Reform Rodeo

1. NPR has a story about the Obama Administration’s move to accept a bipartisan proposal that will allow states to opt-out of some of the ACA regulations if they can provide a suitable alternative.

2. Respectful Insolence has a detailed story about Bruesewitz v. Wyeth — a SCOTUS decision that recently upheld the federal law that preempts design defect suits against vaccine manufacturers, instead channeling the complaints into a Vaccine Court that awards damages from an industry-sponsored fund.

3. The Healthcare Economist has a review of a Robert Wood Johnson article on the ACA’s various Value-Based Purchasing provisions.

4. Bradley Herring at the NEJM has a an economic perspective on the individual mandate’s severability from the ACA.

5. The Wall Street Journal has a piece about governors’ struggle with Medicaid budgets, and the strategies they are implementing to deal with ballooning costs.

Navigating Vaccine Policy in New Jersey

[Ed Note: This article was originally published in print and online by The Record, New Jersey's most awarded newspaper.]

NEW JERSEY’S immunization law attempts to strike a balance between protecting public health and the accommodation of religious observance. Children must be vaccinated as a condition of school attendance, but the requirement is waived if the vaccination “interferes with the free exercise of the pupil’s religious rights.”

Last summer, the Department of Health and Senior Services amended its regulations to simplify the process for obtaining this exemption. Several legislators, pointing to New Jersey’s drop in childhood immunization rates, have filed a resolution to force the withdrawal or amendment of this relaxed standard.

Emotions on this topic run high. New Jersey can, however, craft a policy that protects the public health while accommodating those who feel most passionately about avoiding childhood vaccinations.

Under such a policy, permissible exemptions could fall into three categories: medical exemptions for children with conditions, such as immune disorders, that render vaccinations inappropriate (the department estimates that about 0.2 percent of children fit this category last year); exemptions for those with genuine religious reasons to refuse vaccinations (the department estimates that about 0.8 percent of children fit this category last year), and exemptions for those who categorically oppose vaccines on non-religious principles. The first two categories combined amount to only 1 percent of children.

Fueling fears

It is, then, growth in the size of the final category that fuels fears that childhood immunizations could drop to levels threatening population health. The adoption of two practical steps can allay those fears.

First, some factual background. New Jersey’s immunization rates have been dropping. The department’s figures show that the rate of children under 3 with complete age-appropriate vaccinations has dropped from about 80.5 percent in 2007 to about 67.2 percent in 2009. The drop is significant, and may pose a threat to our “herd immunity” - the level of population vaccination necessary to block outbreaks of infectious diseases.

Public health officials recommend vaccine levels at least in the mid-80 percent to low-90 percent level to protect “herd immunity.” This is important stuff: children who are not immunized because they’re too young or medically compromised are at risk if overall rates drop to unsafe level.

Routine vaccinations are safe

Almost all medical and public health experts believe that routine vaccinations are safe and appropriate for almost all children. Even so, we can reach safe levels of childhood immunizations while respecting the strongly felt contrary views of vaccine deniers. Two steps are necessary.

1) Primary care focus. The American Academy of Family Physicians has encouraged primary care providers to remind parents of immunization schedules, provide accurate vaccine education and open their scheduling to encourage primary care visits.

Here in New Jersey, Summit Medical Group has reported that such programs raised its patients’ childhood immunization rates from 84 percent to 97 percent from 2008 to 2010. If primary care providers focus on the reminders, education and open scheduling that achieve such dramatic level of improvement, we’re mostly there.

Restricting exemptions

2) Tightened process for non-medical exemptions. This step is more controversial. Let’s be candid and admit that religious exemptions are sometimes employed by those with strong non-religious objections to vaccinations.

Further, let’s admit that it is uncomfortable for the state to pass judgment on the sincerity of claims of sincere religious belief. A 2001 study published in the American Journal of Public Health provides a way out of this conflict.

It found that non-medical vaccine exemptions can be minimized when states take minor steps as requiring parents to file annually, and at that time to receive accurate information on risks and benefits of immunizations. Such processes can tip the balance toward immunization for two groups of parents.

First, parents without strong objections but for whom doctors’ appointments for vaccinations were inconvenient may find that it is now easier on balance to comply with the law. Second, those confused by the controversy may have their fears addressed by public health information provided.

The article found that these simple steps can increase the level of immunization, while respecting the views of those parents with implacable objections to vaccinations. Objecting parents can simply accept the information, and file the annual reports.

These two steps could raise immunizations to safe levels without the need to force the hands of parents with strong religious or other principled objections. If, as the studies suggest, vehement objectors are relatively few, population health and personal beliefs can be accommodated.

Reform Rodeo

1. Medicaid in Arizona: Kevin Sack of the New York Times discusses Arizona’s planned removal of  a quarter of a million Medicaid patients from their rolls; Secretary Sebelius has signed off.

2. Essential Benefits: Ian Spatz at the Health Affairs Blog continues the discussion of the controversial determination of essential benefits under the health reform statute.

3. Integration and Prices: Maggie Mahar at Health Beat has a piece on the concern about price increases due to integration by accountable care organizations and other similar entities.

4. Clinical Practice Guidelines: David Williams at KevinMD.com details a recent survey which appeared to find more public support for arguments against treatment guidelines as opposed to arguments in favor of the guidelines.

5. Individual Mandate: Bob Laszewski at Health Care Policy and Marketplace Review posits alternatives to the individual mandate.

High School Just Says No to Medical Marijuana

Remember the “Just Say No” and D.A.R.E. anti-drug campaigns way back in the day?  I do.  That’s when the high school kids would come to my elementary school, put on a play, and divide us into small groups for a talk on how we shouldn’t use drugs.  I think there was even a song in there somewhere.  Remember those bizarre zero-tolerance policy stories too?  The ones about a middle school student who was suspended for touching and refusing a proffered Adderall pill or a little kid who was suspended for bringing a camping utensil to school and then required to attend an alternative school for 45 days?

So what should parents and teachers do when a high school student may legally take medical marijuana lozenges to treat diaphragmatic and axial myoclonus, a rare condition which causes him to suffer seizures that can last for 24 hours, but may not legally do so when the seizures occur at school?  As The Colorado Independent reports, that’s the question facing a Colorado Springs teenager who needs to take such lozenges for seizures that can happen without warning and a high school that doesn’t want him to have the lozenges on its property.

You see, 15 states - Alaska, Arizona, California, Colorado, Hawaii, Maine, Michigan, Montana, Nevada, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, and Washington — and the District of Columbia have legalized medical marijuana.  Nine states — Connecticut, Delaware, Idaho, Illinois, Maryland, Mississippi, New Hampshire, New York, and Oklahoma — have similar legislation pending.  In November 2000, 54% of Colorado voters approved the legalization of medical marijuana through Ballot Amendment 20.  The law went into effect on June 1, 2001.  (Nine years later, Governor Bill Ritter signed House Bill 1284 and Senate Bill 109 into law, providing a regulatory framework for dispensaries and addressing potential fraud and abuse.)

The Colorado Department of Public Health and Environment (CDPHE) maintains the Medical Marijuana Registry program which accepts and processes applications for Registry Identification cards.  The registration process is fairly straightforward.  Under 5 CCR 1006-2, an adult patient/applicant (over the age of 18) must submit a notarized application which includes name, address, date of birth, Social Security number, name and address of primary-care giver (if applicable), written documentation from the applicant’s physician confirming his or her debilitating medical condition, name and address of the applicant’s physician, and a copy of an identity document.  For a minor patient/applicant (under the age of 18), a parent residing in Colorado must submit written consent and the applicant’s name, address, date of birth, Social Security number, written documentation from two of the applicant’s physicians confirming his or her debilitating medical condition, the name and address of the two physicians, consent from the applicant’s parents residing in Colorado, and documentation from one of the physicians about the risks/benefits of the medical marijuana treatment.

In June 2010, CDPHE reported that 95,477 Coloradan patients possess valid Registry Identification cards… and only 24 of those patients — a mere 0.0251%  — are minors.  However, if you read the fine print in C.R.S.A. § 25-1.5-106(12)(B)(IV), you’ll note that “[a] patient or primary caregiver shall not: possess medical marijuana or otherwise engage in the use of medical marijuana in or on the grounds of a school or in a school bus.”  What should minors do if they’re still in school and need to take their medicine?

So maybe the Colorado Springs high school isn’t without reason for prohibiting this student from bringing his lozenges onto its property.  It’s an oversight on the part of the legislature to be sure and I wonder if any of the other 23 registered minors have experienced similar problems.  The obvious compromise would be to allow the student to go home and take his medicine as needed — The Colorado Independent reports that he switched schools last year to be closer to home for this very reason — and then return to school.  Yet until this past week the school told the student that this wasn’t an option.  Besides, it’s not a wholly satisfactory compromise if the student has to walk home while having a seizure.

Medicaid Targeted as States Cut Budgets

On January 21, Arizona passed legislation allowing the state to submit a Medicaid-waiver request to cut 280,000 people from the program next year.  When filed, it became the first official request to suspend PPACA’s “maintenance-of-effort” provision.  The mandate requires states to maintain early 2010 Medicaid eligibility levels until the 2014 nationwide expansion of eligibility.  Arizona could lose its entire federal Medicaid contribution, approximately $3 billion, if it fails to meet the maintenance-of-effort provision.

The Associated Press reports that most Arizonans who lose coverage are “non-pregnant, non-disabled, childless adults and also parents with incomes above 50 percent of the federal poverty level.”  According to the Arizona Republic, however:

Though the cuts have been billed as affecting only childless adults, about 30,000 of those who would lose coverage are parents and another 11,000 are children.

Read more

Jonathan Blum, CMS Deputy Adminstrator, Speaks on ACOs

We’re waiting for the Department of Health and Human Services to release proposed regulations on Accountable Care Organizations.  This site has previously discussed the potential good and bad of ACOS (see here, here, and here).   I attended a conference last week at which an innovative model of “Medicaid ACO” was discussed.  The Medicaid ACO would be authorized in New Jersey under a bill pending before the NJ Legislature.  It is an exciting idea that will attempt to reach the poor and vulnerable who often lose out in health reform programs.  The godfather of the Medicaid ACO project is Jeff Brenner, about whom Atu Gawande recently wrote in the New Yorker.   (subscription required)    I’ll be blogging about the New Jersey bill in a future post.  The conference was funded by the Nicholson Foundation and presented  by the Health Care Quality Institute.

Speaking at the conference was Jonathan Blum, Deputy Administrator and Director of the Center for Medicare at CMS.  In discussing “Accountable Care Organizations and the Affordable Care Act,” Blum was in the difficult position of speaking about a topic of great interest, while not being able to discuss the contents of draft regulations that are no doubt nearing completion. Nevertheless, he made some interesting points that I’ll pass along.

Blum’s talk focused on policy positions that are driving HHS as it drafts the regulations.  The overriding policy positions he described included:

• The ACO regulations will not be “one size fits all.” He emphasized that CMS will be looking for innovative models, with different payment systems, and with different “on ramps” to formation and approval. He emphasized that CMS is interested in models that serve “safety net populations,” as CMS wants to ensure that the poor and underserved get the same opportunities as “suburban” folks. The primacy (at least in order of presentation) was welcomed by the NJ folks, whose model is directed to Medicaid recipients.
• The orientation, consistent with much of the ACO literature, is “patient first.” He distinguished this orientation from one that would see ACOs as a means for powerful interests to gain market share. That tension is, of course, evident in the ACA’s ACO provisions, as has been pointed out most eloquently by Tim Greaney. Blum described CMS as being focused on care systems’ sensitivity to patient and family concerns, and with payment programs oriented to health care “journeys” and not episodes.
• Clinical quality is key. CMS will focus on outcomes measurements “much more” than in the past. It will be interested in particular in quality measurements and patient experience.
• He spent a fair amount of time emphasizing that CMS does not regard the ACO program as static. CMS will constantly review payment and quality issues, with an eye toward updating oversight and program requirements. It will use payment incentives to drive quality improvements. He indicated that there is some tension between CMS’s interest in having quality be data-driven in ACOs with its insistence on protecting patient confidentiality and privacy issues. CMS is interested in encouraging patient advocacy efforts to support continued emphasis on patient privacy and confidentiality.
• In response to a question, Blum recognized the substantial tension between the ACO model’s emphasis on improving quality and reducing cost through organization of care on one hand, and the ACA’s continued embrace of patient choice of provider on the other. He indicated that this tension might best be addressed by ACOs and their constituent providers creating a sufficiently attractive delivery model that patients will want to be involved — exclusively. (Reaching this goal would clearly require unprecedented patient education efforts.)

The Q & A following Blum’s presentation was predictably frustrating on both sides, as could be anticipated in connection with a talk about not-yet-finalized regulations.  He recognized several outstanding issues that he was not at liberty to discuss, but which had been occupying those drafting the regulations, including:

• Will physicians be able to join more than one ACO? CMS is apparently considering different rules for primary care physicians and specialists, although Blum acknowledged that such overlapping provider networks will make the computation of “gain” difficult when gainsharing is implemented.
• Blum, although asked, would not bite on the question of “who will lead” (physicians or hospitals). He anticipates a variety of models, but stressed that no ACO would flourish without physician buy-in.
• The question of geographic exclusivity for ACOs engendered a similarly noncommittal response. Blum acknowledged the conceptual difficulties presented by such overlap, but also pointed to the negative implications of exclusivity on the robustness of competition.

So, it was an interesting discussion of general principles, whetting our appetites to see how HHS will “square the circle” — or circles — in the upcoming regulations.

The Center for Health & Pharmaceutical Law & Policy Presents Dr. Poonam Alaigh, New Jersey Commissioner of Health & Senior Services

Tuesday, March 1, 2011

Donate a Kidney and Get Out of Jail

I can’t read another paean to Mississippi Gov. Haley Barbour for granting a release from imprisonment to Gladys Scott on condition that she “donate” a kidney to her sister.

The Scott sisters were sentenced to life 16 years ago for an armed robbery that yielded them $11. The women will be eligible for parole in 2014.

Civil rights advocates have sought the two women’s release for some years, arguing that their sentences were excessive.

Barbour’s decision has been hailed by the NAACP President and CEO as “a shining example of the way a governor should use the power of clemency.” A primary reason cited by Barbour for his decision is that sister Jamie’s dialysis is costing the state a lot of money. According to Gladys Scott’s attorney, the idea that she donate a kidney to her sister was her own, which is why he included it in the petition for release.

While available reports do not provide sufficient facts for robust legal-moral analysis, this story raises issues that should give us pause.

First and foremost, I am concerned on Gladys Scott’s behalf that a kidney donation is in neither her short- or long-term best interests - I can only wonder whether her own health makes her an ideal donor after serving a 16-year prison sentence.

We don’t know what led to Jamie’s end-stage renal disease, but it is crucial that Gladys know what her own risk for the disease is before she gives up a healthy kidney. Will her physicians feel comfortable recommending against the surgery if her long-term prognosis is poor - would such a decision result in the revocation of the prison release, or is the release contingent upon a medical “OK” for the procedure?

Compromise

To what extent will the transplant physicians be required to compromise their own ethical duties to the health of these women to accommodate their desire for freedom?

Hopefully, Barbour’s release decision depends upon Gladys’ willingness to be considered as an organ donor, as opposed to her having to actually go through with it.

While I believe it possible that Gladys wishes to donate her kidney to save her sister’s life, the conditions under which she has made this decision are hardly ideal to voluntariness, which our law normally dictates is a necessary condition precedent to organ donation.

These women have been incarcerated their entire adult lives, and have likely made very few decisions on their own behalf, much less life-and-death ones.

Other doubts haunt this scenario. If indeed the Scott sisters merited a suspension of their sentences because they are excessive, then the governor should have made his decision for that reason, thereby enabling the women to resolve how to proceed in addressing Jamie’s kidney failure in the context of their private lives, without state compulsion and outside the glare of the media.

I hope they have significant and stable support upon their release - in addition to undergoing a significant medical procedure, they may not be well-prepared for successful reentry even in the best of circumstances.

Barbour cites the opportunity to save the state health costs by releasing the sisters to pursue the transplant. If the transplant is both a cost-effective and humane alternative to dialysis (which I believe it is) why wasn’t it allowed during the sisters’ incarceration?

While the state may be expecting to save money for the sisters’ health care, it is presumably Medicare that will be covering the cost of the transplant and the extremely expensive post-surgical anti-rejection drugs that Jamie will require (although Jamie’s eligibility for Medicare will likely be fraught with hurdles).

Thus, a large part of the state’s motivation here seems to be the chance to shift Scott from the state’s Medicaid roll to the federal government’s Medicare program.

A fragmented system

While this might work out in the end for the Scott sisters, it represents yet another perversity of our fragmented health care system.

The Scott sisters must be wonderfully excited about their imminent release, and the possibility of saving Jamie’s life, and I am pleased for them.

I am less excited, however, about Barbour’s decision becoming a precedent for other governors.

This article originally appeared in The Record, New Jersey’s most awarded newspaper.

The Boys Are Back In Town… But Will They Have Much Repeal?

A week before the election, the  L.A. Times quoted Senator Orrin Hatch (R-Utah) as saying his party “could come up with a healthcare system that American people would not only be proud of, but would actually love.”  That same article reported how Republican and other conservative candidates have been promising to repeal the Patient Protection and Affordable Care Act (PPACA) without proposing a viable alternative.  In fact, the Republican track record for the past decade isn’t anything to trumpet.  Rather than lowering healthcare costs and expanding access to care,

from President George W. Bush’s election in 2000 to the end of GOP congressional majorities in 2006, Republicans failed to pass major healthcare changes despite evidence of an escalating crisis.

American workers saw their health insurance premiums jump 78%, as the average price tag for an employer-provided family health plan surged to $11,480 a year, according to a survey of employer health benefits by the nonprofit Kaiser Family Foundation and the Health Research & Educational Trust.

That took a toll on businesses and employees. In 2000, 69% of employers provided their workers with health benefits, the Kaiser surveys found. In 2006, 61% were offering health insurance.

By the time Republicans lost control of Congress, an estimated 43.6 million Americans did not have health insurance, up from 41.3 million six years before.

Be that as it may.  The election has taken place, the Republicans have regained control of the House, and the country is left to wonder: are the days of PPACA — or any kind of healthcare reform — numbered?  The Washington Post observes that election day “[e]xit polls showed… roughly half the public wants to repeal the bill but that the other half wants to keep or expand it, setting the stage for a potential showdown.”  Prescriptions, a N.Y. Times health blog, interviewed a a portfolio manager and health care strategist, and found that he “‘[didn't] think anybody wants to kiss off 30 million new customers’….  What the health insurers and drug and device makers want is not repeal, he argued, but ‘reform light.’”

Granted, the Democrats still control the Senate, a Democratic president remains in office for at least two more years, and the Republicans didn’t win enough seats to override a presidential veto.  So if an outright repeal isn’t in the cards, then what other options do the Republicans have to scale back this “monstrosity,” to borrow the colorful phrase used by incoming House Speaker and Minority Leader John Boehner (R-Ohio)?

The N.Y. Times suggests that Republicans might direct Congress to chip away at or eliminate the less popular PPACA provisions, such as the tax on manufacturers of medical devices, the requirement for many employers to contribute to insurance for employees, or the mandate that everyone have health insurance.  The article notes that

with Republicans winning control of many governors’ mansions and making gains at the state legislative level, they will be able to determine how the new law is carried out locally.

Republicans in Congress said they would try to give states more latitude and discretion on issues like the design of health insurance exchanges. The law calls for creation of an exchange in each state and says only government-approved insurance plans can be sold on the exchange.

The new rules, though stricter than in the past, may well be less stringent than they would have been if Democrats had not taken what Mr. Obama described as “a shellacking.” In addition, Republicans said they would try to cut the budget for federal enforcement of the law and related rules.

On Wednesday, Rep. Boehner expressed his belief that “the health care bill will kill jobs in America, ruin the best health care system in the world and bankrupt our country.”  In response to these claims, Kaiser Health News asked 3 dozen people across the country,  including physicians, CEOs and Presidents, administrators: ”[i]f you ended up in an elevator with Rep. Boehner, what single thing would you urge him to do about health care in this country?”  (Click here to read their responses.)  I’d urge him to repeal his stance.

Election Fallout and Why State Initiatives to Exempt Residents from Health Care Law are Not Just Symbolic

As the election results filter in and America finds itself trying on some level to read tea leaves, analysts and pollsters are hard at work trying to get a sense of why things fell out the way they did. Most pertinent to this blog, of course, is just what kind of role the health care law played in these elections. The Wall Street Journal’s Health Blog writes:

Official exit polls put health care as the second-most important issue driving votes, with 19% of those surveyed by Edison Research (for media organizations) saying it was their key issue, Politico reports. That paled, however, to the 62% who said the economy was most important.

Time Magazine’s Swampland Blog has a quick and effective breakdown of the health reform impact on a number of candidates. Entitled “Mixed Results on the Health  Reform Referendum,” you can find that here.

I have, however, issue with one aspect of the Time piece. It states:

Voters in Arizona, Colorado and Oklahoma also had a chance to weigh in on symbolic ballot initiatives to amend their state constitutions to exempts residents from portions of the Affordable Care Act. These are symbolic because federal law trumps state law — the point of the initiatives is basically to send a message of opposition. Oklahoma voters resoundingly approved their measure. (Missouri voters acted similarly in August.) It’s still early, but Colorado voters look like they are more split, with 55% of voter voting against the measure with 24% of precincts reporting. In Arizona, even fewer votes have been tallied — the count stands at 56% approving the measure with 14% of precincts reporting. (emphasis added).

I do not discount that these initiatives have symbolic value, but as I’ve noted before on this blog, such initiatives are not wholly symbolic. When the AMA’s Amed News wrote a similar story regarding the similar Missouri initiative, I noted that a federal judge in Virginia found standing in a challenge against the health care law based upon just such an initiative. I wrote:

Generalities aside, as is best in this regard, it strikes me that the Missouri initiative may have more than just symbolic value. Importantly, in the recent federal court decision regarding Virginia’s suit against the individual mandate, the judge in that case found standing for the state of Virginia–an exceedingly important, though procedural, ruling. It is exceedingly important because without standing the case could simply not go forward. The judge in the case found standing for Virginia’s 10th Amendment claim largely based upon a law passed subsequent by the state of Virginia. Regarding that matter I wrote:

In deciding the standing issue, Judge Hudson, according to Professor Jack Balkin, made much of the “Virginia Health Care Freedom Act– which asserts that no Virgina citizen may be forced to purchase health care insurance; that this law conflicts with the federal Affordable Care Act, and therefore Virginia has standing to challenge the act under the 10th amendment.”

Virginia’s Act was passed subsequent to the federal law in question; other states challenging the individual mandate do not, at present, have such a law to rely on. As Professor Balkin points out, however, the Virginia Act being deemed sufficient to buttress standing in a States’ rights Tenth Amendment claim is interesting– to say the least. It begs the question.

In more than just symbolic terms, Missouri may have just answered that question–at least in terms of 10^th Amendment standing–if, of course, its federal district court sees the matter in the same way as did Judge Hudson. Certainly not guaranteed– the Missouri Federal Court is not bound by the Federal Court of Virginia– but nonetheless, Missourian’s just laid claim to an argument that has won elsewhere.

Arizona, Colorado and Oklahoma may have just done the same.

New Jersey’s Long-Awaited (and Controversial) Proposed Medicinal Marijuana Program Rules

Last week, New Jersey’s Department of Health and Senior Services released long-awaited proposed regulations implementing The Compassionate Use Medicinal Marijuana Act and they have already proved controversial.  Generating the most debate is the Department’s determination that the entities authorized to grow marijuana will not be authorized to dispense it to patients and vice versa.  As the Department explained in a press release, “[s]ix Alternative Treatment Centers (ATCs) will be selected through a competitive process.  Two of the ATCs will be cultivators and four will be dispensaries. … The ATCs selected for dispensing medicinal marijuana will also have the ability to apply to the Department for satellite locations in their region.”

According to the New Jersey Law Journal, Assemblyman Reed Gusciora (D-Mercer), one of the Act’s primary sponsors, called the regulations “a departure from the legislative intent” to authorize six ATCs — two each in northern, central, and southern New Jersey — all of which would both grow and dispense medical marijuana.  Senator Nicholas Scutari (D-Union), another primary sponsor, agrees, arguing that: “the regulations are a problem.  I’m not happy because they do not comport with the statute.  It’s insulting and agitating.”  The Law Journal reports that “Scutari and Gusciora say they will try to persuade [DHSS Commissioner Poonam] Alaigh to change the regulations to conform to the statute.  ‘You can’t change a statute through the regulatory process,’ says Scutari, adding that he will pursue changes through litigation if the rules are not amended to the Legislature’s satisfaction.”

A careful reading of the Act reveals that the provision addressing the function of ATCs is less than crystal clear, however:

“An alternative treatment center shall be authorized to acquire a reasonable initial and ongoing inventory, as determined by the department, of marijuana seeds or seedlings and paraphernalia, possess, cultivate, grow, harvest, process, display, manufacture, deliver, transfer, transport, distribute, supply, sell, or dispense marijuana, or related supplies to qualifying patients or their primary caregivers[.]”

The Department obviously reads this in the disjunctive, to mean that ATCs shall be authorized to do (at least) one of the things listed, but need not be authorized to do all of them.  This reading is supported by the “or” between “sell” and “dispense.”  On the other hand, reading the sentence in the disjunctive allows for absurd results that clearly would thwart the Legislature’s intent.   (For example, under this reading, the Department would be within its rights to authorize six ATCs to grow marijuana but none to dispense it.)

Leaving further statutory analysis to others, I will say that I do not think that the Department’s decision to separate growing and dispensing will necessarily thwart the Legislature’s directive that there be “a sufficient number of alternative treatment centers throughout the State, pursuant to need, including at least two each in the northern, central, and southern regions of the State,” particularly given that the regulations provide for both home delivery and the possibility of satellite ATC locations.  More likely to limit access is the expense to patients, both of participating in the program ($200 for the patient, unless they qualify for Medicaid or other assistance programs, and another $200 if the patient needs a caregiver to assist with their marijuana use) and of paying for medical marijuana, which of course is not covered by any insurance plan.  The proposed regulations provide that prospective ATCs will be judged based on a number of criteria, including “ability to meet overall health needs of qualified patients”; within that rubric, the selection committee should consider prospective ATCs’ plans to make medical marijuana affordable to those who need it.

New Rules for Insurance Appeals Under PPACA

On July 22, the Obama Administration released interim final rules that allow patient appeals of health insurance coverage decisions as required under the Patient Protection and Affordable Care Act (”PPACA”) and Health Care and Education Reconciliation Act (”Reconciliation Act”).  Published by the departments of Health and Human Services, Treasury, and Labor, these rules create standards for the internal and external processes by which patients can appeal adverse benefits decisions.

Prior to these rules, coverage appeals were governed by contract and State law.  Forty-four States have created some form of external appeal process for insurance coverage decisions; however, their coverage is limited and the processes vary greatly.  Effective January 1, 2003, changes to the Employee Retirement Income Security Act of 1976 (”ERISA”) regulations provided standards for internal appeals processes.  However, these standards only apply to employer-sponsored group health insurance.

As stated in the Obama Administration fact sheet entitled, “Appealing Health Plan Decisions,”

Today, if your health plan tells you it won’t cover a treatment your doctor recommends, or it refuses to pay the bill for your child’s last trip to the emergency room, you may not know where to turn. Most health plans have a process that lets you appeal the decision within the plan through an “internal appeal” — but depending on your State’s laws and your type of coverage, there’s no guarantee that the process will be swift and objective. Moreover, if you lose your internal appeal, you may not be able to ask for an “external appeal” to an independent reviewer.

Internal Appeals Process

Under the rules, new health plans beginning on or after Sept. 23, 2010, must have an internal appeals process for beneficiaries to challenge “adverse benefits decisions” — a “denial, reduction, or termination of, or a failure to provide or make a payment (in whole or in part) for a benefit.”  Such adverse benefits decisions may be based on individual eligibility, benefit coverage, limitations on otherwise covered benefits (such as preexisting condition exclusions, source-of-injury exclusions, and network exclusions), and a determination that a benefit is experimental or not medically necessary.

In addition, health plans must do the following:

• Notify a claimant of a benefit determination as soon as possible;
• Provide claimants, free of charge, with the evidence relied upon and the rationale for the decision;
• Avoid conflicts of interest by making decisions regarding hiring, compensation, termination, and promotion independent of a claims adjustor or medical experts record of denial of benefits; and
• Meet additional requirements for notice, including information on internal appeals and external review processes.

However, these requirements do not pertain to so-called “grandfathered health plans” — those health plans that were in existence before March 23, 2010 when PPACA was enacted.  In the individual market, health insurance providers must meet the foregoing requirements as well as the following three:

• Applicants for individual insurance must be allowed to appeal initial eligibility determinations;
• Internal review must be limited to a single level, allowing claimants to appeal to external or judicial review immediately; and
• Insurers must maintain all claims and notices for a minimum of six years, which is already required of employer-sponsored health plans under ERISA.

External Appeals Process

If the internal appeal is denied, patients may choose to have the claim reviewed by an independent reviewer.   According to Appealing Health Plan Decisions, States are encouraged to adopt the National Association of Insurance Commissioners (NAIC) standards in “their external appeals laws to adopt these standards before July 1, 2011.”

The NAIC standards call for:

• External review of plan decisions to deny coverage for care based on medical necessity, appropriateness, health care setting, level of care, or effectiveness of a covered benefit.
• Clear information for consumers about their right to both internal and external appeals — both in the standard plan materials, and at the time the company denies a claim.
• Expedited access to external review in some cases — including emergency situations, or cases where their health plan did not follow the rules in the internal appeal.
• Health plans must pay the cost of the external appeal under State law, and States may not require consumers to pay more than a nominal fee.
• Review by an independent body assigned by the State. The State must also ensure that the reviewers meet certain standards, keep written records, and are not affected by conflicts of interest.
• Emergency processes for urgent claims, and a process for experimental or investigational treatment.
• Final decisions must be binding so, if the consumer wins, the health plan is expected to pay for the benefit that was previously denied.

If State laws don’t meet these standards, consumers in those States will be protected by comparable Federal external appeals standards.

As Kaiser Health News reported, “This is a regulation that benefits everyone — consumers get protections, business and providers get more certainty in the rules and the need for litigation to settle these issues should be dramatically minimized,” Phyllis Borzi, assistant secretary of the Department of Labor, said at a briefing for reporters Thursday.

Consumer Assistance Grants

However, procedural rights for consumers are not sufficient to ensure proper appeals.  “Not enough consumers know this is an option that they have,” said Angel Robinson, the consumer advocate in the Iowa Insurance Division, according to Kaiser Health News.

In addition to the new requirements for internal and external appeals processes under the interim final rules, the federal government is offering nearly $30 million in resources to States and Territories to strengthen and establish consumer assistance programs.  Specifically, these programs are charged with:

• Helping consumers enroll in health coverage;
• Helping consumers file complaints and appeals against health plans;
• Educating consumers about their rights and empowering them to take action; and
• Tracking consumer complaints to help identify problems and strengthen enforcement.

Image Credit: Appeal to the Great Spirit, Cyrus Edwin Dallin (1909) Photo by Toni To via Flickr

High Risk Pools: Then and Now

By Christine Davis

For medically uninsurable people, or people with pre-existing conditions who cannot find coverage, coverage may soon materialize.   Even before President Obama signed the PPACA, CMS had provided “Qualified High Risk Pool” grants to qualifying states, in order to cover these higher risk people since 2007.  (45 CFR Part 148)  Thirty-five states participated.  Before health care reform passed in 2010, states could qualify for operational or seed grants, which they could use to cover eligible individuals.  (Federal Register, v 73, no 81).  PPACA authorizes the development of  a temporary national high risk pool, which will operate similar to what is happening now with the state grants and will function as a temporary fix until the insurances exchanges kick in after 2014 and insurance companies are mandated to cover all individuals with pre-existing conditions. This is a unique part of the new bill because it seems to be something both Republicans and Democrats can agree on.    Previously, the majority of these state high risk pools had lifetime maximum payouts, usually around $1 million, (three states had lifetime maximums of $500,000). Once these individuals reached that amount, they had no other way to be insured. (http://www.federalgrantswire.com/seed-grants-to-states-for-qualified-highrisk-pools.html).

The goal of the national risk pool is to transition the uninsurable until health care exchanges are established in 2014.  Once that happens, there will no longer be lifetime or annual limitations on coverage.  The idea here is that an individual will never reach a point where there is absolutely nowhere else to go for coverage.

By 2014, eligible individuals will be people “who have not had creditable coverage for the previous six months and now have a pre-existing condition.”   As of now, most state pools require those seeking coverage to (a) submit proof that they have been denied coverage due to a pre-existing condition, or (b) show that they have applied recently for coverage and were a victim of “adverse underwriting actions,” such as limiting benefits or charging extraordinary premiums (for example, diabetics). (Coverage: Creating a Temporary National High Risk Pool: the New Health Dialogue Jan 12, 2010). One concern of these eligibility requirements is that they might discriminate against those who only recently lost coverage, because they are making every individual prove they have not had coverage in the past.

An advantage to a national high risk pool as opposed to a state high risk pool is that it will be more balanced and less costly, because the premiums charged won’t be as high.  Although, if annual or lifetime limits aren’t capped once these exchanges kick in, these costs could skyrocket. However, a downside is that in some states, these high risk pools have limited eligibility and low enrollment, and for example, monthly premiums costing an individual well over $1,000/month.  However, the news is not all bleak. States like Minnesota have been doing it right all along, even with broad eligibility, by finding additional streams of revenue, such as tobacco settlement funds, with which to support the pool.  In order to  be successful, the national pool, should model itself after successful states like Minnesota.

State Long-Term Care Partnership Programs

By Brian Seguin

Long-term care refers to end of life care where a person can no longer take care of themselves. These people require either the assistance of a trained professional, such as a home health aide, to help them care for themselves in their home, or they need to be housed in a nursing home and cared for there. Since Medicare does not cover long-term care, people who require it need to either pay for it themselves, or if they have almost no savings and get a low enough monthly income that they qualify, they can apply for Medicaid which does cover it. If someone pays for it themselves and winds up spending all of their savings and still needs care, they can then apply for Medicaid to cover it if their monthly income is under the threshold set by their state in order to qualify for the program.

In the early 1980’s, states began to worry that as the baby boomer generation got closer to retirement age and might start requiring long-term care, it could cause increases in their Medicaid expenditures and thus budget deficits. One possible solution forwarded for this impending problem, and eventually implemented by four states in 1993, was the idea of state long-term care partnership programs. Under these programs states would incentivize their citizens to purchase private health insurance to cover at least part of the long-term care they may eventually require and thus spare Medicaid from covering some of the costs. Insurance companies who participated in the programs had to meet certain regulations of what type of care was provided and had to report certain data back to the states so they could effectively monitor the impact the programs were having.

Proponents hoped these plans would cause people to buy their own long-term care insurance coverage and hopefully never need to turn to Medicaid to pay for it. They also hoped this would stop the perceived threat of people transferring their assets (savings) to family members early in order to appear qualified for Medicaid. Of the four original states, California and Connecticut incentivized their citizens by allowing them to disregard assets they had above the threshold allowed to qualify for Medicaid in the amount that the partnership plan had paid towards their long-term care. In other words if a person purchased a partnership plan and it paid out $200,000 towards their long-term care, that person would still qualify for Medicaid even if they had up to $200,000 in assets over the amount usually allowed to qualify. This was called the “dollar for dollar approach.” New York required citizens to purchase more comprehensive plans that had higher lifetime benefits, and if they did they could disregard all of their assets in determining if they qualified for Medicaid, known as the “total assets approach.” Indiana allowed a “dollar for dollar” disregard if the person purchased a plan covering less than four years of care and a “total asset” disregard if they purchased a plan covering more than four years.

Opponents of this idea worried that these public partnerships would inappropriately promote private plans with limited values, and that they could lead to increases in Medicaid expenditures by allowing wealthier people who would purchase private long-term care plans anyway keep their assets and now have access to Medicaid that they wouldn’t have otherwise had. As a result of these fears part of the Omnibus Budget Reconciliation Act of 1993 (OBRA) required any state that started a partnership program after 1993 to recover any disregarded assets of a deceased Medicaid recipient from their estate. Although this Federal law did not apply to the four states already operating partnership programs and did not ban other states from starting their own programs, it effectively eliminated any other states from trying to start their own programs by removing the incentives for citizens to join. This is because although a person could keep some of their assets while still alive, and still qualify for Medicaid, the state would now have to take those assets from their estate. So there was no longer any incentive for a person to purchase a partnership plan which they may never need, and thus shift some of the potential costs of long-term care on private insurers rather than Medicaid.

The Federal government finally decided to give long-term care partnership programs another chance in 2005 with the passage of the Deficit Reduction Act (DRA). Parts of that bill removed the estate recovery requirement of OBRA and allowed states (other than the original four who have continued their programs and are again not subject to this bill) to start their own partnership programs provided they use the “dollar for dollar” approach. Insurance companies participating in these new programs will have to be certified by the state, using new federal guidelines, and will have specific data reporting requirements. The “dollar for dollar” approach is mandated to avoid the grant of Medicaid benefits to those who do not need or deserve them. This approach only allows beneficiaries to keep the amount of assets they would have presumably spent for long-term care themselves and then qualified for Medicaid anyway, had their partnership plans not paid that amount. The federal government has finalized its rule of what data needs to be submitted by partnership insurers after consulting with the National Association of Insurance Companies, insurance companies who issue long-term care plans, the four original states with programs, and consumers who purchase long-term care plans. The data collected is meant to cost insurers as little as possible while still allowing the federal government to accurately track the effectiveness of these programs. While no states or private insurers are required to participate in these partnership programs, as of August 2008, 13 states (in addition to the original four) are now offering partnership plans and 12 more are in the process of implementing them.

New Jersey Medical Marijuana Legislation Update: Poised to Pass?

Supporters are hopeful that before Governor-Elect Chris Christie takes office next month, the New Jersey legislature will pass — and current Governor Jon Corzine will sign — medical marijuana legislation.  In February 2009, the “New Jersey Compassionate Use Medical Marijuana Act,” which would allow patients suffering from “debilitating medical conditions” to treat their symptoms with marijuana without fear of state criminal reprisals, passed the state Senate.

In June 2009, Seton Hall Law’s Center for Health & Pharmaceutical Law & Policy issued a position paper calling on the full legislature to pass the Act, arguing that it would “allow New Jersey residents with debilitating medical conditions access to marijuana to ease their suffering without creating an undue risk of abuse or diversion.”  Soon thereafter, the Act cleared the Assembly Health, Human Services and Senior Citizens Committee, albeit with a number of amendments, including several bolstering the Act’s already strict safeguards against abuse and diversion.  (For a detailed summary of the differences between the Senate and Assembly versions of the Act, see below.)

According to an article in the New Jersey Law Journal, a legislative aide “says they are trying to get the [Act] posted for a floor vote on Dec. 7, Jan. 7 or Jan. 11, the remaining voting sessions in the current term.  The Assembly is expected to pass it.”  Due to the amendments added by the Assembly Committee, the Senate would need to pass the Act again before it would reach the Governor’s desk.  Even if the Act is not passed during the current lame-duck session, however, there is hope for its passage in sessions to come. Governor-Elect Christie has indicated that, with sufficient restrictions in place, “he would be supportive of such legislation.”

Summary of Differences between Assembly and Senate Versions

Change to definition of “bona fide physician-patient relationship.”

The Senate’s version of the Act (S119) requires that patients who wish to use medical marijuana obtain a “written certification” from a physician with whom they have a “bona fide physician-patient relationship.”  Such a relationship is said to exist whenever a physician has completed a full assessment, including a physical examination, of a patient.  The Assembly’s version (A804) includes a significantly narrower definition, providing that only the physician with “ongoing primary responsibility” for treating a patient’s “debilitating medical condition” can approve that patient to use marijuana.  Such a physician must be “board-certified, if available” in the specialty appropriate for caring for the condition which qualifies the patient to use marijuana.

Changes to list of eligible “debilitating medical conditions.”

• Whereas S119 would have granted eligibility for marijuana to patients suffering from “severe and persistent muscle spasms, including, but not limited to, those characteristic of multiple sclerosis or Crohn’s disease,” A804 limits eligibility to those with “intractable skeletal muscular spasticity,” which would, it would seem, include some patients with multiple sclerosis, but exclude those with Crohn’s disease.
• Whereas S119 made all patients with cachexia or wasting syndrome, severe nausea, or severe or chronic pain eligible, under A804 patients with those conditions are only eligible if their symptoms are the result of AIDS or cancer. Concomitantly, neither AIDS nor non-terminal cancer render a patient eligible unless they cause cachexia or wasting syndrome, severe nausea, or severe or chronic pain.
• A804 adds to the list of those eligible for marijuana, patients suffering from amyotrophic lateral sclerosis and multiple sclerosis. Patients with cancer that is “terminal” and glaucoma that is “resistant to conventional therapy” are also eligible; under S119 all cancer and glaucoma patients were eligible.
• Notably, both versions include a provision allowing for additional medical conditions to be added by regulation.

Changes to rules governing “medical marijuana alternative treatment centers.”

Under A804, eligible patients will no longer be permitted to grow marijuana.  The statute’s protection will only apply to patients who obtain marijuana from New Jersey Department of Health and Senior Services-approved “medical marijuana alternative treatment centers.”  A804 adds as a requirement of approval that such centers be operated on a nonprofit basis.  They do not have to be recognized as such by the IRS but they do need to comply with all state nonprofit laws.  Perhaps in an effort to mitigate hardship that might arise as a result of these, more restrictive, provisions, A804 exhorts DHSS to “seek to ensure the availability of alternative treatment centers throughout the State, including, to the maximum extent practicable, at least two each in the northern, central, and southern regions of the State.”

Other potentially-significant changes.

• Unlike S119, A804 does not protect patients and others from arrest or prosecution; its protection is limited to waiver of applicable “civil or administrative penalties.”
• A804 also eliminates protection for caregivers who assist patients with medical marijuana use. Instead, it provides that “[t]he commissioner shall adopt regulations to: (1) provide for the use by a registered qualifying patient of a designated individual in an emergency situation to transport marijuana to the patient who is otherwise unable to obtain marijuana from an alternative treatment center[.]“

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