Reimbursement Policy for Biosimilars Will Have Negative Consequences for Patients

The Centers for Medicare and Medicaid Services (CMS) have finalized a rule regarding the Medicare reimbursement methodology for biosimilar products. Biosimilars are prescription medications which have been approved by the Food and Drug Administration (FDA) as being “highly similar” to a specific biologic medication (known as the reference product).  Thus, it is easiest for most people to think of biosimilars as the equivalent of generics for small molecule brand name medications, though this is not scientifically accurate. While small molecule generics are chemically identical (save for potentially any inactive ingredients) to their respective brand name drugs—and can be because they are chemically manufactured—exact copies of biological products, by their nature of being developed from living organisms, cannot be produced,  and patients may respond differently to the reference product and the biosimilars.

Still Marked by Uncertainty: 2016 Health Insurance Marketplace

Still Marked by Uncertainty: 2016 Health Insurance Marketplace

Nearly two years ago, the Affordable Care Act (ACA) implemented a new individual insurance marketplace, along with the promise of stability and affordability. The new individual marketplace was to rival that of the employer sponsored insurance (ESI) marketplace in stability and predictability, while premiums were to rise at rates much lower than the historical average.

The Daily Dish

Of disappointment. Remember when ObamaCare was going to be like Travelocity — a pleasant e-shopping experience where you got exactly what you wanted the very first time. Not so much. Remember when it was going to “bend the cost curve” so that health care got cheaper, the entitlement spending threat miraculously disappeared, and employer health care costs did not rule out the chance of getting an actual cash raise? Not so much.

Primer: FDA and Antibiotic Development

In 2011, two million Americans were infected with—and 23,000 killed by—drug-resistant bacteria.  Over the past 20 years incidents of drug-resistant infections acquired in hospitals have increased from a low of 10 percent of all hospital acquired infections to 60 percent today.  Despite the evident need for new, novel antibiotics, almost no major pharmaceutical companies are investing in antibiotic development. Only 11 new antibiotics were approved between 1998 and 2014, and no new classes of antibiotics have been approved since 1987.

Over Half of the ACA’s Co-Ops Have Failed in Just Two Years, and More Failures are Likely

Over Half of the ACA’s Co-Ops Have Failed in Just Two Years, and More Failures are Likely

The consumer operated and oriented plans (co-ops) created by the Affordable Care Act (ACA) were intended to provide consumers purchasing coverage in the non-large group marketplace an alternative from the traditional insurance companies. The co-ops set low premiums in order to attract customers, but in the first year of operation, all but four co-ops lost more than $1,000 per enrollee, with only one co-op (Maine Community Health Options) having a positive net income in 2014. Accordingly, 12 of 23 co-ops have collapsed so far, resulting in a loss of $1.23 billion of taxpayer funds, as these co-ops were initially seeded with federal loans. The financial losses thus far represent 63 percent of the total loans disbursed to the co-ops, and up to another $1.1 billion in tax dollars may be lost if the other co-ops experience the same fate. Given that the remaining co-ops had claims, on average, 26 percent greater than the income received in premiums in 2014, compared with a ratio of -19 percent for the co-ops that have failed to date, it should come as no surprise if more co-ops collapse in the future.

A Preliminary Assessment of the Cost of Health Insurance in 2016

As of November 1, open enrollment has officially begun, and with it, a lot of chatter about how the cost of health insurance has increased in 2016. When it comes to the cost of health insurance, premiums get the most attention as they are the most convenient tool for comparing and contrasting the cost of insurance from year to year. This paper aims to consider what is already known about the 2016 individual marketplace, and what it might mean for the landscape of the health insurance marketplace moving forward.

Exchange Plans Cover Limited Specialists In-Network

Exchange Plans Cover Limited Specialists In-Network

The Robert Wood Johnson Foundation recently released a report finding that 41 percent of “silver” Exchange plans had physician networks that were “small” or “extra small”. A second study examined 135 silver plans across 34 states using the federal exchange in 2015 for coverage of in-network specialists. Of the 9 specialities included, not one had 100 percent of plans offering in-network coverage to a specialist in that field, as shown below. Nearly 1 out of 5 plans were deemed “specialist-deficient” for covering fewer than six specialists in a particular field within 100 miles. People needing a rheumatologist (for arthritis, joint, or muscle pain); a psychiatrist (for mental health services); or an endocrinologist (for hormonal problems) were most likely to be without an in-network provider. These patients are then left with no choice but to use “out-of-network” providers if they are in need of those specialty services. Out-of-network care is typically significantly more expensive than in-network care. For example, one recent study found the average out-of-network billed charge for an electrocardiogram was 1,382 percent of Medicare’s fee. Additionally, payment for out-of-network care doesn’t typically count towards one’s deductible meaning health care costs for these individuals could get very expensive.

Primer: EHR Stage 3 Meaningful Use Requirements

On October 6, 2015, the Centers for Medicare and Medicaid (CMS) published its final rule on Stage 3 of the Meaningful Use Requirements for the Electronic Health Record Incentive Program.  This program adjusts payments to Medicare and Medicaid providers for implementing and “meaningfully using” (or not) interoperable electronic health records (EHR) systems. These standards are being implemented in three stages to gradually move providers toward the desired end point: to “provide efficiencies in administrative processes which support clinical effectiveness, leveraging automated patient safety checks, supporting clinical decision making, enabling wider access to health information for patients, and allowing for dynamic communication between providers.”

Primer: Introduction to the FDA Drug Approval Process and Off Label Use

The United States is home to the majority of the world’s new drug developers. With this rapidly expanding industry constantly offering Americans new health care treatments, Congress passed legislation at the turn of the 20th century to protect citizens from “quackery” and ensure the safety and effectiveness of all new pharmacological treatments. Since then the Food and Drug Administration (FDA) has expanded rapidly and become a major influence on the pharmaceutical industry.

Non-SNP Plans Receive Higher Star Ratings, on Average, than SNPs

Non-SNP Plans Receive Higher Star Ratings, on Average, than SNPs

Since 2012, Medicare Advantage (MA) and Part D plan sponsors have received payment adjustments based on their Star Ratings (determined by performance on certain criteria) in order to encourage better quality of care. Several entities have claimed that the Stars Rating Program does not appropriately account for the percentage of low-income beneficiaries enrolled in a plan. If true, this causes plans with high enrollment of such beneficiaries to consequently receive lower scores due to factors outside their control—lower socioeconomic status often makes it more likely that an individual will be sick and more difficult for that individual to adhere to a treatment plan. Plans’ 2016 Star Ratings seem to support this theory. Only 38 percent of Special Needs Plans (SNPs) received overall scores of 4 Stars or higher (necessary to receive a bonus), compared with 58 percent of Non-SNPs. Enrollment in SNPs is limited to individuals dually-eligible for Medicare and Medicaid; individuals who live in certain institutions (such as nursing homes) or require home health care; and individuals with specific chronic or disabling conditions.

Primer: Navigating the Mental Health System

The systems of mental health available in America today are incomplete, complex, and counterintuitive. Attempting to trace the paths to gaining mental health care in America is difficult, even for an individual who is not in the midst of a mental health crisis. The resulting gaps in care can cause unnecessarily tragic outcomes, yet finding ways to fill those gaps poses financial and political obstacles that will be difficult to overcome.

Primer: The Substance Abuse and Mental Health Services Administration

The Substance Abuse and Mental Health Services Administration (SAMHSA) is an agency within the Department of Health and Human Services (HHS), established in 1992 by the Alcohol, Drug Abuse and Mental Health Services Administration (ADAMHA) Reorganization Act (PL 102-321). This agency is tasked with providing prevention, treatment, and recovery support services for mentally ill individuals.

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