital payment framework itself.
“We have to change the way hospitals are paid. I don’t see another solution,” said Brian DeBusk, CEO of Tennesse-based DeRoyal Industries, a medical manufacturer. “Are you going to undo a thousand hospital mergers? Are you going to enact rate setting? I don’t see another way.”
MedPAC also looked at vertical integration, where hospitals snap up physicians practices downstream. According to the Physician Advocacy Institute, only 26% of physician practices were owned by hospitals in 2012, but by last year that number had spiked to 44%.
Since 2012, billing has shifted from physician offices to hospital outpatient departments, especially in specialty practices. In chemotherapy administration, for example, physician offices saw almost 17% less volume between 2012 and 2018, while outpatient centers saw a 53% increase in volume, according to MedPAC.
Physicians in hospital-owned practices also refer more patients to the hospital’s facilities and, despite a common stumping point that integration improves quality through care coordination, its effect on quality is “ambiguous,” MedPAC analyst Dan Zabinski said Thursday at the committee’s November meeting.
Despite the mountain of evidence, the AHA published a widely-decried study in September claiming acquired hospitals see a reduction in operating expenses and a statistically significant drop in readmission and mortality rates. The study was criticized for not using actual claims data in its analysis among other methodological and conflict of interest concerns.
Republican leaders in the House Energy and Commerce Committee asked MedPAC to study provider consolidation in August, and the body’s full findings will be included in its March report to Congress.
Five health care fights to watch in 2020
Advocates hope lawmakers can beat the odds and move major health care legislation in the new year.
2019 opened with bipartisan talk of cracking down on drug prices and surprise medical bills. But it ended without major legislation signed into law on either front, and a host of other health care battles, including a lawsuit threatening the entire Affordable Care Act, looming over the coming election year.
Here are five health care fights to watch in 2020.
Drug pricing
Lowering drug prices was supposed to be an area for potential bipartisan action in 2019, but the effort ran into a brick wall of industry lobbying and partisan divisions.
There is a push to finally get legislation over the finish line in 2020, though.
Speaker Nancy Pelosi (D-Calif.) is calling for attaching drug pricing legislation to a package of expiring health care programs, like community health center funding, that must be renewed by May 22. She hopes the pressure from that deadline helps carry a larger package, but that is far from certain, especially as the election gets closer.
Democrats point to President Trump’s vow to support allowing the government to negotiate drug prices during his 2016 campaign. While Trump backed off that pledge this year, they hold out hope he might come back around. Senate Majority Leader Mitch McConnell (R-Ky.) is also strongly opposed to the idea, and has concerns about a more modest bill from Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.) that could provide a more realistic bipartisan path.
“The president said when he ran and until relatively recently that he would support negotiated prices and I expect at some point he will go back to that, and we’re just going to keep pushing the Senate to try to achieve that,” said House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.).
Surprise billing
The other major health care initiative that Pelosi says she wants in the May package is protecting patients from surprise medical bills.
That effort has also fallen prey to intense industry lobbying and congressional infighting.
Backers of a bipartisan bill from the House Energy and Commerce Committee and Senate Health Committee on the issue pushed for including the measure in a year-end spending and were deeply frustrated when it was left out.
A key factor was House Ways and Means Committee Chairman Richard Neal (D-Mass.) putting forward the outline of a rival plan days before this month’s funding deadline, showing a split on the way forward.
“It’s certainly going to be harder [next year],” said Shawn Gremminger, senior director of federal relations at Families USA, a liberal health care advocacy group.
“You are now under six months out from the general election,” he said about moving legislation in May 2020.
Backers have a tough road ahead. They will have to bridge the divide between the competing plans and overcome lobbying from powerful doctor and hospital groups, who worry the legislation could lead to damaging cuts to their payments.
ObamaCare
Outside of Capitol Hill negotiating rooms, the GOP lawsuit to overturn the Affordable Care Act is looming large.
A federal appeals court last week issued a long-awaited ruling on the fate of the law, though it did little to settle the issue. The 5th U.S. Circuit Court of Appeals ruled that the law’s mandate to have health insurance is unconstitutional, but punted on the question of whether any of the rest of the law should also be struck down, instead sending it back to the lower court.
The most tangible effect of the move could be to push a final Supreme Court decision on the fate of the law past the 2020 elections, though it’s possible the justices could still choose to take the case sooner.
Democrats intend to hammer Republicans over the lawsuit during next year’s campaign, though, a strategy that paid off for the party during the 2018 midterms when they focused on health care.
The Democratic group Protect Our Care launched a national TV ad on Friday, saying “President Trump and Republicans just won a major decision in their lawsuit to repeal health care from millions of American families,” and warning of the loss of pre-existing condition protections.
Medicare for All
In the Democratic presidential race, “Medicare for All” is a central dividing line.
How the issue plays out in 2020 will depend in large part on who wins the Democratic nomination. If progressives like Sens. Bernie Sanders (I-Vt.) or Elizabeth Warren (D-Mass.) win the nomination, Republicans will be able to go full bore on their attacks that private health insurance would be eliminated under the proposal.
Even more moderate candidates like former Vice President Joe Biden and South Bend, Ind., Mayor Pete Buttigieg PETER (PETE) PAUL BUTTIGIEGPoll: Biden remains ahead of Sanders by 10 points2020 predictions: Trump will lose — if not in the Senate, then with the votersButtigieg’s former chief of staff to be sworn in as mayoral successorMORE would face attacks that their public option plans are a step down the road toward eventually implementing full-scale single payer.
The internal debate on the issue has faded somewhat from its peak. Health care has not featured as prominently in the last two debates, and some of the fighting has shifted to other areas, like candidates’ fundraising practices.
But the issue is still simmering and could burst back to open warfare among Democrats at any point.
Vaping
The battle over e-cigarette flavors will likely resume in 2020 as the Trump administration and Congress try to cut rising youth vaping rates.
Public health advocates are pushing the administration to clear the market of flavors like mint and fruit that they argue are fueling a youth vaping epidemic.
Trump said he would eliminate those flavors in September, but has appeared to back down after backlash from vaping advocates and the e-cigarette industry.
Now he says he would like to find a compromise that preserves such flavors for adults while keeping them away from kids.
Advocates like the Campaign for Tobacco-Free Kids plan to pressure Trump to follow through on his word, though it’s looking unlikely.
However, the e-cigarette market could also look vastly different after May 2020, when companies must apply to the Food and Drug Administration to stay on the market
The industry must prove its products benefit public health, a big ask for companies like Juul, whose products are favored by kids who vape.
House Democrats also plan to vote on a bill that would ban flavored e-cigarette and tobacco products, but it’s not clear if it will get a vote in the Senate.
TOP 6 HEALTHCARE MERGERS OF 2019
M&A activity continued to thrive among insurers and providers in 2019.
As was the case in 2018, the healthcare industry saw several megamergers occur in 2019.
Healthcare leaders pointed to industry consolidation as the year’s top priority, according to a Definitive Healthcare survey, with different reasons for pursuing mergers.
Related: Top 5 Healthcare Mergers of 2018
Providers sought to achieve scale in order to address staffing shortages while insurers looked to respond to the increasing influence of consumerism in healthcare.
While some mergers fell through, many organizations announced or finalized deals during the course of the year.
Below are six major healthcare mergers that were announced or completed in 2019.
1. CVS-AETNA
The nearly $70 billion megamerger received final judicial approval in September after an extended review by U.S. District Judge Richard J. Leon.
The merger originally received approval from the Department of Justice in October 2018 but was subject to questions and criticisms by numerous stakeholders.
The deal was marked by scrutiny over vertical mergers, with Leon noting that his approval shouldn’t be seen as a rubber stamp.
2. CENTENE-WELLCARE
Centene Corp. announced a $17.3 billion merger with WellCare Health Plans in March, a move seen as doubling down on the marketplaces established by the Affordable Care Act.
The merged company will be based in St. Louis and encompass 22 million members, $97 billion in revenues, and $5 billion in EBITDA for 2019.
The pending transaction has already received regulatory approval from 25 states.
Earlier this month, Centene agreed to sell its subsidiary IlliniCare Health to CVS Health, including its Medicaid and Medicare Advantage plans in Illinois.
3. DIGNITY-CHI
Dignity Health and Catholic Health Initiatives finalized a $29 billion megamerger between the two Catholic health systems in February.
Renamed as “CommonSpirit,” the Chicago–based health system has a footprint in 21 states, with more than 700 care sites and 142 hospitals.
In November, the system released its Q1 2020 financials highlighted by $7.1 billion in revenues and a net loss of $227 million.
4. HARVARD PILGRIM-TUFTS
Harvard Pilgrim Health Care and Tufts Health Plan announced an intention to merge in August, potentially serving nearly 2.4 million plan members across New England.
As part of the proposed deal, Tufts CEO Tom Croswell would serve as CEO of the merged company while Harvard Pilgrim CEO Michael Carson would serve as president.
The two Massachusetts-based insurers told The Boston Globe earlier this month that the merger would benefit consumers with more affordable health coverage.
5. TOTAL HEALTH CARE-PRIORITY HEALTH
Total Health Care and Priority Health received final regulatory approval from the Michigan Department of Insurance and Financial Services (DIFS) in late November.
The two Michigan-based healthcare organizations, which announced plans to merge in late August, plan to complete the deal by the end of 2019.
Prior to receiving approval from state regulators, Total Health Care members approved the merger earlier this fall.
As part of the merger, the two Michigan-based healthcare organizations will also be establishing a $25 million foundation to improve health outcomes in Detroit.
6. DARTMOUTH-HITCHCOCK-GRANITEONE HEALTH
Two New Hampshire-based health systems agreed to merge nine months after signing a letter of intent to merge.
The new merged system will be renamed “Dartmouth-Hitchcock Health GraniteOne” and includes Catholic Medical Center in Manchester.
Both organizations will maintain their locations and local leadership as part of the deal.
5 trends and issues to watch in the insurance industry in 2020
https://www.fiercehealthcare.com/payer/top-5-trends-and-issues-to-watch-insurance-industry-2020
The insurance industry appears likely to have another big year in 2020, as growth in government and commercial markets is expected to continue.
But a presidential election and new transparency initiatives could throw some major curveballs to payers.
Here are the top five issues and trends to watch out for in the next year:
Medicare Advantage diversifies
Enrollment growth in Medicare Advantage is likely to continue next year, as more than 22 million Medicare beneficiaries already have a plan. But what will be different is diversification into new populations, especially as insurers pursue dually eligible beneficiaries on both Medicare and Medicaid.
“This is being made possible because of strong support from government,” said Dan Mendelson, founder of consulting firm Avalere Health.
Support for Medicare Advantage “transcends partisanship and that has been true under Trump and Obama,” he added.
New benefit designs, such as paying for food or transportation to address social determinants of health, are also going to increase in popularity. The Centers for Medicare & Medicaid Services (CMS) has made it easier for plans to offer such supplemental benefits.
Get ready for transparency, whether you like it or not
This past year saw CMS release a major rule on transparency that forces hospitals to post payer-negotiated rates starting in 2021 for more than 300 “shoppable” hospital services.
The rule, which is being contested in court, could fundamentally change how insurers negotiate with hospitals on how to cover those services. The rule brings up questions about revealing “private information for the sake of transparency,” said Monica Hon, vice president for consulting firm Advis.
But it remains unclear how the court battle over the rule, which has garnered opposition from not just hospitals but also insurers, will play out. Hospital groups behind the lawsuit challenging the rule have had success getting favorable rulings that struck down payment cuts.
“I think there is going to be a lot of back and forth,” Hon said. “Whatever the result is that will impact how payers and providers negotiate rates with this transparency rule.”
Don’t expect major rules in 2020
2020 is a presidential and congressional election year, and traditionally few major initiatives get going in Congress. But experts say the same goes for regulations as administrations tend not to issue major regulations in the run-up to the vote in November, said Ben Isgur, leader of PwC’s Health Research Institute.
“What we will end up with is much more change on regulations on the state side,” Isgur said.
But new regulations on proposals that have been floated could be released. Chief among them could be a final rule to halt information blocking at hospitals and a new regulation on tying Medicare Part B prices for certain drugs to the prices paid in certain countries.
Congressional lawmakers are still hoping to reach a compromise on surprise billing, but they don’t have much time before campaigning for reelection in November.
A lot of the healthcare direction will be set after the presidential election in November. If a Democrat defeats President Donald Trump, then waivers for items like Medicaid work requirements and block grants will likely go by the wayside.
“Depending on who takes the White House and Congress, are we going to further repeal the Affordable Care Act and replace it or will we have Medicare for All,” Isgur said.
Insurers continue to go vertical in dealmaking
Insurers certainly weren’t shy about engaging in mergers and acquisitions in 2019, and that trend doesn’t appear likely to dissipate next year.
But the types of mergers might be different. Insurers and providers are increasingly looking at deals that would offer a vertical integration, such as acquiring more pharmacy services or a technology company to enhance the patient experience. Plenty of big-ticket vertical deals, such as CVS’ acquisition of Aetna and Cigna’s purchase of Express Scripts, have changed the industry landscape significantly.
“Deals in 2020 are going to be much more around the identity,” Isgur said. “Five years ago we had a lot of horizontal deals where health systems got bigger and regional payers got bigger.”
Payers continue to push patients away from hospitals
Insurers are going to try to find new ways to push patients toward outpatient services to avoid higher costs from going to a hospital.
For instance, “we are seeing a lot of payers not going to honor hospital imaging,” said Hon. “A lot of payers are saying we want you to go outside the hospital and that is a lot cheaper for us,” she said.
Instead, payers will try to steer patients toward imaging centers or physicians’ offices.
“We are seeing that with imaging and free-standing surgical centers now being able to do a lot more,” she added.
Insurers are also starting to use primary care more proactively to “ensure that they understand the needs of the patient, their needs are being addressed,” Mendelson said.
Government funding bill deal will repeal key ACA taxes
Congress is expected to soon announce a deal to repeal the Affordable Care Act’s health insurance, medical device and “Cadillac” employer health plan taxes — and to raise the smoking age to 21, according to a senior House Democratic aide familiar with talks.
Why it matters: The decision is a colossal win for the health care industry.
Private insurance’s costs are skyrocketing
The cost of private health insurance is out of control, compared to Medicare and Medicaid. You see that clearly if you take a long-term view of recently released federal data on health spending.
Why it matters: This is why the health care industry — not just insurers, but also hospitals and drug companies — is so opposed to proposals that would expand the government’s purchasing power. And it’s why some progressives are so determined to curb, or even eliminate, private coverage.
HENRY KOTULA 