Friday, February 26, 2010

Summit ends without definite next steps for reform

Despite the spirited discussion at Thursday’s bipartisan health care summit, Congressional leaders made little progress in the way of substantial policy decisions or negotiations. Both parties agreed that cost containment and insurance market reforms to help individuals and small businesses obtain affordable coverage are necessary reform components, yet there was little consensus on how to achieve this.

In response to the President's plan, Republicans asserted that the $950 billion proposal does little to control costs and does not include the major reform measures favored by the GOP. Obama concluded the summit by allotting up to six weeks for continued health reform discussion in an attempt to reach bipartisanship, but implied that a Democrat-only bill by way of reconciliation is still a possibility.

Released Monday prior to the summit, Obama’s proposal reflects the Senate-passed health care bill but attempts to improve on some of its less popular components. While the Congressional Budget Office has not officially scored the proposal, the White House projects a $950 billion price tag over 10 years.

Key provisions
• Includes an individual mandate but lowers penalty to $325 in the first year
• Closes the “donut hole” for Medicare prescription drug beneficiaries
• Delays 40% excise tax on so-called Cadillac plans until 2018
• Endorses state-based exchanges rather than a public option
• Gives federal government power to block excessive premium increases by insurance companies

Major funding mechanisms
• Raises Medicare payroll tax on couples making more than $250,000 a year
• Imposes fees on drug companies and large employers that do not provide group health insurance
• Includes measures to eliminate Medicare fraud and waste

Thursday, February 25, 2010

Interim COBRA subsidy extension expected

A stopgap measure is expected to be introduced late this week by Senate Majority Leader Harry Reid (D-Nev.) to extend the COBRA subsidy to employees involuntarily terminated from March 1 through either March 15 or March 31. The purpose of this short extension is to give lawmakers time to construct a broader bill that would extend the 65% premium subsidy by as much as a year.

While an extension of the subsidy through May 31 was part of the Senate Finance Committee’s bipartisan jobs bill, the provision was removed in an effort to focus the bill on job creation. Reid is expected to propose a multi-month COBRA subsidy extension in coming weeks as part of additional jobs-related legislation.

The current COBRA extension in the Department of Defense Appropriations Act, 2010 (2010 DOD Act) is set to expire at the end of this month. The Act expanded upon the American Recovery and Reinvestment Act of 2009 (ARRA) by extending the COBRA subsidy to those who lost group coverage due to involuntary termination through February 28, 2010, rather than December 31, 2009.

This legislation also included provisions to:
• Extend the period of the COBRA subsidy from 9 to 15 months;
• Mandate that group health plans provide a notice within 60 days describing the 15-month premium subsidy to all subsidy-eligible individuals on COBRA or eligible for COBRA on or after October 31, 2009; and
• Require group health plans to allow a period for retroactive premium payments from individuals whose subsidy expired on November 30, 2009 and failed to make the December COBRA premium payment.

In North Carolina, the current subsidy extension also applies to State Continuation members.

Friday, February 19, 2010

Obama to release health reform plan Monday prior to televised summit

In conjunction with Obama’s call for a televised bipartisan summit on health care reform, the President announced he would post his own bill online prior to the event. Recent reports indicate the President’s plan will be on the Internet as early as Monday morning. While a combination of the current Congressional bills may be expected, Roll Call reports that “a senior Democratic aide said Thursday evening that the bill was assembled without any input from House and Senate Democratic leaders, and cautioned that it should not be viewed as an agreement to reconcile the two chambers' bills.”

The half-day meeting will be held at Blair House and will be broadcast live at 10:00 a.m. ET on February 25th. While health reform talks have been at a near standstill since Brown’s Massachusetts Senate victory nearly a month ago, Thursday’s summit will play a key role in determining whether comprehensive health care reform passes this year.

$3.8 trillion budget proposal assumes passage of health care reform

On February 1st, the President released his $3.8 trillion budget proposal for fiscal year 2011. While the proposed budget focuses on job creation and the economy, it also assumes the federal passage of a health care reform bill in 2010 and the accompanying $150 billion in savings that such a bill would generate over the next 10 years.

Big ticket health care allocations in the proposal include:
• $25 billion: 6-month extension of stimulus funding through June 2011 for state Medicaid funding
• $10 billion: 10-year spending plan to reduce childhood obesity
• $6 billion: 12-month extension of COBRA premium subsidy for those who have lost their jobs during 2010
• $296 million: comparative effectiveness research on best practices for disease treatment and prevention
• $290 million: community health centers
• $188 million: health IT and data improvement
• Additional funding for Veteran’s Affairs medical programs, the Indian Health Service, HIV/AIDS initiatives, and Autism research and treatment

Following the release of the budget proposal, Congress begins the resolution process to establish policies and priorities for 2011. It remains to be seen whether the House and Senate will pass a health care reform bill this year. However, the substantial allocations for health care supported by the President's remark that his proposal "includes funds to lay groundwork for these reforms" may encourage compromise among legislators.

UHC to change network status for Cornerstone Health Care, PA

Due to current unresolved issues between Cornerstone Health Care, PA and United Healthcare, Cornerstone will temporarily stop participation with the UHC plan. Effective May 30, 2010, Cornerstone will be out-of-network for UHC members unless these issues can be resolved before then.

While unfortunate, network status changes do occur. From our experience, providers that become out-of-network are often reinstated to the network before the effective termination date or shortly after. Cornerstone and UHC are making efforts to come to an agreement as soon as possible.

We will continue to keep you updated as Cornerstone and UHC work towards a favorable agreement. As always, please feel free to contact us with any questions or concerns that arise.

Thursday, February 18, 2010

BCBSNC to increase restricted-access drugs

Effective April 1, 2010, BCBSNC will expand its restricted-access drug list for the following classes:

Triptans: commonly used in migraine therapy; users of non-preferred triptans (Amerge, Axert, Frova, Sumavel DosePro, Treximet, Zomig, and Zomig ZMT) will be required to try sumatriptan (generic Imitrex), Relpax, Maxalt or Maxalt MLT before the non-preferred drug will be covered.

Selective Serotonin Reuptake Inhibitors (SSRIs): commonly used to treat depression, obsessive-compulsive disorder and/or anxiety disorders; new users of non-preferred SSRIs (Lexapro, Luvox CR and Pexeva) will be required to try the generics citalopram, fluoxetine, fluvoxamine, paroxetine, or sertraline before the non-preferred drug will be covered.

Hypnotics: commonly used to treat insomnia; users of non-preferred hypnotics (Ambien CR, Edluar, Lunesta, Rozerem, and Zolpimist) will be required to try the generics zaleplon or zolpidem before the non-preferred drug will be covered.

These restrictions are meant to encourage the use of generics and preferred brand-name drugs in an effort to provide quality, cost-effective health care. BCBSNC will send notification letters to affected members next month. Click to access the Sample Client Letter and Drug Update FAQ from BCBSNC.