WeeklyFinancingNewsPulseNationalEditionfinal20091030.pdf (PDF | 270.91 kb)
SAMHSA222s Weekly Financing News Pulse: National Edition October 30, 2009 10/30/09 1 SAMHSA222s Weekly Financing News Pulse: National Edition National News Rep. Pelosi Unveils House Democrats222 Health Care Reform Bill; Sen. Reid Says Senate Bill will Include Public Option President Obama Signs Military Spending Bill Requiring Mental Health Screenings for Returning Vets; Congressmen Propose Bill to Give Military Personnel Direct Access to Mental Health Treatment Senate Confirms Benjamin as Surgeon General Rep. Sestak Introduces Legislation to Extend the ARRA COBRA Subsidy Sen. Kaufman Introduces Bill to Increase Fundi ng for Health Care Fraud Investigation, Increase Penalties New York Attorney General Announces New Database to Calculate Out - of - Network Health Claims Four Pharmaceutical Companies Agree to Pay $124 Million to Settle Medicaid Fraud Claims SAMHSA Awards $170.5 Million to Fund Systems of Care for Mentally Ill Children and Their Families Gallup Poll Finds 44 Percent Favor Legalizing Marijuana GM Salaried Workers Offered Only High - Deductible Health Plans Studies Released Thomson Reuters Estimates U.S. Health Care System Wastes at Least $505 Billion Annually CHCS Report Analyzes High - Cost, High- Need Medicaid Beneficiaries EPI Documents Decline in Employer - Sponsored Health Insurance, Projects Further Decline Urban Institute Examines Age Rating Under Health Care Reform Bills CBPP Report Finds Finance Committee Bill222s Premium Subsidies Insufficient Commonwealth Fund Report Examines Cost of 223Medical Home224 Model SK&A Report Finds 83 Percent of Physicians Accept Medicare, 65 Percent Accept Medicaid Around the Hill: Hearings on Health Financing To Subscribe to SAMHSA222s Weekly Financing News Pulse, please go to the following link and choose 223Health Care Financing224: https://service.govdelivery.com/service/m ulti_subscribe.html?code=USSAMHSA&origin=http://www.samhsa.go v/enetwork/success.aspx For quest ions or comments, please contact Kevin Hennessy ( kevin.hennessy@samhsa.hhs.gov ). SAMHSA222s Weekly Financing News Pulse: National Edition October 30, 2009 10/30/09 2 National News Rep. Pelosi Unveils House Democrats222 Health Care Reform Bill; Sen. Reid Says Senate Bill will Include Public Option : On October 29, House Speaker Nancy Pelosi (D - CA) and House Democratic leaders unveiled a house health care reform bill, expected on the House floor the week of November 2. The legislation, which resulted from a merger of bills passed by the House Education and Labor Committee , the House Energy and Commerce Committee , and the House Ways and Means Committee , will be deficit neutral over 10 years, cost $894 billion, and extend health coverage to 96 percent of Americans. Among other provisions, the bill includes a n individual health in surance mandate, an employer insurance mandate, and a public plan option with government - negotiated reimbursement rates. However, the much - discussed public plan option would be available only through a national insurance exchange; the Congressional Budget Office (CBO) estimates that only 10 percent of Americans would be eligible to enroll in the plan and only 6 million people are likely to do so ( New York Times, 10/2 9 ; San Francisco Chronicle, 10/29 ). The merged House222s bill would also expand Medicaid to all eligible residents earning up to 150 percent of the federal poverty level (FPL), provide subsidies for low - and moderate - income Americans to purchase private coverage through the exchange, end the federal anti- trust exemption for health insurance companies, and prohibit insurers from denying coverage based on pre - existing c onditions ( Kaiser Health News, 10/29 ; Kaiser Health News, 10/29 ; Wall Street Journal, 10/29 ). The bill is largely financed by a non - inflation - indexed surtax on individuals with adjusted gross income (AGI) over $500,000 and families with AGIs over $1 million ( CQ Politics, 10/29 ; CQ Politics, 10/29 ) in addition to over $400 billion in cuts to government health care programs ( Washington Post, 10/30 ). House Democrats lowered the cost of the bill by approximately $200 billion by removing the Medicare 223doctor fix224 that would have altered the Medicare payment formula for physicians, instead choosing to introduce it as separate legislation. ( Kaiser Health News, 10/29 ). Meanwhile, on October 26, Senate Majority Leader Harry Reid (D - NV) announced that Senate Democrats222 health reform bill, which combines the Senate Health, Education, Labor and Pensions (HELP) Committee222 s bill and the Senate Finance Committee222s bill, will include a public option. The Senate222s option requires the government to negotiate reimbursements rates directly with health care providers; however, unlike the House222s option, the Senate222s option includ es an 223opt out224 for states that are able to provide equal competition and quality through private insurers ( Kaiser Health News, 10/27 ; Kaiser Health News, 10/28 ). Senator Olympia Snowe (R - ME), and some Democrats and Independents, including Senators Joe Lieberman (I - CT) and Blanche Lincoln (D - AK), said that they will oppose the health reform bill on the Senate floor because of the public option ( Kaiser Health News, 10/27 ). President Obama Signs Military Spending Bill Requiring Mental Health Screenings for Returning Vets ; Congressmen Propose Bill to Give Military Personnel Direct Access to Mental Health Treatment : On October 28, President Barack Obama signed H.R. 2647 authorizing FY2010 appropriations for the Depa rtment of Defense (DOD). Among the provisions of the new law, the DOD must provide in - person mental health screenings for soldiers returning from the wars in Iraq and Afghanistan. In related news, Rep. Michael McMahon (D - NY) introduced legislation ( H.R. 1308) to give TRICARE beneficiaries direct access to mental health counseling without a referral from a primary care physician ( Army Times, 10/23 ). Sen ate Confir ms Benjamin as Surgeon General: On October 29, the U.S. Senate confirmed Dr. Regina Benjamin as U.S. Surgeon General . President Obama nominated Benjamin July 14 and the Senate HELP Committee confirmed her on October 7. Benjamin founded and subsequently rebuilt the Bayou La Batre Rural Health Clinic after its destruction by hurricanes Georges and Katrina. Benjamin SAMHSA222s Weekly Financing News Pulse: National Edition October 30, 2009 10/30/09 3 also served as president of the Alabama Medical Association and as associate dean for rural health at the University of Alabama College of Medi cine ( CQ Today, 10/29 ; AP, 10/29 ). Re p. Sestak Introduces Legislation to Extend the ARRA COBRA Subsidy: On October 26, Rep. Joe Sestak (D - PA) introduced legislation ( H.R. 3930 ) to extend the COBRA coverage period by six months for individuals who lost their jobs between April 1, 2009 and December 31, 2009. The legislation would also amend the American Recovery and Reinvestment Act (ARRA) to extend the maximum period of eligibility for the ARRA COBRA subsidy from nine to 15 months, and provide an additional six months of unsubsidized COBRA coverage to individuals laid off in early 2008. The bill was referred to the House Ways and Means Committee , the House Education and Labor C ommittee , and the House Energy and Commerce Committee ( Kaiser Health News, 10/28 ; THOMAS ). S en. Kaufman Introduces Bill t o Increase Funding for Health Care Fraud Investigation, Increase Penalties: On October 28, Senator Edward 223Ted224 Kaufman (D - DE) introduced legislation ( SB 1959) to increase funding for health care fraud enforcement by $20 million annually through 2016 and i ncrease jail time for those convicted of health care fraud. The bill was referred to the Senate Judiciary Committee ( Wall Street Journal, 10/28 ; THOMAS ). Ne w York Attorney General Announces New Database to Calculate Out - of -Network Health Claims: New York Attorney General Andrew Cuomo announced a new database designed to calculate 223reasonable and customary224 out - of - network health care costs, replacing UnitedHealth Group Inc . 222s Ingenix database. In January, UnitedHealth Group reached a settlement in which the company agreed to pay $350 million in reimbursements resulting from Ingenix overcharges and fund this new independent database. The new database will be operated by non - profit FAIR Health and with support from Syracuse University and other New York universities. The new database, which will also be accessible to consumers via a new website, is slated to begin operation within a year ( Kaiser Health News, 10/28 ; New York Times, 10/27 ). F our Pharmaceutical Companies Agree to Pay $124 Million to Settle Medicaid Fraud Claims: The U.S. Department of Justice (DOJ) reached an agreement with four pharmaceutical companies under which the companies will pay a total of $124 million to settle allegations that they submitted false claims to state Medicaid programs. Mylan Inc. and UDL Laboratories will pay $118 million, As traZeneca PLC will pay $2.6 million, and Ortho - McNeil Pharmaceuticals will pay $3.4 million. Because the settlement involves Medicaid fraud, affected states will receive shares of the settlement ( Reuters, 10/19 ). S AMHSA Awards $170.5 Million to Fund Systems of Care for Mentally Ill Children and Their Families: The Substance Abuse and Mental Health Services Administration (SAMHSA) announced t he award of 20 grants totaling $170.5 million over 6 years to develop and expand systems of care for children and youth with serious emotional disturbances and their families. The programs selected for these cooperative agreements will receive up to $1 million in year one, up to $ 1.5 million in year two, and up to $ 4.5 million over years three through six. SAMHSA222s Center for Mental Health Services (CMHS) will administer the grants which were awarded in AL, CA, FL, HI, ID, IL, MD, MA, MI, MS, NM, NY, OH, PA, TN, and Guam ( SAMHSA, 10/1 ; Post - Standard, 10/23 ). Ga llup Poll Finds 44 Percent Favor Legalizing Marijuana: Gallup222s October Crime Poll found that 44 percent of Americans favor legalizing marijuana while 54 percent oppose it. The poll shows that SAMHSA222s Weekly Financing News Pulse: National Edition October 30, 2009 10/30/09 4 public support for legalization was roughly 25 percent in the mid - 1990s but rose to 31 percent in 2000 and has continued to increase since ( Gallup, 10/19 ; Joint Together, 10/22 ). GM Salaried Workers Offered Only High - Deductible Health Plans : Effective January 1, 2010, General Motors Co. (GM) will offer only high- deductible consumer - driven health care plans to the company222s 24,000 salaried employees. GM will couple the plans with health savings accounts (HSAs) to which GM will contribute $1,300 annually. GM salaried employees hired after 1993 are not eligible for the company222s retiree health coverage ( Kaiser Health News, 10/23 ). Studies Released Thomson Reuters Estimates U.S. Health Care System Wastes at Least $505 Billion Annually : A report released by Thomson Reuters on October 26 estimates that the U.S. health care system wastes between $505 and $805 billion annually. According to the report, 40 percent of health care waste is attributed to unnecessary care, 19 percent to fraud, 17 percent to administrative inefficie ncy, 12 percent to provider errors, 6 percent to preventable conditions and 6 percent to lack of care coordination ( Thomson Reuters, 10/26 ; Kaiser Health News, 10/26 ). C HCS Report Analyzes High -Cost, High -Need Medicaid Beneficiaries: A Center for Health Care Strategies Inc. (CHSC) report , funded by Kaiser Permanente, used pharmacy claims to supplement a 2007 report in order to better analyze Medicaid222s high - cost and high - need populations. The additi on of pharmacy data revealed that the proportion of disabled beneficiaries diagnosed with three or more chronic conditions is 45 percent rather than 35 percent, as was previously estimated, and that the frequency of psychiatric illness among disabled benef iciaries is 49 percent rather than 29 percent. The new analysis also found that the costs for beneficiaries with three or more chronic conditions account for 75 percent of total spending on disabled beneficiaries, up from the previous estimate of 66 perce nt ( CHCS, 10/2009 ). E PI Documents Decline in Employer -Sponsored Health Insurance, Projects Further Decline: The Economic Policy Institute (EPI) released a report outlining a 6.4 percent decline in employer - sponsored health insurance from 2000 to 2008 and predicting a further decline through 2010 due to rising unemployment. In addition, the rep ort contains state - level data on employer- sponsored health coverage trends ( Dotmed News, 10/27 ). Urban Institute Examines Age Rating Under Health Care Reform Bills: A brief released by the Urban Institute examines the effects of age rating rules under different versions of congressional health care reform. The brief uses Health Insurance Policy Simulation Model (HIPSM) to compare the financial implications of the differing age rating ratios (5:1, 2:1, and 1:1) which would control the price disparity between older and younger adults222 premiums ( Kaiser Health News, 10/23 ; Urban Institute, 10/1 ). C BPP Report Finds Finance Committee Bill222s Premium Subsidies Insufficient: The Center on Budget Policies and Priorities (CBPP) released a report stating that the structure of the health insurance premium subsidies provided under the Senate Finance Committee222s version of health care reform would be insufficient for many Americans. The report notes that, though the subsidies would limit premium expenses for low - income residents based on their income during the first year of implementation, future premium caps would be based on a percentage of the first - year premiums rather than o n income. The CBPP report notes that, because health care premiums have risen SAMHSA222s Weekly Financing News Pulse: National Edition October 30, 2009 10/30/09 5 significantly faster than incomes, premiums for those receiving the subsidy could easily exceed the original caps ( Kaiser Health News, 10/29 ; Kaiser Health News, 10/29 ). C ommonwealth Fund Report Examines Cost of 223Medical Home224 Model: A report by the Commonwealth Fund examined the relationship between medical practices222 costs and medical home activities, finding that medical homes were associated with modest information technology cost increases, but no other additional costs. However, the authors acknowledge that the absence of a clear association between the level of medical home implementation and practice cost may stem from data limitations or an insufficient definition of 223medical home224 ( Commonwe alth Fund, 10/16 ; Kaiser Health News, 10/23 ). S K&A Report Finds 83 Percent of Physicians Accept Medicare, 65 Percent Accept Medicaid: According to SK& A Healthcare Information Solutions 222 (SK&A) Physician Office Acceptance of Government Insurance Programs Report, 83 percent of physicians222 offices accept Medicare and 65 percent accept Medicaid. In addition, the report found that Medicare and Medicaid acce ptance varied by size, ownership, location, and specialty of physicians222 practices. Larger practices are more likely to accept Medicare patients than smaller practices, while hospital- owned practices are more likely to accept Medicaid than non- hospital - ow ned practices ( PR.com, 10/29 ). Around the Hill: Hearings on Health Financing House Homeland Security Subcommittee on Energy Threats, Cybersecurity, and Science and Technology : Federal Response to the H1N1 Influenza Pandemic October 27, 2:00 p.m. 311 Cannon Senate Judiciary Committee: Health Care Fraud October 28, 10:00 a.m. 226 Dirksen Senate HELP Committee : Increasing Small Business Health Care Costs November 3, 2:30 p.m., 430 Dirksen House Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies : H1N1 Influenza Pandemic November 4, 10:00 a.m., 2359 Rayburn Senate Veterans Affairs Committee : VA - Indian Health Service Cooperation Nov ember 5, 10:00 a.m., 418 Russell Senate Judiciary Committee: Reducing Recidivism at the Local Level November 5, 2:00 p.m., 226 Dirksen
