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Mid-Term Elections Update

Mid-Term Elections Update

by Christoper E. Condeluci, Principal and sole shareholder of CC Law & Policy PLLC in Washington, D.C.


“Implications” of Election Outcomes?

  1. As you know, I am the type of person who tries to avoid “the politics” associated with a specific issue. Instead, I focus my time on “the policy” and “the implications.” When it comes to elections, however, it’s pure “politics.” BUT here, I still do not necessarily have to talk about “the politics.” Instead, I can parrot what the political analysts and pollsters are saying about possible election outcomes. And then, I can opine on “the implications” of specific election outcomes, whichever they may be. Let me start with the potential election outcomes for the House of Representatives:


  1. Analysis: To date, almost every political analyst and pollster are guesstimating that the Republicans will take back the majority in the House on Nov. 8th. The biggest open question is: How large will the House Republican majority end up being? This question of “the size” of the House Republican majority has its own “implications.” If, for example, Republicans only hold a slim majority – say only 10 seats – it will make it that much harder for the new Republican Speaker (likely Cong. McCarthy (R-CA)) to develop and pass legislation. This is because the new Speaker will have to deal with certain factions within the Republican Conference that have a particular “agenda” that differs with the Speaker and the majority of the Conference.  We’ve seen this happen before when a group of conservative Republicans made it difficult for then-Speaker Boehner – and later – then-Speaker Ryan to get some Republican priorities through the House. Will we see a redux in 2023 and 2024?  Maybe… BUT, irrespective of whether the new Speaker can “roll” those dissenters in the Speaker’s own party, the most important “implications” of a House Republican majority is that we will have SPLIT government, which means that President Biden and Congressional Democrats will NO LONGER be able to pursue virtually ALL of the priorities they have pursued over the last 2 years. This ALSO means that NOT much is going to get done legislatively in 2023 and 2024 because President Biden holds the veto pen. BUT, get ready for the Biden Administration to churn out regulations and guidance promoting and implementing Democratic policy priorities. THEN, get ready for lawsuits filed by Republican Attorneys General challenging the Biden Administration’s regulations and guidance. Last comment: The Senate may or may not flip Republican on Nov. 8th. If the Senate flips, it does NOT change anything I said above (i.e., NOT much will happen legislatively because President Biden will pull out the veto pen, and the Administration will still use their pen to write regs and guidance). The biggest “implications” of a Republican Senate (and House) is that Leadership will work hard to lay the groundwork for not only holding on to their Congressional majorities in 2024, but also winning back the White House. That equates to a lot “messaging” bills, but also some bi-partisanship to show the American public that Republicans did NOT run a “do-nothing Congress.”


Health Care Policy Update

Public Health Emergency (PHE) Extension and End Date?

  1. Although I have spoken about “the implications” of the end of the PHE in prior updates (where I explained that double-digit millions of current Medicaid beneficiaries will lose their Medicaid eligibility upon an eligibility “re-determination”), I wanted take a moment to briefly talk about the PHE’s mid-October deadline and guesstimate that the PHE will come to an END mid-January 2023.


  1. Analysis: During a recent 60 Minutes interview, President Biden exclaimed: “The Pandemic is over.” In subsequent days, HHS Secretary Becerra said: “We still have a problem with COVID. We’re still doing a lot of work on it.  But the pandemic is over.” This prompted questions – especially from States – on whether and when the PHE might end. An HHS spokesperson responded: “The COVID PHE remains in effect and HHS will provide a 60-day notice to States before any possible termination or expiration.” This latter statement is something that we already knew, based on a more formal communication from HHS to States, informing States that they would be given 60-days advance notice of any announcement to end the PHE. So where do things stand now? The PHE is currently scheduled to last through mid-October, and since we did NOT hear an announcement of the end of the PHE back in mid-August (which marked the 60th day prior to mid-October ending date), we all NOW know that the PHE will be extended yet again – through mid-January 2023. BUT, will the PHE end mid-January 2023?  I believe the answer is YES. The speculation here is that the November mid-term elections will be over (as stated above, the elections will be held on Nov. 8th), and “the politics” associated with ending the PHE will not be as concerning to the White House as if an announcement to end the PHE came mid-August. In addition, messaging that the “Pandemic Is Over” months before mid-November essentially is providing States with even more advanced notice that the PHE will be ending, which is something that States, Exchange Leaders, and other ACA supporters have been asking for, as everyone continues to prepare for the Medicaid “redetermination” process. And for these reasons, my bet is that the PHE will NOT be extended past mid-January 2023, with notice to the States coming in mid-November. The timing of a mid-November announcement also makes sense because ACA supporters, Exchange Leaders, and those companies who specialize in enrolling consumers in subsidized Exchange plans can roll through the 2023 “Open Enrollment” (which starts Nov. 1st and generally lasts through Jan. 15th), and THEN – come Jan. 16, 2023 – start marketing to those Medicaid beneficiaries who will lose their Medicaid coverage upon a “re-determination,” informing them that a “Special Enrollment Period” will be available to enroll in a subsidized Exchange plan (with the newly “enhanced premium subsidies” thanks to the Inflation Reduction Act).


Surprise Billing Update

New Litigation?

  1. You saw my summary of the final surprise billing regs in my Sept. 1st update (see below). Most of us agreed that because the providers WON (i.e., they successfully knocked out the “rebuttable presumption standard”), NO MORE lawsuits would be filed by the providers. We did question whether the payers would file a lawsuit, but certainly NOT the providers. Well, we were wrong.


  1. Analysis: Not be outdone per their earlier success, the Texas Medical Association (who brought the initial lawsuit challenging the “rebuttable presumption standard”) filed yet ANOTHER lawsuit challenging the Aug. 19th final regulations. In this latest lawsuit, the TMA challenged the NEW standard set forth in the Aug. 19th final regs which – at least in my opinion – is EXACTLY what TMA and the providers wanted to get out of their first lawsuit. What I mean is this: In the Aug. 19th final regs, the Federal Departments ELIMINATED the “rebuttable presumption standard” and REPLACED it with a new standard that simply states:


  1. A Federal arbiter MUST consider BOTH (1) the median in-network rate (i.e., the QPA) and (2) the “credible additional information” submitted by a provider when making a final payment determination – and THEN – select the “offer” that best represents the value of the disputed medical item or service. The TMA, however, STILL thinks that this NEW standard gives TOO MUCH weight to the QPA (i.e., the median in-network rate). And soooooo, the TMA wants a court of law to strike down this NEW standard too. Look, we can all interpret statutes and regulations differently, but the way I interpret that Aug. 19th regs is that because a Federal arbiter is NO LONGER hand-cuffed to the QPA (i.e., the median in-network rate), the arbiter can give EQUAL WEIGHT to (1) the QPA and (2) the “credible additional information” and then decide whether the payer’s “offer” (which will be closest to the QPA) – OR – the provider’s “offer” (which is ALWAYs going to be higher than the QPA) best represents the value of the disputed item/service. Stated differently, I do NOT interpret the Aug. 19th regs as giving the QPA any type of priority. Heck, I actually interpret the Aug. 19th regs as giving the arbiter so much discretionary authority that I think the arbiter can simply glance at the QPA (because the statute requires the arbiter to at least look at the QPA), but give FULL WEIGHT to the “credible additional information” submitted by the provider. I think some Federal arbiters out there share my interpretation here. However, TMA contends that the Aug. 19th regs direct the arbiter to STILL give preferential treatment to the QPA. TMA goes so far as to say that:  The QPA is STILL “the lens through which all other information must be viewed.” Again, I do NOT read the regs that way, so I would suggest that TMA will LOSE on that. BUT, I have been wrong before… To me though, I think this QPA argument is a smoke-screen to what TMA and the providers are most MAD about, and that is:  The Aug. 19th final regs reminded Federal arbiters NOT to “double count” any “credible additional information” that was ALREADY factored into the value of the QPA. Here, TMA and the providers do NOT want arbiters to use their discretion and expertise to question whether the provider’s “offer” is inflated. TMA and the providers want the arbiters to take the provider’s “offer” at face value with no questions asked. Soooooo, TMA is challenging this “don’t double count” concept too. This lawsuit was just filed on Sept. 22nd, so we have a loooonnngggg ways to go before we know what’s what.  Stay tuned…


“Other Provisions” of the No Surprises Act Update

Request for Information (RFI) on the AEOB Requirement        

  1. The No Surprise Act is most well-known for the surprise medical billing protections. The No Surprises Act is not as well known for what I call the “other provisions,” which are primarily participant-friendly provisions of the law intended to increase the transparency of specific aspects of a health care episode. One such participant-friendly provision is the Advanced Explanation of Benefits (AEOB).


  1. Analysis: You have heard me talk about the AEOB in prior updates, so I won’t re-summarize it here. BUT, I will say this:  It’s exactly how it sounds. Plans/carriers MUST send certain information (similar to what is on an EOB) to a participant/policyholder if the participant/policyholder “schedules” a medical procedure/service in advance (hence A…EOB). Now here’s where things get complicated: The No Surprises Act includes a SEPARATE provision of the law which requires providers to furnish to a participant/policyholder that “schedules” a medical procedure/service in advance a “good faith estimate” (GFE) of the cost of the “scheduled” procedure/service. According to this SEPARATE provision of the law, the provider MUST ALSO send this GFE to the plan/carrier. Now back to the AEOB requirement: One of the pieces of information that a plan/carrier MUST include in the AEOB is the GFE from the provider for whom the participant/policyholder “scheduled” the medical procedure/service. Here’s the rub: If the provider CANNOT adequately and accurately send the GFE to the plan/carrier, the plan/carrier is UNABLE to include the GFE on the AEOB. This would mean that the plan/carrier either CANNOT send out the AEOB in a timely manner (because the plan/carrier does NOT have the GFE), or the plan/carrier would be sending a non-compliant AEOB if the plan/carrier sent the AEOB without waiting to receive the GFE. Man, that was a mouthful… Now back to the RFI on the AEOB requirement: The Federal Departments are struggling mightily to develop implementing guidance for (1) the provider GFE – and SEPARATELY – (2) the AEOB requirement. Soooooo, instead of releasing proposed regulations with suggested implementing requirements, the Departments are taking an interim step by asking stakeholders to provide the Departments with answers to various questions, which are intended to help the Departments develop proposed regs. In the interest of time and space, I am NOT going to list out all of the questions. BUT, I will say 2 things:


  1. First, consistent with the health care industry’s push to transfer data electronically, the Departments are interested in allowing/requiring providers and plans/carriers to transfer the GFE and also the AEOB information through Application Program Interfaces (APIs). To facilitate the secure transfer of this information, the Departments want to leverage the “interoperability” standards that have been developed as part of the MyHealthEdata Initiative and Interoperability Rule spear-headed by the Trump HHS. The RFI includes a number of questions relating to how the Departments can encourage the real-time transfer of the GFE and AEOB information through APIs. The Departments also ask about the cost associated with plans/carriers building APIs in-house and the cost of purchasing APIs from a third-party vendor.


  1. Second, there is a decent amount of OVERLAP between (1) the information that must be included in the AEOB – and also – (2) the Cost-Sharing Liability Tool required under the Transparency in Coverage (TiC) Rule. The RFI asks how these 2 requirements may be coordinated to minimize the burdens of implementing BOTH requirements. The Departments also ask if plans/carriers can leverage the work they have already put in to stand up their Cost-Sharing Liablity Tool by Jan. 1, 2023 to help with the compliance with, and the administration of, the AEOB requirement. In future updates, I may get into more detail about the AEOB RFI, but let me leave you with this: This particular RFI – plus the complication of what I explained at the top of this post – just goes to show how complex and difficult it is to even comply with the AEOB requirement. From my perspective, the AEOB requirement is/was well-intentioned. BUT, I think it should be repealed by Congress, and I think Congress should direct the Departments to spend their time and energy developing rules for how participants/policyholders can get similar information through the TiC’s Cost-Sharing Liablity Tool.


Recent Q&As on the Rx Drug Reports

  1. One of the “other provision” of the No Surprises Act is the Rx Drug Reports. You have heard me talk about this provision before as well. In my previous discussion, I explained that this Rx drug reporting requirement is MORE than just reporting Rx drug information.


  1. Analysis: For example, the Rx Drug Reports require data on “plan information” (e.g., total premiums and # of covered lives during the course of the year, and also, total medical spending during the year), as well as “Rx drug information” (e.g., among other things, total spending on Rx drugs, 50 most costly Rx drugs, top 50 Rx drugs with the greatest spending increase, and information on Rx drug rebates). As I also explained, “multiple entities” will report this information on behalf of a self-insured plan and insurance carrier. For example, TPAs for self-insured plans will report the “plan information” while PBMs will report the “Rx drug information.” On Sept. 23rd, the Federal Departments issued 6 Q&As relating to the Rx Drug Reports. BUT BTW, these Q&As talk about things that are already set forth in the Instructions that were updated on June 30th. Having said that though, let me briefly summarize what these Q&As said because obviously A LOT of stakeholders are STILL confused (otherwise, the Federal Departments would NOT have issued these Q&As).


  1. In short, the Q&As explained that if (1) a TPA is submitting the “plan information” and (2) a PBM is submitting the “Rx drug information,” the TPA and PBM should work together to complete the report on behalf of a plan. For example, the Departments explained that the TPA should fill out the “plan information” portion of the Report and then send the partially completed Report to the PBM so the PBM could fill in the “Rx drug information” (or vice versa). Then, the TPA, PBM, or a 3rd-party reporting entity can officially submit the Report on the plan’s behalf.


  1. The Q&As also said that in the event the TPA and PBM CANNOT work together (e.g., the TPA/PBM claim privacy concerns and they do NOT want to share information with each other), the Departments indicate that each respective entity can submit their portion of the Report separately on behalf of the plan.


  1. Lastly, the Q&As addressed the scenario where a plan has changed its TPA and/or PBM from one year to the other.  In this case, if the previously hired TPA/PBM is STILL reporting on the plan’s behalf, the previous TPA/PBM will include the information pertinent to the time the TPA/PBM was servicing the plan on the Report for that plan. Alternatively, the plan or the newly hired TPA/PBM must obtain the data from the previous TPA/PBM and include this information in the Report alongside the data that the newly hired TPA/PBM possesses.