Category: Rehab News

Letters to the Editor is a periodic feature. We welcome all comments and will publish a selection. We edit for length and clarity and require full names.

Clarifying the FDA’s Role and Authority Over Direct-to-Consumer Drug Ads

While several inaccuracies in the recent opinion piece about direct-to-consumer prescription drug advertisements by KFF Health News’ Elisabeth Rosenthal have been corrected in response to FDA’s direct requests, in this letter the FDA seeks to provide additional information about the agency’s oversight to readers and correct any misimpressions that may remain (“Perspective: With TV Drug Ads, What You See Is Not Necessarily What You Get,” Sept. 9). The FDA is strongly committed to protecting public health by ensuring prescription drug promotion by or on behalf of a drug manufacturer, distributor, or packer is truthful, balanced, and accurately communicated.

Federal law has long required prescription drug advertisements to present a true statement regarding the side effects, contraindications, and effectiveness associated with the advertised prescription drug (with information relating to major side effects and contraindications referred to as the “major statement” in TV or radio ads). This requirement has been in place for many decades and helps to ensure a truthful and non-misleading presentation of information about the prescription drug, as well as a balanced presentation of safety and efficacy information.

In 2023, the FDA issued a final rule establishing five standards to help ensure that the major statement in ads for human prescription drugs in TV/radio format is presented to consumers in a clear, conspicuous, and neutral manner. The aforementioned article suggests it is unclear how to determine whether an advertisement complies with this rule. However, the rule and the FDA’s plain language guidance pointedly outline specific criteria for each standard in order for the ad to be considered compliant. The FDA believes these standards will help consumers better understand the advertised drug’s side effects, so they are better informed when they participate in health care decision-making. Companies have until Nov. 20, 2024, to bring ads into compliance.

Additionally, the article does not discuss one of the agency’s crucial post-marketing surveillance tools for prescription drug ads. Federal law generally does not require companies to submit promotional communications prior to use, but companies are required to submit ads at the time of initial dissemination. These submissions, in addition to other tools like the Bad Ad program, greatly aid the FDA’s surveillance of promotional activities.

The FDA takes seriously its responsibility to monitor prescription drug ads and to ensure they are compliant with FDA’s applicable laws and regulations. We will continue to monitor and take appropriate action if prescription drug advertisements are found to contain false or misleading information.

— Catherine Gray, director of the FDA’s Office of Prescription Drug Promotion, Washington, D.C.

Jerry Berger, formerly the director of media relations at a Harvard Medical School teaching hospital, shared the article on the social platform X:

— Jerry Berger, Boston

How to Raise the Cybersecurity Bar

I just finished reading the article “Cyberattacks Plague the Health Industry. Critics Call Feds’ Response Feeble and Fractured” (Sept. 19), and while it is on point in terms of the inadequacy of the federal cybersecurity management, I think it should have gone deeper into outlining other creative options to raise the cybersecurity bar among all health care providers. Similar to the adoption of electronic health records, provider cyber-preparedness needs an economic infusion of technology and resources; a “Meaningful Use”-like program if you will (but, hopefully, better defined and implemented!). The federal government also needs to take a more active role in applying “offensive resources” to neutralize threats when they arise and before they expand across the health care ecosystem.

— Robert Swaskoski, vice president of enterprise risk management for Heritage Valley Health System, Sewickley, Pennsylvania

An employee benefits specialist outside Atlanta chimed in on social media:

— Catherine Collingwood Estes, Duluth, Georgia

Dave Lantz is no stranger to emergency department or doctor bills. With three kids in their teens and early 20s, “when someone gets sick or breaks an arm, all of a sudden you have thousand-dollar medical bills,” Lantz said.

The family’s health plan that he used to get as the assistant director of physical plant at Lycoming College, a small liberal arts school in central Pennsylvania, didn’t start to cover their costs until they had paid $5,600 in medical bills. The Lantzes were on the hook up to that annual threshold. The high-deductible plan wasn’t ideal for the family of five, but it was the only coverage option available to them.

Things are very different now. In mid-2022, the college ditched its group health plan and replaced it with a new type of plan — an individual coverage health reimbursement arrangement, or ICHRA.

Now Lantz gets a set amount from his employer every month that he puts toward a family plan on the individual insurance market. He opted for a zero-deductible plan with a richer level of coverage than the group plan. Though its $790 monthly premium is higher than the $411 he used to pay, he ends up saving money overall by not having to pay down that big deductible. Plus, he now has more control over his health spending.

“It’s nice to have the choice to balance the high deductible versus the higher premium,” Lantz said. Before, “it was tough to budget for that deductible.”

As health insurance costs continue to rise, employers are eyeing this type of health reimbursement arrangement to control their health care spending while still providing a benefit that workers value. Some consumer advocates are concerned the plans could result in skimpier, pricier coverage for certain consumers, especially sicker, older ones.

The plans allow employers to make tax-preferred contributions to employees to use to buy coverage on the individual market. Employers thus limit their financial exposure to rising health care costs. Everybody wins, say backers of the plans, which were established in 2019 as part of a group of proposals the Trump administration said would increase health insurance choice and competition.

“It’s a way to offer coverage to more diverse employee groups than ever before and set a budget that controls costs for the companies,” said Robin Paoli, executive director of the HRA Council, an advocacy group.

Some health insurance specialists say the plans aren’t necessarily a good option for consumers or the individual insurance market. Even though the rules prevent employers from offering this type of coverage to specific workers who may be sicker and more expensive to cover than others, employers with relatively unhealthy workforces may find the arrangements appealing. This, in turn, may drive up premiums in the individual market, according to an analysis by the University of Southern California-Brookings Schaeffer Initiative for Health Policy.

Plans sold on the individual market often have smaller provider networks and higher deductibles than employer-sponsored coverage. Premiums are often higher than for comparable group coverage. Workers, especially lower-wage ones, might be better off financially with premium tax credits and cost-sharing reductions to buy an Affordable Care Act marketplace plan, but using the work-based ICHRA benefit would disqualify them.

“From a worker perspective, the largest impact is that being offered affordable coverage by your employer makes you ineligible for marketplace subsidies,” said Matthew Fiedler, a senior fellow at the Brookings Institution who co-authored the analysis of the rule establishing the plans.

The plans are currently offered to only a tiny slice of workers: an estimated 500,000 of the roughly 165 million people with employer-sponsored coverage, according to the HRA Council. But interest is growing. The number of employers offering ICHRAs and an earlier type of plan, called qualified small-employer HRAs, increased 29% from 2023 to 2024, according to the council. And, although small employers have made up the bulk of adopters to date, larger employers with at least 50 workers are the fastest-growing cohort.

Individual market insurers like Oscar Health and Centene see opportunities to expand their footprint through the plans. Some venture capitalists are touting them as well.

“The [traditional group] health insurance cornerstone from 60 years ago has outlived its usefulness,” said Matt Miller, whose Headwater Ventures has invested in the ICHRA administrator Venteur. “The goal is to ensure people have coverage, detaching it from the employment construct and making it portable.”

Employers can offer this type of health reimbursement arrangement to some classes of employees and group plans to others based on characteristics such as geography, full-time vs. part-time status, or salaried vs. hourly pay.

Lycoming College wasn’t aiming to be on the cutting edge when it made this coverage switch. Faced with a 60% premium increase after some members had high claims, the school, which covers roughly 400 faculty and staff and their family members, needed to look at alternatives, said Kacy Hagan, its associate vice president for human resources and compliance.

In the end, they opted to offer ICHRA coverage to any employee who worked at least 30 hours a week.

In the first year of offering the new benefit, the college saved $1.4 million in health care costs over what they would have spent if they’d stayed with its group plan. Employees saved an average of $1,200 each in premiums.

“The finance folks really like it,” Hagan said. As for employees, “from a cost standpoint, people tend to be pretty happy with it, and people really like having a choice of plans,” she said. However, there have been issues with the plan’s administration. Some employees’ coverage was dropped and had to be reinstated, she said. Those problems have been largely resolved since they switched plan administrators this year.

This coverage arrangement can be complicated to manage. Instead of a company paying one group health plan premium, dozens of individual health insurers may need to be paid. And employees who’ve never shopped for a plan before need help figuring out what coverage works for them and signing up.

The complexity can be off-putting. This year, a number of companies that have tried this type of health reimbursement arrangement decided they’d rather go back to a group plan, said Tim Hebert, managing partner of Sage Benefit Advisors, based in Fort Collins, Colorado.

“They say, ‘Employees are all over the place in different plans, and they don’t feel like they’re being taken care of,’” Hebert said.

Vendors continue to crop up to help employers like Lycoming College and their workers manage their plans.

“If you just say, ‘Here’s $1,000,’ it’s extremely discombobulating and confusing,” said Jack Hooper, CEO of Take Command Health, which now administers the Lycoming ICHRA.

It’s unclear whether the plans will take off or remain a niche product.

“It’s a big disrupter, like 401(k)s,” said Mark Mixer, board chair of the HRA Council and CEO of HealthOne Alliance in Dalton, Georgia. Still, it’s not for everyone. “It’s simply another tool that employers should consider. When it fits, do it.”

This article was produced by KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. 

Soon after the U.S. Supreme Court issued its Roe v. Wade abortion ruling in 1973, Laura Esserman used her high school graduation speech to urge her classmates to vote for the Equal Rights Amendment to expand women’s access to property, divorce, and abortion.

Five decades later, with 14 states banning abortion in almost all circumstances, the University of California-San Francisco breast cancer surgeon has once again taken up the fight for women’s reproductive rights. Since 2021, when Texas prohibited most abortions, she has boycotted the San Antonio Breast Cancer Symposium — a conference she had regularly attended, and frequently headlined, for 34 years.

“People are passing laws that are legislating what should be a medical decision,” she said. “And I am objecting in whatever way I can.”

Esserman and other physicians have urged their colleagues and medical societies to move all professional meetings out of states that criminalize abortion. Short of a move, they have called for boycotts of the events.

In November, Esserman expects 300 health providers and researchers to meet in San Francisco for an alternative breast cancer conference.

The effort to move annual conferences — which pump substantial revenue into local communities and attract many of the nation’s 1.1 million physicians and other medical professionals looking to network, satisfy continuing education requirements, and learn about the latest developments in their fields — has led to some notable relocations.

The American College of Obstetricians and Gynecologists moved its 2023 annual meeting and an estimated 4,000 participants from New Orleans to Maryland in response to Louisiana’s abortion ban. An estimated 3,600 health care professionals attended the American Association of Immunologists’ conference in Chicago this year, after the group moved the meeting from its planned Phoenix location in response to Arizona’s restrictive abortion law.

“In addition to causing great physical and psychological harm to patients,” the association said in a statement, abortion bans “threaten irreparable damage to the private and trusted relationship between medical professionals and their patients.”

Yet even doctors who agree about reproductive rights disagree about how to express dissent. Some argue it’s more important than ever to visit states where abortion has been outlawed, to learn about the issues surfacing because of the laws, and to help people organize against them.

“We cannot support penalizing communities that are already harmed by this legislation,” said obstetrician and gynecologist Jamila Perritt, president and CEO of Physicians for Reproductive Health. “As opposed to withdrawing support, what we’re calling for is actually flooding those folks with support.”

Physicians for Reproductive Health has been providing security for doctors targeted by anti-abortion activists, Perritt said, and training doctors to teach abortion care in abortion-restricting states and to testify to state legislatures about the need for abortion access.

“There is a lot to be gained by coming to these states, supporting us, seeing the reality, and bringing these conversations into your conference space so that you can better understand our reality, rather than just boycotting that state completely, which is not helpful,” said Bhavik Kumar, chief medical officer for Planned Parenthood of Greater Ohio and a medical director for Planned Parenthood Gulf Coast in Texas and Louisiana.

Since the Supreme Court’s 2022 decision to overturn Roe and eliminate a federal constitutional right to abortion, all but nine states and Washington, D.C., have imposed abortion restrictions, according to the Guttmacher Institute.

The San Antonio Breast Cancer Symposium continues to be held in Texas, where abortion is banned in almost all instances, and boycott calls do not appear to have slowed turnout. In fact, the number of in-person attendees increased from just under 8,000 in 2019 to 8,220 last year, organizers said.

Breast oncologist Virginia Kaklamani, a University of Texas Health Science Center-San Antonio professor of medicine who co-directs the San Antonio symposium, plans to stay in Texas. She doesn’t believe in boycotts, though she does share boycott proponents’ concerns. Despite exceptions, such as the American Association of Pro-Life Obstetricians and Gynecologists, doctors have by and large spoken against abortion restrictions.

“I think the way to handle it is to talk to our elected officials, to go out and vote. Moving meetings from one place to another is not going to help,” Kaklamani said. “You stay and you fight for your patients.”

Esserman recognizes that boycott calls have not had significant impact, but she feels compelled to keep applying pressure anyway.

She can’t help but think about a patient who recently came to her San Francisco practice nine weeks pregnant and with an aggressive breast cancer. If she were to continue the pregnancy, she would be ineligible for the most effective treatment. “Where I live, she has a choice,” Esserman said. In some states, she would have no choice but to carry the pregnancy to term.

Cary Gross, a Yale School of Medicine professor who co-authored a JAMA Internal Medicine opinion piece last year advocating boycotts, cited three arguments: expressing the profession’s values, acting as an ethical consumer, and protecting the health of attendees. Women physicians of childbearing age have voiced fears about traveling to anti-abortion states, especially while pregnant.

“The legislators passing these laws are probably not going to change their stance,” Gross said. “But for the general population, the more you can do to alert people, to remind people there’s another way, you have to make your voice heard.”

Still, Gross, Esserman, and others pushing for boycotts can point to no evidence that their efforts have changed hearts and minds, let alone laws.

Instead of moving the American Society of Hematology’s 2022 meeting out of New Orleans after Louisiana imposed a trigger law to ban abortion, Jane Winter, the society’s president at the time, met with Louisiana’s then-governor, John Bel Edwards, and told him about women whose survival might depend on getting an abortion. They talked about her 22-year-old patient who had Hodgkin lymphoma and learned she was pregnant just before a planned stem cell transplant.

“Gov. Edwards was visibly moved by our clinical cases and shared that lawmakers had not considered the impact of abortion restrictions on the care of our patients,” Winters wrote in a column for The Hematologist.

Last year, the hematologists held their meeting in San Diego, and they will meet again in California, which has no post-Roe abortion restrictions, in December.

In an email, Winter said her conversation with Edwards changed nothing concrete, as far as she knows. But she added, “I do believe that telling the stories of specific individuals – in my case, those of my patients – is one way to begin to change minds.”

SIKESTON, Mo. — At age 79, Nannetta Forrest, whose father, Cleo Wright, was lynched in Sikeston, Missouri, before she was born, wonders how the decades-long silence that surrounded his death in 1942 influenced her life.

In 2020, Sikeston police killed another young Black man, 23-year-old Denzel Taylor. Taylor’s shooting death immediately made local headlines, but then the cycle of silence in Sikeston repeated itself.

Host Cara Anthony and pediatrician Rhea Boyd draw health parallels between the loss experienced by two families nearly 80 years apart. In both cases, young daughters were left behind to grapple with unanswered questions and devastating loss.

“Regardless of the age, children experience longing,” Boyd said. “They miss people when they don’t see them again; even babies can experience that.”

[Editor’s note: A swear word is bleeped out in this episode. The time stamp is 12:03.]

Host

The “Silence in Sikeston” podcast is a production of KFF Health News and WORLD. Distributed by PRX. Subscribe and listen on Apple Podcasts, Spotify, Amazon Music, iHeart, or wherever you get your podcasts.

Watch the accompanying documentary from WORLD, Retro Report, and KFF starting Sept. 16, here.

To hear other KFF Health News podcasts, click here.

This article was produced by KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. 

In June 2019, Lija Greenseid handed Minnesota Gov. Tim Walz an empty vial of insulin that her 13-year-old daughter had painted gold.

Greenseid’s daughter has Type 1 diabetes, which means she requires daily injections of manufactured insulin to stay alive. The price of a single vial of insulin rose by about 1,200% between 1996 and 2018, and the gold vial was a reminder, Greenseid said, that this lifesaving pharmaceutical shouldn’t be as expensive as precious metal.

“What I heard is that that gold vial remained on his desk at the governor’s office, and he brought it up throughout that summer and fall when he was trying to talk to legislators to get them moving,” Greenseid said.

Ten months later, in April 2020, Walz signed the Alec Smith Insulin Affordability Act. The law was named after the 26-year-old Minnesotan whose 2017 death from rationing insulin became a catalyst for the patient advocates who turned the high cost of insulin in the U.S. into a national political priority.

Now it’s an issue in the presidential campaign. Both former President Donald Trump and Vice President Kamala Harris and her running mate, Walz, have sought to appeal to the nation’s 8.4 million insulin users and their families by touting policies that make insulin cheaper for some patients.

But advocates for diabetes patients fret that neither presidential candidate would go as far as Walz’s Minnesota law, which helps patients even if they are uninsured, despite the law being under legal attack by the drug industry.

The landscape on insulin pricing has already changed significantly in the past five years. One month after Walz signed the Minnesota law, the Trump administration announced a voluntary program for Medicare prescription drug plans to cap copayments for some insulin products at $35. Two years later, President Joe Biden signed a law requiring all Medicare drug plans to cap copayments for insulin at $35 a month.

Now, amid the current presidential campaign, Harris has proposed extending that $35 cap on insulin copayments to Americans with commercial health insurance.

The Trump campaign’s national press secretary, Karoline Leavitt, touted his efforts on prescription drug prices when he was in the White House, including approval of a pathway for prescription drugs to be imported from Canada as well as the voluntary $35 insulin Medicare copayment cap. But she did not offer new insulin-specific initiatives for his possible second stint as president.

“President Trump will finish what he started in his first term,” Leavitt wrote in a statement.

Copayment caps, which have been enacted by 25 states, are popular policies because they provide an immediate financial benefit that many patients see at the pharmacy, according to University of Southern California economist Neeraj Sood. They’re also relatively easy to implement.

But copayment caps don’t address the high list price of insulin itself, so uninsured patients don’t benefit from such rules. About 1 in 12 Americans lacked health insurance last year.

That’s what makes Minnesota’s insulin safety net different. The system has two parts: an emergency program that allows individuals to get a one-time, 30-day supply of insulin for $35, and a continuing need program that provides insulin to eligible patients for a year at no more than $50 for a 90-day supply.

By contrast, list prices for a 30-day supply of insulin can easily top $215, depending on the insulin.

The bill that created Minnesota’s program was bipartisan out of necessity. Republicans controlled the state Senate at the time, while the Minnesota Democratic-Farmer-Labor Party held the House and governor’s office.

Nicole Smith-Holt, whose son the bill was named after, watched in tears as it finally passed the state legislature in 2020.

“I was happy. I was relieved,” Smith-Holt said. “I was sad that it took Alec dying to get to the point where people could walk into the pharmacy and pick up their prescription for an affordable price.”

But because Minnesota’s program requires insulin manufacturers to provide the insulin, it has prompted a backlash from manufacturers. Pharmaceutical industry lobbying group PhRMA filed a lawsuit in 2020 to block the Minnesota law, arguing it violates the “takings clause” of the U.S. Constitution, which says private property can’t be taken for public use “without just compensation.”

That suit is ongoing, yet the state program is up and running and by the end of 2023 it had been used over 1,500 times.

PhRMA spokesperson Reid Porter said his group is committed to helping patients afford medicines. Insulin makers voluntarily dropped list prices last year and now offer patient assistance programs for affording the drugs. And the CEO of insulin maker Eli Lilly first proposed the voluntary Medicare copay cap Trump announced in 2020.

Porter said insulin costs have been driven up by insurance companies and pharmacy benefit managers, also known as PBMs — the middlemen between insurance plans or employers and drug manufacturers — when they pocket the discounts from the list price of drugs that they negotiate with manufacturers.

“Minnesota’s insulin program does not solve this problem and is unconstitutional,” Porter said. “This is not how the system should work, and why it’s critical that policymakers should prioritize reforming the PBM system, a solution that puts patient health over politics.”

In 2021, Sood co-authored a study that found that, despite insulin list prices rising between 2014 and 2018, income received by drugmakers decreased while increasing for intermediaries like PBMs and pharmacies.

In September, the Federal Trade Commission announced a lawsuit against the nation’s three biggest PBMs, alleging they created a system that inflated insulin prices. The companies denied the claims.

Jing Luo, a physician at the University of Pittsburgh, said that regardless of who wins in November he doesn’t expect existing insulin policies like Medicare’s popular copay cap to be rolled back, due in part to the advocacy of people like Smith-Holt and Greenseid.

“They’ve been really effective at tying high insulin prices with really bad, morally repugnant outcomes,” Luo said.

The key in Minnesota was including real stories, Greenseid said.

“We had enough real people who reached out and had conversations and helped to show politicians the extent of the problem,” Greenseid said, “and they listened.”

This article was produced by KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. 

Nearly 90% of babies who had to be hospitalized with covid-19 had mothers who didn’t get the vaccine while they were pregnant, according to new data released by the Centers for Disease Control and Prevention. The findings appear in the agency’s Morbidity and Mortality Weekly Report.

Babies too young to be vaccinated had the highest covid hospitalization rate of any age group except people over 75.

The study looked at infant medical data from October 2022 to April 2024 in 12 states and underscores the critical importance of vaccinating pregnant people. It also echoes what physicians have anecdotally reported for more than three years — that people are still skeptical of covid vaccines due to persistent misinformation.

Of the 1,470 infants sick enough to be hospitalized due to covid, severe outcomes occurred “frequently,” according to the report. Excluding newborns hospitalized at birth, about 1 in 5 infants hospitalized with covid required intensive care, and nearly 1 in 20 required a ventilator.

“These aren’t necessarily high-risk, ill newborns. These are just regular, full-term, healthy newborn kids who happen to get covid and wind up on a ventilator in the hospital,” said Neil Silverman, a professor of clinical obstetrics and gynecology and the director of the Infectious Diseases in Pregnancy Program at the David Geffen School of Medicine at UCLA.

Babies can’t get the covid vaccination until they are at least 6 months old. That leaves a “huge window” when infants are most vulnerable, Silverman said. Vaccinating pregnant women so they pass the antibodies on to their newborns is an effective way of protecting babies during that time. Vaccination during pregnancy also protects pregnant people from severe disease.

But persistent vaccine misinformation online has led to skepticism among Silverman’s pregnant patients.

“The most frustrating response that I get from folks is that they need to do more research before they think about getting the covid vaccine,” Silverman said. “We have dozens and dozens of studies showing the safety of the mRNA vaccine. I don’t know how much more research we can provide to skeptics.”

Among the 1,000-plus babies hospitalized with covid, the median age was just 2 months old, according to the report. Nine of the infants died.

South Carolina pediatrician Deborah Greenhouse said she plans to share the study with families she cares for. “There absolutely is a proportion of the population who will look at this and say, ‘Hey, wow, I should get that vaccine. It could protect my baby,’” she said.

Greenhouse believes the new data could solidify the risk of skipping the vaccine when she speaks to families.

“I think that it might help to convince some parents when you can actually show them hospitalization numbers and you can show them intensive care numbers and you can show them mechanical ventilation numbers,” Greenhouse said. “Those things are a big deal.”

Often, Greenhouse waits to be informed that a person is pregnant before bringing up the updated covid shot. Now she’s rethinking that strategy. “As pediatricians we do get moms in our office who are pregnant and we have an opportunity to intervene and to do some education and make them understand how important this is,” she said.

Physicians can encourage vaccination by making it as easy and simple as possible, Silverman said. He encouraged fellow doctors to offer the shots in their offices, rather than sending patients to pharmacies or other providers.

“We lose probably 30 to 40% of vaccination opportunities once someone has to leave the office to get a vaccine,” Silverman said.

But offering covid shots in their clinics leaves some doctors with a difficult calculation. They are struggling to predict how many patients will be interested in the vaccine and may not be able to return all their excess doses. Many providers can’t afford to lose money on doses that won’t be used, but they still need to order enough to vaccinate vulnerable patients who want the shot.

This article was produced by KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. 

Federal officials resolved more than a decade ago to crack down on whopping government overpayments to private Medicare Advantage health insurance plans, which were siphoning off billions of tax dollars every year.

But Centers for Medicare & Medicaid Services officials have yet to demand any refunds — and over the years the private insurance plans have morphed into a politically potent juggernaut that has signed up more than 33 million seniors and is aggressively lobbying to stave off cuts.

Critics have watched with alarm as the industry has managed to deflate or deflect financial penalties and steadily gain clout in Washington through political contributions; television advertising, including a 2023 Super Bowl feature; and other activities, including mobilizing seniors. There’s also a revolving door, in which senior CMS personnel have cycled out of government to take jobs tied to the Medicare Advantage industry and then returned to the agency.

Sen. Chuck Grassley (R-Iowa) said Medicare Advantage fraud “is wasting taxpayer dollars to the tune of billions.”

“The question is, what’s CMS doing about it? The agency must tighten up its controls and work with the Justice Department to prosecute and recover improper payments,” Grassley said in a statement to California Healthline. “Clearly that’s not happening, at least to the extent it should be.”

David Lipschutz, an attorney with the Center for Medicare Advocacy, a nonprofit public interest law firm, said policymakers have an unsettling history of yielding to industry pressure. “The health plans throw a temper tantrum and then CMS will back off,” he said.

Government spending on Medicare Advantage, which is dominated by big health insurance companies, is expected to hit $462 billion this year.

New details of the government’s failure to rein in Medicare Advantage overcharges are emerging from a Department of Justice civil fraud case filed in 2017 against UnitedHealth Group, the insurer with the most Medicare Advantage enrollees. The case is pending in Los Angeles. The DOJ has accused the giant insurer of cheating Medicare out of more than $2 billion by mining patient records to find additional diagnoses that added revenue while ignoring overcharges that might have reduced bills. The company denies the allegations and has filed a motion for summary judgment.

Records from the court case are surfacing as the Medicare Advantage industry ramps up spending on lobbying and public relations campaigns to counter mounting criticism.

While critics have argued for years that the health plans cost taxpayers too much, the industry also has come under fire more recently for allegedly scrimping on vital health care, even dumping hundreds of thousands of members whose health plans proved unprofitable.

“We recognize this is a critical moment for Medicare Advantage,” said Rebecca Buck, senior vice president of communications for the Better Medicare Alliance, which styles itself as “the leading voice for Medicare Advantage.”

Buck said initiatives aimed at slashing government payments may prompt health plans to cut vital services. “Seniors are saying loud and clear: They can’t afford policies that will make their health care more expensive,” she said. “We want to make sure Washington gets the message.”

AHIP, a trade group for health insurers, also has launched a “seven-figure” campaign to promote its view that Medicare Advantage provides “better care at a lower cost,” spokesperson Chris Bond said.

Revolving Door

CMS, the Baltimore-based agency that oversees Medicare, has long felt the sting of industry pressure to slow or otherwise stymie audits and other steps to reduce and recover overpayments. These issues often attract little public notice, even though they can put billions of tax dollars at risk.

In August, California Healthline reported how CMS officials backed off a 2014 plan to discourage the health plans from overcharging amid an industry “uproar.” The rule would have required that insurers, when combing patients’ medical records to identify underpayments, also look for overcharges. Health plans have been paid billions of dollars through the data mining, known as “chart reviews,” according to the government.

The CMS press office declined to respond to written questions posed by California Healthline. But in a statement, it called the agency a “good steward of taxpayer dollars” and said in part: “CMS will continue to ensure that the MA program offers robust and stable options for people with Medicare while strengthening payment accuracy so that taxpayer dollars are appropriately spent.”

Court records from the UnitedHealth case show that CMS efforts to tighten oversight stalled amid years of technical protests from the industry — such as arguing that audits to uncover overpayments were flawed and unfair.

In one case, Jeffrey Grant, a CMS official who had decamped for a job supporting Medicare Advantage plans, protested the audit formula to several of his former colleagues, according to a deposition he gave in 2018.

Grant has since returned to CMS and now is deputy director for operations at the agency’s Center for Consumer Information and Insurance Oversight. He declined to comment.

At least a dozen witnesses in the UnitedHealth case and a similar DOJ civil fraud case pending against Anthem are former ranking CMS officials who departed for jobs tied to the Medicare Advantage industry.

Marilyn Tavenner is one. She led the agency in 2014 when it backed off the overpayment regulation. She left in 2015 to head industry trade group AHIP, where she made more than $4.5 million during three years at the helm, according to Internal Revenue Service filings. Tavenner, who is a witness in the UnitedHealth case, had no comment.

And in October 2015, as CMS department chiefs were batting around ideas to crack down on billing abuses, including reinstating the 2014 regulation on data mining, the agency was led by Andy Slavitt, a former executive vice president of the Optum division of UnitedHealth Group. The DOJ fraud suit focuses on Optum’s data mining program.

In the legal proceedings, Slavitt is identified as a “key custodian regarding final decision making by CMS” on Medicare Advantage.

“I don’t have any awareness of that conversation,” Slavitt told California Healthline in an email. Slavitt, who now helps run a health care venture capital firm, said that during his CMS tenure he “was recused from all matters related to UHG.”

‘Improper’ Payments

CMS officials first laid plans to curb escalating overpayments to the insurers more than a decade ago, according to documents filed in August in the UnitedHealth case.

In a January 2012 presentation, CMS officials estimated they had made $12.4 billion worth of “improper payments” to Medicare Advantage groups in 2009, mostly because the plans failed to document that patients had the conditions the government paid them to treat, according to the court documents.

As a remedy, CMS came up with an audit program that selected 30 plans annually, taking a sample of 201 patients from each. Medical coders checked to make sure patient files properly documented health conditions for which the plans had billed.

The 2011 audits found that five major Medicare Advantage chains failed to document from 12.3% to 25.8% of diagnoses, most commonly strokes, lung conditions, and heart disease.

UnitedHealth Group, which had the lowest rate of unconfirmed diagnoses, is the only company named in the CMS documents in the case file. The identities of the four other chains are blacked out in the audit records, which are marked as “privileged and confidential.”

In a May 2016 private briefing, CMS indicated that the health plans owed from $98 million to $163 million for 2011 depending on how the overpayment estimate was extrapolated, court records show.

But CMS still hasn’t collected any money. In a surprise action in late January 2023, CMS announced that it would settle for a fraction of the estimated overpayments and not impose major financial penalties until 2018 audits, which have yet to get underway. Exactly how much plans will end up paying back is unclear.

Richard Kronick, a former federal health policy researcher and a professor at the University of California-San Diego, said CMS has largely failed to rein in billions of dollars in Medicare Advantage overpayments.

“It is reasonable to think that pressure from the industry is part of the reason that CMS has not acted more aggressively,” Kronick said.

CMS records show that officials considered strengthening the audits in 2015, including by limiting health plans from conducting “home visits” to patients to capture new diagnosis codes. That didn’t happen, for reasons that aren’t clear from the filings.

In any case, audits for 2011 through 2015 “are not yet final and are subject to change,” CMS official Steven Ferraina stated in a July court affidavit.

“It’s galling to me that they haven’t recovered more than they have,” said Edward Baker, a whistleblower attorney who has studied the issue.

“The government needs to be more aggressive in oversight and enforcement of the industry,” he said.

Senior CMS official Cheri Rice recommended in the October 2015 email thread with key staff that CMS could devote more resources to supporting whistleblowers who report overbilling and fraud.

“We think the whistleblower activity could be as effective – or even more effective – than CMS audits in getting plans to do more to prevent and identify risk adjustment overpayments,” Rice wrote.

But the handful of cases that DOJ could realistically bring against insurers cannot substitute for CMS fiscal oversight, Baker said.

“Unfortunately, that makes it appear that fraud pays,” he said.

Spending Surge

In December, a bipartisan group of four U.S. senators, including Bill Cassidy (R-La.), wrote to CMS to voice their alarm about the overpayments and other problems. “It’s unclear why CMS hasn’t taken stronger action against overpayments, despite this being a longstanding issue,” Cassidy told California Healthline by email.

In January, Sen. Elizabeth Warren (D-Mass.) and Rep. Pramila Jayapal (D-Wash.) called for CMS to crack down, including by restricting use of chart reviews and home visits, known as health risk assessments, to increase plan revenues.

Cassidy, a physician, said that “upcoding and abuses of chart review and health risk assessments are well-known problems CMS could address immediately.”

Advocates for Medicare Advantage plans, whose more than 33 million members comprise over half of people eligible for Medicare, worry that too much focus on payment issues could harm seniors. Their research shows most seniors are happy with the care they receive and that the plans typically cost them less out-of-pocket than traditional Medicare.

Buck, the spokesperson for the Better Medicare Alliance, said that as the annual open enrollment period starts in mid-October, seniors may see “fewer benefits and fewer plan choices.”

The group has ramped up total spending in recent years to keep that from happening, IRS filings show.

In 2022, the most recent year available, the Better Medicare Alliance reported expenses of $23.1 million, including more than $14 million on advertising and promotion, while in 2023, it paid for a Super Bowl ad featuring seniors in a bowling alley and left viewers with the message: Cutting Medicare Advantage was “nuts.”

Bruce Vladeck, who ran CMS’ predecessor agency from 1993 through 1997, said that when government officials first turned to Medicare managed care groups in the 1990s, they quickly saw health plans enlist members to help press their agenda.

“That is different from most other health care provider groups that lobby,” Vladeck said. “It’s a political weapon that Medicare Advantage plans have not been at all reluctant to use.”

The Better Medicare Alliance reported lobbying on 18 bills this year and last, according to OpenSecrets. Some are specific to Medicare Advantage, such as one requiring insurers to report more detailed data about treatments and services and another to expand the benefits they can offer, while others more broadly concern health care costs and services.

Proposed reforms aside, CMS appears to believe that getting rid of health plans that allegedly rip off Medicare could leave vulnerable seniors in the lurch.

Testifying on behalf of CMS in a May 2023 deposition in the UnitedHealth Group suit, former agency official Anne Hornsby said some seniors might not “find new providers easily.” Noting UnitedHealth Group is the single biggest Medicare Advantage contractor, she said CMS “is interested in protecting the continuity of care.”

This article was produced by KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. 

There’s a new morning ritual in Pinedale, Wyoming, a town of about 2,000 nestled against the Wind River Mountains.

Friends and neighbors in the oil- and gas-rich community “take their morning coffee and pull up” to watch workers building the county’s first hospital, said Kari DeWitt, the project’s public relations director.

“I think it’s just gratitude,” DeWitt said.

Sublette County is the only one in Wyoming — where counties span thousands of square miles — without a hospital. The 10-bed, 40,000-square-foot hospital, with a similarly sized attached long-term care facility, is slated to open by the summer of 2025.

DeWitt, who also is executive director of the Sublette County Health Foundation, has an office at the town’s health clinic with a window view of the construction.

Pinedale’s residents have good reason to be excited. New full-service hospitals with inpatient beds are rare in rural America, where declining population has spurred decades of downsizing and closures. Yet, a few communities in Wyoming and others in Kansas and Georgia are defying the trend.

“To be honest with you, it even seems strange to me,” said Wyoming Hospital Association President Eric Boley. Small rural “hospitals are really struggling all across the country,” he said.

There is no official tally of new hospitals being built in rural America, but industry experts such as Boley said they’re rare. Typically, health-related construction projects in rural areas are for smaller urgent care centers or stand-alone emergency facilities or are replacements for old hospitals.

About half of rural hospitals lost money in the prior year, according to Chartis, a health analytics and consulting firm. And nearly 150 rural hospitals have closed or converted to smaller operations since 2010, according to data collected by the University of North Carolina’s Cecil G. Sheps Center for Health Services Research.

To stem the tide of closures, Congress created a new rural emergency hospital designation that allowed struggling hospitals to close their inpatient units and provide only outpatient and emergency services. Since January 2023, when the program took effect, 32 of the more than 1,700 eligible rural hospitals — from Georgia to New Mexico — have joined the program, according to data from the Centers for Medicare & Medicaid Services.

Tony Breitlow is health care studio director for EUA, which has extensive experience working for rural health care systems. Breitlow said his national architecture and engineering firm’s work expands, replaces, or revamps older buildings, many of which were constructed during the middle of the last century.

The work, Breitlow said, is part of health care “systems figuring out how to remain robust and viable.”

Freeman Health System, based in Joplin, Missouri, announced plans last year to build a new 50-bed hospital across the state line in Kansas. Paula Baker, Freeman’s president and chief executive, said the system is building for patients in the southeastern corner of the state who travel 45 minutes or more to its bigger Joplin facilities for care.

Freeman’s new hospital, with construction on the building expected to begin in the spring, will be less than 10 miles away from an older, 64-bed hospital that has existed for decades. Kansas is one of more than a dozen states with no “certificate of need” law that would require health providers to obtain approval from the state before offering new services or building or expanding facilities.

Baker also said Freeman plans to operate emergency services and a small 10-bed outpost in Fort Scott, Kansas, opening early next year in a corner of a hospital that closed in late 2018. Residents there “cried, they cheered, they hugged me,” Baker said, adding that the “level of appreciation and gratitude that they felt and they displayed was overwhelming to me.”

Michael Topchik, executive director of the Chartis Center for Rural Health, said regional health care systems in the Upper Midwest have been particularly active in competing for patients by, among other things, building new hospitals.

And while private corporate money can drive construction, many rural hospital projects tap government programs, especially those supported by the U.S. Department of Agriculture, Topchik said. That, he said, “surprises a lot of people.”

Since 2021, the USDA’s rural Community Facilities Programs have awarded $2.24 billion in loans and grants to 68 rural hospitals for work that was not related to an emergency or disaster, according to data analyzed by California Healthline and confirmed by the agency. The federal program is funded through what is often known as the farm bill, which faces a September congressional renewal deadline.

Nearly all the projects are replacements or expansions and updates of older facilities.

The USDA confirmed that three new or planned Wyoming hospitals received federal funding. Hospital projects in Riverton and Saratoga received loans of $37.2 million and $18.3 million, respectively. Pinedale’s hospital received a $29.2 million loan from the agency.

Wyoming’s new construction is rare in a state where more than 80% of rural hospitals reported losses in the third quarter of 2023, according to Chartis. The state association’s Boley said he worries about several hospitals that have less than 10 days’ cash on hand “day and night.”

Pinedale’s project loan was approved after the community submitted a feasibility study to the USDA that included local clinics and a long-term care facility. “It’s pretty remote and right up in the mountains,” Boley said.

Pinedale’s DeWitt said the community was missing key services, such as blood transfusions, which are often necessary when there is a trauma like a car crash or if a pregnant woman faces severe complications. Local ambulances drove 94,000 miles last year, she said.

DeWitt began working to raise support for the new hospital after her own pregnancy-related trauma in 2014. She was bleeding heavily and arrived at the local health clinic believing it operated like a hospital.

“It was shocking to hear, ‘No, we’re not a hospital. We can’t do blood transfusions. We’re just going to have to pray you live for the next 45 minutes,’” DeWitt said.

DeWitt had to be airlifted to Idaho, where she delivered a few minutes after landing. When the hospital financing went on the ballot in 2020, DeWitt — fully recovered, with healthy grade-schoolers at home — began making five calls a night to rally support for a county tax increase to help fund the hospital.

“By improving health care, I think we improve everybody’s chances of survival. You know, it’s pretty basic,” DeWitt said.

This article was produced by KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.