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Implementing Health Reform: Tax Form Instructions


August 29th, 2014

On August 28, 2014, the Internal Revenue Service re-released the draft forms that will be used by employer, insurers, and exchanges for reporting Affordable Care Act tax information to individuals and to the IRS for 2014 and 2015, as well as the instructions for completing those forms.  The IRS also released in the Federal Register requests for public comments on three of those forms – the 1094-Bthe 1094-C, and the 1095-C – under the Paperwork Reduction Act.  This post reports on these forms and instructions and on a guidance released by the Centers for Medicare and Medicaid Services.

The tax forms had been published earlier and are described in an earlier post.  The instructions for the forms, however, had not been available and had been eagerly awaited by employers, insurers, exchanges, and tax professionals. Forms 1094-C and 1095-C will be used by large employers with more than 50 full-time or full-time-equivalent employees to determine whether the employer is responsible for penalties under the employer shared responsibility requirements of the ACA.  They will also be used to determine whether employees have received an affordable and adequate offer of coverage, rendering them ineligible for premium tax credits.  Employers are required to provide each full-time employee with a form 1095-C and to file each of these together with a transmittal form 1095-B form with the IRS.

The instructions for the 1094-C and 1095-C are by far the most complex of the instructions released on August 28, filling 13 pages with dense, two column, print.  Most of the complexity derives from the options for complying with the employer mandate and the transition exceptions to that mandate that the administration has created.  These alternatives and exceptions were explored in my posts on the employer mandate final rule when it was issued in February, 2014.  These forms are also complicated by the fact that the IRS decided to allow self-insured large employers to file only the large employer 1094-C and 1095-C, rather than requiring them to also fill out the 1094-B and 1095-B forms, which are filed by other entities that provide minimum essential coverage.  Because the employer mandate has been delayed, large employers are not required to file these forms for 2014, although they may do so voluntarily.

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Health Affairs Forum: Graduate Medical Education Governance And Financing


August 29th, 2014

Please join us on Wednesday, September 10, for a Health Affairs forum to discuss, Graduate Medical Education That Meets the Nation’s Health Needs, a recent report from the Institute of Medicine (IOM) Committee on the Governance and Financing of Graduate Medical Education (GME). Health Affairs Founding Editor John Iglehart will host the event.

For the past two years, the committee – co-chaired by former CMS and HCFA administrators Donald Berwick and Gail Wilensky – conducted an independent review of the governing and financing of the GME system, and the report is a roadmap for policymakers for repairing and improving its deficiencies. The Health Affairs forum is one of the first opportunities interested parties will have to gather in a public setting to discuss and debate the committee’s proposals.

WHEN
Wednesday, September 10, 2014
9:00 a.m. – 12:00 p.m.

WHERE
National Press Club
529 14th Street NW
Washington, DC, 13th Floor

REGISTER NOW

Follow Live Tweets from the briefing @Health_Affairs, and join in the conversation with #HA_GME.

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State-Based Marketplaces: Leveraging Year-One Lessons To Boost Year-Two Enrollment


August 27th, 2014

In three months, consumers will log onto their state’s health insurance marketplace to investigate their options and enroll in a plan. Already, states are hard at work prepping for the second year of open enrollment, which begins November 15. State marketplaces are expected to increase the number of enrollees this year and adopting lessons from 2013-2014 can help.

A User-Friendly Marketplace

First and foremost, states need a user-friendly marketplace that functions properly and allows consumers, brokers, insurers and navigators to seek and provide information that is timely and credible. States know this, but recently, interviews with 100 staff from five successful state-based marketplaces (SBMs) unearthed several less obvious lessons.

To begin, states should move from last year’s ‘shotgun’ marketing that helped build awareness to a more targeted approach to outreach this year. In addition to some mass marketing to maintain awareness, states should target advertising dollars to high-priority segments and focus on less expensive tools, like direct mailing campaigns and walk-up enrollment centers, which proved to be most effective last year.

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Rescue Me: The Challenge Of Compassionate Use In The Social Media Era


August 27th, 2014

The Development of Brincidofovir and its Possible Use to Treat Josh Hardy

Last March 4, seven-year old Josh Hardy lay critically ill in the intensive care unit at St Jude Children’s Hospital in Memphis, Tennessee with a life-threatening adenovirus infection. His weakened immune system was unable to control the infection, a complication of a bone marrow stem cell transplant he needed as a result of treatments for several different cancers since he was 9 months old.

His physicians tried to treat the adenovirus with an anti-viral agent, Vistide (IV cidofovir), but had to stop due to dialysis-dependent renal failure. They were aware of another anti-viral in Phase 3 clinical development, brincidofovir, an oral compound chemically related to Vistide. In earlier clinical testing brincidofovir had shown the potential for enhanced antiviral potency and a more favorable safety profile.

Chimerix (where one of us, Moch, was CEO), a 55 person North Carolina-based biopharmaceutical company, had previously made brincidofovir available to more than 430 critically ill patients in an expanded access program for the treatment of serious or life-threatening DNA viral infections, including adenovirus as well as herpes viruses (such as cytomegalovirus) and polyomaviruses.  This program started in 2009 as a series of individual physician-sponsored emergency INDs — investigational new drug exemptions issued in physician-certified compassionate use situations.

The program evolved via word of mouth to the extent that brincidofovir was made available under emergency INDs for more than 215 patients. During 2011, Chimerix received funding from Health and Human Service’s Biomedical Advanced Research and Development Authority (BARDA) to provide brincidofovir to an additional 215 critically ill patients for the purpose of gaining insights into the potential use of brincidofovir as a medical countermeasure against smallpox. (Department of Health and Human Services Contract No. HHSO100201100013C.  For further information on brincidofovir Study CMX001-350, see ClinicalTrials.gov Identifier NCT01143181.)

When BARDA funding ended in 2012, Chimerix stopped accepting new requests for compassionate use under its expanded access program. Although requests continued from physicians around the world, the company decided that it was in the best interests of the greatest number of patients to devote its limited human and financial resources to the clinical development pathway necessary for FDA approval of brincidofovir.

This post examines the implications of the ultimately successful campaign waged by Josh Hardy’s family to obtain access to brincidofovir for their son. We discuss several issues raised by the Hardy case, including the overarching question of whether it is fair for social media or influence of any form to play a role in determining which patients get access to experimental treatments; whether rescuing individual patients in need can be reconciled with an evidence-based regulatory approval process for new therapies; and whether there is a duty to “rescue” terminally ill patients by paying for access to experimental therapies.

Finally, we propose a new framework for regulating access to experimental treatments.

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The 125 Percent Solution: Fixing Variations In Health Care Prices


August 26th, 2014

Summer vacation’s finally here. You’re strolling along the beach, not a care in the world when – ouch – you step on a piece of broken glass and need a few stitches at the local hospital. Such routine procedures are painless enough, but depending on where you’re treated and by whom, the real pain could occur when you’re handed the ER bill.

In some of the latest evidence on the crazy-quilt patterns of U.S. health care prices, Castlight Health found prices in Dallas TX ranging from $15 to $343 for the same cholesterol test.  What makes these price variations particularly egregious is that the highest prices are typically reserved for those least able to pay, such as the uninsured.

What’s the solution?  In the long run, we need to establish a more transparent system where consumers can choose easily based on reliable quality and price measures.  But our current measures of quality are, to put it politely, inadequate, and people with insurance are often insulated or can generally afford those higher prices.  Reference pricing, in which insurance pays only enough to reimburse providers with adequate quality and relatively lower costs, would help to restrain high prices, but distracted patients or those with strong attachments to specific doctors or hospitals could still get stung with a big bill.

Capping payments at 125 percent of Medicare rates. We suggest a short-term solution: The federal Medicare program has in place a complete system of prices for every procedure and treatment.  It’s not perfect, but it is uniform across regions, with a cost-of-living adjustment that pays more in expensive cities and less in rural areas.  If every patient and every insurance company always had the option of paying 125 percent of the Medicare price for any service, we would effectively cap the worst of the price spikes.  No longer would the tourist checked out at the ER for heat stroke be clobbered with a sky-high bill.  Nor would the uninsured single mother be charged 10 times the best price for her child’s asthma care.  This is not just another government regulation, but instead a protection plan that shields consumers from excessive market power.

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Partnership And Progress On The Path To Achieving Millennium Development Goal 6


August 25th, 2014

Editor’s note: For more on global health, stay tuned for the upcoming September issue of Health Affairs.

In 2000, nearly 200 world leaders came together and agreed on a set of objectives intended to tackle some of the most pressing development challenges of our time, such as poverty, AIDS, and child mortality. With a target date of December 31, 2015, the Millennium Development Goals (MDGs) provided a clear path for progress and a platform for immediate action. Last week, on August 18, we reached a milestone on that path –- as of that date, 500 days remained to achieve these eight goals. So where do we stand, and what more must be done?

Combatting HIV/AIDS, Malaria, and Other Diseases

For those of us focused acutely on MDG number 6—combatting HIV/AIDS, malaria, and other diseases—the recent Millennium Development Goals Report had encouraging news. An estimated 3.3 million deaths from malaria were averted between 2000 and 2012 due to the expansion of malaria interventions, and efforts to fight tuberculosis have saved an estimated 22 million lives since 1995.

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Health Policy Brief: The Relative Contribution Of Multiple Determinants To Health Outcomes


August 22nd, 2014

A new Health Policy Brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) examines factors that can contribute to health status. In the United States, less than 9 percent of health expenditures go to disease prevention, and there is little support for social services, such as programs for older adults, housing, and employment programs.

This brief focuses on “multiple determinant” studies that seek to quantify the relative influence of some of these factors on health. It is part of a larger project, supported by the Robert Wood Johnson Foundation, which aims to create a structure for conducting analyses that demonstrate the value of investments in nonclinical primary prevention and their impact on health care costs.

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Health Affairs Briefing: Advancing Global Health Policy


August 22nd, 2014

Please join us on Monday, September 8, when Health Affairs Editor-in-Chief Alan Weil will host a briefing to discuss our September 2014 thematic issue, “Advancing Global Health Policy.”  In an expansion of last year’s theme, “The ‘Triple Aim’ Goes Global,” we explore how developing and industrialized countries around the world are confronting challenges and learning from each other on three aims: cost, quality, and population health.

A highlight of the event will be a discussion of international health policy—led by Weil—featuring former CMS and FDA administrator and current Brookings Institution Senior Fellow Mark McClellan and Lord Ara Darzi, surgeon, scholar, and former UK Health Minister. Additional panels will look at how countries are transforming chronic care, lowering costs, and redesigning delivery systems.

WHEN: 
Monday, September 8, 2014
9:00 a.m. – 12:30 p.m.

WHERE: 
National Press Club
529 14th Street NW
Washington, DC, 13th Floor

REGISTER NOW!

Follow Live Tweets from the briefing @HA_Events, and join in the conversation with #HA_GlobalHealth.

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The “Failure” Of Bundled Payment: The Importance Of Consumer Incentives


August 21st, 2014

Bundled payment for orthopedic and spine surgery and other major acute interventions has many attractive features, in principle. But implementation has been difficult in practice.  The recent Health Affairs paper by Susan Ridgley and colleagues, and the Health Affairs Blog commentary by Tom Williams and Jill Yegian, list quite a few practical implementation problems, and the points raised in both these pieces are well taken.

As leaders in the Integrated Health Association (IHA) bundled payment initiative, we shared the same hopes, devoted the same energies, and share the same frustrations with the modest results.  We feel it is important to emphasize what we consider to be the initiative’s most important design failure: the lack of engagement and alignment on the part of the consumer.  No one will ever reform the U.S. health care system without bringing the consumer along and, indeed, placing consumer choice and accountability at the very center of the reform initiative.

On an optimistic note, this design failure is being addressed by the larger health care marketplace in the wake of numerous failed attempts to reform health care by focusing exclusively on provider payment and incentives.

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Key Success Factors For the Medicare Shared Savings Program


August 21st, 2014

In January 2012 the Centers for Medicare & Medicaid Services (CMS) officially launched the Medicare Shared Savings Program (MSSP) for the formation of national Accountable Care Organizations (ACOs). Early participants were charged with bringing the theory of accountable care into practice.

Premier, a national healthcare improvement alliance of hospitals and health systems, created a population health collaborative in 2010 designed to assist providers with developing and implementing successful ACOs both in the public and private sectors.

Thus far, the Premier collaborative has advised nearly 30 MSSP applicants, and is working with another 30 more, on how to structure and manage an effective ACO. Through benchmarking tools, financial models, the sharing of best (and worst) practices, etc., members of the Premier PACT Collaborative have outperformed the national MSSP cohort.

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The Role Of Black Box Warnings In Safe Prescribing Practices


August 20th, 2014

In the Health Affairs article, “Era of Faster Drug Approval Has Also Seen Increased Black-Box Warnings and Market Withdrawals,” published in the August issue, Cassie Frank and coauthors compare the number of approved prescription drugs that received black-box warnings or were withdrawn from the market for safety-related reasons prior to the 1992 Prescription Drug User Fee Act (PDUFA) with black-box warnings and safety-related withdrawals in the post-PDUFA era.

PDUFA for the first time authorized FDA to collect user fees from brand-name manufacturers that submitted New Drug Applications, with the funds being earmarked for more review staff (not until 2007 were funds also permitted to be used to expand post-approval safety surveillance capacity).

As a quid pro quo, the FDA was required to act on all new drugs within a fixed deadline: drugs given priority review designations because they were particularly promising therapies offering substantial improvements in treating serious conditions were to be reviewed within 6 months and standard review drugs were to be reviewed within 12 months (later shortened to 10 months in 2002). By all accounts, PDUFA substantially expedited the review process. The review times for new molecular entities decreased from an average of 33.6 months between 1978 and 1986 to about 10 months for drugs approved between 2001-2010.

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Whither CHIP?


August 19th, 2014

In a day all but lost to Affordable Care Act prehistory, on November 7, 2009, the House of Representatives passed the Affordable Health Care for America Act. Among the bill’s many differences with its Senate counterpart, it would have allowed the Children’s Health Insurance Program (CHIP) to expire at the end of 2013, with children covered under that program enrolled in either Medicaid or commercial Exchange plans.

On December 24, the Senate passed the Patient Protection and Affordable Care Act (ACA). Their bill extended CHIP through fiscal year 2015 while, curiously, enhancing the Federal match rate for the program beyond that date and instituting a maintenance of effort (MOE) requirement for states to keep CHIP kids covered through 2019.

At the time, drafters of the respective chamber’s versions of health reform anticipated heading to conference to negotiate and resolve their differences, with the disposition of CHIP one of the top considerations.

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The Latest Health Wonk Review


August 15th, 2014

At Wright on Health, Brad Wright offers some health policy insight in his August recess edition of the health wonk review. Brad highlights the Health Affairs Blog post by Jon Kingsdale and Julia Lerche on the “one-two punch” threatening the ACA’s second open enrollment period, as well as a variety of other great posts. 

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Remembering Jessie Gruman


August 15th, 2014

Jessie Gruman, founding president of the Center for Advancing Health, died on July 14 after a fifth bout with cancer. Jessie was a hero to patients, families, and health care providers for her selfless work to help people better understand their role and responsibilities in supporting their own health.

Jessie was an extraordinary soul and a pioneering activist in the person-centered care movement. She used her personal experience with illness to inspire a life’s work aimed at developing practical resources that support peoples’ engagement with their health care. She improved care and improved lives.

Jessie was first diagnosed with cancer at the age of twenty. She was thrown into a world that spoke in a foreign tongue: “medicalese.” She was expected to self-administer a complex medication regime, which she openly admits she sometimes skipped. Jessie described the hard-working health care professionals who fought to make her better all relying on her, a scared twenty-year-old, to understand what they said and implement their plan. She realized the enormous power of people who are engaged in their own health, while also recognizing the challenges to such engagement.

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Hospital Readmission Reduction Program Reignites Debate Over Risk Adjusting Quality Measures


August 14th, 2014

Note: In addition to Eva DuGoff, Shawn Bishop and Purva Rawal also coauthored this post. 

Do safety net hospitals categorically under perform the national average in terms of managing readmissions? Or is something else triggering higher rates of readmissions in these facilities?  These questions are essential for policymakers to answer as pay-for-performance (P4P) penalties are having a disparate impact on hospitals that serve low-income areas.

Medicare’s Hospital Readmission Reduction Program (HRRP), for example,  links risk-adjusted hospital readmission rates to financial penalties. Hospitals with risk-adjusted readmission rates that fall below the national average are penalized by having their annual Medicare payments reduced by up to 2 percent. In 2015, hospital payments are scheduled to be reduced by up to 3 percent.

But the program’s current system for measuring readmission rates may be flawed. Numerous analyses have found that safety net hospitals, which care for low-income patients, are more than twice as likely to be penalized than hospitals caring for higher-income patients.

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Implementing Health Reform: ACA-Related Litigation, Special Enrollment Periods, And Navigator Certification And Training (Updated)


August 13th, 2014

Two federal district courts have issued decisions in recent days in litigation relating to the Affordable Care Act. This post will analyze those cases as well as describe two new special enrollment periods recognized by the Centers for Medicare and Medicaid Services (CMS) in guidance issued on August 4, 2014.

A decision on motion to dismiss Indiana case regarding premium tax credits in the federally facilitated exchange.  First, on August 12, 2014, Judge William T. Lawrence of the United States District Court for the Southern District of Indiana issued an opinion in Indiana v. the IRS, one of the cases challenging the legality of the Internal Revenue Service rule recognizing the issuance of premium tax credits through the federal exchanges. There are currently four cases raising this issue pending in federal courts in Oklahoma, Indiana, Virginia, and the District of Columbia.

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New Health Policy Brief: Interoperability


August 13th, 2014

A new Health Policy Brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) looks at the issue of health information exchange. The Health Information Technology for Economic and Clinical Health (HITECH) Act was signed into law at the very beginning of the Obama administration, bringing with it significant investments in health information technology (IT)—$26 billion to date.

While the adoption of electronic health records (EHRs) has increased considerably since 2009, there is very little electronic information sharing among clinicians, hospitals, and other providers. New models of care delivery, designed to improve quality and reduce costs, require both interoperable EHRs and electronic information sharing to be effective. This Health Policy Brief looks at the efforts the federal government has made to improve interoperability and increase the level of electronic information sharing, as well as the barriers to achieving these goals.

Topics covered in this brief include:

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The Evolution Of A Two-Tier Health Insurance Exchange System


August 13th, 2014

Note: In addition to Rosemarie Day, this post is also coauthored by Pamela Nadash and Angelique Hrycko.

Health reform has been a catalyst for change. It has fostered the creation of public health insurance exchanges and accelerated existing trends in health insurance coverage for employees. Many employers are reevaluating their coverage offerings, some employers are no longer providing insurance coverage, and, among those who continue to offer it, high deductible plans with restricted networks are becoming the norm.

In addition, employers are increasingly outsourcing health insurance benefits management by moving employees to private health insurance exchanges – often in combination with a shift toward a defined contribution approach. Estimates vary, but surveys show that anywhere from 9 to 45 percent of employers plan to implement private exchanges in the future.

Accenture (figure 1) has predicted that by 2018, private exchange enrollment will outpace public exchange enrollment.

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Implementing Health Reform: Medicare And The ACA Marketplaces (Updated)


August 12th, 2014

On August 1, 2014, the Centers for Medicare and Medicaid Services released a set of frequently asked questions on the relationship between Medicare and the marketplaces. This is not the first guidance CMS has published on this topic, and much of the information in the FAQ was already available. The FAQ is also quite repetitive, as it answers the same questions under different headings, such as “general enrollment FAQs” and “consumer messaging,” but does contain useful information. This post briefly summarizes the FAQ.

The FAQ emphasizes the fact that Medicare and marketplaces operate independently, with little overlap. The marketplaces do not enroll individuals in Medicare or in Medicare Advantage plans and do not sell Medicare supplement plans. Indeed, exchanges cannot legally sell coverage to Medicare beneficiaries.

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Mental Health Reform: Treating Before Stage 4


August 11th, 2014

When I talk about mental illnesses, I often point out that as a matter of public policy they are the only chronic conditions we wait until Stage 4 – the final stage in a chronic disease process – to treat, and then often only through incarceration.

To me, it is clear why this is the case. We have adopted a behavioral standard – danger to self or others – as a trigger to treatment.

But waiting until injury or death is imminent is no way to treat a chronic health condition. David Mechanic’s thoughtful Health Affairs article, “More People Than Ever Before Are Receiving Behavioral Health Care in the United States, But Gaps and Challenges Remain,” published in the recent August issue, examines the result of this Stage 4 thinking.

Beginning with “the devastating effects on the well-being of individuals, families, and communities,” Mechanic lays out the current state of mental health care in America. Mental illnesses rob individuals of both dignity and decades of life expectancy.

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