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Daily on Healthcare: Trump administration releases proposal to allow people to band together for insurance

Daily on Healthcare: Trump administration releases proposal to allow people to band together for insurance
Daily on Healthcare: Obamacare emerges as wildcard in tax debate
Daily on Healthcare: Obamacare emerges as wildcard in tax debate

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Trump administration releases proposal to allow people to band together for insurance. The Department of Labor released a proposed rule Thursday morning to allow workers to band together to receive health insurance. The rule is in response to President Trump's executive order intended to allow people to buy lower-cost health insurance that can circumvent some of the mandates created under Obamacare. It has been billed by supporters as allowing insurance to be sold across state lines. The Department of Labor's proposal makes regulatory changes to the Employee Retirement Income Security Act, known as ERISA. The proposed regulation would change the definition of "employer" by allowing individual workers or small groups of people with a "commonality of interest" to join together, such as people who are engaged in the same kinds of trade or business. By doing so, they would be considered one large employer for the purpose of providing coverage. Regulations currently stipulate that members have to be in the same industry and that they have to be involved in the day-to-day decisions of a business. The proposal would relax existing requirements that associations sponsoring health plans must exist for a reason other than offering health insurance and the requirement that association members share a common interest, as long as they operate in a common geographic area. Associations whose members are in the same industry, however, could sponsor health plans, regardless of where they do business.

Rule keeps protections for pre-existing conditions, but lets plans skimp on essential health benefits. The rule would open the door for cheaper insurance because plans wouldn’t have to meet Obamacare’s 10 essential health benefits, which include maternity and mental health care, tweeted Larry Levitt, senior vice president for the research firm Kaiser Family Foundation. However, the regulation would “prohibit association health plans from charging differential premiums based on health status,” he added. That is a key protection for people with pre-existing conditions who before Obamacare could be charged higher prices based on their health status. Levitt tweeted that insurers could find “clever ways of cherry picking healthier people implicitly” based on which benefits they cover.

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More regulations expected this year that could reshape Obamacare. The Trump administration is expected to release regulations later this year to extend the duration of short-term health plans. Those plans, which can offer skimpier coverage than those on Obamacare’s exchanges, currently expire after 90 days. The same executive order that expanded association health plans also would expand the duration of short-term plans to 364 days a year. Coupled together, the two regulations could reshape Obamacare by offering cheaper but skimpier coverage. Critics say the moves could further destabilize the law’s exchanges by causing healthy customers to flee the exchanges for the cheaper plans.

But Trump administration says individual mandate can help stabilize the exchanges. The Trump administration said that it considered whether the association health plan rule would make risk pools sicker on the individual and small group markets. It said that the individual market, which is used by people who don’t have insurance through a job or the government and includes Obamacare’s exchanges, would be more susceptible to adverse risk selection than the small group market. However, it says Obamacare’s individual mandate that “essentially all individuals acquire coverage” and the subsidies to lower insurance costs could blunt any impact. But the individual mandate’s penalties were repealed starting in 2019 as part of the tax reform legislation, taking away an avenue the Trump administration said could help mitigate any impact of adverse selection.

Rand Paul is pretty happy. Sen. Rand Paul, R-Ky., praised the proposed rule on association health plans. “For the past year, I have worked with the president and his administration to dramatically increase the availability of healthcare while at the same time decrease the costs. I applaud the administration for its action today, and I look forward to the finalization of the proposed rule,” Paul said in a statement Thursday. Paul had tried to include the reforms in his own bills to repeal and replace Obamacare, but was rebuffed by Senate leadership. “Conservative healthcare reform is alive and well, and I will keep working with President Trump to build on this progress,” Paul said.

Trump to meet with GOP senators on party’s agenda. Senate leaders are meeting at 2:15 p.m. with President Trump to hash out the party’s plans and priorities for 2018. Before leaving for winter break, members showed division over whether to pass bipartisan bills aimed at stabilizing Obamacare or to take another shot at repealing portions of the law. The party already notched a victory by repealing the penalties for Obamacare in tax legislation. Having passed that bill, House Speaker Paul Ryan said he was interested in looking next at entitlement reform, but White House press secretary Sarah Sanders said Trump hasn’t changed his position on protecting entitlement programs such as Medicare and Medicaid from cuts.

No spending deal after GOP, Democrats meet with White House officials. Republicans and Democrats on Wednesday failed to reach a spending agreement after huddling with White House officials, after which both parties said they would keep trying in the coming days, but there were signs that the deal was still far out of reach. Democrats may be forced to choose whether to accept the two-year spending deal the GOP is seeking or threaten a government shutdown by blocking it in the Senate. Democrats said little coming out of the meeting, except that they hope further talks will result in some deal. Democrats also want to ensure that if spending caps rise for defense, they also rise for nondefense items. “We had a positive and productive meeting and all parties have agreed to continue discussing a path forward to quickly resolve all of the issues ahead of us," House Minority Leader Nancy Pelosi, D-Calif., and Senate Minority Leader Chuck Schumer, D-N.Y., said in a statement late Wednesday afternoon. Office of Management and Budget Director Mick Mulvaney and Marc Short, the White House's top liaison to Congress, were also at the meeting.

Lawmakers discussing CHIP and community health center funding. Sen. Ron Wyden, the top Democrat on the Senate Finance Committee, declined Wednesday to say how confident he is that the Children’s Health Insurance Program will be fully funded by Jan. 19. “I continue to believe that the approach we are pursuing in the Senate, keeping it bipartisan and not having this kinda elbowing and partisanship in the House, will pay off in the end,” he told reporters. He said that the short-term spending bill had helped but that states and advocates were still concerned. Advocates and health leaders, he said, were “glad that the bridge funding came together, but they’ve got to have this resolved quickly because they are going in the legislative session and you know this bedlam has real human consequences for kids and families.”

Drawing imperils opportunity for Medicaid expansion in Virginia. Republican David Yancey won the Virginia House of Delegates race in the 94th District after his name was pulled out of a ceramic bowl Thursday. The dramatic result means that Republicans keep a 51-49 majority in the House of Delegates and imperils Virginia’s chances of expanding Medicaid. If Democrat Shelly Simonds had won, it would have left the chamber with a 50-50 tie, with Democratic Lt. Gov. Justin Fairfax able to break any tie. Republicans also keep a one-seat majority in the state Senate.

Senate ends week early as storm makes its way up East Coast. Senators will not hold any more votes this week as a major winter storm is tearing through the East Coast. "There will be no further roll call votes during this week's session of the Senate," Senate Majority Leader Mitch McConnell, R-Ky., said on the floor to close out the day Wednesday. Members still held their weekly party lunches. The House is not in session this week. The storm, which has already hit parts of the South, is rolling north and is expected to intensify Thursday. Some meteorologists are calling the weather event a "bomb cyclone." Ending the week early will allow senators to return home.

Lawmakers met with psychiatrist who questioned Trump's mental health in book: Report. More than a dozen lawmakers have discussed Trump with a Yale University psychiatrist who edited a book rejecting her field's longstanding principle that it is unethical for psychiatrists to issue a diagnosis without a personal exam. Dr. Brandy Lee, who has not examined Trump, spoke to more than a dozen Democratic lawmakers and one Republican senator, she told Politico in a report published Wednesday. Lee declined to identify the Republican. She predicted to lawmakers that Trump was “going to unravel, and we are seeing the signs.” The meetings were held Dec. 5 and 6. Lee is the editor of The Dangerous Case of Donald Trump, which includes testimonials from 27 psychiatrists and mental health experts. The book rejects the longstanding "Goldwater rule” directing psychiatrists to examine patients rather than speculating about a diagnosis. Trump will undergo a routine physical at Walter Reed National Military Medical Center in Bethesda, Md., on Jan. 12, the White House said. As with past presidents, it is unlikely to include an in-depth psychiatric analysis.

Orrin Hatch says he'd endorse Mitt Romney for Utah Senate seat. Sen. Orrin Hatch, R-Utah, said that he would endorse Mitt Romney if he was to run to fill his Senate seat. Hatch, who announced his upcoming retirement on Tuesday, said that he didn’t call the former GOP presidential candidate before he made his announcement but he did call him a while back and “explored with him what he had on his mind.” “There's no question that he loves Utah and wants to support Utah anyway he can,” Hatch continued on Utah's Morning News. “And I'm hopeful he'll run, because he would be just fine. And he would certainly be somebody who I think could succeed me into the job. We haven't spoken in the last few days, but if Mitt decides to run, he knows he'll have my support." Despite previous disagreement, Hatch noted that Romney would end up supporting the president when pursuing a conservative agenda.

Watchdog: Drug makers owe Medicaid about $1.3 billion. The federal government paid much more money for drugs than it should have over the past five years because of some misclassifications from drug makers, a new report finds. Health and Human Services’ Inspector General said that over the past five years, drug makers possibly misclassified drugs to keep $1.3 billion in rebate money that should have gone to states under a Medicaid program. “Every misclassification could result in hundreds of thousands of dollars lost — money that would have been used to provide essential care to vulnerable Americans, including seniors and children,” said Sen. Susan Collins, R-Maine. The federal government requires drug makers to provide a rebate to state Medicaid agencies for drugs sold on the program. The drug maker classifies whether the drug is a brand name or a generic, with a brand name paying a higher rebate than a generic. But some drug makers misclassify a brand name drug as a generic, paying the lesser rebate. A major example of this is the EpiPen, which drug maker Mylan classified as a generic drug when it was in fact a brand name product. Mylan paid the federal government $465 million in August to resolve a federal lawsuit over the rebates. The inspector general found that most of the approximately 30,000 drugs in the rebate program were classified appropriately, but 885 of those drugs (about 3 percent) were misclassified, according to Collins’ office. It found that over the past five years, manufacturers might have underpaid Medicaid $1.3 billion in rebates for 10 possibly misclassified drugs.


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Senate in session. House not in session.

2:15 p.m. President Trump to meet with Republican senators to discuss 2018 priorities.

TUESDAY | Jan. 9

9 a.m. 215 Dirksen. Senate Finance Committee to hold a confirmation hearing for Alex Azar, President Trump’s pick for Health and Human Services Secretary. Details.

10 a.m. 430 Dirksen. Senate Health, Education, Labor and Pensions Committee hearing on “The Opioid Crisis: An Examination of How We Got Here and How We Move Forward.” Details.