HRI regulatory center

Regulatory and legislative updates and analysis


President Donald Trump: The latest healthcare developments

Comprehensive report: Health reform 2.0: A guide to developing resilience amid an uncertain future for the Affordable Care Act

President Donald Trump and Republican congressional leadership have promised to repeal and replace the Affordable Care Act (ACA). Just how that will happen remains unclear. For the nation’s healthcare providers, payers, pharmaceutical and life sciences companies, new entrants and employers, this uncertainty makes planning for the future a complicated matter. In this report, PwC’s Health Research Institute and the firm’s strategy practice, Strategy&, present a comprehensive analysis of scenarios for repealing and replacing the ACA, along with practical steps health organizations can take in this time of uncertainty. 

Read HRI and Strategy&'s report, Health reform: 2.0: A guide to developing resilience amid an uncertain future for the Affordable Care Act

View more

Guide to the American Health Care Act

On May 4, House Republicans passed the American Health Care Act (AHCA), which aims to partially repeal and replace the Affordable Care Act (ACA). As passed by the House, the AHCA would repeal $663 billion in ACA taxes and fees over 10 years, phase out the ACA’s expansion of the Medicaid program, cap federal Medicaid funding and cut it by $834 billion over 10 years, replace the ACA’s income-based premium tax credits and other subsidies with age-based ones, and give states flexibility to opt out of key ACA provisions (see Figure 1), according to analyses by the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT). All told, 23 million fewer people likely would have insurance by 2026 compared with current law, according to the analyses. 

Read HRI’s spotlight, Trump administration health policy agenda: House passes the American Health Care Act

View more

Trump administration weekly highlights

Highlights – June 19, 2017

Trump administration: Senate releases draft of health reform legislation
The Senate released its draft Thursday of the Better Care Reconciliation Act (BCRA)—a bill intended to repeal and replace the ACA—that contains significant similarities to the American Health Care Act (AHCA) the House passed in May but with adjustments to phase in Medicaid cuts and allow more changes to insurance plans. Medicaid would continue as is until 2020, when a three-year phased end to enhanced subsidies would begin. Medicaid also would switch to a per-capita cap system, with the growth rate pegged to the Consumer Price Index (CPI)-Medical until 2025 when it would be lowered to CPI-Urban. For certain populations like the elderly or disabled, the growth rate would be increased by a percentage point.

The bill also would affect private insurance. The employer and individual mandate penalties would be eliminated, but without any continuous coverage requirement—a departure from the House-passed AHCA. Cost-sharing reduction payments that increase plan affordability would be explicitly funded through 2019. States could more easily apply for existing waivers (Section 1332) to exempt themselves from certain exchange requirements and from providing certain essential health benefits, and insurers would be permitted to charge elderly enrollees up to five times as much as their youngest enrollees. All but one of the ACA’s taxes would be eliminated; the Cadillac tax would be retained but delayed until 2026.

HRI impact analysis: The Senate AHCA’s structural similarities to the House version are intended to improve the bill’s chances of passage in the Senate, where Republicans can afford to lose only two votes, and then ultimately both chambers will need to agree on a reconciled version—no easy feat given deep fissures among Republicans. The Congressional Budget Office (CBO) is expected to issue a scoring of the bill early next week, and the Senate is expected to vote on it later in the week. The CBO had previously indicated that over the course of 10 years, the House version would result in 23 million more people lacking health insurance, and CMS’ Office of the Actuary estimated the bill would result in 13 million fewer people having insurance by calendar year 2026. Providers may be the most concerned about the bill’s rollback of the Medicaid program and subsequent benchmarking to a relatively low growth rate, which could increase rates of uncompensated care. Insurers could benefit from the legislation’s increased flexibility regarding insurance regulations but could lose out if subsidies to purchase insurance are less generous and coverage becomes unaffordable. Employers would benefit from the Cadillac tax’s delay and the employer mandate elimination but could see negative impact from job lock. All sectors—including life sciences—would benefit from the bill’s elimination of the ACA’s taxes.

Trump administration: CMS releases proposed 2018 MACRA rule
CMS published a 1,058-page proposed rule Tuesday laying out changes to its quality payment program established under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). For 2018, the program’s second year, the agency aims to simplify reporting requirements and offer support for clinicians participating in two payment tracks: Merit-based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs). Providers with fewer than 200 Medicare Part B patients or who made less than $90,000 in annual Medicare Part B claims would be exempt from the program in 2018, an increase from the 2017 threshold of 100 patients and $30,000. They also could benefit from the continuation of the “Pick Your Pace” option that was available in 2017, which allows clinicians to report a limited amount of quality data without facing a penalty. Also, solo practitioners and practices of 10 or fewer clinicians could ban together as a “virtual group” starting in 2018 to pool patient information and meet reporting requirements. Comments on the proposed rule are due Aug. 21.  

HRI impact analysis: CMS estimates that increasing the exemption threshold will result in 134,000 more clinicians being exempt from MIPS in 2018 than the 800,000 already exempted this year. This will mean about 37 percent of Medicare clinicians will be eligible to participate in MACRA in 2018. The proposed changes would likely make participation easier for small, independent and rural providers with less means to comply with reporting requirements. The American Medical Association has expressed support for the rule and the flexibility it grants. However, other industry stakeholders—such as the American Medical Group Association—fear it slows the transition to value-based payment. Clinicians, many of whom still have limited knowledge of the program or struggle to understand its requirements, likely will welcome the additional year of flexibility.

Highlights – June 12, 2017

Trump administration: CMS proposes reversal of long-term care arbitration ban
CMS last week proposed lifting an Obama administration ban on the use of pre-dispute binding arbitration agreements by many long-term care facilities. The proposed revisions instead require that agreements for binding arbitration be plainly written and clearly explained to residents and their families. The proposal also would require residents to acknowledge that they understand the agreement, and that facilities display public notices announcing the policy. The use of arbitration agreements has become a more widespread practice in the long-term care industry. The Obama administration’s arbitration ban, which was supposed to take effect last fall, has been on hold after the American Health Care Association (AHCA), a trade association representing 13,500 long-term care facilities, filed a lawsuit on behalf of its members in October. Public comments on the proposed revisions are due to CMS by Aug. 7.

HRI impact analysis: Binding arbitration clauses in contracts­—for credit cards, long-term care facilities and more—have become a hot-button issue for consumer advocacy groups such as the Consumer Financial Protection Bureau and Public Citizen, which have argued they unfairly create hurdles for consumers seeking restitution for problems. The long-term care industry should prepare for an aging baby boomer population—characterized as savvy consumers—who likely will shop around for long-term care services. These consumers could pay more attention to CMS’s Five-Star Quality Rating System—which compares long-term care facilities based on quality, safety, environmental and staffing measures—and demand more information about patient experience and other measures. A 2015 HRI survey found that 89 percent of consumers over the age of 65 believe patient satisfaction ratings are important when choosing a healthcare organization. These consumers may balk when presented with arbitration agreements without data regarding patient satisfaction or past arbitration cases.

View more

Payers: Trump administration briefs

As the debate over repealing and replacing the Affordable Care Act (ACA) moves to the US Senate, generating considerable uncertainty about the law’s future, health insurers face looming deadlines to participate in the ACA exchanges this fall. Several insurers already have announced they will drop or reduce participation, raising questions about the ACA nongroup market’s health as open enrollment begins Nov. 1.

Read HRI’s spotlight, Trump policy agenda – Exchange participation

 

After President Donald Trump and Republican leaders canceled a vote on the American Health Care Act (AHCA), the world became more complicated for health industry leaders and their consumers. Amid the multiple unknowns, health leaders may be tempted to wait for clarity. But in this atmosphere, it is even more important for organizations to lean into the unknowns and build resiliency. Healthcare companies can make some “no regrets” moves to build resilience amid periods of change and uncertainty.

Read HRI’s spotlight, What’s next for health reform?

 

As they mull the ACA’s fate, Republican lawmakers are weighing four options to replace the individual mandate. Any replacement to the mandate would need to accomplish two goals: encourage sign-ups by healthy enrollees, and discourage voluntary coverage gaps.

Read HRI’s spotlight, Replacing the individual mandate

View more

Providers: Trump administration briefs

After President Donald Trump and Republican leaders canceled a vote on the American Health Care Act (AHCA), the world became more complicated for health industry leaders and their consumers. Amid the multiple unknowns, health leaders may be tempted to wait for clarity. But in this atmosphere, it is even more important for organizations to lean into the unknowns and build resiliency. Healthcare companies can make some “no regrets” moves to build resilience amid periods of change and uncertainty.

Read HRI’s spotlight, What’s next for health reform?

 

The American Health Care Act (AHCA) aims to partially repeal and replace the ACA, by phasing out the ACA’s Medicaid expansion and capping federal funding for the program, among other things. Under the AHCA’s Medicaid plans, healthcare providers could experience a gradual increase in uncompensated care, cuts in Medicaid reimbursement rates, or both.

Read HRI’s spotlight, Implications of phasing out Medicaid expansion


Republican lawmakers are promoting Medicaid block grants as a way to control federal healthcare spending. Providers can expect a shift from an entitlement to a free market Medicaid approach, along with a possible rise in the uninsured population or decrease in reimbursement.

Read HRI’s spotlight, Medicaid block grants and per capita funding

View more

Pharma and life sciences companies: Trump administration briefs

As the US tax and trade reform debate continues, pharmaceutical and life sciences companies should waste no time in evaluating how different provisions would affect their business operations. Companies should model how these proposed changes could affect manufacturing and supply chains, locations of intellectual property (IP) holdings, unremitted earnings held overseas and planned capital expenditures.

Read HRI’s spotlight, Creating a pharmaceutical supply chain and business strategy amid tax and trade reform uncertainties


After President Donald Trump and Republican leaders canceled a vote on the American Health Care Act (AHCA), the world became more complicated for health industry leaders and their consumers. Amid the multiple unknowns, health leaders may be tempted to wait for clarity. But in this atmosphere, it is even more important for organizations to lean into the unknowns and build resiliency. Healthcare companies can make some “no regrets” moves to build resilience amid periods of change and uncertainty.

Read HRI’s spotlight, What’s next for health reform?

 

President Trump has consistently argued for lower prescription drug prices, but no specific plan has emerged from the White House. Pharmaceutical and life sciences companies are beginning to take steps to increase drug price transparency, limit price increases and explore novel approaches to demonstrate the pharmacoeconomic value of medicine, in light of pressure from all sides to justify pricing decisions.

Read HRI’s spotlight, Preparing for new drug-pricing risks


Tax proposals from the Trump administration could result in pharmaceutical, medical device and medical equipment companies restructuring their supply chains, repatriating overseas capital, and moving manufacturing back to the US. Such reforms, though, pose a sharp deviation from current global operational structures and thus could take years to be fully realized.

Read HRI’s spotlight, Tax reform proposals could impact pharma, medical device and equipment supply chains

View more

Health industry strategy: Trump administration briefs

Healthcare reform efforts by Congress will create challenges and opportunities that may require changes in operating models across the US healthcare industry. As the legislation undergoes debate and negotiation in Congress, healthcare organizations face considerable uncertainty. Organizations that have developed enterprise resilience—the ability to adapt the business model to change, anticipate disruption and recognize opportunities to generate a competitive advantage—may be best positioned to survive and thrive in these conditions.

Read HRI’s spotlight, Developing enterprise resilience in the face of health reform

 

The inaugural festivities are over, the revelers have gone home, and President Donald Trump has moved into the White House. With so much change in the air, what actions can health organizations take today?

Read HRI's spotlight, (Some) change is coming to healthcare

 

As the American Health Care Act (AHCA) bill makes its way through the legislative process, the nation’s healthcare industry is left to contend with considerable uncertainty. However, there are concrete steps healthcare stakeholders can take in the whirl of uncertainty to help build resilience no matter what specific policy provisions are enacted.

Read Strategy&’s article, Why Healthcare Companies Need to Focus on Enterprise Resilience

View more

2016 election insights and analysis

Like a chief executive hired to turn a failing company into a profitable one, president-elect Trump has said he will take an unflinching corporate approach to overhauling the US healthcare system. For an industry that prefers stability to surprises--and one that has worked to adapt to the Affordable Care Act—Trump’s “repeal and replace” agenda may create new uncertainty and opportunity for healthcare leaders.

Read HRI's report, President-elect Donald Trump: Turnaround time

 

View more

        

        


About the center

As the US healthcare system continues to undergo transformation, health industries are confronted with an evolving and complicated regulatory environment. With an eye towards how public policy impacts the business of healthcare, the HRI regulatory center serves as a vital resource for executive decision makers who must navigate the changes that lie ahead.

HRI's regulatory center is a group of seasoned professionals that analyze legislative and regulatory policy in Washington and in key states. The group, which focuses on all health sectors, publishes a weekly newsletter and more focused reports that detail the interconnection between Washington and healthcare. The HRI regulatory center calls upon key contacts in government and industry to develop a point of view that is both informative and actionable for health industry leaders.
 

Contact us

Benjamin Isgur
Health Research Institute leader
Tel: +1 (214) 754 5091
Email

Trine K. Tsouderos
HRI Regulatory Center Leader
Tel: +1 (312) 241 3824
Email

Alexander Gaffney
Senior Manager, PwC Health Research Institute, Washington
Tel: +1 (202) 414 4309
Email

Follow us