U.S. Capitol Building.

Possibilities and Pitfalls of Health Reform Through Budget Reconciliation

By Nicole Huberfeld

The Biden administration entered office promising health reform. But the evenly-split Senate means ten Republican votes are necessary to move major legislation — cooperation that seems unlikely after years of Republican attempts to repeal and obstruct the Affordable Care Act (ACA).

Still, expanding health insurance coverage may be on the menu through budget reconciliation. A budget reconciliation bill progresses with a simple majority vote: special rules limit debate and make filibuster impossible.

The Biden administration has already navigated budget reconciliation to enact speedy health policy measures in response to the pandemic. Signed March 11, the American Rescue Plan Act of 2021 (ARPA) is a reconciliation bill which, among other things, offers federal money to support states’ and localities’ public health needs; facilitates economic recovery; increases tax subsidies provided through health insurance exchanges to expand affordability; and builds on the ACA and 2020 COVID relief bills by offering Medicaid non-expansion states an enhanced federal match of 5% for each enrollee to encourage expansion and counterbalance costs. The ARPA also addresses determinants of health and health equity, for example by extending the option of maternal Medicaid coverage for a year after the 60-day post-partum period and creating a new child tax credit. Most provisions last no more than two years.

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Grafton, Illinois, USA, June 1, 2019 -Car submerged under flood water in small river town, Grafton, Illinois, as Mississippi River floods roads, businesses and houses. vehicle under water, men in boat

Bail Out Humans

By Christina S. Ho

This past year has sensitized us politically to government’s affirmative obligations, especially the duty to backstop health catastrophes in order to dampen the risks that ordinary people must bear. 

Our government bails out large risks in so many other arenas. Yet we too often fail to backstop the most human risk of all — our vulnerability to suffering and death. 

Throngs of scholars have described our deep tradition of government-sponsored risk mitigation to nurture favored private activities and expectations, and relieve those favored actors from catastrophes beyond what they could be expected to plan for. I have characterized this distinctive political role figuratively as one of “government as reinsurer.”

The federal government provides standard reinsurance for private crop insurers, virtually full risk-assumption for private flood insurance, guarantees for employer pension benefits, robust backstops for bank liquidity risks, FHA mortgage insurance and a federal secondary market to absorb the risks of housing finance.

In these arenas and more, statistically correlated or high-magnitude catastrophic losses are shed onto the state in order to smooth out and shore up the underlying private risk market. We have yet to commit similarly in the health care domain. 

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Key Takeaways from Petrie-Flom Center Discussion on Vaccine Passports

As mask mandates fall to the wayside, COVID-19 digital health passes, often called vaccine passports, hold promise as a tool to verify whether individuals may enter a space without a face covering.

Vaccine passports, however, also pose a number of ethical and legal challenges. Panelists discussed these concerns during an April 28 webinar hosted by the Petrie-Flom Center for Health Law Policy, Biotechnology, and Bioethics titled, “Vaccine Passports: A Path to the New Normal?”

This article highlights key points made during the conversation.

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Game of whack-a-mole.

Stop Playing Health Care Antitrust Whack-A-Mole

By Jaime S. King

The time has come to meaningfully address the most significant driver of health care costs in the United States — the consolidation of provider market power. 

Over the last 30 years, our health care markets have consolidated to the point that nearly 95% of metropolitan areas have highly concentrated hospital markets and nearly 80% have highly concentrated specialist physician markets. Market research has consistently found that increased consolidation leads to higher health care prices (sometimes as much as 40% more). Provider consolidation has also been associated with reductions in quality of care and wages for nurses

In consolidated provider markets, insurance companies often must choose between paying dominant providers supracompetitive rates or exiting the market. Unfortunately, insurers have little incentive to push back against provider rate demands because they have the ability to pass those rate increases directly to employers and individuals, in the form of higher premiums. In turn, employers take premium increases out of employee wages, contributing to the growing disparity between health care price growth and employee wages. As a result, rising health care premiums mean that every year, consumers pay more, but receive less. 

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doctor holding clipboard.

Transformation of Behavioral Health Care Through Section 1115 Waivers

By John Jacobi

As the Biden administration works to improve health access and transform health delivery, behavioral health reform should be at the front of the queue.

People with severe mental illness and opioid use disorder are dying young for lack of routine health care. Much of the work that needs to be done in behavioral health is developed or developing at the state level. But the Biden administration has a powerful tool for encouraging state-level innovation in the § 1115 Medicaid waiver process.

Reform through state waivers

Section 1115 waiver authority permits the Department of Health and Human Services to approve pilots and demonstrations if they are found likely to promote the objectives of the Medicaid program. Waivers, which do not require Congressional or formal regulatory enactments, permit relatively rapid cycling of innovation, in contrast to the lumbering pace of legislative or regulatory change.

While applications for waivers originate with the states, presidents have set the agenda by signaling what categories of waivers will be looked upon favorably, offering the administration the ability to put its stamp on the development of care for low-income and disabled people.

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Hand holding pencil drawing a path.

Roll Back Harmful Section 1115 Waivers: Charting the Path Forward

By Sidney D. Watson

On March 18, 2021, the U.S. Department of Health and Human Services (HHS) sent formal notices to Arkansas and New Hampshire that it was withdrawing their Section 1115 waivers that allowed the states to require poor adults to work as a condition of Medicaid coverage.  

This appears to be the first time that HHS has invoked its authority to rescind an approved 1115 waiver. It won’t be the last. 

Waiver withdrawals provide a path forward for the Biden administration to end a grab bag of Trump-era Section 1115 waivers that create a risk of loss in coverage and harm to Medicaid beneficiaries.  

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WASHINGTON, DC - OCT. 8, 2019: Rally for LGBTQ rights outside Supreme Court as Justices hear oral arguments in three cases dealing with discrimination in the workplace because of sexual orientation.

Now Is the Time for a Sex-Based Civil Rights Movement in Health Care

By Valarie K. Blake

The Biden administration and all three branches of government are poised to finally deliver a sex-based civil rights movement in health care that generations have waited for.

Sex discrimination is prevalent in health care, but especially so for LGBTQ people. Combine this with other forms of discrimination that LGBTQ people experience, and the result is a population that suffers from serious health disparities, including heightened risks of mental health conditions, substance use disorders, and suicide.

A much needed ban on sex discrimination in health care finally passed in 2010, as part of the Affordable Care Act (ACA). Section 1557 of the ACA prohibits health care entities that receive federal money from discriminating on the basis of sex, along with race, age, and disability. Specifically, Section 1557 bans sex discrimination in health care by way of extending Title IX, which previously applied to educational entities only. Section 1557 reaches most hospitals, providers, and insurers. Sex equality in health was a long time coming. Similar bans on discrimination by recipients of federal money had passed decades earlier: race discrimination in 1964, disability discrimination in 1973, and age discrimination in 1975.

Despite its historic nature, Section 1557 has yet to deliver on its promise, owing to delays and volatility in rulemaking and near-constant litigation. The statute was barebones, requiring interpretation, but the Obama administration only promulgated a rule and began full enforcement six years after the passage of the ACA. The Obama rule broadly banned gender identity and sexual orientation discrimination, but the part of the rule banning gender identity discrimination was judicially stayed only months later in Franciscan Alliance v. Burwell.

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Hand arranging wood block pyramid with health icons on each block.

ERISA Preemption Reform: Unlocking States’ Capacity for Incremental Reform

By Elizabeth McCuskey

For the past 46 years, the Employee Retirement Income Security Act (ERISA) has preempted state regulation that “relates to” employer-sponsored health benefits. 

Much has changed in health care and society over that time; but ERISA’s preemption abides — widely maligned, yet unaltered. An ERISA preemption waiver thus presents a long-overdue update to health care regulation with a lot to recommend it to the Biden Administration’s health care agenda: it enables states to “strengthen and build on the Affordable Care Act,” it offers a modest incremental step that could pave the way for bigger structural change, it prompts no federal spending, and it has bipartisan political support. 

The preemption provision in 1974 was supposed to entice multistate employers to offer benefits by creating some federal uniformity in benefit regulation. For health benefits, however, that uniformity has been largely deregulatory.

ERISA preemption currently prevents states from fully enforcing a wide variety of health reforms, ranging from claims data collection to state-level employer mandates. And it casts a pall of private litigation challenges over even the ones that should be enforceable, like surprise billing regulation, prescription drug pricing measures, and state and local public option plans.  

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stethoscope, pills, ampules, and notepad with "claim denied" written on it.

Preserving Meaningful External Review Despite Insurers’ Rulification of Medical Necessity

By Daniel Schwarcz and Amy B. Monahan

Increasingly, health insurers are crafting their coverage terms in ways that undermine a vital consumer protection created by the Affordable Care Act (ACA): the right to appeal health plan claim denials that are based on medical judgments to an independent, external reviewer. The ACA extended this right to all health plans to protect consumers against the risk of unreasonable coverage determinations — a risk that is all too familiar given insurers’ financial incentives to deny claims.

Yet, as revealed by our new article, Rules of Medical Necessity, this essential consumer protection is becoming increasingly illusory as health insurers shift from broad standards to concrete rules for defining when care is medically necessary. For that reason, this post proposes that the Biden/Harris administration should promulgate rules allowing external reviewers to set aside insurers’ rules of medical necessity even when they are contained in insurance policies or formal health plan documents. Instead, federal regulations should make clear that the ACA requires external reviewers to apply traditional, standard-based, definitions of medical necessity when reviewing denials of coverage that are premised on medical judgments.

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U.S. Capitol Building at Night

A Legislative Override Could Save the ACA (and Fix Other Misapplications of Health Laws)

By John Aloysius Cogan, Jr.

The Congressional Democrats and the Biden administration need not wait for the Supreme Court to determine the fate of the Affordable Care Act (ACA) in California v. Texas; they can take charge of the case today by enacting and signing into law overriding legislation. 

Since the threat to the ACA is based on the interpretation of a federal statute — the ACA’s “inseverability clause” — Congress is within its rights to take charge of the case. Why? Because courts are not the final word on the meaning of a statute, Congress is.

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