A U.S. Food and Drug Administration panel voted today to place stricter controls on popular narcotic painkillers.

The 19 to 10 vote, which is advisory, will help the FDA decide whether to recommend moving drugs such as Vicodin, which contain the opioid painkiller, hydrocodone, from Schedule III to Schedule II under the Controlled Substances Act.

Ever since coming on the market 40 years ago, hydrocodone drugs have had fewer restrictions on them than drugs such as morphine and OxyContin, which contains the opioid oxycodone.

However, as overdose deaths and addiction rates soared over the past decade or so, putting stricter controls on hydrocodone has been the focus of efforts to reform the use of opioids and deal with America's opioid epidemic.

Stricter Schedule II status means that fewer prescriptions can be written at one time. For each visit to the doctor, a patient can get up to six months of prescriptions of Schedule III opioids such as Vicodin, compared with up to three months for Schedule II drugs.

Schedule II drugs also have stricter handling and storage requirements.

It was not known when the FDA would make a final decision on the issue.

Source: Journal Sentinel, January 25, 2013.

In late November, Anthem Blue Cross announced that it would soon begin requiring contracted physicians to notify patients in writing before making out of network referrals. Effective March 1, the payor’s new “Advance Notice for Use of a Non-Participating Provider Policy” (APN policy) requires this notice be given using the payor-provided APN form. The policy does not apply to emergencies.

While Blue Cross has included language in its contracts since 2008 requiring physicians to disclose to patients and document the same type of information included in the APN form, it was not often enforced.

According to Blue Cross, it frequently receives complaints from patients who were unaware that they were being referred to out-of-network providers. The payor says that its new policy is not intended to deter patients from using their out-of-network benefits. Rather, it is intended to help patients make informed decisions about their coverage and options.

Governor Jerry Brown promoted his fiscal year 2013-2014 budget proposal and discussed several state health care initiatives in In his State of the State address yesterday. 

Budget Comments

Earlier this month, Brown released his budget plan. He said that if implemented, the proposal would leave the state with a budget surplus of $851 million. The plan projects $98.5 billion in revenue and transfers, and it estimates $97.7 billion in spending.

Brown's plan includes an expansion of Medi-Cal to individuals with incomes up to 138% of the federal poverty level. The expansion—included in the Affordable Care Act—is expected to add up to 1.5 million newly eligible adults to the program.

The budget plan also includes a 4.9% funding increase for In-Home Supportive Services—with an assumption that the state will implement a 20% reduction in IHSS service hours in November—and a $142 million funding increase for Cal-WORKs, the state's welfare-to-work program

In addition, the budget proposal allocates $1.6 billion for a court-appointed federal overseer to manage continued improvements in the state's prison health care system.

Health Care Comments

Discussing the Medi-Cal expansion, Brown called the initiative "incredibly complex" and said it will "test our ingenuity" and "will not be achieved overnight." He said, "Given the costs involved, great prudence should guide every step of the way."

Brown also said that the state must develop "the right relationship with the counties" to successfully implement the expansion.

Brown also called for a special session of the Legislature beginning next week that will focus on implementing ACA provisions.

Source: California Healthline, January 25, 2013.

On January 18, 2013, the Government Accountability Office (GAO) announced that they denied Palmetto’s protest, awarding the Medicare contract for Jurisdiction E (previously referred to as J1) to Noridian Administrative Services. Noridian and Palmetto are awaiting further direction from CMS on the transition plan, including a transition date.

SFMS/CMA will work closely with them to help ensure a smooth transition. Until further direction is received, members should continue with business as usual.

The California Health Benefit Exchange Board officials outlined an agenda to prepare the exchange to launch on January 1, 2014.

Exchange Details

The Affordable Care Act requires states to launch online insurance marketplaces by 2014. California's exchange—named Covered California—primarily will serve individuals and small businesses.

Supporters hope that the exchange will function similar to websites like Amazon and Expedia so that users will be able to choose between various health plans through an easily navigable online store.

Earlier this month, the Obama administration granted conditional approval to California's plan to build and operate a statewide health insurance exchange.

Last week, federal officials awarded $674 million to the exchange, which will help fund the program through the end of 2014.

Details of Agenda

Officials said that the state expects to develop seven geographical exchanges to serve markets in:

• The Central Coast
• The Greater San Francisco Bay Area
• Los Angeles
• Northern California
• Sacramento
• San Joaquin Valley
• Southern California

Officials also established an action plan for recruiting translators fluent in 13 languages spoken in California to help with outreach efforts.

In addition, officials said they would use the new federal grant funding to develop a Web portal for the exchange.

Plans Will Use 'Metal Ratings'

Recently, exchange officials told Gov. Jerry Brown (D) and the Legislature that health plans offered through Covered California will be classified by "metal ratings."

According to officials, "Every insurance policy offered inside and outside the Covered California marketplace will be given a 'metal rating' based on 'actuarial value' calculations."

• Platinum plans will offer 90% coverage;
• Gold plans will offer 80% coverage;
• Silver plans will offer 70% coverage; and
• Bronze plans will offer 60% coverage.

Plan members will have to pay out of pocket for the percentage not covered by the plan.

Source: California Healthline, January 22, 2013.