The Senate will take its first steps toward repealing the Patient Protection and Affordable Care Act (PPACA) by the end of the week, according to a Reuters report.

Speaking during a January 8 television interview, Republican Senate Majority Leader Mitch McConnell said that “there ought not to be a great gap” between repealing the act and replacing it and that Republicans would be “replacing it rapidly after repealing it.” He did not define what he meant by “rapidly.”

House Majority Whip Steve Scalise cited a previously proposed Republican bill to repeal the PPACA that laid out a two-year transition period for putting an alternative in place. “That’s a benchmark for what we’re looking at again,” he said.

Repealing the act without an immediate replacement raises questions about what happens to those who obtained insurance under the PPACA.

President Obama stated in an interview that while the act could theoretically be repealed, “suddenly 20 million people or more don’t have health insurance.”

“I think Republicans now are recognizing that may not be what the American people, including even Trump voters, are looking for,” he added.

The PPACA came under renewed criticism recently after the government disclosed that benchmark 2017 premiums would jump 25% compared with 2016. Several large health insurers have withdrawn from the market, saying they were losing money.

Obama said he expected the PPACA to survive, albeit in a modified form.

In related news, BloombergPolitics has reported that congressional Republicans are divided on whether to scrap the PPACA’s tax provisions when the act is repealed or to delay that move until a replacement is ready.

Some Republicans have announced that parts of the PPACA must go immediately––including its tax-revenue streams––because that’s what voters were promised, according to Bloomberg. But repealing the tax increases, which pay for the subsidies needed to help millions of Americans afford coverage, could make it politically impossible to pay for a replacement plan down the line.

Republican Senator Bill Cassidy of Louisiana said that if lawmakers start by repealing all of the PPACA taxes, “then you’re in a hole” when it comes to replacing the act later with an alternative that covers more people, costs less, and doesn’t add to the deficit. Most Republicans in Congress have signed pledges not to raise taxes, making raising enough revenue for a stand-alone replacement plan politically challenging.

An analysis by the Committee for a Responsible Federal Budget put the loss of revenue from repealing PPACA’s taxes at $800 billion over 10 years. It said that approximately half of that would come from removing the 0.9% Medicare payroll surtax on wages above $200,000 ($150 billion) and the 3.8% surtax on investment income above the same threshold ($250 billion). Another quarter of the revenue loss would result from repealing various fees on insurance companies, medical-device companies, and drug manufacturers.

Sources: Reuters; January 8, 2017; and BloombergPolitics; January 6, 2017.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.