Tuesday Tidbits

As previously noted in the FEHBlog, a doctor who works for Medco spoke about advances in personalized medicine at the OPM AHIP carrier conference back in March. The Wall Street Journal lead yesterday's paper or I-pad) with a report that "New research is signaling a major shift in how cancer drugs are developed and patients are treated—offering the promise of personalized therapies that reach patients faster and are more effective than other medicines." The FFHBlog was startled to read that "Massachusetts General Hospital and MD Anderson Cancer Center are among institutions beginning to offer routine genetic profiling of tumors for every patient, moving into clinical practice a strategy reserved only for research just a year or two ago and unheard of a decade ago." Now, that's progress.

The AMA News reports that the Affordable Care Act's accountable care organization initiative is giving second life to independent practice associations or IPAs. "IPAs are organizations in which physicians retain their practice's independent corporate status, but become part of a separate organization with other practices to contract as a group to provide services." IPAs are becoming attractive because ACOs must treat at least 5,000 patients under the Medicare rule currently being finalized by HHS. However, the IPAs went broke in the 1990s because they could not operate successfully under HMO capitated rates. The ACO rule is much more complicated. Good luck with that.

Business Insurance reports that a McKinsey consulting survey predicts that 30% of employers who currently provide employee health benefits will cancel their plans and put their employees in the state health insurance exchanges.  Although the FEHB Program will still be here in 2014 and beyond, the FEHBlog will not be surprised if a large percentage of employers, particularly small employers drop coverage in 2014.  The ACA's generous premium and cost sharing subsidies available to people with income under $90,000 will create plenty of opportunities for employers to [legally] game the system. While the ACA's penalties on employers are higher for employees who are subsidized in the exchanges, the FEHBlog doesn't think that the penalties will come close to current health plan premiums. 2014 will be a very interesting year.