State Dept. Won't Identify "Specific Scenarios of Noncompliance" in Iran Deal

    Yesterday, the Obama administration announced an agreement regarding Iran's nuclear program had been reached.  But a statement about the enforcement of the deal made by a senior administration official during a background briefing on Sunday, however, is likely to further worry critics of the deal.  The official declined to cite a single example of an "individual instance of noncompliance" that would trigger the reversal of the sanctions relief put into effect by the deal:

QUESTION: ... If Iran violates any part of this deal, does the deal come to an end immediately? I know you said that there would be more sanctions. But what specifically does it mean for the deal?...
SENIOR ADMINISTRATION OFFICIAL ONE: ... I think the bottom line is this agreement is based on the two sides taking steps that fulfill their commitment, and the implementation plan provides for a roadmap for the timing and sequencing of those steps. I couldn’t speculate onto specific scenarios of noncompliance. What I would say, though, is that if Iran does not comply with the agreement, then the relief that they’ve accessed as part of the agreement is reversed. And we have said that we would move to impose additional sanctions, including working with Congress to do so.
So the short answer to your question is yes, if we were to assess that Iran had not complied, then they would not be able to access the relief that they’re slated to get through this agreement, and we would move to additional sanctions. Now, the specifics of those scenarios remain hypothetical, so at this point, I wouldn’t want to speculate as to what an individual instance of noncompliance is.

    The official went on to say, "Our hope and expectation is that Iran will comply."


Note: A version of this article first appeared at The Weekly Standard.

Paid Obamacare Enrollment Data Likely Not Released Until February

    The Obama administration has come under fire for weeks now for selectively releasing "enrollment" data for Healthcare.gov and the state exchanges.  The latest figure of 2.1 million was met with skepticism by many observers, even some who are sympathetic to the administration.  Based on previously published guidance for insurers by the Centers for Medicare and Medicaid Services (CMS), however, it is likely any data the administration has on paid enrollments is substantially incomplete.
    On October 3, two days after the launch of Healthcare.gov, CMS published a document called "Federally Facilitated Marketplace Enrollment Operational Policy & Guidance."  The manual begins with a preamble that reads in part:

This draft manual will go into effect with minimal changes as of October 1, 2013. All enrollments made on or after October 1, 2013, must be processed in accordance with these requirements. It is CMS’ intention that this will be a living document, updated regularly, and supported by clarifying bulletins in the interim between updates.

    Although CMS says the manual will be "updated regularly", it appears from the Regulations and Guidance page of CMS's website that the October 3 draft of the manual is the most recent version.  That same page does, however, include various updates relating to the Affordable Care Act, including one just issued on December 31.
    The pertinent guidance relating to the reporting of enrollment data is found in the October 3 draft manual in Section 2.4 Relationship between Premium Payments and the Confirmation/Effectuation 834 Transaction. Some of this guidance is already outdated, such as these statements: "Issuers do not have the ability to grant grace periods for payment of the initial month’s premium" and "...issuers may receive payments the day prior to the enrollee’s coverage effective date."  Once it became clear that January 1 coverage would be jeopardized for many due to problems with the website, CMS worked with insurers to extend payment due dates to January 10 in some cases.  California, which operates its own exchange, extended the payment deadline to January 15.  Several Blue Cross Blue Shield plans, including Illinois and Texas, have extended their deadlines all the way to January 31 according to a Wednesday report from Reuters.
    The portion of the guidance from the October 3 manual that directly impacts the timing of reporting, which technically only applies to the Federally Facilitated Exchanges (FFEs) but practically speaking would affect the state exchanges also, reads as follows [emphasis added]:

For purposes of generating the confirmation transaction, full payment occurs when the issuer receives full payment... of the portion of the premium for which the enrollee is responsible. We realize that some enrollees will wait until just prior to their coverage effective date to make payment, and therefore issuers may receive payments the day prior to the enrollee’s coverage effective date. In such circumstances issuers may not be able to transmit all confirmation transactions prior to the coverage effective date. However, the FFM expects QHP and QDP issuers to send all confirmation transactions by the fifth calendar day of the effective month of coverage. 

    Under the original guidance, this would have meant all insurers would have been required to send confirmations to CMS by January 5.  However, with the payment deadlines extended to as late as January 31, those insurers presumably have until as late as February 5 to transmit the confirmation of paid enrollments for coverage effective January 1 to CMS.  Again, although this guidance applies specifically to FFEs, state exchanges will need to transmit confirmations to CMS as well in order to have tax credit subsidies processed and paid to insurers.  As noted in the guidance, insurers must send confirmations after receiving payment from consumers and not wait for the balance of the payment from ant government subsidy.  It is unclear when and how those subsidies will be remitted to insurers since the "back end" of the system is apparently still under construction.

    February 5 may actually be an optimistic estimate of when complete paid enrollment data will be available.  The following diagram is from a March 2013 version of a CMS document regarding transaction information in the FFEs:

    Although revisions of this process will have changed the information flows illustrated by this diagram, the inclusion of information from state exchanges will certainly not make the accumulation of aggregate enrollment data any simpler.  The public may have to wait until mid-February or later to find out the true Obamacare enrollment as of its January 1, 2014 debut.


Note: A version of this article first appeared at The Weekly Standard.

HHS "Corrects" Obamacare Rule, Waives Comment Period and 30-Day Delay

    On New Year's Eve day, a Department of Health and Human Services (HHS) rule correction was entered in the Federal Register related to an Affordable Care Act rule that had been finalized two months earlier.  The published version of the rule entitled (in part) ‘‘Patient Protection and Affordable Care Act; Program Integrity" , subpart M (‘‘Oversight and Program Integrity Standards for State Exchanges’’), failed to include a cross-reference to the small business health options program (SHOP) Exchanges section of the regulations. This "technical nonconformity" meant that SHOP's were not subject to the new rule.  Since HHS believed the intent of the original rule was clear, the correction was made without the usual comment period and 30-day delay before the rule would take effect in 2014.
    The substance of the correction is explained in the Federal Register as follows:

On page 65095, in the Federal Register of October 30, 2013, we added subpart M ‘‘Oversight and Program Integrity Standards for State Exchanges’’ to the regulations text at 45 CFR part 155. While it was clear from the preamble and regulations text that subpart M applies to all Exchanges, including small business health options program (SHOP) Exchanges, due to an oversight we inadvertently omitted cross-referencing new subpart M at § 155.705(a) of the regulations in part 155, subpart H—Exchange Functions: Small Business Health Options Program. Accordingly, we are revising § 155.705(a) so that the regulations in part 155 consistently reflect our policy that all Exchanges, including SHOP Exchanges, must carry out the required functions of an Exchange that are set forth at subpart M. We are correcting § 155.705(a) by adding a cross reference to subpart M, so that the provision reads, ‘‘Exchange functions that apply to SHOP’’. The SHOP must carry out all the required functions of an Exchange described in this subpart and in subparts C, E, K, and M of this part, except..."

    The notice explains that the comment period and 30-day delay may be waived "if the Secretary finds for good cause that the delay is impracticable, unnecessary, or contrary to the public interest, and incorporates a statement of the findings and the reasons therefor in the rule issued."
    In late November, the Obama administration announced that online enrollment for the federally facilitated SHOP's would be delayed for a year due to problems with the Healthcare.gov site.  The SHOP program, however, is still available to businesses through brokers, and is also available for businesses in states operating their own online insurance exchanges.


Note: A version of this article first appeared at The Weekly Standard.

Eric Holder: School Fights are "Relatively Minor Transgressions"

    Wednesday, Attorney General Eric Holder gave a speech at Frederick Douglas High School in Baltimore, MD.   I wrote about the announcement of the appearance at The Weekly Standard earlier in the day.  The event was billed as "Solutions to Enhance School Climate/Improve Discipline Policies and Practices".  Holder was there with Education Secretary Arne Duncan as part of President Obama's anti-gun violence initiative launched in response to the Sandy Hook Elementary School shooting.
    Part of the president's plan was to "disseminate best practices on school discipline policies and to help school districts develop and equitably implement their policies."  In fleshing out this proposal, Holder made a rather strange, even alarming, statement:

As it stands, far too many students across the country are diverted from the path to success by unnecessarily harsh discipline policies and practices that exclude them from school for minor infractions.  During critical years that are proven to impact a student’s later chances for success, alarming numbers of young people are suspended, expelled, or even arrested for relatively minor transgressions like school uniform violations, schoolyard fights, or showing “disrespect” by laughing in class.

    Holder's formulation conflates "schoolyard fights" with school uniforms violations and laughing in class, clearly a false equivalence.  While the latter two items might be characterized as "relatively minor transgressions," does a physical altercation really fit the bill?  Fights do not begin spontaneously - usually there is an aggressor, which probably indicates an assault and battery has occurred.  Certainly not all fighting in school rises to the level of arrest, but shouldn't suspensions or even expulsion be on the table?  And has anyone ever really been arrested, or even expelled, for a uniform violation or laughing in class?  Unlikely.
    Why would Holder muddy the waters in this way?  How does preventing violence in schools square with downplaying the seriousness of... violence in schools?  As I pointed out in my Weekly Standard post, the whole Baltimore event seemed predicated on the idea that unfair, discriminatory, and ineffective school discipline could lead to gun violence.  If Holder truly subscribes to that line of thinking, he should stop trying to get schools to go easy on violent offenders by comparing them to the merely disrespectful and dress code violators.

Healthcare.gov Still Promoting Coverage Effective January 1 [Updated]

    Six days into the new year and fourteen days after the extended December 23 deadline, the federal Obamacare website Healthcare.gov is still holding out hope of coverage beginning January 1 to some consumers.  The notice, which first appeared on December 24 (the unofficial extra-extended deadline), advises consumers who had "problems" with the website to call the Marketplace Call Center which may offer the option of "starting a new application over the phone to get coverage effective on January 1."

    No additional details are given about what type of "problems" might qualify one for the special treatment or what kind of proof might be required from consumers that they experienced a qualifying problem.  Also unclear is how the government could require an insurer to offer coverage retroactive to January 1 to a consumer who began a "new application" almost a week past the effective coverage date.

    A Healthcare.gov chat agent contacted late Sunday night said that the option is no longer available, and that the "earliest your coverage could start now is February," yet the notice has not been removed.  An email to the Health and Human Services press office about the website page offering coverage effective January 1 was not immediately returned.

UPDATE: Some time on Tuesday, the website was updated to remove the above message.  It was replaced with this:

    The change was not notated.

Note: A version of this article (before the update) first appeared at The Weekly Standard.

FDA Seeking Gum Chewing Tester

    The Food and Drug Administration is seeking a small business to potentially supply the federal agency with a chewing gum tester.  Despite the frivolous sounding nature of the announcement, the search is a serious one, and apparently a growing need.  Chewing gum-based pharmaceuticals (such as nicotine gum) are already in use in the United States, and the FDA is looking for a way to measure the dosage and delivery (dissolution) of the medication in such products.
    The FDA is not looking for just any chewing gum tester, but the Erweka DRT-3 (or its equal), manufactured by Erweka, a German company that produces pharmaceutical and life-science testing equipment.  The DRT-3 can be seen in action here.
    According to the documents accompanying the notice, the FDA may be looking to establish a standard for testing chewing gum-based pharmaceuticals on the assumption that the gum-based method of drug delivery may become more widely used:

Currently, there is no official method (USP or FDA) to test medicated chewing gum products, and it is unclear for FDA reviewers on how to approve such drug products if similar applications are coming in the future...

The DRT-3 chewing gum dissolution tester will be evaluated and used to develop methods for drug release from commercial chewing gum products. The requested instrument will greatly enhance our dissolution testing efforts by evaluating new technology and validating testing methods. All these efforts will greatly support CDER’s NDA/ANDA review process on this special dosage form in the future.  

    The FDA has some very specific criteria in mind for its gum chewing tester, including:

• The angular displacement of the upper jaw shall be adjustable between 10° – 180°, movement frequency adjustable between 20 - 60 cycles per minute.
• Distance of upper and lower jaw in closed position adjustable -between 0-10 mm.
• Jaws shall be acid proofed stainless steel with blasted surface for a better grip.

There is no requirement that the machine must be able to walk and chew gum at the same time.


Note: A version of this article first appeared at The Weekly Standard.

Obamacare Contractor Blamed for Slow Medicare Payments to Hospitals

    The contractor building the financial management system for Healthcare.gov is being blamed by a Houston hospital for delayed Medicare reimbursements that have caused the hospital to miss payrolls for weeks. Novitas Solutions is the federal government's new Medicare payment processor for the south-central region of the country hired by the Centers for Medicare and Medicaid Services (CMS), a division of the Department of Health and Human Services (HHS.)  ABC's KTRK in Houston reports:

According to the CEO Jason Leday, more than 150 employees haven't been paid in nearly a month. 

"I understand that they have children and a house payment, bills. Not getting paid is wow," nearby resident Theresa Gutierrez said. 

The hospital is strapped for cash not because its not making money, but because Leday says a new Medicare payment facilitator named Novitas Solutions is taking too way long to pay out Medicare claims to the hospital. 

Leday says he's owed nearly $3 million in payments from Medicare and can't make payroll...

The Texas Medical Association says they are familiar with complaints like this one regarding the medicare payment facilitator- and a representative told us smaller community hospitals like this one are in similar situations. 

    Novitas also runs the south-central region's Medicare website which was launched just two days before the October 1 launch of Healthcare.gov.  As THE WEEKLY STANDARD reported on December 19, that site has experienced problems reminiscent of Healthcare.gov's troubles, and the site will not be fully operational until well into 2014.
    Novitas's direct connection to Healthcare.gov stems from an emergency, no-bid contract for "financial management services" awarded in August and first reported by THE WEEKLY STANDARD in September.  The services required included accounting, tracking of accounts receivable and accounts payable, documenting funds collected by CMS, and data validation, among other things.  CMS justified the no-bid award because the "prospect of a delay in implementing the Marketplace by the operational date of January 1, 2014, even for a few days, would result in severe consequences, financial and other" and that the services required were "beyond what was initially anticipated and beyond CMS' currently available resources."
     Novitas did not respond to KTRK for its story, and so far has not responded to a request for comment since the story ran.  In the past, Novitas has referred requests for comment to HHS.
    Despite initially promising more information about the August contract, HHS/CMS has ignored repeated requests for clarification about the nature of the work and how it relates to the mission of Healthcare.gov.  HHS has not responded to a request for comment about the reports of slow payments to hospitals either.


Note: A version of this article first appeared at The Weekly Standard.