The federal government has given opponents of the ACA another reason to gripe: it has announced the formation of loans to initiate health plans on the new exchange platform in individual states. Think of the offering has a cooperative of sorts, built for the delivery of services within an exchange. CMS intends to oversee the adoption of at least one co-op per state via this method. Of course, emergency stopgaps are in place for the recipients of loans that may have problems satisfying the terms set forth by the feds; interest rates will be typically less than 1 percent.
Naturally, the behavior of such a healthcare delivery system is a reflection of the acronym used by the ACA’s program promoting it: the Consumer Operated and Oriented Plan. Proponents of the initiative are bullish on it, as the GOP-led legislature has incrementally cut initial CMS plan estimates earmarked for this purpose. Skeptics wonder if these loan startups will carry the heft needed to compete with established private insurers in the newly formed exchange marketplace in two years. The best intentions of non-profits in this case will have to be tempered by the new reality of such competition for healthcare consumer loyalty come 2014 under the law. Should be interesting to watch. | LINK
The cornerstone of the ACA is the provision for a coverage mandate — whether that coverage includes complete subsidized services (Medicaid or another fed subsidized program) or via private insurer. In order that individual states comply with this most essential of the reform law’s benefits, HHS has announced that states have the option to create “essential benefits packages” as a method of increasing compliance within the ACA.
“Flexebility” is the key, according to Secretary Kathleen Sebelius.
The national health law lists 10 categories of health care that all insurance policies must cover: hospitalization, emergency care, out-patient services, maternity and newborn care, mental health and substance abuse services, prescription drugs, laboratory testing, preventive and wellness care, pediatric services (including dental and vision examinations), rehabilitative care and habilitative care such as services for children with developmental disabilities. But within those categories, the federal government is allowing each state to determine its own basket of essential benefits by choosing a “benchmark” package offered by any of a variety of insurers.
Sebelius: This move protects consumers by respecting states’ role in healthcare delivery under the ACA. Obama administration: This is the only way in which the mandate can be upheld while making essential services affordable in all fifty states. Consumers? Increased standardization among offerings of basic services by states under the ACA raises the possiblity of mandated coverage rather than making things too onerous for the feds in getting the legislation off the ground in just a couple of years. | LINK
Are the citizens of Minnesota ready to take a look at prototype models for healthcare exchanges? The marketplace stimuli as part of reform are being unveiled today. Although it may seem early for such exposure, MN must demonstrate that it can operate an exchange as part of reform much sooner — just over a year from now, in fact. Four companies have placed demo modules up for public review. Playing around with a couple of them, I get the feel of sites that are actually consumer portals into products that resemble reservation services, only instead of purchasing a flight or hotel accomodations, I am choosing a provider which can treat certain chronic conditions more cheaply, for instance, in one organization in comparison another based upon my personal situation.
States participating in this exercise which are not able to fully integrate these virtual exchanges at the outset of reform will get fed assists. Minnesota seems ahead of the curve here, as the governor has taken a seemingly personal role in getting this state’s offerings public and implementing diligent task-force support to the process early.
As a follow-up to a DP post on the unusual strategy pharma company Pfizer is implementing in trying to protect market share for the formerly solely branded drug Lipitor, here’s another take on the issue. According to one analyst profiled, Pfizer faces an uphill battle in trying to convince the pharma marketplace that its branded agent is more clinically efficacious than generic atorvastatin.
Pfizer is doing a so-so job of convincing health plans and [pharma benefit managers] that Lipitor is somehow better than a generic. On a scale of 1 to 10, Pfizer received a 4. Nonetheless, 54.8 percent say they will offer the authorized generic, which is being sold by Watson Pharmaceuticals. Meanwhile, only 30.4 percent report they will receive added rebates or discounts from Pfizer.
Of course, the pharma company stands to lose a ton during its loss of exclusivity over the next 6 months, but it will remain tenacious — as many analysts do not believe future antitrust issues will occur. Perhaps even more interesting is the new ground being broken here: can healthcare consumers be weaned off of generics and stay loyal to branded medications — if insurers and key third parties allow them to gain incentives by continuing to utilize them? | LINK
Medicare will now expand its breadth of covered preventive services to include obesity treatment and management. In what could be a sign of the increasing population of beneficiaries who were weaned in the Boomer mentality, treatment coverage for such a hot-button topic among politicians, lobbyists, healthcare advocates, and physicians themselves — will remain, indeed, controversial. According to CMS, obese Medicare beneficiaries (defined as those with a body mass index of 30 or higher) may see their primary care physician for one face-to-face visit every week for the first month. Then, Medicare will pay for one face-to-face visit every other week for the next five months. If the patient loses at least 3 kg (6.6 lbs.) over the first six months, Medicare will pay for an additional six months of once-a-month face-to-face visits with the doctor.
Insurance remains above the fray here. While the feds may explain away this coverage as putting a dent in future healthcare costs associated with the obese patient, the fact remains, that outside of a universally defined pragmatic treatment regimen (ie, dedicated drugs = dedicated reimbursements/payments) — provider acceptance of this latest move by CMS will continue to advance at a trickle. It’s hard to get on board with yet another taxpayer funded government initiative whose intentions really haven’t been proven to lower across-the-board healthcare costs, lower all-cause mortality, and assume that all physicians are competent weight-loss counselors. Also: about 30 percent of beneficiaries are projected to qualify for this latest Medicare preventive care benefit. | LINK
Twenty-eleven and 2012 are going to be remembered in the near term as very profitable periods of the generic manufacture of many formerly branded mega-sellers. Of course, the agent getting the most media ink this week is atorvastatin (Lipitor), the ubiquitous cholesterol lowering pill whose miraculous ways even prompted a short-lived lobby to go OTC.
The pharma company Pfizer, it could be reasoned, would still have some skin in the game in spite of generic availability. Specifically, partnerships with pharma benefit managers and insurers would still give the company a stake in orgs that would inhibit generic availability by offering rebates and discounts of branded Lipitor. It is the potential for actions like this which gets the attention of legislators (specifically Democrats) who want fair competition — as opposed to stymied innovations in generic marketing from pocketed profits by PBMs and insurance companies.
Detailed in an NYT piece last month, the prospect for limited availability of generics — specifically for Medicare Part D beneficiaries is a sobering one. Pfizer claims cost equivalencies (with respect to lower co-pays on branded Lipitor) for beneficiaries if the pharma company is able to offer those discounts to third parties. It is an interesting development in what is usually an uneventful and mundane process.
Political coalitions here in Minnesota have largely towed the Democratic line, having gone decidedly blue in the last presidential election in spite of reports that the state was a purple one “in play” in an ultimate result that was anything but close. The building within the democratic base also stands to reap benefits with respect to the reform law by its inception in 2014.
This, according to an MIT healthcare economist.
[Jonathon Gruber] told members of a governor’s task force Thursday that the federal health care law will reduce the health insurance racial disparities in Minnesota. [...] Gruber projects that almost 300,000 additional Minnesota residents would gain insurance coverage by 2016, and that those who currently buy health insurance on the individual market could pay 20 percent less in premiums after taxes.
Gruber was speaking in terms of the savings generated by increased access to healthcare with the advent of exchanges under reform. Dem Governor Mark Dayton has recently formed a couple of healthcare task forces — one of which will exclusively work to develop an exchange to increase access to the state’s un- and under-insured. | LINK
Could retail be the solution to comprehensive healthcare delivery? Well, if big-box retailer Walmart has anything to say about it — then, bring it on! Stretching the idea of retail minute clinics to extremely absurd heights, the retailer wants to partner with other entities to increase care access ahead of the tsunami of increased coverage sure to occur once reform kicks in a couple of years from now. It lays out its plans in a 14-page Request for Information [PDF].
In-store medical clinics, such as those offered by Walmart and other retailers, could also be players in another effort in the health law: encouraging collaborations of doctors and hospitals who want to win financial rewards for streamlining care and lowering costs. Such collaborations, known as “accountable care organizations,” might contract with in-store medical clinics, says Paul Howard, a senior fellow with the Manhattan Institute for Policy Research.
The other entities, sometimes labeled as “vendors” in Walmart’s RFI, appear to be (healthcare) organizations which have the potential to collaborate on best practices for many chronic conditions — enabling the partner vendor to benefit in terms of quality, accountability, delivery of healthcare services in order to maximize their bottom lines.
This mode of healthcare delivery raises concerns, to be sure. Could we be seeing an entirely new way of the delivery of healthcare as a pure commodity to be negotiated and priced like any other product? Will it encourage other major national retailers to follow suit? What will this do to the traditional model of healthcare organizational delivery of primary care? Will it enhance it? Will it make it more accountable to third parties? How will this model benefit insurance companies’ approach to premiums in an altered delivery marketplace? Quite an interesting development in the ongoing saga of the cost of healthcare in this country. | LINK
A physician advocacy group has released a report detailing the costs to Massachusetts in the wake of its healthcare reform. The goal is to shed light on the potential costs to the country as a whole once reform begins in earnest. The single-payer advocacy group mainly cites that cost shifting of taxpayer subsidies to fund the private insurance marketplace is creating an access burden for the state’s impoverished and lower middle class by pricing them out.
Most of the gains in coverage have come from expansions in publicly subsidized insurance. This largely represented a shift of patients from the state’s former Free Care Pool, which compensated hospitals and community health centers directly for care of the uninsured, to private insurance plans, which is a more costly way to provide care.
Read the PDF of the entire report. The report appears to yearn for a less-than-market-based approach to solving this financial crisis as a way in which access to care can remain intact amid long-term reform sustainability. This report was released jointly among this group and via the state chapter of Physicians For a National Health Program.
Originating from Saint Paul, Minnesota, [doctorpundit.com] is a weblog about the policy of healthcare and where it intersects with politics and public opinion; it is edited by Michael Douglas, MD, MBA. Welcome, and please consider my take on what is Healthcare 2.0, complemented by a few of my thoughts on my personal avocations and guilty pleasures: music, prose, and writing. Follow Doctor Pundit via RSS above.
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DOCTOR PUNDIT @ ONE YEAR | An occasional DP series from 2010 highlighting healthcare policy trends over the period from 2009-2010 in a compare/contrast format.
