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ACA Slow Enrollment as Uninsured Rate Remains Steady

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https://www.healthaffairs.org/do/10.1377/hblog20181120.831184/full/

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In most states across the country, the open enrollment period for 2019 began on November 1 and will end on December 15, 2018. As we near the halfway point for enrollment—at least for the states with a federal marketplace—recent federal data suggests that enrollment in Affordable Care Act (ACA) marketplace plans is lagging relative to last year.

In its “week 2” enrollment snapshot, the Centers for Medicare and Medicaid Services (CMS) announced that nearly 1.2 million consumers selected a plan between November 1 and November 10 in the 39 states that use HealthCare.gov. Of these consumers, about 275,000 were new consumers while about 901,000 were renewing their coverage from last year. This reflects a significant increase from the first three days of open enrollment when about 371,000 consumers selected a plan.

“Week 2” plan selections are down by about 302,000 consumers relative to last year. This can be read as between an 8 to 13 percent decline in plan selections compared to last year, when a total of 11.8 million consumers in all 50 states and DC selected or were automatically reenrolled in a marketplace plan. Enrollment remained largely stable from 2017 to 2018 despite a shortened open enrollment period and significant cuts to advertising and navigator funding.

This year, however, brings additional changes that could be contributing to what is, at least so far, depressed enrollment through HealthCare.gov. These changes include repeal of the individual mandate penalty; 2019 is the first year that consumers will no longer pay a penalty for being uninsured under the ACA. In addition, new federal rules are enabling expanded access to non-ACA plans (such as short-term, limited-duration insurance and association health plans). These non-ACA plans typically have a much lower premium than ACA plans and could lure consumers away from the marketplace.

It is too early to tell if the reduced enrollment trend will hold and if this pattern will continue. Enrollment may increase significantly before the December 15 deadline, and millions of Americans will enroll in coverage before the end of the year.

The declines are, however, significant. The former chief marketing officer for HealthCare.gov recently noted that the data “should be a wake-up call to everyone who cares about people having health care … on the need to step up efforts to raise awareness.” CMS intends to release enrollment snapshots on a weekly basis. Each snapshot also includes point-in-time estimates of call center activity and visits to HealthCare.gov and CuidadoDeSalud.gov, among other data.

The new open enrollment data comes at a time when the uninsured rate continues to remain steady. Data from the National Center for Health Statistics—in reports both from late August and November—shows that the uninsured rate of about 8.8 percent for 2018 remains largely unchanged from 2017. Although there was not a significant shift from 2017 to 2018, there has been a sizable drop in the uninsured rate since the ACA was enacted in 2010. Between 2010 and the first six months of 2018, the uninsured rate dropped from 16 percent (48.6 million people) to 8.8 percent (28.5 million people).

 

 

Five controversial health actions on Trump’s agenda

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Five controversial health actions on Trump’s agenda

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The Trump administration is expected to push ahead with a range of controversial health policies next year despite Democrats retaking the House.

Democrats captured the House majority in part on their health-care message. But despite that there are a slew of actions where the administration is moving ahead on its own agenda.

Here are five controversial moves Trump officials are expected to make on health care.

 

Roll back transgender protections

A new policy from the Trump administration could limit or completely eliminate federal protections for transgender individuals.

The move would narrow the definition of gender under a federal civil rights law to either male or female, as defined by a person’s sex at birth.  It’s being spearheaded by the Department of Health and Human Services and reportedly being pushed across multiple agencies.

The potential change has alarmed activists and medical professionals. The American Medical Association, the country’s largest physician lobbying group, said it will “oppose efforts to deny an individual’s right to determine their stated sex marker or gender identity.”

The new policy could be related to a broader proposed rule that’s been under review by the White House Office of Management and Budget since April, that opponents say would make it easier for doctors and hospitals to deny treatment to transgender patients and women who have had abortions.

That rule is expected to roll back a controversial anti-discrimination provision buried within ObamaCare, which prohibits health care providers and insurers who receive federal money from denying treatment or coverage to anyone based on sex, gender identity, or termination of pregnancy, among other conditions.

Religious providers say they expect the Trump administration’s rule would merely reinforce their right not to provide treatment that’s against their beliefs.

 

Limit abortion providers from getting federal money

The administration is expected to finalize regulations in January that would make it harder for Planned Parenthood and other abortion providers to receive federal family planning money.

The rule would ban clinics that receive Title X family planning funds from referring women for abortions while also removing a requirement that clinics counsel women on abortion as an option.

It would also require Title X grantees have a physical and financial separation from abortion providers.

Anti-abortion groups, like the Susan B. Anthony List, have pushed the Trump administration to implement these rules as a way to cut Planned Parenthood and other abortion providers from the program.

Title X funds organizations offering family planning services, like birth control and pregnancy tests, to low-income women and men.

Similar regulations were issued under former President Ronald Reagan, and later upheld by the Supreme Court, but never went into effect due to a lengthy legal battle.

The regulations are expected to be in effect for the next batch of Title X grants, which begin in April.

 

Approve more state Medicaid work requirements

The Department of Health and Human Services is committed to allowing states to impose work requirements on Medicaid beneficiaries.

The administration has approved work requirements in five states so far, and several more are expected in the coming months.

Just this week, the administration reapproved a plan in Kentucky to charge premiums, impose work requirements and remove people from the Medicaid program if they don’t comply.

The initial effort was blocked by a federal judge, but by re-approving it with only technical changes, the administration showed its commitment to forge ahead despite criticism.

Opponents say the requirements are a way to punish poor people. They argue the requirements are only meant to kick people off Medicaid and save states money.

Arkansas was the first state to implement a work requirement, and more than 12,000 people have lost health coverage as a result.

The administration insists work requirements are empowering, and help people lift themselves out of poverty and government dependence.

Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma sounded a defiant tone when she announced the administration’s approval of Wisconsin’s work requirements at the end of October.

“We will not retreat from this position,” Verma said. “Community engagement requirements in Medicaid are not a blunt instrument. This is a thoughtful and reasonable policy, and one that is rooted in compassion.”

 

Indefinitely detain migrant families

The Trump administration is seeking to indefinitely jail migrant children with their families, a policy that would overturn 20 years of protections for immigrant children.

The administration is expected to issue final regulations that would terminate and replace the Flores agreement, which has governed the detention of migrant children since 1997.

The plan, which was issued in September, would allow immigration officials to keep children and their parents detained together for the entire length of their court proceedings, which could take months in some cases.

Comments on the proposal were due earlier this month, and the rule could be made final next year.

The Flores rules are the result of a settlement in a federal class-action lawsuit over the physical and emotional harm done to children held in jail-like settings for extended periods. The settlement was only meant to be temporary, until it could be written into federal law.

Multiple administrations have challenged the rules and attempted to extend the time migrant children can be detained, but the federal judge overseeing the case has rejected those attempts.

The Trump administration is trying something novel; no administration has attempted to replace the Flores agreement with new regulations. It’s not a guarantee of success, and advocates have promised a challenge as soon as the final rules are announced.

 

Loosen nursing home emergency preparedness rules

Senate Democrats are decrying a move by the Trump administration to change safety rules for nursing homes.

The administration says the proposal would reduce a regulatory burden and save money for providers. But critics say that instead of making nursing homes safer, the proposal would put seniors at risk.

Sen. Ron Wyden (D-Ore.), ranking member of the Senate Finance Committee, said the administration is moving in the opposite direction of what they should be doing in the wake of hurricanes last year that left dozens of people dead across multiple states.

Last year, 12 people died when a Florida nursing home lost power in the wake of Hurricane Irma. In Texas, multiple facilities decided not to evacuate after Hurricane Harvey, despite warnings about the threat of catastrophic flooding.

The original emergency preparedness requirements went into effect just last year, more than a decade after the Department of Health and Human Services (HHS) Office of Inspector General first called for reform in the wake of hurricanes Katrina and Rita.

A report from Senate Finance Committee Democrats included 18 recommendations to improve nursing home safety during natural disasters. But Wyden said the administration is ignoring them in order to “pad the pockets of medical providers.” 

 

Can a Divided Congress Fix Health Care?

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KFF Health Tracking Poll – November 2018: Priorities for New Congress and the Future of the ACA and Medicaid Expansion

The Kaiser Family Foundation’s latest tracking poll finds that costs and affordability are the health care issues Americans most want Congress to address — though the public remains highly skeptical that Democrats and Republicans can actually work together to do anything on health care.

The poll also finds that the favorability of the Affordable Care Act has risen to 53 percent and that 59 percent of people living in states that have not expanded Medicaid under the ACA want such an expansion.

Key Findings:

  • The November KFF Health Tracking Poll, conducted the week after the 2018 midterm election, finds a majority of the public wants the new Democratic majority in the U.S. House of Representatives to work with Republicans on legislation to address the major problems facing the country as well as conduct oversight of the Trump administration’s actions on policies such as health care. Yet, few Americans are “very confident” (6 percent) that Republicans and Democrats in Congress will be able to work on bipartisan legislation to address the health care issues facing the country.
  • The midterm elections brought Medicaid expansion to three additional states, bringing the total number of states that have expanded their Medicaid programs to cover more low-income uninsured adults to 37 (including Washington, D.C.). Those living in states that have not expanded their Medicaid programs continue to hold a favorable view of Medicaid expansion and most would like to see their state expand their Medicaid program. And as a possible indicator of how some other states may expand their Medicaid programs in the future, most of those living in a non-expansion state say that if their state government chooses not to expand, voters themselves should be able to decide if their state expands their Medicaid program.
  • The new Democratic majority in the House all but guarantees the Affordable Care Act (ACA) will remain the law of the land for at least the next two years. The most recent tracking poll finds a slight uptick – largely driven by Democrats – in the overall favorability of the law (53 percent) and many of the ACA’s provisions continue to be quite popular with a majority of the public. But the poll also finds the public is largely unaware about the law’s sixth open enrollment period, and four in ten 18-64 year olds who buy their own insurance or are currently uninsured say they will choose to go without coverage in 2019.

    Most Americans say it is “very important” to keep the ACA provisions barring insurers from denying coverage or charging more (62%) to people with pre-existing conditions, even after hearing that these may have increased costs for some healthy people

  • A divided Congress does not mean that the coming year will not see any changes to the country’s health care system. There is an impending lawsuit, Texas v. United States, which may end the ACA’s protections for people with pre-existing medical conditions as well as the Trump administration’s recent actions allowing employers to be exempt from covering the full cost of birth control for their employees if they oppose to it due to religious or moral reasons, which could lead to substantial changes to health coverage for many Americans. This month’s tracking poll examines the public’s support for these proposed changes and examines the malleability of these opinions.

The Public’s Priorities for Next Congress

With Democratic gains in the U.S. House of Representatives during the 2018 midterm election, Democrats and Republicans will split control of Congress next year. These results will mean that President Trump will have a divided Congress for the first time in his presidency. About half of the public (53 percent) say oversight of the Trump administration’s actions on policies such as health care, education, and the environment should be a “top priority” for House Democrats in the coming year. This is similar to the share (55 percent) who say that working to enact new laws to address the major problems facing the country should be a “top priority” for House Democrats in the coming year and substantially larger than the share who say investigating corruption within President Trump’s administration should be a “top priority” (36 percent).

Majority of The Public Say Working To Enact New Legislation And Oversight Are Top Priorities For Democrats

Figure 1: Majority of The Public Say Working To Enact New Legislation And Oversight Are Top Priorities For Democrats

Unsurprisingly, the share of partisans who say each of these should be a “top priority” for Democrats in the U.S. House of Representatives varies drastically; majorities of Democrats saying conducting oversight (77 percent), working to enact legislation (67 percent), and investigating corruption (58 percent) should all be top priorities for the coming year. A majority of independents (54 percent) say working to enact legislation should be a “top priority,” while less than half of Republicans say any of these – including working to enact legislation – should be “a top priority” for House Democrats.

Figure 2: Most Democrats Say New Legislation, Oversight, and Investigating Corruption Are Top Priorities For House Democrats

Figure 2: Most Democrats Say New Legislation, Oversight, and Investigating Corruption Are Top Priorities For House Democrats

Immigration and Health Care Top Public’s Priorities

Similar to the issues driving voters in the 2018 midterm elections, the most recent KFF Health Tracking Poll finds immigration and health care as the top issues the public want to see the next Congress act on in 2019 with the issues offered largely driven by party identification. Overall, about one-fifth of voters offer immigration or border security (21 percent) when asked to say in their own words the issue Congress should work on next year. This is similar to the share of the public who offer health care (20 percent) as the top issue they want to see the next Congress work on. Fewer offer gun control/legislation (8 percent), tax reform (4 percent), or education (4 percent) as the issues they want to see Congress act on in 2019.

Four times as many Republicans (41 percent) offer immigration/border security as the issue they would most like the next Congress to act on in 2019 as Democrats (10 percent). On the other hand, health care is the top issue for Democrats. One-fourth of Democrats (27 percent) say health care is the issue they would most like to see the next Congress act on, compared to 11 percent of Republicans who say the same. Independents are divided across the top two issues, with similar shares offering immigration/border security (22 percent) and health care (21 percent) as the issues they want to see Congress work on.

Table 1: Immigration and Health Care Top Public’s Priorities for Next Congress
Thinking about next year, which issue would you most like the next Congress to act on in 2019? (open-end) Total Democrats Independents Republicans
Immigration/Border security 21% 10% 22% 41%
Health care 20 27 21 11
Gun control/legislation 8 13 4 8
Tax reform 4 2 7 8
Education 4 7 2 –
Note: Only top five responses shown. Question asked of half sample.
COST AND AFFORDABILITY CONTINUES TO DOMINATE HEALTH CARE PRIORITIES

When asked which health care issue they would most like to see the next Congress act on in 2019, more Americans offer issues around health care affordability and cost (19 percent) than other health care issues including the 2010 Affordable Care Act (ACA) (10 percent) or Medicare (6 percent). Health care affordability and cost are also the most frequently mentioned health care issues by Democrats (14 percent), independents (25 percent), and Republicans (17 percent). The ACA is the second most frequently mentioned health care issue among partisans, with Democrats saying they want to see Congress “protecting or improving the ACA” while Republicans say they want to see the next Congress “repealing the ACA.” Independents are divided on this issue, with similar shares saying they want to see Congress repealing and protecting the 2010 health care law.

Figure 3: Cost And Affordability Top Public’s Health Care Priorities For Next Congress

Figure 3: Cost And Affordability Top Public’s Health Care Priorities For Next Congress

While there appears to be consensus among the public on what health care issue they want to see Congress work on next year, not quite one-third are confident that Democrats and Republicans in Congress will be able to work together on bipartisan legislation to address the health care issues facing the country. In fact, seven in ten say they are either “not very confident” (34 percent) or “not at all confident” (35 percent) that Congress will be able to work on such bipartisan legislation, while fewer are confident, either “very confident” (six percent) or “somewhat confident” (24 percent), in Congress being able to work together.

Figure 4: Less Than One-Third Are Confident Congress Can Work Together To Address Health Care Issues Facing The Country

Figure 4: Less Than One-Third Are Confident Congress Can Work Together To Address Health Care Issues Facing The Country

Democrats are slightly more confident in the ability of Democrats and Republicans in Congress to be able to work together on bipartisan health care legislation (41 percent) compared to independents (27 percent) and Republicans (19 percent); yet, a majority across party identification say they are either “not very confident” or “not at all confident” (58 percent, 72 percent, and 79 percent, respectively).

The Future of the Affordable Care Act and Medicaid Expansion

The 2018 midterm elections have major implications for both the future of the 2010 health care law known as the Affordable Care Act (ACA) as well as one of its most popular provisions – individual state’s expansion of the Medicaid program for low-income people.

The Affordable Care Act

With Democrats regaining a majority in the U.S. House of Representatives for the first time since 2010, and without continued efforts among Republicans to repeal the ACA, the latest KFF Tracking Poll finds a slight uptick in the public’s view of the law with 53 percent saying they view law favorably compared to four in ten who have an unfavorable view of the law. This slight shift is largely driven by Democrats with about eight in ten saying they have a favorable opinion of the law, including about half (48 percent) who have a “very favorable” view. Similarly, three-fourths of Republicans (76 percent) continue to view the law unfavorably with more than half (54 percent) saying they have a “very unfavorable” opinion of the law.

Figure 5: Post-Election Tracking Poll Finds Slight Uptick in ACA Favorability, Largely Driven By Democrats

Figure 5: Post-Election Tracking Poll Finds Slight Uptick in ACA Favorability, Largely Driven By Democrats

AMERICANS CONTINUE TO HOLD FAVORABLE OPINIONS OF ACA PROVISIONS

Similar to previous KFF Tracking Polls, many of the ACA’s provisions continue to be quite popular, even across party lines. A majority of the public – regardless of party identification – hold favorable views of all of the ACA’s provisions with one exception (fewer than half of Republicans say they have a favorable opinion of the Medicare payroll tax increases on earnings for upper-income Americans).

Table 2: Americans’ Opinions of ACA Provisions
Percent who say they have a FAVORABLE opinion of each of the following provisions of the law: Total Democrats Independents Republicans
Allows young adults to stay on their parents’ insurance plans until age 26 82% 90% 82% 66%
Creates health insurance exchanges where small businesses and people can shop for insurance and compare prices and benefits 82 91 78 71
Provides financial help to low- and moderate-income Americans who don’t get insurance through their jobs to help them purchase coverage 81 92 82 63
Gradually closes the Medicare prescription drug “doughnut hole” so people on Medicare will no longer be required to pay the full cost of their medications 81 85 82 80
Eliminates out-of-pocket costs for many preventive services 79 88 78 68
Gives states the option of expanding their existing Medicaid program to cover more low-income, uninsured adults 77 91 77 55
Requires employers with 50 or more employees to pay a fine if they don’t offer health insurance 69 88 61 56
Prohibits insurance companies from denying coverage because of a person’s medical history 65 70 66 58
Increases the Medicare payroll tax on earnings for upper-income Americans 65 77 69 42
Note. Some items asked of half samples.

In previous KFF Health Tracking Polls, one of the ACA’s provisions – the individual mandate which required nearly all Americans have health insurance or pay a fine – was consistently viewed unfavorably by a majority of the public. As part of the federal tax bill passed in 2017, Congress zeroed out the dollar amount and percentage of income penalties imposed by the individual mandate. Overall, three in ten Americans (31 percent) are aware that Congress has gotten rid of the penalty for not having health insurance, while four in ten (38 percent) incorrectly say Congress has not gotten rid of this penalty and an additional three in ten (31 percent) are unsure. The results are similar among those under 65 years old who either buy their own insurance or are currently uninsured with three in ten (31 percent) aware Congress has gotten rid of the penalty for not having health insurance.

Figure 6: Most Americans Are Not Aware Congress Has Gotten Rid Of The Penalty For Not Having Health Insurance

Figure 6: Most Americans Are Not Aware Congress Has Gotten Rid Of The Penalty For Not Having Health Insurance

Medicaid Expansion

Three states (Idaho, Nebraska, and Utah) voted during the 2018 election to expand their Medicaid program to cover more low-income residents, bringing the total number of states that have expanded their Medicaid programs to 37 states including Washington, D.C. Overall, about three-fourths of the public – including 77 percent of those living in non-expansion states – have a favorable view of the ACA’s provision that gives states the option of expanding their existing Medicaid program to cover more low-income, uninsured adults. In addition, a majority (59 percent) of those living in non-expansion states would like to see their state expand Medicaid to cover more low-income uninsured people while one-third (34 percent) say they want to see their state keep Medicaid as it is today. A majority of Democrats and Democratic-leaning independents say they want to see their state expand Medicaid (84 percent) while most Republicans and Republican-leaning independents want to see their state keep Medicaid as it is today (65 percent).

Figure 7: Majority Of Residents In Non-Expansion States Want Their State To Expand Their Medicaid Programs

Figure 7: Majority Of Residents In Non-Expansion States Want Their State To Expand Their Medicaid Programs

Among those living in states without Medicaid expansion who want to see their state expand their Medicaid program, nearly nine in ten (51 percent of all residents living in non-expansion states) say that if their governor and state government choose not to expand Medicaid, voters themselves should be able to decide if their state expands Medicaid.

The ACA’s 2019 Open Enrollment Period

The ACA’s sixth open enrollment period for individuals who purchase health plans on their own began on November 2, 2018 and closes in most states on December 15, 2018.1 According to the Centers for Medicare and Medicaid Services, as of November 21, 2018, 1.9 million people have signed up for insurance through the federal marketplace, which is slightly less than in previous years.2

The most recent KFF Tracking Poll finds a majority of the group most directly affected by open enrollment (those 18-64 years old who either purchase their own insurance or are currently uninsured) are unaware of the current open enrollment deadlines. About one-fourth (24 percent) of this group is aware of the current deadline to buy insurance for 2019 while six in ten (61 percent) say they “do not know” the deadline and 16 percent either offer the wrong date, incorrectly say there is no deadline or that the deadline has passed, or refuse to answer the question.

Figure 8: About One-Fourth Of Those Who Buy Their Own Insurance Or Are Uninsured Know Current Open Enrollment Deadline

Figure 8: About One-Fourth Of Those Who Buy Their Own Insurance Or Are Uninsured Know Current Open Enrollment Deadline

Slightly less than half (45 percent) of those 18-64 who either purchase their own insurance or are currently uninsured, say they have heard or seen any ads in the past thirty days from an insurance company attempting to sell health insurance. Fewer – about three in ten (31 percent) say they have heard or seen any information about how to get health insurance under the health care law.

IT IS STILL UNCLEAR HOW TWO MAJOR CHANGES TO ACA MARKETPLACES WILL AFFECT OPEN ENROLLMENT

This year’s open enrollment period has two major changes brought about by Republicans and President Trump’s administration: the removal of the penalty for not having health insurance and the introduction of short-term health insurance plans. About half of 18-64 year olds who buy their own insurance or are currently uninsured say they plan to buy their own insurance in 2019, despite the elimination of the fine for people who don’t have health insurance, while four in ten (42 percent) say they will choose to go without coverage in 2019.

Figure 9: Unclear How Changes To Individual Mandate Penalty And New Short-Term Plans May Affect Open Enrollment

Figure 9: Unclear How Changes To Individual Mandate Penalty And New Short-Term Plans May Affect Open Enrollment

One option available to those who buy their own insurance that would not have satisfied the ACA individual mandate in previous years are short-term health insurance plans. These plans cost significantly less than ACA-compliant plans but provide fewer benefits and may not pay for care for some pre-existing medical conditions.3 About one-fifth (21 percent) of those under the age of 65 who buy their own insurance or are currently uninsured say that if they had the opportunity, they would want to purchase a short-term plan. Seven in ten say they would either continue going without coverage or keep the plan they have now.

Public Support Trump Administration’s Actions on Prescription Drug Advertisements, Divided on Actions Aimed at Women’s Health and Pre-Existing Coverage

In recent months, the Trump administration has announced several actions aimed at different aspects of the U.S. health care system. The most recent KFF Tracking Poll finds the public supports the Trump administration’s proposed actions on prescription drug advertisements, even after hearing counter-arguments. The public is more divided on the administration’s actions on women’s health and protections for people with pre-existing conditions.

PRESCRIPTION DRUG ADVERTISEMENTS

Earlier this year, President Trump announced a series of ideas aimed at lowering the price of prescription drugs. One of its key elements is to require drug manufacturers to publish list prices for their prescription drugs in television advertisements. About three-fourths (77 percent) favor the federal government requiring prescription drug advertisements to include a statement about how much the drug costs. In a rare instance of bipartisanship, this policy proposal is supported by a majority of Democrats (80 percent), independents (74 percent) and Republicans (77 percent).

Figure 10: Large Shares, Regardless Of Party, Favor Requiring Prescription Drug Advertisements To Include Pricing Information

Figure 10: Large Shares, Regardless Of Party, Favor Requiring Prescription Drug Advertisements To Include Pricing Information

After President Trump announced this proposal, there was some debate about how this could be implemented with opponents saying that since people often pay different prices for the same drug based on the type of insurance they have, including a price in a drug advertisement could be confusing to consumers. About one-fifth of those who originally supported this proposal change their minds after hearing this counter-argument, leaving a slight majority of the public (53 percent) continuing to support this proposal. On the other side of the debate, nearly half of those (7 percent of total) who originally opposed this proposal change their minds after hearing that putting the price of a drug in an advertisement would put pressure on drug companies to lower their prices.

Figure 11: Majority Of The Public Continue To Favor Putting Prices In Drug Advertisements Even After Hearing Counter-Arguments

Figure 11: Majority Of The Public Continue To Favor Putting Prices In Drug Advertisements Even After Hearing Counter-Arguments

EMPLOYER EXEMPTION FROM COVERING BIRTH CONTROL

On November 15, 2018, the Trump Administration issued final regulations expanding the types of employers that may be exempt from the Affordable Care Act’s (ACA) contraceptive coverage requirement to all nonprofit and closely-held for-profit employers with objections to contraceptive coverage based on religious beliefs or moral convictions, including private institutions of higher education that issue student health plans.4 Overall, six in ten (57 percent) of the public, including most women, oppose allowing employers to be exempt from the requirement to cover the full cost of prescription birth control in their plans if they object to it for religious or moral reasons.

Figure 12: Majorities Across Groups – Except For Republicans – Oppose Allowing Employers To Be Exempt From Covering Birth Control

Figure 12: Majorities Across Groups – Except For Republicans – Oppose Allowing Employers To Be Exempt From Covering Birth Control

Few individuals, on either side of the debate, change their minds about employers being exempt from covering the cost of prescription birth control for religious or moral reasons after hearing counter-arguments. About one-fourth (9 percent of total) change their minds and now oppose employer exemptions after hearing that this means some women would not be able to afford birth control. On the other side of the argument, one in eight (7 percent of total) now favor this exemption if they heard that some business owners feel like they are being forced to pay for a benefit that violates their religious or moral beliefs.

Figure 13: Few, On Either Side Of Debate, Change Minds About Employer Birth Control Coverage After Hearing Counter-Arguments

Figure 13: Few, On Either Side Of Debate, Change Minds About Employer Birth Control Coverage After Hearing Counter-Arguments

PROTECTIONS FOR PEOPLE WITH PRE-EXISTING MEDICAL CONDITIONS

In June 2018, President Trump’s administration announced – as part of a lawsuit known as Texas v. United States, brought by 20 Republican state attorneys general – it will no longer defend the ACA’s protections for people with pre-existing medical conditions. These provisions prohibit insurance companies from denying coverage based on a person’s medical history (known as guaranteed issue), and prohibit insurance companies from charging those with pre-existing conditions more for coverage (known as community rating). The impending suit, Texas v. United States, will decide, among other things, whether both of these protections are unconstitutional and if they will be deemed invalid beginning on January 1, 2019.

The majority of the public say it is “very important” to them that the ACA’s provisions protecting those with pre-existing conditions remain law even after hearing that these protections may have led to increased insurance costs for some healthy people. Sixty-five percent of the public say it is “very important” to them that the provision that prohibits health insurance companies from denying coverage because of a person’s medical history remains law. An additional fifth (22 percent) say it is “somewhat important” this provision remains law. Similarly, about six in ten say it is “very important” that the provision that prohibits health insurance companies from charging sick people more remains law, while an additional one in five (22 percent) say it is “somewhat important.”

Figure 14: Majorities Say Pre-Existing Condition Protections Are Very Important To Them

Figure 14: Majorities Say Pre-Existing Condition Protections Are Very Important To Them

If the judge ruling on Texas v. United States decides the ACA’s protections for people with pre-existing conditions are unconstitutional, a majority of the public – including 87 percent of Democrats, 67 percent of independents, and about half of Republicans – say they would want their state to establish protections for people with pre-existing health conditions, even if this means some healthy people may pay more for coverage.

Figure 15: Majorities Say They Would Support State Action If ACA’s Pre-Existing Condition Protections Are Ruled Unconstitutional

Figure 15: Majorities Say They Would Support State Action If ACA’s Pre-Existing Condition Protections Are Ruled Unconstitutional

 

 

Patient Perception of Hospital Affiliations Influences Care

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Hospital affiliation and healthcare mergers

About 85 percent of individuals said they would forgo local care and travel one hour based on hospital affiliation with a top-ranked system, a study reveals.

Hospital affiliations can influence patient volume, a new study by the Yale Cancer Center shows.

The study recently published in the journal Annals of Surgical Oncology revealed that 85 percent of individuals about to receive complex cancer surgery would travel one hour away to receive care at a top-ranked hospital specializing in cancer care. The respondents said they would travel to a top-ranked affiliated hospital rather than go to their local hospital.

However, almost one-third of the respondents (31 percent) would change their mind about where to seek care if their local hospital was affiliated with a top-ranked hospital or system.

Researchers at Yale Cancer Center explained that the trend in where patients seek care indicated that individuals believe that hospital affiliation with top-rank hospitals means that both hospitals – the top-ranked and affiliate organizations – offer similar quality care. And about one-half of the 1,000 individuals surveyed said that safety and quality of care were identical at both the top=ranked and affiliate hospitals.

But the perception that top-ranked hospitals and their affiliates offer the same level of care quality is not necessarily true, researchers warned.

“There is no evidence that the care is the same, and no regulation that governs the advertising and marketing of these affiliations,” explained the study’s senior author, Daniel J. Boffa, MD, professor of surgery (thoracic surgery), program leader of the Thoracic Oncology Program at Smilow Cancer Hospital at Yale Cancer Center, and investigator at Yale’s Cancer Outcomes, Public Policy, and Effectiveness Research Center (COPPER).

Boffa and his colleagues further investigated how brand-sharing, like hospital affiliations, via the internet impact an individual’s healthcare decision-making process. Researchers asked the over 1,000 individuals about their hospital preferences for complex cancer surgery between large top-ranked organizations and small, local hospitals.

When researchers asked the respondents to compare top-ranked and small hospitals, the survey showed:

  • 47 percent of respondents said that surgical safety, 66 percent felt that guideline compliance, and 53 percent reported cure rates would be the same at both hospitals
  • 47 percent of respondents thought that the surgical care at a top-ranked hospital and its affiliates would be the same across all four safety features (rate of complications, readmissions rate, length of stay, and postoperative mortality rate)
  • 44 percent of respondents thought the affiliated hospital would be the same in terms of surgical quality standards, including surgical cure rate

“It is completely understandable that the public would make assumptions that hospitals advertising the same name offer the same care,” Boffa stated in a press release. “Some hospital advertising could be even be interpreted as encouraging this line of thinking.”

“The truth is that we do not yet know if care received at an affiliated hospital is the same as care at the brand name center, whether that is for complex cancer care or other procedures,” he continued. “Currently hospitals are free to share their brand with almost any hospital they choose. The hospitals are not required to inform patients of any differences in the quality or safety of care provided by the different hospitals within a network. This study suggests that the public is making assumptions in care equality that are potentially influencing their choice for hospital care.”

The perception about hospital affiliations could be problematic for the healthcare industry as providers rapidly consolidate.

Healthcare organizations announced 115 merger and acquisition transactions in 2017, consulting firm Kaufman Hall reported. And that was the highest number of transactions in recent history, the firm pointed out.

2018 is likely to meet or even exceed the number of healthcare mergers and acquisitions, healthcare experts predict. For example, recent data from Kaufman Hall show 255 healthcare merger and acquisition deals announced in the second quarter of 2018.

Many leaders of healthcare organizations engaging in a merger and/or acquisition claim the deal will improve care quality while lowering costs for patients.

But Boffa et al. pointed out that care quality may not necessarily be the same across affiliate hospitals, creating confusion among individuals seeking high-quality, low-cost care.

“I see these findings as a wake-up call to the medical community to investigate if there are important differences in care between affiliated hospitals and their mother ship, as well as a wake-up call to name brand medical centers to take ownership for outcomes at hospitals that share their names,” Boffa stated.

“What is known is that the issue of where to receive complex cancer care is seen as crucial to patient outcome,” he added. “Studies have found that the quality and safety of such complex cancer care is particularly prone to outcome variability across hospitals, and the risk of dying after an operation can be up to four times greater at hospitals that perform procedures infrequently. Yet other data suggests that, in general, outcomes at top-ranked hospitals can vary widely, and are not always superior to non-ranked hospitals.”

Hospital affiliations, however, do have the potential to increase patient access to high quality care, the researchers elaborated. But stakeholders need to provide patients with quality of care data to help them make informed healthcare decisions.

“To our knowledge, this is the first survey to focus on the difference in the public’s perception of care between these two environments, but it is likely that affiliation status and co-branding has already impacted the distribution of patients across the healthcare spectrum,” Boffa said. “The development of affiliations could, potentially, bring cancer expertise closer to patients— but without facts that is just a theory.”

 

Hospital Operating Income Falls for Two-Thirds of Health Systems

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Hospital operating income and health systems

Hospital expenses are rising faster than revenue growth for health systems, resulting in declining operating income.

Health system operating income is deteriorating as hospital expenses continue to grow, according to a recent Navigant analysis.

In the three-year analysis of the financial disclosures for 104 prominent health systems that operate almost one-half of US hospitals, the healthcare consulting firm found that two-thirds of the organization saw operating income fall from FY 2015 to FY 2017. Twenty-two of these health systems had three-year operating income reductions of over $100 million each.

Furthermore, 27 percent of the health systems analyzes lost revenue on operations in at least one of the three years analyzed and 11 percent reported negative margins all three years.

In total, health systems facing operating earnings reductions lost $6.8 billion during the period, representing a 44 percent reduction.

Rapidly growing hospital expenses as the primary driver of declining operating margins, Navigant reported. Hospital expenses increased three percentage points faster hospital revenue from 2015 to 2017. Top-line operating revenue growth decreased from seven percent in 2015 to 5.5 percent by 2017.

Hospital revenue growth slowed during the period because demand went down for key hospital services, like surgery and inpatient admissions, Navigant explained.

Many of the revenue-generating services hospitals rely on are under the microscope. Policymakers and healthcare leaders are particularly looking to decrease the number of hospital admissions and safely shift inpatient surgeries to less expensive outpatient settings.

In exchange, Medicare and other leading payers are reimbursing hospitals for decreasing admissions or readmissions and their performance on other value-based metrics.

The shift to value-based reimbursement, however, is slow and steady, with just over one-third of healthcare payments currently linked to an alternative payment model. Hospitals and health systems are still learning to navigate the new payment landscape while keeping their revenue growing.

Value-based contracts also failed to deliver sufficient patient volume to counteract the discounts given to payers, Navigant added.

According to the firm, other factors contributing to a slowdown in hospital revenue growth included a decline in collection rates for private accounts and reductions in Medicare reimbursement updates because of the Affordable Care Act and the 2012 federal budget sequester.

“Because of reductions in Medicare updates from ACA and the sequester, hospital losses in treating Medicare patients rose from $20.1 billion in 2010 to $48.8 billion in 2016, according to American Hospital Association analyses,” the report stated. “The sharp $7.2 billion deterioration in Medicare margins that occurred from 2015 to 2016 surely contributed to the reduction in hospital operating margins in the same year of this analysis.”

While hospital revenue growth slowed, hospital expenses sharply rose as healthcare organizations invested in new technologies. Value-based reimbursement, federal requirements, and other components of the Affordable Care Act prompted hospitals to make strategic investments in EHRs, physicians, and population health management, causing expenses to increase, Navigant stated.

Key strategic investments made by hospitals and health systems included:

  • Compliance with the 2009 Health Information Technology for Economic and Clinical Health (HITECH) Act, which requires certified EHR implementation in hospitals and affiliated physician practices
  • Compliance with Medicare payment reform initiatives, such as accountable care organizations (ACOs) or pay-for-performance programs
  • Participation in new value-based contracts with payers
  • Establishment of employed physician groups or clinically integrated networks to develop the capabilities needed for compliance with performance- or value-based initiatives

“In addition to these strategic investments, other factors drove up routine patient care expenses, including a nursing shortage that increased nursing wages and agency expenses; specialty drug costs, particularly for chemotherapeutic agents; and, for some systems, recalibration of retirement fund costs,” the report stated.

The shift to value-based reimbursement and all of its accompanying policies will be the “new normal,” and hospitals should expect the low rate of revenue growth to persist, Navigant stated.

But hospitals and health systems can withstand the economic downturn by achieving strategic discipline and operational excellence, the firm advised.

“Systems must be disciplined to invest their growth capital in areas of actual reachable demand; that is, matched to the growth potential in the specific local markets the system serves,” the report stated. For example, creating a Kaiser-like closed panel capitated health offering in markets where there is no employer or health plan interest in buying such a product is a waste of scarce capital and management bandwidth.”

In line with strategic discipline, organizations will need to “prune” their owned assets portfolio by improving the utilization of their clinical capacity and growing patient throughput. Health systems can achieve this by focusing on scheduling and staffing, ensuring adherence to clinical pathways, streamlining discharges and care transitions, and adjusting physical capacity to actual demand.

The tools used to succeed in value-based contracts should also be applied to Medicare lines of business to reduce Medicare operating losses.

Additionally, vertical alignment will be key to weathering falling operating earnings, Navigant explained.

“Revenue growth is more likely to occur around the edges of the hospital’s core services — inpatient care, surgery, and imaging — rather than from those services themselves,” the report stated. “Creatively repackaging services like care management that is presently imbedded in every aspect of clinical operations, and finding retail demand for services presently bundled as part of the hospital’s traditional service offerings, represent such edge opportunities.”

Reducing patient leakage in multi-specialty groups and systems through improved referral patterns, scheduling, or care coordination will help to grow revenue and keep it within the system.

“To achieve better performance, health system management and boards must take a fresh look at their strategy considering local market realities. They need to look closely at the markets they serve, and size and target their offerings to actual market demand,” the report concluded. “They must re-examine and rationalize their portfolio of assets and demand marked improvements in efficiency and effectiveness, and measurable value creation for those who pay for care, particularly their patients. Since much of this should have been done five years ago, time is of the essence.”