Consumer Power Report #466
Now that the King v. Burwell question has been resolved, the next big question facing Republicans on Capitol Hill is whether they will take the step of proving they can actually repeal Obamacare. On this question, Ways and Means Chairman Paul Ryan is emphatic: Republicans will use the Budget reconciliation process to prove they can go after Obamacare.
A top House Republican on Friday vowed to keep fighting to repeal ObamaCare through budget reconciliation even as the tactic is losing support from some within the GOP.
“We want to use reconciliation to go after ObamaCare,” House Ways and Means Committee Chairman Paul Ryan (R-Wis.) told reporters Friday.
Republicans had planned to use reconciliation – an obscure budget tool used to avoid the Senate’s 60-vote threshold – to muscle through new healthcare legislation if ObamaCare was upheld in the King v. Burwell case last month. The Supreme Court ultimately upheld the law in a 6–3 vote, creating a new headache for Republicans who now see fewer options in their battle against ObamaCare.
“We were planning for King prevailing, and we have to retool now that King didn’t prevail, and we’re working on that retooling now,” Ryan said of the court ruling.
The court decision renewed the rift in the Republican Party between those who want to pursue repeal at all costs and those who prefer a more strategic approach to the law that will not be met with a White House veto.
The tension here is between Republicans who want to pass something the president will sign and other Republicans who want to prove to voters that Obamacare can and will be repealed should the presidency change hands. July 24 is the deadline for such a step, and House conservatives are concerned they’ve seen no movement in the Senate along those lines.
“There’s a strong commitment on the part of members to use the reconciliation process to focus on Obamacare,” Rep. Jim Jordan, R-Ohio, told The Daily Signal. “I think we’re going to do just that. We just need to do that as soon as we can.”
In February, Rep. John Fleming, R-La., led a group of Republicans who urged leadership to support using reconciliation to repeal Obamacare. Though the budget tool can only be used in the Senate, Fleming said reconciliation requires collaboration between both chambers.
Conservatives in the House are committed to using the budget maneuver to repeal Obamacare, but their Senate counterparts have floated plans to use reconciliation to repeal specific aspects of Obamacare such as the medical device tax – which is disliked by Republicans and Democrats alike – reform the tax code, or increase the spending caps imposed by sequestration.
Conservatives, meanwhile, contend that passing legislation rolling back the health care law makes good on the campaign promises they were elected to follow through on during November’s 2014 midterm elections.
While there’s some possibility of repealing a tax and/or increasing spending via a measure signed by the president, such a step seems unlikely to change the narrative about Obamacare at all – in fact, it would go to the point that Republican leadership has no stomach for actually repealing the law on the eve of an election where the law’s unpopularity could prove decisive. Whichever side prevails in the tactical argument on what to do about reconciliation could be blamed for the outcome of the presidential election, and therefore the permanence or repeal of Obamacare.
— Benjamin Domenech
IN THIS ISSUE:
With a major Food and Drug Administration reform effort having passed the House on a strong bipartisan vote, all eyes are now on the Senate, where a separate, distinct reform effort is underway – albeit slowly.
“It was in essence a 2-to-1 vote and that shows where the House is and should send a really strong signal to the Senate,” House Energy and Commerce Chairman Fred Upton (R-Mich) said of the 344–77 vote on Friday. “We’ll start working with leadership again on both sides, Leader McConnell, Reid, others.”
However strong the signal, the Senate’s Health, Energy, Labor and Pensions Committee is moving at its own pace, producing only a white paper in January and five working groups meeting on a weekly basis with stakeholders.
The Senate has not committed to a specific timeline on its initiative, which is still being drafted. A Democratic Senate aide said new legislative language could be released in early fall, and that it would address a narrower set of topics.
Sen. Lamar Alexander (R-Tenn.), HELP Committee chairman, hopes to pass the bill through committee by the end of the year. He did not respond to requests for comment, nor did Sen. Richard Burr (R-N.C.), co-author with Alexander of the white paper.
One lobbyist familiar with the Senate process said the bill would likely be narrower than what the House passed, because Senate working groups are focused specifically on heath IT and electronic health record issues, like meaningful use and interoperability.
SOURCE: Jon Reid, The Morning Consult
Transitional relief was created late in 2013 by the Obama administration for two other reasons. First, it provided a Band-Aid for the jugular-wound lie of “if you like your health care plan, you can keep it.” Second, the administration knew from insurance company filings that Obamacare-compliant insurance rates were going to be significantly higher. Thirty-four states elected to allow insurers to continue offering old policies.
Next year, grandmothered plans will be gone. They will be replaced at renewal on or before October 1, 2016. Now is the time when small businesses are budgeting for next year, and benefits professionals are working with these clients discussing strategies and sharing the impact these new benefits and rates will have on their bottom lines. With health insurance being one of the largest line items in a small-business budget, it will be hard for many of these companies to continue to offer the benefits they have today.
With huge rate increases and less benefits, small-business owners will face a tough decision. It leaves them with three options. One, they can absorb the high cost increase. Two, they can reduce benefits to bring them to their current costs, or they can reduce employee wages and try and maintain the same level of benefits. The third thing they can do is simply stop offering insurance and allow employees to purchase on their own.
SOURCE: Patrick Paule, The Federalist
In preparation for a Humana takeover, Aetna has lined up commitments for $16.2 billion in financing for the proposed cash and stock deal. But the volatility in the insurance companies’ shares suggest that investors wonder whether the deal will make it to the finish line.
Their concerns center on Humana’s earnings potential after the managed-care organization cut its forecast for full-year 2015, as well as the potential for a lengthy antitrust review that could kill the deal, analysts said.
Aetna revealed in a regulatory filing this week that Citigroup Global Markets, UBS’ Stamford, Conn., branch and UBS Securities have agreed to provide a 364-day bridge loan to help finance its Humana acquisition. The bridge loan would be used in the event that Aetna does not receive additional financing in the form of bonds and term loans.
The Hartford, Conn.-based insurer entered into the agreement July 2, the day before its public announcement of the $37 billion takeover proposal.
Humana shareholders will receive $125 in cash and 0.8375 Aetna shares for each Humana share they own. The equity value of those shares will be based on the average trading price of Aetna’s shares in the week before the deal closes.
Aetna earlier this week told investors that it expects that deal to close in the second half of next year – and the long lead time did not go unnoticed by analysts and investors. The transaction requires approvals from both companies as well as federal antitrust regulators and state insurance departments.
The Federal Trade Commission is likely to create a high bar for approving the deal, especially considering the wave of consolidation in the insurance industry, lawyers said. Aetna is hardly the only insurer seeking to get bigger. Anthem and Cigna are reportedly back at the bargaining table this week after Cigna in June rebuffed a $53.8 billion offer.
SOURCE: Beth Kutscher, ModernHealthCare
The Food and Drug Administration has delayed by a year the deadline for the nation’s chain restaurants, pizza parlors and movie theaters to post calorie counts on their menus in what some consumer advocates said was a setback for public health but others contended would simply give companies enough time to comply.
Pressure had been growing to delay the rule, which was proposed in November and would have taken effect at the end of this year. Food companies – in particular, the pizza industry – had campaigned against it, saying it was onerous and in many cases served no purpose, as most Americans order pies over the phone and not in a restaurant, where they would see a menu. A measure in the House sought to delay compliance by a year.
On Thursday, the agency announced that it had done just that to give companies more time to comply. Critics said the delay was not a fatal blow, but was worrisome, as it would give the restaurant and grocery industries more time to lobby against the measure.
“This is a huge victory for the restaurant lobbyists,” said Marion Nestle, a professor in the department of nutrition, food studies and public health at New York University. “Food companies must be hoping that if they can delay menu labeling long enough, it will just go away.”
But the delay may be more about bureaucracy than industry influence. Many who supported the rule said that the agency had yet to issue a crucial guidance document that would help the industry understand how to carry it out, and that with less than six months to go before the original deadline, there was a risk that the rule would create chaos. Some of its strongest backers, including Senator Patty Murray, Democrat of Washington, had called on the agency to delay it.
Michael R. Taylor, the deputy commissioner for foods and veterinary medicine at the F.D.A., said in a statement that the rule’s new implementation date would be Dec. 1, 2016.
One night, when her face turned puffy and painful from what she thought was a sinus infection, Jessica DeVisser briefly considered going to an urgent care clinic, but then decided to try something “kind of sci-fi.”
She sat with her laptop on her living room couch, went online and requested a virtual consultation. She typed in her symptoms and credit card number, and within half an hour, a doctor appeared on her screen via Skype. He looked her over, asked some questions and agreed she had sinusitis. In minutes, Ms. DeVisser, a stay-at-home mother, had an antibiotics prescription called in to her pharmacy.
The same forces that have made instant messaging and video calls part of daily life for many Americans are now shaking up basic medical care. Health systems and insurers are rushing to offer video consultations for routine ailments, convinced they will save money and relieve pressure on overextended primary care systems in cities and rural areas alike. And more people like Ms. DeVisser, fluent in Skype and FaceTime and eager for cheaper, more convenient medical care, are trying them out.
But telemedicine is facing pushback from some more traditional corners of the medical world. Medicare, which often sets the precedent for other insurers, strictly limits reimbursement for telemedicine services out of concern that expanding coverage would increase, not reduce, costs. Some doctors assert that hands-on exams are more effective and warn that the potential for misdiagnoses via video is great.
Legislatures and medical boards in some states are listening carefully to such criticisms, and a few, led by Texas, are trying to slow the rapid growth of virtual medicine. But many more states are embracing the new world of virtual house calls, largely by updating rules to allow doctor-patient relationships to be established and medications to be prescribed via video. Health systems, facing stiff competition from urgent care centers, retail clinics and start-up companies that offer video consultations through apps for smartphones and tablets, are increasingly offering the service as well.