House Passes Budget Framework; Healthcare Cuts Heat Up
The House adopted a budget reconciliation bill today with just one GOP defection. House Speaker Mike Johnson and President Donald Trump got three other doubters to convert to “yes.” The vote was 217 to 215. The bill paves the way for final passage down the road but a great deal of work has to occur, with committees now meeting on spending cut targets. This includes $880 billion in healthcare spending cut targets. Johnson and perhaps Trump convinced holdouts that Medicaid rolls will not be cut except for work requirements and if someone is illegally on the program. It may be hard to keep the commitment with a large reduction bogey. The victory was major for Johnson but he now needs to hold all these folks in place as spending cuts are debated in committees.
Meanwhile, healthcare news is heating up due to the possible spending cuts:
- The Blue Cross and Blue Shield Association (BSCSA) issued a report today that has $1 trillion in healthcare cost reductions over a decade — federal savings of $524 billion, lower private insurance premiums of $389 billion, patient savings of $180 billion. The largest potential area for savings is to adopt site-neutral payments in Medicare, which would save $484 billion over 10 years. I will do a blog on the report next week.
- A Modern Healthcare article explains work requirements and their history in Medicaid.
- The Health and Human Services (HHS) Office of Inspector General (OIG) said that Medicare costs of ten common diabetes medications, including GLP-1s, went up by 364% between 2019 and 2023. In 2019, Medicare spent roughly $7.7 billion. In 2023, the cost reached $35.8 billion.
- Trump plans to sign an executive order to reinforce rules to make healthcare prices more transparent for patients. The order will update agency enforcement policies to make sure healthcare providers and insurers are complying with the rules.
- Insurers overall had a poor 2024 due to various issues, including poor Medicare Advantage (MA) rates. There were a few exceptions.
- A Kaiser Family Foundation (KFF) poll finds that Medicaid is viewed favorably by a large majority (77%) of the public and an even larger share of those on the program (84%). Another poll from Hart Research conducted for the nonprofit Families Over Billionaires finds that 71% percent of voters who backed Trump said cutting Medicaid would be unacceptable.
- A compound pharmacy trade group has filed a lawsuit against the Food and Drug Administration (FDA) for removing semaglutide, the active ingredient in Ozempic, from its drug shortage list. Many Americans use these generic compounds for weight loss due to the $1,000 plus cost of brands. Still, the generic drug costs can be $200 plus a month.
Additional articles: https://www.fiercehealthcare.com/regulatory/bcbsa-report-addressing-hospital-pharma-costs-could-save-1t-over-next-decade and https://www.modernhealthcare.com/policy/medicaid-work-requirements-gop-budget and https://www.beckerspayer.com/payer/medicare-part-d-spending-on-weight-loss-drugs-surges-364-oig.html and https://www.modernhealthcare.com/policy/trump-healthcare-cost-transparency and https://www.healthcaredive.com/news/health-insurer-medical-costs-climbing-ma-medicaid/740611/ and https://www.kff.org/medicaid/report/the-debate-over-federal-medicaid-cuts-perspectives-of-medicaid-enrollees-who-voted-for-president-trump-and-vice-president-harris/ and https://thehill.com/policy/healthcare/5161953-obamacare-medicare-budget-entanglement/ and https://thehill.com/homenews/house/5163381-democrats-medicaid-gop-budget/ and https://thehill.com/policy/healthcare/5163193-trump-voters-oppose-medicaid-cuts-poll/\ and https://thehill.com/policy/healthcare/5163570-weight-loss-drugs-fda-shortage-list-ozempic-wegovy/
(Some articles may require a subscription.)
#healthcare #trump #congress #budgetreconciliation #medicare #medicaid #coverage #siteneutral #glp1s #weightlossdrugs #drugpricing #branddrugmakers #healthplans #hospitals #pricetransparency
https://www.cbsnews.com/news/budget-resolution-house-vote-mike-johnson-trump-agenda
Judge Extends Injunction On Federal Funds Freeze
A federal judge has extended the injunction on a White House effort to freeze federal funds. Theoretically the move preserves the status quo on budget disbursements, but many feel the administration continues to withhold funds.
#trump #spending #doge
Grassley Demands UnitedHealth Group Risk Adjustment Information
The Wall Street Journal said Tuesday that Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, sent a letter to UnitedHealth Group CEO Andrew Witty pushing for a detailed look at how the company handles billing in Medicare Advantage (MA). This comes after the Journal reported that the Department of Justice has an ongoing investigation of risk adjustment coding at United.
Grassley called for information, including audits and internally documented overpayments, on how United reviews diagnoses from health risk assessments and chart reviews.
To me, this makes it clear that there will be bipartisan reform of risk adjustment in MA.
Additional article: https://www.fiercehealthcare.com/payers/wsj-justice-department-investigating-unitedhealths-ma-billing-practices
(Some articles may require a subscription.)
#medicareadvantage #riskadjustment #overpayments #fwa
Big 3 PBMs Will Ask Circuit Court To Stop FTC Actions
The three largest pharmacy benefit managers (PBMs), which are owned by UnitedHealth Group, Cigna, and CVS Health, will appeal a federal court action to the 8th Circuit Court to stop a Federal Trade Commission (FTC) antitrust investigation and lawsuit over insulin pricing. Among other issues, the PBMs argue that the FTC’s lawsuit cannot be heard in an in-house administrative court as it deprives them of due process and unfairly weighs the case in the FTC’s favor. As much as I believe in what the FTC is doing, the PBMs have a point here. This is a bit of the fox watching the hen house.
Additional article: https://www.fiercehealthcare.com/payers/big-three-pbms-seek-appeal-legal-spat-federal-trade-commission
#ftc #antitrust #pbms #drugpricing
— Marc S. Ryan
