First Edition: June 26, 2014

Today's early morning highlights from the major news organizations, including reports about the effects of lower health spending on the economy.

Kaiser Health News: Health Care System Needs To Prepare For Global Warming
Kaiser Health News' reporter Lisa Gillespie writes: "Climate change is happening, and with that will come more deaths from heat-related illness and disease, according to a report released Tuesday. 'One of the most striking findings in our analysis is that increasing heat and humidity in some parts of the country could lead to outside conditions that are literally unbearable to humans, who must maintain a skin temperature below 95°F in order to effectively cool down and avoid fatal heat stroke,' the report's authors wrote. ... Dr. Al Sommer, the dean emeritus of the Bloomberg School of Public Health at Johns Hopkins University in Baltimore, was on the committee that oversaw the development of the report. He says that often overlooked in the current debate about greenhouse gases and climate change is the effect of global warming on individuals and hospitals" (Gillespie, 6/26).

The Wall Street Journal: U.S. Economy Shrinks By Most In Five Years
Gross domestic product, the broadest measure of goods and services produced across the economy, fell at a seasonally adjusted annual rate of 2.9% in the first quarter, the Commerce Department said in its third reading of the data Wednesday. ... One factor in the government's revision of first-quarter output was difficulty in estimating the impact of the Affordable Care Act on health-care expenditures. Actual health spending came in substantially lower than expected based on ACA enrollments and Medicaid data, declining at a 1.4% annualized pace in the period compared with an earlier estimate of a 9.1% increase (House, 6/25).

The New York Times: Economy In First Quarter Was Worse Than Everybody Thought
The Commerce Department revised its estimates of first-quarter gross domestic product Wednesday to show that the economy contracted at a 2.9 percent annual rate. A combination of shrinking business inventories, terrible winter weather and a surprise contraction in health care spending drove the first-quarter decline, which is the worst since the first quarter of 2009, when the economy shrank at a 5.4 percent rate. ... The new report now finds that health care spending actually subtracted 0.16 of a percentage point from the growth rate. The health care spending data in G.D.P. is a measure of how much President Obama's health reform law is reshaping health care spending patterns, and it is now showing opposite results from those reported two months ago, when the first-quarter data was initially released (Irwin, 6/25).

The Washington Post: The Economy Just Had Its Worst Quarter Since The Great Recession. Here's Why You Shouldn't Worry.
It turns out that, at an annual rate, the economy shrank 2.9 percent in the first quarter of 2014, mostly due to weak exports, weak inventories, unexpectedly weak health-care spending and the harsh winter. ... the first couple GDP estimates looked at how many more people were getting health-care insurance from Obamacare, and assumed that health-care spending would go up quite a bit. It didn't. Health-care spending actually subtracted 0.16 percentage points from GDP. That's because health-care prices and utilization haven't increased much despite the increase in health-care customers -; which is good news for our long-term budget, but bad news for our short-term growth (O'Brien, 6/25).

The New York Times: 2 V.A. Officials To Leave Posts As Agency Seeks To Remake Itself And Rebuild Trust
The Department of Veterans Affairs said Wednesday that two senior officials would be leaving their posts as the department's acting secretary moved to remake the agency and rebuild trust amid a scandal over falsified waiting lists that were used at many hospitals to hide delays faced by veterans. The two officials are Dr. Robert L. Jesse, who has been serving as the department's acting under secretary for health, and Will A. Gunn, the department's general counsel (Oppel, 6/25).

The Wall Street Journal: Two More Top Officials Depart Beleaguered VA
The Department of Veterans Affairs announced the departures of two top officials Wednesday, leaving more leadership holes at the beleaguered department. Sloan Gibson, acting VA secretary, accepted the resignation of Will Gunn, the department's general counsel, the VA said in a news release. Meanwhile, Robert Jesse, currently in charge of health care, finished his four-year term at the VA and is leaving the department, the VA said. Mr. Gunn's departure comes a little more than a month after members of the House Committee on Veterans Affairs questioned why the general counsel took more than a week to order employees to preserve records that might be involved in a then-brewing scandal surrounding VA health care (Kesling, 6/25).

The Associated Press: Va. House GOP Lays Out Medicaid Legal Strategy
Virginia House Republicans have retained a former U.S. solicitor general in preparation for a potential legal showdown with Democratic Gov. Terry McAuliffe over the governor's ability to expand Medicaid eligibility. House Speaker William J. Howell and other Republican leaders announced Wednesday they'd retained Paul Clement, who was solicitor general to former President George W. Bush and has frequently argued cases before the U.S. Supreme Court (Suderman, 6/25).

The Washington Post: In Virginia, Medicaid Expansion Fight Escalates
[Gov. Terry] McAuliffe is pushing ahead with plans to defy the GOP-led General Assembly and expand the health-care program for the poor under the Affordable Care Act. Republicans are determined to block him. On Wednesday, the fight escalated again: House Republicans announced that one of the nation's most prominent lawyers had found that the governor lacked the authority to expand the program unilaterally. Former U.S. solicitor general Paul D. Clement said on a conference call with reporters that McAuliffe does not have that power in a state where all spending, even pass-through money from Washington, must be appropriated by the General Assembly. The House paid Clement a flat fee of $25,000 for his opinion (Vozzella and Portnoy, 6/25).

USA Today: Cost Of Not Caring: Stigma Set In Stone
Stigma against the mentally ill is so powerful that it's been codified for 50 years into federal law, and few outside the mental health system even realize it. This systemic discrimination, embedded in Medicaid and Medicare laws, has accelerated the emptying of state psychiatric hospitals, leaving many of the sickest and most vulnerable patients with nowhere to turn. Advocates and experts who spoke with USA TODAY describe a system in shambles, starved of funding while neglecting millions of people across the country each year (Szabo, 6/25).

USA Today/The Tennessean: Study: Tax Refunds Could Boost Health Coverage
Few Americans, given the choice, would buy health insurance over a Christmas present. And yet, the open enrollment period for federal Marketplace plans on Healthcare.gov coincides with the winter holidays, one of the most financially stressful times of the year. That's why researchers suggest switching the open enrollment period to line up with a less stressful time. Namely, in spring, just after people have received their tax return (DuBois, 6/25).