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More Data Needed On Medicare Advantage Payments While the authors of a Health Affairs Forefront blog appear to be sympathetic to charges that Medicare Advantage (MA) is considerably overpaid, they do admit that more data needs to be shared in order to conclude what many academics find with faulty data. They note that MA now costs about 14% of federal outlays and is projected to grow to 18% by 2034. They repeat the dubious statistic that payments to MA plans exceed by 20% what Medicare would spend in the traditional program. But the authors do note that none of the relevant agencies (the Congressional Budget Office, the Office of Management and Budget, the Medicare Payment Advisory Commission, the Medicare Trustees, or the Centers for Medicare and Medicaid Services Office of the Actuary) has released public assessments of what Medicare spending would be now or in the future, adjusted for health

Senate GOP Looking To Change House Budget Reconciliation Bill Senate Republicans say they’re going to rewrite the 1,116-page budget reconciliation bill the House passed on a tight vote. House Speaker Mike Johnson, R-LA, says the Senate needs to be judicious and make minimal changes to avoid another showdown in the House that could sink the bill. But Senate Majority Leader John Thune, R-SD, said his body will definitely have an imprint on the bill. The Senate is generally far more independent than the House. The ideological split we saw in the House is now emerging in the Senate. Rightist Rand Paul, R-KY, will vote against the bill given the provision that increases the debt limit dramatically. Conservatives Ron Johnson, R-WI, Rick Scott, R-FL, and Mike Lee, R-UT, argue much deeper cuts need to occur. Johnson says the bill has a $2.2 trillion deficit on average each year and the bill

Reconciliation Bill Already Creating Anxiety In Senate As the House budget reconciliation bill moves to the Senate, signs are appearing already of a deep ideological divide over the bill. At least two conservatives, Rand Paul, R-KY, and Ron Johnson, R-WI, have questioned whether they will vote for the bill – Paul due to the debt limit provision and Johnson because of too few spending cuts and surging debt. At the same time, moderates and pragmatic conservatives are pushing for Medicaid reductions to be rolled back. Both Lisa Murkowski, R-AK, and Josh Hawley, R-MO, want Medicaid changes. Susan Collins, R-ME, has also weighed in on Medicaid in the past. There are others, too, who are concerned. As such, the Senate has too few votes to pass the House version due to opponents on each side. See my blog today for more details: https://www.healthcarelabyrinth.com/the-budget-rollercoaster-reconciliation-advances-but-big-debate-looms-in-senate/ . In other news, a Modern Healthcare article

House Passes Reconciliation Bill; On To An Uncertain Fate In Senate (UPDATED 5/22 AM) The House threaded the needle and passed the budget reconciliation bill on a tight 215-to-214 vote. Two Republicans voted against the bill, and one voted present to get the bill to pass. The vote was a result of a marathon session and backroom arm-twisting by President Trump, House Speaker Mike Johnson, and other House GOP leaders. President Trump met with the caucus this week and laid down the law, telling moderates to drop their SALT demands (they did to some degree) and conservatives not to “f—” with Medicaid. The House leaders thread the needle by a mix of further concessions and appealing to party unity. The conservatives wanted additional Medicaid structural changes and accelerated reductions. They were conceded acceleration of work requirements from 2029 to essentially 2027. It is likely impossible for states to do so

HHS Explains MFN Drug Price Approach The Department of Health and Human Services (HHS) issued guidance regarding President Donald Trump’s recent executive order regarding adopting most favored nation (MFN) drug pricing throughout the country. If Big Pharma brand drug makers were not worried before, they should be now. An HHS press release laid out expectations for how drug makers will engage with the order. It notes all brand products that do not currently have generic or biosimilar competition across all markets (lines of business) are covered. It says drug companies must “commit to aligning” their U.S. prices with “the lowest price of a set of economic peer countries.” The peer group is the so-called rich nations as represented by the Organization for Economic Co-operation and Development countries and that have a gross domestic product (GDP) per capita of at least 60% of the U.S. GDP. Big Pharma came out swinging,

House Budget Committee Advances Reconciliation Bill After a high-profile defeat Friday, the House Budget Committee advanced the budget reconciliation bill with $625 billion in Medicaid reductions Sunday night. Four House Freedom conservatives in the GOP caucus voted present to advance the bill, apparently with commitments that changes will be made to the bill. A prominent conservative, Chip Roy, said work requirements would be accelerated. He also mentioned the need for steeper provider tax cuts and a rollback of the enhanced reimbursement for the Medicaid expansion. If all House moderates are on the bill now (a big if), they would likely jump off with steeper Medicaid cuts. Providers and doctors are sounding the alarm on coverage losses, lower state dollars, administrative costs, and red tape. Health policy group KFF published two briefs: one on the 15 states that would be impacted with lower reimbursement if they maintain undocumented immigrants and the

Conservative Rebellion On Budget Bill Conservative House members on the Budget Committee sent shock waves through the Capitol Friday when they stopped advancement of the budget reconciliation bill over a lack of sufficient spending cuts. In some ways, the meltdown could be predicted, but the fact that the five conservatives defied the wishes of the president and leaders showed just how fragile the GOP’s hold on Congress is. Speaker Mike Johnson already had a huge issue on his hands when it came to moderates from Blue states asking to increase state and local tax reductions. Now, he has the conservatives off the bill, which could then spur more moderate concern if cuts go deeper. Principally, the conservatives want work requirements to be imposed much earlier than 2029 and to see tighter eligibility in Medicaid. They complain that cuts are backloaded and spending front-loaded. The bill will be discussed behind the

Budget Reconciliation Saga House Freedom Caucus members could sink the budget reconciliation bill coming out of the Budget Committee for lack of enough reductions and weak Medicaid policy changes. Conservatives are pushing for an acceleration of work requirements from the current plan targeted for 2029. At the same time, moderates are upset with the scope of Medicaid reductions. House Speaker Mike Johnson also said that the proposed bill would be changed to enhance state and local tax deductions as well as increase Medicaid savings. But the latter could further upset moderates. The current reductions fall disproportionately on states, which will have to make up hundreds of millions of reimbursement reductions, as well as enrollees, who could lose coverage. Another controversy is ambiguous language regarding provider taxes. While new provider taxes are barred, it is unclear how long existing taxes would be grandfathered or whether renewing current provider taxes would be

Medicaid Cuts Advance In House After a marathon overnight hearing where lawmakers literally fell asleep in their chairs, the House Energy & Commerce Committee advanced on a party-line vote deep Medicaid spending reductions in the budget reconciliation process. The cuts amount to $624 billion in Medicaid over 10 years. New provider tax bans, cost-sharing for certain populations, and work requirements are some of the largest reductions. Democrats proposed to tackle Medicare Advantage (MA) overpayments instead. They, too, wanted to use savings from President Trump’s recent executive order to reduce drug pricing. While the reductions advanced, a deep divide is quickly emerging. Moderates and conservatives are still at odds in the House. Conservatives claimed that the reductions are not deep enough, while many moderates could be off the bill due to the existing Medicaid cuts. Some moderates and pragmatic conservatives in the Senate are also concerned about the Medicaid cuts. In

Providers React To Medicaid Cuts Protests broke out at the Capitol and providers and advocates reacted to Medicaid reductions in a draft framework of the budget reconciliation bill. Provider taxes are especially getting attention. The bill proposes to freeze all new provider taxes, while a proposed administration rule would rein in what the administration calls provider-tax waivers that violate the spirit of the law. Limits on state directed payments, often funded by provider taxes, would occur as well in the reconciliation bill. In other news, the Trump administration says it plans on revisiting the mental health parity rule. In addition, doctors appear to be on the verge of some relief in terms of a Medicare physician rate fix. While no relief will be granted in 2025, in 2026 rates would increase by about 2.25% and future increases would be linked to the Medicare Economic Index, which generally rises faster than