Council Foundation Logo Leaders Edge

November 30, 2017

The Outlook on Tax Reform and its Insurance Implications

As the Senate inches closer to a floor vote on the Republican tax overhaul bill, it’s still unclear if the votes are there. Our dynamic government affairs duo, Joel Wood and Joel Kopperud, break it all down.

Taming the Healthcare Cost Trend

The Council recently participated in the Price of Good Health Summit co-hosted by the Council for Affordable Healthcare Coverage and American Action Forum. More than 100 health care leaders came together at the Newseum in DC for a dialogue about how to tame the healthcare cost trend. The big themes were no surprise: more transparency and better data; incentives for better-coordinated, higher value care; and more competitive health markets, and you’ll see these themes explored in Leader’s Edge magazine in the coming months. In the meantime, if you have case studies to share or companies that are making significant strides to crack these issues, please let us know so we can shine light on those examples of “making it better” out there.

  • Healthcare costs are eating us alive for a number of reasons. What many people don’t know is that costs are driving down wages, particularly at the lowest end of the income distribution. Almost every income decile has lower take home pay now compared with 2010. Left unaddressed, workers will continue to trade disposable income for health premiums.
  • Our current health spending efforts may be misplaced. We must address social determinants of health.  Much of our public spending is devoted to healthcare, but about 40 percent of our life expectancy is individual behavior, and another 30 percent is made up of genetics.
  • A small portion of the population is responsible for most costs – medication adherence strategies can help. Many patients under care for chronic conditions fail to take their medicines—a problem that could cost as much as $6 trillion over the next decade. Multiple solutions, including a new regulatory safe harbor to foster coordination across physicians, pharmacists, payers and manufacturers, would improve adherence and lower costs. Allowing Part D plans to access and use Parts A and B claims data for their enrollees would allow insurers to intervene when a medication is not working or is causing problems.
  • Competition is a big challenge most are not paying attention to. Solutions abound, but political will is weak. Potential solutions in highly concentrated markets were discussed. These include: requiring out-of-network prices to be benchmarked to an average of all private sector rates in the state; requiring site-neutral payments and cost-sharing for similar services in all federal programs, and increasing payments to community-based providers; promoting entry of new competitors by restricting noncompetitive contracts (such as certificates of need); and recognizing the unleveled playing field created by 340B drug pricing by making the program transparent and directed to indigent patients and charitable care, etc.
  • Regulatory reform will proceed, and represents a huge opportunity to lower costs. This summit was held on the first day of the Trump administration’s inaugural open enrollment season. Acting HHS Secretary Eric Hargan underscored to attendees that HHS is committed to creating more flexibility for individuals, plans and states to help create additional choices and competition that lower costs.
  • Lowering drug costs means getting the market more involved. Specialty drugs are currently about 28 percent of health spending and could account for more than 50 percent within the next few years. Value based payment arrangements, particularly those targeted towards specialty pharmacies that include physicians, insurers and pharmacists, should be rapidly tested and deployed. The Council for Affordable Healthcare Coverage estimates such changes could save up to $71 billion annually when fully implemented.

Single-Payer/Universal Health Care Legislative Tracker

Our legal team at Steptoe & Johnson is tracking bills as they are introduced in legislatures across the country. Click here for the most updated chart, as of November 27.

Sneak Peek from our December Leader’s Edge Issue: The Great Cost-Shift

Ian Morrison specializes in long-term forecasting and planning with particular emphasis on healthcare and the changing business environment. He sat down with Leader’s Edge to discuss hospital bills from both the patient and provider perspective, the politics of repeal and replace, and how some providers are already preparing for a Medicare-for-all kind of world. He also addresses employers’ role in long-term change for our healthcare system.

Get the full article.

Cheryl Matochik
The Five Healthcare Fights Facing Congress in December
The Hill

Blaire Bartlett
Report: 27 Things The Feds Could Do To Cut Drug Prices