HealthCare Roundtable e-News – June 3, 2021

Biden’s 2022 Budget Proposal Calls for Medicaid and Maternal Health Improvements, Permanent ACA Tax Credits, Investments in HCBS Workforce

President Joe Biden unveiled his 2022 fiscal budget plans last week, proposing $5 trillion in new federal spending over the next decade to modernize America’s infrastructure and create social safety nets for working families. The president’s proposed budget would be paid for in part by $3.6 trillion in additional revenues over the same period and would result in a net deficit of $1.4 trillion that’s expected to begin shrinking after 2030.

The budget plans call for additional funding for Medicaid, which would see an additional $49.6 billion compared to fiscal 2021. The only Medicaid proposal with a new funding request, however, is for home- and community-based services. The budget proposal requests that Congress appropriate the $400 billion investment in home- and community-based services over 10 years.

Drug pricing is also on the table for the president’s proposed budget, with the White House citing Biden’s support for letting Medicare negotiate payments for some high-cost drugs. A portion of the president’s proposed budget also allocates funds to support maternal health; $53 million for states to implement their own plans to improve maternal care services and address workforce needs, as well as $10 million each for programs that expand screenings, assessments, and treatment for maternal depression. (InsideHealthPolicy)

A few components of the bill will support the president’s campaign promise to expand on the Affordable Care Act, making permanent the enhanced Affordable Care Act tax credits that were enacted as part of the American Rescue Plan with a proposed budget of $163 billion over the next 10 years. Somewhat controversially, the president’s budget plans for expanding the ACA come at a time after Senate health committee Chair Patty Murray (D -Wash.) and House Energy & Commerce Chair Frank Pallone (D-NJ) unveiled their own public health option bill.

According to White House officials, the budget deferred to Congress because several legislative proposals have already been introduced and they believe it’s better to work with lawmakers. Murray praised the president’s budget proposal plans on Friday for including the permanent changes to the ACA tax credits but said more needs to be done. (InsideHealthPolicy)

Health Care Costs Expected to Rebound in 2021 After Historic Drop in 2020

According to a recent study published by Milliman Medical Index (MMI), health care for a hypothetical family of four cost $26,078 in 2020, down 4.2% from $27,233 in 2019. It’s the first time in the study’s 16-year history that health care costs in the U.S. have dropped, due largely to the effects of the pandemic.

The trend isn’t expected to continue, however, as experts who conducted the study anticipate patients will return to hospitals for elective procedures and other scheduled visits. The MMI predicts that in 2021, health care costs for a hypothetical family of four on employer-sponsored insurance are projected to be $28,256.

As people once again return to the doctor, we expect healthcare costs to grow by around 8.4% for our MMI family in 2021,” said Annie Man, co-author of the MMI. “For comparison, that rate is higher than in the past, and higher than GDP growth over the past five years.”

Additionally, the 2021 MMI found that spending on prescription drugs remained strong as mail-order drug delivery surged and drug prices increased. The study also noted that employers’ health care costs increased 4%from 2019 to 2021, with employers’ share of health care costs expected to grow 4.2%.

The 2021 MMI can be downloaded in full, here.

156 House Democrats Sign Letter to Biden on Medicare Expansion in the American Families Plan

Last week, a large majority of House Democrats signed a letter calling on President Joe Biden to prioritize the expansion of Medicare in the president’s American Families Plan. Led by Reps. Pramila Jayapal (D-Wash.), centrist Rep. Jared Golden (D-Maine), Rep. Joe Neguse (D-Colo.), and Rep. Conor Lamb (D-Pa.), the group is seeking to lower the eligibility age for Medicare, expand coverage for dental, vision, and hearing, and decrease prescription drug costs.

The letter was signed by 70% of House Democrats who are asking the president to stick to his campaign promises around the expansion of the Affordable Care Act. Biden’s American Families Plan excluded health care initiatives, intending to keep those health measures separate from his two-part legislative package of the American Jobs Plan (infrastructure) and the America Families Plan. (InsideHealthPolicy)

“Now is a historic opportunity to also make an important expansion of Medicare that will guarantee health care for millions of older adults and people with disabilities struggling with the health and economic realities of the COVID-19 pandemic,” the letter says.

It’s expected that upgrades to Medicare, particularly the inclusion of dental, vision, and hearing coverage supported by a majority of older voters, could cost $350 billion over 10 years. Lawmakers who signed the letter have suggested that the federal government be able to negotiate with pharmaceutical companies to lower the high price of prescription drugs in order to pay for Medicare expansion.

Ambulance Prior Authorization Demo Indicates Higher Savings and Efficiency, but Circumstances May Limit Rollout to Few States

The eight states where CMS launched its Medicare prior authorization innovation model for repetitive non-emergency ambulance transport saved $746 million and reduced transport by 70%, an independent review of the pilot found. However, researchers also determined that the prior authorization policy will likely have different effects in states outside of the demonstration and warned that savings might not be as significant and patient care may suffer as a result.

Mathematica, who performed the analysis, suggested the program still be monitored for patient access problems because doctors and patients said they worry prior authorization might cause patients to delay or miss appointments. Alternatively, the American Ambulance Association supported the prior authorization demonstration as a way to combat fraud in the industry. (InsideHealthPolicy)

The pilot program launched in 2014 in an effort to reduce costs in states with unusually high costs for routine ambulance transports by focusing on repetitive, scheduled, non-emergency ambulance transport. Prior to the pandemic, eight states had joined the demo with a larger nationwide demo set to take place prior to the pandemic stalling the program’s efforts.

“Overall, our results suggest that the model had no adverse effects on quality of care or access to care,” the report says. “We found no increase in emergency department use, hospitalization, or death among model state beneficiaries relative to comparison state beneficiaries.” (InsideHealthPolicy)