Top of the Funnel | Macro
Slow and Steady Wins the Race. It isn’t dramatic and you can almost see the health care system straining against its limited capacity. In November, Personal Consumption Expenditures increased 5.07% YoY but decelerated slightly MoM from 0.53% to 0.42%
CONGRESS.
Omnibus. I am going to assume the House passes this bill today or tomorrow. Assuming that is the case, here are a few highlights:
- Medicaid off-ramp. Congress is separating the end of the public health emergency from the required Maintenance of Effort in exchange for a 6.2% increase in FMAP. States will have a glide path in Q2-Q4 to pre-pandemic FMAP levels. More detail in Thursday’s Chart of the Day note here.
- Streamlined pathway for post-partum care.. There is happy agreement that the 60-day baseline coverage period for post-partum care should be extended to one year as state of all shades have been doing so.
- Continuous Coverage. States will provide 12-months of continuous coverage for children regardless of eligibility once redeterminations begin.
- Another PAMA delay. The Omnibus would push the PAMA reporting a phased-in cuts back a year.
- Home Health. The industry did not get relief from the meager 0.3% payment increase in 2023 but it did get a little more transparency on CMS’s calculation of the controversial behavioral adjustment.
- Physicians Fee Schedule. Another half a loaf. Docs will get relief from 4.5% cut in the Physicians fee schedule conversion factor in the form of a 2.5% mitigation in 2023 and 1.25% in 2024.
- FDA Reforms. The bill would require drug sponsors to begin post-approval studies before the FDA approved under the accelerated pathway and allows the use of “real world evidence” in trials. The bill would also endorse the use of decentralized clinical trials and use of digital technologies in research studies.
- Telehealth Rules. Medicare’s telehealth flexibilities will be extended until 2025. This move further separates many of the rule suspensions from the public health emergency.
- NIH. NIH’s appropriation will increase just 2.5% in 2023, a cut on a real basis. However, Congress has settled the issue on ARPA-H’s home. It will be part of NIH, which almost guarantees it will not be particularly successful.
Not in the bill is the VALID Act which would have regulated Laboratory Developed Tests on a risk stratified basis. Also, not in the bill are prior authorization requirements for Medicare Advantage plans. However, CMS has undertaken rulemaking that should address many of Congress’ concerns.
The cannabis banking bill known as SAFE got the cold shoulder as well. Unlike the other stiff-armed provisions, this one is probably not going to get consideration in 2023. Law enforcement has raised concerns that Republicans and moderate Democrats would like to see addressed.
From our perspective, the moment has passed. Crime has raised its ugly head once again as a top issue and legal weed is not likely to be viewed as a net positive.
Making it into the bill are Sen. Ron Wyden's Mental Health provisions. More on that next week.
THE WHITE HOUSE.
Vaccine Strategy. The FDA will convene the VRBPAC on Jan. 26th to discuss how the Covid vaccine regime should be modified and make recommendations on authorizations and approvals. It should be a blockbuster event as manufacturers, the CDC and NIH will all be there.
There are partisan differences with self-identifying Republicans leading the way but, importantly, independents in the mix as well.
Florida’s Grand Jury. As expected the Florida Supreme Court granted Governor Ron DeSantis’ request for a Grand Jury inquiry into claims made about the safety and efficacy of Covid vaccines. The panel has 12 months and subpoena power to complete the task. Expect indictments as the Governor would probably not have asked for a Grand Jury if he already knew what they are going to find.
Other Stuff.
A Kaiser Family Foundation survey released last week indicated that 71% of parents believe health children should be immunized against MMR, down from 82% in 2019. About 1/3 believe parents should decide whether to vaccinate their children, an increase from 16% in 2019.
Testing No More. The Society for Healthcare Epidemiology of America has recommended that health care systems stop testing asymptomatic patients. They cited a small benefit was outweighed by delays in care. An asymptomatic patient can spend almost two more hours in the emergency room waiting for test results.
Recent Events
Venture View with Marcus Whitney: Down Rounds, Exits and 2023.
Replay | Where to From Here? MCOs: 2023 Outlook; HUM, CNC; MOH, ELV
Have a great holiday weekend!
Emily Evans
Managing Director – Health Policy
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