New HHS Secretary Tom Price faces a crushing inbox

Newly confirmed HHS Secretary Tom Price likely will spend his first few days focusing on efforts to stabilize the individual health insurance market as Republicans work to repeal and replace the Affordable Care Act.

Following the pattern of strictly party-line votes on two previous nominees—Attorney General-designate Sen. Jeff Sessions and Betsy DeVos for education secretary—the former congressman from Georgia was approved on a 52-47 vote.

“(Price) can now get to work and focus on the task of replacing the failed Obamacare with sustainable, free-market principles,” Sen. Johnny Isakson (R-Ga.) said in a statement.

Two days earlier, the Senate had voted to move forward Price's nomination on a 51-48 party line cloture vote.

Senate Democrats boycotted the nomination, prompting Republicans to suspend the rules and vote on his nomination with no Democrats present.

Patient advocacy groups have been concerned about the former legislator's efforts to repeal the ACA.

“With this vote, Senate Republicans have placed the fate of the nation's healthcare system in the hands of a man whose stated goal is to dismantle its very pillars and leave millions of people to the mercies of the insurance industry,” Ron Pollack, executive director of Families USA, said in a statement.

Price has to figure out how to keep insurers in the market for 2018 to avoid a meltdown that could leave 20 million people without coverage. Insurance industry leaders say they need greater certainty about market rules before they decide this spring whether to offer plans and how to price them.

Meanwhile, President Donald Trump is counting on the staunchly conservative former orthopedic surgeon to lead the effort to draft an ACA replacement plan, while also taking steps to dismantle the law through administrative measures.

HHS already has a draft rule in the works that reportedly responds to insurance industry requests for changes such as greater leeway to charge older consumers higher premiums. Price may be torn between a Trump administration executive order calling for rolling back ACA enforcement and pressure from insurers to preserve rules such as the individual mandate that keeps younger and healthier people in the market.

“Decisive action from HHS may be the only thing that can prevent a death spiral in the individual market, and even then, uncertainty about repeal, replace or repair may be too much for HHS to overcome,” said Morgan Tilleman, an attorney with Foley & Lardner in its heath insurance practice.

Price will look for Obama administration regulations that healthcare industry groups have deemed too burdensome and seek to alter or eliminate those, said Dan Mendelson, president of consultancy Avalere.

Insurers and hospitals may welcome that. But consumer advocacy groups may not.

There also are questions about whether and how Price will promote Medicare's continued shift from fee-for-service to value-based payment models. He has sharply criticized the CMS Innovation Center, particularly its mandatory bundled-payment programs for joint replacements and cardiac care.

At his confirmation hearing before the Senate Finance Committee last month, Price said the Innovation Center had “gotten off track” and that its mandatory programs were dictating to physicians how they must practice medicine.

Price's 2015 legislation to repeal the ACA would have granted physician groups considerable control in key areas of healthcare quality.

Those provisions raised conflict-of-interest concerns among some critics. Price's ties to the healthcare industry overshadowed his confirmation process as did calls from Democrats for investigations into his stock deals. Several reports alleged Price had personally benefited from legislation he introduced that ended up influencing the price of healthcare stock he had purchased.

Sen. Chuck Schumer (D-N.Y.), the Senate minority leader, called Price's nomination akin to “asking the fox to guard the hen house.”

Through it all, many physicians' groups stood by Price.

“Throughout his tenure in Congress, Dr. Price has been a champion for combating the rise in chronic disease, emphasizing wellness and prevention, expanding the use of health data to improve care, and strengthening the Medicare program for future generations of beneficiaries,” said Mary Grealy, president of the Healthcare Leadership Council. “We look forward to working with him on these priorities in his leadership at HHS.”

Under Price, HHS will begin reviewing Medicaid waiver requests from Arizona, Indiana, Texas and other GOP-led states seeking approval for conservative policies that were rejected by the Obama administration, Mendelson said. These states want to impose work-search requirements as a condition for Medicaid eligibility, lock people out of coverage for nonpayment of premiums, and set time limits on how long people can receive benefits.

It's expected that Price will look favorably upon such requests, which are strongly opposed by patient advocacy groups who believe they will affect access to care for some vulnerable communities.

“He has consistently sought to undermine women's health and promote policies that make it harder for those most in need to get quality, affordable health coverage and care,” said Debra Ness, president of the National Partnership for Women & Families. “This appointment could have tragic consequences for the heath and economic security of millions of people.”

Price is also expected to spearhead the conservative drive in Congress to restructure Medicaid and Medicare, as he previously tried to do as a legislator. Republican lawmakers in Texas, Wisconsin and Price's home state of Georgia want to work with congressional Republicans on proposals to convert Medicaid into a program of federal block grants or per capita grants, giving states much greater flexibility in how they use federal Medicaid dollars. At the same time, however, states likely would receive significantly less money over time.

Price will have a key partner in considering Medicaid waivers if and when the Senate confirms Trump's nominee for CMS administrator, Seema Verma. She has helped such states as Indiana develop conservative Medicaid expansion models. Senate Finance Committee Orrin Hatch has scheduled an initial confirmation hearing for Feb. 16.

Verma worked with Vice President Mike Pence on Indiana's conservative Medicaid expansion when he was governor there and consulted on similar initiatives in Iowa, Kentucky, Maine, Ohio and Tennessee.

In addition, Price may look for ways to expand the role of private health plans in Medicare, which would be consistent with his support for converting Medicare into a defined-contribution, “premium support” program. He likely will work closely with House Speaker Paul Ryan (R-Wis.) on a proposal to restructure Medicare along those lines and increase the eligibility age to 67, though Senate Republicans remain leery about making big changes in the politically popular senior health program.

Price argues that Medicare restructuring is necessary to protect the financial future of the program. During his confirmation hearing, Price said the Medicare trustees estimate that the Part A hospital trust fund will become insolvent by 2028 unless changes are made.

The NAACP, the nation's oldest civil rights organization, had urged the Senate not to confirm Price because of his Medicare views.

“Congressman Price is ... a proponent of radical and dangerous proposals to cut billions from Medicare, converting it to a voucher program which would lose value over time and will lead to less parity in coverage and increase the financial burden of healthcare for low-income groups,” the NAACP said in a letter.

Former congressional colleagues who placed Price in his new role, however, disagree.

“He will play a leading role in our efforts to repeal the failed healthcare law and provide the American people with more affordable, patient-centered care,” Rep. Virginia Foxx (R-N.C.), chairwoman of the House Committee on Education and the Workforce, said in a statement.