Biden administration goes after drug patents in bid to lower prices

By Jonathan Gardner - The White House on Thursday took steps to pressure pharmaceutical companies to lower the price of drugs developed with federal funding, backing a plan that would enable the government to sidestep patent protections for those medicines. Read Full Article…

VBA Article Summary

1. New Price Considerations in March-in Rights: The National Institutes of Standards and Technology's draft guidelines allow government agencies to consider the "reasonableness of the price" when deciding to invoke march-in rights. These rights enable the government to suspend patents on federally funded inventions that aren't made accessible to the public. The guidelines specify that action can be taken if the price is "extreme, unjustified, and exploitative of a health or safety need," including in situations like sudden price hikes after disasters or initial high costs at drug launches.

2. Soliciting Stakeholder Feedback: The guidance, stemming from an interagency review initiated earlier this year, is open for further comment before its finalization. U.S. Secretary of Commerce Gina Raimondo emphasized the aim to balance innovation incentives with ensuring public access to innovations. The march-in rights, part of the 1980 Bayh-Dole Act, have rarely been used despite several requests, as agencies have historically declined to intervene in cases like Genzyme's Fabrazyme and the prostate cancer drug Xtandi.

3. Diverse Reactions from Industry and Advocates: The main pharmaceutical trade group, the Pharmaceutical Research and Manufacturers of America (PhRMA), criticized the new guidelines, fearing it would discourage collaboration due to the risk of losing patent protections. Conversely, advocacy groups like Knowledge Economy International welcomed the guidelines, though they expressed concerns about the ambiguity in defining terms like "extreme" or "exploitative" prices. The guidance is seen as a significant shift from the original intent of the Bayh-Dole Act's authors, who didn't envisage price as a factor for using march-in rights.

Hospitals across the country are dumping Medicare Advantage plans and canceling their contracts with insurers

By Trudy Lieberman - Something strange happened on the way to health insurance nirvana.  Hospitals are dumping some Medicare Advantage plans. Such a move would have been unthinkable a year ago when Advantage plans were the high flyers of the insurance business raking in money by signing up new recruits, a substantial number of them with little or no understanding of the trade-offs involved in what they were buying. Read Full Article…

VBA Article Summary

1. Misleading Marketing and Limited Coverage: The article highlights how TV ads featuring characters like Martha, Karen, and Joe Namath entice people to sign up for Medicare Advantage plans with the promise of no monthly premiums and additional benefits like grocery cards. However, these plans often lead to less health care coverage and higher out-of-pocket expenses in times of illness. The marketing pitches typically don't mention the potential for delayed diagnostic tests, partial bill coverage, or the inability to buy a Medigap plan unless the person meets certain health criteria.

2. Hospitals Rejecting Medicare Advantage Plans: The article discusses a new development where hospitals, like the Brookings Hospital System in South Dakota, are increasingly refusing to work with Medicare Advantage plans due to lower reimbursements and administrative issues. These plans often pay less than traditional Medicare and are slower in approving or outright denying necessary medical services. The Nebraska Hospital Association also issued a report stating that Medicare Advantage plans are failing patients and negatively impacting hospitals.

3. Growing Concerns and Calls for Policy Rethink: The article raises concerns about the future of Medicare, questioning the push towards Medicare Advantage plans that often delay or deny care and may lead to significant medical debts for seniors. Hospitals like Mayo Clinic and St. Charles Health System have expressed their reluctance or refusal to work with certain Medicare Advantage plans. The article suggests that it might be time to reassess the last 25 years of Medicare policy, especially considering the potential harm to seniors' financial and health well-being.

Mental health benefits: Overcoming hurdles to provide employees with better access to care

By Anson Jones - The gradual shift to acknowledging mental and behavioral health as a significant and important measure of health has created a new avenue for employee benefits and furthered care for the working world. Surveyed employers nearly all agreed that in-network access to behavioral health providers is important. That being said, the supply does not match the demand. Three in 10 respondents were unsatisfied with the efforts and quality of their vendors. Read Full Article…

VBA Article Summary

1. Challenges in Behavioral Health Accessibility: The Behavioral Health Vendor Engagement Template by National Alliance Health addresses significant issues in mental health care access. A startling four out of five behavioral health providers listed in directories may not be available for new patients, leading to extended wait times and often causing patients to abandon their search for treatment. This tool aims to streamline the process of finding mental health aid, focusing on tracking the integration process and assessing the impact of integrated care models on patient well-being.

2. Benefits of Integrated Care and Virtual Appointments: The template emphasizes the potential of integrated care to be cost-effective by reducing unnecessary referrals, emergency department visits, and hospitalizations. It highlights the efficiency of virtual appointments in reducing no-shows and time away from work, advocating for a patient-centered approach that matches individuals with providers suited to their unique needs. This approach is expected to enhance patient engagement and improve health outcomes.

3. Role of Employers in Mental Health Care: The guide underscores the responsibility of employers in fostering mental health care. It notes that while many employers offer programs to improve workforce mental health, actual engagement in these programs is often low. The template is a resource for employers to ask pertinent questions when selecting and evaluating vendors, with the ultimate goal of providing better care for employees and their dependents. National Alliance President and CEO Michael Thompson stresses the importance of standardizing higher expectations within the behavioral health marketplace to improve access and quality of mental health services.

Senators probe private equity hospital deals following CBS News investigation

By Michael Kaplan - The top Democrat and Republican on a powerful Senate committee launched a wide-ranging investigation into private equity's impact on the U.S. health care system on Wednesday. Democratic Sen. Sheldon Whitehouse of Rhode Island and Republican Sen. Charles Grassley of Iowa sent letters to a constellation of financial firms seeking information about how their dealings in the healthcare space impact patient care. Read Full Article…

VBA Article Summary

1. Senate Inquiry into Private Equity Firms in Healthcare: U.S. Senators, leading the Senate Budget Committee, have initiated an inquiry into the role of private equity (PE) firms in healthcare, focusing on their financial and patient care impacts. This action follows a CBS News investigation into the collapse of hospitals serving vulnerable American communities. The inquiry specifically targets transactions by firms like Prospect Medical Holdings and Medical Properties Trust, alleged to have drained resources from hospitals, leading to closures and compromised patient care.

2. Financial Maneuvers and Hospital Closures: The report highlights various financial strategies employed by these firms, such as large dividend payouts to owners and sale-leaseback transactions, which have plunged hospitals into debt. For instance, Prospect Medical Holdings' owners took a $1.12 billion loan in 2018, paying themselves a $457 million dividend, while the company's then-CEO received around $90 million. These moves led to the closure of critical care facilities, including Delaware County Memorial Hospital in Pennsylvania.

3. State-Level Investigations and Responses: In response to these developments, state regulators and legislators are taking steps to address the situation. For example, Rhode Island's Attorney General sued Prospect Medical Holdings for failing to pay debts, jeopardizing hospital operations. Pennsylvania's Attorney General is working towards transferring ownership of a health system to a nonprofit operator, and Connecticut is investigating the financial practices of Prospect Medical Holdings. Additionally, state legislators propose giving more regulatory power to the Attorney General's office to oversee major hospital transactions.

Adherence to weight-loss drugs is far higher with Wegovy than older medicines

By Nancy Lapid - Forty percent of patients who filled a prescription for Novo Nordisk's (NOVOb.CO) Wegovy to treat obesity in 2021 or 2022 were still taking it a year later, more than three times the rate of adherence with older medicines, according to an analysis of medical records and insurance claims data. Read Full Article…

VBA Article Summary

1. Low Persistence in Anti-Obesity Medication Use: The study published in the journal "Obesity" reveals that only a small fraction of patients continued their anti-obesity medication over a long period. Specifically, only 13% of those who started on Contrave and 10% on Qsymia between 2015 and 2022 were still taking these drugs after a year. The study included 1,911 adults, with a significant portion (25%) using Wegovy, a GLP-1 agonist initially developed for type 2 diabetes, which has effects on both blood sugar and appetite suppression.

2. Demographics and Treatment Adherence Variances: The research highlights that 75% of the study participants were female, predominantly white (76%), with 16% Black and 4.5% Hispanic individuals. Most had private insurance. Notably, greater weight loss at six months correlated with continued medication use at one year. However, adherence rates varied among privately insured individuals based on their insurance carrier. Researchers pointed out that limitations in coverage and pre-certification criteria like step therapy could affect medication persistence.

3. Economic and Clinical Implications of Anti-Obesity Drugs: The study underscores the financial and clinical aspects of anti-obesity medications. For example, Wegovy, which showed about 15% weight reduction in a pivotal trial, is priced at $1,349 per package, while a competitor drug, Zepbound, is slightly cheaper. Despite the high costs, these medications are becoming increasingly popular, with Wegovy approved for obesity treatment in June 2021. However, about 6.8% of Wegovy users in clinical trials stopped treatment due to side effects, primarily gastrointestinal issues. The study's lead researcher, Dr. Hamlet Gasoyan, emphasized the importance of understanding the real-world use of these treatments and the barriers to their continued use, particularly in light of the high costs and growing concerns over patient non-persistence.

CVS Health rebrands healthcare services business as it plots long-term growth strategy

By Heather Landi - After spending nearly $20 billion to pick up Signify Health and Oak Street Health this year, CVS rebranded its health services business to "CVS Healthspire" as it plots its long-term growth strategy. Read Full Article…

VBA Article Summary

1. Introduction of CVS Healthspire: During the Forbes Healthcare Summit, Karen Lynch, CEO of CVS, announced the launch of Healthspire, a new segment that integrates various CVS healthcare assets. This includes the pharmacy services business, care delivery assets like Signify Health and Oak Street Health, and Cordavis, a new operation focused on bringing additional biosimilars to the market. Healthspire is envisioned as a multi-payer asset integration platform, aiming to enhance healthcare journey and care delivery.

2. Strategic Developments and Acquisitions: CVS Healthspire represents a strategic evolution for CVS, moving beyond traditional pharmacy services. The recent acquisitions of Oak Street Health ($10.6 billion) and Signify Health ($8 billion) underscore CVS's commitment to expanding its health services and primary care offerings. These acquisitions align with Lynch's vision, shared at the company’s investor day in 2021, to develop a vertically integrated healthcare company. CVS’s approach includes combining clinics, pharmacies, health plans, and other services, leveraging its extensive network of drugstores and MinuteClinics, along with Aetna's significant member base.

3. Future Outlook and Healthcare Trends: Looking forward, CVS Healthspire aims to tap into the $1 trillion healthcare services market, focusing on value-based care and technological innovation, including the use of AI. The approach is patient-centric, addressing the evolving needs of an aging population and the trend towards in-home healthcare. CVS's strategy involves enhancing patient experiences and simplifying healthcare delivery while ensuring responsible use of AI to protect patient data. This comprehensive strategy places CVS at the forefront of the healthcare industry's shift towards more integrated and technologically advanced care delivery models.

This hospital's financial benefits ensure its staff doesn't stress about their own medical bills

By Lee Hafner - When innocent roughhousing between his two sons left the oldest with three missing front teeth in the fall of 2022, Richard DeFord first made sure that his injured child was safe and healthy. His next move? Start worrying about the dentist bill. Read Full Article…

VBA Article Summary

1. Background and Challenge: DeFord, a manager at Fitzgibbon Hospital in Missouri, faced a significant financial challenge when he needed three dental implants, a cost totaling $1,800. This expense was daunting, considering that over half of Americans struggle to cover an unexpected $1,000 expense, according to a 2023 Bankrate survey. DeFord's experience highlights a common issue in the U.S. healthcare system where medical emergencies can lead to substantial financial stress.

2. Solution through Paytient: Fitzgibbon Hospital offers an innovative solution through Paytient, a fintech platform that serves as an employee benefit. Paytient provides a dedicated credit card for healthcare expenses, including veterinary costs, with an interest-free payment plan for up to 12 months. Payments can be deducted from an employee's paycheck or paid through Health Savings Accounts (HSAs) or flexible savings accounts. DeFord utilized this service, using his HSA funds and Paytient card, to manage the cost of his dental implants without needing a bank loan.

3. Impact and Broader Implications: The availability of Paytient at Fitzgibbon Hospital, under the leadership of Angy Littrell, President and CEO, offers a significant relief to employees facing medical expenses. It not only helps in immediate financial management but also contributes to better employee engagement, attendance, and overall well-being. Littrell emphasizes the importance of such services in a hospital setting, where the physical and financial health of employees directly impacts patient care and workplace culture. This model presents a potential blueprint for other organizations seeking to support their employees in managing healthcare costs.

Trends to Watch in 2024

By Business Group on Health - Each year, Business Group on Health compiles “trends to watch” for the coming year. Each trend relates to a part of employer health and well-being strategy, which may be impacted by broader factors. These factors can include the economy, lingering impacts of the COVID-19 pandemic, regulation and compliance, technology and innovation, global events, the political landscape and workforce trends. Read Full Article…

VBA Article Summary

1. Escalating Healthcare Costs and Employer Vigilance: The article highlights that U.S. healthcare costs continue to rise despite technological advancements and efforts to manage waste and utilization. Factors contributing to this trend include general inflation, labor pressures, provider shortages, increased mental health needs, and delayed preventive screenings leading to more severe health conditions. Employers are striving to balance immediate cost-management with long-term systemic changes to enhance healthcare value and quality.

2. Mental Health and Chronic Conditions Focus: There is an increased employer focus on mental health and substance use disorder services, with a growing concern for youth mental health and suicide prevention. Nearly 80% of employers report a rise in mental health service utilization post-pandemic. In response, employers are expanding virtual mental health services and on-site offerings. Additionally, employers are paying more attention to cancer and chronic conditions like diabetes, emphasizing prevention and primary care to mitigate the impact of late-stage diagnoses and severity of chronic diseases.

3. Challenges in Prescription Drug Pricing and Partner Expectations: The article discusses the growing concern among employers about the sustainability and transparency of drug pricing, particularly for specialty medications and innovative treatments like cell/gene therapies and GLP-1s. Employers are exploring new pharmacy management models to control costs. Additionally, there is an increased demand for accountability and transparency from vendors and partners, with a shift towards integrating and streamlining partnerships to improve patient outcomes and employee experience.

CVS drug pricing overhaul signals a broader industry shift

By Tina Reed - CVS Health's new plan to make the way it prices prescription drugs more predictable is the latest shift by pharmacy giants to overhaul their business models amid increasing pressure from policymakers and industry upstarts. Read Full Article…

VBA Article Summary

1. Shift to Transparent Pricing: Major industry players, such as CVS Health, are moving away from complex pricing formulas towards a more transparent "cost-plus" pricing model. This change, expected to start in 2025, will involve charging health plans the base cost of a drug plus a small markup and fee. This move aims to make drug pricing more closely tied to the base cost, potentially reducing the expenses for consumers and insurers. Notably, Cigna-owned Express Scripts and Mark Cuban's Cost Plus Drugs have already adopted similar approaches, emphasizing transparency and cost-effectiveness.

2. Growing Scrutiny and Demand for Transparency: The shift to transparent pricing comes amid increased scrutiny from lawmakers and regulators on Pharmacy Benefit Managers (PBMs), who play a crucial role in setting drug prices. Controversies have arisen around the extent of savings PBMs pass to health plans and consumers versus their profit booking. Additionally, some health plans and employers, dissatisfied with traditional PBM models, have begun exploring alternative options with promises of transparent pricing, as seen with Blue Shield of California's recent move to Amazon and Cuban's drug company.

3. Implications and Skepticism: While the industry and policymakers have long called for transparent pricing, there is skepticism about PBMs fully abandoning their existing rebate models due to the significant profits involved. Questions also remain about how companies like CVS will preserve their profitability in the new model and whether this shift will genuinely lower drug costs for consumers. As companies like CVS adapt to these changes, the impact on drug affordability and the overall effectiveness of these new pricing strategies remain to be seen.