A few interesting things are happening in the Bay State this week on healthcare policy:
It’s early still, but Massachusetts is on track to implement 1332 waiver reforms in 2017. See initial ideas here: https://t.co/PhMTDRRbsj
— Galen Benshoof (@benshoof) November 18, 2015
Wyden/1332 waivers are state innovation waivers for PPACA. As long as states spend no more money and cover the same or greater number of people, the Federal government will allow states to be very experimental with how they deliver near universal coverage to their residents. Massachusetts is putting together an application for a waiver. There are a couple of key points that would be notable for the typical resident of Massachusetts.
*Rolling up metal bands to simplify decision making (a lot like I proposed earlier this year)
* More cushion in calculating subsidies so the cliffs are not as steep
* Fixing the family glitch
I like the first point as personal pique, but the family glitch fix is the big deal here. The Family Glitch currently does not allow subsidies to flow to uncovered family members IF there is a single person in the household who is offered affordable single person coverage at work. Massachusetts will want to tweak several other things on the back end to make things run smoother, but the Family Glitch fix is the big take-away from the discussion list. They’ll need to submit an application for approval by late winter if they want approval by the time open enrollment comes around. And from the Boston Globe:
Harvard Pilgrim Health Care has agreed to cover Amgen Inc.’s pricey new cholesterol drug in exchange for a discount, along with potential rebates if the treatment fails to meet performance targets. The companies said the deal was the first pay-for-performance contract for the cholesterol drug, called Repatha, though Amgen is negotiating similar pacts with other insurers… Harvard Pilgrim agreed to include Repatha as the only PCSK9 drug in its formulary, the list of medicines for which it reimburses health care providers who prescribe them. Amgen, meanwhile, agreed to a discounted price and to additional rebates if the drug doesn’t reduce cholesterol to specified target levels for different patient groups and if the total dollars it pays out exceeds another target. The parties wouldn’t disclose any of the financial details.
Negoatiating an exclusive contract for a drug with near substitutes is no big deal. It happens all the time (see Solvaldi and Harvoni, or Cialis and Viagra). The interesting thing from my point of view is the pay for performance component of the deal. The drug maker offers a lower per dose price and performance guarantees that patients will get better. For expensive specialty drugs, pay for performance is the way things are heading as this country does not want to pay tens of thousands of dollars per targeted individual per year in useless medication.
CHIA’s new Massachusetts Medical Loss Ratios (MLR) brief. See: https://t.co/H7HwBXFLcQ pic.twitter.com/zeG4ZAVAUd — Massachusetts CHIA (@Mass_CHIA) November 19, 2015
Massachusetts already has higher than federal minimal MLR requirements. The biggest difference is on the Massachusetts merged market which is a combination of the individual and small employer group markets. Massachusetts requires an MLR of 90% instead of the federal 80%.
Administrative spending25 was higher within the Medicare Advantage payers ($78 PMPM) than commercial payers ($39-$46 PMPM) on MassHealth Managed Care Organizations ($28 PMPM). Similarly, MassHealth MCOs spent less on health care quality improvement and fraud detection and recovery efforts than did Medicare Advantage and commercial payers ($1 PMPM vs. $3-$12 PMPM)26 Early 2014 data show similar spending levels
Another Holocene Human
The family glitch is huge. Biggest issue with PPACA besides the one John Roberts created.
Richard Mayhew
@Another Holocene Human: Yep, that and the 400% FPL cut-off for subsidies are where Blue States can have the biggest bang per written word in the waiver application.
jharp
“The Family Glitch currently does not allow subsidies to flow to uncovered family members IF there is a single person in the household who is offered affordable single person coverage at work.”
I have a good friend who claims the opposite is true for his family members.
He is offered coverage at work. His family is not. Thus his family uses the exchanges and they do receive subsidies.
I will check with him today to make sure this is the case.
MomSense
Another reason for me to move to Massachusetts.
beltane
This all looks very promising. It is a relief that having a Republican governor isn’t causing Massachusetts to go the way of Maine.
p.a.
R, what was the problem with Vermont’s attempt at single-state single payer? Simply too small a population?
gvg
“household” may be a key word. If a kid is between 18 and 26(?), they have the option of staying on parents plan but aren’t required to so they may sometimes find the exchanges are the better deal I think. In addition most employer plans have a very nuclear family definition of household. My sister and I live together and own a house together. She adopted our joint foster son so he is her son under law but I have as much do do with his upbringing and he flatly refuses to call me aunt. Confuses people that he has 2 mommys that aren’t gay. Anyway she is well paid but her insurance choices are not as good as my state employed choices plus her profession has more job changes. I’ve worked the same place for 22 years. I really wish I could get either or both onto my plan. Especially him. the state of florida privatized adopted childrens medicaid and it’s turned into a real pita. I know of quite a few households of multiple generations and relatives that are not the standard nuclear. There are also step family combinations which also might make it more of a strategic choice to be on a particular household insurance. In fact I’ve seen divorce decrees that say which parent has to do the insurance and it’s not always the custodial parent. Judges know perfectly well that some employers offer good insurance and others don’t.
Richard Mayhew
@p.a.: Lots of problems. The biggest one is that Vermont could not find a way to do a transition that would not be extremely painful to middle and upper middle class people who already have good employer sponsored insurance.
https://balloon-juice.com/2014/12/22/saying-good-bye-to-the-single-payer-dream/
Yutsano
@p.a.: They balked at the tax increase from what I understand. It’s not THAT hard a sale to make really, Yes your taxes go up but you don’t have expensive premiums or huge premium shocks anymore. So Shumlin pulled the plug.
p.a.
@Richard Mayhew: @Yutsano:
Well since part of the idea behind ACA is to break the employment/insurance connection (already fractured by political & economic realities) could this lead to a long term movement (more like a crawl) to single payer? (Probably giving Dem pols way to much credit for long-game thinking)
Amir Khalid
I typically don’t comment on Richard’s health-insurance posts — I don’t have much to add to the conversation, for obvious reasons — but I can’t resist this piece of healthcare news from the BBC website: it only takes a fortnight or so to train a pigeon to identify cancerous breast tissue in a mammogram image.
p.a.
@Amir Khalid: and no Tory in Commons caused a shitstorm about a miniscule budget item paying for the training? Unpossible. Those Brits have a lot to learn.
Richard Mayhew
@Amir Khalid: That must be quite deflating to a lot of highly paid and massaged radiologist egos.
Just Some Fuckhead, Thought Leader
Can we get a Fuck This Shitty Blog Redesign Open Thread?
Fair Economist
Glad to see a state addressing the big issues with the subsidies. I suppose the family problem is most consequential, but the subsidy cliff is what really gets my goat.