A conservative health and public policy think tank reports on the consequences of a federally managed pharmaceutical approval and regulatory process and how that impacts patient access to timely and appropriate care — with respect to pharma availability. The Pacific Research Institute released its white paper detailing what it describes as the bureaucratic morass of “stymied pharmaceutical regulation” within the FDA’s drug approval process. A snippet:

During a 12-month period in 2008 and 2009, the European Union’s European Medicines Authority (EMA) and the Food and Drug Administration (FDA) approved a total of 39 new medicines. Fifteen were approved only by the FDA, 11 were approved only by the EMA, and 13 were approved by both regulators.

In five of the 13 cases where the FDA and EMA both approved the medicine, the EMA was the first to approve, and it issued those approvals 552 days faster than the FDA, on average. Even if we include all 13 medicines approved by the FDA and the EMA, the EMA approved those 97 days faster, on average.

The report goes on to describe the effects on impassive procedures of the FDA and its correlation to unnecessary medical tourism for similarly approved pharmacological treatments elsewhere. Although the report confirms what we all know about the costs of healthcare respect to governmental and regulatory mechanisms, perhaps this is another area in which Obama’s pick to head another regulatory agency addresses the need to apply quality and efficiency to the rather staid and arcane process of pharma approval.

Got a gripe with your health insurer? You may be in luck. Under the new reform law, President Obama is making it easier to file appeals and have them evaluated because of a rejected claim. Prior to reform, the appeals process differed among insurers, adding to the bureaucratic “justification” for the rather phlegmatic approach to such issues in the past.

Now, consumers will appeal directly to the insurer. If they’re denied a second time, they can go to an independent reviewer whose decision is binding. Health plans must pay the cost of outside appeals, and if they’re overruled, they must cover the disputed claim in full. Consumers can also use the appeals process if their coverage gets canceled. The program will benefit almost 90M policyholders by the law’s totality in 2014. | LINK

What do you get when old-fashioned community activism meets 21st century social media tech? Perhaps the best politics-is-local example of reforming healthcare access so far after its passage on a national scale. Howard County, Md. – approx pop. 250 000 — is partnering with a tech firm with one simple goal in mind: to guarantee access to healthcare for its uninsured.

Its mechanism looks to be a harbinger for reform-based enterprises such as local healthcare exchanges/cooperatives (whether subsidized or not) within which members pay a monthly fee for basic services. These services may run the gamut of primary care — as acute hospitalizations, preventive medical treatments and screenings, and emergency medical access would be covered.

Perhaps even more important, the utilization of concierge providers as healthcare “coaches” as both an empowerment mechanism and compliance tool, ensures continued healthcare access, sound preventive care, and decreased future healthcare costs. Will it serve as a model for state-based healthcare exchanges under reform? Looks like it’s on its way. | LINK

During the preamble to the passage of the Patient Protection and Affordable Care Act, much was made of the disharmony among the political left and right, giving fodder to explosive townhalls — many of which became inescapable albatrosses around the necks of President Obama and other Democrat proponents of the now famously defunct “public option” in its purest form. In the healthcare debate’s final days, an increasing number of physicians joined in the fray to make their voices heard. Generally (if you don’t count the political institutionalism of the AMA) many physicians saw pending legislation as a positive step toward increasing healthcare access for patients who, at the very least, needed coverage.

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The U.S. Preventive Services Task Force, an independent, non-partisan body made up of primary care physicians involved in developing preventive medical guidelines based upon evidence-based medicine, has always reveled in its staunch self-governance. That could change ever so slightly in the new age of health reform.

The academic research-oriented group will continue to make recommendations on best-preventive practices and supply ratings (“A”, “B”, etc.); but this time, under reform, insurers will be required to cover services that receive such a rating. The Obama administration hopes that this increase in access (which will require a small premium increase by insurers in the near term) will reap savings in the future — as costs for preventive testing, screening for certain chronic diseases, vaccinations, and well-child visits would be covered (without health plan co-pays and deductibles) if so rated by the USPSTF.

Besides having to consider methodology involved in formulating its ultimate recommendations, the group will also have to contend with the specter of political agenda setting if lobbying groups and disease advocacy organizations have their way under this bit of legislation — scheduled to go into effect in September. | LINK

Some headlines prior to the Independence Day holiday. Normal posting resumes here at Doctor Pundit on July 6. Have a happy and safe holiday weekend!

• Veterans Admin admits to the debacle surrounding dirty dental instruments placing hundreds of patients at risk of HIV transmission. [LINK]
• Minnesota nursing strike may be averted, but time will tell if threat to strike was more of a bluff. Hospitals and nurses pledged to work within the constraints of internal governance. [LINK]
• How’s healthcare reform going? Just fine, according to some. [LINK]
• How influential will states’ insurance commissions be when regulating insurers’ medical loss ratios in the age of reform?
  

  The medical-loss ratio measures how much of premiums insurers pay out for medical care versus administrative costs. The new law requires that insurers use at least 80% of the premiums from individuals and small businesses to pay for medical care and profit-taking, and 85% of premiums from larger employers. Health insurers are waiting for regulators to clarify how companies must account for the numbers—whether they can average the MLRs of their subsidiaries, for instance.

  [LINK]

• Study: Genes key to longevity. [LINK]

President Obama’s recent remarks surrounding the commitment to Americans the promise of lower insurance premiums for healthcare access are all over the news and healthcare blogosphere this morning. The interested reader and health policy wonk also can’t avoid the latest goings on with Medicare legislation. But what about Medicaid? Obscured by concerns of healthcare providers’ battles with looming cuts to Medicare and patients’ bills of rights in their tussles with Insurance; the fears many states have with changes to Medicaid policy in lieu of reform are just as newsworthy.

A think tank’s new study sheds some light on this potentially incendiary issue: Medicaid is the prime payer of long term care (LTC) healthcare delivery in this country. Many states are concerned that Medicaid costs as a percentage of state budgets will nearly double by 2030, from the current 20 percent to 35 percent in some states. In some cases, costs can triple. LTC accounts for about a quarter of that expense. All the talk about the disappearance of patients from physicians’ Medicare rolls may be just the iceberg’s tip. Companies could be forced to jettison Medicaid beneficiaries; proposals to tax some healthcare and health plans to curb Medicaid cost increases are even on the table. As states’ problems with unemployment grow (here in MN, it’s at a ‘moderate’ 7 percent), Medicaid-related healthcare expense continues to increase in tandem. Not a rosy outlook at all. | PDF LINK

Yep, November 2010 is shaping up to be a very interesting month.  The perfect storm surrounding the complexities of providing care to the aging uninsured is about to become a tsunami. The addition of millions of patients to the rolls of Medicare, the end of the six month reprieve on the implementation of enormous cuts, and the eye-opening intention of many medical providers to shorten their Medicare beneficiary bases will all combine to create healthcare’s version of the BP oil catastrophe.

Okay, that sentiment could be a little hyperbolic, but don’t discount the lingering animosity many physicians have for the lack of any government action on the way Medicare reimbursements are generated. Sure, there may be a six-month break before the inevitable occurs, but some providers have just had enough.

“I’m making a statement,” says Leah McCormack, a New York City dermatologist. “Many physicians are really being forced out of private practice.”

While hardly representative of the entire universe of physicians who see Medicare patients (some 97 percent according to CMS), it does encapsulate the sentiment being felt as many states’ medical societies as they report significant numbers of physician opt-outs. On the flip side, realistically, how many physicians can actually afford to leave Medicare — either via a moral stance or one out of necessity? Hopefully, patients will not have to find out. Healthcare access is an important part of President Obama’s reform agenda. The little-known (until now) inner workings of Medicare legislation will be taking front-and-center positions, as this latest wrinkle in healthcare reform gains more momentum for definitive action. And this time, the physicians are taking notice. | LINK

No sooner had the Senate’s stonewalling led to the expectation of the approval of deep cuts to Medicare reimbursements to physicians, a reversal of fortunes now has both Dems and the GOP agreeing on the so-called “doc-fix” compromise for which Finance chair Max Baucus has been advocating.

The $6.4 billion measure would reverse a 21 percent cut in physician payments that was to kick in Friday, raising the possibility that some doctors might begin to turn away those covered by Medicare.

To the GOP, this action means implementing yet another interim budget-neutral respite on the road toward Medicare payment . To the Democrats, it means saving face among healthcare reform advocates for another six months — just in time for the midterms. | LINK

An exclusive to Doctor Pundit, by Laura Katz Olson, PhD

Medicaid, a core component of the recently enacted Patient Protection and Affordable Care Act, will now cover all low-income individuals, regardless of age or family status, with incomes up to 133 percent of the Federal Poverty Level. However, I would argue that Medicaid is not the best way to advance universal insurance coverage. The program is firmly anchored in the states, whose glaring inability to lead the way is most evident in their fiscal constraints: during difficult financial times, such as now, unemployment, the number of uninsured households and Medicaid caseloads all rise, just when the states confront declines in their revenues. For example, average enrollments in 2009 increased by 5.4% and spending by 7.9% but revenues were down by 7.5%. Consequently, many localities have eliminated or reduced certain benefits (including dental care, hearing aids, glasses, rehabilitation services) and decreased provider fees (leading to less access to doctors, especially specialists). Even in “better” times, Medicaid is a source of continuing financial strain.

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If anyone needs any proof of how irrelevant the American Medical Association has become in its advocacy of the physicians the organization is supposed to represent, one needs look no further than in the last minute unexpected rejection of the postponing of cuts (21%) to Medicare reimbursement schedules. So much for being in the physicians’ corner on this issue. Senate Republicans essentially killed the measure via a vote along party lines. Initially, there was hope for a compromise fashioned at the eleventh hour by Max Baucus (D-MT) — one of the key figures in the establishment of many of the provisions set forth in the reform bill’s passage earlier this year.

The Senate had rejected a Finance Committee compromise^[1] that would have delayed the cut in Medicare payments to physicians until 2012, along with measures to extend unemployment benefits and provide $24 billion to states to cope with their Medicaid programs. Senate Republicans have apparently had enough — as CMS now has the greenlight to move forward on the cuts which were to have initially been implemented on June 1. This entire episode is a reminder of how serious matters are for primary care to sustain itself in a slowly recovering economy and increasingly prudent healthcare marketplace — which now, in a new reform-minded environment, has to manage to do more with less. The calling for innovation for the recruitment of primary care physicians has never been greater this century than as a result of this moment.

1. The compromise would have decreased the total cost to $118 billion and the overall deficit impact by some $20B;  it would have delayed the planned Medicare cuts and provided a 2% raise for physicians through November 30, rather than for the 19 months as part of the original bill. Essentially, the compromise would have amounted to a short term “fix” of the SGR — the method by which the cuts are computed in the face of increasing healthcare expenses by the government. [↩]

It apparently takes a financial stimulus of a different kind to jump start states into an investigative mood. Just days after the announcement of the availability of funds^[1] for oversight of insurance rate hikes by the feds for states’ use, Pennsylvania’s governor announces the scrutiny of nine insurers there.

The insurance rate review process is milking opportunity in the window prior to the reform law’s provision to make underwriting as a mechanism for premium rate setting illegal as it pertains to medical history (existence of prohibitive pre-existing conditions). In 2014, once the law makes this provision ironclad, insurers will have to resort to other mechanisms to underwrite policy terms — such as community-based ratings. As things stand right now, small insurers in very competitive markets are keen to medical history underwriting to gain share over major players — such as the regional Blues —  which employ tested methods in markets where patient demographics encourage fiscally advantageous claims patterns. | LINK

1. Health & Human Services Secretary Kathleen Sebelius on 6/7/10 announced the availability of $51 million in grants for states to create and strengthen the insurance rate review process. [↩]

HHS Secretary Sebelius is warning insurers’ Medicare Advantage contracts not to increase premium rates for their beneficiaries. This is ahead of insurers’ submissions of plans to the feds yesterday. The memo also comes on the heels of many Congressional Democrats asking the government to evaluate thoroughly the cost of those plans.

The issue of overpayments to insurers by the government is of prime concern to Sebelius and the White House. But, not according to the AHIP — which is lobbying for increased rates at which the feds pay them. The AHIP says that stagnant rate schedules from 2010-2011 and pending cuts to the insurers who contract with CMS based upon the new reform law essentially forces them to push for greater payments. It’s a classic let-the-market-run-itself scenario versus the continued fleecing of the largest subsidized healthcare coverage program in the country; and there are probably elements of both at play at any given time. | LINK