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POLITICO New York Health Care: Managed care concerns; State announces three insurers to take HRI customers

Dear readers: POLITICO New York Pro subscribers receive this email at 5:30 a.m. each weekday. If you'd like to receive it at that time, along with a customized real-time news feed of New York health care policy news throughout the day, please contact us at and we'll set you up for trial access.

written by Dan Goldberg

CONCERNS OVER MANAGED CARE FOR CHILDREN — The state's effort to move children with behavioral health problems into managed care models has been lauded for the most part, but advocates are concerned there won't be enough funding to help providers work through the many technical and operational problems they expect to face. Last week, the United Hospital Fund outlined four specific challenges facing state health officials, who already have agreed to several delays, including, most recently, the implementation of children's health homes. The delay, according to state health officials, was done to give providers more time but what they really need, according to advocates, is more money. Read my story here:

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THREE INSURERS AGREE TO ENROLL HR CUSTOMERS — Three insurers — Excellus BlueCross BlueShield, MVP Health Care and Fidelis Care — have agreed to automatically enroll customers from Health Republic Insurance of New York, the insolvent co-op that was ordered to wind down on Nov. 30, leaving its 200,000 beneficiaries without health insurance for December. Those living near Rochester — in Livingston, Monroe, Ontario, Seneca, Wayne and Yates counties — will be enrolled in Excellus. MVP will take Ulster County. Everyone else will be automatically enrolled with Fidelis. The move is a win for health insurers, provided these automatically enrolled customers pay their December premiums. Had the state not moved to enroll them, insurers may have faced a situation where only the sickest, most expensive customers enrolled themselves for the last month of the year. That scenario, known as adverse selection, could have posed a financial disaster for certain plans. Read my story here:

...This automatic enrollment applies only to December. Everyone must re-enroll for January, which presents another hurdle for the state and another opportunity for adverse selection.

NOW WE KNOW — A study in the journal Applied Economic Letters explains what women want … in sperm donors. This is useful information because, apparently, there is so much demand for sperm that an online market has formed, which operates separate from fertility clinics. The study found women, seeking sperm online, were far less likely to choose sperm from fretful or socially awkward men. But here is the rub: Women also stayed away from lively, extroverted men. What women want are men who intellectual, shy, calm and methodical.

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FACE OFF — NYU Langone completed the world’s most extensive face transplant, according to ABC News. The pictures here are a bit graphic but the surgery, and how it was performed, is fascinating. Doctors told him he had only a 50-50 shot of surviving what would be a 26-hour surgery.

UN-HAPPY MEAL — An employee at a McDonald's in Waterloo, in upstate Seneca County, worked at the restaurant while infected with hepatitis A, a viral liver infection transmitted through food and water or direct contact. The McDonald's is at 2500 Mound Road, about four miles off New York State Thruway Exit 41. Anyone who ate at that location on Oct. 31 or on Nov. 2, 3, 5, 6 or 8 should contact a physician and receive a preventive vaccination, the state health department said. The vaccine is only effective within two weeks of exposure to the virus. The Seneca County Health Department has set up clinics to provide hepatitis A vaccines or immune globulin for people who may have been exposed in order to prevent infection. Register here:

FINANCES — Memorial Sloan Kettering Cancer Center reported operating income of $143.1 million for the nine months ending Sept. 30, $20 million less than what it reported for the same period in 2014. Operating revenues increased by 9.4 percent, or $232.6 million, according to the hospital's most recent financial report. Operating expenses increased by 11 percent, or $252.4 million, from 2014. The cancer center reported that purchased supplies were up 12.9 percent year-over-year, close to $100 million. That, in large part, is because of pharmaceutical costs, which increased $54 million or 18.6 percent. Read the full report here:

MORE FINANCES — Maimonides Medical Center reported an operating revenue loss of $3.86 million through the first nine months of the year, more than $5 million off what was budgeted, according to its most recent financial report. Much of that can be attributed to a shortfall in out-patient revenue. Maimonides reported $229 million in out-patient revenue, about $8.8 million less than budgeted. The M2 Medical Community Practice P.C., formed in 2013, reported an additional $3.9 million operating loss. Maimonides reported about $8.8 million in other revenue gains so its total loss after accounting for capital grants, investments and interest rate changes was approximately $1 million for the first nine months of the year. In August, the Maimonides board voted to approve an affiliation agreement with North Shore-LIJ. Read the full report here:

ANTI-SMOKING — Gina Bellafante, in The New York Times, says there are “compelling reasons to limit smoking in multiple-unit dwellings across the city. … The health department currently works to reduce smoking in public housing by actively helping people quit. The city could also try to resurrect the initiative to restrict smoking in all apartment buildings, on the grounds that no family should ever lose all of its belongings because the drunken bond trader in 6G fell asleep on his MacBook Air with a lit cigarette.”

EVICTION FIGHT — The Real Deal reports that NYU has obtained a temporary injunction against Olmstead Properties. “NYU claims Olmstead served it with a five-day lease termination notice on Wednesday to vacate the building, at 180 Varick Street, where the university leases space on the fifth through eighth floors as a research facility for its NYU Langone Medical Center. While NYU has a 15-year lease at the property that it signed in 2010, Olmstead is allegedly claiming the school breached its lease by failing to address several violations at the building, according to the lawsuit filed in New York State Supreme Court.”

GRANT LAND Six New York City-based health centers will receive $389,000 in awards for outreach and enrollment assistance through the state’s health insurance marketplace, the Health Resources and Services Administration announced. Apicha Community Health Center, Community Health Initiatives Inc., Community Health Project Inc., New York City Health and Hospitals Corporation, Tremont Commonwealth Council VIP and Union Community Health Center, Inc. will receive awards for helping raise awareness of insurance options and aiding in enrolling uninsured individuals. Read the full list of award winners here:

ACROSS THE RIVER — New Jersey’s Economic Development Authority approved $16.9 million in tax credits for the construction of the new Seton Hall-Hackensack School of Medicine in Clifton and Nutley. The private medical school, a partnership between Seton Hall University and Hackensack University Health Network announced in June, will be located on the former corporate campus of pharmaceutical giant Hoffmann-La Roche. In its application to the state, the school wrote that it “envisions a vibrant University campus with the presence of over 500 medical students and faculty in addition to approximately 1,500 faculty and students enrolled in the College of Nursing and School of Health and Medical Sciences.”

PHARMA REPORT: Reuters has an exclusive which found that over the past few days, the largest U.S. managers of private prescription drug benefits have cut off at least eight pharmacies that work closely with drugmakers, intensifying scrutiny of a system that helps inflate drug prices. “The terminations come from payers who together manage drug benefits for more than 100 million Americans, and they follow disclosures by Valeant Pharmaceuticals International Inc in late October that one pharmacy accounted for about 7 percent of its sales.”


-2016 BIG CASE — In June, 2016, with all eyes focused on the November presidential election, Supreme Court Justice Anthony Kennedy will likely be the swing vote for one of the most important abortion cases in more than 20 years. The court agreed on Friday to hear Whole Women’s Health v. Cole, a case that centers on whether Texas laws, requiring abortion clinics be regulated as ambulatory surgery centers, and its doctors have admitting privileges at a hospital, present an undue burden on women seeking abortion. Texas says it just wants to ensure women are safe. Pro-choice advocates say the practical effect of the law has been the closing of three-quarters of the state’s clinics, leaving millions of women with fewer options. It was Kennedy who helped write the controlling opinion in Planned Parenthood v. Casey, and The New York Times’ Adam Liptak says his vote will almost certainly be crucial. The future of abortion rights in the United States probably rests almost entirely in his hands.”

-CRISPR — The New Yorker explores a new genetic technology with amazing — think science fiction — potential. “Because it makes manipulating genes so much easier, CRISPR offers researchers the ability to rapidly accelerate studies of many types of illness, including cancers, autism, and AIDS. It will also make it possible to alter the genes of plants so that they can resist various diseases (without introducing the DNA of a foreign organism, which is how G.M.O.s are made). With CRISPR, almost anything could become possible: You want a unicorn? Just tweak the horse genome. How about a truly blue rose? The gene for the blue pigment does not exist naturally in roses. With CRISPR, it should be a trivial matter simply to edit that gene in.”

-SURVIVOR Just more than half of the original 23 nonprofit startup insurance companies that were established with $2.4 billion in Obamacare loans have collapsed this year amid mounting losses, POLITICO’s Paul Demko reports. “But the hope is that the dead wood has now been cleared away by the Obama administration and state regulators. The 11 remaining plans are pushing to become financially viable over the long term. There is no easy explanation for why some co-ops failed and others have survived — so far. All of the startups faced formidable hurdles from the outset, including a prohibition on spending federal dollars on marketing and limitations on where and how they could compete for customers. But many of the defunct co-ops shared a common trait: They were very successful in attracting customers in the first two years of business. Nonprofit startups in New York, South Carolina, Colorado, Nevada and Kentucky were among the market leaders in their states selling Obamacare exchange plans. When those customers proved sicker and more expensive than anticipated, the plans started bleeding red ink. In addition, many of the failed plans counted on buttressing their bottom lines with significant risk corridors payments. Health Republic Insurance of New York, most notably, was expecting to receive nearly $150 million. When CMS announced last month that insurers would only initially receive 12.6 cents on the dollar, it blew a gaping hole in the balance sheets of the fledgling plans.”

TODAY'S TIP — Comes from the state’s department of health, which reminds us to “break out the layers to help avoid hypothermia.”


-TESTING — Weill Cornell Medicine is unveiling a test that can scan thousands of genes to reveal which therapies might work best for cancer patients. The test, EXaCT-1, identifies alterations within tumors, according to a press release from WCM. "Since President Obama announced his precision medicine initiative in January, there has been a huge push from institutions across the country to establish themselves as leaders in this field," Dr. Mark Rubin, director of the Englander Institute and the Homer T. Hirst III Professor of Oncology in Pathology at Weill Cornell Medicine, said in the release. What makes this test different is that it looks at more than 21,000 genes in cells both healthy and malignant. What physicians hope is that they may find uncommon mutations that allow them to treat patients in new ways. For example, a patient with bladder cancer found to share a mutation associated with breast cancer might benefit from a drug typically prescribed to breast cancer patients.

-ELDER ABUSE — Approximately 10 percent of people over the age of 60 are likely to experience some kind of abuse, likely financial exploitation, according to a study from Weill Cornell Medicine, which appeared in The New England Journal of Medicine. Those at greatest risk are women and those with physical or cognitive impairments.

MISSED A ROUNDUP? Get caught up here: 11/13, 11/12, 11/11, 11/10, 11/9

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