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CVS Health Moves to Limit Access to Opioid Painkillers

One of the largest managers of pharmaceutical benefits in the U.S. says it will start limiting the duration and dose of some prescriptions for opioid painkillers, in an effort to combat widespread addiction.

CVS Health Corp., which administers drug benefits for employers, insurers and some state Medicaid programs, said it would limit opioid prescriptions to seven days or less for certain patients with acute pain who haven’t previously taken an opioid painkiller. That will be a big change, given that many CVS-covered…

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Jimmy Kimmel’s Failed Test

‘This is not my area of expertise.”

That’s the first intelligent thing Jimmy Kimmel has had to say about health-insurance reform.

Kimmel is a late-night comedian and the father of a beautiful three-month-old boy who was born with a congenital heart defect. Kimmel has set himself up as the conscience of the current debate over the last effort at reforming health insurance, and Washington now talks of the “Jimmy Kimmel test,” which demands that insurance companies be obliged to cover preexisting conditions without exception or penalty. Kimmel has on his television program twice called Senator Bill Cassidy, author of insurance legislation under current consideration in Congress, a liar for putting forward legislation that would not treat preexisting conditions the way Kimmel would prefer to see them treated.

We wish the very best to Jimmy Kimmel and his young son, Billy, but holding up cute babies is a dumb way to approach complex policy questions.

It should be noted that the changes considered in the Cassidy bill would have no effect whatsoever on Billy Kimmel, inasmuch as those changes deal with the coverage of preexisting conditions in insurance policies sold on the individual market. Even the most precocious babies are not generally shopping for their own insurance policies from the womb; most of them are, like Billy Kimmel, covered under their parents’ group policies — if they are covered at all. And that latter condition is, of course, what this is really all about.

The question of what to do about preexisting conditions isn’t about insurance companies suddenly deciding that they will not cover this or that medical issue for people who have maintained continuous insurance coverage, but rather is a question about what to do about uninsured people with medical conditions who have decided to seek insurance. The basic architecture of the Affordable Care Act mandates that insurance companies essentially ignore preexisting conditions when writing new policies, obliging them to insure against events that already have happened — essentially requiring them to bet big on the Falcons in Super Bowl LI. This turns insurance on its head: Insurance is a risk-mitigation tool that does not work well when the event already has happened. It creates a perverse incentive: If there is no cost for the coverage of preexisting conditions, then people have no incentive to buy insurance at all until they are sick and need the benefits. In order to mitigate that problem, the Affordable Care Act mandates that every American buy insurance and maintain coverage, a mandate that has not been robustly enforced. That means insurance pools composed of sicker and older populations — which is why we have skyrocketing health-insurance premiums and insurance companies pulling out of markets left and right.

The Affordable Care Act is a poorly designed piece of legislation. It is easy to point to charismatic beneficiaries and conclude that it has been worth the trouble, but everything looks like a winning proposition when you count only the benefits and ignore the costs. In reality, the ACA led to millions of Americans experiencing the anguishing disruption of insurance arrangements with which they are perfectly content. President Barack Obama and his Democratic allies in Congress promised substantial savings from the ACA, but in fact the opposite has been the case. Insurance today is less affordable than it was when the ACA was passed, and it is in some ways less accessible, too: Many Americans have fewer choices today than they did before the ACA — or, in many cases, have no choice in providers at all.

One of the problems with having the national discussion led by lightly informed celebrities such as Jimmy Kimmel is that people begin to believe their own rhetoric, in this case that Republican health-insurance reformers are motivated by sheer malice or by obscure financial considerations. (Never mind that the biggest financial players in this case, the insurance companies themselves, oppose current Republican reform efforts and largely supported the ACA.) That makes discussing the actual problems at hand, and potential solutions to them, difficult or impossible. Republicans made a critical mistake in 2008 and 2009 when they rejected the enterprise of health-insurance reform per se, repeatedly insisting only that “we have the finest health-care system in the world,” oblivious to the fact that a great many Americans were unhappy about that system or anxious, with good reason, about the security and cost of their own health-care benefits. Democrats are today making the same mistake: Obamacare is now sacred writ so far as they are concerned, and the prospect of revisiting it a profanity. But, of course, many Americans remain dissatisfied with the current state of health insurance, and Republicans are taking small, awkward steps toward addressing that.

It is not the case, as Kimmel and others insist, that the Graham-Cassidy bill would throw 30 million people off their insurance plans or that it would simply cut off federal funding for insurance subsidies in 2026. Such dishonest histrionics do not advance the cause of responsible health-insurance reform. It would permit the states to seek waivers from the federal preexisting-conditions regulation and experiment with different approaches of their own. Ironically, the effectiveness of the Democrats’ charge that modifying the preexisting-conditions rule would see Americans dying in the streets illustrates why such painful changes are unlikely to be proposed or to pass: Such measures are unpopular, and state governments are held democratically accountable to their people, often in a much more immediate and rigorous way than the federal government is. Experimenting with different approaches to preexisting conditions would in fact be desirable; there is no reason to suppose that the best solution for New Jersey is also the best solution for Oklahoma, and the only thing that is entirely clear about the preexisting-conditions approach put forward in the ACA is that it is not working.

Before the ACA, there were a great many Billy Kimmels whose parents had health insurance they could afford and that worked for them. Many of them no longer do. And there is no health-care system — not the ACA regime, not the Graham-Cassidy reforms, not a British-style government-monopoly system — that would in fact ensure that every child in Billy Kimmel’s situation would receive everything he might need and his parents might desire at a price they can afford. Medical services are a scarce good involving real costs and, barring the conscription of physicians, they will remain so. More market-oriented systems ration care through price, whereas public systems ration it through long waiting lists or by simple denial of services. Charlie Gard was a cute kid, too.

Graham-Cassidy contains useful and important measures.

Between the fully nationalized model of the United Kingdom and the perfect free-market system of the libertarian imagination lies a complicated reality in which insurance companies are heavily regulated and in which the consumption of medical services is heavily subsidized in direct and indirect ways. In the U.S. context, that means a number of parallel systems (individual insurance, employer-based plans, Medicare, Medicaid with many state-level variations, the VA system, etc.) and an ongoing federal reform effort that is complicated by the fact that insurance companies are regulated primarily at the state level. We do not have a health-care system: We have dozens and dozens of them. That is not going to be sorted out by a late-night comedian or two and sympathetic appeals about sick children.

It is not going to be sorted out entirely by Graham-Cassidy, either, though the bill contains useful and important measures. The bill does not, contra the claims of President Donald Trump, represent the repeal and replacement of Obamacare. It is a package of piecemeal reforms, some of which — repealing the employer mandate, expanding access to low-cost catastrophic plans, and block-granting Medicaid funds — are very desirable. That may not pass the “Kimmel test,” which, in its broadest form — the idea that no one should ever go without care for financial reasons — isn’t an idea at all but only a kind of slogan. But the real-world test is the more important one. Republicans should learn from the Democrats’ ACA errors, forgoing grandiosity and paying very close attention to the details. If they manage to get it right, Billy Kimmel will thank them for it one day.

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The GOP Bill Forces States to Build Health Systems From Scratch. That’s Hard.

The language of the bill provides them with a nearly unlimited range of policy options to use the money in the service of providing health care access, and no templates or fallback options.

Republican governors from 15 states have endorsed the bill, saying that “adequately funded, flexible block grants to the states are the last, best hope to finally repeal and replace Obamacare.”

States could use the money in any number of ways: state insurance programs, subsidies for private insurance, direct payments to health providers, high-risk pools or more. They would be free to preserve the central consumer protections created by Obamacare, or to decide to allow insurers to limit benefits or charge higher prices to sicker customers than healthier ones.

The challenges would fall into two major categories. First, states would need to make political choices about what they want their system to look like. Next, they would need to submit applications, hire contractors and build new systems to run them. Neither would be easy.

The bill would make health care an active, high-stakes political debate in all 50 states. Under Obamacare, states had limited, rather binary policy choices, and even those were hard for state governments to make quickly. States had to decide whether to run their own insurance marketplaces or to let the federal government do it for them. After a Supreme Court ruling in 2012, they had a choice about whether to expand their Medicaid programs to cover more childless adults, or to stick with their prior programs. Many states took longer than two years to answer even those comparatively simple questions.


Mitt Romney, then the governor of Massachusetts, signing the state’s landmark health care bill into law in 2006.

Elise Amendola/Associated Press

Consider, for example, a state like Virginia, where a Democrat sits in the governor’s office but Republicans run the legislature. Political consensus might prove elusive. Fights could erupt even among more politically homogeneous states that support Obamacare. One house of the California legislature recently voted to adopt a single-payer health care system. The flexibility presented by the bill might open a heated debate about whether to adopt such an approach — or build something more like the Affordable Care Act, which is currently working well there. There are also the challenges of state legislative calendars: Texas’ legislature, for example, is not scheduled to convene until 2019.

“In some ways, a clean slate is much more complicated than very discrete decisions,” said Larry Levitt, an executive vice president at the Kaiser Family Foundation, a nonpartisan health research group. Mr. Levitt described the challenges facing states under this legislation as “formidable.”


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In contrast with an earlier bill from Mr. Cassidy, which offered a default option for uncertain states, there is no backup plan in the bill. The Obamacare coverage programs would disappear everywhere in 2020, and any state unable to make a plan and submit an application would be ineligible for the new grant funding. If a state succeeds in obtaining the funding but doesn’t have a functioning new system on Jan. 1, 2020, consumers and markets would be thrown into chaos.

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Under the bill’s block grant formula, Mississippi would be one of the biggest winners, eligible for substantially more health care money than it gets now. Still, Mike Chaney, the state’s insurance commissioner, said that he was wary about the change. “Which evil do you like better, the one you know or the one you don’t know?” Mr. Chaney said. “There are better ways to do this.”

Once states choose a policy approach, they would need to bring it to life. If they adopt a government-run approach, in which people can enroll in a single public health plan, they will need to develop the parameters for that program and put it out to bid. If they select something similar to Obamacare — some sort of insurance market with income-based subsidies — they will need technology systems that allow them to verify people’s eligibility and income, and link state assistance with their insurance purchases.

Most states have lengthy contracting processes, in which they must request proposals and review multiple bids before signing up vendors. Those deals would need to be in place before any software building begins. The Obama administration had nearly four years to develop and build its enrollment system,, which barely functioned at the outset.

Peter Lee, the executive director of the California marketplace, Covered California, which is considered one of the country’s most successful, said that his system was barely finished in time, and he had the ability to call up local technology C.E.O.s for advice.

Andy Slavitt, who joined the Obama administration in 2014 to help rebuild the ailing, and is strongly opposed to the Republican bill, said it would be close to impossible for most states to build meaningful systems for providing health insurance on such a timeline. “This is a fantasy document developed without the benefit of talking to people who have actually had to operationalize these things before,” he said.

Passage of the bill would set off a state rush for help from the limited group of contractors who have built big systems. Mike Leavitt, a Republican who was Secretary of Health and Human Services under George W. Bush, and a governor of Utah, now runs a consulting firm that helps states build and manage exchanges. He said he supported the general idea of giving states more power.

He was optimistic that some states could adopt out-of-the-box systems within two years, but probably not all. “There are different levels of complexity involved in states, and there’s different levels of capacity, and there’s different levels of experience,” he said.

Many experts I spoke with were confident that most states would find some way to get the federal money, given how big the stakes were. They were less sure about whether states would be able to use it in a way that would provide health coverage quickly to the people currently served by Obamacare.

“The metaphor I think about is it’s saying, ‘We’re going to continue having a freeway full of fast-moving cars, but we’re going to remove the lane line and the speed limits and say we hope things work out,’ ” Mr. Lee said.

Abby Goodnough contributed reporting.

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DC Health Department Cracks Down on Dogs on Bar and Restaurant Patios

Andy Pants has been evicted from his beer garden dog house. Peyton Sherwood, owner of the Midlands in Park View, says a DC Department of Health inspector paid him a visit yesterday and told him that his bar dog, and all other dogs, would no longer be allowed at the outdoor drinking spot.

And it’s not just there. Last week, the same inspector also visited the Wonderland Ballroom, Popville reported. “They came by and left a flyer and said absolutely no animals on premise except for service animals,” the bar told the blog.

It turns out that this has long been the law. It’s just not often enforced.

“The DC Food Code prohibits animals in commercially licensed food establishments. This is not a new regulation and DOH has enforced when observed,” says DOH spokesperson Jasmine Gossett in an email. “We inspected several locations based on consumer complaints about the presence of dogs, of which Midlands was included in.”

“It’s very disappointing, because everyone loves bringing their dogs out to the patio,” Sherwood says. While he understands why it might be a good idea not to have pets inside a restaurant or bar, he doesn’t get why they should also be banned from outdoor spaces. “There are rats. There are opossums. There are raccoons and squirrels and pigeons that are all over patios in Washington, DC. But having a well taken care of, loved, and vaccinated animal on a leash is not OK.”

Sherwood says the inspector told him that someone recently complained about dogs at bars in the Washington Post. But he wasn’t able to find such an article.

Sherwood is now calling on people to contact their councilmembers and DOH Director LaQuandra Nesbitt. He’s also going to be talking with one of his Advisory Neighborhood Commission reps about starting a petition to change the law.

As for Andy Pants?

“He’s going to have to stay home in his air-conditioned apartment with his giant bed,” Sherwood says.

UPDATE (2 PM):  After hearing from a number of constituents, Councilmember Brianne Nadeau is working on emergency legislation with health committee chair Vincent Gray to address dogs on patios. “There aren’t any details to share yet,” says Tom Fazzini, Nadeau’s deputy chief of staff. “The earliest it could be up would be the Oct 3 session.”

UPDATE (4:45 PM): DOH sends a new statement: “We are aware of the concerns about the enforcement of the current health code and will review best practices and evaluate the agency’s posture on the matter.”

Jessica Sidman

Jessica Sidman covers the people and trends behind D.C.’s food and drink scene. Before joining Washingtonian in July 2016, she was Food Editor and Young Hungry columnist at Washington City Paper. She is a Colorado native and University of Pennsylvania grad.

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Only One of the Two New Health-Care Proposals Qualifies as ‘Extreme’

Will the real moderate party please stand up?

On the same day that socialist Senator Bernie Sanders (I., Vt.) introduced his “Medicare for All” health-care plan, Senators Lindsey Graham (R., S.C.) and Bill Cassidy (R., La.) introduced a last-ditch effort to sorta-kinda repeal and replace Obamacare. Despite having zero chance of being passed any time soon, Sanders’s bill grabbed the limelight for two reasons.

First, it’s a beacon of hope for the demoralized base. As a Rolling Stone headline put it, “Single-Payer Movement Shows: Life After Trump May Not Suck.” Second, Sanders got 15 co-sponsors — including some Democratic senators with presidential ambitions. The fact that so many contenders signed on to a bill that, if enacted, would throw 100 million Americans off their employer-provided health care and cost taxpayers an estimated $32 trillion over a decade revealed just how far to the left the Democratic party has moved.

And yet, to listen to Democrats and many of the journalists who love them, you’d think it was the Republican proposal that’s extreme. “In reality, Graham–Cassidy is the opposite of moderate,” New York Times columnist Paul Krugman pronounced. “It contains, in exaggerated and almost caricature form, all the elements that made previous Republican proposals so cruel and destructive.”

The news section of the Times was more even-handed: “Medicare for All or State Control: Health Care Plans Go to Extremes.”

Are they really both “extreme”? Graham–Cassidy ’s chief goal is to pare back the federalization of health-care policy by getting rid of the individual and employer insurance mandates and letting governors waive out of some regulations. More important, it block-grants Medicaid — a long-sought dream for those wanting to get a handle on out-of-control spending and debt.

A main driver of exploding health-care costs has been the way the federal reimbursement system discourages thrift. Obamacare made that problem much worse. Under Obamacare, Medicaid rolls were vastly expanded, adding millions to a faltering program. And in order to seduce states into signing up, the Feds promised to cover 100 percent of the additional costs for the first three years and no less than 90 percent in later years. If you had an expense account where someone else covered most of the tab, how eager would you be to control costs?

By giving states a lump sum, the hope is that they would experiment with cost-saving reforms that improve health-care results. Opponents of giving states the money and flexibility to innovate often seem to work from the assumption that governors and state legislatures want to harm their own citizens. Maybe they just have a better appreciation of how to help their own citizens than Washington does?

The choice for Republicans isn’t between this and a better reform. It’s between this or letting Obamacare continue intact, violating all of those repeal-and-replace promises entirely.

Graham–Cassidy is by no means perfect, and odds are it won’t pass. Democrats are locked into the position that health-care reforms can only involve more government spending and regulation. With 52 GOP senators, Graham–Cassidy can only pass if at least 50 of them vote for it, and they must do so before September 30, when the arcane budget window known as “reconciliation” closes. Because some Republican states would lose money on the deal, squishy senators such as Alaska’s Lisa Murkowski might balk, as she did with previous attempts. This is why it would be smart to emulate Obamacare (and welfare reform) and be overly generous up front with the block grants, to essentially bribe politicians into voting for it.

Meanwhile, Kentucky senator Rand Paul, who has mastered the art of supporting the status quo by voting against piecemeal improvements in the name of purity, has already indicated he will continue to play that game.

Heritage Action for America has grumbled, rightly, that Graham–Cassidy doesn’t repeal all of the Obamacare taxes. But the choice for Republicans isn’t between this and a better reform. It’s between this or letting Obamacare continue intact, violating all of those repeal-and-replace promises entirely.

That’s what’s so silly about the claim that Graham–Cassidy is as “extreme” as Sanders’s radical and shoddily written proposal (the bill is totally silent on how to pay for any of it). Graham–Cassidy is very close to the kind of legislation we would have ended up with if Republicans had an idea of what they wanted from the get-go and the Democrats were interested in compromise. But we live in a time when extremism is defined as not getting everything you want.

NR Editors: Graham-Cassidy is Worth Passing
Graham-Cassidy Is a Too-Mild Improvement on Obamacare
No to Single-Payer

— Jonah Goldberg is a fellow at the American Enterprise Institute and a senior editor of National Review. © 2017 Tribune Content Agency, LLC

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How the Latest Obamacare Repeal Plan Would Work

In the meantime, analysts say, the individual insurance markets could face enormous changes. The legislation rolls back popular consumer protections in Obamacare, leaving each state to decide what minimum benefits must be covered or if customers with pre-existing illnesses should be protected from higher prices. Not every state would drop these provisions, but several might. One of the few Obamacare requirements that would remain is to allow children to stay on their parents’ insurance policies until age 26.

The budget office has said it does not have time to analyze the full effects of the bill before the Senate hopes to consider it, though it will provide some overall estimates of its effects on the federal deficit. While a floor vote is not certain yet, Republicans are racing against the clock. They are considering the bill under special budget rules that allow them to pass it with a simple majority of votes in the Senate. That opportunity expires when the fiscal year ends at the end of Sept. 30.

The legislation also does little to stabilize the individual market from now until when the states would have to administer new health programs in 2020. Insurers are sharply raising their prices for 2018 because lawmakers have not committed to funding the so-called cost-sharing subsidies that help insurers reduce deductibles and co-payments for low-income customers. The bill does not fix this problem.


Blue States Face Biggest Cuts Under New Republican Health Care Plan

Which states would gain or lose federal funding in 2026.

The legislation also eliminates the tax penalty that people who refuse coverage face — the individual mandate — which could discourage insurance enrollment among healthier people, who are critical to making the program work. Insurance companies, some of which are only reluctantly staying in the market, may think twice about whether they need to remain while the alternatives are being worked out.

This mix of policies during the two-year transition period is similar to that imagined in earlier Republican bills. The budget office said that such an environment would cause insurance prices to spike by 20 percent and about 15 million fewer Americans to have health coverage in 2019.

The block-grant formula would affect who is covered, by shifting money to states with the greatest number of low-income residents and away from states that have tried to provide more of their middle-income citizens with insurance.

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A recent analysis from the left-leaning Center on Budget and Policy Priorities found that, by 2026, blue states with low numbers of uninsured residents, including New York and Massachusetts, would experience substantial reductions in federal funding. Poorer states with high uninsured rates, like Texas and Mississippi, would see increases. Many of the states that make out better financially could have obtained more Obamacare funding if they had chosen to expand their Medicaid programs to cover more low-income residents.

The bill’s formula shifts around the current pot of money based on how many residents in each state are close to the poverty line, and also seeks to equalize payments, regardless of differences in the price of medical care in different regions. “It redistributes from higher income to lowest income,” said Caroline Pearson, a senior vice president at Avalere Health. “It also redistributes among the states.”


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Like several earlier Republican health bills, this one would also change the structure of the 52-year-old Medicaid program, which even before Obamacare’s expansion to poor adults in many states covered tens of millions of vulnerable Americans, including poor children, older Americans in nursing homes, adults with disabilities, and many pregnant women. The program currently pays for 49 percent of all births and 64 percent of all nursing home residents’ bills.

The Graham-Cassidy bill moves funding for the Medicaid expansion population into the state block grant. It would also convert the rest of the program from an open-ended commitment of paying a share of those people’s medical bills to a capped allotment for each person every year, set to grow by a fixed amount. Independent analysts have said that the change would cause substantial shifts in financial responsibility to states, ultimately leading to reductions in benefits or in the number of Americans covered by Medicaid over time.

Most Americans receive insurance through their employers, and they, too, would probably see changes under this bill. The legislation would eliminate Obamacare’s penalties for employers that decline to offer their workers affordable coverage. The changes to benefit rules in some states could, through a complicated interplay of law and regulation, allow insurers to impose annual or lifetime limits on coverage for some people covered under employer plans. More than half of plans had such limits before they were barred by the Affordable Care Act.

With all these changes in the Cassidy-Graham bill, the states might have considerable difficulty coming up with plans of their own by 2020, when the current system of covering their residents under Medicaid and the health law’s insurance market would end. “You’ve only got two years to figure all of this out,” said Robert Laszewski, an industry consultant in Alexandria, Va. “You need a comprehensive plan to phase Obamacare out to something that replaces it.”

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Bill and Melinda Gates Grade the World’s Health

At 61, he could speak with the avuncular magniloquence of a professor emeritus; instead, he layers on supporting data like a star pupil seeking an A-plus. He rebuts skeptical inquiries and insists on teaching from his own syllabus — and on flicking his own birch switch.

The report card will be issued annually, Mr. Gates said. He gave himself only a C+ on the first draft, promising sharper analytics in the future.

He isn’t actually handing out grades to the world’s health authorities — but is sending them home with a note for mom. Your kid has real potential but is becoming a discipline problem.

In some areas, like infant mortality, he considers the progress made “pretty miraculous.” In 1990, more than 11 million children died before their fifth birthday; now, fewer than 6 million do.

AIDS deaths have plummeted since 2004, and malaria deaths since 2005. Rates of childhood stunting, mothers dying in childbirth, and the miseries wrought by rare tropical diseases all have gone steadily down.

In poor countries, vaccine use is way up, though only about 75 percent of children get all the shots they need. More people have toilets these days.

Progress in other areas has been slower. Smoking is down, but tobacco companies are fighting back. Contraceptive availability is up, but almost half the women who want birth control still lack it.


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Access to basic health care is up, according to the new report. But the gap between rich and poor countries remains vast, because too much money goes to top hospitals instead of rural clinics.

One key finding: Most of the progress was not bought by donors, but came organically as hundreds of millions of people scrambled out of the most abject tiers of penury.

In 1990, 35 percent of the world lived below the international poverty line (currently $1.90 a day); now, only 9 percent do. Most of the great leap upward was in just two economic powerhouses: China and India.

The report’s scarier themes lie in its projections for the next 15 years.

Assuming economic progress continues, improvements in most health categories will churn dutifully on, or at worst plateau. But since the 2008 economic crisis, donors have been losing their will to give.

If that persists, the report says, chaos threatens. H.I.V. infections could double, returning to levels not seen since the 1990s. And malaria could climb back to the peak hit in 2005.

H.I.V. and malaria are particularly vulnerable to fluctuations in funding because they are concentrated in Africa, where economic progress has been slower than in Asia or Latin America and where birthrates remain high, producing a big pool of potential victims each year. Malaria has a history of rebounding as soon as pressure is eased; both the mosquitoes and the parasites quickly evolve resistance genes.

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The world’s birthrate is now peaking — probably forever — at about 134 million babies a year. “But it’s mind-blowing how much the shift in where kids are being born makes things hard for us,” Mr. Gates said.

Keeping infants alive gets tougher when they are born in lands with civil wars, dirt roads and healers who reject Western medicine.

Surprisingly, the new report was not a reaction to Mr. Trump’s threats to slash the foreign aid budget by 32 percent.


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According to Dr. Christopher J.L. Murray, director of the University of Washington’s Institute for Health Metrics and Evaluation, which gathered the data, it was initiated three years ago because Mr. Gates feared the world was losing its focus on health.

“Goalkeepers” refers to a metric that the world ignores but the Gateses do not: the targets periodically set by the United Nations, namely the 2000 Millennium Development Goals and the 2015 Sustainable Development Goals.

The first sharply emphasized poverty and health. But the latter comprise 169 targets for everything from reducing overfishing to bringing clean energy and decent jobs for all — they have an “I-want-a-pony-too” air about them.

The world prefers simple goals, like declaring war on smallpox. But war talk has stung Mr. Gates. Calls for an “AIDS-free generation” – all the rage six years ago — were “premature,” he said, and he was “embarrassed” by claims that malaria could be eliminated by 2015.

He prefers “Microsoft-type thinking” to set realistic goals. “People expect a certain degree of honesty,” he said. “They want to know, do Bill and Melinda track this stuff?”

Essentially, he is tracking the world’s pursuit of his own goals as he helps it reach them.

In early interviews, Mr. Gates refrained from criticizing Mr. Trump but gave the clear impression that he believed Congress would ignore most of the president’s proposed cuts. Congress appears to be doing just that.

To hear Mr. Gates tell it, even the staunchest backers of an America First ideology, which he called “selfish,” succumb to his fusillades of data.

Before Stephen K. Bannon, the president’s chief strategist, resigned, Mr. Gates met him in the White House. “He said, ‘Africa has always been a mess,’” Mr. Gates said. “I went through the numbers on its progress with him. He was impressed.”


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The new report’s weakness is that it cannot, for example, foretell how many more Ugandans would die of AIDS if American donations dropped 20 percent, in the way that the Congressional Budget Office can calculate how many Americans will lose insurance under a particular health care bill.

There are too many unpredictables in global health. A country would not just brutally take 20 percent of its H.I.V. patients off treatment, Mr. Gates noted. It might cut its military budget; it might try to stretch supplies of the drugs it got, triggering shortages.

Buried in the graphics-heavy report are some fun anecdotes that show how ingenuity can be just as important in the field as money.

In Ethiopia, for example, pregnant women were given a special stretcher to help them reach birth clinics; they had feared regular stretchers because villagers carried away on them usually died.

And an imam in Senegal described how he got other imams to accept birth control: by citing a saying from the Prophet Muhammad implying that children should be born about two years apart.

Correction: September 20, 2017

A picture caption on Tuesday with an article about a recent global health report by Bill and Melinda Gates misidentified the location of a speech the couple gave concerning the report’s findings. It was in Manhattan, not at the Seattle headquarters of the Gates Foundation.

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Now is the time to be bullish about digital health, according to this investor

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Proteus Digital Health

Earlier this month, my friend and industry colleague Rob Coppedge wrote a thoughtful post on the death of digital health, a space associated with too much hype and too little substance.

We agree that health care is really broken. It bankrupts our families, exhausts government discretionary spending, and leaves American industry at a global disadvantage.

However, here are a few divergent reasons for digital health’s (seeming) underperformance, which explains why early-stage investors aren’t getting the kind of returns they’re looking for:

  • Incrementalism: Hundreds of startups produce enterprise dashboards, online symptom checkers, and evidence-light apps. Many of these are flippant and those that are worthy often offer only incremental progress. By nature of their modest impact and the barriers to scale, many expectations are not being met.
  • Invisible unicorns: An aside, but there are many quiet successes in digital health that didn’t produce PR-driven Silicon Valley exits. How about CoverMyMeds? This team in Ohio used tech, network effects, and empathy to solve a real problem, reducing dispensing time for medications requiring payer prior authorization from an average of 14 days to 30 minutes. How? By embedding tech in the pharmacy, doctor’s office and payer — all while getting pharma to foot the bill. The result: a $1.3 billion exit to McKesson. Start-up land barely noticed.
  • Late bloomers: There may be many sleeping giants, as solving certain problems with scale sometimes takes longer in health. Just look at Pear Therapeutics, which this week received FDA clearance after a years-long process for its app to help treat substance abuse. Investors will need to think very hard to discern what can scale quickly versus what will need to bake slowly for longer.
  • Poor execution: The underlying issue with many failed or struggling digital health companies is poor execution. The excitement of the mission seems to slow down the need for timely product feedback. Most CEOs suffer from wishful thinking on the imminence of product-market fit, and defensible distribution has too often been an afterthought.
  • The “O” word: Oligopoly. As providers seek local market monopoly in the name of “scale and efficiency” or to pay for expensive medical record systems, costs soar and innovation falters. Likewise, the pharma supply chain makes money because of a lack of competition and transparent data, and payers are swimming in record profits. A special team of founders should not turn back form these challenges, but they should know the treacherous waters into which they sail.
  • Lack of ambition: Where is the Elon Musk of care provision? Why hasn’t anyone actually taken on the hospital? Hundreds of medication adherence apps entered the market in recent years, but only one start-up I can find is directly taking on the pharmacy benefits manager. In other verticals, we are seeing massive incumbents falling to data-driven, disruptive companies. We need some bigger bets in health care.

Think back to the wound-licking days of 2004…

I try to imagine how investors and founders felt in 2004. The bubble had burst, forcing the posers to depart. Meanwhile, a much smaller group of entrepreneurs kept building things, believing full well that the promise of the Internet from 1997 was not a false mirage but would take two or three rapid ecosystem iterations to actualize. And I believe some VC vintages in the following years ripened quite nicely.

This is where we are with digital health. We still need better real-time informatics that surround all that touch the patient. We still need to move data, remove silos, reinvent primary care and elder care, and bring genomics to the clinic at scale. We need to do this while taking on new models for risk and improving outcomes for populations.

And here’s where I have good news

First, so many of the best ideas from the past 10 years were just too early. But with dependencies removed, lessons learned and chess boards realigned, it’s time for the bigger second acts. Napster and MySpace and AOL paved the way for some much bigger platforms.

Secondly, the quality of some entrepreneurs starting ambitious companies in health and data is breathtaking. The advances in health research, design thinking and technology stack capabilities are helping a new class of health-technology founding teams. The talent and the tools are improving.

And then there’s the data. Deep computation is transforming how we live and work, and how we make human progress in areas like space, agriculture, manufacturing, transportation and retail. This deep compute has yet to truly make its mark on how we provide health care, and one or two large organizations dressing up buzzwords as marketing doesn’t count.

Make no mistake, the advances in computational power and data science are rapidly arriving in health provision. In the next ten years, we are going to create massively-valuable companies using deep compute to improve and QA decision-making, better enable empathetic health providers, and impact systems of care to create more personalized experiences for patients at every stage of their journey.

In fact, at some point it will no longer be called “digital health” because all aspects of health care provision will be built upon and infused with data and intelligence, from the optimized patient to a “learning” system of care.

There are blueprints to monetize

In addition to jumping through the aforementioned hurdles, we also need to address the assertion that there’s no clear path to make money in digital health.

There are many models, but here are three that are proven::

  1. 50X better: Yes, you can sell into the belly of the beast of our health system, but you do so with a product that solves a very specific problem and is 10 or even 50 times better than what was offered before. You still face speed bumps in validation, regulation and adoption, but you persevere.
  2. Full-stack: Rather than convince a huge number of stakeholders to adopt your technology, you identify the one that has to say “yes”, like a large self-insured employer. And you then go “full stack” as a tech and health business. Take Virta Health, a start-up that aims to reverse Type 2 diabetes. Rather than convincing thousands of providers and other groups to adopt new software and guidelines, Virta sells to the employer to become the “full stack” for the patient and builds a holistic provider-led clinic around this patient.
  3. Network effects: Creating a virtuous cycle where your product gets more valuable to users as more people use it is incontrovertibly powerful. And yet, there have been very few network effect platforms in U.S. health care. Network effects don’t solve every problem, but in solving problems like moving data, delivering new networks of caregiver support, and deep areas of research, we need to see more of these.

In sum, we need to be more ambitious, invest more heavily in our best entrepreneurs, and rebuild every use-case with our best data and computation. The first chapter is behind us, and now is the time to be bullish.

Scott Barclay is an entrepreneur and operator who has worked in health care for 20 years and is now a Partner at Data Collective, an early-stage investment fund focused on deep tech and compute.

New health-care plan stumbles under opposition from governors

Senate Republicans and the White House pressed ahead Tuesday with their suddenly resurgent effort to undo former president Barack Obama’s signature health-care law, even as their attempt was dealt a setback when a bipartisan group of governors and several influential interest groups came out against the proposal.

Powerful health-care groups continued to rail against the bill, including AARP and the American Hospital Association, both of which urged a no vote. But it was unclear whether the opposition would ultimately derail the attempt, as key Republican senators including Lisa Murkowski of Alaska said they had yet to make up their minds.

The measure marks the last gasp of Republican attempts to dramatically gut Obama’s Affordable Care Act, which has added millions of people to the ranks of the insured through a combination of federally subsidized marketplaces and state-level expansions of Medicaid, leading to record lows in the number of those without health insurance. The Graham-Cassidy bill — named for Sens. Lindsey O. Graham (S.C.) and Bill Cassidy (La.) — would convert funding for the ACA into block grants for the states and would cut Medicaid dramatically over time.

The bill — coming two months after a previous failed repeal effort in the Senate — is the subject of a last-ditch lobbying push by Senate Majority Leader Mitch McConnell (R-Ky.) and the Trump administration, led by Vice President Pence, ahead of a Sept. 30 deadline for Senate action.

In a letter to Senate leaders, the group of 10 governors argued against the Graham-Cassidy bill and wrote that they prefer the bipartisan push to stabilize the insurance marketplaces that Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) had been negotiating before talks stalled Tuesday evening.

The governors who signed the letter are particularly notable, since some are from states represented by Republican senators who are weighing whether to back the bill. Among the signers were Alaska Gov. Bill Walker (I), who holds some sway over Murkowski, a potentially decisive vote who opposed a previous Republican effort to repeal and replace the Affordable Care Act.

Nevertheless, Murkowski said Tuesday afternoon that she was still weighing her options and explained how her position on the bill might ultimately differ from her opposition to the repeal effort that failed dramatically in July.

“If it can be shown that Alaska is not going to be disadvantaged, you gain additional flexibility. Then I can go back to Alaskans, and I can say, ‘Okay, let’s walk through this together.’ That’s where it could be different,” she said.

But Murkowski, who has been in close contact with Walker, said she did not yet have the data to make such a determination. Alaska’s other Republican senator, Dan Sullivan, said he was still mulling whether to support the bill.

On the other side, a group of 15 Republican governors announced their support for the Senate bill Tuesday evening. The list includes Kentucky Gov. Matt Bevin (R), whose backing could help influence Sen. Rand Paul (R-Ky.), who has frequently criticized the legislation for failing to fully repeal the ACA.

On Tuesday, Pence traveled from New York, where he was attending the annual United Nations General Assembly session, to Washington with Graham in a sign of the White House’s support for the proposal.

“My message today is I want to make sure that members of the Senate know the president and our entire administration supports Graham-Cassidy,” Pence told reporters on the flight. “We think the American people need this.”

Graham added that President Trump called him at 10:30 p.m. Monday.

“He says, ‘If we can pull this off, it’ll be a real accomplishment for the country,’ ” he recalled.

Trump has played a limited role in building support among senators in recent days, but it is possible that his participation will increase as a potential vote nears. He has, however, been in touch with some governors, including a weekend call with Arizona Gov. Doug Ducey (R), according to aides.

Pence attended the weekly Senate Republican policy luncheon, where he said the current health-care system is collapsing and the bill fulfills key GOP promises to return control to states and rein in federal entitlement programs, according to several GOP senators.

Afterward, McConnell declined to ensure a vote on the bill but said his team is working to secure sufficient support.

“We’re in the process of discussing all of this. Everybody knows that the opportunity expires at the end of the month,” said McConnell, referring to the limited window Republicans have to take advantage of a procedural tactic to pass a broad health-care bill without any Democratic support.

Democrats say the ACA needs modest improvements by Congress but is working well overall, and they have railed against a process in which Republicans are pressing ahead with few hearings on legislation that would affect an industry that accounts for about a sixth of the U.S. economy.

The current bill would give states control over billions in federal health-care spending and enact deep cuts to Medicaid. The Medicaid cuts in particular are a major source of concern to the governors, both in terms of imposing a per capita limit on what states would receive and putting restrictions on how they could spend any federal aid on their expanded Medicaid populations.

Medicaid was expanded under the ACA to provide states with generous funding if they opted to cover adults earning up to 138 percent of the poverty level. Many Republican-led states decided against an expansion following a Supreme Court decision allowing them to opt out.

The fact that the bill also would restrict states’ abilities to tax health-care providers to fund their Medicaid programs posed a problem for several governors, as well.

In a sign of how alarmed state officials are about the prospect of funding cuts, Louisiana’s health secretary sent a letter to Cassidy on Monday saying that their state could see disproportionate cuts with significant impacts on people with preexisting or complex and costly conditions.

“This would be a detrimental step backwards for Louisiana,” wrote Rebekah Gee, who posted her letter on Twitter on Monday.

And although Walker has not played a visible role in the national health-care debate until now, certain aspects of the new bill pose an even bigger challenge for Alaska than previous proposals did. Health-care premiums are particularly expensive in the state, given its many remote areas. Premiums on the ACA market average roughly $1,000 a month for an individual, according to the most recent federal data.

Since federal tax credits over time would be equalized and based on the number of low-income people in a given state, that new calculation would eliminate the more generous subsidies Alaska enjoys.

Given the complex nature of the Graham-Cassidy proposal, it is difficult for state officials and health-care analysts to predict exactly how much money a given state would gain or lose if the legislation were enacted. But early estimates suggest that states with expanded Medicaid programs and active participation in the ACA markets could face major cuts.

An initial estimate for Colorado, according to state officials, suggests it could lose at least $700 million in annual federal funding by 2025. Since the state has roughly 450,000 people in its Medicaid expansion program and another 100,000 receiving premium tax credits on its health-care exchange, that could translate into hundreds of thousands of Coloradans losing coverage.

The governors who have been most outspoken in their criticism of the bill negotiated behind the scenes to bring as many state executives on board as possible, according to aides, tweaking the language of Tuesday’s letter over the past couple of days to get maximum support.

Others who signed the letter in opposition to Graham-Cassidy included John Kasich (R-Ohio) and Brian Sandoval (R-Nev.). Sandoval’s positioning puts him at odds with Sen. Dean Heller (R-Nev.), who has been touting the bill as another co-sponsor.

Pence said Trump told him to reach out to some Democrats, and he spoke to Sen. Joe Manchin III (D-W.Va.) over the weekend. But after reviewing the bill, Manchin said, he told Pence’s aides he could not support the legislation.

Senate Minority Leader Charles E. Schumer (D-N.Y.) said he’s confident no Democrat will vote for the legislation, because “it hurts people in every state.”

Democrats had been working furiously since Monday to advance talks between Alexander and Murray on a deal to immediately stabilize ACA insurance marketplaces with federal subsidies. The negotiations rapidly escalated after weeks of slow but consistent talks once it became clear that Senate GOP leaders were serious about holding a health-care vote before the end of the month, according to several Senate aides.

Alexander on Tuesday played down expectations of reaching an agreement this week, telling reporters the pair had reached an impasse.

“During the last month, we have worked hard and in good faith but have not found the necessary consensus among Republicans and Democrats to put a bill in the Senate leaders’ hands that could be enacted,” Alexander said in a statement.

Democrats denied that the talks had fallen apart, accusing Republicans of walking away despite making progress on areas of disagreement. Schumer spokesman Matt House said Democrats offered to accept a number of GOP requests, including waivers to give states more latitude in how they spend federal dollars and the creation of new low-cost plans under the ACA.

“This is not about substance,” House said in a statement. “The Republican leadership is so eager to pass Graham-Cassidy that they’re scuttling a balanced, bipartisan negotiation.”

Many Democrats, including Murray, said they hoped the talks could still be salvaged despite roadblocks from Republicans.

“I am disappointed that Republican leaders have decided to freeze this bipartisan approach,” Murray said in a statement. “But I am confident that we can reach a deal if we keep working together.”

Ed O’Keefe and Ashley Parker contributed to this report.

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Blue Cross official authors health IT article in New England Journal of Medicine

Advances in health care information technology and greater use of electronic health records and digital tools will drive better decision making and improve patients’ health, according to Blue Cross and Blue Shield of Louisiana’s chief medical officer.

Lead author Dr. Vindell Washington and co-authors Drs. David Blumenthal, Karen DeSalvo and Farzad Mostashari, all former national coordinators for health information technology for the U.S. Department of Health and Human Services, make this point and others in “The HITECH Era and the Path Forward.” The article was published in the Sept. 7 edition of the New England Journal of Medicine. 

The authors describe how the Health Information Technology for Economic and Clinical Health (HITECH) Act, passed in 2009, led a majority of health care providers to implement electronic health records and digital data sharing. Washington and his co-authors also offer suggestions to continue advancing health care IT in the digital age.

“We are in position for a great leap forward in health information technology,” Washington said. “A digital health system holds the promise of empowered patients and better-informed providers. Caregivers can work together to track patients’ health outcomes and know if they are making progress. And better information lets health insurance companies and government programs that are spending health care dollars on behalf of members and citizens know they are purchasing services of high value. The bedrock of all of this is a robust health care IT infrastructure.”

Washington cites the results from the Blue Cross’s Quality Blue Primary Care program, where primary care providers can access claims data and work together, as an example of successful data sharing. The program has helped patients better manage conditions like diabetes, high blood pressure and heart disease, and it is holding down costs.

Blue Cross and Blue Shield of Louisiana’s Quality Blue program will be featured at a Capitol…

For the complete New England Journal of Medicine article, click here.

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