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Our Take: 2018 Midterm Election: Impact on Health Care

Nov 12, 2018

With several races still undecided, here’s Our Take on the midterm election and its effect on patients, providers and suppliers.

Perhaps the most notable effect of the Democratic takeover of the House is that the Affordable Care Act (ACA) is here to stay.

Three weeks ago, Senate Majority Leader Mitch McConnell, R-Ky., told Reuters that if given the chance—that is, if Republicans remained in control of both chambers of Congress—we could expect another attempted repeal of Obamacare.

But this week, referring to an ACA repeal, McConnell told reporters, “I think it’s pretty obvious, the Democratic House is not going to be interested in that,” adding that he was willing to work on health policy issues on a bipartisan basis.

That’s rich.

Whether you are personally opposed to the ACA or are an Obamacare advocate—or, you don’t have an opinion one way or another—the constant chipping away at Obama’s signature achievement has come to an end. That’s a relief for some Americans that have relied on the ACA and its consumer protections, most notably coverage for pre-existing conditions.

In their numerous attempts at eliminating Obamacare, Republicans misread voters. For many people, the ACA enhanced their sense of safety and security, with pre-existing condition coverage, Medicaid expansion and subsidies for those who couldn’t afford insurance. Taking that away posed a threat to the safety and security of many American families, we believe.

We expect that some of the “fixes” that have come out of the Trump administration might be repealed or regulated by a Democratic House. We don’t expect association health plans or other bargain-basement insurance products that lack ACA protections to survive for long.

That said, a divided Congress means either compromise or inaction on health care. The polls and pundits tell us that voters had health care on their minds when they cast their ballots. The problems we face in health care, including escalating costs everywhere you look, won’t go away without action.

So, over the next two years, we can expect to see one of two things. Republicans in the House and Senate will collaborate with Democrats to fix the problems that are fixable through legislation, with both parties compromising to find solutions. Or, both sides will go to their corners and nothing will get done.

The other consequential effect of the elections is related to Medicaid. Four states had ballot initiatives to approve Medicaid expansion. Three states passed the measure—Nebraska, Idaho and Utah—which will result in health insurance coverage for more than 300,000 lower-income people in those states. The measure failed in Montana, which connected the expansion of Medicaid to an increase in tobacco tax.

With new Democratic governors in Wisconsin, Kansas and Maine, odds are we’ll see expansion coming soon to those states as well. Maine, in fact, already passed a similar ballot initiative that was effectively blocked by outgoing governor Paul LePage.

Finally, there is one industry that should be concerned about the election results, and that’s drug manufacturers. Republicans and the Trump administration already had their sights set on pharma, as we wrote as recently as two weeks ago. With the Democrats in charge, House Leader Nancy Pelosi, D-Calif., said last week that the Democratic priorities are infrastructure and pharmaceutical prices. With both sides having pharma in their sights, it’s hard to imagine a scenario in which pharma doesn’t take a hit.

What else you need to know
New episode-based payment models are coming, including models for cardiac care and radiation oncology—some of which will be mandatory—said Health and Human Services Secretary Alex Azar in remarks last week. Until now, the Trump administration avoided forcing providers into downside-risk models and even eliminated certain mandatory bundled payment programs, such as in cardiac care. Azar said the agency “will use all avenues available to us—including mandatory and voluntary episode-based payment models” to reduce costs and improve care. He said the new models would likely be announced by year-end. More here.

Amazon just released a line of medical devices for patients with diabetes and hypertension. The exclusive brand, named “Choice,” is Amazon’s latest foray into health care. Amazon’s new line of glucose and blood pressure monitors was developed in partnership with Arcadia Group, who previously handled product development of health care devices for Walmart and Abbott. The devices are available for purchase on Amazon.com. More here

Partners HealthCare has canceled its merger plans with Lifespan. Partners is in the process of finalizing its merger with Care New England, Rhode Island’s second-largest health care network, and a three-way merger with Lifespan had been in the works since February. But talks to include Lifespan, the largest health care network in Rhode Island, have been discontinued, according to the Providence Journal. Although no agreement was reached, spokespersons for Partners and Care New England told the Providence Journal that their organizations expect to remain in communication with Lifespan. Still looking to expand its presence in New England, Partners has signaled interest in Exeter Health Resources, of New Hampshire, and is currently in merger talks with Massachusetts insurer Harvard Pilgrim Health. More here.

Walmart is launching an ACO insurance plan for employees in parts of Louisiana, in partnership with Ochsner Health Network. According to the Times Picayune, this marks Ochsner’s first major partnership with a national employer. The new insurance plan, called the Ochsner Accountable Care Plan, will be available on Jan. 1, 2019, to 6,600 Walmart and Sam’s Club associates from 41 stores in the New Orleans and Baton Rouge regions. Walmart has partnered with 10 other health systems to offer ACO programs in other states, the Times Picayune reported. More here.

The FDA has released an open-source app to collect patient-reported data. The app, called MyStudies, was developed in partnership with Kaiser Permanente and is designed to simplify and systemize data collection for researchers and developers. Patients can opt in to share their data with traditional clinical trials, research studies and observational studies. In a press release, FDA Commissioner Scott Gottlieb said, “Better capture of real-world data, collected from a variety of sources, has the potential to make our new drug development process more efficient, improve safety and help lower the cost of product development.” More here.

Geisinger CEO Dr. David Feinberg is joining Google’s leadership team, Geisinger announced. In collaboration with Google’s AI chief, Jeff Dean, Dr. Feinberg is charged with organizing Google’s fragmented health initiatives. Geisinger’s executive vice president and chief medical officer, Dr. Jaewon Ryu, will serve as interim president and CEO starting Dec. 1. More here.

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