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U.S. Announces New Effort To Combat Compromised Computers

Yesterday, we attended a White House event to announce a new effort known as the Industry Botnet Group (IBG) to combat botnets.

A botnet is a collection of compromised computers connected to the Internet.

The IBG is the result of a voluntary public-private partnership between the White House, the Departments of Commerce and Homeland Security and trade associations representing the  internet ecosystem of technology companies and internet service providers led by TechAmerica, National Cyber Security Alliance (NCSA) and the National Cable and Telecommunications Association (NCTA), among others.

“Cybersecurity is a shared responsibility – the responsibility of government, our private sector partners, and every computer user,” said Secretary of Homeland Security Janet Napolitano. “DHS has set out on a path to build a cyber system that supports secure and resilient infrastructure, encourages innovation, and protects openness, privacy and civil liberties.”

“Botnets continue to increase the price of doing business online and place our companies at a competitive disadvantage, while threatening our individual privacy,” said Under Secretary of Commerce for Standards and Technology Patrick Gallagher. “Today’s efforts are only the beginning of the actions we can take, but working together through this public-private partnership we can start to combat these challenges.”

The IBG’s initiatives to combat botnets and can be found at http://industrybotnetgroup.org.

In addition, several IBG members have launched the Keep a Clean Machine campaign as part of the STOP.THINK.CONNECT education campaign for consumers supported by DHS, the Federal Trade Commission (FTC), NCSA and several companies.

Many of the IBG trade associations are prepared to sign up to the voluntary botnet principles as are many ISPs. This effort will be a success if trade associations and their respective member companies can cooperate in a constructive manner to share information about combating and remediating botnet threats.

U.S. Announces New Effort To Combat Compromised Computers

Weekly Health Policy Update: CCIIO Exchange Meeting, HHS Funding for Family-to-Family Centers, and More Exchange Developments at the Federal Level

Weekly Health Care Wrap-Up.

CCIIO Holds 3-Day Exchange Meeting, Releases FAQs 

Exchange watchers this week focused on stories emerging from the three-day implementation forum hosted by the Center for Consumer Information and Insurance Oversight (CCIIO) in Washington, DC. With plenty to discuss after a myriad of exchange announcements last week, including guidance on the federally facilitated exchange (FFE), state partnership models and tax credits, states and stakeholders gathered to sort through a host of issues. CCIIO has a series of implementation forums scheduled throughout the summer. The complete schedule can be found here.

Additional information about the CCIIO implementation forum can be found in this week’s State of the States: Health Insurance Exchanges. Also this week, CCIIO moved forward by adding a FAQ section to its website focused on the blueprint process. The new FAQs are available here.

PDUFA Clears Senate…

Prescription drug user fee legislation cleared the Senate easily on Thursday evening by a 96-1 vote. Senator Bernie Sanders (I-VT) was the lone senator to oppose the legislation. The full House is expected to turn to its version of the bill on Wednesday. Congressional leaders indicate they hope to wrap up consideration of the issue by the beginning of July.

While Prevention and Public Health Offset Fails

The Senate also on Thursday voted down legislation that would offset upcoming increases in student loan interest rates with funds from the Prevention and Public Health Fund. Ten Republicans joined Democrats in opposing the legislation. A nearly identical plan was approved by the House in April.

HHS Announces Funding for Family-to-Family Information Centers

The Department of Health and Human Services (HHS) this week announced $4.9 million in funding for Family-to-Family information centers. Created in 2005, the centers are state-wide, family-led organizations that provide information, education, training, outreach and peer support to families of children with special health care needs. The centers are staffed by trained family leaders who have children with special health care needs, and expertise in navigating federal, state and local public and private health care systems. The Health Resources and Services Administration (HRSA) oversees the centers. More information can be found here.

PCORI Releases Funding Opportunities

The Patient Centered Outcomes Research Institute (PCORI) announced the availability of $96 million in grant funding for research in four out of its five research agenda areas. Specifically, the funding opportunities are focused in the following areas:

  • Assessment of Prevention, Diagnosis, and Treatment Options
  • Improving Healthcare Systems
  • Communication and Dissemination
  • Addressing Disparities

Additional information on the funding opportunities can be found here.

More Co-Op Loans Announced

Late last week, more than $135 million in co-op loans were announced, funding co-ops in Nevada and Michigan. The Hospitality Health Co-op, located in Nevada, received $65.6 million, with Michigan Consumer’s Healthcare Co-op receiving $71.5 million. More information can be found here.

From the States

California. The Bay Area Council’s Economic Institute is out with a new report estimating that the ACA will generate nearly 100,000 jobs in the state when it is fully implemented. The report also finds that full implementation of the ACA would add $4.4 billion to the state’s economic activity. The report can be found here.

Missouri.  Late last week, the Missouri House passed House Bill 464, which prevents Governor Jay Nixon (D) from using an Executive Order to create an exchange and puts the question of whether Missouri should establish an exchange on the November ballot. Similar legislation had already been passed by the Missouri Senate earlier this year. To give the law added teeth, any Missouri general assembly member or Missouri taxpayer may file suit against the state if it cooperates with the federal government to set up an exchange.

Texas. The state’s Medicaid director since 2010, Billy Millwee, announced this week that he will retire in August. Millwee has spent 18 years with Texas’ Medicaid program, one of the largest in the country.

Health Insurance Exchanges: State of the States update.

Similar to last week, exchange watchers witnessed a number of developments at the federal level this week. Let’s review before diving into what’s happening in the states.

Late last Friday, the Internal Revenue Service issued a final rule on the ACA’s insurance premium tax credits. An important change was the elimination of the so-called “marriage penalty” that impacted couples who qualified individually for insurance premium tax credits, but did not qualify as a couple. Under the old rule, newlyweds that saw their income increase as a result of being married would have to repay the federal government for any subsidy overpayments. Under the new rule, couples will now make separate income calculations on their pre- and post-marriage income, which should help them avoid penalties.

Also, the IRS continues to weigh how it will determine if employer-sponsored insurance is “affordable.” As it currently stands, “affordable” employer insurance is calculated against the employee’s share of the premium for the lowest-cost, self-only coverage option proposed by the employer. Many argue this calculation should be based on family, not individual, coverage. The regulation indicates this issue will be addressed in future regulations concerning employer-sponsored insurance.

Meanwhile, at this week’s three-day exchange implementation meeting sponsored by the Center for Consumer Information and Insurance Oversight (CCIIO), participants received additional details on federally-facilitated exchanges and the state-federal partnership model. At the meeting, CCIIO encouraged states, even those pursuing a state-based exchange, to consider applying for the federal-state partnership model as a backup, in case states had unexpected problems setting up their exchanges.

After the meeting, CCIIO added a FAQ section to its website to answer previously asked questions about the blueprint process. The FAQ describes how to submit a Blueprint Application, the information required in a Blueprint Application, and lays out what reference documentation HHS will seek from states. States that receive conditional approval of their exchange from HHS will be subject to monitoring reviews by HHS to make sure the exchange is operational by the 2014 deadline. To further help address any exchange-related questions by either the states or other stakeholders, CCIIO is gearing up for a series of regional implementation forums, with the first one kicking off in Washington, DC on July 18. After DC, the forum heads to Chicago, Denver and Atlanta.

Also, we learned this week that Virginia is taking some additional steps to plan for an exchange. The chairman of the Senate Commerce and Labor Committee, Sen. John Watkins (R), announced that he is going to re-establish a subcommittee to review potential exchange-enabling legislation. Currently, the state has the legal authority to plan for an exchange, but not the authority to create one without either legislation or an Executive Order from Governor Bob McDonnell (R). Additionally, Virginia expects to release an RFP shortly to procure a Medicaid eligibility system. The RFP is expected to include an option that will allow Virginia to procure the IT backbone for the state’s Individual and SHOP exchanges. There are also reports that Virginia is preparing a Level One grant to submit to HHS this summer.

Virginia is not the only state busy preparing grant applications for HHS. California is preparing to apply for another Level One grant in the next few months. Also, expect to see Connecticut apply for Level Two funding sometime later this year, along with Arizona, which is targeting its Level Two application for the November 1 deadline.

Finally, earlier this month, the California Health Benefit Exchange announced a preliminary decision to award First Data Corp a $9.3 million contract to manage the development of the exchange’s enrollment system. The California Health Benefit Exchange is still mulling which vendor it will choose to actually develop and implement its IT exchange backbone.

Weekly Health Policy Update: CCIIO Exchange Meeting, HHS Funding for Family-to-Family Centers, and More Exchange Developments at the Federal Level

Weekly Health Policy Update: New CMS Rule Released, More School-Based Funding and Slowing Exchange Legislation

Weekly Health Care Wrap-Up.

CMS Releases Medicaid Payment Rule

The Centers for Medicare and Medicaid Services (CMS) this week released a proposed rule to implement Medicaid payment increases for primary care providers included as part of the Affordable Care Act (ACA).  Under the rule, primary care physicians including those who practice family medicine, pediatric medicine or general internal medicine, will be allowed to charge Medicare rates in 2013 and 2014. Providers administering vaccinations under the Vaccines for Children program will also be eligible for higher rates. The cost of the rate increase is funded by the federal government as part of the ACA.

Lugar Loses Primary Battle

In another blow to Senate moderates, long-time Indiana Republican Senator Dick Lugar fell to primary challenger Richard Mourdock this week. While Lugar did not hold positions on committees with jurisdiction over health issues, he is known for his willingness to work with Senators on the other side of the aisle. Senator Lugar is the latest in a long line of Senate moderates who have recently been defeated or decided to retire.

User Fee Bill Cleared by House Committee

On Thursday, the House Committee on Energy and Commerce approved drug user fee legislation, sending it to the House floor for a vote. The vote was unanimous and no amendments were offered. Similar legislation was recently approved on a bipartisan basis by the Senate Committee on Health Education Labor and Pensions. The Energy and Commerce Committee press release can be found here and the legislation summary can be found here.

CMS Announces Innovation Awards

CMS announced on Tuesday its first awards under the Innovation Challenge program, a $1 billion opportunity for health care stakeholders to test new delivery and payment models. The long-awaited announcement funded 26 recipients for a total of $122.6 million. According to CMS, the projects are expected to save $254 million over three years.

HHS Announces School-Based Health Center Funding

The Department of Health and Human Services (HHS) this week announced $75 million in available funding as part of the School-Based Health Center Capital (SBHCC) Program created by the ACA. The funding opportunity is the third in a series of awards that will be made available to school-based health centers using the $200 million included in the ACA for the initiative. The Health Resources and Services Administration (HRSA) oversees the program. Information for the SBHCC Program grant opportunities can be found here.

HHS Finalizes MLR Notice Requirements

HHS has issued a final rule on how insurers must notify customers that they failed to meet the ACA’s medical loss ratio requirements.

From the States

Massachusetts. Senate lawmakers on Wednesday released legislation to rein in health care costs in the state. In addition to cost growth targets and processes to aid in provider adherence to the benchmarks, the legislation also includes a Prevention and Wellness Trust Fund to support community-based prevention and wellness programs; a requirement that by July 1, 2014 state-funded health programs implement “alternative payment methodologies;” and a mandatory 180-day “cooling off” period after an injured patient signals intent to file litigation.

New Jersey. New Jersey Governor Chris Christie (R) has vetoed legislation (A2171/S1319) that would have created a health exchange. In a prepared statement, Governor Christie said that he vetoed the bill because it “is not known whether the Affordable Care Act will remain, in whole or in part, it would be imprudent for New Jersey to create an exchange at this moment.” Before being vetoed by Governor Christie, exchange legislation cleared the Senate by a wide margin, 22-13, and passed the Assembly by a slightly narrower margin. New Jersey’s exchange legislation had been opposed by the state’s health insurers because the Exchange would have operated as an “active purchaser” and limited the types of plans that could be sold. The bill also specifically banned current health care executives from serving on the Exchange’s governing board.

Around Town

Institute of Medicine (IOM) is out with a new report focusing on how changes to physical activity, food and beverages, messaging in the media, health care and work, and school, could help curb the obesity problem in the U.S.  The report is available here.

Urban Institute researchers are out with two new reports evaluating health care access issues in the U.S. The first report, released by RWJF, finds that access indicators worsened between 2000 and 2010.  The second study, published inHealth Affairs, found that children’s access to health care has increased over the past decade.  Check out the RWJF brief here; the Health Affairs article can be found here (subscription required).

The Office of the National Coordinator (ONC) has released a new interactive “Health IT Dashboard” capturing health IT data and grant programs.  The dashboard can be found here.

Health Insurance Exchanges: State of the States update.

After various states took steps last week to move forward with exchange legislation, this week some states that were moving ahead with exchange legislation have now slowed their pace.

Yesterday, just after the clock struck twelve, Governor Chris Christie (NJ – R) vetoed legislation (A2171 /S1319) that would have created a health exchange. His veto was not unexpected. Governor Christie was clear he wanted to wait for the Supreme Court to rule on the ACA before proceeding with an exchange. However, bill supporters had been holding out hope that last minute pressure would spare A2171/S1319 from a veto. New Jersey’s health exchange legislation now returns to the legislature, where it will be reevaluated and possibly modified.

New Jersey was not the only state to halt plans for creating a health exchange this week. In Illinois, lawmakers announced that they were tabling a bill (HB 4574) to create an exchange until after the Supreme Court’s decision. In both the House and the Senate, legislative leaders were concerned about calling for a vote when they did not believe they had bipartisan support. Republican leaders in the House and Senate had been adamant that there was little GOP support for passing the bill before the Supreme Court rules. This delay increases the likelihood that Governor Pat Quinn (D) will use an executive order to create an exchange. An outspoken supporter of health exchanges, Governor Quinn has been considering issuing an executive order ever since there were signs in February that exchange legislation may not pass.

Then in Alabama, exchange legislation that had passed the House is now running out of steam in the Senate in the face of a looming veto threat from Governor Robert Bentley (R) and over concerns that the proposed legislation would primarily benefit Blue Cross Blue Shield of Alabama. Language added to the bill requires that insurers on the exchange offer coverage in all counties of the state, a provision that critics argue would make Blue Cross Blue Shield of Alabama the main carrier on the exchange. According to Mike O’Malley, executive director of the Alabama Association of Health Plans, only Blue Cross Blue Shield of Alabama meets that criterion. A study by the Kaiser Family Foundation found that 86 percent of the individual and 96 percent of the small group market in Alabama was served by Blue Cross Blue Shield of Alabama.

In Connecticut, a bill that would have increased the number of board members of the Connecticut Health Insurance Exchange by five, failed to be called for a vote on the Senate floor after passing in the House. The bill would have added four additional consumer and small business representatives to the Exchange’s board of directors, as well as giving voting rights to State Health Care Advocate Victoria Veltri.

On Wednesday, the Office of the Alabama Health Insurance Exchange released a long-anticipated RFP for the exchange’s IT system. In its wide-ranging solicitation, Alabama envisions its exchange IT solution serving both the individual market and SHOP.  Alabama also included web portal development in its RFP and expects the vendor to develop tailored web portals for individuals, small businesses, navigators and insurance providers. Responses are due by June 11 with the Department expecting to award the contract a month later on July 11.

Wyoming also released an RFP for a Health Insurance Eligibility and Enrollment System for Medicaid and the Children’s Health Insurance Program. While this procurement is not for a health insurance exchange, what makes it noteworthy is the RFP acknowledges that the new eligibility system will have to integrate with an insurance exchange. Wyoming has made little progress preparing for an exchange. Compared to other states, Wyoming has only received an $800,000 federal Exchange Planning grant and with the legislature already adjourned for 2012, it makes it very unlikely that the state will make strong progress before the federal deadline.

Weekly Health Policy Update: New CMS Rule Released, More School-Based Funding and Slowing Exchange Legislation

A “Chunks” Approach to Climate Policy

At a Politico Pro Energy breakfast this morning in Washington, DC, White House Deputy Assistant for Energy and Climate Change Heather Zichal defended the Administration’s energy record but also provided a window into what a second term energy policy might look like for President Obama.

These comments come after Zichal last week described the failure to pass cap-and-trade legislation in 2010 as “one of (President Obama’s) greatest frustrations.”

At the breakfast, the moderator asked Zichal about her comments on cap-and-trade and what they could mean for a climate policy in a second term for President Obama.

While ideally President Obama would seek a “comprehensive” approach to climate change, Zichal acknowledged that the Administration would likely approach this issue in “chunks.” Specifically, Zichal talked about seeking “tools and policies that can garner bipartisan support.” One example provided by Zichal was extending the production tax credit for renewable production, which is set to expire at the end of this year. The “chunks” mention appears to reinforce the notion that President Obama would be unlikely to pursue cap-and-trade, or some variant, in a second-term.

Following Zichal’s comments, Senator Lamar Alexander (R-TN) spoke – his remarks suggested that there are other “chunks” where consensus is achievable on energy policy between the Administration and Congress. Specifically, Senator Alexander expressed support for the Advanced Research Projects Agency-Energy (ARPA-E), an agency focused on R&D for breakthrough energy technologies, such as small modular reactors, smart grids, carbon capture and electric car batteries. ARPA-E is modeled after the Defense Advanced Research Projects Agency (DARPA), which, among other achievements, helped in inventing the internet. The American Recovery and Reinvestment Act provided the first appropriations for ARPR-E, which has subsequently used that money to fund over 180 projects focused on emerging energy technologies.

In an election year, Republicans and Democrats spend an inordinate amount of time highlighting their differences on energy policy. Yet on ARPA-E, both President Obama and Governor Mitt Romney have expressed support for a continued commitment to the program. Senator Alexander’s comments indicate that an important and achievable “chunk” of climate policy, regardless of the outcome of the election, could be a renewed emphasis on ARPA-E.

A “Chunks” Approach to Climate Policy

Cyber Legislation Outlook: What Companies Should Monitor as Congress Considers Cybersecurity Legislation

From our Cyber legislation update this week.

The House of Representatives concluded “cyber week” at the end of April with the passage of a number of bills targeted at enhancing the nation’s protections against cyber threats. The Senate is expected to consider proposed legislation in the coming weeks which has both a number of similarities, as well as some essential differences from the bills that passed the House. As evidenced by the scope of the bills themselves, the passage of comprehensive cybersecurity legislation may have a sweeping impact on businesses across industry sectors. As such, this Advisory provides a snapshot of the key similarities and differences between and among the competing legislation so that clients may anticipate and assess the potential legal and regulatory impacts of the proposed legislation.


Cyber Legislation Outlook: What Companies Should Monitor as Congress Considers Cybersecurity Legislation

Weekly Health Policy Update: Community Health Center Funding, Prevention Fund Pushback and Exchange Legislation

Weekly Health Care Wrap-Up.

More Community Health Center Funding Announced

The Department of Health and Human Services (HHS) this week announced more than $728 million in funding for 398 renovation and construction projects focused on expanding community health center capacity. In total, the Affordable Care Act (ACA) provided $9.5 billion to expand community health center services over five years and $1.5 billion to bolster major construction and renovation projects. According to a report released by HHS, employment at community health centers has increased 15 percent since 2009.  A list of awardees can be found here.

Future of Prevention Fund Still Uncertain

Late last week, the House of Representatives approved legislation that would use funding from the Prevention and Public Health Fund to offset scheduled increases in student loan interest rates. The bill is receiving significant pushback from Senate Democrats, including Senate Majority Leader Harry Reid (D-NV) and Health, Education, Labor and Pensions Chair Tom Harkin (D-IA).  Meanwhile, Democrats propose to pay for the cost of the student loan fix by closing certain tax loopholes. Lawmakers proceeded to a one week recess following the vote, so further action has not yet occurred.

From the States

Alabama. Through a spokesman, Governor Robert Bentley (R-AL) threatened to veto exchange-enabling legislation (HB245) that was recently approved by Alabama’s House. In his statement, Deputy Communications Director Jeremy King said that moving forward with health exchange legislation was premature, not only because the federal government has not yet released complete guidelines for operating an exchange, but also because the Supreme Court has not ruled on the Affordable Care Act.  He also hinted that the federal government might push back deadlines for operating an exchange.

Oregon. Earlier this week after a visit to Washington, DC by Governor John Kitzhaber (D), the Centers for Medicare and Medicaid Services (CMS) announced Oregon will launch Coordinated Care Networks throughout the state’s Medicaid program.  The initiative is part of a $1.9 billion demonstration program that the state says will save $11 billion in Medicaid costs over 10 years.

Louisiana. Last week, the Louisiana Senate Insurance Committee voted by a margin of 6-2 to advance health exchange legislation, SB744, to the Senate floor. Introduced by state Senator Sharon Weston Broome (D), the bill found an ally in Insurance Committee Chairman Dan Morrish (R).  Chairman Morrish voted in favor of SB744 because he believed that it is a good idea for Louisiana to “be ready and proactive” should the state need to create an exchange. Governor Bobby Jindal (R) has opposed exchanges under the ACA.

Around Town

America’s Health Insurance Plans (AHIP) this week released two new reports profiling the enrollment of minorities and low-income seniors in Medicare Advantage and Medigap plans.  The Medicare Advantage report is availablehere; the Medigap report can be found here.

The Commonwealth Fund is out with a new report which captures U.S. health care spending per person and evaluates drivers of high health care costs.  The report is available here.

At an event today (Friday) at the Brookings Institute, Alice Rivlin (former OMB Director under President Clinton) will release a paper examining potential Medicare premium support compromises.  More information on the event can be found here.

Health Insurance Exchanges: State of the States update.

This was an interesting week for exchange watchers, with a growing chorus of states considering the merits of moving exchange legislation forward to avoid the federal government establishing an exchange on their behalf. Lets run through the latest developments.

On Wednesday, in response to the Alabama state House passing exchange-enabling legislation (HB245) last week, Governor Robert Bentley (R) threatened to veto any exchange bill that reaches his desk before the Supreme Court rules on the ACA. Meanwhile the bill’s sponsor, Representative Greg Wren (R), maintains his primary reason for progressing with HB245 is to avoid having the federal government set up an exchange in the state.

That same logic drove the Louisiana Senate Insurance Committee to vote exchange-enabling legislation (SB744) out of committee and to the Senate floor this week. While the bill was introduced by a Democrat, Insurance Committee Chairman Dan Morrish (R) helped push the bill forward because he wants Louisiana to “be ready and proactive” should the state need to create an exchange. While Governor Bobby Jindal (R) has not commented specifically on SB744, he opposes health insurance exchanges created as part of the ACA and halted all exchange planning activities by the state last year.

In Kentucky, Governor Steve Beshear (R) announced on Thursday that if the Supreme Court upholds the ACA, he will establish a health insurance exchange by executive order to avoid having the federal government create an exchange in the state. In his announcement, Governor Beshear said Kentucky was better positioned than the federal government to determine the health care needs of its citizens. Planning for the state’s exchange will continue in the meantime using funding from a $57.8 million grant from the U.S. Department of Health and Human Services that Kentucky received in February.

And in Vermont, a conference committee resolving differences between the House and Senate versions of HB559 reached an agreement on Wednesday. Overall, only minor changes needed to be resolved with most of the focus revolving around increasing legislative oversight of the exchange’s benchmarks as the exchange transitions toward a single-payer health care system over time. The final bill still needs to be approved by both the House and Senate before heading to Governor Peter Shumlin (D).

Turning to RFPs and RFIs, Nebraska’s Department of Insurance just closed an RFI for its exchange IT backbone on Thursday. While the state has not disclosed if and when it will issue a RFP for building the Exchange’s IT system, it did recently hire Navigant Consulting on April 12 to provide technical writing services for Exchange RFIs/RFPs.

Finally, looking at private exchanges, Benefitfocus last week launched a private exchange offering an interesting set of products. The service offers traditional health, vision and dental insurance plans as well as wellness programs. However, the exchange can also be used to buy auto insurance, identity protection insurance and even gym memberships.

Weekly Health Policy Update: Community Health Center Funding, Prevention Fund Pushback and Exchange Legislation

Weekly Health Policy Update: Cuts to ACA, Student Loan Bill Effects, and More Exchange Issues

Weekly Health Care Wrap-Up.

House Committee on Energy and Commerce Approves Cuts to ACA…

Earlier this week, the House Committee on Energy and Commerce approved almost $115 billion in cuts to health care programs to meet the Committee’s deficit reduction requirements set forth by the Ryan Budget. Specifically, the package takes $14.5 billion from state-based exchange funds, $11.9 billion from the Prevention and Public Health Fund and $872 million from Consumer Oriented and Operated Plans (CO-OPs). In addition, the bill repeals the Medicaid maintenance of effort (MOE) requirements set forth in the Affordable Care Act (ACA), cuts hospital DSH payments by $4.2 billion and limits the Medicaid provider tax threshold, among other provisions. Neither this legislation nor the budget offered by House Budget Chair Paul Ryan (R-WI) is expected gain meaningful traction on the Senate at this time.

…Prevention and Public Health Fund at Risk in Student Loan Bill

Meanwhile, the House is expected to vote today (Friday) on legislation that would use funds included as part of the ACA’s Prevention and Public Health Fund to stave off scheduled interest rate increases on student loans. The decision by House Republicans sets up a standoff with Senate Democrats, particularly Committee on Health Education Labor and Pensions (HELP) Chair Tom Harkin (D-IA), who told Politico this week that he has an “ironclad agreement…that the prevention fund cannot be invaded anymore.” Earlier this year, Congress used $5 billion from the fund to offset an extension of the payroll tax cuts. Thus far, the fund has been used to finance a host of public health initiatives, including Community Transformation Grants, various public health workforce programs and increased resources for chronic disease prevention in states.

FDA User Fee Bill Stalls in House

The Senate HELP Committee on Wednesday approved legislation to reauthorize the FDA user fee program with bipartisan support.  Only one amendment offered by Senator Orrin Hatch (R-UT) was approved.  Senator Bernie Sanders (I-VT) was the only Committee member to opposed the bill.  Meanwhile, the House Committee on Energy and Commerce announced it would delay its user fee markup, which was previously scheduled for this past Thursday, until May 8.  Some reports indicate that language changing the FDA mission statement to ask regulators to consider economic factors in their decision-making may be contributing to the setback. The current user fee authorization expires on September 30.

Around Town

A new report from the Kaiser Family Foundation finds that consumers and businesses are expected to receive an estimated $1.3 billion this August in rebates as a result of new medical loss ratio (MLR) rules included in the ACA. Also this week from Kaiser, a new poll found that the Supreme Court’s consideration of the ACA did not change Americans’ opinions of the law.  The MLR report is available here and the latest poll here.

The Government Accountability Office (GAO) this week released a report recommending the Department of Health and Human Services (HHS) halt a three-year demonstration program aimed at identifying the best way forward with the Medicare Advantage “star” rating and payment system. The GAO report is available here.

The Centers for Medicare and Medicaid Services (CMS) released a revised rule focused on home and community based service options for states.  Specifically, the Community First Choice option included as part of the ACA supports a 6 percentage point increase in Federal medical assistance percentage (FMAP).

The Alliance of Community Health Plans is out with a new study about successful care transition plans that avoid preventable readmissions.  The report is foundhere.

From the States

For full coverage of this week’s exchange activities, check out this week’s State of the States – Health Insurance Exchanges here. Also, check out analyst Camden Miller’s column recapping exchange activity in the states over the past month on Governors Journal. The post can be found here.

Arkansas. Last Friday, the Arkansas Legislative Council approved a measure by voice vote to allow the Department of Insurance to move forward with utilizing a $7.67 million U.S. Health and Human Services grant awarded in February to construct a health insurance exchange.  Arkansas is pursuing a “federal-state partnership exchange,” which will utilize the federal government’s exchange IT as its backbone, while giving Arkansas the ability to determine certain parameters such as which insurers will be included on the exchange as well as use Arkansas-based Navigators to sign up participants. The ability to retain some authority over the exchange was the key argument used by State Insurance Commissioner Jay Bradford to convince legislators to approve spending the grant.

Massachusetts. Legislation aimed at moving the state away from fee-for-service payment and toward more integrated, coordinated and accountable models of care advanced from the Health Care Financing Committee this week and to the Senate Ways and Means Committee. The Health Care Financing Committee began considering the bill in February 2011. The legislation also contains provisions focused on rate review and medical malpractice reforms.

Vermont. On Tuesday afternoon, the Vermont Senate passed SB 208 by a 20-7 margin. The bill defines many important details, including the types of plans that could be offered on Vermont’s exchange and the size of companies that would be required to use it. Small differences between the House and Senate versions will be resolved in a legislative conference committee before being sent to Governor Peter Shumlin (D). Governor Shumlin is a strong proponent of the current legislation and is expected to sign the final version.

Health Insurance Exchanges: State of the States update.

The states were unexpectedly busy this week addressing exchange issues. Let’s dive in.

First, we had some notable legislation pass in the states this week. To the north, Vermont’s Senate approved legislation that defines the types of plans that could be offered on Vermont’s exchange and the size of companies that would be required to use it. The legislation is very similar to a version that was passed in the House in February, but small differences still need to be resolved in a legislative conference committee. The final version is expected to be signed by Governor Peter Shumlin (D).

Moving down south, Alabama’s House passed HB245, which enables the creation of the non-profit “Alabama Health Insurance Exchange.” The bill was approved by a strong majority and received support from both sides of the aisle. Passage by the House is a marked difference compared to last year when a similar bill, HB401, failed to make it out of the House Health committee. HB245 now heads to the Senate.

But Alabama is not the only southern state to make progress with setting up a health insurance exchange. Also this week, the Arkansas Legislative Council approved a measure to allow the Department of Insurance to spend a $7.67 million U.S. Health and Human Services grant to construct its part of a health insurance exchange. While the measure had previously failed to pass in a subcommittee, State Insurance Commissioner Jay Bradford strongly argued before the full Legislative Council that approving the grant was key to avoiding a federally-run exchange in the state. As one of the first states to pursue the “federal-state partnership” model, Arkansas could provide an interesting model for other states should the Supreme Court uphold the ACA.

In New Jersey, political pundits are wondering what Governor Chris Christie (R) intends to do with the New Jersey Health Benefit Exchange Act that is currently sitting on his desk. Passed earlier this year by the House and Senate, Governor Christie is running up against a May 10 deadline to decide whether to sign, veto or conditionally veto the bill. If he does not act by the deadline, the bill becomes law. Since Governor Christie has adamantly said that he wants to wait until the Supreme Court rules on the ACA to make a decision on exchanges, most pundits believe Governor Christie will veto the bill and send it back to the legislature for revisions while waiting for the Supreme Court’s decision.

Finally, on Wednesday, Deloitte LLP officially inked a deal with the Washington Health Benefit Exchange to construct the Exchange’s IT backbone. Initially valued at $54.85 million, the contract will likely grow in value when maintenance and license renewal fees are considered. Meanwhile, exchange watchers are still waiting to hear which IT vendor California selected for its insurance exchange. According to the California Health Benefit Exchange, the announcement has been delayed while the Exchange engages in additional negotiations with the selected vendor. However, the Exchange is optimistic that the award will be announced before the next Board meeting on May 15.

With California’s forthcoming announcement, May will be a hot time for the IT vendor community. IT procurements in Arizona, Colorado and New Mexico are expected to be announced during May, while at the end of the month, responses to build Rhode Island’s Unified Health Infrastructure Project RFP are due.

Weekly Health Policy Update: Cuts to ACA, Student Loan Bill Effects, and More Exchange Issues