Top of the Funnel | Macro Data, Policy Position Monitor
CPI. Health care services received some of the credit for the hot CPI print this week. Since price setting in health care generally occurs once a year – in October for much of Medicare and January for the rest of the vast financing system. CPI-M is driven mostly by the cost-sharing associated with health care services. In that bucket, hospital and physicians’ services are the largest contributors.
Since services have not yet been repriced, the acceleration in CPI-M can be mostly attributable to higher acuity and/or more aggressive (or more accurate, pick your reason) coding.
In October, we should see some effect from increased rates for a portion of Medicare as has been the case in prior years. In January, we will see the effect of changes to benefit designs in the employer sponsored market plus increased premiums.
Health care, which has embraced inflation for decades, will continue to cost somebody more.
(NOTE: Remember that ASCs are reimbursed by Medicare based on CPI so they should outstep other payment models in the coming months/years.)
No changes to the Policy Position Monitor found here.
CONGRESS
Prior Auth. ((HUM (-), UNH (-), ANTM (-), HCA (+), THC (+), SGRY (+)) House passed a bill requiring Medicare Advantage plans to streamline prior authorizations. Among other things, the bill calls for real-time approvals for common items and services and greater transparency and reporting.
The bill comes in the wake of a report from the Office of the Inspector General who found MA plans used prior authorization inappropriately. It has bipartisan and bicameral support and could be tacked on to the year-end spending bill.
Prior auth, also known as “utilization management,” by the plan sponsors is a vital lever for controlling benefit expense. If you listen to the anecdotes and the glancing references to it on earnings calls, it may have been exploited these last few months as both sides of the health care financing coin try to protect their margins.
The bill has a lot of muscle behind it with most of the hospital and physician lobby in support. The wild card is CMS which tends to favor the insurance industry.
FDA User Fee Legislation. An agreement on a five-year extension of the FDA’s under fee legislation is expected this week. At issue are the policy riders. Sen. Richard Burr wants a clear bill that can pass without much controversy and be attached to the Continuing Resolutions that muse pass before month end.
A clean bill probably leaves the regulation of Laboratory Developed Tests out in the cold as the House did not include it in their bill and its main advocate, Sen. Burr is dropping it in favor of expediency.
THE WHITE HOUSE.
BioTech Executive Order. The White released an order outlining certain priorities of the administration related to the biotechnology industry in an attempt to promote innovative solutions in “health, climate change, energy, food security, agriculture, supply chain resilience, national and economic security.”
Nice stuff but the real purpose appears to be to direct the relevant federal agencies to examine the risks and security of biotech innovations. Regardless of whether you buy the lab leak theory of SARS-CoV-2, some of the research supported by NIH has not survived peer scrutiny of topics like “gain of function research.”
For the lay person, federally subsidizing the development of viral agents to fight the next pandemic, seems pretty crazy. The pandemic industry is large and well-funded so it remains to be seen what limits are placed on NIH, BARDA et al.
Other Stuff.
Denmark Limits Vaccination Program. (PFE (-), MRNA (-), BNTX (-)) Although, like nearly everyone else, the Danish Government expects higher case rates for Covid this fall and winter, they are now limiting vaccinations, on request, to people over 50. People under 50 can request a vaccination in certain circumstances, like a health condition that compromises the immune system. The Danish Health Authority notes that a vaccination does not stop transmission and young people are not at any particular risk.
The UK set similar policy goals, also noting the likelihood of mild disease, the Health Ministry updated their guidance on Sept. 4th to emphasize high risk groups. The U.S. remains an outlier.
Politico Reports. It is a long-over due analysis of the pandemic industry published in Politico this week. Assuming you think the scale and scope of the SARS-CoV-2 vaccine programs was entirely benign, one take-away could be that the four horsemen of the pandemic, GAVI, CEPI, WHO and the Bill and Melinda Gates Foundation filled necessary gaps in the pandemic response.
If, however, you see some significant downsides to a vaccination campaign that was not risk stratified and ignored prior immunity, you may conclude that there is way too much self-interested and frequently-funded-by-Pharma money flowing through NGOs with financial conflicts.
Either way, it is an important article that takes on a public health concern.
Recent Events
The Failure of (Federal) Science with Dr. Tracy Beth Hoeg.
mRNA Technology: More Downside Than Upside, a Discussion with Dr. Aditi Bhargava.
Upcoming Events
PFE: Bad for America Part II Tuesday, Sept. 27th at 12:30 pm. Watch for Invite
Have a great weekend.
Emily Evans
Managing Director – Health Policy
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