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The First Fill Factor: A Threat To Outcomes, Quality, And Payment Goals


April 1st, 2015

Enactment of the Medicare Part D Prescription Drug Program in 2003 led to the creation of the first medication adherence quality improvement goals of truly national import. But one gaping problem remains: the failure of many patients to secure and take medications when they are first prescribed — the “first fill” that never happens.

Recent research confirms that rates of failure to secure a first dose of newly prescribed medications in major chronic disease categories are disturbingly high. Indeed, the failure rates in community-based settings (at community pharmacies, for example) range from 22 to 28 percent. Substantial rates of failure (15 to 26 percent) have even been found among highly integrated health care systems that often feature in-house pharmacies.

And so, just as payment reforms are pushing providers towards accountability for safe and appropriate treatment and good patient outcomes, particularly among the chronically ill, a significant proportion of patients are walking away from their provider’s office with sound, evidence-based orders for new medication therapy … but they never pick up the medicine.

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Health Affairs Briefing: The Cost And Quality Of Cancer Care


March 25th, 2015

Cancer is the second leading cause of death among US adults, and cancer care now costs in excess of $125 billion each year in the United States alone. Cancer has also become the second leading cause of death worldwide, making it an increasing priority in low- and middle-income countries. The April 2015 issue of Health Affairs, “The Cost and Quality of Cancer Care,” includes a collection of papers on the cost and quality of cancer care.

You are invited to join us on Tuesday, April 7, 2015, at a forum featuring authors from the new issue at the National Press Club in Washington, DC. Panels will cover valuing cancer care innovation, paying for care, and quality of cancer care.

WHEN:
Tuesday, April 7, 2015
9:00 a.m. – 11:40 a.m.

WHERE:
National Press Club
529 14th Street NW
Washington, DC, 13th Floor

Register Now!

Follow live Tweets from the briefing @Health_Affairsand join in the conversation with #HA_CancerCare.

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Ensuring Timely Approval Of Generic Drugs


March 24th, 2015

Having saved US consumers over $1.5 trillion in the past decade, generic drugs are one of the most cost-effective interventions in our entire health care system. Using generic drugs instead of brand-name drugs, when a generic is available, has been shown to increase medication adherence and improve health outcomes for chronic conditions.

Importantly, generic drugs offer these advantages without sacrificing quality; the Food and Drug Administration’s bioequivalency standards are met and often exceeded by generic-name manufacturers, and no randomized controlled trials—the gold standard of medical evidence—have identified clinically significant variations in outcomes between brand-name and FDA-approved interchangeable generic drugs.

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What Is Behind The Post-Recession Bend In The Health Care Cost Curve?


March 23rd, 2015

It has been a while since I last had the opportunity to analyze the slowdown in health spending and the extent to which it represents a lasting bend in the cost curve, as opposed to lingering effects of the “Great Recession or other temporary changes.” (See Note 1)

Distinguishing Health Care Cost Curves

When we discuss bending the health care cost curve, two questions arise: “Which curve?” and “Short run or long run?” In this post, I focus on the curve represented by the growth rate in national health expenditures (NHE) pre- and post-recession. Other curves of interest include “excess growth” (health spending growth in excess of gross domestic product [GDP] growth) and the closely related health spending share of GDP. For analysis of all three curves over the very long run, including a provocative “big bang” theory about the origins of excess growth, see Tom Getzen’s blog. A fourth curve that has gotten my attention, through the work of Gene Steuerle, is the health spending share of the growth in real per capita GDP. (See Note 2)

I now turn to the present topic, the record low growth in NHE that began in 2009 (the year in which the recession ended) and continued through 2013 (the most recent year for which we have official data). There has been extensive discussion about whether these low rates are the result of temporary cyclical factors, such as the recession, or more permanent structural factors. As detailed below, I conclude that, to a surprisingly large extent, the answer is neither: the bulk of the decline in the health care spending growth rate resulted from lower economy-wide price inflation and some temporary factors not tied to the recession.

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New Health Policy Brief: Right-To-Try Laws


March 10th, 2015

A new policy brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) looks at so-called Right-to-Try laws. For patients with serious, potentially life-threatening diseases, current federal regulations offer two routes to gain access to experimental drugs not yet approved by the Federal Drug Administration (FDA): participation in a clinical research trial, or, if not possible, applying to the FDA for use of a drug under the expanded access (also known as compassionate use) program.

While the FDA has approved nearly all of these applications, the process is widely thought to be overly cumbersome. Since last year, five states have enacted their own Right-to-Try laws, with the aim of giving critically ill patients the treatments they seek. This health policy brief provides background on the federal regulations of expanded access and the recent involvement by many states.

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Go Slow On Reference Pricing: Not Ready For Prime Time


March 9th, 2015

Editor’s note: This post is part one of two on reference pricing. 

The use of reference pricing by health insurers and employee health benefit plans stands high on the policy and regulatory agenda because it is gaining popularity, particularly now that federal agencies have blessed its use by large group insurers and self-insured plans, while imposing only relatively lax requirements. The purpose of reference pricing is to enable patients to “shop” for care and to spur provider competition by creating a group of “designated” in-network providers that agree to abide by the reference price while others do not (“non-designated providers”).

Patients who select more expensive non-designated providers must pay extra, letting them decide whether the extra out-of-pocket cost is worth it. Providers compete, either by agreeing to the reference price or by lowering their prices to approach it. Prices are driven downward.

Reference pricing is superficially appealing because it invokes powers that consumers exercise every day, as they weigh cost and value for items ranging from cold cereal to new cars. But it also raises significant issues regarding quality and access to care and has the potential to discriminate against sick and vulnerable patients. The strategy may also prove costly in relation to the benefits it confers. We urge a go-slow approach and more careful regulation.

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Open Payments: Early Impact And The Next Wave Of Reform


March 3rd, 2015

Editor’s note: This post is part of a series stemming from the Third Annual Health Law Year in P/Review event held at Harvard Law School on Friday, January 30, 2015. The conference brought together leading experts to review major developments in health law over the previous year, and preview what is to come. A full agenda and links to video recordings of the panels are here.

The Physician Payments Sunshine Act, a provision in the Affordable Care Act, seeks to increase the transparency of the financial relationships between medical device and drug manufacturers, physicians, and teaching hospitals. Launched on September 30, 2014 by the Centers for Medicare & Medicaid Services (CMS), the Open Payments database collects information about these financial relationships and makes that information available to the public.

As of early February, the Open Payments database includes documentation of 4.45 million payments valued at nearly $3.7 billion made from medical device and pharmaceutical manufacturers to 546,000 doctors and 1,360 teaching hospitals between August 2013 and December 2013. This included 1.7 million records (totaling $2.2 billion) without the names of physicians or teaching hospitals who received the payments.

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Health Affairs’ March Issue: The Benefits And Limitations Of Information


March 2nd, 2015

The March issue of Health Affairs contains papers focusing on the benefits—and the limitations—of information-gathering processes as a way to solve health system problems. Studies in this variety issue examine US hospital rating systems, disclaimers on dietary supplements, state prescription drug monitoring programs, the value of US versus Western European cancer care and other topics.

National hospital rating systems show little agreement — what’s a consumer to do?

Matt Austin of Johns Hopkins Medicine and coauthors compared four well-known national hospital rating systems designed for use by US consumers: U.S. News & World Report’s Best Hospitals; HealthGrades’ America’s 100 Best Hospitals; Leapfrog’s Hospital Safety Score; and Consumer Reports’ Health Safety Score. They analyzed ratings covering the time period from July 2012 to July 2013.

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Exhibit of the Month: Improving Pharmaceutical Innovation


February 27th, 2015

Editor’s note: This post is part of an ongoing “Exhibit of the Monthseries. Readers who’d like to highlight other noteworthy exhibits from the same issue are encouraged to make their pitch in the comments section below.

This month’s exhibits, published in the February issue of Health Affairs, illustrate annual new drug approvals by the Food and Drug Administration (FDA), industry spending on research and development, and more specifically, the number of drugs approved per $1 billion spent on research and development.

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Top 5 Health Care Trends to Watch in 2015


February 25th, 2015

With a new Congress, health care is once again an issue of tremendous scrutiny and debate. Many of the federal policy debates in 2015 will be largely symbolic, resulting in little more than tweaks to existing law.

However, health care policy is not just a matter for Congress to consider. A range of issues will play out in the states and the private sector, effectively shaping the future. Below are the top trends we’re watching this year.

The Year of Living Interoperably

From electronic health records (EHRs) to clinical measures and decision support tools, providers are inundated with new technologies that automate processes and capture new types of data. However, these systems are limited in their potential because they don’t all “talk” to one another. They’re locked away within proprietary technologies that render them the equivalent of an email account that only sends messages to people in your company, or a phone that only makes calls in your house.

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Implementing Health Reform: Final 2016 Letter To Federal Exchange Issuers


February 22nd, 2015

Each year the Centers for Medicare and Medicaid Services (CMS) releases a letter to issuers (insurers) in the federally facilitated marketplace (FFM) setting out the ground rules for coverage through the FFM for the coming year.  A draft letter is published for comments, followed by the final letter.  The letter addresses insurers that issue qualified health plans (QHPs) in the FFM, including stand-alone dental plans (SADPs), and covers the small business (FF-SHOP) marketplace as well as the individual marketplace.

On December 19, 2014, CMS  published the draft 2016 letter which I covered here.  On February 20, 2015, CMS published the final letter to issuers in the federally facilitated marketplace.  Not surprisingly, since it  covers the third year of operation of the marketplace, the 2016 letter is quite similar to those of preceding years.   The letter is based on previously published rules governing QHPs and the marketplaces, as well as on the final 2016 Benefit and Payment Parameters Rule, covered here (CITE) and here (CITE), from which it incorporates many provisions.

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Implementing Health Reform: 2016 Benefit And Payment Final Rule, Consumer & Provider Provisions


February 22nd, 2015

On February 20, 2015, the Centers for Medicare and Medicaid Services (CMS) of the Department of Health and Human Services published its massive Notice of Benefit and Payment Parameters (BPP rule) for 2016 Final Rule, accompanied by a fact sheet.  This rule addresses a host of issues involving the continuing implementation of the Affordable Care Act for 2016.  A few provisions, however, affect the 2015 year as well and a number of provisions will not be implemented until 2017.

The BPP rule amends and updates existing rules; thus, it must be read in tandem with rules that have been promulgated earlier, which are catalogued in the preface to the rule.

CMS released also on February 20 its Final 2016 Letter to Issuers (Insurers) in the Federally-Facilitated Marketplace (FFM).   This letter sets the ground rules for insurer participation in the FFM for 2016 and covers many of the same topics covered by the BPP rule.

These documents are very lengthy and will be covered in three posts over the next few days.  This first post will focus on issues in the BPP rule that directly affect consumers.  The second post will focus more on issues that affect health plans.  The third post will examine the letter to issuers.

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The Need For Publicly Funded Trials To Get Unbiased Comparative Effectiveness Data


February 20th, 2015

Comparative effectiveness research was one of the hotly debated components of the Affordable Care Act. The pharmaceutical industry is marketing driven, with pharmaceutical companies spending more on marketing than they do on research and development. The need for a marketing edge can also drive drug development.

As illustrated by the discussion below of Gazyva and Nexium, drugs can be developed at higher doses than the drugs they are intended to replace. When the newer, higher-dose drugs are tested against the older, lower-dose drugs, the trials are intended to show that the newer, higher dose drugs are superior to the older drugs that will soon be available as a biosimilar or generic.

It can be very difficult to tell whether the results of such trials reflect the differences between the active ingredients or simply the difference in doses, but such trials are almost certain to lead to increased use of the newer, higher-priced drugs. Because the money at stake creates such an incentive for companies to stack the deck, publicly funded trials are the only way to make sure that evidence-based medicine is based on the best possible evidence.

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Vaccinating Against Iron-Deficiency Anemia: A New Technology For Maternal And Child Health


February 19th, 2015

When we think of killer diseases of global health importance, iron-deficiency anemia (IDA) is not something that immediately comes to mind. Yet the December 2014 publication of leading causes of death by the Global Burden of Disease Study 2013 reveals that IDA kills an estimated 183,400 people annually. To put this number in perspective, in the year 2013, IDA killed more people worldwide than ovarian cancer. In terms of years of life lost, IDA ranked higher than cervical cancer.

The fact that we compared IDA to two other well-known threats to the health of women is no accident. Because women of child-bearing age have low underlying iron reserves, they are at great risk of becoming deficient in iron and progressing to IDA. Pregnant women are especially vulnerable to IDA because of the high iron demands of the growing fetus. Growing children represent another important group who develop IDA.

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In The Debate About Cost And Efficacy, PCSK9 Inhibitors May Be The Biggest Challenge Yet


February 17th, 2015

The American health care system is far and away the most costly in the world. Health care reform is intended to lower costs, but they are still rising, albeit less steeply than in the past. Moderation is not however the case in the area of specialty pharmacy. The medications to treat Hepatitis C are the most cited examples of a general inflationary trend, but the pipeline of expensive medications is extensive.

Yet, policymakers and payers appear unwilling to undertake significant cost controls on medication pricing. Indeed the controversy over the $84,000 price tag for Sovaldi (sofosbuvir) has largely faded, suggesting a certain resiliency in our system’s ability to absorb costs.

We believe that resiliency is about to be challenged in a manner unlike we have seen in the past, at least in the area of pharmaceuticals. A number of pharmaceutical manufacturers are developing a new class of medication to manage high cholesterol — the PCSK9 (proprotein convertase subtilisin/kexin 9) enzyme inhibitors.

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The Puzzle Of Antibiotic Innovation


February 3rd, 2015

Editor’s note: This post is part of a series stemming from the Third Annual Health Law Year in P/Review event held at Harvard Law School on Friday, January 30, 2015. The conference brought together leading experts to review major developments in health law over the previous year, and preview what is to come. A full agenda and links to video recordings of the panels are here.

Dame Sally Davies, the Chief Medical Officer of England, warns that we are approaching an antibiotic apocalypse. A former chief economist at Goldman Sachs estimates that unless dramatic action is taken now, antimicrobial resistance could kill 50 million people a year and cause $100 trillion in cumulative economic damages.

In the US, dire warnings have issued from the Centers for Disease Control and Prevention (CDC), the President’s Council of Advisors on Science and Technology, and the President himself through an Executive Order on Combating Antibiotic-Resistant Bacteria in September 2014 (summary here). The President’s new budget asks for $1.2 billion to be spent on antibiotic resistance.

But last week, the science press breathlessly celebrated the discovery of a new antibiotic, teixobactin, cultured from soil samples collected in a grassy field in Maine (the study was published in Nature). Crisis over?

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How Hepatitis C Is Shining A Light On Critical Gaps In Payment Reform


February 3rd, 2015

Since December 2013, regulatory approval of new treatments for hepatitis C have brought long simmering debates on drug pricing and value to full boil. The drugs—Gilead’s Sovaldi and successor combination treatment Harvoni, AbbVie’s Viekira Pak—represent significant steps forward for treatment in hepatitis C, demonstrating cure rates well above 90 percent in the clinical trial setting as well as greater tolerability for patients.

This unprecedented effectiveness, however, has come at a high cost, with treatment ranging from $63,000 for an eight-week course of Harvoni on the low end to above $150,000 for Sovaldi in combination with other products on the high end. This is likely to be representative of a wave of similar products coming through the drug development pipeline: highly targeted, highly effective, and highly priced.

Also indicative of things to come are the steps some groups are taking to blunt the impact of increased spending on hepatitis C treatments, such as formulary adjustments or prioritized coverage for particular subsets of the hepatitis C patient community. Days after the U.S. Food and Drug Administration (FDA) approved AbbVie’s Viekira Pak in December 2014, for example, the largest pharmacy benefit management company in the United States, Express Scripts, announced that the drug regimen would be the only hepatitis C treatment on its preferred list of covered drugs.

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Health Affairs’ February Issue: Biomedical Innovation


February 2nd, 2015

The February issue of Health Affairs includes a number of studies examining issues pertaining to biomedical innovation. Some of the subjects covered: how declining economic returns for new drugs may affect future investments, the changing landscape of Medicare coverage determinations for medical interventions, the slowly emerging US biosimilar market, and more.

With declining economic returns, can manufacturers afford to continue investing?

Ernst Berndt of Massachusetts Institute of Technology’s Alfred P. Sloan School of Management and coauthors compared present values of average lifetime pharmaceutical revenues to present values of average drug research and development, and lifetime operating costs. Upon examining new prescription drugs launched over four distinct time periods between 1991 and 2009, the authors found that net economic returns reached a peak in the late 1990s and early 2000s.

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Health Affairs Briefing: Biomedical Innovation


January 20th, 2015

Biomedical innovation lengthens and enriches our lives through breakthroughs in medications and care, but it is has also been the leading source of health care cost growth over the past few decades. The upcoming February 2015 thematic issue of Health Affairs examines the topic from many perspectives.

You are invited to join us on Thursday, February 5, at a forum featuring authors from the new issue at the W Hotel in Washington, DC.  Panels will cover pharmaceuticals; biotechnology; medical devices; and accelerating, diffusing, and financing innovation.

WHEN: 
Thursday, February 5, 2015
9:00 a.m. – 12:30 p.m.

WHERE: 
W Hotel Washington
515 15th Street NW
Washington, DC, Great Room, Lower Level

Register Now!

Follow live Tweets from the briefing @Health_Affairsand join in the conversation with #HA_BiomedInnovation.

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A (Global) Cornucopia Of Clues To Optimize Medication Use


January 6th, 2015

The most common patient care intervention, issuing a prescription, is fraught with continuing challenges for patients, their caregivers, and practitioners. Patients rely on medications across a continuum of care, with expectations for self-management; some experience unintended problems along the way. For older patients, such problems often result in emergency hospitalizations, many of which could be prevented.

Historically, integration to support safe and appropriate medicine use across the U.S. health care ecosystem has been sporadic, including within our siloed Medicare Part D benefit. Other countries, however, are well on their way to better integration.

In the following blog post, we share examples from the United Kingdom and Australia. Fortunately, U.S. practitioners who recognize optimizing medication use as an essential element of population health can look to several recent federal opportunities to support their efforts.

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