Week in Washington is brought to you by Michael Cohen, PhD. Tune in each week to read the latest on healthcare policy and get a glimpse of what’s on the horizon.
Week in Washington
This week Speaker McCarthy outlined a House Republican proposal that would impose large cuts in federal spending in exchange for raising the debt ceiling. One of the main ways the bill would save money would be to impose work requirements on all Medicaid beneficiaries. Historically, work requirements have generally only been applied to the Medicaid expansion group. The proposed bill would apply work requirements to all 90 million beneficiaries, which would result in substantial decreases in enrollment/federal spending. States would lose matching funding if Medicaid beneficiaries do not meet certain eligibility standards.
McCarthy plans on bringing the bill to a vote next week, even though its passage in the House is uncertain. If it clears the House, President Biden announced he would veto the bill.
It’s important to note there is a very distinct difference from a government shutdown and if the US were to default on debt (which is what would happen eventually if the debt ceiling were not raised). The first is that unlike government shutdowns, all federal spending would be limited. Medicare and Medicaid payments would be affected by a debt ceiling issue while they are not during a government shutdown. Additionally, the economic effects would be far more severe from a default. Currently, the US is expected to breach the debt ceiling in early June.
CMS Finalizes ACA 2024 Payment Notice
CMS released the final ACA 2024 Payment Notice. The regulation sets standards for ACA Exchanges and plans for the upcoming benefit year. Generally, the rule finalized most of what was proposed back in December with a few exceptions. The rule loosens, relative to what was proposed, the number of non-standard plans an issuer is allowed to submit in states that HHS operates the Exchange (Healthcare.gov states). Issuers are now limited to four plans per product network type and metal level. The rule tightens the restrictions in 2025 by reducing the number of non-standard plans to two. The rule also delays the appointment wait time standards that were scheduled to go into effect in 2024. The rule also made some minor changes to FFE user fee rates (will be 2.2% in 2024) and changes in how the risk adjustment model will be calibrated for the 2024 benefit year. The final 2024 Actuarial Value Calculator was also released.
As of writing this blog, the public was awaiting court decisions on two high-profile court cases. The Supreme Court will respond on Friday if there will be a stay on the abortion drug ruling. The Administration has asked for the drug to remain on the market while the courts make a final decision on the drug’s status. The Administration was also awaiting word to see if the 5th Circuit Court would side with them and issue a stay on the recent ruling that struck down many of the preventative services requirements (i.e., keep the requirements in place).
Health Care Cost and Utilization Report
HCCI released its annual report of trends in health care spending and utilization. The report found that per person, health care spending increased 15% in 2021, which generally meant costs returned to trend after the one year decline due to the Covid-10 pandemic.
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