with Paulina Firozi

THE PROGNOSIS

Rates rose all over the country on Affordable Care Act plans this year. But nowhere were individual exchange plans more expensive than in Charlottesville, Va.

Residents in the small university town who didn't qualify for government subsidies paid monthly premiums that were two to even three times higher than they had the year before. Insurers had pulled out of the area ahead of 2018, as was true in markets all over the country. After some cajoling from the state, Optima agreed to cover Charlottesville and its surrounding county, but with no competition priced its plans exorbitantly. 

Consumers were furious and formed a 700-person-strong alliance. Since fall 2017 they've been relentless in their pursuit of more affordable care, hiring lawyers and educating themselves on the intricacies of health law. 

Then Friday they received some welcome news: Anthem, which had left the market last year, was re-entering the individual market for 2019 at significantly lower rates than Optima. 

Even as President Trump claims the ACA is dead, it actually seems to be bouncing back after years of uncertainty -- and Charlottesville is one of the most dramatic examples of the law’s resilience.

“After a thoughtful review of the stability in the marketplace in Virginia, Anthem has revised its Individual health plan offerings for 2019 to include additional cities and counties," the company's spokesman, Scott Golden, said in an email. 

All over the country, insurers are lowering (or only slightly increasing rates) and re-entering markets.  "I think the good news is our market is rebounding back toward a more competitive atmosphere," said Doug Gray, the executive director of Virginia Association of Health Plans.

There are several factors that likely account for the stabilization of the ACA's individual market going into next year. Many insurance companies feared the unknown with a Trump White House. They expected the law to be repealed. Shortly before 2018 open enrollment, the administration eliminated cost-sharing reductions (CSRs), which were paid to insurers to help them absorb the costs of discounted deductibles and co-payments the companies are required by the ACA to offer some consumers. 

 "In the last year, there was a lot of uncertainty no one knew if the ACA was going to get repealed or not," Gray said. That was a serious question." 

"The other serious question was whether the Trump administration would follow through on CSRs," he added. "When the administration says to you, 'we’re going to change the contract and ensure you have large losses' it’s not surprising people will look and say, 'I can’t trust what will happen next'."

In many cases, insurers overestimated the affect of threats of the law's demise and the loss CSR payments would have on their bottom line. And even with this year's policy changes like the repeal of the individual mandate penalty and the expansion of low-cost, less-coverage short term and health association plans, insurers are projecting the market to be profitable and thus are able to keep their rates level or a bit higher.  (Though many health policy experts say if not for the changes intended to weaken the ACA, premiums across the board would be much lower this year.)

"I think at least one factor is (prices) were so dramatic for 2018 many insurers are seeing that they overshot the mark and therefore they can’t justify huge premium increases for 2019," said Timothy Jost, an emeritus professor of law at Washington and Lee University School of Law. "It’s a very dynamic situation. I think the insurers are on a wild ride here and they’re just hanging on, but it does look like the market is stabilizing a bit."

Virginia is also a special case, Jost told me, because the state agreed to expand Medicaid beginning January 1, 2019, meaning more low-income people will be covered through the  government program. In other words, the insurance companies will no longer be covering anyone earning below 138 percent of the poverty line, which should, Jost reasons, reduce costs because lower income Americans are statistically less healthy. 

One reason it's a big deal for Charlottesville -- and the dozen or more markets around the country where insurers are entering or coming back to states they'd fled -- is because competition drives down prices. Although competition is not technically supposed to be a factor in setting rates, a recent study published by Health Affairs found that "in 2018, Marketplace premiums were 50 percent ($180) higher, on average, in rating areas with monopolist insurers, compared to those with more than two insurers."

Cynthia Cox, director of health reform and private insurance at the Kaiser Family Foundation, told me that she's tracked new entrants in a dozen states.

"The ACA is much more stable than people would have given it credit for," she said.

While the stabilization of the ACA is certainly the reason why Anthem felt it could be profitable in the Charlottesville market, it's important to note the efforts of the consumers there who challenged the legality of Optima's extremely expensive rates. They even got an official at the Centers of Medicare and Medicaid Services to weigh in by email on July 13, telling them it would not  be "appropriate" for a carrier to set its rates based on "competitive pricing or desired profit margins," as they claim Optima did. 

The Commissioner of Insurance in Virginia, Scott White, did not see it that way and defended its approval of Optima's rates in an April letter.

But Gray said the consumers' activism may have played a role in Anthem's decision to get back into the market. "It is always nice to have people clamoring for your product," he told me. 

"I hope it made an impact," Jost said of the consumers. "They’re not just people complaining or people who have come up with some human-interest stories. They seem to understand insurance regulation and what the federal regulations are, frankly, I think they understand the regulations better than Optima and possibly better than the state regulators."

Ian Dixon, one of the Charlottesville residents who faced a $3,000-a-month premium for his family of four last year, helped lead the effort to get Optima's rates reduced. Even with Anthem back in, Dixon said the group might still continue arguing that Optima's rates were set unfairly. 

"It’s taken a ridiculous amount of hours, it’s hard work to do it," he told me. "We’ve shone a light on something that’s happened in the dark typically. When we really started digging in … we’ve been driven by knowing that we’re right and the sense of injustice about it. "

AHH, OOF and OUCH

AHH: The U.S. ambassador to Ecuador has denied to the New York Times the report from the newspaper about Trump administration efforts to block a breast feeding resolution at the World Health Assembly, reporters Andrew Jacobs and Pam Belluck write. Todd C. Chapman told the Times that its report that he threatened officials from Ecuador with trade sanctions if they were to support a resolution to promote breast feeding were “patently false and inaccurate.”

While a similar measure to promote breast feeding was eventually introduced by Russia, Ecuador dropped its resolution that had intended to urge the end of “inappropriate marketing of foods for infants and young children,” that could take away from breast feeding.

“In his recent interview with the Times, Mr. Chapman said he was asked by the Department of Health and Human Services, the agency leading the negotiations at the World Health Assembly in Geneva, to meet with officials in Ecuador to raise concerns that H.H.S. had about the timing and substance of the resolution that Ecuador wanted to introduce,” Andrew and Pam write. “He said that during his meetings, with the Ecuadorean minister of health and the acting minister of foreign affairs, there was no mention of trade sanctions or military assistance… Mr. Chapman said that in his discussions with the ministers, he read a diplomatic cable that H.H.S. sent him and conveyed the department’s concerns. Soon after, Ecuadorean delegates met with American delegates in Geneva and agreed to drop the resolution.”

OOF: Medicare’s Part D, the prescription drug program, is praised for keeping plan premiums low. But it has also dipped into taxpayer pockets, costing them $46 billion in 2007 and spiking 72 percent to $79 billion in 2016, the New York Times’s Austin Frakt reports.

“It’s a surprising statistic for a program that is often praised for establishing a competitive insurance market that keeps costs low, and that is singled out as an example of the good that can come from strong competition in a private market,” Austin reports. “Much of this increase is a result of growing enrollment — it has doubled in the past decade to 43 million — and higher drug prices. But there is also a subtle way in which the program’s structure promotes cost growth.”

Premiums have remained low in part because reinsurance spending had skyrocketed, Austin explains. The government reinsurance program kicks in when a Medicare Part D enrollee’s drug costs surpass a “certain catastrophic threshold – set at $5,000 in out-of-pocket spending in 2018,” but below that threshold, plans pay a majority of the drug costs. Such a program has incentivized the private insurance plans that operate under Medicare Part D to “find ways to push enrollees into the catastrophic range.”

Reinsurance spending has also increased under the ACA, which requires drugmakers to pay some of the cost of the drug benefit, contributing to the account of out-of-pocket costs, which are pushed into the “catastrophic” threshold, thus triggering reinsurance. “That means enrollees don’t have to spend as much as they otherwise would to trigger the reinsurance program,” Austin adds. “Although this is of great benefit to enrollees, it also pushes up taxpayer liability for the program.”

OUCH:  The stock for agribusiness giant Bayer dropped more than 10 percent on Monday following a California jury’s decision to award a man $289 million who said a popular weedkiller Roundup gave him cancer.

“The stock drop sent a cautionary signal to the company that acquired Monsanto, the maker of the weedkiller, in June for $63 billion,” our Post colleague Rachel Siegel reports. “The merger created the world’s largest seed and agrochemical company, marrying Monsanto’s dominance in genetically modified crops with Bayer’s pesticide business. Bayer’s portfolio also includes pharmaceuticals with such household brands as Aleve to Alka-Seltzer.”

Anthony Johndrow, a corporate reputation adviser warns that Monsanto, a company that is hardly new to lawsuits, could weaken Bayer’s reputation as well as negatively affect the sale of its other products.

HEALTH ON THE HILL

— Health insurance groups and drug companies have joined together to launch the Partnership for America’s Health Care Future, a new group set to take on the issue of single-payer health care legislation should it gain legs, The Hill’s Peter Sullivan reports.

The group is mainly concerned about the possibility that Democratic gains in Congress will push forward the issue, which could become a litmus test in 2020, Peter writes. “When Democrats controlled the White House and Congress at the outset of the Obama presidency, they stopped short of a single-payer system in creating ObamaCare, which the Trump administration and GOP-controlled Congress have worked to dismantle,” he adds. “But support for a single-payer system has since gained steam, and a wide range of potential 2020 Democratic presidential candidates have backed Sen. Bernie Sanders’s (I-Vt.)’“Medicare for all’ bill, including Sens. Kamala Harris (Calif.), Cory Booker (N.J.) and Elizabeth Warren (Mass.).

America’s Health Insurance Plans (AHIP), the Pharmaceutical Research and Manufacturers of America (PhRMA), the American Medical Association and the Federation of American Hospitals are members of the Partnership for America’s Health Care Future, which formed in June.

— The Republican failure to repeal the ACA  could be coming back to bite Republicans as Democrat look to take over control of Congress in November. One such example is the special election in a central Ohio district, which is still too close to call nearly a week after voters hit the polls.

“Buoyed by new polls, Democrats are hanging the Republican effort to repeal the Affordable Care Act around the necks of GOP Congressional candidates during this fall’s midterm election campaigns as they seek to takeover control of Congress,” Forbes’s Bruce Japsen writes, adding “even Republicans admit that the unpopularity of Donald Trump and the GOP-led Congress' effort to take away healthcare spells bad electoral news.”

“Republicans running for re-election in competitive districts have one thing in common: they overwhelmingly voted to take away Americans’ health care — and they’ll have to answer for this on the campaign trail,” Amanda Harrington of the group Protect Our Care told Bruce.

— Meanwhile,  HuffPost’s Jonathan Cahn reports the future of the ACA depends not only on who retains or gains control of congressional majorities in Washington, but who is in the state capitals as well, especially in the role of governors, insurance commissioners and state legislatures.

“The current state of play for health care is a reminder of one way that the GOP’s war on ‘Obamacare’ has made headway ― by giving states more control so that access to health care in places like Georgia looks more and more different than it does in California,” Jonathan reports. “These officials have always had a lot to say about the ACA’s implementation, although they rarely get the attention they deserve. Now they have even more influence, thanks to the ways that President Donald Trump and his allies have battered the law over the last 18 months."

OPIOID OPTICS

— An informative but perhaps grim practice of informing doctors when their patients have died as a result of prescribed opioids could help decrease the number of prescribed painkillers and prevent future overdose deaths, new research published last week in the journal Science found. Researchers from the University of Southern California worked with the San Diego County’s chief deputy medical examiner on the study, which sent hundreds of form letters to doctors who had prescribed opioids in the last year who had later died, our Post colleague Carolyn Johnson reports.

“This is a courtesy communication to inform you that your patient (Name, Date of Birth) died on (date). Prescription drug overdose was either the primary cause of death or contributed to the death,” the letters read. “… We hope that you will take this as an opportunity to join us in preventing future deaths from drug overdose.”

“The letters were successful, although the effects were modest,” Carolyn writes. “Doctors who were informed of their patients' deaths were 7 percent less likely to start new patients on opioids and issued fewer high-dose prescriptions over the next three months, compared with those who did not receive a letter. In total, there was a 9.7 percent reduction in the total amount of opioids they prescribed.”

“Psychologists talk about a concept called the ‘availability heuristic’ — the idea that people making decisions draw on their most recent experiences,” Carolyn adds. “If a doctor learns that a few months after she prescribed 30 pills of OxyContin, a patient died of an overdose, the information may make her reconsider whether the prescription is truly necessary next time.”

MEDICAL MISSIVES

— A new study found that while 10 percent of patients in the United States say they are allergic to penicillin, about 90 percent of them can actually tolerate the drug. “That means millions of people take alternative antibiotics, which are more expensive and can put their health and potentially the health of others at risk,” our Post colleague Kate Furby reports. “The solution is a simple allergy test.”

The study is based on six years of medical records for patients in the United Kingdom. The research found “those with a penicillin allergy had an almost 70 percent greater chance of acquiring a methicillin-resistant Staphylococcus aureus (MRSA) infection and a 26 percent increased risk of Clostridium difficile-related colitis (C. diff.),” Kate reports.

Why does it matter? Those with penicillin allergies are often instead given broad-spectrum antibiotics, which can end up killing good bacteria as it kills the bad, increasing the risk of infection.

Kate notes that diagnosing an allergy to penicillin is challenging, that some symptoms, such as rashes in children, can be mistaken for penicillin allergies and that even when children are diagnosed with the allergy correctly, they may grow out of it.

INDUSTRY RX

Six years and a billion dollars after International Business Machines Corp. suggested that Watson, its artificial-intelligence system could represent a breakthrough in medical technology, helping physicians improve patient outcome and even cure cancer, “the diagnosis for Watson is looking gloomy,” the Wall Street Journal’s Daniela Hernandez and Ted Greenwald report.

Here’s the takeaway: “No published research shows Watson improving patient outcomes,” Daniela and Ted write.

“More than a dozen IBM partners and clients have halted or shrunk Watson’s oncology-related projects,” they write, noting the system’s cancer applications haven’t had much impact on patients. “In many cases, the tools didn’t add much value. In some cases, Watson wasn’t accurate. Watson can be tripped up by a lack of data in rare or recurring cancers, and treatments are evolving faster than Watson’s human trainers can update the system. Dr. Chase of Columbia said he withdrew as an adviser after he grew disappointed in IBM’s direction for marketing the technology."

Meanwhile, IBM says Watson has some benefits, like “helping doctors keep up with the medical knowledge.” “This is making a difference,” IBM senior vice president John Kelly told the Journal. “The data says and is validating that we’re on the right track.”

— Maryland-based Emergent BioSolutions said last week it will sent $270 million to acquire a vaccine manufacturer that sells FDA-approved vaccines that protect against cholera and typhoid. Emergent BioSolutions already provides infectious disease vaccines for the U.S. government, “controls the market for anthrax vaccines,” and in recent years has seemingly “put its stamp on nearly every major infectious disease scare,” our Post colleague Aaron Gregg reports.

“The vaccines Emergent is acquiring from PaxVax are meant to address much older public health problems. Outbreaks of cholera, a deadly diarrheal disease spread through contaminated food, has threatened humanity for centuries and is still prevalent in parts of Africa and Asia,” Aaron reports. “For Emergent, the goal is to build a stockpile of vaccines that might head off a global pandemic — and earn a healthy profit along the way.”

AGENCY ALERT

— The Trump administration late last week announced a proposal seeking to undermine the ACA by getting rid of Accountable Care Organizations, which are teams of doctors, hospitals, or other health care providers.

Under the health care law, the provider teams can collect bonuses for providing better care at a lower cost, which can be even greater if they accept risk for overspending, our Post colleague Amy Goldstein reports. “More than 80 percent of 561 teams in this Medicare Savings Program are using the bonus-only version, with more than 300,000 clinicians and 10 million patients taking part,” she adds. “Now, federal health officials want to limit such teams, saying federal data show that this version has ended up costing Medicare extra money.”

“We believe the time has come to put accountability into the Accountable Care Organizations,” CMS Administrator Seema Verma told reporters on Thursday, criticizing the “shocking reality” that four-fifths of ACOs are not accepting financial risk under the current program.

— And here are a few more good reads from The Post and beyond: 

DAYBOOK

Coming Up

  • The House Financial Services Committee holds a hearing on “The Role of Federal Housing and Community Development Programs to Support Opioid and Substance Use Disorder Treatment and Recovery” on Thursday.
  • The Senate Homeland Security and Government Affairs Permanent Subcommittee on Investigations holds a hearing on “Oversight of Efforts to Protect Unaccompanied Alien Children from Human Trafficking and Abuse” on Thursday.
  • The Senate Homeland Security and Government Affairs Committee holds a hearing to examine “Centers for Medicare and Medicaid Services efforts to fight Medicaid fraud and overpayments” on Aug. 21.
SUGAR RUSH

Here's what's on Omarosa's secret White House recordings: 

President Trump calls fact checks "bad people":