Top of the Funnel: Macro + Earnings.
Medicaid Redeterminations Begin Next Week. (MOH (-), CNC (-), ELV (-), UNH (-)) We continued our tour of the MCOs in the context of Medicaid redeterminations with MOH this week. Replay here. Previously we have discussed CNC and HUM which can be found here and here.
Personal Consumption Expenditures. Health Care PCE continued its YoY acceleration in Feb. from 6.1% in Jan. to 6.5%. A 6.5% annual increase in health care PCE is not especially alarming but it continues it will be a thorn in the inflation fighter’s side.
Medicare Trustees Report. The Trustees are now expecting the Medicare Fund to last until 2031, three years later than projected in last year's report. As we have suggested and earnings commentary from EW, HUM and DVA confirm, a significant contribution to the fund's extended life is being made by mortality since 2020. Read it here. The improved longevity of the program is a net positive for the reimbursement environment by taking the pressure off at least for a little while.
CONGRESS.
End of One Emergency. The Senate approved and sent to the president a bill that ends the Covid-19 national emergency. The White House indicated that they would not veto. As we pointed out last week, HHS is preserving its authority to continue to issue EUAs under what is known as a 592 declaration that now considers the potential for a pandemic.
THE WHITE HOUSE.
Naloxone. (EBS (+). The Food and Drug Administration approved the first Naloxone nasal spray. Generic makers of the drug must submit applications to offer their products OTC. Given EBS’s checkered past, it seems likely the generics will quickly edge EBS’ product out.
THE JUDICIARY
Preventive Services and the ACA. (EXAS (-)) Judge Reed O’Connor ruled that provisions of the Affordable Care Act that required coverage of certain preventive services in employer sponsored insurance was a violation of the Appointments Clause and the Religious Freedom Restoration Act.
The claims under the RFRA related to preventive services that may not be condoned or prohibited as part of religious observance. Contraception is the most often cited service that may violate the RFRA.
The claims under the Appointments Clause are broader because the provisions, in effect, prohibits “outsourcing” of government functions to private entities like the United States Preventive Services Task Force.
The USPSTF has for many years reviewed the evidence in support of certain preventive services and graded them. The ACA requires any service that receives an “A” or a “B” to be covered.
Needless to say, there has been an explosion of requests for USPSTF grades since it became a vehicle to reimbursement. EXAS’s Cologuard test is one prominent example.
The Street is probably going to look past this decision as most ACA cases did not amount to much. We are still inclined to watch is carefully as the composition of the court has changed somewhat in recent years.
Other Stuff.
Recent Events.
CNC: Overcoming Medicaid Redetermination, Part I. Link here.
MOH: Overcoming Medicaid Redeterminations, Part II. Link here.
HUM: Only the Strong Survive. Link here.
Venture View w/Marcus Whitney: SVB Fallout. Link here
Have a great weekend.
Emily Evans
Managing Director – Health Policy
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