Weekend Update

Congress remains in session. Focus will now turn to a continuing resolution to fund federal government operations, including the FEHBP, in the new fiscal year which begins on October 1. It is expected that Congress will reach a bipartisan agreement on at least the first continuing resolution without rancor.

The U.S Court of Appeals for the Fourth Circuit issued opinions last week favoring the Administration's position supporting the Constitutionality of the Fourth Circuit's individual mandate -- here and here.  The Fourth and Sixth Circuits have ruled in the Administration's favor and the Eleventh Circuit has ruled against the Administration. The appellants in the Sixth Circuit case already have asked the Supreme Court to review the decision. In the FEHBlog's view, it's likely that the Supreme Court will take the case in time for it to render a decision before next July.

The Health Subcommittee of the House Ways and Means Committee held a hearing last Friday on consolidation in the health care industry, which is a necessary outcome of Affordable Care Act initiative's such as accountable care organizations or ACO's. Modern Healthcare reports that "Although healthcare experts testifying at the hearing generally agreed that provider consolidation is increasing, they differed over whether ACOs will exacerbate it."

On October 18, America's Health Insurance Plan is holding a conference about health plan efforts to create ACOs that are more flexible and inviting to healthcare providers than the Teutonic model created by CMS. AHIP reports that "New health care delivery and payment models in the private sector are being shaped by active collaboration between health insurance plans and providers, according to a new study by AHIP that appears in the September edition of Health Affairs."

The September issue of Health Affairs focuses on rising healthcare costs. Kaiser Health New reports that "The culprits, many of the studies conclude, are hospitals and doctors more than insurers or patients, despite the political rhetoric to the contrary."  What a surprise. The following paragraph in a recent Wall Street Journal article did surprise the FEHBlog:

An analysis released in 2010 and performed for the Medicare Payment Advisory Commission, or MedPAC, a Congressional watchdog, calculated how much American doctors would make if all their work was paid at Medicare rates. It found that the primary-care category did the worst, at around $101 an hour. Surgeons were at $161. Specialists who did nonsurgical procedures, such as dermatologists, did the best, averaging $214; radiologists would make $193.

The article discusses a lawsuit against CMS filed by a group of doctors practicing around Augusta, Ga.,

last month in a Maryland federal court, challenging the Medicare agency's reliance on the committee, which is convened by the American Medical Association and is known as the Relative Value Scale Update Committee, or RUC.  The suit [alleges that] the panel's role violates the law governing federal advisory committees. It seeks to force the agency to end the committee's current influence, or change its methods and makeup drastically to meet federal advisory-panel requirements for disclosure, membership and other areas.

Business Week reports that the Way and Means subcommittee hearing on healthcare industry consolidation raised the political pressure building against the Express Scripts acquisition of Medco. The Hill adds that "several industry sources told The Hill that the House Judiciary Committee is planning a hearing on the merger on Sept. 20 even though it has not been publicly announced."