|THIS WEEK IN HEALTHCARE
What happened in healthcare this week—and what we think about it.
Entering a new phase of the vaccine rollout
With more than 222M Americans having received at least one dose of COVID vaccine, and 27.5 percent of the population now fully vaccinated, we are now nearing a point at which vaccine supply will exceed demand, signaling a new phase of the rollout. This week, for the first time since February, the daily rate of vaccinations slowed substantially, down about 11 percent from last week on a seven-day rolling average. Several states and counties are dialing back requests for new vaccine shipments, and the New York Times reported that some local health departments are beginning to shutter mass vaccination sites as appointment slots go unfilled. On Friday, the White House’s COVID response coordinator, Jeff Zients, said that the Biden administration now expects “daily vaccination rates will fluctuate and moderate,” after several weeks of accelerating pace. In every state, everyone over the age of 16 is now eligible to be vaccinated, but experts expect that demand from the “vaccine-eager” population will run out over the next two weeks, necessitating a more aggressive campaign to distribute vaccines in hard-to-reach populations, and to convince vaccine skeptics to get the shot. Vaccine hesitancy, like so many other issues related to the COVID pandemic, has now become starkly politicized—one recent survey found that 43 percent of Republicans “likely will never get” the vaccine, as opposed to only 5 percent of Democrats. Another 12 percent of those surveyed, regardless of party identification, say they plan to “see how it goes” before getting the vaccine, a subset that will surely be unnerved by continued doubts about the safety of the Johnson & Johnson (J&J) vaccine. An expert advisory panel on Friday recommended that use of the J&J shot be resumed, but advised that a warning be included about potential risk of rare blood clots in women under 50. The first three months of the COVID vaccination campaign have been a staggering success—but getting from 27 percent fully vaccinated to the 80 percent needed for “herd immunity” will likely be a much tougher slog.
A Texas-sized showdown on Medicaid expansion
The showdown between the Biden administration and the state of Texas over Medicaid expansion continued to escalate this week. Sen. John Cornyn (R-TX) said he planned to place a hold on the confirmation of Chiquita Brooks-LaSure to become Administrator of the Centers for Medicare & Medicaid Services (CMS), until his concerns over the agency’s move last week to rescind a waiver extension previously granted by the Trump administration were addressed. The so-called “1115 waiver”—worth more than $11B annually—would have extended by a decade Texas’ ability to use Medicaid funds to cover hospital costs for uninsured residents, rather than expanding Medicaid coverage under the Affordable Care Act (ACA). In rescinding the waiver extension, the Biden administration cited the lack of a public notice process before the waiver was granted, and said that the state’s existing waiver would instead expire next year, as previously scheduled. Sources inside the administration told the Washington Post last week that the move was intended to force Texas’ hand on Medicaid expansion; the state is one of 12 that have not expanded Medicaid, leaving it with the largest share of uninsured residents of any state, with eligibility currently limited to pregnant women, children, people with disabilities, and families with monthly incomes under $300 per month, or 13.6 percent of the federal poverty level.
Enticing the dozen remaining holdout states to expand Medicaid is an important policy priority for the new administration. A key component of the recently passed American Rescue Plan Act is a package of enhanced incentives for those states to expand eligibility, offering an extended 90 percent federal match, in addition to increased funding for existing Medicaid populations. Although none of the non-expansion states have budged yet, there has been renewed focus among state lawmakers on Medicaid expansion, including in Texas, where the idea had garnered bipartisan support. However, on Thursday, the Texas legislature voted down a proposal aimed at pushing the state toward expanding coverage for the uninsured, by an 80-68 margin. Meanwhile, the recission of Texas’ waiver has angered the state’s Republican leadership, along with the Texas Hospital Association, whose members have benefitted from the waiver’s use of funds to reimburse them for delivering uncompensated care. While Cornyn’s hold will not ultimately stop the confirmation of the new CMS leader, the escalation on both sides over the past several days surely makes finding a compromise solution less likely. The Biden health policy team is said to be developing a new proposal, as part of an upcoming legislative package, to use the ACA marketplace to offer coverage to people in non-expansion states who might otherwise be eligible for Medicaid—yet another attempt to address one of the longest-standing points of contention stemming from the 2010 health reform law. The Medicaid showdown is far from over.
UVA Health wipes away decades of aggressive collections
Charlottesville-based University of Virginia Health System (UVA Health) announced this week that it will cancel thousands of court judgements and property liens issued across the past several decades against lower-income patients over unpaid medical bills. The cancellations apply to patients at or below 400 percent of the federal poverty level ($106,000 per year for a family of four), accounting for most of the legal actions taken by the system. This move, combined with other reforms UVA Health announced in 2019 in the wake of a Kaiser Health News investigation, is expected to benefit tens of thousands of patients. Taken together, the steps are estimated to cost UVA Health around $12M a year, a small fraction of the system’s annual revenue. While UVA Health’s collection policies will now be among the most generous of health systems nationwide, most families who have already surrendered money to the system via lawsuits or liens will not be reimbursed, and the new policies stop short of steps taken by Virginia Commonwealth University (VCU) Health in Richmond, which pledged to stop suing all patients, and is abolishing all old judgements and liens regardless of patient income. Still, it’s a long-overdue step in the right direction. Health systems have been stuck between a rock and a hard place when it comes to patient collections for years; the proliferation of high- deductible health plans has meant direct payment from patients is an increasing part of overall revenue. But pursuing patients to extract every last penny of payment, especially when it takes the form of chasing after lower-income patients who can often be bankrupted by healthcare bills, is rarely worth the time and money. It can quickly become a public relations nightmare (as in the case of UVA Health), and risks running afoul of the “community benefit” promised by not-for-profit health systems.