A Judicial Body Blow to the ACA
The Host
Julie Rovner
KHN
Julie Rovner is chief Washington correspondent and host of KHN’s weekly health policy news podcast, “What the Health?” A noted expert on health policy issues, Julie is the author of the critically praised reference book “Health Care Politics and Policy A to Z,” now in its third edition.
Opponents of the Affordable Care Act may have stopped trying to overturn the entire law in court, but they have not stopped challenging pieces of it — and they have found an ally in Fort Worth, Texas: U.S. District Judge Reed O’Connor. In 2018, O’Connor held that the entire ACA was unconstitutional — a ruling eventually overturned by the Supreme Court. Now the judge has found that part of the law’s requirement for insurers to cover preventive care without copays violates a federal religious freedom law.
In a boost for the health law, though, North Carolina has become the 40th state to expand the Medicaid program to lower-income people who were previously ineligible. Even though the federal government will pay 90% of the cost of expansion, a broad swath of states — mostly in the South — have resisted widening eligibility for the program.
This week’s panelists are Julie Rovner of KHN, Alice Miranda Ollstein of Politico, Rachel Cohrs of Stat, and Sandhya Raman of CQ Roll Call.
Panelists
Rachel Cohrs
Stat News
Alice Miranda Ollstein
Politico
Sandhya Raman
CQ Roll Call
Among the takeaways from this week’s episode:
- Thursday’s decision out of Texas affects health plans nationwide and is expected to disrupt the health insurance market, which for years has provided preventive care without cost sharing under the ACA. Even if the decision survives a likely appeal, insurers could continue offering the popular, generally not-so-costly benefits, but they would no longer be required to do so.
- The decision, which found that the U.S. Preventive Services Task Force cannot mandate coverage requirements, hinges on religious freedom objections to plans covering PrEP, the HIV medication, alongside other preventive care.
- Speaking of the ACA, this week North Carolina became the latest state to expand Medicaid coverage under the health law, which will render an estimated 600,000 residents newly eligible for the program. The development comes amid reports about hospitals struggling to cover uncompensated care, particularly in the 10 states that have resisted expanding Medicaid.
- Pushback against Medicaid expansion has contributed over the years to a yawning coverage divide between politically “blue” and “red” states, with liberal-leaning states pushing to cover more services and people, while conservative-leaning states home in on policies that limit coverage, like work requirements.
- On the abortion front, state attorneys general are challenging the FDA’s authority on the abortion pill — not only in Texas, but also in Washington state, where Democratic state officials are fighting the FDA’s existing restrictions on prescribing and dispensing the drug. The Biden administration has adopted a similar argument as it has in the Texas case challenging the agency’s original approval of the abortion pill: Let the FDA do its job and impose restrictions it deems appropriate, the administration says.
- The FDA is poised to make a long-awaited decision on an over-the-counter birth control pill, an option already available in other countries. One key unknown, though, is whether the agency would impose age restrictions on access to it.
- And as of this week, 160 Defense Department promotions have stalled over one Republican senator’s objections to a Pentagon policy regarding federal payments to service members traveling to obtain abortions.
Plus, for “extra credit,” the panelists suggest health policy stories they read this week that they think you should read, too:
Julie Rovner: New York Magazine/The Cut’s “Abortion Wins Elections: The Fight to Make Reproductive Rights the Centerpiece of the Democratic Party’s 2024 Agenda,” by Rebecca Traister.
Alice Miranda Ollstein: Stat’s “How the Drug Industry Uses Fear of Fentanyl to Extract More Profit From Naloxone,” by Lev Facher.
Rachel Cohrs: The Washington Post’s “These Women Survived Combat. Then They Had to Fight for Health Care,” by Hope Hodge Seck.
Sandhya Raman: Capital B’s “What the Covid-19 Pandemic and Mpox Outbreak Taught Us About Reducing Health Disparities,” by Margo Snipe and Kenya Hunter.
Also mentioned in this week’s podcast:
- The New York Times’ “‘We’re Going Away’: A State’s Choice to Forgo Medicaid Funds Is Killing Hospitals,” by Sharon LaFraniere.
- KHN’s “Fresh Produce Is an Increasingly Popular Prescription for Chronically Ill Patients,” by Carly Graf.
- California Healthline’s “Prescription for Housing? California Wants Medicaid to Cover 6 Months of Rent,” by Angela Hart.
click to open the transcript
Transcript: A Judicial Body Blow to the ACA
KHN’s ‘What the Health?’Episode Title: A Judicial Body Blow to the ACAEpisode Number: 291Published: March 30, 2023
[Editor’s note: This transcript, generated using transcription software, has been edited for style and clarity.]
Julie Rovner: Hello and welcome back to KHN’s “What the Health?” I’m Julie Rovner, chief Washington correspondent at Kaiser Health News. And I’m joined by some of the best and smartest health reporters in Washington. We’re taping this week on Thursday, March 30, at 11 a.m. As always, news happens fast, and things might have changed by the time you hear this. So here we go. Today we are joined via video conference by Alice Miranda Ollstein of Politico.
Alice Miranda Ollstein: Good morning.
Rovner: Sandhya Raman of CQ Roll Call.
Sandhya Raman: Good morning.
Rovner: And happy birthday to you.
Raman: Thank you.
Rovner: And Rachel Cohrs of Stat News.
Rachel Cohrs: Hi, everybody.
Rovner: We’ve got breaking news, so we will get right to it. In Texas, we’ve got a major decision from a federal judge with national implications. No, not the abortion pill case — that is still out there. This time, Judge Reed O’Connor has ruled that the Affordable Care Act can’t require coverage of preventive services recommended by the [U.S.] Preventive Services Task Force because the PSTF, as an independent advisory board, can’t legally mandate anything. This case was specifically — although it was about a lot of things — but it was mostly about employers who didn’t want to cover preexposure prophylaxis [PrEP] for people at high risk of HIV because it violated their religious beliefs. And if the name Reed O’Connor sounds familiar, that’s because he’s the same judge who ruled in 2018 that the entire Affordable Care Act was unconstitutional, a finding that wasn’t formally overturned until it got to the Supreme Court. Alice, you’ve been following this case. What happens now?
Ollstein: I’m expecting the Biden administration to appeal at lightning speed, although that appeal will go to the 5th Circuit, which is very right-leaning. It’s ruled to chip away at the Affordable Care Act in the past. So who really knows what will happen there? But yeah, this is really huge. This is saying that this board that has decided what services insurance companies have to cover for free, with no cost sharing, going all the way back to 2010 is not constitutional, and thus what they say can’t be enforced. And so this throws the insurance market into a bit of chaos.
Rovner: Yeah, although one would think that it wouldn’t affect this year’s policies — I mean, for people who are going to be worried that all of a sudden, you know, oh my God, I scheduled my mammogram and now my insurer might not pay for it. It’s not going to be that immediate, right?
Ollstein: We’re not expecting that. I mean, we’re expecting the Biden administration to ask for courts to stay the impact of the ruling until further arguments and appeals can be made. But we really don’t know at this point. And I will say, you know, I’ve seen some misinformation out there about how the ruling deals with contraception. They do not block the contraception mandate. That is related to this case, but the court did not accept that part of the challengers’ claims.
Rovner: Yeah, we should say there are a bunch of different claims and the judge only accepted a couple of them. It could have been even broader. But, you know, unlike the previous Affordable Care Act cases, this one doesn’t threaten the entire law, but it does threaten one of the law’s most popular pieces, those requirements that plans cover preventive care that’s been shown to be cost-effective. This could be an uncomfortable case for the Supreme Court, assuming it gets there, couldn’t it?
Cohrs: It could be an uncomfortable case for the Supreme Court, but it’s also uncomfortable for insurers, too, who’ve promised this. People have come to expect it. And if it is cost-effective, I mean, certainly there may be plans that, you know, make choices to restrict coverage or impose some cost sharing. If this stands, if this is applied nationwide — again, very big ifs at this point — but if these really are cost-effective, then it’s kind of an open question what insurers will choose to do, because obviously they want people to enroll in their plans as well.
Rovner: Yeah, I was going to say, I could see insurers sort of deciding as a group that we’re going to keep providing this stuff, as you say, Rachel, because they want, you know, they want to attract customers, because for the most part it’s not that expensive. I mean, obviously, you know, things like colonoscopies can run into the thousands of dollars, but a lot of these things are, if not de minimis, then just not very expensive. And, as I mentioned, they’re very popular. So it’s possible that, even though they may strike down the mandate, there won’t be as much of an impact from this as some people are saying. But, as Alice points out, we don’t really know anything at this point.
Ollstein: And I think some of the concern is the kind of risk-pool sorting we used to see, you know. So the challengers said that their right to purchase insurance that doesn’t cover certain things was being infringed upon. And so if insurers start to create separate plans, some of which cover all kinds of preventive care, including sexual health care, and separate ones that don’t, and people who don’t think they need a lot of stuff, you know, sort themselves into some plans and not others, you can see that reflected in premiums that could lead to some of the major pre-ACA problems we used to see.
Rovner: If the idea that somebody doesn’t like something and therefore can’t buy something without it, you can see that leading to all kinds of problems down the line about people saying, well, “I don’t like that drugstores sell condoms, so therefore I should be able to go to a drugstore that doesn’t sell condoms,” although that’s not a mandate. But you can see that this could stretch very far with people’s religious beliefs. And indeed, the basis of this claim is that this violated the Religious Freedom Restoration Act. That’s one of the things that Judge O’Connor found, and that could be taken to quite the extreme, I imagine.
Ollstein: Right. I mean, they weren’t required to actually purchase PrEP. They weren’t required to use it. They weren’t required to prescribe it. Just the insurance company was required to cover it along with everything else they cover. And the folks said even purchasing insurance that had that as one of the things it could conceivably cover violated their religious rights.
Rovner: Yes. And this goes back to the contraceptive cases, where the religious organization said that, you know, by having birth control in their plans, it made them complicit in something that they thought was a sin. And that’s exactly what’s being stressed here, even among the individual plaintiffs: that having to buy insurance that has these benefits, even if they don’t use them, makes them complicit in, basically, sex outside of marriage. I mean, that’s what’s in the decision. It’s quite a reach. I’ll be interested to see, as this goes up, what people think of it. So, before we got Judge O’Connor’s opinion, what I thought would be the biggest news of the week comes from North Carolina, which on Monday became the 40th state to expand Medicaid under the Affordable Care Act, to cover people with incomes up to 138% of poverty. That’s about $20,000 in 2023. Well, it’s almost there. The newly eligible 600,000 people won’t be able to sign up until the legislature approves a budget, which is likely later this spring. North Carolina expanding the program leaves only a swath of states across the South, including Florida, Georgia, and Texas, and a couple in the Great Plains as still holding out on a 90% federal match. Is anyone else on the horizon or is this going to be it for a while?
Raman: I think one thing to note about how this is happening is that North Carolina was able to do this finally through the legislature after like a yearslong process. And it has been increasingly rare for this to happen through the legislature. The last time was Virginia, in 2018, but every other state that has done it in recent years has all been through ballot initiative and going that route. And the 10 holdouts that we have, you know, we have Republican-controlled legislatures who’ve been pretty against doing this. So I think if any of those states were to be able to do that at this point that haven’t been tempted by, you know, any of the incentives … [unintelligible] … get a higher match rate or anything like that, it would have to be through the ballot, which is already a difficult process, can take years. There have been various roadblocks to push back and even some of the states in the past that have been able to get it through ballot initiative — some of the legislatures afterwards have tried to like push back on it — when we saw with Utah a few years ago, where even if the voters had voted that they wanted to expand, they wanted to kind of pull it back.
Rovner: We thought in Maine, where the governor blocked it until basically he was out of office.
Raman: Yeah.
Ollstein: And in Missouri, where they just refused to fund it.
Raman: Yeah, so I think that’ll be definitely something to watch with how the budget goes in the next few months. But I guess, at least with North Carolina, this was something that was bipartisan. It was spearheaded in the legislature by Republicans, so I think they might not have the same issues there than Missouri, but it’s a tough haul to get the remaining 10 at this point after this many years.
Rovner: Yeah, I feel like North Carolina is much more like Virginia, which is that, finally, after a lot of wearing down, the Republican legislature and the Democratic governor were able to come to some kind of agreement. That’s what happened in Virginia. And that seems to be what’s happened here in North Carolina. Meanwhile, in those 10 states, hospitals which end up providing free care to people who can’t pay aren’t doing so well. In Florida, the state’s hospital association has been all but begging the state government to expand Medicaid pretty much since it was available to them, which is now going on 13 years. According to the American Hospital Association, 74% of rural hospital closures around the country took place in states that have not expanded Medicaid or where expansion had been in place for less than a year. And the New York Times has a story this week about the toll that that lack of insurance is taking — I’m sorry — and the New York Times has a story this week about the toll that lack of insurance for the working poor is taking there, not just on the state’s hospitals, but on the health of the state’s population. Lawmakers in these states are very happy to take federal money for all manner of things. What is it about this Medicaid expansion that’s making them say, “No, no, no”?
Raman: This was something that came up this week in the House. Appropriations’ Labor, HHS, Education Subcommittee had a hearing this week specifically on rural communities and some of the issues they face. And Medicaid expansion obviously did come up with some of the witnesses and some of the lawmakers as something that would be helpful given the number of hospital closures they’ve seen, and there might only be one health care facility for miles or in a county, and just how it would be helping them to kind of relieve paying for the uncompensated care that they’re already dealing with, you know, highlighted a number of the issues there. So it’s something that comes up, but I think one of the pushbacks that we saw was, you know, again, that it is a) tied to the Affordable Care Act, which has been such a partisan back-and-forth since its inception, and then b) just the messaging has always been about the cost. I mean, even if the general consensus is that it does save money over time for taking care of that care, something that came up was why states get more of a reimbursement for expansion than they do for traditional Medicaid. That was brought up a couple times, things like that. And so I think it’s hard to get some of those folks on board just because of how partisan it has become.
Rovner: Yeah, I remember I watched the hearing in Wyoming on this last year. They didn’t want to do it, it seemed, more for ideology. I mean, a lot of states that are doing this, you know, you can levy a tax on hospitals and nursing homes, who are happy to pay the tax because they’re now getting paid for these patients who couldn’t pay. And the state’s really not out-of-pocket, as it were, at all. But and yet, as we point out, these last 10 states, including some of the really big ones, have yet to actually succumb to this. Well, while we are talking about Medicaid, there have been a couple of interesting stories from my KHN colleagues in the past few weeks about so-called social determinants of health, those not strictly medical interventions that have a big impact on how sick or healthy people are. In California, Democratic Gov. Gavin Newsom wants to use Medicaid to pay for six months of rent or temporary housing for homeless people. And in Montana, health professionals can now prescribe vouchers for fruit and vegetables for patients with little access to fresh food. Is this the wave of the future, or will those who want to shrink rather than expand the welfare state and government in general roll programs like these back?
Cohrs: I think there certainly is a trend, a lot of momentum behind the idea of food as medicine and, you know, moving away and exploring some of these non-medication treatments or some of these underlying reasons why people do have health issues. I think certainly support for the Medicaid program is going to be a hot-button issue in D.C. over the next few months, but there is a lot that states can do on their own as well. And I know states have, you know, programs to kind of cover people that fall between the cracks of traditional insurance programs. California has a robust program for that, the local levels as well. So I think there may be ways to get around that, even if we do see some more restrictions. And again, the administration is Democratic at this point, so I think they may be friendlier to some of these innovations than prior ones, and that could change at any time. But this certainly isn’t something that’s going to go away.
Rovner: I wonder if we’re going to end up with blue states having all of these more robust pro — I mean, we already have blue states with more robust programs, but blue states having these more inclusive programs and red states not. Alice, you’re nodding.
Ollstein: Absolutely. And that’s been the trend for a while, but it could even accelerate now, I think, and you’re seeing that on both sides, with blue states looking to cover more and more things; also looking to cover more and more people, including undocumented people. That’s another trend in Medicaid. At the same time, you have red states that have long explored how to cover fewer and fewer, you know, trying to change the income eligibility threshold for expanded Medicaid, trying to do work requirements, trying to do, like, other restrictions. And so I think the patchwork and the divide is only going to continue.
Rovner: Well, moving on to abortion this week, we are still waiting, as I said, for that other decision out of Texas that could impact the future of the abortion pill mifepristone. But Alice, there’s another case at the other end of the country that could have something to say about the Texas case. What’s going on in Washington state?
Ollstein: This one has really flown under the radar. So this is an interesting situation where the same — a lot of the same Democratic attorneys general who were siding with the Biden administration in the Texas case are challenging the Biden administration in a different case in Washington state, basically saying that the remaining federal restrictions on abortion pills — mainly that providers have to get certified in order to prescribe the drugs or dispense them — saying that that should be tossed out, that it’s not supported by medicine and science. And so it’s interesting because you have the Biden administration fighting back against an effort to make the pills more accessible, which is not what a lot of people expect. It goes sort of against their rhetoric in recent months; they’ve talked about wanting to make the pills more accessible and they’re opposing an effort that would do that. But it is somewhat consistent with their position in the Texas case, which is, they’re saying, “Look, this is the FDA’s job. Let the FDA do its job. The FDA has a process, came up with these rules, got rid of some, kept others, and you outside folks don’t have the right to challenge and overturn it.”
Rovner: So what happens if the judges in both of these cases find for the plaintiffs, which would be kind of, but not completely, conflicting?
Ollstein: Yeah, so the Washington state case could just apply to the dozen states that are part of the challenge. And so you could have, again, more of a patchwork in which the abortion pills become even more accessible in those blue states and even less accessible in other states. You could also have these competing rulings that ultimately trigger Supreme Court review.
Rovner: Yeah, it’s not exactly a circuit split because it wouldn’t be opposite decisions on the same case; they’re different cases here. But as you point out, it’s really a case challenging the authority of the FDA to do what the FDA does. So it’s going to be really interesting to watch how this all plays out. While the future of mifepristone remains in doubt, the FDA is going to consider making at least one birth control pill over the counter. We know that morning-after pills, which are high doses of regular birth control pills, are already available without a prescription. So why hasn’t there been an over-the-counter birth control pill until now?
Ollstein: Everything concerning birth control, emergency contraception, abortion, it just — these fights drag on for years and years and years. So finally, we seem to be on the cusp of having a decision on this. It’s expected, from most people I’ve talked to, that they will approve this over-the-counter birth control. There’s a lot of data from around the world. A lot of other countries already have this. And one key unknown is whether the FDA will maintain an age restriction on it. A lot of progressive advocates do not want an age restriction because they think that this is important to help teens prevent unwanted pregnancies. And I think that’s going to be a big piece of the fight that I’m watching.
Rovner: And oh, my goodness, it was that age restriction that held up the over-the-counter morning-after pill for years. That was like a 13-year process to get that over the counter. It went on and on and on, and I covered it. All right. Well, there is abortion-related action on Capitol Hill too this week. We’ve got a potential abortion standoff brewing in the Senate over reproductive health policy at the Department of Defense. Who wants to talk about that one?
Raman: This one has been, I think, really interesting, since we’re all health reporters. And it’s been really something that I think my defense colleagues have been following so closely. But we have Senator Tuberville, who’s been holding up military nominations because the Pentagon has a policy that allows, you know, service members leave for reproductive care and it covers travel to seek an abortion. And so —
Rovner: Although it still doesn’t pay for the abortion.
Raman: It does not pay for the abortions. It’s for the travel. And so I know that my colleagues have looked at this and how this point, like, both sides have been getting a little frustrated, you know, with even some senators saying, “Hey, I agree that I don’t like this policy, but you need to find another way,” because as of earlier this week 160 promotions have been stalled. And so it’s just been kind of ramping up and holding up a lot of folks for kind of an unusual method.
Rovner: Yeah, and the defense secretary saying, I mean, this threatens national security because these are promotions — are important promotions. Flag officers, these are not, you know, just sort of — they’re routine, but they’re, you know, but if they don’t happen, if they get stalled, it’s a problem. In all of my years of seeing anti-abortion senators hold up things, this is not one I have seen before. It’s at least — it’s sort of new and imaginative, and I guess we will see how that plays out. Back in the states, though, it seems that the efforts to restrict reproductive rights are getting very extreme, very fast. Yes, the Oklahoma Supreme Court ruled earlier this month that a pregnant woman does have a right to an abortion when continuing the pregnancy threatens her life. But four of the nine justices there didn’t even want to go that far, suggesting that the legislature has the right to basically require saving the fetus even at the cost of the pregnant person’s life. In Texas, a lawsuit in which the ex-husband is suing the friend of his ex-wife for the wrongful death of his child for helping her get abortion medication is setting the stage for the so-called personhood debate: the idea that a new person with full legal right is created upon fertilization of an egg by sperm. Over the past few decades, several states have rejected personhood ballot measures as a bridge too far. But it feels like all bets are off now. I mean, it’s sort of like a race to see who can be the most extreme state.
Ollstein: I think the trends are revealing some interesting things. I mean, one, anti-abortion folks are well aware that people are still getting abortions, mainly in one of two ways: either traveling out of state or ordering pills online and taking them at home, both of which are very difficult to enforce and stop. And so there’s just a lot of, like, throwing spaghetti against the wall and seeing what sticks, in terms of, can we actually criminalize either of those things? If so, how is it enforced, or does it even need to be enforced? Or is just the fear and the chilling effect enough? I mean, we definitely see that. We definitely see medical providers holding off on doing even perfectly legal things because of fear and the chilling effect. And so there’s just a lot of experimentation at the state level right now.
Rovner: Yeah, I forgot to mention Idaho, where the legislature introduced a bill that would make it a crime — that creates abortion trafficking as a crime — for someone to take a minor, it’s not really across state lines, because the state can’t do that, so it’s like taking the minor to the border in an effort to cross state lines to get an abortion. There was, for many years in the late 1990s and early 2000s, something called the Child Custody Protection Act in Congress, because they needed that for the interstate part of it, that would make it a crime to take a minor across state lines in violation of the home state’s parental involvement laws. It passed both the House and the Senate at various times. It never became law. It’s been introduced recently, but nobody’s tried to take it up recently. I wouldn’t be surprised to see that come back up, too. But it really does seem that every day there’s another bill in another state legislature that says — after all the claims of the anti-abortion movement for decades, that we don’t want to punish the women, we only want to punish the providers — that’s gone out the window, right?
Raman: I guess I would add that, you know, we’re seeing a lot of this activity now. But something that I keep in mind is that a) it’s gotten a lot harder to know what’s going to, you know, using the spaghetti metaphor that Alice did, like what will stick. So there’s just a lot more flurry of action. And then I feel like I see increasingly, you know, people, since they don’t know that, just like fixating a lot on various things, just because you don’t know. I think, you know, even a few years ago, there were a lot of things that would have one sponsor or two sponsors and have no chance of going anywhere, as most bills introduced anywhere do. But now, a) a lot of these things are moving very, very quickly in the legislature, and b) since we don’t know, it’s hard to know where to kind of focus, even to some of the experts that I’ve talked to, where it’s just, “We’re not sure.” So just be aware of all of these things in various places because of kind of that uncertainty.
Rovner: Yeah, I know I’m generally loath to talk about bills that got introduced either in Congress or in state legislatures, because I think it unnecessarily creates expectations that for the most part don’t happen. But as both of you say, some of these things are happening so fast that, if you mention them one week, they’re law by the next week. So we will see as this continues to move quickly. All right. That’s the news for this week. Now it is time for our extra credit segment. That’s when we each recommend a story we read this week we think you should read too. As always, don’t worry if you miss it. We will post the links on the podcast page at khn.org and in our show notes on your phone or other mobile device. Rachel, why don’t you go first this week?
Cohrs: All right. So my story is from the Washington Post, and the headline is “These Women Survived Combat. Then They Had to Fight for Health Care,” by Hope Hodge Seck. And I thought it was just a really great feature on this very niche issue. And I think veterans’ kind of health care overall just doesn’t get as much coverage as it should, and —
Rovner: Particularly women’s veteran’s health care.
Cohrs: Exactly. Yes. And so these women were essentially going into combat situations to help relations with women in very conservative cultures, and they were exposed to the grenade blasts and a lot of these combat situations. But then their health care coverage upon returning wasn’t covered. And there is kind of a new bill with some momentum behind it that is trying to plug that loophole. So, yeah, I thought it was a very great feature on an issue that’s undercovered.
Rovner: Yeah, this was something I knew nothing about until I read this story. Alice?
Ollstein: I chose a piece by Rachel’s colleague at Stat, Lev Facher, called “How the Drug Industry Uses Fear of Fentanyl to Extract More Profit From Naloxone.” And this is really timely, with the approval this week of over-the-counter opioid-overdose-reverse medication. And basically it’s about how these drug companies are coming up with new forms of the drug, really huge doses, new delivery forms, injectables, and nasal sprays, and stuff that are not really justified by science and are sort of just an opportunity for more profit because the basic form of the drug that works extremely well and is very affordable, they are basically hyping the fear of fentanyl to try to push these stronger products they’re coming up with. And the fear is that municipal governments that have limited resources are going to spend their money on those not really justified new forms and get fewer medication for everyone than just using the basic stuff that we know works.
Rovner: Indeed. Sandhya?
Raman: My extra credit is from Margo Snipe and Kenya Hunter at Capital B, and it’s called “What the Covid-19 Pandemic and Mpox Outbreak Taught Us About Reducing Health Disparities.” And I thought this was an interesting look that they did, highlighting how, you know, there’s been a lot more talk about the various health inequities among, you know, racial and ethnic and sexual minority communities after these two pandemics have started. And they look at how some of the targeted efforts have narrowed some of the gaps in things like vaccines, but just how some of these lessons can be used to address other health disparities, you know, things like community outreach and expanding types of screenings and how many languages public health information is translated into and things like that. So, it’s a good read.
Rovner: Well, my extra credit this week is a long read, a very long read, by Rebecca Traister in New York Magazine, called “Abortion Wins Elections: The Fight to Make Reproductive Rights the Centerpiece of the Democratic Party’s 2024 Agenda.” And while I’m not sure I’m buying everything that she’s selling here, this is an incredibly thorough and interesting look at the past, present, and possibly future of the abortion rights movement at the national, state, and local levels. If you are truly interested in this subject, it’s well worth the half hour or so of your time that it takes to get through the entire thing. It’s a really, really good piece. OK, that is our show for this week. As always, if you enjoyed the podcast, you can subscribe wherever you get your podcasts. We’d appreciate it if you left us a review; that helps other people find us too. Special thanks, as always, to our ever-patient producer, Francis Ying. Also, as always, you can email us your comments or questions. We’re at whatthehealth@kff.org. Or you can tweet me still. I’m @jrovner. Alice?
Ollstein: @AliceOllstein.
Rovner: Rachel?
Cohrs: @rachelcohrs.
Rovner: Sandhya?
Raman: @SandhyaWrites.
Rovner: We will be back in your feed next week. Until then, be healthy.
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Julie Rovner
KHN
Julie Rovner is chief Washington correspondent and host of KHN’s weekly health policy news podcast, “What the Health?” A noted expert on health policy issues, Julie is the author of the critically praised reference book “Health Care Politics and Policy A to Z,” now in its third edition.
President Joe Biden’s fiscal 2024 budget proposal includes new policies and funding boosts for many of the Democratic Party’s important constituencies, including advocates for people with disabilities and reproductive rights. It also proposes ways to shore up Medicare’s dwindling Hospital Insurance Trust Fund without cutting benefits, basically daring Republicans to match him on the politically potent issue.
Meanwhile, five women in Texas who were denied abortions when their pregnancies threatened their lives or the viability of the fetuses they were carrying are suing the state. They charge that the language of Texas’ abortion ban makes it impossible for doctors to provide needed care without fear of enormous fines or prison sentences.
This week’s panelists are Julie Rovner of KHN, Shefali Luthra of The 19th, Victoria Knight of Axios, and Margot Sanger-Katz of The New York Times.
Panelists
Victoria Knight
Axios
Shefali Luthra
The 19th
Margot Sanger-Katz
The New York Times
Among the takeaways from this week’s episode:
- Biden’s budget manages to toe the line between preserving Medicare and keeping the Medicare trust fund solvent while advancing progressive policies. Republicans have yet to propose a budget, but it seems likely any GOP plan would lean heavily on cuts to Medicaid and subsidies provided under the Affordable Care Act. Democrats will fight both of those.
- Even though the president’s budget includes something of a Democratic “wish list” of social policy priorities, the proposals are less sweeping than those made last year. Rather, many — such as extending to private insurance the $35 monthly Medicare cost cap for insulin — build on achievements already realized. That puts new focus on things the president has accomplished.
- Walgreens, the nation’s second-largest pharmacy chain, is caught up in the abortion wars. In January, the chain said it would apply for certification from the FDA to sell the abortion pill mifepristone in states where abortion is legal. However, last week, under threats from Republican attorneys general in states where abortion is still legal, the chain wavered on whether it would seek to sell the pill there or not, which caused a backlash from both abortion rights proponents and opponents.
- The five women suing Texas after being denied abortions amid dangerous pregnancy complications are not asking for the state’s ban to be lifted. Rather, they’re seeking clarification about who qualifies for exceptions to the ban, so doctors and hospitals can provide needed care without fear of prosecution.
- Although anti-abortion groups have for decades insisted that those who have abortions should not be prosecuted, bills introduced in several state legislatures would do exactly that. In South Carolina, those who have abortions could even be subject to the death penalty. So far none of these bills have passed, but the wave of measures could herald a major policy change.
Also this week, Rovner interviews Harris Meyer, who reported and wrote the two latest KHN-NPR “Bill of the Month” features. Both were about families facing unexpected bills after childbirth. If you have an outrageous or exorbitant medical bill you want to share with us, you can do that here.
Plus, for “extra credit,” the panelists suggest health policy stories they read this week that they think you should read, too:
Julie Rovner: KHN’s “Girls in Texas Could Get Birth Control at Federal Clinics, Until a Christian Father Objected,” by Sarah Varney
Shefali Luthra: The 19th’s “Language for Treating Childhood Obesity Carries Its Own Health Risks to Kids, Experts Say,” by Jennifer Gerson
Victoria Knight: KHN’s “After People on Medicaid Die, Some States Aggressively Seek Repayment From Their Estates,” by Tony Leys
Margot Sanger-Katz: ProPublica’s “How Obamacare Enabled a Multibillion-Dollar Christian Health Care Cash Grab,” by J. David McSwane and Ryan Gabrielson
Also mentioned in this week’s podcast:
- The New York Times’ “The Programs You’d Have to Cut to Balance the Budget,” by Alicia Parlapiano, Margot Sanger-Katz, and Josh Katz
Click to open the transcript
Transcript: Biden Budget Touches All the Bases
KHN’s “What the Health?”Episode Title: Biden Budget Touches All the BasesEpisode Number: 288Published: March 10, 2023
[Editor’s note: This transcript, generated using transcription software, has been lightly edited for style and clarity.]
Julie Rovner: Hello and welcome back to KHN’s “What the Health?” I’m Julie Rovner, chief Washington correspondent at Kaiser Health News. And I’m joined by some of the best and smartest health reporters in Washington. We are taping this week on Friday, March 10, at 10 a.m. As always, news happens fast, and things might have changed by the time you hear this. So here we go. Today we are joined via video conference by Shefali Luthra of The 19th.
Shefali Luthra: Hello.
Rovner: Victoria Knight of Axios News.
Victoria Knight: Hi. Good morning.
Rovner: And Margot Sanger Katz of The New York Times.
Margot Sanger Katz: Hello, everybody.
Rovner: Later in this episode we’ll have my “Bill of the Month” interview with Harris Meyer. It’s a twofer this time: two successive bills from two different families related to having a baby. But first, this week’s news. We are taping on Friday this week because President [Joe] Biden released his budget Thursday afternoon, and it felt weird to have a news podcast without talking about the budget. And yes, like most presidential budgets since the 1980s, this one is, quote-unquote, “dead on arrival” on Capitol Hill. But one thing the president’s budget does is provide a pretty-detailed look at the administration’s priorities and policy initiatives. Which health program stuck out to you as getting a publicity, if not an actual funding, boost in this document? Victoria, you were looking at the budget.
Knight: Yeah. My colleagues at Axios and I spent several hours yesterday morning going through the budget. I think it was really interesting because I think he was trying to toe the line between “we want to save Medicare, make sure it stays solvent,” but also “we want to push some more progressive ideas as well.” So there’s kind of both things in there. Some obvious things: He wants to permanently extend the enhanced tax credits for the ACA [Affordable Care Act] — so, make permanent those subsidies. Those expire, currently, at the end of 2025. He also wanted to do something called Medicaid-like coverage for eligible people in states that haven’t expanded Medicaid. And then he also wants to expand the number of drugs to be negotiated under the IRA [Inflation Reduction Act] and also move up the timeline a little bit. So, just an example: It’s supposed to be 10 drugs to be negotiated in 2026. And now he wants to do 20. Something also really interesting: [He] wants to do like a Netflix-like subscription service for hepatitis C to basically eradicate hepatitis C within the U.S.
Rovner: I thought that was maybe the most interesting thing in this budget because it’s something that we just hadn’t heard of before.
Knight: Yeah.
Rovner: That, basically, I mean, these hepatitis C drugs were really expensive when they first came out and there was concern that Medicaid programs, in particular, were going to have trouble paying for them because many of the people who have hepatitis C are intravenous drug users, and they’re more likely to get hepatitis C — or people in prison. Lots of people on Medicaid who have hepatitis C. And this would basically be a way to pay in advance for the drugs. Is that essentially what they would do?
Knight: Yeah. And I think it’s also interesting that it at least has one Republican senator — Bill Cassidy is super into this idea. He did something similar in Louisiana. I’m not sure there’s other Republicans that are on board for that, but I thought that was really interesting. You know, of course, he was talking about extending the $35 insulin cap to the commercial market. There’s some other stuff about behavioral health, pandemic preparedness. One other thing Shefali will appreciate also, he proposed increasing Title X family planning funding by almost 80% from 2023 levels, which I think — Shefali, maybe you know — [is] one of the highest increases they’ve ever proposed, in a while at least.
Luthra: Yeah, the family planning clinics, interest groups, etc., were very, very happy about this proposal, even if they know it will not become reality. I think their sense was this was a commitment that would be really transformative for them, especially now, when they are so tightly funded.
Rovner: I did notice that for a president who has not technically said that he’s running again, some of these targeted increases were for some of the very important interest groups who have been kind of, I won’t say whining, but complaining. You know, Title X had not gotten big increases since Biden became president. There’s an initiative for more money for home- and community-based care in Medicaid, which is something, again, there’s an active constituency for in the Democratic Party; the “Cancer Moonshot,” you know, which has obviously been something near and dear to President Biden’s heart; also more money … also, the [American] Cancer Society sent out a lot of emails yesterday saying, yay, thanks for proposing this big budget increase. So there does certainly seem to be a lot of touching of the important constituencies, perhaps in anticipation of reelection campaign?
[Three panelists chime in at once.]
Luthra: Julie, you forgot …
Sanger-Katz: I would say …
Knight: And I think he did … Go, Margot!
Rovner: One at a time! [laughing all around] Margot, you go first.
Sanger-Katz: I would say so. And I would also just point out that the Medicare policies in the bill were previewed by the White House a couple of days before the budget release, and they were, like, the main thing. This is what they were leading with. The president had an op-ed in The New York Times describing his Medicare policies, and they put out a fact sheet with a lot of the Medicare policies. And I think it really reflects this notion that improving the solvency of Medicare and also committing to not really cutting the core services of Medicare, that this is a very key political message that the president cares about, that the president wants to run on, and that he thinks is a very useful contrast with what some Republicans have proposed in the past and what he imagines they might want to propose as House Republicans get ready to release their own budget, which faces some difficult constraints because Speaker [Kevin] McCarthy has promised certain members that the budget that they will pass will be a balanced budget. And that’s quite hard to do without touching the big health care programs.
Rovner: Yeah. Republicans have not promised not to touch Medicaid, which now the president has been very careful to say, “It’s not just Medicare and Social Security. I’m not going to let you cut Medicare, the Affordable Care Act either.” All right, Victoria, you wanted to say something?
Knight: I think — it was also interesting that, I do think, the president did want to push forward some of the more progressive policies that … the progressive base care about, such as doing more negotiating of drugs; something Sen. Bernie Sanders (I-Vt.) has talked a lot about is the community health centers program; expanding Medicaid, home- and community-based services; … and the insulin price cap — things that I think the progressive base cares about as well. So I feel like, as you’re saying, that interest groups, but also the different bases and also the groups that care about reproductive health care, they want him to do something after Roe v. Wade. So it definitely was, like, this huge list of trying to cater to everyone.
Rovner: It’s kind of a Democratic wish list.
Sanger-Katz: At the same time, though, I think he did leave out some of the things that were part of the Build Back Better package. In the previous budgets, the president had gone even bigger on things that the progressive base wanted. And you can see a lot of things in this budget where he’s ticking those boxes, as you say. And I think a lot of policies that he has proposed in the past that he wasn’t able to get through the last Congress — but not all. It does seem like this budget is a little more focused on being able to reduce the deficit a little bit less on this very expansive notion of a robust federal government that is spending money to improve people’s lives in quite as many ways as the message that he has been proposing in his previous budgets. You can see, again, I think this is a pivot towards campaign mode, towards his assessment of the current political moment, growing concerns about the deficit and about inflation.
Rovner: But also, as you mentioned, Margot, they put out the Medicare part of this in advance, mainly because I feel like the Medicare part of the budget is not so much a part of, you know, the statement of the budget as it is a negotiating position for this whole fight we’re going to have over the debt ceiling in a couple of months, where the Republicans are going to want to demand cuts to programs basically in exchange for not letting the U.S. default on its debts. And what the president has managed to do here is say, “We’re going to lower the price of prescription drugs more, we’re going to tax the rich more. And those two things are going to a) reduce the deficit some and b) shore up the Medicare trust fund. So you can’t accuse me of not dealing with the impending problem of Medicare.” How much of a box does that actually put Republicans in when we start to get to these negotiations?
Sanger-Katz: I don’t know how much of a box it really puts them in for a couple of reasons. One is that some of what he’s proposing is really kind of an accounting gimmick. He’s taking money that is already flowing into the federal budget, that is already part of the dollars and cents of our deficit, and he’s just redirecting them from the general fund into the Medicare trust fund. So it is true that these proposals would extend the solvency of the Medicare Hospital Insurance Trust Fund, which is projected to run into some financial trouble in the coming decade. But it is not true that, like, all of the things that he’s proposing are actually new money. Some of it just comes out of other parts of the budget. It doesn’t change the deficit.
Rovner: So I will point out that that is a time honored way of extending the solvency of trusts.
Sanger-Katz: Oh, sure. I’m not saying that Biden is alone in doing that. But I just think there’s kind of three things he’s doing in this proposal. One of them is not deficit reduction. It’s just kind of moving money around. One is this drug price reduction proposal where he’s trying to get more savings by going more aggressively after more drugs. I think that is a place where he can put Republicans in a box a little bit. They’ve come out in opposition to the drug price negotiation provisions that were part of the Inflation Reduction Act that they passed last year. But those policies are super popular. The public really supports them. They feel like the pharmaceutical companies make too much money. They think that Medicare should be able to negotiate. So I think that’s a very politically shrewd decision that I think does demand potentially a response from Republicans as a possibility for deficit reduction. But then the third thing that he did is he really just raised taxes. You know, these are taxes on the rich; as Biden has been promising all along, he’s not going to raise taxes for people earning under $400,000 a year. So they’ve increased these payroll taxes, they’ve increased some investment taxes. There was kind of a loophole, a category of businesses that were not subject to that tax in the past. And, you know, I think those are basically nonstarters with Republicans. And when Republicans talk about deficit reduction, they often are very, very focused on cutting spending that the federal government does. They are much less interested in increasing taxes. And I do think that the fact that Biden led with this proposal, that he’s so comfortable talking about raising taxes as a core part of his platform, is a sign that the politics of tax cuts have changed a little bit, that that is … if you’re just taxing the rich, it seems like the public will accept that. Democrats seem actually excited about that in certain cases. But I still think tax increases are a hard political row to hoe. I think that it is not something that probably appeals to many Republican politicians. And I also think it’s probably not something that appeals to many Republican voters, either. So I don’t know that it really puts Republicans in a box in a meaningful way because they don’t feel any tension where their supporters will want them to do this thing.
Rovner: Obviously, this is a big fight yet to come. Victoria, you wanted to say something.
Knight: Yeah. I just want to add one thing. We did have, like, the first indicator: The House Freedom Caucus had a press conference this morning, and they didn’t give a lot of details, but they did say they want to restore Clinton-era work requirements for welfare programs. So they didn’t specify Medicaid, but it seems pretty likely that’s probably what they’re talking about. My colleagues and I did talk to some Republicans last week that were indicating they did want work requirements for Medicaid. So I think that seems like the very first. There’s going to be three different groups within the House Republican caucus that are going to release budgets: the Budget Committee, the House Freedom Caucus, the Republican Study Committee. So I think we are going to start seeing the outlines of what they want to do very soon. But that was kind of the first one coming out this morning, so …
Rovner: Yes, underscoring the fact that the Republicans don’t agree on what they want to do …
Knight: No.
Rovner: … which is why we haven’t seen their budget yet.
Knight: Exactly.
Rovner: Although I will point out President Biden’s budget was a month late, too.
Sanger-Katz: Can I just say one thing about the Republican budget? Because I actually spent a lot of time looking at various budget proposals and trying to examine this goal that the Republicans have of balancing the budget. Just like: How hard is it to balance the budget? And it turns out that it’s extremely hard. It’s sort of hard in a normal year. But in this post-covid era, when spending has been so elevated for so long, balancing the budget within a decade is just really, really, really hard. If you do it without raising taxes, which Republicans say they don’t want to raise taxes; if you do it without cutting defense spending, which Republicans say they don’t want to cut defense spending; if you do it without cutting Medicare or Social Security, which recently McCarthy has said he does not want to do — you end up just … this is just the basic math … having to cut everything else by 70%. That’s 7-0%. That is not the kind of cut that you can achieve even by imposing a work requirement on Medicaid, a work requirement on food stamps, and other kinds of policies that Republicans have proposed in the past. That is like deeply, deeply reducing the role of the federal government, you know, cutting Medicaid in more than half. Larry Levitt [KFF’s executive vice president for health policy] pointed out earlier this week reducing Medicaid spending by 70% probably means 50 million fewer people would have Medicaid coverage. And that’s just Medicaid. You’re talking about basically everything that the government does — environmental protection, law enforcement, military pensions, just about any program that you can think about in the government that’s not Medicare, Social Security, or direct defense spending. Seventy percent cut is quite hard to do. And so I am very curious to see what these budgets look like. I can tell you, having looked at some of the previous Republican proposals, that those all relied on some reductions to Medicare and Social Security because those programs represent such a large percentage of federal spending that if you don’t cut those at all, there’s just not a lot of dollars left. And in my reporting on this question, it does seem like one thing that the Republican Budget Committee is very likely to do is to use very aggressive assumptions about the economic growth that their policies will unleash. And so the idea is that if the economy grows by so much, then tax revenue, what increase all by itself, because people will be earning more money, and so that will enable them to balance the budget in 10 years without having to actually reduce the deficit by as much as independent scorekeepers like the Congressional Budget Office think would be necessary.
Rovner: Although I would point out that every time we’ve had one of these big tax cuts that Republicans say it’s going to grow the economy enough to pay for it, it has not grown the economy enough to pay for it.
Sanger-Katz: Indeed! You know, cutting everything that the government does by 70% probably actually would have a negative impact on the economy. People would be losing money. They would be losing their government jobs. These would be very large economic impacts that probably most economists do not think would lead to economic growth.
Rovner: Yeah, well, we will see. I will put, Margot, the nice story you did with your colleagues demonstrating all of this in chart form in the show notes. OK. Let us turn to abortion. We will start with Walgreens, poor Walgreens, caught in the maw of the abortion wars. In January, the FDA said that brick-and-mortar pharmacies for the first time could start dispensing the abortion pill, mifepristone, whose distribution had been tightly regulated since it was first approved more than 20 years ago. Almost immediately, both CVS and Walgreens, the country’s largest and second-largest pharmacy chains, announced they would apply for FDA certification to distribute the pills in states where abortion is still legal. Then, last month, 20 Republican state attorneys general, including at least four in states where abortion is still legal, warned CVS and Walgreens that if they send the pills by mail, they could be in violation of the 1873 Comstock Act, which we have talked about here before, which prohibited the mailing of items considered, air quotes, “obscene,” which at the time included information about birth control. Cut to last week when Walgreens appeared to cave to the pressure and the threat of legal action, saying it would not sell the pill in states where it’s illegal, not actually naming those states. Then, after a huge backlash, it tried to walk back its position a little, mostly leaving lots of questions. Shefali, what is your take on what Walgreens is and isn’t going to do now vis-a-vis mifepristone? They’ve kind of said both things.
Luthra: I think there’s a lot of layers here, but I want to go back to January for a moment, when we got that news from Walgreens and CVS so quickly that they would participate in providing mifepristone. Frankly, a lot of these folks that I spoke to were very surprised that [the pharmacies] reacted so quickly because carrying mifepristone in stock opens you up to really intense harassment, boycotts, protests from the anti-abortion movement. And we did see right away many of the premier anti-abortion movements calling for boycotts of Walgreens and CVS, for protests, etc. They have been organizing protests outside pharmacies right now. And there has been pressure from the beginning from governors like [Florida] Gov. Ron DeSantis instructing pharmacies not to stock the press down. The fact that Walgreens ultimately has caved in these states with hostile governments wasn’t surprising. If anything, it was surprising that it took quite so long. I am incredibly curious to see what happens with CVS and Rite Aid, the other two pharmacies that are now getting caught in the crosshairs, facing really intense pressure from lawmakers and politicians who support abortion access and also those who don’t. We saw in New York this week, the governor and the attorney general called on pharmacies to continue carrying mifepristone. Frankly, I’m skeptical that that really matters because there is no reason not to carry mifepristone in New York, a state where the government is very friendly to abortion.
Rovner: And we should point out, because this is my biggest frustration: Nobody’s actually doing it yet because nobody’s gotten certified yet.
Luthra: Correct.
Rovner: They’re not — all these headlines that said, “Walgreens is going to stop doing this.” It’s like, no, they’re going to not start doing this. Sorry.
Luthra: And we have no idea when they will get certified how long it would take. We have no idea, frankly, if mifepristone will still be able to be distributed in the country at that point, because we are still waiting on the ruling from this judge in Texas. We simply have so many open questions. And at this point, this really is more of an avenue for people to make statements about how they feel about abortion access, than it is actually affecting people’s ability to get care. The other statement grandstanding that I have been really struck by is what we’ve seen from the California governor, Gavin Newsom, who really does love to talk a lot about his pro-abortion rights bona fides, even if those statements don’t translate much into actual impact or policy. And what we saw this week was his promise that California wouldn’t do business with Walgreens if they wouldn’t stock mifepristone.
Rovner: And this is not just an idle threat in California, right? There’s a huge contract that he now says he’s not going to renew.
Luthra: So there is a contract. But friend of the podcast and former KHNer Sydney Lumpkin found the contract that Newsom was referring to. You would think it would be a significant amount of money, given how much attention it has gotten. It is a $54 million contract over five years. When you look at the overall market cap of Walgreens, a $30 billion company, it’s not clear exactly how meaningful that actually is compared to the pressure they are facing from lawsuits and the very powerful anti-abortion movement.
Rovner: So, and what … I mean, you referred to this, but what are we thinking that CVS and Rite Aid are going to do — having seen Walgreens literally put through the wringer here on this issue?
Luthra: I think that’s a really good question. I — I mean, coming into this week — had assumed that they would follow the path of Walgreens and do the exact same thing, right? Stock mifepristone, provide it with a doctor’s prescription in states where they are protected and face no legal risks, but perhaps not do so in those states where a) mifepristone is banned, as they have said they would not do. And also in states where, like Kansas, for instance, abortion is legal, but you have a very anti-abortion attorney general. It is quite interesting that they have not said either way what they will do beyond just, well we won’t do it in states where it’s illegal.
Rovner: Yeah, if I was advising CVS at this point, I would tell them to not say a word to anybody until some of this shakes out.
Luthra: Exactly.
Rovner: All right. Well, let us move on to Texas, where there is always abortion news. As Shefali mentioned, we have not had the decision yet on that abortion pill case out of Amarillo, but both sides are still going at it on other issues. Remember all those stories we’ve been chronicling about women with wanted pregnancies gone wrong who couldn’t get medical care until they were literally at death’s door or they went to another state? Well, five of them are suing the state of Texas, saying they should have been allowed to terminate their pregnancies under existing exceptions to the abortion bans, except that doctors and hospitals have been unwilling to risk giant fines and even jail time. The five women — some of whom are still pregnant, some of whom are not — want the state, whose officials continue to claim that these women were eligible for abortions in Texas if their lives were truly at risk, they want the state to clarify those exceptions even more. Is there any chance this happens? They’re not asking for the bans to be lifted. I mean, this is a kind of a unique lawsuit that we’ve not seen before because we’ve not seen that many women in this situation before.
Luthra: I think this is a pretty smart approach. I wouldn’t be surprised if it has better odds of success than, as you mentioned, a request to fully overturn Texas’ abortion bans because the exceptions are really unclear. Doctors do not feel safe talking about abortion, even in cases where it is likely that it would be very beneficial for the pregnant person, for a fetus that has really minimal chance of survival upon birth. One thing that Nancy Northup, the head of CRR [the Center for Reproductive Rights], said to me when I asked her is, depending on how this case goes, it is not at all unlikely that we see similar lawsuits filed in other states with abortion bans with similarly vague “life of the parent” exceptions that are, in reality, impossible to enforce. I think this is going to be the beginning of a very robust series of legal challenges to state abortion bans. And we’ll see better success for abortion rights lawyers in some states than in others — really depending on the makeup of these different states’ supreme courts.
Rovner: Yeah, I mean, it’s funny because over the years I’ve heard obviously lots of warning about this possibility, both from the Center for Reproductive Rights, which, as you say, is pushing this case, and other groups. But nobody could sue because nobody had standing, because it hadn’t happened. It was all theoretical. Well, now it’s happened and we have people to whom it is not theoretical, who are able to go to court and say, hey, this happened to us and it violated our rights and you need to do something about it.
Luthra: And I do want to add just one thing. I mean, it’s — I think we can’t understate just what these people have been through, the women who are suing Texas. I was just really struck by one woman who flew from Texas to Colorado for an abortion that she couldn’t get in state, paid extra for a seat by the airplane in case she went into labor on the flight, and said that she still has PTSD to this day from having to travel while afraid that she might go into labor and could die from it. Like, what these people are going through right now is just … it’s really difficult for us to imagine. And I think we’re just going to hear so many more stories that are really troubling about people whose lives have been so deeply put at risk, and they’re unable to get the care their doctors want to provide.
Rovner: Right. And I say for the 11th time, these are not women who got pregnant by accident and don’t wish to be pregnant. Many of these are women who’ve been through infertility treatment and were desperately anxious to be pregnant, were thrilled when they got pregnant, but whose pregnancy took a bad turn either for the fetus or, in some cases, one of the fetuses of twins, or in some cases the pregnant person themselves. Well, meanwhile, the Texas Republican legislature has been busy proposing even more abortion restrictions. Last week, we talked about a bill that would ban websites that include information about how to get abortion pills and punish internet providers who don’t block those sites. This week, we have a bill giving state officials the upper hand in prosecuting abortion cases in parts of the state where local Democratic prosecutors have suggested they don’t plan to zealously pursue such cases. Another bill would create a special prosecutor whose job would be, among other things, to pursue violations of the state’s abortion bans. Why is Texas such a hotbed of this?
Luthra: It’s always Texas. Texas is the biggest state in the country to have banned abortion, right? Most of the people who are traveling out of state — well, maybe not most, but the plurality — are Texans, because just so many people live there. And if we think about it, Roe v. Wade, as a case, it came from Texas. SB 8, the first law that allowed a state to circumvent Roe and ban abortions [at] anything after six weeks, that was a Texas law. This is a place where lawmakers really believe that they can be a fertile testing ground for the future of abortion restrictions. Between them and Missouri, I think, that is where we will see the bulk of innovative new ways to further restrict access.
Rovner: Well, speaking of big states that are banning or thinking about banning abortion, you wrote about Florida this week, which already has a ban on abortions after 15 weeks [and is] now considering a ban after six weeks. Florida is kind of a pivotal state in all this, right?
Luthra: Florida, third-biggest state in the country. And if we look at the map of the U.S. South and particularly the Southeast, Florida is just critical. Between Florida and North Carolina, that is where people across the region are going for abortions. And Florida has more than 60 clinics compared to, you know, around a dozen in North Carolina. If abortion there is banned after six weeks, there will be thousands of people who are displaced. They will probably have to go to North Carolina, while abortion is legal there, to Virginia and then to Illinois. And that is just really too far for so many people to travel. There just aren’t realistic options once you take Florida off the map.
Rovner: Well, finally, a bill has been introduced in the South Carolina legislature that could potentially subject patients who get abortions to the death penalty. Now, I am old enough to remember last year, when anti-abortion groups insisted they didn’t want to punish women who had abortions, just those who provide or facilitate them. I guess that’s not the case anymore.
Luthra: And I think we need to see where this bill goes. It is not the only state, either, where we are seeing legislation proposed that would treat abortion as murder or as homicide. There was a bill in Louisiana just last summer that failed on that front. But we have seen bills introduced in Tennessee, in Georgia, in so many others that I cannot remember now. But it’s a long list. I think what’s interesting is, so far, none of these bills have actually moved forward. And it’s still obviously early in the session. But what I’m curious about is, is this chipping away at the resistance toward these kinds of really strict abortion bans? And is this the first step in a multiyear effort to redirect who is punished for getting an abortion to switch from the doctors, the health care providers, to the pregnant people themselves, which has always been sort of this Rubicon the movement has been afraid to cross.
Rovner: Yeah, I remember in 2016 Chris Matthews was interviewing then-candidate Donald Trump and sort of got Donald Trump to say, you know, yes, the woman should be punished. And the anti-abortion movement came at him, like, no, no, no, that’s not what we say. That’s not what we want. And now it’s, you know, seven, eight years later and that’s not necessarily what people are saying. So, we will see how that goes. OK. That’s the news for this week. Now, we will play my “Bill of the Month” interview with Harris Meyer and then we’ll come back and do her extra credits.
We are pleased to welcome to the podcast Harris Meyer, who reported and wrote the last two KHN-NPR “Bill of the Month” stories, which are kind of related. Harris, welcome to “What the Health?”
Harris Meyer: Thanks very much, Julie.
Rovner: So, both of these bills have to do with something very common and very treacherous to your financial health: having a baby. Let’s start with baby No. 1, a now-3-year-old named Joey Trumble. Where is she from? Why was she in the hospital for 36 days?
Meyer: Joey was born prematurely in December 2019. Her mother, Brenna Kearney, is a writer in Chicago, and she was diagnosed with preeclampsia, and her doctors ordered her hospitalized at Northwestern. And then she developed a worse form of preeclampsia called HELLP syndrome. But anyway, the baby was born healthy but premature. And the baby, Joey, was treated at Northwestern Prentice, but without the knowledge of the parents the doctors who were treating her came over from next door from Lurie Children’s, and her hospital, Northwestern, was in network for her health plan. But Lurie Children’s doctors were out of network. They did not know that. So after her baby was sent home — it had about a month, 36 days, of hospitalization — the family got a bill of about $12,000, which was unexpected.
Rovner: That’s right. And we should point out that the baby was covered, right, under the mother’s health insurance.
Meyer: Correct.
Rovner: And yet they still got a bill for $12,000.
Meyer: That’s right. The hospitalization was covered. And, to their surprise, the doctors, the neonatologist from Lurie who treated the baby, were not covered in network. And so Brenna spent the next year contesting these charges. And they were never told that the doctors were out of the network. But she had found out that there was a 2011 Illinois law, which was in effect, which prohibited this kind of out-of-network billing for neonatology services.
Rovner: That’s right. And we should point out that this was before the federal No Surprises Act took effect, because this was late 2019.
Meyer: Correct.
Rovner: But there was a state law that should have applied.
Meyer: There was a state law. Illinois was a pioneer in this. So she cited that law to Blue Cross Blue Shield Illinois and to Lurie Children’s, and they said they knew nothing about it. So the bill was sent to collections about a year later, and she was able to get Blue Cross, finally, and, a year after the birth, to cover the Lurie doctor charges fully. However, in December, three years after she gave birth, she finds out she’s being billed again, after she thought the whole ordeal was over — many years after. And she finds out that Blue Cross of Illinois had taken the money back and now Lurie was coming after her and her husband again for the out-of-network charges. And that’s when she came to Kaiser Health News, and I made calls to Lurie, to Blue Cross of Illinois, and to Northwestern. And after my calls, Lurie agreed to drop the charges. But now a state senator, the Illinois Department of Insurance, and the Illinois attorney general are looking into this to see if there was a long pattern of violations by Lurie of this 2011 state law. And Brenna actually has been contacted now by three other women who experienced similar out-of-network bills from Lurie. So we’ll see what happens with that.
Rovner: So sort of a happy ending to that one. Let’s move to baby No. 2, or, more accurately, his mother. Who is she and what happened to her?
Meyer: OK. This was last June. Danielle Laskey is a school nurse, an RN, in Seattle. She was on vacation with the family. And at 26 weeks pregnant she felt that her water broke. Her doctors in Seattle ordered her to come back and said, you’d better come in. And her doctors were at Swedish Maternal & Fetal Specialty Center in Seattle, which was in network for her Blue Shield health plan. And when she got there, they said, yes, your water broke. You were at risk for the same complication from your first pregnancy three years ago. We want you to go to Swedish Medical Center across the street immediately, and we want you to stay there until you give birth, and we’ll monitor you. So she was in the hospital for seven weeks until she gave birth in August of last year.
Rovner: Oh, so just for context, Swedish is one of the big hospitals in Seattle, right?
Meyer: Yes, absolutely. And it’s one of the specialty facilities for this particular uncommon complication, which is called placenta accreta. Anyway, she was there for seven weeks. And again, she and her husband were not told that the hospital was out of network. But it turns out that Swedish, even though her doctors were — her Swedish doctors were in network for her health plan, it turns out that Swedish Medical Center was out of network, and she found out. Then the baby was born. The baby was in the hospital, the baby boy, for about a month. And then, meanwhile, after the baby was born, she experienced symptoms again, and she was rehospitalized for a day to have this placenta condition treated. Both those hospitalizations — you know, she and her husband, who’s a psychiatrist, thought they were emergencies. The doctors regarded them as emergencies. But yet afterward, the Regence Blue Shield and Swedish decided they were not emergencies. And so, guess what? The family was hit with over $100,000 in out-of-network bills for the two Swedish hospitalizations.
Rovner: And this was after the federal law took effect, right? This was last year.
Meyer: The federal law and a Washington state law were both in effect at that point, which say that you cannot apply out-of-network charges in an emergency situation. So, at first, Blue Shield said that it was not an emergency and it didn’t come under the law. And Swedish Medical Center was going to take the family to collections. The family appealed to Regence Blue Shield. Regence in January granted the appeal for the first hospitalization, erasing $100,000 or so of the charges. But the second hospitalization, $15,000 bill, was still in effect. And then they contacted Kaiser Health News. I contacted Regence Blue Shield and Swedish, and then the charges were dropped for the second hospitalization.
Rovner: Amazing how that happens.
Meyer: Yeah, well, it’s not a solution. So the twist on this one is that Regence Blue Shield said we decided it was an emergency and that it wasn’t proper that the doctors were in network but the hospital wasn’t, so we’re going to consider this an in network and erase the charges. But they said Regence Blue Shield had a contract with Swedish, which made Swedish a quote-unquote “participating provider”; therefore, the federal and state laws do not apply to that situation, and the hospital was allowed to charge the out-of-network charge. We’re going to erase it for this case, but the law does not apply to that situation.
Rovner: I confess, if I’m in a hospital and they say they’re a participating provider, I’m going to assume that means they’re in network. And in this case, it doesn’t, right?
Meyer: Right. It’s a very strange twist that my experts had never encountered before. I took the issue to the federal agency CMS, which administers the No Surprises Act, and they said that they’re going to look into this and HHS, Treasury Department, and Department of Labor are all going to have to look into this to see if this could be fixed through an agency guidance or whether this would require a congressional action to fix this apparent loophole in the law.
Rovner: Creativity. So what’s the takeaway here for both women and particularly for pregnant women who know at some point they’re likely to be in the hospital? You can’t ask every single person who touches you whether they’re in your network. And isn’t that what state and the federal law are supposed to guard against? These are the exact things that we assumed would be taken care of. Right?
Meyer: Right. Well, first of all, the family, the patient, and their loved ones need to ask the hospital and the insurer to tell them their rights under the No Surprises Act and make sure that both the insurer and the provider are following the letter of those federal and state laws. Second, if they do get, God forbid, a out-of-network bill, they need to immediately appeal that to the insurance company, and there’s a two-level appeal process. The second level, they get an independent review. And then, at the same time, they need to file a report or a complaint with the state attorney general’s office, the state department of insurance, and maybe even contact state legislators. There also are private agencies or private companies with nurses and lawyers, etc., that will help families, for a fee, address issues like this. Hopefully it shouldn’t require that, but sometimes it may. And of course, then there’s Kaiser Health News. You can file your “Bill of the Month” complaint through the portal, which we can’t deal with hundreds of thousands of cases, obviously.
Rovner: But we can help at least a few. And Harris Meyer, you helped two. So thank you very much. And thank you for joining us.
Meyer: Thank you, Julie.
Rovner: OK, we’re back. And now it’s time for our extra-credit segment. That’s when we each recommend a story we read this week we think you should read, too. As always, don’t worry if you miss it. We will post the links on the podcast page at khn.org and in our show notes on your phone or other mobile device. Victoria, why don’t you go first this week? You got one of my favorites.
Knight: My extra credit is called “They Could Lose the House — to Medicaid,” by Tony Leys, and it is published on NPR but is a KHN story. It’s about a family in Iowa who found out, after the mother in the family died, that they could lose their house because she was getting services through Medicaid. She had dementia, and so she needed really intensive at-home family care. Then after she died, they got a letter from the Iowa Department of Human Services — just a month after she died, so not long after — saying that the state was trying to recoup the money that they had spent on her care. So it was almost over $200,000 that they were asking for. And what was really upsetting is this family home was going to be the inheritance for the daughter. And so now they’re kind of like, what are we going to do? Thankfully, they don’t have to do anything with the house until something happens to the father. So it’s not gone immediately. But this is basically something that some states do. It’s called estate recovery programs. And if people use Medicaid in those states, the states have the ability to come back later … whether it’s, like, a house or they can ask for funds that these families used for Medicaid. So it’s really illuminating. I had no idea this was something that happened, and it varies by state to state. But in Iowa, this is something that they kind of pursue very aggressively.
Rovner: I remember when Congress made this a possibility, I think it was back in 1995. It’s been around, the possibility of states recouping Medicaid money for a long time. But as you point out, not all states do it. And it’s usually a surprise when states do do it. People still really don’t know about it. Shefali.
Luthra: So my story is from my 19th colleague, Jennifer Gerson. The headline is “Language for Treating Childhood Obesity Carries Its Own Health Risks to Kids, Experts Say.” And what Jen did, which I think is really smart and important, is she looked at the new clinical guidelines we got from the American Academy of Pediatrics. And those were meant to improve how we evaluate and treat obesity in children. And what she gets into is that there are a lot of children’s health experts, especially mental health experts, who are deeply concerned about what the impacts of these new guidelines could be, how they might exacerbate weight stigma, and how the long-term ramifications of some of the treatment guidelines could actually have worse outcomes for young people as a result, by building on weight stigma, which could lead to different kinds of unhealthy behaviors, could lead to mental health harms that could have much longer term repercussions, possibly more, in fact, dangerous than the actual problems that these guidelines are trying to treat. And one thing that Jen notes I think is really important is that the implications of weight stigma, in particular, are especially harmful for young girls who, as we know, are already facing so many mental health crises in general right now. I thought this was a really important look at a potentially really troubling unintended consequence, and I’m really glad Jen wrote about it.
Rovner: Yeah, I had no idea. It was a very counterintuitive but really interesting piece. Margot, what do you have this week?
Sanger-Katz: I wanted to suggest an article in ProPublica called “How Obamacare Enabled a Multibillion-Dollar Christian Health Care Cash Grab,” by J. David McSwane and Ryan Gabrielson which is just this wonderful historic dive into how the Affordable Care Act ended up allowing something called Christian health ministries to provide an alternative to health insurance. As we all know, the Affordable Care Act basically said, if you’re going to offer health insurance, it has to meet certain minimum guidelines in terms of what it covers and how it works. And these Christian health sharing ministries are just this huge, huge exception where basically it’s just, you know, groups of religiously affiliated people can get together and just pay for each other’s health care or not, depending on what they want to do. There has been a lot of reporting over the years about the degree to which these plans are kind of scammy or poorly run or are not paying for needed health care for their members who think that they are an alternative to insurance. And so this piece is just fun because it looked at the lobbying that generated this strange policy.
Rovner: Yeah. You know, I remember when they got the Christian sharing ministries exception into the ACA and not really knowing where it came from. Well, this story explains exactly where it came from. So it is quite an eye-popping read. Mine is from my KHN colleague Sarah Varney, and it’s called “Girls in Texas Could Get Birth Control at Federal Clinics, Until a Christian Father Objected. Now, for decades, underage girls have been able to get contraception from federally funded Title X family planning clinics without parental permission. An effort by the Reagan administration in the early 1980s, dubbed the “Squeal Rule,” which would have required that parents be notified after the fact, was struck down in federal court and the Reagan administration did not appeal it. And no, I was not there to cover that at that time. I did look it up. A couple of months ago, Judge Matthew Kacsmaryk — yes, that Judge Kacsmaryk, who will any day now rule on whether the FDA approval of the abortion pill should be revoked — ruled in favor of a father in Texas, not a father whose daughters did or said they wanted to obtain contraception from a Title X clinic. But the father complained that the very possibility that his daughters could get birth control without his consent rendered that portion of the law — which has been in effect since Title X, was signed by Richard Nixon in 1970 — unconstitutional. And of course, the judge agreed with him. So for now, the ruling only applies in Texas. But lest you think they’re not coming for your birth control, think again.
OK. That is our show for this week. As always, if you enjoy the podcast, you can subscribe wherever you get your podcasts. We’d appreciate it if you left us a review — that helps other people find us, too. Special thanks, as always, to our ever-patient producer, Francis Ying. Also, as always, you can email us your comments or questions. We’re at whatthehealth — all one word — @kff.org. Or you can tweet me. I’m @jrovner. Shefali?
Luthra: I’m @shefalil
Rovner: Victoria.
Knight: @victoriaregisk
Rovner: Margot.
Sanger-Katz: @sangerkatz
Rovner: We will be back in your feed next week. Until then, be healthy.
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March Medicaid Madness
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Julie Rovner
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Julie Rovner is chief Washington correspondent and host of KHN’s weekly health policy news podcast, “What the Health?” A noted expert on health policy issues, Julie is the author of the critically praised reference book “Health Care Politics and Policy A to Z,” now in its third edition.
With Medicare and Social Security apparently off the table for federal budget cuts, the focus has turned to Medicaid, the federal-state health program for those with low incomes. President Joe Biden has made it clear he wants to protect the program, along with the Affordable Care Act, but Republicans will likely propose cuts to both when they present a proposed budget in the next several weeks.
Meanwhile, confusion over abortion restrictions continues, particularly at the FDA. One lawsuit in Texas calls for a federal judge to temporarily halt distribution of the abortion pill mifepristone. A separate suit, though, asks a different federal judge to temporarily make the drug easier to get, by removing some of the FDA’s safety restrictions.
This week’s panelists are Julie Rovner of Kaiser Health News, Alice Miranda Ollstein of Politico, Rachel Cohrs of STAT News, and Lauren Weber of The Washington Post.
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Rachel Cohrs
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Alice Miranda Ollstein
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Lauren Weber
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Among the takeaways from this week’s episode:
- States are working to review Medicaid eligibility for millions of people as pandemic-era coverage rules lapse at the end of March, amid fears that many Americans kicked off Medicaid who are eligible for free or near-free coverage under the ACA won’t know their options and will go uninsured.
- Biden promised this week to stop Republicans from “gutting” Medicaid and the ACA. But not all Republicans are on board with cuts to Medicaid. Between the party’s narrow majority in the House and the fact that Medicaid pays for nursing homes for many seniors, cutting the program is a politically dicey move.
- A national group that pushed the use of ivermectin to treat covid-19 is now hyping the drug as a treatment for flu and RSV — despite a lack of clinical evidence to support their claims that it is effective against any of those illnesses. Nonetheless, there is a movement of people, many of them doctors, who believe ivermectin works.
- In reproductive health news, a federal judge recently ruled that a Texas law cannot be used to prosecute groups that help women travel out of state to obtain abortions. And the abortion issue has highlighted the role of attorneys general around the country — politicizing a formerly nonpartisan state post. –And Eli Lilly announced plans to cut the price of some insulin products and cap out-of-pocket costs, though their reasons may not be completely altruistic: An expert pointed out that a change to Medicaid rebates next year means drugmakers soon will have to pay the government every time a patient fills a prescription for insulin, meaning Eli Lilly’s plan could save the company money.
Plus, for “extra credit,” the panelists suggest health policy stories they read this week that they think you should read, too:
Julie Rovner: The New York Times’ “A Drug Company Exploited a Safety Requirement to Make Money,” by Rebecca Robbins.
Alice Miranda Ollstein: The New York Times’ “Alone and Exploited, Migrant Children Work Brutal Jobs Across the U.S.,” by Hannah Dreier.
Rachel Cohrs: STAT News’ “Nonprofit Hospitals Are Failing Americans. Their Boards May Be a Reason Why,” by Sanjay Kishore and Suhas Gondi.
Lauren Weber: KHN and CBS News’ “This Dental Device Was Sold to Fix Patients’ Jaws. Lawsuits Claim It Wrecked Their Teeth,” by Brett Kelman and Anna Werner.
Also mentioned in this week’s podcast:
- Politico’s “Why One State’s Plan to Unwind a Covid-Era Medicaid Rule Is Raising Red Flags,” by Megan Messerly.
- The Washington Post’s “Doctors Who Touted Ivermectin as Covid Fix Now Pushing It for Flu, RSV,” by Lauren Weber.
- NPR’s “To Safeguard Healthy Twins in Utero, She Had to ‘Escape’ Texas for Abortion Procedure,” by Selena Simmons-Duffin.
- The Daily Beast’s “Tennessee Abortion Ban a ‘Nightmare’ for Woman With Doomed Pregnancy,” by Michael Daly.
click to open the transcript
Transcript: March Medicaid Madness
KHN’s ‘What the Health?’Episode Title: Medicaid March MadnessEpisode Number: 287Published: March 2, 2023
Julie Rovner: Hello and welcome back to KHN’s “What the Health?” I’m Julie Rovner, chief Washington correspondent at Kaiser Health News. And I’m joined by some of the best and smartest health reporters in Washington. We are taping this week on Thursday, March 2, at 10 a.m. As always, news happens fast, and things might have changed by the time you hear this. So, here we go. We are joined today via video conference by Alice Miranda Ollstein of Politico.
Alice Miranda Ollstein: Good morning.
Rovner: Rachel Cohrs of Stat News.
Rachel Cohrs: Hi, everybody.
Rovner: And we officially welcome to the podcast panel this week Lauren Weber, ex of KHN and now at The Washington Post covering a cool new beat on health and science disinformation. Lauren, welcome back to the podcast.
Lauren Weber: Thanks for having me.
Rovner: So we’re going to get right to this week’s news. We’ve talked a lot about the political fight swirling around Medicare the past couple of weeks. So this week, I want to talk more about Medicaid. Our regular listeners will know, or should know, that states are beginning to re-determine eligibility for people who got on Medicaid during the covid pandemic and were allowed to stay on until now. In fact, Arkansas is vowing to re-determine eligibility for half a million people over the next six months. Alice, the last time Arkansas tried to do something bureaucratically complicated with Medicaid, it didn’t turn out so well, did it?
Ollstein: No. It was so much of a cautionary tale that no other state until now has gone down that path, although now at least a couple are attempting to. So Arkansas was the only state to actually move forward under the Trump administration with implementing Medicaid work requirements. And we covered it at the time, and just thousands and thousands of people lost coverage who should have qualified. They were working. They just couldn’t navigate the reporting system. Part of the problem was that you had to report your working hours online and a lot of people who are poor don’t have access to the internet. And, you know, the system was buggy and clunky and it was just a huge mess. But that is not stopping the state from trying again on several fronts. One, they want to do Medicaid work requirements again. The governor, Sarah Huckabee Sanders, has said that they plan to do that and also they plan to do their redeterminations for the end of the public health emergency in half the time the federal government would like states to take to do it. The federal government has incentives for states to go slow and take a full year to make sure people know how to prove whether or not they qualify for Medicaid and to learn what other insurance coverage options might be available to them. For instance, you know, Obamacare plans that are free or almost free.
Rovner: Yeah. Presumably most of the people who are no longer eligible for Medicaid but are still low-income will be eligible for Obamacare with hefty subsidies.
Ollstein: That’s right. So the fear is that history will repeat itself. A lot of people who should be covered will be dropped from coverage and won’t even know it because the state didn’t take the time to contact people and seek them out.
Rovner: This is something that we will certainly follow as it plays out over the next year. More broadly, though, there have been whispers — well, more than whispers, whines — over the past couple of weeks that President [Joe] Biden’s challenge to Republicans not to cut Social Security and Medicare, and Republicans’ apparent acceptance of that challenge, specifically leaves out Medicaid. Now, I never thought that was true, at least for the Democrats. But earlier this week, President Biden extended his promises to Medicaid and the Affordable Care Act. How much of a threat is there really to Medicaid in the coming budget battles? Rachel, you wrote about that today.
Cohrs: There is a lot of anxiety swirling around this on the Hill. I know there’s a former Trump White House official who’s circulated some documents that are making people a little bit nervous about Republicans’ position. But it is useful to look at existing documents out there. It is not reflective necessarily of the consensus Republican position. And it’s a very diverse party right now in the House. They have an incredibly narrow majority and Kevin McCarthy is really going to have to walk a tightrope here. And I think it is important to remember that when Medicaid has come up on steep ballot initiatives in red states, so many times it has passed overwhelmingly. So I think there is an argument to be made that Medicaid enjoys more political support among the GOP voting populace than maybe it does among members of Congress. So I think I am viewing it with caution. You know, obviously, it’s something that we’re going to have to be tracking and watching as these negotiations develop. But Democrats still hold the Senate and they still hold the presidency. So Republicans have more leverage than they did last Congress, but they’re still … Democrats still have a lot of sway here.
Rovner: Although I’ll just point out, as I think I pointed out before, that in 2017, when the Republicans tried to repeal the Affordable Care Act, one of the things they discovered is that Medicaid is actually kind of popular. I think … much to their surprise, they discovered that Medicaid is also kind of popular, maybe not as much as Medicare, but more than I think they thought. So I guess the budget wars really get started next week: We get President Biden’s budget, right?
Ollstein: And House Republicans are allegedly working on something. We don’t know when it will come or how much detail it will have, but it will be some sort of counter to Biden’s budget. But, you know, the real work will come later, in hashing it out in negotiations. And, really, a small number of people will be involved in that. And so just like Rachel said, you know, you’re going to see a lot of proposals thrown out over the next several months. Not all of them should necessarily be taken seriously or taken as determinative. Just one last interesting thing: This has been a really interesting education time, both for lawmakers and the public on just who is covered under these programs. I mean, the idea is that Medicare is so untouchable, is this third rail, because it is primarily seniors, and seniors vote. And seniors are more politically important to conservatives and Republicans. But people forget a lot of seniors are also on Medicaid. They get their nursing home coverage through there. And so I’ve heard a lot of Democratic lawmakers really hammering that argument lately and saying, look, you know, the stereotype for Medicaid is that it’s just poor adults, but …
Rovner: Yeah, moms and kids. That was how it started out.
Ollstein: Exactly.
Rovner: It was poor moms and kids.
Ollstein: Exactly. But it’s a lot more than that now. And it is more politically dicey to go after it than maybe people think.
Rovner: Yeah, I think Nancy Pelosi … in 2017 when, you know, if the threat with Medicare is throwing Granny off the cliff in her wheelchair, the threat of Medicaid is throwing Granny out of her nursing home, both of which have their political perils. All right. Well, we’ll definitely see this one play out for a while. I want to move to the public health beat. Lauren, you had a really cool story on the front page of The Washington Post this week about how the promise of ivermectin to treat infectious diseases in humans. And for those who forget, ivermectin is an anti-wormer drug that I give to my horse and both of my dogs. But the idea of using it for various infectious diseases just won’t die. What is the latest ivermectin craze?
Weber: Yes, and to be clear, there is an ivermectin that is a pill that can be given to humans, which is what these folks are talking about. But there’s this group called the Front Line COVID-19 Critical Care Alliance that really pushed ivermectin in the height of covid. As we all know on this podcast, scientific study after scientific study after clinical trial has disproved that there is any efficacy for that. But this group has continued to push it. And I discovered, looking at their website back this winter, that they’re now pushing it for the flu and RSV. And as I asked the CDC [Centers for Disease Control and Prevention] and medical experts, there’s no clinical data to support pushing that for the flu or RSV. And, you know, as one scientist said to me, they had data that … had antiviral properties in a test tube. But as one scientist said to me, well, if you put Coca-Cola in a test tube, it would show it had antiviral properties as well. So there’s a lot of pushback to these folks. But, that said, they told me that they have had their protocols downloaded over a million times. You know, they’re … absolutely have some prominence and have, you know, converted a share of the American population to the belief that this is a useful medical treatment for them. And one of the doctors that has left their group over their support of ivermectin said to me, “Look, I’m not surprised that they’re continuing to push this for something else. This is what they do now. They push this for other things.” And so it’s quite interesting to see this continue to play out as we continue into covid, to see them kind of expand, as these folks said to me, into other diseases.
Rovner: I know I mean, usually when we see these kinds of things, it’s because the people who are pushing them are also selling them and making money off of them. And I know that’s the case in some of this, but a lot of these are just doctors who are writing prescriptions for ivermectin. Right? I mean, this is an actual belief that they have.
Weber: Yeah, some of them do make money off of telehealth appointments. They can charge up to a couple hundred dollars for telehealth appointments. And one of the couple of co-founders had a lucrative Substack and book deal that talks about ivermectin and do get paid by this alliance. One of them made almost a quarter of a million dollars in salary from the alliance. But yeah, I mean, the average doctor that’s prescribing ivermectin, I mean — there were over 400,000 ivermectin prescriptions in, I think, it was August of 2021. So that’s a lot of prescriptions.
Rovner: They’re not all making money off of it.
Weber: They’re not all making money. And I mean, what’s wild to me is Merck has come out and said, which, in a very rare statement for a pharmaceutical company, you know, don’t prescribe our drug for this. And when I asked them about RSV and the flu, they said, yeah, our statement would still stand on that. So it’s a movement, to some extent. And the folks I talked to about it, they really believe …
Rovner: And I will say, for a while in 2021, you couldn’t get horse wormer, which is a very nasty-tasting paste, even the horses don’t really like it. Because it was hard to get ivermectin at all. So we’ll see where this goes next. Here’s one of those “in case you missed It” stories. The Tulsa World this week has an interview with former Republican Sen. James Inhofe, who said, in his blunt Inhofe way, that he retired last year not only because he’s 88, but because he’s still suffering the effects of long covid. And he’s not the only one — quote, “five or six others have [long covid], but I’m the only one who admits it,” he told the paper, referring to other members of the Senate, presumably other Republican members of the Senate. Now, mind you, the very conservative Inhofe voted against just about every covid funding bill. And my impression from not going to the Hill regularly in 2021 and 2022 is that while covid seemed to be floating around in the air, lots of people were getting it, very few people seemed to be getting very sick. But now we’re thinking that’s not really the case, right?
Ollstein: When I saw this, I immediately went back to a story I wrote about a year ago on Tim Kaine’s long covid diagnosis and his attempts to convince his colleagues to put more research funding or treatment funding, more basic covid prevention funding … you know, fewer people will get long covid if fewer people get covid in the first place. And there was just zero appetite on the Republican side for that. And that’s why a lot of it didn’t end up passing. Inhofe was one of the Republicans I talked to, and I said, you know, do you think you should do more about long covid? What do you think about this? And this is what he told me: “I have other priorities. We’re handling all we can right now.” And then he added that long covid is not that well defined. And he argued there’s no way to determine how many people are affected. Well.
Rovner: OK.
Ollstein: So that … in “Quotes That Aged Poorly Hall of Fame.”
Rovner: You know, obviously Tim Kaine came forward and talked about it. But now I’m wondering if there are people who are slowing down or looking like they’re not well, maybe they have long covid and don’t want to say.
Ollstein: Well, I mean, something that Tim Kaine’s case shows is that there’s no one thing it can look like and somebody can look completely healthy and normal on the outside and be suffering symptoms. And Tim Kaine has also said that members of Congress have quietly disclosed to him and thanked him for speaking up, but said they weren’t willing to do it themselves. And he, Tim Kaine, told me that he felt more comfortable speaking up because the kind of symptoms he had were less stigmatized. They weren’t anything in terms of impeding his mental capacity and function. And there’s just a lot of stigma and fear of people coming forward and admitting they’re having a problem.
Rovner: I find it kind of ironic that last week we talked about how, you know, members of Congress and politicians with mental health, you know, normally stigmatizing problems are more willing to talk about it. And yet here are people with long covid not willing to talk about it. So maybe we’ll see a little bit more after this or maybe not. I want to talk a little bit about artificial intelligence and health care. I’ve been wanting to talk about this for a while, but this week seems to be everyone is talking about AI. There have been a spate of stories about how different types of artificial intelligence are aiding in medical care, but also some cautionary tales, particularly about chat engines. They get all their information from the internet, good or bad. Now, we already have robots that do intricate surgeries and lots and lots of treatment algorithms. On the other hand, the little bit of AI that I already have that’s medical-oriented, my Fitbit, that sometimes accurately tracks my exercise and sometimes doesn’t, and the chat bot from my favorite chain drugstore that honestly cannot keep my medication straight. None of that makes me terribly optimistic about launching into health AI. Is this, like most tech, going to roll out a little before it’s ready and then we’ll work the bugs out? Or maybe are we going to be a little bit more careful with some of this stuff?
Cohrs: I think we’ve already seen some examples of things rolling out before they’re exactly ready. And I just thought of my colleague Casey Ross’ reporting on Epic’s algorithm that was supposed to help …
Rovner: Epic, the electronic medical records company.
Cohrs: Yes, yes. They had this algorithm that was supposed to help doctors treat sepsis patients, and it didn’t work. The problem with using AI in health care is that there are life-and-death consequences for some of these things. If you’re misdiagnosing someone, if you’re giving them medicine they don’t need, there are, like, those big consequences. But there are also the smaller ones too. And my colleague Brittany Trang wrote about how with doctor’s notes or transcripts of conversations between a physician and a patient sometimes AI has difficulty differentiating between an “mm-hm” or an “uh-huh” and telling whether that’s a yes or a no. And so I think that there’s just all of these really fascinating issues that we’re going to have to work through. And I think there is enormous potential, certainly, and I think there’s getting more experimentation. But like you said, I think in health care it’s just a very different beast when you’re rolling things out and making sure that they work.
Weber: Yeah, I wanted to add, I mean, one of the things that I found really interesting is that doctors’ offices are using some of it to reduce some of the administrative burden. As we all know, prior authorizations suck up a lot of time for doctors’ offices. And it seems like this has actually been really helpful for them. That said, I mean, that comes with the caveat of — my colleagues and I and much reporting has shown that — sometimes these things just make up references for studies. They just make it up. That level of “Is this just a made-up study that supports what I’m saying?” I think is really jarring. This isn’t quite like using Google. It cannot be trusted to the level … and I think people do have caution with it and they will have to continue to have caution with it. But I think we’re really only at the forefront of figuring out how this all plays out.
Rovner: I was talking before we started taping about how I got a text from my favorite chain drugstore saying that I was out of refills and that they would call my doctor, which is fine. And then they said, “Text ‘Yes’ if you would like us to call” … some other doctor. I’m like, “Who the heck is this other doctor?” And then I realize he’s the doctor I saw at urgent care last September when I burned myself. I’m like, “Why on earth would you even have him in your system?” So, you know, that’s the sort of thing … it’s like, we’re going to be really helpful and do something really stupid. I worry that Congress, in trying to regulate tech, and failing so far — I mean, we’ve seen how much they do and don’t know about, you know, Facebook and Instagram and the hand-wringing over TikTok because it’s owned by the Chinese — I can’t imagine any kind of serious, thoughtful regulation on this. We’re going to have to basically rely on the medical industry to decide how to roll this out, right? Or might somebody step in?
Ollstein: I mean, there could be agency, you know, rulemaking, potentially. But, yes, it’s the classic conundrum of technology evolving way faster than government can act to regulate it. I mean, we see that on so many fronts. I mean, look how long has gone without any kind of update. And, you know, the kinds of ways health information is shared are completely different from when that law was written, so …
Rovner: Indeed.
Weber: And as Rachel said, I mean, this is life-or-death consequences in some places. So the slowness with which the government regulates things could really have a problem here, because this is not something that is just little …
Rovner: Of the things that keep me awake at night, this is one of the things that keeps me awake at night. All right. Well, one of these weeks, we will not have a ton of reproductive health news. But this week isn’t it. As of this taping, we still have not gotten a decision in that Texas case challenging the FDA approval of the abortion pill, mifepristone, back in the year 2000. But there’s plenty of other abortion news happening in the Lone Star State. First, a federal judge in Texas who was not handpicked by the anti-abortion groups ruled that Texas officials cannot enforce the state’s abortion ban against groups who help women get abortion out of state, including abortion funds that help women get the money to go out of state to get an abortion. The judge also questioned whether the state’s pre-Roe ban is even in effect or has actually been repealed, although there are overlapping bans in the state that … so that wouldn’t make abortion legal. But still, this is a win for the abortion rights side, right, Alice?
Ollstein: Yeah, I think the right knows that there are two main ways that people are still getting abortions who live in ban states. They’re traveling out of state or they are ordering pills in the mail. And so they are moving to try to cut off both of those avenues. And, you know, running into some difficulty in doing so, both in the courts and just practically in terms of enforcing. This is part of that bigger battle to try to cut off, you know, people’s remaining avenues to access the procedure.
Rovner: Well, speaking exactly of that, Texas being Texas, this week, we saw a bill introduced in the state legislature that would ban the websites that include information about how to get abortion pills and would punish internet providers that fail to block those sites. It would also overturn the court ruling we just talked about by allowing criminal prosecution of anyone who helps someone get an abortion. Even a year ago, I would have said this is an obvious legislative overreach, but this is Texas. So now maybe not so much.
Ollstein: I mean, I think lots of states are just throwing things at the wall to see what sticks and to see what gets through the courts. You had states test the waters on banning certain kinds of out-of-state travel, and that hasn’t gone anywhere yet. But even things that don’t end up passing and being implemented can have a chilling effect. You have a lot of confusion right now. You have a lot of people not sure what’s legal, what’s not. And if you create this atmosphere of fear where people might be afraid to go out of state, might be afraid to ask for funding to go out of state, afraid to Google around and see what their options are that serves the intended impacts of these proposals, in terms of preventing people from exploring their options and seeing what they can do to terminate a pregnancy.
Rovner: Yeah. Well, meanwhile, a dozen states that are not named Texas are suing the FDA, trying to get it to roll back some of the prescribing requirements around the abortion pill. The states are arguing that not only are the risk-mitigation rules unnecessary, given the proven safety of mifepristone, but that some of the certification requirements could invade the privacy of patients and prescribers and subject them to harassment or worse. They’re asking the judge to halt enforcement of the restrictions while the case is being litigated. That could run right into [U.S. District] Judge [Matthew] Kacsmaryk’s possible injunction in Texas banning mifepristone nationwide. Then what happens? If you’ve got one judge saying, “OK, you can’t sell this nationwide,” and another judge saying … “Of course you can sell it, and you can’t use these safety restrictions that the FDA has put around it.” Then the FDA has two conflicting decisions in front of it.
Weber: Yeah, and I find the battles of the AGs and the abortion wars are really fascinating because, I mean, this is a lawsuit brought by states, which is attorneys general, Democratic attorneys general. And you’re seeing that play out. I mean, you see that in Texas, too, with [Ken] Paxton. You see it in Michigan with [Dana] Nessel. I mean, I would argue one of the things that attorney generals have been the most prominent on in the last several decades of American history and have actually had immediate effects on due to the fall of Roe v. Wade. So we’ll see what happens. But it is fascinating to see in real time this proxy battle, so to speak, between the two sides play out across the states and across the country.
Rovner: No, it’s funny. State AGs did do the tobacco settlement.
Weber: Yes.
Rovner: I mean, that would not have happened. But what was interesting about that is that it was very bipartisan.
Weber: Well, they were on the same side.
Rovner: And this is not.
Weber: Yeah, I mean, yeah, they were on the same side. This is a different deal. And I think to some extent, and I did some reporting on this last year, it speaks to the politicization of that office and what that office has become and how it’s become, frankly, a huge launching pad for people’s political careers. And the rhetoric there often is really notched up to the highest levels on both sides. So, you know, as we continue to see that play out, I think a lot of these folks will end up being folks you see on the national stage for quite some time.
Ollstein: I’ve been really interested in the states where the attorney general has clashed with other parts of their own state government. And so in North Carolina, for example, right now you have the current Democratic attorney general who is planning to run for governor. And he said, I’m not going to defend our state restrictions on abortion pills in court because I agree with the people challenging them. And then you have the Republican state legislatures saying, well, if he’s not going to defend these laws, we will. So that kind of clash has happened in Kentucky and other states where the attorney general is not always on the same side with other state officials.
Rovner: If that’s not confusing enough, we have a story out of Mississippi this week, one of the few states where voters technically have the ability to put a question on the ballot, except that process has been blocked for the moment by a technicality. Now, Republican legislators are proposing to restart the ballot initiative process. They would fix the technicality, but not for abortion questions. Reading from the AP story here, quote, “If the proposed new initiative process is adopted, state legislators would be the only people in Mississippi with the power to change abortion laws.” Really? I mean, it’s hard to conceive that they could say you can have a ballot question, but not on this.
Ollstein: This is, again, part of a national trend. There are several Republican-controlled states that are moving right now to attempt to limit the ability of people to put a measure on the ballot. And this, you know, comes as a direct result of last year. Six states had abortion-related referendums on their ballot. And in all six, the pro-abortion rights side won. Each one was a little different. We don’t need to get into it, but that’s the important thing. And so people voted pretty overwhelmingly, even in really red states like Kentucky and Montana. And so other states that fear that could happen there are now moving to make that process harder in different ways. You have Mississippi trying to do, like, a carve-out where nothing on abortion can make it through. Other states are just trying to raise, like, the signature threshold or the vote threshold people need to get these passed. There are a lot of different ways they’re going about it.
Rovner: I covered the Mississippi “personhood” amendment back in 2011. It was the first statewide vote on, you know, granting personhood to fetuses. And everybody assumed it was going to win, and it didn’t, even in Mississippi. So I think there’s reason for the legislators who are trying to re-stand up this ballot initiative process to worry about what might come up and how the voters might vote on it. Well, because I continue to hear people say that women trying to have babies are not being affected by state abortion bans and restrictions, this week we have not one but two stories of pregnant women who were very much impacted by abortion bans. One from NPR is the story of a Texas woman pregnant with twins — except one twin had genetic defects not only incompatible with life, but that threatened the life of both the other twin and the pregnant woman. She not only had to leave the state for a procedure to preserve her own life and that of the surviving twin, but doctors in Texas couldn’t even tell her explicitly what was going on for fear of being brought up on charges of violating the state’s ban. I think, Alice, you were the one talking about how, you know, women are afraid to Google. Doctors are afraid to say anything.
Ollstein: Yeah, absolutely. I mean, it’s a really chilling and litigious environment right now. And I think, as more and more of these stories start to come forward, I think that is spurring the debates you’re seeing in a lot of states right now about adding or clarifying or expanding the kind of exceptions that exist on these bans. So you have very heated debates going on right now in Utah and Tennessee and in several states around, you know, should we add more exceptions because there are some Republican lawmakers who are looking at these really tragic stories that are trickling out and saying, “This isn’t what we intended when we voted for this ban. Let’s go back and revisit.” Whether exceptions even work when they are on the books is another question that we can discuss. I mean, we have seen them not be effective in other states and people not able to navigate them.
Rovner: We’ve seen a lot of these stories about women whose water broke early and at what point is it threatening her life? How close to death does she have to be before doctors can step in? I mean, we’ve seen four or five of these. It’s not like they’re one-offs. The other story this week is from the Daily Beast. It’s about a 28-year-old Tennessee woman whose fetus had anomalies with its heart, brain, and kidneys. That woman also had to leave the state at her own expense to protect her own health. Is there a point where anti-abortion forces might realize they are actually deterring women who want babies from getting pregnant for fear of complications that they won’t be able to get treated?
Ollstein: Most of the pushback I’ve seen from anti-abortion groups, they claim that the state laws are fine and that doctors are misinterpreting them. And there is a semantic tug of war going on right now where anti-abortion groups are trying to argue that intervening in a medical emergency shouldn’t even count as an abortion. Doctors argue, no, it is an abortion. It’s the same procedure medically, and thus we are afraid to do it under the current law. And the anti-abortion groups are saying, “Oh, no, you’re saying that in bad faith; that doesn’t count as an abortion. An abortion is when it’s intended to kill the fetus.” So you’re having this challenging tug of war, and it’s not really clear what states are going to do. There’s a lot of state bills on this making their way through legislatures right now.
Rovner: And doctors and patients are caught in the middle. Well, finally this week, Eli Lilly announced it would lower, in some cases dramatically, the list prices for some of its insulin products. You may remember that, last year, Democrats in Congress passed a $35-per-month cap for Medicare beneficiaries but couldn’t get those last few votes to apply the cap to the rest of the population. Lilly is getting very good press. Its stock price went up, even though it’s not really capping all the out-of-pocket costs for insulin for everybody. But I’m guessing they’re not doing this out of the goodness of their drugmaking heart, right, Rachel?
Cohrs: Probably not. Even though there’s a quote from their CEO that implied that that was the case. I think there was one drug pricing expert at West Health Policy Center, Sean Dickson, who is very sharp on these issues, knows the programs well. And he pointed out that there’s a new policy going into effect in Medicaid next year, and it’s really, really wonky and complicated. But I’ll do my best to try to explain that, generally, in the Medicare program, rebates are capped, or they have been historically, at the price of the drug. So you can’t charge a drugmaker a rebate that’s higher than the cost. But …
Rovner: That would make sense.
Cohrs: Right. But that math can get kind of wonky when there are really high drug price increases and then that math gets really messed up. But Congress, I want to say it was in 2021, tweaked this policy to discourage those big price increases. And they said, you know what? We’re going to raise the rebate cap in Medicaid, which means that, drugmakers, if you are taking really big price increases, you may have to pay us every time someone on Medicaid fills those prescriptions. And I think people thought about insulin right away as a drug that has these really high rebates already and could be a candidate disproportionately impacted by this policy. So I thought that was an interesting point that Sean made about the timing of this. That change is supposed to go into effect early next year. So this could, in theory, save Lilly a lot of money in the Medicaid program because we don’t know exactly what their net prices were before.
Rovner: But this is very convenient.
Cohrs: It’s convenient. And there’s a chance that they’re not really losing any money right now, depending on how their contracts work with insurers. So I think, yeah, there is definitely a possibility for some ulterior motives here.
Rovner: And plus, the thing that I learned this week that I hadn’t known before is that there are starting to be some generic competition. The three big insulin makers, which are Lilly, Sanofi, and Novo Nordisk, may actually not become the, almost, the only insulin maker. So it’s probably in Lilly’s interest to step forward now. And, you know, they’re reducing the prices on their most popular insulins, but not necessarily their most expensive insulin. So I think there’s still money to be made in this segment. But they sure did get, you know, I watched all the stories come across. It’s, like, it’s all, oh, look at this great thing that Lilly has done and that everything’s going to be cheap. And it’s, like, not quite. But …
Cohrs: But it is different. It’s a big step. And I think …
Rovner: It is. It is.
Cohrs: Somebody has to go first in breaking this cycle. And I think it will be interesting to see how that plays out for them and whether the other two companies do follow suit. Sen. Bernie Sanders asked them to and said, you know, why don’t you just all do the same thing and lower prices on more products? So, yeah, we’ll see how it plays out.
Weber: Day to day, I mean, that’s a huge difference for people. I mean, that is a lot of money. That is a big deal. So, I mean, you know, no matter what the motivation, at the end of the day, I think the American public will be much happier with having to pay a lot less for insulin.
Rovner: Yeah, I’m just saying that not everybody who takes insulin is going to pay a lot less for insulin.
Weber: Right. Which is very fair, very fair.
Rovner: But many more people than before, which is, I think, why it got lauded by everybody. Although I will … I wrote in my notes, please, someone mention Josh Hawley taking credit and calling for legislation. Sen. Hawley from Missouri, who voted against extending the $35 cap, as all Republicans did, to the rest of the population, put out a tweet yesterday that was, like, this is a great thing and now we should have, you know, legislation to follow up. And I’m like: OK.
Cohrs: You’ll have to check on that. I actually think Hawley may have voted for it.
Rovner: Oh, a-ha. All right.
Cohrs: There were a few Republicans.
Rovner: Thank you.
Cohrs: It’s not enough, though.
Rovner: Yeah, I remember that they couldn’t get those last few votes. Yes, I think [Sen. Joe] Manchin voted against. He was the one, the last Democrat they couldn’t get right. That’s why they ended up dropping …
Cohrs: Uh, it had to be a 60-vote threshold, so …
Rovner: Oh, that’s right.
Cohrs: Yeah.
Rovner: All right. Good. Thank you. Good point, Rachel. All right. Well, that is the news for this week. Now it is time for our extra-credit segment. That’s when we each recommend a story we read this week we think you should read, too. As always, don’t worry if you miss it. We will post the links on the podcast page at khn.org and in our show notes on your phone or other mobile device. Alice, why don’t you go first this week?
Ollstein: Yeah. So I did the incredible New York Times investigation by Hannah Dreier on child labor. This is about undocumented, unaccompanied migrant children who are coming to the U.S. And the reason I’m bringing it up on our podcast is there is a health angle. So HHS [the Department of Health and Human Services], their Office of Refugee Resettlement has jurisdiction over these kids’ welfare and making sure they are safe. And that is not happening right now. The system is so overwhelmed that they have been cutting corners in how they vet the sponsors that they release the kids to. Of course, we remember that there were tons of problems with these kids being detained and kept for way too long and that being a huge threat to their physical and mental health. But this is sort of the pendulum has swung too far in the opposite direction, and they’re being released to people who in some cases straight up trafficking them and in other cases just forcing them to work and drop out of school, even if it’s not a trafficking situation. And so this reporting has already had an impact. The HHS has announced all these new initiatives to try to stop this. So we’ll see if they are effective. But really moving, incredible reporting.
Rovner: Yeah, it was an incredible story. Lauren.
Weber: I’m going to shout out my former KHN colleague Brett Kelman. I loved his piece on, I guess you can’t call it a medical device because it wasn’t approved by the FDA, which is the point of the story. But this device that was supposed to fix your jaw so you didn’t have to have expensive jaw surgery. Well, what it ended up doing is it messed up all these people’s teeth and totally destroyed their mouths and left them with a bunch more medical and dental bills. And, you know, what I find interesting about the story, what I find interesting about the trend in general is the problem is, they never applied for anything with the FDA. So people were using this device, but they didn’t check, they didn’t know. And I think that speaks to the American public’s perception that devices and medical devices and things like this are safe to use. But a lot of times the FDA regulations are outdated or are not on top of this or the agency is so understaffed and not investigating that things like this slipped through the cracks. And then you have people — and it’s 10,000 patients, I believe, that have used this tool — that did not do what it is supposed to do and, in fact, injured them along the way. And I think that the FDA piece of that is really interesting. It’s something I’ve run into before looking at air cleaners and how they fit the gaps of that. And I think it’s something we’re going to continue to see as we examine how these agencies are really stacking up to the evolution of technology today.
Rovner: Yeah, capitalism is going to push everything. Rachel.
Cohrs: So my extra credit this week is actually an opinion piece, in Stat, and the headline is “Nonprofit Hospitals Are Failing Americans. Their Boards May Be a Reason Why.” It was written by Sanjay Kishore and Suhas Gondi. I think the part that really stood out to me is they analyzed the backgrounds and makeups of hospital boards, especially nonprofit hospitals. I think they analyzed like 20 large facilities. And the statistic that really surprised me was that, I think, 44% of those board members came from the financial sector representing investment funds, real estate, and other entities. Less than 15% were health care workers, 13% were physicians, and less than 1% were nurses. And, you know, I’ve spent a lot of time and we’ve spent a lot of time thinking about just how nonprofit hospitals are operating as businesses. And I think a lot of other publications have done great work as well making that point. But I think this is just a stark statistic that shows these boards that are supposed to be holding these organizations accountable are thinking about the bottom line, because that’s what the financial services sector is all about, and that there’s so much disproportionately less clinical representation. So obviously hospitals need admin sides to run, and they are businesses, and a lot of them don’t have very large margins. But the statistics just really surprised me as to the balance there.
Rovner: Yeah, I felt like this is one, you know, we’ve all been sort of enmeshed in this, you know, what are we going to do about the nonprofit hospitals that are not actually acting as charitable institutions? But I think the boards had been something that I had not seen anybody else look at until now. So it’s a really interesting piece. All right. Well, my story this week is the other big investigation from The New York Times. It’s called “A Drug Company Exploited a Safety Requirement to Make Money,” by Rebecca Robbins. And it’s about those same risk-mitigation rules from the FDA that are at the heart of those abortion drug lawsuits we talked about a few minutes ago. Except in this case, the drug company in question, Jazz Pharmaceuticals, somehow patented its risk-mitigation strategy as the distribution center — it’s actually called the REMS [Risk Evaluation and Mitigation Strategies] — which is managed to fend off generic competition for the company’s narcolepsy drug. It had also had a response already. It has produced a bipartisan bill in the Senate to close the loophole — but [I’ll] never underestimate the creativity of drugmakers when it comes to protecting their profit. It’s quite a story. OK. That’s our show for this week. As always, if you enjoy the podcast, you can subscribe wherever you get your podcasts. We’d appreciate it if you left us a review; that helps other people find us, too. Special thanks, as always, to our ever-patient producer, Francis Ying. Also, as always, you can email us your comments or questions. We’re at whatthehealth — all one word — at kff.org. Or you can tweet me. I’m @jrovner. Alice?
Ollstein: @AliceOllstein
Rovner: Rachel.
Cohrs: @rachelcohrs
Rovner: Lauren.
Weber: @LaurenWeberHP
Rovner: We will be back in your feed next week. In the meantime, be healthy.
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Ante vacío federal, estados promueven leyes duras contra el uso de sustancias tóxicas en cosméticos
Washington se unió a más de una docena de estados en tomar medidas enérgicas contra las sustancias tóxicas en cosméticos después que un estudio financiado por el estado encontró plomo, arsénico y formaldehído en productos para maquillaje y alisado del cabello fabricados por CoverGirl y otras marcas.
Estados Unidos se estancó en las regulaciones químicas después de la década de 1970, según Bhavna Shamasunder, profesora asociada de política urbana y ambiental en el Occidental College. Y eso ha dejado un vacío regulatorio, ya que la blanda supervisión federal permite que productos potencialmente tóxicos que estarían prohibidos en Europa se vendan en las tiendas estadounidenses.
“Muchos productos en el mercado no son seguros”, dijo Shamasunder. “Es por eso que los estados están ayudando a generar una solución”.
La posible exposición a sustancias tóxicas en los cosméticos es especialmente preocupante para las mujeres de color, porque estudios muestran que las mujeres negras usan más productos para el cabello que otros grupos raciales, y que las hispanas y asiáticas han informado que usan más cosméticos en general que las mujeres negras y blancas no hispanas.
La legislación del estado de Washington es un segundo intento de aprobar la Ley de Cosméticos Libres de Tóxicos, luego que, en 2022, los legisladores aprobaran un proyecto de ley que eliminó la prohibición de ingredientes tóxicos en los cosméticos.
Este año, los legisladores tienen un contexto adicional después que un informe encargado por la Legislatura, y publicado en enero por el Departamento de Ecología del estado, encontró múltiples productos con niveles preocupantes de químicos peligrosos, incluyendo plomo y arsénico en la base CoverGirl Clean Fresh Pressed Powder de tinte oscuro.
El lápiz labial de color continuo CoverGirl y la base de maquillaje Black Radiance Pressed Powder de Markwins Beauty Brands se encuentran entre otros productos de varias marcas que contienen plomo, según el informe.
Los equipos de investigación preguntaron a mujeres hispanas, negras no hispanas y multirraciales qué productos de belleza usaban. Luego, probaron 50 cosméticos comprados en Walmart, Target y Dollar Tree, entre otras tiendas.
“Las empresas están agregando conservantes como el formaldehído a los productos cosméticos”, dijo Iris Deng, investigadora de tóxicos del Departamento de Ecología estatal. “El plomo y el arsénico son historias diferentes. Se detectan como contaminantes”.
Markwins Beauty Brands no respondió a las solicitudes de comentarios.
“Las trazas nominales de ciertos elementos a veces pueden estar presentes en las formulaciones de productos como consecuencia del origen mineral natural, según lo permitido por la ley que aplica”, dijo Miriam Mahlow, vocera de la empresa matriz de CoverGirl, Coty Inc., en un correo electrónico.
Los autores del informe de Washington dijeron que los países de la Unión Europea prohíben productos como la base CoverGirl de tinte oscuro. Esto se debe a que el arsénico y el plomo se han relacionado con el cáncer, y daño cerebral y del sistema nervioso. “No se conoce un nivel seguro de exposición al plomo”, dijo Marissa Smith, toxicóloga reguladora sénior del estado de Washington. Y el formaldehído también es carcinógeno.
“Cuando encontramos estos químicos en productos aplicados directamente a nuestros cuerpos, sabemos que las personas están expuestas”, agregó Smith. “Por lo tanto, podemos suponer que estas exposiciones están contribuyendo a los impactos en la salud”.
Aunque la mayoría del contenido de plomo de los productos era bajo, dijo Smith, las personas a menudo están expuestas durante años, lo que aumenta considerablemente el peligro.
Los hallazgos del departamento de ecología de Washington no fueron sorprendentes: otros organismos han detectado conservantes como formaldehído o, más a menudo, agentes liberadores de formaldehído como quaternium-15, DMDM hidantoína, imidazolidinil urea y diazolidinil urea en productos para alisar el cabello comercializados especialmente para las mujeres negras.
El formaldehído es uno de los productos químicos utilizados para embalsamar los cadáveres antes de los funerales.
Además de Washington, al menos 12 estados —Hawaii, Illinois, Massachusetts, Michigan, Nevada, Nueva Jersey, Nueva York, Carolina del Norte, Oregon, Rhode Island, Texas y Vermont— están considerando leyes para restringir o exigir la divulgación de sustancias químicas tóxicas en cosméticos y otros productos de cuidado personal.
Los estados están actuando porque el gobierno federal tiene una autoridad limitada, dijo Melanie Benesh, vicepresidenta de asuntos gubernamentales del Environmental Working Group, una organización sin fines de lucro que investiga qué hay en los productos para el hogar y para el consumidor.
“La FDA ha tenido recursos limitados para intentar la prohibición de ingredientes”, agregó Benesh.
El Congreso no ha otorgado a la Agencia de Protección Ambiental (EPA) una amplia autoridad para regular estos productos, a pesar de que los contaminantes y conservantes de los cosméticos terminan en el suministro de agua.
En 2021, un hombre de California solicitó a la EPA que prohibiera los químicos tóxicos en los cosméticos bajo la Ley de Control de Sustancias Tóxicas, pero la petición fue denegada, porque los cosméticos están fuera del alcance de la jurisdicción de la ley, dijo Lynn Bergeson, abogada en Washington, D.C.
Bergeson dijo que la regulación de los productos químicos está sujeta a la Ley Federal de Alimentos, Medicamentos y Cosméticos, pero la Administración de Medicamentos y Alimentos (FDA) regula solo los aditivos de color y los productos químicos en los protectores solares porque sostienen que disminuyen el riesgo de cáncer de piel.
Minnesota, por ejemplo, llena los vacíos regulatorios al realizar pruebas de mercurio, hidroquinona y esteroides en productos para aclarar la piel. También aprobó una ley en 2013 que prohíbe el formaldehído en productos para niños, como lociones y baños de burbujas.
California ha aprobado varias leyes que regulan los ingredientes y el etiquetado de los cosméticos, incluida la Ley de Cosméticos Seguros de California, en 2005. Una ley adoptada en 2022 prohíbe las sustancias de perfluoroalquilo y polifluoroalquilo agregadas intencionalmente, conocidas como PFAS, en cosméticos y prendas de vestir a partir de 2025.
El año pasado, Colorado también aprobó una prohibición de PFAS en maquillaje y otros productos.
Pero expertos en seguridad del consumidor dijeron que los estados no deberían tener que llenar el vacío dejado por las regulaciones federales, y que un enfoque más inteligente implicaría que el gobierno federal sometiera los ingredientes de los cosméticos a un proceso de aprobación.
Mientras tanto, los estados están librando una batalla cuesta arriba, porque miles de productos químicos están disponibles para los fabricantes. Como resultado, existe una brecha entre lo que los consumidores necesitan como protección y la capacidad de acción de los reguladores, dijo Laurie Valeriano, directora ejecutiva de Toxic-Free Future, una organización sin fines de lucro que investiga y defiende la salud ambiental.
“Los sistemas federales son inadecuados porque no requieren el uso de productos químicos más seguros”, dijo Valeriano. “En cambio, permiten productos químicos peligrosos en productos para el cuidado personal, como PFAS, ftalatos o incluso formaldehído”.
Además, el sistema de evaluación de riesgos del gobierno federal tiene fallas, dijo, “porque intenta determinar cuánto riesgo de exposiciones tóxicas es aceptable”. Por el contrario, el enfoque que el estado de Washington espera legislar evaluaría los peligros y preguntaría si los productos químicos son necesarios o si existen alternativas más seguras, es decir, evitar los ingredientes tóxicos en los cosméticos en primer lugar.
Es muy parecido al enfoque adoptado por la Unión Europea (UE).
“Ponemos límites y restricciones a estos productos químicos”, dijo Mike Rasenberg, director de evaluación de peligros de la Agencia Europea de Productos Químicos en Helsinki, Finlandia.
Rasenberg dijo que debido a que la investigación muestra que el formaldehído causa cáncer nasal, la UE lo ha prohibido en productos de belleza, además del plomo y el arsénico. Los 27 países de la UE también trabajan juntos para probar la seguridad de los productos.
En Alemania se examinan anualmente más de 10,000 productos cosméticos, dijo Florian Kuhlmey, vocero de la Oficina Federal de Protección al Consumidor y Seguridad Alimentaria de ese país. Y no termina ahí. Este año, Alemania examinará alrededor de 200 muestras de dentífrico para niños en busca de metales pesados y otros elementos prohibidos en la UE para cosméticos, agregó Kuhlmey.
La legislación en Washington se acercaría a la estrategia europea para la regulación de productos químicos. Si se aprueba, daría a los minoristas que venden productos con ingredientes prohibidos hasta 2026 para vender los productos existentes.
Mientras tanto, los clientes pueden protegerse buscando productos de belleza naturales, dijo la dermatóloga del área de Atlanta, Chynna Steele Johnson.
“Muchos productos tienen agentes liberadores de formaldehído”, dijo Steele Johnson. “Pero no es algo que los clientes puedan encontrar en una etiqueta. Mi sugerencia, y esto también se aplica a los alimentos, sería, cuanto menos ingredientes, mejor”.
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
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2 years 1 month ago
Noticias En Español, Public Health, Race and Health, States, california, Colorado, Hawaii, Illinois, Latinos, Minnesota, Nevada, New Jersey, New York, North Carolina, Oregon, Rhode Island, texas, Vermont, Washington
Migrants crossing the southern border show signs of 'worsening trauma,' including sexual assault: report
Ever since he began volunteering two months ago for weekend shifts at a clinic in one of the largest shelters in the border city of Ciudad Juarez, Mexico, Dr.
Ever since he began volunteering two months ago for weekend shifts at a clinic in one of the largest shelters in the border city of Ciudad Juarez, Mexico, Dr. Brian Elmore has treated about 100 migrants for respiratory viruses and a handful of more serious emergencies, the Associated Press reported.
But what worries him most is something else.
Many migrants are traumatized after their long journeys north.
TEXAS RANCHERS PLEAD FOR HELP FROM GOV. ABBOTT AFTER THIRD ATTEMPTED BREAK-IN AMID MIGRANT CRISIS
The "worsening trauma" experienced by the migrants, the AP reported, often involves witnessing murders and suffering from kidnappings and sexual assault.
"Most of our patients have symptoms of PTSD — I want to initiate a screening for every patient," Elmore, an emergency medicine doctor at Clinica Hope, told the AP.
The Catholic nonprofit Hope Border Institute opened the clinic this past fall with the help of Bishop Mark Seitz of El Paso, Texas, which borders Juarez, said the AP.
"The Hope Border Institute (HOPE) brings the perspective of Catholic social teaching to bear on the realities unique to our U.S.-Mexico border region," the group's website says.
"Through a robust program of research and policy work, leadership development and action, we work to build justice and deepen solidarity across the borderlands."
Professionals including doctors, social workers, clergy and law enforcement say growing numbers of migrants are suffering violence that amounts to torture — and are arriving at the U.S.-Mexican border in desperate need of trauma-informed medical and mental health treatment, the AP reported.
AIR FORCE VETERAN AND HIS WIFE FACED PTSD HEAD-ON WITH THE HELP OF ALL SECURE FOUNDATION
But resources for this specialized care are scarce.
And the network of shelters is so overwhelmed by new arrivals and migrants that only the most severe cases can be handled, according to the AP's reporting.
One specific example, as a case manager described: "A pregnant 13-year-old … fled gang rapes, and so [she] needs help with child care and middle school."
DR. MARC SIEGEL: MENTAL HEALTH CRISIS IS ‘MUCH WORSE’ DUE TO THE PANDEMIC
Zury Reyes Borrero, a case manager in Arizona with the Center for Victims of Torture, visited the young girl when she gave birth — and described the circumstances.
"We get people at their most vulnerable. Some don’t even realize they’re in the U.S.," the case manager told the AP.
In the past six months, Reyes Borrero and a colleague have helped about 100 migrants at Catholic Community Services’ Casa Alitas, a shelter in Tucson, Arizona, she said.
Each visit with a migrant can take hours.
Caseworkers try to build a rapport with the individuals — and focus on empowering them, Reyes Borrero told the AP.
This group of people "might not have any memory that’s safe," said Sarah Howell, who runs a clinical practice and a nonprofit treating migrant survivors of torture in Houston, Texas.
When she visits patients in their new Texas communities, said Howell, they routinely introduce relatives or neighbors who also need help with severe trauma; yet they reportedly lack the stability and safety necessary for healing.
Most migrants need "first-aid mental health" as well as long-term care that’s even harder to arrange once they disperse from border-area shelters to communities across the country, noted another professional.
Left untreated, such trauma can escalate to where it necessitates psychiatric care instead of therapy and self-help, Dylan Corbett, Hope Border Institute’s executive director, told the AP.
Service providers and migrants alike are saying the most dangerous spot on journeys filled with peril at every step is "la selva" — the Darien Gap jungle separating Colombia from Panama, crossed by increasing numbers of Venezuelans, Cubans and Haitians who first moved to South America and are now seeking safer lives in the United States, the AP reported.
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Natural perils like deadly snakes and rivers only add to the risks of an area rife with bandits preying on migrants, the same source noted.
Meanwhile, over four million migrants have flocked to the southern border since Vice President Kamala Harris was assigned the task of addressing the "root cause" of the crisis nearly two years ago, Fox News Digital reported this weekend.
U.S. Customs and Border Protection tracked 233,000 border encounters in November.
That's a 35% increase from when Harris was assigned her role on mass migration there in March 2021.
These encounters are expected to increase after the expiration of Title 42, a pandemic-era policy under President Donald Trump that allows border agents to turn away migrants at the border.
The White House in December could not define exactly what Harris does in her role to address the mass migration.
"I don’t have anything to lay out specifically on what that work looks like," press secretary Karine Jean-Pierre said at a press briefing when asked about the role of the vice president.
The vice president’s office did not respond to a request for comment.
The Associated Press, as well as Fox News Digital's Patrick Hauf, contributed reporting.
2 years 3 months ago
Health, lifestyle, mexico, border-security, texas, migrant-caravan, illegal-immigrants, mental-health, ptsd, Arizona, roman-catholic
The Business of Clinical Trials Is Booming. Private Equity Has Taken Notice.
After finding success investing in the more obviously lucrative corners of American medicine — like surgery centers and dermatology practices — private equity firms have moved aggressively into the industry’s more hidden niches: They are pouring billions into the business of clinical drug trials.
To bring a new drug to market, the FDA requires pharmaceutical firms to perform extensive studies to demonstrate safety and efficacy, which are often expensive and time-consuming to conduct to the agency’s specifications. Getting a drug to market a few months sooner and for less expense than usual can translate into millions in profit for the manufacturer.
That is why a private equity-backed startup like Headlands Research saw an opportunity in creating a network of clinical sites and wringing greater efficiency out of businesses, to perform this critical scientific work faster. And why Moderna, Pfizer, Biogen, and other drug industry bigwigs have been willing to hire it — even though it’s a relatively new player in the field, formed in 2018 by investment giant KKR.
In July 2020, Headlands announced it won coveted contracts to run clinical trials of covid-19 vaccines, which would include shots for AstraZeneca, Johnson & Johnson, Moderna, and Pfizer.
In marketing its services, Headlands described its mission to “profoundly impact” clinical trials — including boosting participation among racial and ethnic minorities who have long been underrepresented in such research.
“We are excited,” CEO Mark Blumling said in a statement, to bring “COVID-19 studies to the ethnically diverse populations represented at our sites.” Blumling, a drug industry veteran with venture capital and private equity experience, told KHN that KKR backed him to start the company, which has grown by buying established trial sites and opening new ones.
Finding and enrolling patients is often the limiting and most costly part of trials, said Dr. Marcella Alsan, a public policy professor at Harvard Kennedy School and an expert on diverse representation in clinical trials, which have a median cost of $19 million for new drugs, according to Johns Hopkins University researchers.
Before covid hit, Headlands acquired research centers in McAllen, Texas; Houston; metro Atlanta; and Lake Charles, Louisiana, saying those locations would help it boost recruitment of diverse patients — an urgent priority during the pandemic in studying vaccines to ward off a disease disproportionately killing Black, Hispanic, and Native Americans.
Headlands’ sites also ran, among other things, clinical studies on treatments to combat Type 2 diabetes, postpartum depression, asthma, liver disease, migraines, and endometriosis, according to a review of website archives and the federal website ClinicalTrials.gov. But within two years, some of Headlands’ alluring promises would fall flat.
In September, Headlands shuttered locations in Houston — one of the nation’s largest metro areas and home to major medical centers and research universities — and Lake Charles, a move Blumling attributed to problems finding “experienced, highly qualified staff” to carry out the complex and highly specialized work of clinical research. The McAllen site is not taking on new research as Headlands shifts operations to another South Texas location it launched with Pfizer.
What impact did those sites have? Blumling declined to provide specifics on whether enrollment targets for covid vaccine trials, including by race and ethnicity, were met for those locations, citing confidentiality. He noted that for any given trial, data is aggregated across all sites and the drug company sponsoring it is the only entity that has seen the data for each site once the trial is completed.
A fragmented clinical trials industry has made it a prime target for private equity, which often consolidates markets by merging companies. But Headlands’ trajectory shows the potential risks of trying to combine independent sites and squeeze efficiency out of studies that will affect the health of millions.
Yashaswini Singh, a health economist at Johns Hopkins who has studied private equity acquisitions of physician practices, said consolidation has potential downsides. Singh and her colleagues published research in September analyzing acquisitions in dermatology, gastroenterology, and ophthalmology that found physician practices — a business with parallels to clinical trial companies — charged higher prices after acquisition.
“We’ve seen reduced market competition in a variety of settings to be associated with increases in prices, reduction in access and choice for patients, and so on,” Singh said. “So it’s a delicate balance.”
Dr. Aaron Kesselheim, a professor of medicine at Harvard Medical School, called private equity involvement in trials “concerning.”
“We need to make sure that patients” know enough to provide “adequate, informed consent,” he said, and ensure “protections about the privacy of the data.”
“We don’t want those kinds of things to be lost in the shuffle in the goals of making money,” he said.
Blumling said trial sites Headlands acquired are not charging higher prices than before. He said privacy “is one of our highest concerns. Headlands holds itself to the highest standard.”
Good or bad, clinical trials have become a big, profitable business in the private equity sphere, data shows.
Eleven of the 25 private equity firms identified by industry tracker PitchBook as the top investors in health care have bought stakes in clinical research companies, a KHN analysis found. Those companies have been involved in studies ranging from covid vaccines to treatments for ovarian cancer, Parkinson’s disease, and Alzheimer’s.
Contracted firms also analyze patient data and prepare materials to secure approval from regulatory agencies, in hopes of getting more drugs to market faster. And a big draw for investors: Clinical research companies make money whether or not a drug succeeds, making it less risky than investing in a drug company.
The number of clinical trials has exploded to more than 434,000 registered studies this year as of late November, more than triple the number a decade ago.
Still, most trial sites are physician practices that don’t consistently perform studies, according to a presentation by Boston-based investment firm Provident Healthcare Partners.
“Independent sites are being purchased by private equity, and they’re moving into larger site groups of 30, 40, and then their game plan is to roll that up into a business and then sell it again,” said Linda Moore Schipani, CEO of Clinical Research Associates, a Nashville-based company that worked on covid vaccine trials for AstraZeneca, Novavax, and Pfizer. “That’s kind of the endgame.”
Headlands is a prime example. It announced in November 2019 that it would acquire six centers in the U.S. and Canada, including three sites in Texas and Louisiana owned by Centex Studies that would help improve participation among Hispanics and African Americans.
It has made other acquisitions since then and opened new sites in areas with “extremely limited trial options,” something Blumling says distinguishes his company.
“I’m not an evangelist for private equity,” Blumling said. “The ability of KKR to be willing to invest in something that is a three- to five-year return versus a one- to two-year return is something that you won’t see out there.”
A research center in Brownsville, Texas — a stone’s throw from the U.S.-Mexico border and where 95% of the population is Hispanic or Latino — is one of several where it is partnering with Pfizer to boost patient diversity.
To recruit patients, Headlands “is really going beyond what a lot of sites do, which is social media,” Blumling said in an interview. “It’s going within churches, community fairs, really getting out into as much as possible the broader community.”
Headlands closed the Houston and Lake Charles sites because of staffing issues, Blumling said, and finished or moved their studies elsewhere. Blumling said the decision to close those locations “did not have anything to do with the speed of trials.”
Similarly, he said, Headlands is moving the McAllen site’s operations to Brownsville “because it had a larger population of trained personnel.”
“We want to continue to grow sites and do great work,” Blumling said. “If we can’t find the people in order to do that at the quality that we demand, which is at the highest level, then it doesn’t make sense to keep those sites.”
‘The Writing to Me Was on the Wall’
In 2006, Devora Torrence co-founded Centex Studies, which she described as “my little mom and pop business” in a 2021 podcast about female entrepreneurs in science. She said a flurry of interest from private equity came at the end of 2018. The appeal was evident: Drug companies were relying on bigger clinical trial networks.
“The thing is speed, getting it to market. With a bigger network, you get that speed,” Torrence said on the podcast. “The writing to me was on the wall that either I get some outside investment and scale up myself, or kind of listen to these guys and see if maybe now would be the right time to exit.”
Joining Headlands had its benefits during the pandemic because she could “lean on” its other sites with experience running vaccine trials. “Had we not gotten those … we may not still be here,” Torrence said.
Torrence, whose LinkedIn profile said she left the company in 2021, didn’t respond to messages from KHN.
Lyndon Fullen, a health care consultant and former Centex employee, said private equity provides funding that allows companies to add study sites.
“I completely support it,” he said. “If it’s about reaching that large patient population, it’s of course better to have larger groups with that funding.”
Opportunity in Long Covid
Contract research organization Parexel saw opportunity in the covid pandemic — millions of people were developing long covid after infection and there were few, if any, meaningful treatment options.
The company, which employs more than 19,000 people, was acquired in 2021 by EQT Private Equity and Goldman Sachs’ private equity arm for $8.5 billion, billions more than the $4.5 billion that private equity firm Pamplona Capital Management paid when it took Parexel private in 2017.
A growing body of research shows the debilitating effects of long covid, including a recent study of tens of thousands of patients in Scotland where nearly half had not fully recovered months later. But treatments addressing its root causes could be years away. “It’s a huge number of people,” said Dr. Nathalie Sohier, who leads Parexel’s infectious diseases and vaccines franchise. “There’s a lot of need.”
Long covid represents the promise and peril of the work to develop new drugs: Millions of patients create a potentially lucrative market for drug companies, and yet researchers and industry experts say they are reluctant to jump in. In part, that’s because “it’s not a well-defined disease, and that really makes it highly risky for companies to invest in research,” said Cecil Nick, a vice president for Parexel.
“How are we going to be able to tell the FDA that our drug works? We can’t count the number of people who died; we can’t count the number of people in the hospital,” said Dr. Steven Deeks, a University of California-San Francisco professor who is running an observational study on long covid patients.
As of August, among more than 4,400 covid studies, only 304 focused on long covid. A third of those were related to drug development, Sohier said.
Sohier said “there are few” companies in its long covid program. That hasn’t stopped Parexel from pitching itself as the ideal partner to shepherd new products, including by doing regulatory work and using remote technology to retain patients in trials. Parexel has worked on nearly 300 covid-related studies in more than 50 countries, spokesperson Danaka Williams said.
Michael Fenne, research and campaign coordinator with the Private Equity Stakeholder Project, which studies private equity investments, said Parexel and other contract research organizations are beefing up their data capacity. The aim? To have better information on patients.
“It kind of ties into access and control of patients,” Fenne said. “Technology makes accessing patients, and then also having more reliable information on them, easier.”
KHN senior correspondent Fred Schulte and Megan Kalata contributed to this report.
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
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2 years 4 months ago
Cost and Quality, COVID-19, Health Care Costs, Health Industry, Pharmaceuticals, Clinical Trials, FDA, Georgia, Long Covid, Louisiana, Patients for Profit, Prescription Drugs, Study, texas
Audits — Hidden Until Now — Reveal Millions in Medicare Advantage Overcharges
Newly released federal audits reveal widespread overcharges and other errors in payments to Medicare Advantage health plans for seniors, with some plans overbilling the government more than $1,000 per patient a year on average.
Summaries of the 90 audits, which examined billings from 2011 through 2013 and are the most recent reviews completed, were obtained exclusively by KHN through a three-year Freedom of Information Act lawsuit, which was settled in late September.
The government’s audits uncovered about $12 million in net overpayments for the care of 18,090 patients sampled, though the actual losses to taxpayers are likely much higher. Medicare Advantage, a fast-growing alternative to original Medicare, is run primarily by major insurance companies.
Officials at the Centers for Medicare & Medicaid Services have said they intend to extrapolate the payment error rates from those samples across the total membership of each plan — and recoup an estimated $650 million as a result.
But after nearly a decade, that has yet to happen. CMS was set to unveil a final extrapolation rule Nov. 1 but put that decision off until February.
Ted Doolittle, a former deputy director of CMS’ Center for Program Integrity, which oversees Medicare’s efforts to fight fraud and billing abuse, said the agency has failed to hold Medicare Advantage plans accountable. “I think CMS fell down on the job on this,” said Doolittle, now the health care advocate for the state of Connecticut.
Doolittle said CMS appears to be “carrying water” for the insurance industry, which is “making money hand over fist” off Medicare Advantage. “From the outside, it seems pretty smelly,” he said.
In an email response to written questions posed by KHN, Dara Corrigan, a CMS deputy administrator, said the agency hasn’t told health plans how much they owe because the calculations “have not been finalized.”
Corrigan declined to say when the agency would finish its work. “We have a fiduciary and statutory duty to address improper payments in all of our programs,” she said.
The 90 audits are the only ones CMS has completed over the past decade, a time when Medicare Advantage has grown explosively. Enrollment in the plans more than doubled during that period, passing 28 million in 2022, at a cost to the government of $427 billion.
Seventy-one of the 90 audits uncovered net overpayments, which topped $1,000 per patient on average in 23 audits, according to the government’s records. Humana, one of the largest Medicare Advantage sponsors, had overpayments exceeding that $1,000 average in 10 of 11 audits, according to the records.
CMS paid the remaining plans too little on average, anywhere from $8 to $773 per patient.
Auditors flag overpayments when a patient’s records fail to document that the person had the medical condition the government paid the health plan to treat, or if medical reviewers judge the illness is less severe than claimed.
That happened on average for just over 20% of medical conditions examined over the three-year period; rates of unconfirmed diseases were higher in some plans.
As Medicare Advantage’s popularity among seniors has grown, CMS has fought to keep its audit procedures, and the mounting losses to the government, largely under wraps.
That approach has frustrated both the industry, which has blasted the audit process as “fatally flawed” and hopes to torpedo it, and Medicare advocates, who worry some insurers are getting away with ripping off the government.
“At the end of the day, it’s taxpayer dollars that were spent,” said David Lipschutz, a senior policy attorney with the Center for Medicare Advocacy. “The public deserves more information about that.”
At least three parties, including KHN, have sued CMS under the Freedom of Information Act to shake loose details about the overpayment audits, which CMS calls Risk Adjustment Data Validation, or RADV.
In one case, CMS charged a law firm an advance search fee of $120,000 and then provided next to nothing in return, according to court filings. The law firm filed suit last year, and the case is pending in federal court in Washington, D.C.
KHN sued CMS in September 2019 after the agency failed to respond to a FOIA request for the audits. Under the settlement, CMS agreed to hand over the audit summaries and other documents and pay $63,000 in legal fees to Davis Wright Tremaine, the law firm that represented KHN. CMS did not admit to wrongfully withholding the records.
High Coders
Most of the audited plans fell into what CMS calls a “high coding intensity group.” That means they were among the most aggressive in seeking extra payments for patients they claimed were sicker than average. The government pays the health plans using a formula called a “risk score” that is supposed to render higher rates for sicker patients and lower ones for healthier ones.
But often medical records supplied by the health plans failed to support those claims. Unsupported conditions ranged from diabetes to congestive heart failure.
Overall, average overpayments to health plans ranged from a low of $10 to a high of $5,888 per patient collected by Touchstone Health HMO, a New York health plan whose contract was terminated “by mutual consent” in 2015, according to CMS records.
Most of the audited health plans had 10,000 members or more, which sharply boosts the overpayment amount when the rates are extrapolated.
In all, the plans received $22.5 million in overpayments, though these were offset by underpayments of $10.5 million.
Auditors scrutinize 30 contracts a year, a small sample of about 1,000 Medicare Advantage contracts nationwide.
UnitedHealthcare and Humana, the two biggest Medicare Advantage insurers, accounted for 26 of the 90 contract audits over the three years.
Eight audits of UnitedHealthcare plans found overpayments, while seven others found the government had underpaid.
UnitedHealthcare spokesperson Heather Soule said the company welcomes “the program oversight that RADV audits provide.” But she said the audit process needs to compare Medicare Advantage to original Medicare to provide a “complete picture” of overpayments. “Three years ago we made a recommendation to CMS suggesting that they conduct RADV audits on every plan, every year,” Soule said.
Humana’s 11 audits with overpayments included plans in Florida and Puerto Rico that CMS had audited twice in three years.
The Florida Humana plan also was the target of an unrelated audit in April 2021 by the Health and Human Services inspector general. That audit, which covered billings in 2015, concluded Humana improperly collected nearly $200 million that year by overstating how sick some patients were. Officials have yet to recoup any of that money, either.
In an email, Humana spokesperson Jahna Lindsay-Jones called the CMS audit findings “preliminary” and noted they were based on a sampling of years-old claims.
“While we continue to have substantive concerns with how CMS audits are conducted, Humana remains committed to working closely with regulators to improve the Medicare Advantage program in ways that increase seniors’ access to high-quality, lower cost care,” she wrote.
Billing Showdown
Results of the 90 audits, though years old, mirror more recent findings of a slew of other government reports and whistleblower lawsuits alleging that Medicare Advantage plans routinely have inflated patient risk scores to overcharge the government by billions of dollars.
Brian Murphy, an expert in medical record documentation, said collectively the reviews show that the problem is “absolutely endemic” in the industry.
Auditors are finding the same inflated charges “over and over again,” he said, adding: “I don’t think there is enough oversight.”
When it comes to getting money back from the health plans, extrapolation is the big sticking point.
Although extrapolation is routinely used as a tool in most Medicare audits, CMS officials have never applied it to Medicare Advantage audits because of fierce opposition from the insurance industry.
“While this data is more than a decade old, more recent research demonstrates Medicare Advantage’s affordability and responsible stewardship of Medicare dollars,” said Mary Beth Donahue, president of the Better Medicare Alliance, a group that advocates for Medicare Advantage. She said the industry “delivers better care and better outcomes” for patients.
But critics argue that CMS audits only a tiny percentage of Medicare Advantage contracts nationwide and should do more to protect tax dollars.
Doolittle, the former CMS official, said the agency needs to “start keeping up with the times and doing these audits on an annual basis and extrapolating the results.”
But Kathy Poppitt, a Texas health care attorney, questioned the fairness of demanding huge refunds from insurers so many years later. “The health plans are going to fight tooth and nail and not make this easy for CMS,” she said.
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
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2 years 4 months ago
Health Care Costs, Health Industry, Insurance, Medicare, CMS, Connecticut, Florida, Insurers, texas
Sick Profit: Investigating Private Equity’s Stealthy Takeover of Health Care Across Cities and Specialties
Two-year-old Zion Gastelum died just days after dentists performed root canals and put crowns on six baby teeth at a clinic affiliated with a private equity firm.
His parents sued the Kool Smiles dental clinic in Yuma, Arizona, and its private equity investor, FFL Partners. They argued the procedures were done needlessly, in keeping with a corporate strategy to maximize profits by overtreating kids from lower-income families enrolled in Medicaid. Zion died after being diagnosed with “brain damage caused by a lack of oxygen,” according to the lawsuit.
Kool Smiles “overtreats, underperforms and overbills,” the family alleged in the suit, which was settled last year under confidential terms. FFL Partners and Kool Smiles had no comment but denied liability in court filings.
Private equity is rapidly moving to reshape health care in America, coming off a banner year in 2021, when the deep-pocketed firms plowed $206 billion into more than 1,400 health care acquisitions, according to industry tracker PitchBook.
Seeking quick returns, these investors are buying into eye care clinics, dental management chains, physician practices, hospices, pet care providers, and thousands of other companies that render medical care nearly from cradle to grave. Private equity-backed groups have even set up special “obstetric emergency departments” at some hospitals, which can charge expectant mothers hundreds of dollars extra for routine perinatal care.
As private equity extends its reach into health care, evidence is mounting that the penetration has led to higher prices and diminished quality of care, a KHN investigation has found. KHN found that companies owned or managed by private equity firms have agreed to pay fines of more than $500 million since 2014 to settle at least 34 lawsuits filed under the False Claims Act, a federal law that punishes false billing submissions to the federal government with fines. Most of the time, the private equity owners have avoided liability.
New research by the University of California-Berkeley has identified “hot spots” where private equity firms have quietly moved from having a small foothold to controlling more than two-thirds of the market for physician services such as anesthesiology and gastroenterology in 2021. And KHN found that in San Antonio, more than two dozen gastroenterology offices are controlled by a private equity-backed group that billed a patient $1,100 for her share of a colonoscopy charge — about three times what she paid in another state.
It’s not just prices that are drawing scrutiny.
Whistleblowers and injured patients are turning to the courts to press allegations of misconduct or other improper business dealings. The lawsuits allege that some private equity firms, or companies they invested in, have boosted the bottom line by violating federal false claims and anti-kickback laws or through other profit-boosting strategies that could harm patients.
“Their model is to deliver short-term financial goals and in order to do that you have to cut corners,” said Mary Inman, an attorney who represents whistleblowers.
Federal regulators, meanwhile, are almost blind to the incursion, since private equity typically acquires practices and hospitals below the regulatory radar. KHN found that more than 90% of private equity takeovers or investments fall below the $101 million threshold that triggers an antitrust review by the Federal Trade Commission and the U.S. Justice Department.
Spurring Growth
Private equity firms pool money from investors, ranging from wealthy people to college endowments and pension funds. They use that money to buy into businesses they hope to flip at a sizable profit, usually within three to seven years, by making them more efficient and lucrative.
Private equity has poured nearly $1 trillion into nearly 8,000 health care transactions during the past decade, according to PitchBook.
Fund managers who back the deals often say they have the expertise to reduce waste and turn around inefficient, or moribund, businesses, and they tout their role in helping to finance new drugs and technologies expected to benefit patients in years to come.
Critics see a far less rosy picture. They argue that private equity’s playbook, while it may work in some industries, is ill suited for health care, when people’s lives are on the line.
In the health care sphere, private equity has tended to find legal ways to bill more for medical services: trimming services that don’t turn a profit, cutting staff, or employing personnel with less training to perform skilled jobs — actions that may put patients at risk, critics say.
KHN, in a series of articles published this year, has examined a range of private equity forays into health care, from its marketing of America’s top-selling emergency contraception pill to buying up whole chains of ophthalmology and gastroenterology practices and investing in the booming hospice care industry and even funeral homes.
These deals happened on top of well-publicized takeovers of hospital emergency room staffing firms that led to outrageous “surprise” medical bills for some patients, as well as the buying up of entire rural hospital systems.
“Their only goal is to make outsize profits,” said Laura Olson, a political science professor at Lehigh University and a critic of the industry.
Hot Spots
When it comes to acquisitions, private equity firms have similar appetites, according to a KHN analysis of 600 deals by the 25 firms that PitchBook says have most frequently invested in health care.
Eighteen of the firms have dental companies listed in their portfolios, and 16 list centers that offer treatment of cataracts, eye surgery, or other vision care, KHN found.
Fourteen have bought stakes in animal hospitals or pet care clinics, a market in which rapid consolidation led to a recent antitrust action by the FTC. The agency reportedly also is investigating whether U.S. Anesthesia Partners, which operates anesthesia practices in nine states, has grown too dominant in some areas.
Private equity has flocked to companies that treat autism, drug addiction, and other behavioral health conditions. The firms have made inroads into ancillary services such as diagnostic and urine-testing and software for managing billing and other aspects of medical practice.
Private equity has done so much buying that it now dominates several specialized medical services, such as anesthesiology and gastroenterology, in a few metropolitan areas, according to new research made available to KHN by the Nicholas C. Petris Center at UC-Berkeley.
Although private equity plays a role in just 14% of gastroenterology practices nationwide, it controls nearly three-quarters of the market in at least five metropolitan areas across five states, including Texas and North Carolina, according to the Petris Center research.
Similarly, anesthesiology practices tied to private equity hold 12% of the market nationwide but have swallowed up more than two-thirds of it in parts of five states, including the Orlando, Florida, area, according to the data.
These expansions can lead to higher prices for patients, said Yashaswini Singh, a researcher at the Bloomberg School of Public Health at Johns Hopkins University.
In a study of 578 physician practices in dermatology, ophthalmology, and gastroenterology published in JAMA Health Forum in September, Singh and her team tied private equity takeovers to an average increase of $71 per medical claim filed and a 9% increase in lengthy, more costly, patient visits.
Singh said in an interview that private equity may develop protocols that bring patients back to see physicians more often than in the past, which can drive up costs, or order more lucrative medical services, whether needed or not, that boost profits.
“There are more questions than answers,” Singh said. “It really is a black hole.”
Jean Hemphill, a Philadelphia health care attorney, said that in some cases private equity has merely taken advantage of the realities of operating a modern medical practice amid growing administrative costs.
Physicians sometimes sell practices to private equity firms because they promise to take over things like billing, regulatory compliance, and scheduling — allowing doctors to focus on practicing medicine. (The physicians also might reap a big payout.)
“You can’t do it on a scale like Marcus Welby used to do it,” Hemphill said, referring to an early 1970s television drama about a kindly family doctor who made house calls. “That’s what leads to larger groups,” she said. “It is a more efficient way to do it.”
But Laura Alexander, a former vice president of policy at the nonprofit American Antitrust Institute, which collaborated on the Petris Center research, said she is concerned about private equity’s growing dominance in some markets.
“We’re still at the stage of understanding the scope of the problem,” Alexander said. “One thing is clear: Much more transparency and scrutiny of these deals is needed.”
‘Revenue Maximization’
Private equity firms often bring a “hands-on” approach to management, taking steps such as placing their representatives on a company’s board of directors and influencing the hiring and firing of key staffers.
“Private equity exercises immense control over the operations of health care companies it buys an interest in,” said Jeanne Markey, a Philadelphia whistleblower attorney.
Markey represented physician assistant Michelle O’Connor in a 2015 whistleblower lawsuit filed against National Spine and Pain Centers and its private equity owner, Sentinel Capital Partners.
In just a year under private equity guidance, National Spine’s patient load quadrupled as it grew into one of the nation’s largest pain management chains, treating more than 160,000 people in about 40 offices across five East Coast states, according to the suit.
O’Connor, who worked at two National Spine clinics in Virginia, said the mega-growth strategy sprang from a “corporate culture in which money trumps the provision of appropriate patient care,” according to the suit.
She cited a “revenue maximization” policy that mandated medical staffers see at least 25 patients a day, up from 16 to 18 before the takeover.
The pain clinics also overcharged Medicare by billing up to $1,100 for “unnecessary and often worthless” back braces and charging up to $1,800 each for urine drug tests that were “medically unnecessary and often worthless,” according to the suit.
In April 2019, National Spine paid the Justice Department $3.3 million to settle the whistleblower’s civil case without admitting wrongdoing.
Sentinel Capital Partners, which by that time had sold the pain management chain to another private equity firm, paid no part of National Spine’s settlement, court records show. Sentinel Capital Partners had no comment.
In another whistleblower case, a South Florida pharmacy owned by RLH Equity Partners raked in what the lawsuit called an “extraordinarily high” profit on more than $68 million in painkilling and scar creams billed to the military health insurance plan Tricare.
The suit alleges that the pharmacy paid illegal kickbacks to telemarketers who drove the business. One doctor admitted prescribing the creams to scores of patients he had never seen, examined, or even spoken to, according to the suit.
RLH, based in Los Angeles, disputed the Justice Department’s claims. In 2019, RLH and the pharmacy paid a total of $21 million to settle the case. Neither admitted liability. RLH managing director Michel Glouchevitch told KHN that his company cooperated with the investigation and that “the individuals responsible for any problems have been terminated.”
In many fraud cases, however, private equity investors walk away scot-free because the companies they own pay the fines. Eileen O’Grady, a researcher at the nonprofit Private Equity Stakeholder Project, said government should require “added scrutiny” of private equity companies whose holdings run afoul of the law.
“Nothing like that exists,” she said.
Questions About Quality
Whether private equity influences the quality of medical care is tough to discern.
Robert Homchick, a Seattle health care regulatory attorney, said private equity firms “vary tremendously” in how conscientiously they manage health care holdings, which makes generalizing about their performance difficult.
“Private equity has some bad actors, but so does the rest of the [health care] industry,” he said. “I think it’s wrong to paint them all with the same brush.”
But incipient research paints a disturbing picture, which took center stage earlier this year.
On the eve of President Joe Biden’s State of the Union speech in March, the White House released a statement that accused private equity of "buying up struggling nursing homes” and putting “profits before people.”
The covid-19 pandemic had highlighted the “tragic impact” of staffing cuts and other moneysaving tactics in nursing homes, the statement said.
More than 200,000 nursing home residents and staffers had died from covid in the previous two years, according to the White House, and research had linked private equity to inflated nursing costs and elevated patient death rates.
Some injured patients are turning to the courts in hopes of holding the firms accountable for what the patients view as lapses in care or policies that favor profits over patients.
Dozens of lawsuits link patient harm to the sale of Florida medical device maker Exactech to TPG Capital, a Texas private equity firm. TPG acquired the device company in February 2018 for about $737 million.
In August 2021, Exactech recalled its Optetrak knee replacement system, warning that a defect in packaging might cause the implant to loosen or fracture and cause “pain, bone loss or recurrent swelling.” In the lawsuits, more than three dozen patients accuse Exactech of covering up the defects for years, including, some suits say, when “full disclosure of the magnitude of the problem … might have negatively impacted” Exactech’s sale to TPG.
Linda White is suing Exactech and TPG, which she asserts is “directly involved” in the device company’s affairs.
White had Optetrak implants inserted into both her knees at a Galesburg, Illinois, hospital in June 2012. The right one failed and was replaced with a second Optetrak implant in July 2015, according to her lawsuit. That one also failed, and she had it removed and replaced with a different company’s device in January 2019.
The Exactech implant in White’s left knee had to be removed in May 2019, according to the suit, which is pending in Cook County Circuit Court in Illinois.
In a statement to KHN, Exactech said it conducted an “extensive investigation” when it received reports of “unexpected wear of our implants.”
Exactech said the problem dated to 2005 but was discovered only in July of last year. “Exactech disputes the allegations in these lawsuits and intends to vigorously defend itself,” the statement said. TPG declined to comment but has denied the allegations in court filings.
‘Invasive Procedures’
In the past, private equity business tactics have been linked to scandalously bad care at some dental clinics that treated children from low-income families.
In early 2008, a Washington, D.C., television station aired a shocking report about a local branch of the dental chain Small Smiles that included video of screaming children strapped to straightjacket-like “papoose boards” before being anesthetized to undergo needless operations like baby root canals.
Five years later, a U.S. Senate report cited the TV exposé in voicing alarm at the "corporate practice of dentistry in the Medicaid program.” The Senate report stressed that most dentists turned away kids enrolled in Medicaid because of low payments and posed the question: How could private equity make money providing that care when others could not?
“The answer is ‘volume,’” according to the report.
Small Smiles settled several whistleblower cases in 2010 by paying the government $24 million. At the time, it was providing “business management and administrative services” to 69 clinics nationwide, according to the Justice Department. It later declared bankruptcy.
But complaints that volume-driven dentistry mills have harmed disadvantaged children didn’t stop.
According to the 2018 lawsuit filed by his parents, Zion Gastelum was hooked up to an oxygen tank after questionable root canals and crowns “that was empty or not operating properly” and put under the watch of poorly trained staffers who didn’t recognize the blunder until it was too late.
Zion never regained consciousness and died four days later at Phoenix Children’s Hospital, the suit states. The cause of death was “undetermined,” according to the Maricopa County medical examiner’s office. An Arizona state dental board investigation later concluded that the toddler’s care fell below standards, according to the suit.
Less than a month after Zion’s death in December 2017, the dental management company Benevis LLC and its affiliated Kool Smiles clinics agreed to pay the Justice Department $24 million to settle False Claims Act lawsuits. The government alleged that the chain performed “medically unnecessary” dental services, including baby root canals, from January 2009 through December 2011.
In their lawsuit, Zion’s parents blamed his death on corporate billing policies that enforced “production quotas for invasive procedures such as root canals and crowns” and threatened to fire or discipline dental staff “for generating less than a set dollar amount per patient.”
Kool Smiles billed Medicaid $2,604 for Zion’s care, according to the suit. FFL Partners did not respond to requests for comment. In court filings, it denied liability, arguing it did not provide “any medical services that harmed the patient.”
Covering Tracks
Under a 1976 federal law called the Hart-Scott-Rodino Antitrust Improvements Act, deal-makers must report proposed mergers to the FTC and the Justice Department antitrust division for review. The intent is to block deals that stifle competition, which can lead to higher prices and lower-quality services.
But there’s a huge blind spot, which stymies government oversight of more than 90% of private equity investments in health care companies: The current threshold for reporting deals is $101 million.
KHN’s analysis of PitchBook data found that just 423 out of 7,839 private equity health care deals from 2012 through 2021 were known to have exceeded the current threshold.
In some deals, private equity takes a controlling interest in medical practices, and doctors work for the company. In other cases, notably in states whose laws prohibit corporate ownership of physician practices, the private equity firm handles a range of management duties.
Thomas Wollmann, a University of Chicago researcher, said antitrust authorities may not learn of consequential transactions “until long after they have been completed” and “it's very hard to break them up after the fact.”
In August, the FTC took aim at what it called “a growing trend toward consolidation” by veterinary medicine chains.
The FTC ordered JAB Consumer Partners, a private equity firm based in Luxembourg, to divest from some clinics in the San Francisco Bay and Austin, Texas, areas as part of a proposed $1.1 billion takeover of a rival.
The FTC said the deal would eliminate “head-to-head” competition, “increasing the likelihood that customers are forced to pay higher prices or experience a degradation in quality of the relevant services.”
Under the order, JAB must obtain FTC approval before buying veterinary clinics within 25 miles of the sites it owns in Texas and California.
The FTC would not say how much market consolidation is too much or whether it plans to step up scrutiny of health care mergers and acquisitions.
“Every case is fact-specific,” Betsy Lordan, an FTC spokesperson, told KHN.
Lordan, who has since left the agency, said regulators are considering updates to regulations governing mergers and are reviewing about 1,900 responses to the January 2022 request for public comment. At least 300 of the comments were from doctors or other health care workers.
Few industry observers expect the concerns to abate; they might even increase.
Investors are flush with “dry powder,” industry parlance for money waiting to stoke a deal.
The Healthcare Private Equity Association, which boasts about 100 investment companies as members, says the firms have $3 trillion in assets and are pursuing a vision for "building the future of healthcare.”
That kind of talk alarms Cornell University professor Rosemary Batt, a longtime critic of private equity. She predicts that investors chasing outsize profits will achieve their goals by “sucking the wealth” out of more and more health care providers.
“They are constantly looking for new financial tricks and strategies,” Batt said.
KHN’s Megan Kalata contributed to this article.
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
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