Health Brief: Administration Reaches Out to Uninsured After Aetna Announcement

Today’s Washington Brief

  • The Obama administration is planning significant outreach to people who have paid a fine for not having health insurance but could enroll on the Affordable Care Act exchanges before open enrollment begins in November, hoping to change the story line that plan options are shrinking. (The New York Times) As calls for Congress to take action to bolster the law increase, Democrats are somewhat wary of Sen. Bernie Sanders’ (I-Vt.) renewed push for a public option. (The Hill)
  • Aetna warned Department of Justice officials that it would withdraw from the Obamacare exchanges if the Obama administration moved to block its merger with rival Humana, a letter from CEO Mark Bertolini shows. Aetna maintained Wednesday that it left the exchanges after a closer look at its second quarter losses. (The Huffington Post)
  • As the Affordable Care Act increased access to care, it also increased prescription drug use and lowered out-of-pocket spending for consumers, a new study suggests. People who gained coverage under the law filled more prescriptions, and their health plans covered more of the costs associated with them. (Morning Consult)

Today’s Business Brief

  • Oscar, a startup health insurer, posted losses on the Affordable Care Act markets in three states for the first half of this year, spending more in New York, Texas and California on medical costs alone than it received from members in premiums. (Bloomberg News)
  • The pharmaceutical industry is quietly concerned about Donald Trump’s comments on trade deals, including some concerns that he hasn’t detailed how he would like trade partnerships that help the industry to change. (Stat)
  • The CEO of Kaiser Permanente affirmed the company’s commitment to the Obamacare exchanges, even after another major insurer announced it would retreat from several markets. The company has made a slight margin on the exchanges, but CEO Bernard Tyson acknowledged the markets are presently somewhat unstable. (Modern Healthcare)

Today’s Chart Review

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This Drug Could End America’s Painkiller Epidemic
Amrith Ramkumar, Bloomberg News

So far, the fight against America’s opioid crisis has focused on treating addiction and curbing abuse. In February, President Barack Obama asked Congress for $1.1 billion to fund health care for addicts, and last month Congress allocated $181 million in grants for state programs. But help could be on the way from scientists—help that could radically alter the American landscape of painkiller addiction and untimely death.

Genetic Studies’ Lack of Diversity May Lead to Misdiagnoses, Researchers Say
Amy Dockser Marcus, The Wall Street Journal

Doctors increasingly rely on genetic testing to help diagnose a patient’s illness or risk of getting a disease. Now a new study warns of the potential for the technology to lead to misdiagnosis.

European Stocks Rise as Fed Outlook Sinks Dollar; Brent Near $50
James Regan and Kelly Gilblom, Bloomberg News

European shares rose for the first time in a week and emerging markets advanced as a gauge of commodities climbed for the sixth straight day and minutes of the Federal Reserve’s last meeting damped prospects for a U.S. interest-rate hike. Miners led gains on the Stoxx Europe 600 Index and energy producers also rallied after Brent crude traded above $50 a barrel, while an MSCI index of emerging-market equities advanced to a one-year high.


Study Finds Obamacare Increased Prescription Drug Use, Reduced Spending
Caitlin Owens, Morning Consult

A new study suggests that because Obamacare has increased access to care, it has also increased prescription drug use while reducing out-of-pocket spending for consumers. It’s unclear how this affects health care spending in other sectors.

Six Years Into Obama’s Health Care Law, Who Are The Uninsured?
Abby Goodnough, The New York Times

Roughly 20 million more Americans have health insurance now than when President Obama’s health care law was passed in 2010. But as Mr. Obama prepares to leave office, there are still about 24 million adults with no coverage, according to a survey by the Commonwealth Fund, a health research group.

Aetna CEO Threatened Obamacare Pullout if Feds Opposed Humana Merger
Jonathan Cohn and Jeffrey Young, The Huffington Post

The big health care news this week came from Aetna, which announced on Monday it was dramatically scaling back participation in the Affordable Care Act ― thereby reducing insurer competition and forcing customers scattered across 11 states to find different sources of coverage next year. Aetna officials said the pullout was necessary because of Obamacare’s problems ― specifically, deep losses the insurer was incurring in the law’s health insurance exchanges.

As Insurers Like Aetna Balk, U.S. Makes New Push to Bolster Health Care Act
Robert Pear and Reed Abelson, The New York Times

Facing high-profile withdrawals from online insurance exchanges and surging premiums, the Obama administration is preparing a major push to enroll new participants into public marketplaces under the Affordable Care Act. The administration is eyeing an advertising campaign featuring testimonials from newly insured consumers, as well as direct appeals to young people hit by tax penalties this year for failing to enroll.

The Unstable Economics in Obama’s Health Law
Greg Ip, The Wall Street Journal

Barack Obama’s signature health-care law is struggling for one overriding reason: Selling mispriced insurance is a precarious business model. Aetna Inc. dealt the Affordable Care Act a severe setback by announcing Monday it would drastically reduce its participation in its insurance exchanges.

Insurance Startup Oscar Posts Obamacare Losses in Three States
Anna Edney and Zachary Tracer, Bloomberg News

Oscar Insurance Corp., the startup backed by Silicon Valley investors, posted losses in New York, Texas and California in the first half of the year, the latest example of insurers both large and small losing money in new markets created by President Barack Obama’s health-care overhaul. In New York, Oscar’s biggest market, the loss widened to $52.2 million from $15.5 million in the first half of 2015.

Kaiser Permanente ‘Absolutely’ Committed to ACA Marketplaces
Bob Herman, Modern Healthcare

Aetna said this week it is drastically curtailing its participation on the Affordable Care Act’s insurance exchanges. But one of the largest not-for-profit health insurers does not plan on abandoning them anytime soon. Kaiser Permanente, the $61 billion system that includes health plans, hospitals and medical groups, is “absolutely” sticking with the exchanges over the long term, Kaiser CEO Bernard Tyson told Modern Healthcare on Wednesday.

Clinton Pushed From Left and Right on Health Care
Laura Meckler, The Wall Street Journal

Aetna Inc.’s decision to scale back participation in the Affordable Care Act’s exchanges is putting new pressure on Hillary Clinton over health care, a onetime signature issue that has taken a back seat in her presidential campaign. The pressure is coming from the right but also the left.

Dems Doubtful of Sanders’ Health Push
Sarah Ferris, The Hill

Sen. Bernie Sanders’s (I-Vt.) renewed push for a government-run healthcare plan is getting a tepid reception from Democrats, with some saying he is waging a losing battle. Long-time “public option” supporters like Sanders believe Aetna’s decision to flee the ObamaCare marketplaces this week proves what they’ve been saying all along: that the time has come for a new government-run healthcare plan in the United States.

Obamacare Marketplace Shakeout Rocks Arizona, Southeast
Phil Galewitz, Kaiser Health News

Some of the Affordable Care Act’s insurance marketplaces are in turmoil as the fourth open enrollment season approaches this fall, but what’s ahead for consumers very much depends on where they live. Competition on these exchanges will be diminished next year when three of the nation’s largest health insurers — Aetna, UnitedHealthcare and Humana — will sell individual plans in many fewer markets.

Former Health-Care Investment Banker Convicted of Tipping His Father on Deals
Christopher Matthews, The Wall Street Journal

A former managing director at Perella Weinberg Partners LP was convicted Wednesday of insider trading on allegations he tipped his father on pending health-care deals. A jury in Manhattan federal court convicted Sean Stewart on nine counts of securities fraud and other charges after six days of deliberations.


AHA Maintains Surplus Amid Policy Wins and Leadership Change
Dave Barkholz, Modern Healthcare

The American Hospital Association stayed within budget as it won some key policy battles and changed senior leadership in 2015. Long-time CEO Richard Umbdenstock, who retired at year end, received compensation of $2.1 million in 2015, including a base salary of $930,860, according to the association’s 2015 annual Form 990 financial filing with the Internal Revenue Service.

With Little Known About Zika Virus, Hospitals Scramble To Stay Ahead
Andrew Joseph, Stat

The threat of Zika virus is reshaping operations at hospitals across the country, as medical teams rush to figure out how best to provide care for pregnant women with the disease and monitor and treat babies with related brain damage. With scientists still trying to better understand the virus — and without any treatments available — hospitals have been forced to adapt to a changing Zika outbreak, particularly in states such as Florida, Texas, and New York that are at risk for local transmission or have seen large numbers of travel-related cases.

Pharma, Biotech & Device

Clinton Vows To Take On High Cost Prescription Drugs
Naomi Jagoda, The Hill

Hillary Clinton on Wednesday pledged to work to lower prescription drug costs, saying it’s not fair for Americans to be charged higher prices for medications than people in other countries. “Let’s be clear, your tax dollars help support the research that is used to create those drugs in the first place,” Clinton said a campaign event in Cleveland.

Valeant Shares Gain as Once-Burned Analysts Regain Optimism
John Lauerman, Bloomberg News

Stock analysts are starting to come back around to Valeant Pharmaceuticals International Inc. after being burned by the company over the last year. The drugmaker’s stock reached $29.89, its highest level since May, on Wednesday after two analysts raised their ratings and issued new price targets this week.

California Senator Withdraws ‘Gutted’ Drug Price Transparency Bill
Ed Silverman, Stat

Aclosely watched effort in California to pass a bill that would require drug makers to explain their price hikes has been scuttled. The decision came after amendments were made during an assembly committee hearing last Friday that sources told us “effectively gutted” the legislation.

Merck Enters Race For Cancer Drugmaker Medivation
Carl O’Donnell and Greg Roumeliotis, Reuters

Merck & Co Inc is one of at least five pharmaceutical companies that submitted indications of interest in buying U.S. cancer drug company Medivation Inc earlier this month, according to people familiar with the matter. The strong interest in Medivation illustrates how demand for new cancer treatments, which can possibly add years to patients’ lives, could mean billions of dollars in revenue to the companies that own them.

Court Says Pfizer’s Biosimilar of J&J’s Remicade Doesn’t Infringe Patent
Maria Armental, The Wall Street Journal

Pfizer Inc.’s lower-priced version of Johnson & Johnson’s blockbuster autoimmune disease drug Remicade doesn’t infringe a patent, a federal court ruled on Wednesday, potentially clearing the way for the drug’s sale in October. J&J said it would appeal the decision and affirmed its sales projections.

Donald Trump’s Trade Talk Is Making The Drug Industry Uneasy
Dylan Scott, Stat

The drug industry is quietly troubled over Donald Trump’s tough talk on trade. The Republican presidential nominee has promised to aggressively renegotiate America’s trade deals — and to tear them up if need be.

Health IT

Surescripts: E-Prescribing of Controlled Substances Jumps 600 Percent
Susan D. Hall, Fierce Healthcare

The number of transactions over the Surescripts network increased by 48 percent in 2015, according to the company’s 2015 National Progress Report. Surescripts performed 9.7 billion secure health data transactions in 2015, including 1.4 billion electronic prescriptions, 1.05 billion medication histories and 15.3 million clinical messages.

Former Federal Policy Official Says Patient Consent Could Close Gaps in Health Data Privacy
Joseph Conn, Modern Healthcare

Giving patients greater access to and more control over their health information could improve privacy protection, a former federal policy official concludes in a Bloomberg opinion piece. The private sector needs to fill the gaps in health information privacy protection left by the Health Insurance Portability and Accountability Act and exacerbated by new, consumer-oriented health and wellness computer applications, they say.

A Message from PhRMA:

Do you feel like your medicines are just out of reach? If you’re uninsured or underinsured, the Partnership for Prescription Assistance may be able to help. Sponsored by America’s biopharmaceutical research companies, PPA is a free, confidential service that helps those in need. Since 2005, it’s helped nearly ten million patients access programs that provide prescription medicines for free or nearly free. To learn more about PPA, visit

Opinions, Editorials & Perspectives

It’s Time Everyone Is Accountable in Vision Care
Andrea Thau, Morning Consult

Most people’s biggest health fear is losing their vision. From babies to seniors, people rely on their vision for reading, driving, sports, work — nearly everything they do during waking hours.

Aetna’s Warning For Obamacare
The Editorial Board, Bloomberg News

The news that Aetna will stop selling health insurance on the public exchanges in 11 states may not be catastrophic for the Affordable Care Act. The company covers only 8 percent of Obamacare enrollees, after all, and Aetna’s job-based health insurance business was perhaps never well-suited to building low-cost networks for individual customers.

Fix The Law’s Critical Problems: Another View
Marilyn Tavenner, USA 

For decades, America has made a commitment to provide affordable insurance coverage to those who need it most. From helping our seniors by implementing Medicare Advantage and the Part D prescription drug program, to helping struggling families and expanding insurance to kids, America’s health insurance plans provide critical coverage that millions rely on every day.

The Aetna Mugging
The Editorial Board, The Wall Street Journal

Democrats claimed for years that ObamaCare is working splendidly, though anybody acquainted with reality could see the entitlement is dysfunctional. Now as the law breaks down in an election year, they’ve decided to blame private insurers for their own failures.

A Message from PhRMA:

Do you feel like your medicines are just out of reach? If you’re uninsured or underinsured, the Partnership for Prescription Assistance may be able to help. Sponsored by America’s biopharmaceutical research companies, PPA is a free, confidential service that helps those in need. Since 2005, it’s helped nearly ten million patients access programs that provide prescription medicines for free or nearly free. To learn more about PPA, visit

Research Reports, Issue Briefs & Case Studies

Who Are the Remaining Uninsured and Why Haven’t They Signed Up for Coverage?

Sara Collins et al., The Commonwealth Fund

The number of uninsured people in the United States has declined by an estimated 20 million since the Affordable Care Act went into effect in 2010. The percentage of the population without health insurance has fallen to historic lows.

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