Saturday, January 19, 2019

Health Care Reform Articles - January 19, 2019

The Insulin Wars

by Danielle Ofri - NYT - January 18, 2019

“Doctor, could you please redo my insulin prescription? The one you gave me is wrong.” My patient’s frustration was obvious over the phone. She was standing at the pharmacy, unable to get her diabetes medication.
We had gone through this just the week before. I’d prescribed her the insulin she’d been on, at the correct dosage, but when she showed up at her pharmacy she learned that her insurance company no longer covered that brand. After a series of phone messages back and forth, I’d redone the prescription with what I’d thought was the correct insulin, but I was apparently wrong. Again.
Between 2002 and 2013, prices tripled for some insulins. Many cost around $300 a vial, without any viable generic alternative. Most patients use two or three vials a month, but others need the equivalent of four. Self-rationing has become common as patients struggle to keep up. In the short term, fluctuating blood sugar levels can lead to confusion, dehydration, coma, even death. In the long term, poorly controlled diabetes is associated with heart attacks, strokes, blindness, amputation and the need for dialysis.
The exorbitant prices confound patients and doctors alike since insulin is nearly a century old now. The pricing is all the more infuriating when one considers that the discoverers of insulin sold the patent for $1 each to ensure that the medication would be affordable. Today the three main manufacturers of insulin are facing a lawsuit accusing them of deceptive pricing schemes, but it could be years before this yields any changes.
There are several reasons that insulin is so expensive. It is a biologic drug, meaning that it’s produced in living cells, which is a difficult manufacturing process. The bigger issue, however, is that companies tweak their formulations so they can get new patents, instead of working to create cheaper generic versions. This keeps insulin firmly in brand-name territory, with prices to match.
But the real ignominy (and the meat of the lawsuit) is the dealings between the drug manufacturers and the insurance companies. Insurers use pharmacy benefit managers, called P.B.M.s, to negotiate prices with manufacturers. Insurance programs represent huge markets, so manufacturers compete to offer good deals. How to offer a good deal? Jack up the list price, and then offer the P.B.M.s a “discount.”
This pricing is, of course, hidden from most patients, except those without insurance, who have to pay full freight. Patients with insurance live with the repercussions of constantly changing coverage as P.B.M.s chase better discounts from different manufacturers.
All insurance companies periodically change which medications they cover, but insulin is in a whirlwind class by itself because of the staggering sums of money involved. “Short-acting” is supposed to be a category of insulin, but now it appears to be its category of insurance coverage. My patient’s “preferred insulin” changed three times in a year, so each time she went to the pharmacy, her prescription was rejected.
On the doctor's end, it’s an endless game of catch-up. Lantus was covered, but now it’s Basaglar: rewrite all the prescriptions for all your patients. Oops, now it’s Levemir: rewrite them all again. NovoLog was covered, then it was Humalog, but now it’s Admelog. If it’s Tuesday, it must be Tresiba.
It’s a colossal time-waster, as patients, pharmacists and doctors log hours upon hours calling, faxing, texting and emailing to keep up with whichever insulin is trending. It’s also dangerous, as patients can end up without a critical medication for days, sometimes weeks, waiting for these bureaucratic kinks to get ironed out.
Lost in this communal migraine is that this whole process is corrosive to the doctor-patient relationship. I knew that my patient wasn’t angry at me personally, but her ire came readily through the phone. No doubt this reflected desperation — she’d run out of insulin before and didn’t want to end in the emergency room on IV fluids, as she had the last time. Frankly, I was pretty peeved myself. By this point I’d already written enough insulin prescriptions on her account to fill a sixth Book of Moses. I’d already called her insurance company and gotten tangled in phone trees of biblical proportions.
This time I called her pharmacy. A sympathetic pharmacist was willing to work with me, and I stayed on the phone with her as we painstakingly submitted one insulin prescription after another. The first wasn’t covered. The second wasn’t covered. The third was. But before we could sing the requisite hosannas, the pharmacist informed me that while the insulin was indeed covered, it was not a “preferred” medication. That meant there was a $72-per-month co-payment, something that my patient would struggle to afford on her fixed income.
“So just tell me which is the preferred insulin,” I told the pharmacist briskly.
There was a pause before she replied. “There isn’t one.”
This was a new low — an insurance company now had no insulins on its top tier. Breaking the news to my patient was devastating. We had a painful conversation about how she would have to reconfigure her life in order to afford this critical medication.
It suddenly struck me that insurance companies and drug manufacturers had come upon an ingenious business plan: They could farm out their dirty work to the doctors and the patients. Let the doctors be the ones to navigate the bureaucratic hoops and then deliver the disappointing news to our patients. Let patients be the ones to figure out how to ration their medications or do without.
Congress and the Food and Drug Administration need to tame the Wild West of drug pricing. When there’s an E. coli outbreak that causes illness and death, we rightly expect our regulatory bodies to step in. The outbreak of insulin greed is no different.
It is hard to know where to direct my rage. Should I be furious at the drug manufacturers that refuse to develop generics? Should I be angry at the P.B.M.s and insurance companies that juggle prices and formularies to maximize profits, passing along huge co-payments if they don’t get a good enough deal? Should I be indignant at our elected officials who seem content to let our health care system be run by for-profit entities that will always put money before patients?
The answer is all of the above. But what’s most enraging is that drug manufacturers, P.B.M.s and insurance companies don’t have to pick up the pieces from the real-world consequences of their policies. That falls to the patients.

The Strange Marketplace for Diabetes Test Strips

by Ted Alcorn - NYT - January 14, 2019

On most afternoons, people arrive from across New York City with backpacks and plastic bags filled with boxes of small plastic strips, forming a line on the sidewalk outside a Harlem storefront.
Hanging from the awning, a banner reads: “Get cash with your extra diabetic test strips.”
Each strip is a laminate of plastic and chemicals little bigger than a fingernail, a single-use diagnostic test for measuring blood sugar. More than 30 million Americans have Type 1 and Type 2 diabetes, and most use several test strips daily to monitor their condition.
But at this store on W. 116th Street, each strip is also a lucrative commodity, part of an informal economy in unused strips nationwide. Often the sellers are insured and paid little out of pocket for the strips; the buyers may be underinsured or uninsured, and unable to pay retail prices, which can run well over $100 for a box of 100 strips.
Some clinicians are surprised to learn of this vast resale market, but it has existed for decades, an unusual example of the vagaries of American health care. Unlike the resale of prescription drugs, which is prohibited by law, it is generally legal to resell unused test strips.
And this store is far from the only place buying. Mobile phones light up with robo-texts: “We buy diabetic test strips!” Online, scores of companies thrive with names like and
“I’m taking advantage, as are my peers, of a loophole,” said the owner of one popular site, who asked that his name not be used. “We’re allowed to do that. I don’t even think we should be, frankly.”
Test strips were first developed in 1965 to provide an immediate reading of blood sugar, or glucose, levels. The user pricks a finger, places a drop of blood on the strip, and inserts it into a meter that provides a reading.
The test strips were created for use in doctors’ offices, but by 1980 medical-device manufacturers had designed meters for home use. They became the standard of care for many people with diabetes, who test their blood as often as ten times a day.
Test strips are a multi-billion-dollar industry. A 2012 study found that among insulin-dependent patients who monitor their blood sugar, strips accounted for nearly one-quarter of pharmacy costs. Today, four manufacturers account for half of global sales.
In a retail pharmacy, name-brand strips command high prices. But like most goods and services in American health care, that number doesn’t reflect what most people pay.
The sticker price is the result of behind-the-scenes negotiations between the strips’ manufacturer and insurers. Manufacturers set a high list price and then negotiate to become an insurer’s preferred supplier by offering a hefty rebate.
These transactions are invisible to the insured consumer, who might cover a copay, at most. But the arrangement leaves the uninsured — those least able to pay — paying sky-high sticker prices out of pocket. Also left out are the underinsured, who may need to first satisfy a high deductible.
For a patient testing their blood many times a day, paying for strips out-of-pocket could add up to thousands of dollars a year. Small wonder, then, that a gray market thrives. The middlemen buy extras from people who obtained strips through insurance, at little cost to themselves, and then resell to the less fortunate.
That was the opportunity that caught Chad Langley’s eye. He and his twin brother launched the website to solicit test strips from the public for resale. Today they buy strips from roughly 8,000 people; their third-floor office in Redding, Mass., receives around 100 deliveries a day.
The amount the Langleys pay depends on the brand, expiration date and condition, but the profit margins are reliably high. For example, the brothers will pay $35 plus shipping for a 100-count box of the popular brand Freestyle Lite in mint condition.
The Langleys sell the box for $60. CVS, by contrast, retails the strips for $164.
The Langleys are mainly buying up excess strips from insured patients who have been flooded with them, sometimes even when not medically necessary.
Although patients who manage their diabetes with non-insulin medications or with diet and exercise needn’t test their blood sugar daily, a recent analysis of insurance claims found that nearly one in seven patients still used test strips regularly.

Gretchen Obrist

The market glut is also a consequence of a strategy adopted by manufacturers to sell patients proprietary meters designed to read only their brand of strips. If a patient’s insurer shifts her to a new brand, she must get a new meter, often leaving behind a supply of useless strips.
While some resellers use websites like Amazon or eBay to market strips directly to consumers, the biggest profits are in returning them to retail pharmacies, which sell them as new and bill the customer’s insurance the full price.
The insurer reimburses the pharmacy the retail price and then demands a partial rebate from the manufacturer — but it’s a rebate the manufacturer has paid already for this box of strips.
Glenn Johnson, general manager for market access at Abbott Diabetes Care, which makes about one in five strips purchased in the United States, said manufacturers lose more than $100 million in profits a year this way, much of it in New York, California and Florida.
The company supported a new California law that prohibits pharmacies from acquiring test strips from any but an authorized list of distributors. Mr. Johnson said he has spoken with lawmakers about similar efforts in Florida, New Jersey, New York and Ohio.
Such measures leave intact the inflated retail prices that make the gray market possible and which critics say benefit manufacturers and their retail intermediaries, pharmacy benefit managers.
In a lawsuit against P.B.M.’s and the dominant test strip manufacturers filed in New Jersey, consumer advocates presented data showing that the average wholesale price for test strips has risen as much as 70 percent over the last decade.
They alleged that this has allowed the defendants to pocket an unfair portion of the rebates. The price of a strip would be much lower if it wasn’t fattened by profiteering, said Gretchen Obrist, one of the lawyers who brought the case.
“It’s a tiny little piece of plastic that’s super cheap to manufacture, and they’ve managed to make a cash cow out of it,” she said.
To justify the rising price of strips, manufacturers point to advances in engineering that have made the strips smaller and more convenient to use. But there is little evidence those features have improved health outcomes for people with diabetes — and with increasingly unaffordable prices, the newfangled test strips may be even less accessible.
The markups on strips look particularly stark when compared to the cost of producing them.
“Test strips are basically printed, like in a printing press,” said David Kliff, who publishes a newsletter on diabetes. “It’s not brain surgery.”
He estimated the typical test strip costs less than a dime to make.


Seven in 10 Maintain Negative View of U.S. Healthcare System

by Justin McCarthy - Gallup - January 14, 2019


  • 70% say U.S. healthcare has major problems/is in state of crisis
  • Overall perceptions stable, but party views have changed
  • About six in seven Democrats now have negative assessments of the system
WASHINGTON, D.C. -- Seventy percent of Americans describe the current U.S. healthcare system as being "in a state of crisis" or having "major problems." This is consistent with the 65% to 73% range for this figure in all but one poll since Gallup first asked the question in 1994.

In that one poll -- conducted right after the 9/11 attacks in 2001 -- just 49% of Americans said the U.S. healthcare system had major problems or was in crisis. This was because of Americans' heightened concerns about terrorism after the attacks, which temporarily altered their views and behaviors on a variety of issues.
The latest data are from Gallup's annual Healthcare poll, conducted Nov. 1-11.

About Six in Seven Democrats Rate the Healthcare System Negatively

Although the percentage of Americans saying U.S. healthcare has major problems or is in crisis has been fairly flat over the past two decades, Democrats' and Republicans' views have changed within that time frame.
Line graph. Partisans’ ratings since 2001 of the U.S. healthcare system as having major problems or being in crisis.
From 2001 to 2009, Democrats and Democratic-leaning independents were considerably more likely than Republicans and Republican-leaning independents to say healthcare had major problems or was in crisis. Democrats' negative assessments then decreased in the rest of President Barack Obama's first term, after passage of the Affordable Care Act (ACA) in 2010, at the same time that Republicans' concerns mounted. By 2012, the lines crossed, so that during most of Obama's second term, Republicans were significantly more likely than Democrats to perceive significant or critical problems in the healthcare system.
Now, with Republican President Donald Trump in office, partisan views have flipped again, with Democrats more likely to be concerned.
The difference between the two major parties on this measure was just five percentage points in 2017, Trump's first year, when 76% of Democrats and 71% of Republicans said healthcare had major problems or was in crisis. This expanded to a 28-point gap in 2018, when 84% of Democrats and 56% of Republicans expressed these views -- the largest partisan gap on this measure in Gallup's trend since 2001.
The 2018 poll was conducted on the heels of last year's midterm elections, in which Democratic candidates highlighted key problems with the healthcare system -- especially coverage.
Although most Americans, including majorities of Republicans and Democrats, give the healthcare system a pessimistic diagnosis, when asked specifically about the quality of U.S. healthcare, 55% rate it positively. Smaller percentages have positive reviews of U.S. healthcare coverage (34%) and costs (20%). Americans rate cost and access as the greatest health problems facing the country.
More broadly, Gallup has found that Americans are much more positive in their assessments of their personal healthcare than they are about the healthcare system nationally.

Bottom Line

Barring any major breakthroughs in healthcare reform, it's difficult to imagine Americans' dim assessments of the state of U.S. healthcare changing anytime soon, given the mostly stable trend Gallup has recorded over nearly a quarter of a century.
The last major feat in healthcare policy reform was met by more disapproval than approval from Americans for many years, and the public's preferences for next steps on the ACA provide an unclear path for policymakers to follow to improve perceptions of the system.
Democratic efforts in the House of Representatives to protect the ACA will likely hit roadblocks with a GOP-controlled Senate and White House, and even some Democratic approaches to lowering drug prices are unlikely to receive Republicans' support. 2018 GOP congressional candidates campaigned on protection for those with pre-existing conditions, which more than a quarter of Americans report having, but there is already disagreement between the two major parties on how to provide that.
View complete question responses and trends. 

Report raises alarm about physician burnout - The Boston Globe

By Priyanka Dayal McCluskey - The Boston Glober - January 17, 2019

Physician burnout has reached alarming levels and now amounts to a public health crisis that threatens to undermine the doctor-patient relationship and the delivery of health care nationwide, according to a report from Massachusetts doctors to be released Thursday.
The report — from the Massachusetts Medical Society, the Massachusetts Health & Hospital Association, and the Harvard T.H. Chan School of Public Health — portrays a profession struggling with the unyielding demands of electronic health record systems and ever-growing regulatory burdens.
It urges hospitals and medical practices to take immediate action by putting senior executives in charge of physician well-being and by giving doctors better access to mental health services. The report also calls for significant changes to make health record systems more user-friendly.
While burnout has long been a worry in the profession, the report reflects a newer phenomenon — the draining documentation and data entry now required of doctors. Today’s electronic record systems are so complex that a simple task, such as ordering a prescription, can take many clicks.
Doctors typically spend two hours on computer work for every hour they spend with patients, the report said. Much of this happens after they leave the office; they call it “pajama time.”
Medicine has become more regulated and complex over the past several years, generating what doctors often consider to be meaningless busywork detached from direct patient care. That’s when they start to feel disheartened, authors of the report said.
“A lot of physicians feel they are on a treadmill, on a conveyor belt,” said Dr. Alain A. Chaoui, president of the Massachusetts Medical Society and a family doctor in Peabody. “They’re not afraid of work — it’s the work that has nothing to do with the patients that makes physicians unhappy. And it makes the patients unhappy, because they feel the system is failing them.”
Chaoui and the report’s other authors reviewed dozens of studies to develop their paper, which they described as “a call to action” for providers, insurers, government agencies, and health technology companies. The report does not specifically address burnout of nurses or other health care workers — only doctors.
Surveys indicate that 50 percent to as many as 78 percent of doctors have at some point experienced burnout — described as emotional exhaustion and disengagement from their work — as they contend with the realities of modern medicine.
Doctors must comply with a host of federal reporting requirements and insurance company rules. As insurers set tighter restrictions aimed at controlling costs, for example, doctors spend more time on the phone to persuade insurers to reimburse them for certain tests and services, they say.
And much of the day is spent typing, pointing, and clicking in electronic health records, which are notoriously time-consuming and difficult to use. While doctors acknowledge that electronic records hold many advantages over paper charts, they say computers have become an obstacle — literally — that can hinder conversation with patients.
Studies show that burnout has costly consequences for doctors as well as patients, and for the health care system as a whole.
When doctors are less engaged, patients are less satisfied. Burned-out physicians are more likely to make mistakes. They’re also more likely to reduce their hours or retire early. This affects their employer’s bottom line: Each departing doctor costs as much as $500,000 to $1 million to replace, according to one study.
In a national survey of doctors published last year, 10.5 percent reported a major medical error in the prior three months. Those who reported errors were more likely to experience burnout, fatigue, and suicidal thoughts.
To tackle the problem, the report says, physicians need access to mental health care without stigma or fear of losing their right to practice. The authors argue that state licensing boards should not ask probing questions about a physician’s mental health but focus instead on his or her ability to practice medicine safely.
“We want to normalize it. We want to encourage people to ask for help when they need it,” said Dr. Steven Defossez, vice president of clinical integration at the Massachusetts Health & Hospital Association. “There is certainly a fear that keeps people from accessing services today.”
Asking doctors to manage their feelings on their own is not enough, the report says; it demands that major health care organizations take burnout seriously by hiring a chief wellness officer — a senior executive in charge of tracking burnout and helping to improve physician wellness.
“This is not about more yoga classes in the hospital,” said Dr. Ashish K. Jha, a Harvard professor who worked on the report. “This is about someone at the highest level of the organization who is responsible for making sure that the workforce is healthy and thriving.”
“We think the responsibility lies with the system that has created these problems,” not with individual doctors, Jha added.
In response to the burnout “epidemic,” officials at Stanford Medicine in California hired Dr. Tait Shanafelt from the Mayo Clinic as their first chief wellness officer in 2017. Stanford also trains doctors from around the country in physician wellness.
Shanafelt said his job is to identify “problem areas” and develop a coordinated approach to address the problems.
“Part of our role is, when other key strategies or initiatives are being discussed, [to think about] the concept of how they’re going to impact our people,” he said.
Physician burnout has spawned numerous studies that have raised awareness of the issue in recent years, and several Massachusetts health systems have begun working to address it. Last January, Boston Medical Center named Dr. Susannah Rowe, an ophthalmologist, to the new role of associate chief medical officer for wellness and professional vitality. Hospital officials said they are working on initiatives to reduce administrative burdens for doctors and implement flexible work schedules.
Brigham and Women’s Hospital asked its physicians how they felt about their work in 2017 and plans to repeat the survey this year, though it has not published the results.
“We’re really in this to make our physicians professionally fulfilled — not just stop burnout,” said Dr. Jessica C. Dudley, chief medical officer of the Brigham and Women’s Physicians Organization.
Based on physicians’ feedback, the Brigham decided to provide individualized training on the hospital’s complicated health record software. The training was held at the clinics where doctors practice, Dudley said.
Thursday’s report from the medical society, hospital association, and Harvard also urges medical software companies to design more efficient systems, including by developing apps that doctors can download to help with certain tasks, such as documenting patient visits.
The report concludes with a warning: “If left unaddressed, the worsening crisis threatens to undermine the very provision of care, as well as eroding the mental health of physicians across the country.”

Doctor burnout is real. And it’s dangerous

by Alan Chaoui, Steven Defossez and Michelle Williams - Boston Globe - January 17, 2019

Burnout — a condition characterized by emotional exhaustion, cynicism, and feelings of reduced effectiveness in the workforce — impacts all caregivers and, in particular, threatens to undermine the physician workforce, endangering our health care system.
So profound it has been described as “moral injury,” burnout results from a collision of norms between the physician’s mission to provide care and increasing bureaucratic demands of a new era.
Evidence shows the worsening scope, severity, and impact of this public health crisis: Frustrating computer interfaces have crowded out engagement with patients, extending already long work days as physicians and all caregivers struggle to keep up with a soaring burden of administrative tasks. Nearly half of all physicians experience burnout in some form, and the number will continue to grow. The consequences of this epidemic on patients and physicians are clear, and physicians have affirmed a necessary and unwavering commitment to spearhead changes that will lead to solutions.
Burned-out physicians who choose not to leave the profession are more likely to reduce their work hours. This reduction is already equivalent to losing the graduates of seven medical schools every year. Recruiting and replacing one physician can cost employers as much as $1 million. Burned-out physicians are also unable to provide the best care, with evidence suggesting that burnout is associated with increased medical errors. 
We cannot improve patient experience and population health while reducing health care costs without a strong and engaged physician workforce.
What can we do? A lot. A new white paper produced by the Harvard T.H. Chan School of Public Health, the Harvard Global Health Institute, the Massachusetts Health and Hospital Association, and the Massachusetts Medical Society, proposes three key recommendations.
First, we must support proactive and confidential mental health treatment for burned-out physicians and expand outreach, particularly for trainees, who are at a vulnerable stage of their careers. Physicians seeking care face stigma and professional obstacles, including probing questions about mental health in their medical license process. We recommend such questions be limited or eliminated. If they are included, these questions should focus on impairments impacting the physician’s current practice and competence, in the same way questions about physical health do.
Second, we must improve the usability of electronic health records, or EHRs. Physicians must now spend much of an appointment clicking and typing, eyes glued to a computer monitor rather than engaged with the patient. The ever-increasing array of reporting systems and unhelpful alerts not only interfere with patient interaction, but also force physicians to spend additional hours completing administrative tasks that limit patient interaction and can harm patient experience and care.
Fortunately, there are opportunities for improvements that involve more user-friendly mobile apps. We are also seeing the first results of a drive to make it easier for EHRs from one office or hospital to share critical patient information with another system (interoperability). Further, there is technical innovation under development around streamlining some of the most burdensome, time-consuming, and demoralizing processes for obtaining insurance company approvals for services and patient referrals.
Improvements by EHR vendors and payers will require action by state and federal agencies. The US Department of Health and Human Services recently acknowledged that the burden of EHRs contributes to burnout, in its draft “Strategy on Reducing Regulatory and Administrative Burden Relating to the Use of Health IT and EHRs.” We encourage physicians and health care organizations to submit comments on how to make sure EHRs support both patient care and physician workflow.
Third, and most important for the long term, we call for the appointment of executive-level chief wellness officers at every major health care organization. Several major organizations, including Stanford Medicine and Kaiser Permanente, have already done so, recognizing that burnout among physicians and clinical and support staff across every layer of their organization demands action. This is a welcome and necessary development and must be the first step in creating a professional learning community of health care leaders and providers sharing successful burnout remediation strategies. Over time, physician and clinician wellness among all health care providers must become a “dashboard” item for institutional CEOs and boards of directors. We believe strongly that there will be a substantial financial and patient experiential return on investment.
This crisis could not be more urgent. If physician burnout continues to worsen, it will degrade the quality of health care our physicians and hospitals provide, in addition to increasing the profound harm to physician mental health resulting from the serious misalignment between the demands placed on them and their core mission of providing care. Fortunately, we have the tools to make changes. We need to take better care of our physicians and all caregivers so that they can continue to take the best care of us.

 Editor's Note -

The preceding two clippings from the Boston Globe are prime examples of treating the symptoms and ignoring the underlying pathology. While they do a decent job of describing the symptoms of the disease they cover (physician burnout), they totally ignore the underlying pathology that is causing the disease - the excessive complexity of our health insurance system and its excessive focus on the business of medicine rather than on its healing mission. That’s not especially remarkable - clueless “leaders” are a dime a dozen. But the recommendations of the cited report are in fact the product of two Harvard-affiliated institutions and two powerful trade (excuse me - professional) associations. 

The disease afflicting American medicine is widespread and deep rooted indeed..

GoFundMe CEO: ‘Gigantic Gaps’ In Health System Showing Up In Crowdfunding

by Rachel Bluth - Kaiser Health News - January 16, 2019


Scrolling through the GoFundMe website reveals seemingly an endless number of people who need help or community support. A common theme: the cost of health care.
It didn’t start out this way. Back in 2010, when the crowdfunding website began, it suggested fundraisers for “ideas and dreams,” “wedding donations and honeymoon registry” or “special occasions.” A spokeswoman said the bulk of collection efforts from the first year were “related to charities and foundations.” A category for medical needs existed, but it was farther down the list.
In the nine years since, campaigns to pay for health care have reaped the most cash. Of the $5 billion the company says it has raised, about a third has been for medical expenses from more than 250,000 medical campaigns conducted annually.
Take, for instance, the 25-year-old California woman who had a stroke and “needs financial support for rehabilitation, home nursing, medical equipment and uncovered medical expenses.” Or the Tennessee couple who want to get pregnant, but whose insurance doesn’t cover the $20,000 worth of “medications, surgeries, scans, lab monitoring, and appointments [that] will need to be paid for upfront and out-of-pocket” for in vitro fertilization.
The prominence of the medical category is the symptom of a broken system, according to CEO Rob Solomon, 51, who has a long tech résumé as an executive at places like Groupon and Yahoo. He said he never realized how hard it was for some people to pay their bills: “I needed to understand the gigantic gaps in the system.”
This year, Time Magazine named Solomon one of the 50 most influential people in health care.
“We didn’t build the platform to focus on medical expenses,” Solomon said. But it turned out, he said, to be one of those “categories of need” with which many people struggle.
Solomon talked to Kaiser Health News’ Rachel Bluth about his company’s role in financing health care and what it says about the system when so many people rely on the kindness of strangers to get treatment. The conversation has been edited for length and clarity.
Q: KHN and other news outlets have reported that hospitals often advise patients to crowdfund their transplants. It’s become almost institutionalized to use GoFundMe. How do you feel about that?
It saddens me that this is a reality. Every single day on GoFundMe we see the huge challenges people face. Their stories are heartbreaking.
Some progress has been made here and there with the Affordable Care Act, and it’s under fire, but there’s ever-widening gaps in coverage for treatment, for prescriptions, for everything related to health care costs. Even patients who have insurance and supposedly decent insurance [come up short]. We’ve become an indispensable institution, indispensable technology and indispensable platform for anyone who finds themselves needing help because there just isn’t adequate coverage or assistance.
I would love nothing more than for “medical” to not be a category on GoFundMe. The reality is, though, that access to health care is connected to the ability to pay for it. If you can’t do that, people die. People suffer. We feel good that our platform is there when people need it.
Q: Did anyone expect medical funding would become such a big part of GoFundMe?
I don’t think anyone anticipated it. What we realized early on is that medical need is a gigantic category.
A lot of insurance doesn’t cover clinical trials and research and things like that, where people need access to leading-edge potential treatments. We strive to fill these gaps until the institutions that are supposed to handle this handle it properly. There has to be a renaissance, a dramatic change in public policy, in how the government focuses on this and how the health care companies solve this.
This is very interesting. In the places like the United Kingdom, Canada and other European countries that have some form of universal or government-sponsored health coverage, medical [costs] are still the largest category. So it’s not just medical bills for treatment. There’s travel and accommodations for families who have to support people when they fall ill.
Q: What have you learned that you didn’t know before?
I guess what I realized [when I came] to this job is that I had no notion of how severe the problem is. You read about the debate about single-payer health care and all the issues, the partisan politics. What I really learned is the health care system in the United States is really broken. Way too many people fall through the cracks.
The government is supposed to be there and sometimes they are. The health care companies are supposed to be there and sometimes they are. But for literally millions of people they’re not. The only thing you can really do is rely on the kindness of friends and family and community. That’s where GoFundMe comes in.
I was not ready for that at all when I started at the company. When you live and breathe it every day and you see the need that exists, when you realize there are many people with rare diseases but they aren’t diseases a drug company can make money from, they’re just left with nothing.
Q: But what does this say about the system?
The system is terrible. It needs to be rethought and retooled. Politicians are failing us. Health care companies are failing us. Those are realities. I don’t want to mince words here. We are facing a huge potential tragedy. We provide relief for a lot of people. But there are people who are not getting relief from us or from the institutions that are supposed to be there. We shouldn’t be the solution to a complex set of systemic problems. They should be solved by the government working properly, and by health care companies working with their constituents. We firmly believe that access to comprehensive health care is a right and things have to be fixed at the local, state and federal levels of government to make this a reality.
Q: Do you ever worry that medical fundraising on your site is taking away from other causes or other things that need to be funded?
We have billions being raised on our platform on an annual basis. Everything from medical, memorial and emergency, to people funding Little League teams and community projects.
Another thing that’s happened in the last few years is we’ve really become the “take action button.” Whenever there’s a news cycle on something where people want to help, they create GoFundMe campaigns. This government shutdown, for example: We have over a thousand campaigns right now for people who have been affected by it — they’re raising money for people to pay rent, mortgages, car payments while the government isn’t.

Can States Fix the Disaster of American Health Care?

by Elizabeth Rosenthal - NYT - January 17, 2019

Last week, California’s new governor, Gavin Newsom, promised to pursue a smorgasbord of changes to his state’s health care system: state negotiation of drug prices; a requirement that every Californian have health insurance; more assistance to help middle-class Californians afford it; and health care for undocumented immigrants up to age 26.
The proposals fell short of the sweeping government-run single-payer plan Mr. Newsom had supported during his campaign — a system in which the state government would pay all the bills and effectively control the rates paid for services. (Many California politicians before him had flirted with such an idea, before backing off when it was estimated that it could cost $400 billion a year.) But in firing off this opening salvo, Mr. Newsom has challenged the notion that states can’t meaningfully tackle health care on their own. And he’s not alone.
A day later, Gov. Jay Inslee of Washington proposed that his state offer a public plan, with rates tied to those of Medicare, to compete with private offerings.
New Mexico is considering a plan that would allow any resident to buy into the state’s Medicaid program. And this month, Mayor Bill de Blasio of New York announced a plan to expand health care access to uninsured, low-income residents of the city, including undocumented immigrants.
For over a decade, we’ve been waiting for Washington to solve our health care woes, with endless political wrangling and mixed results. Around 70 percent of Americans have said that health care is “in a state of crisis” or has “major problems.” Now, with Washington in total dysfunction, state and local politicians are taking up the baton.
The legalization of gay marriage began in a few states and quickly became national policy. Marijuana legalization seems to be headed in the same direction. Could reforming health care follow the same trajectory?
States have always cared about health care costs, but mostly insofar as they related to Medicaid, since that comes from state budgets. “The interesting new frontier is how states can use state power to change the health care system,” said Joshua Sharfstein, a vice dean at Johns Hopkins Bloomberg School of Public Health and a former secretary of the Maryland Department of Health and Mental Hygiene. He added that the new proposals “open the conversation about using the power of the state to leverage lower prices in health care generally.”
Already states have proved to be a good crucible for experimentation. Massachusetts introduced “Romneycare,” a system credited as the model for the Affordable Care Act, in 2006. It now has the lowest uninsured rate in the nation, under 4 percent. Maryland has successfully regulated hospital prices based on an “all payer” system.
It remains to be seen how far the West Coast governors can take their proposals. Businesses — pharmaceutical companies, hospitals, doctors’ groups — are likely to fight every step of the way to protect their financial interests. These are powerful constituents, with lobbyists and cash to throw around.
The California Hospital Association came out in full support of Mr. Newsom’s proposals to expand insurance (after all, this would be good for hospitals’ bottom lines). It offered a slightly less enthusiastic endorsement for the drug negotiation program (which is less certain to help their budgets), calling it a “welcome” development. It’s notable that his proposals didn’t directly take on hospital pricing, even though many of the state’s medical centers are notoriously expensive.
Giving the state power to negotiate drug prices for the more than 13 million patients either covered by Medicaid or employed by the state is likely to yield better prices for some. But pharma is an agile adversary and may well respond by charging those with private insurance more. The governor’s plan will eventually allow some employers to join in the negotiating bloc. But how that might happen remains unclear.
The proposal by Governor Inslee of Washington to tie payment under the public option plans to Medicare’s rates drew “deep concern” from the Washington State Medical Association, which called those rates “artificially low, arbitrary and subject to the political whims of Washington, D.C.”
On the bright side, if Governor Newsom or Governor Inslee succeeds in making health care more affordable and accessible for all with a new model, it will probably be replicated one by one in other states. That’s why I’m hopeful.
In 2004, the Canadian Broadcasting Corporation conducted an exhaustive nationwide poll to select the greatest Canadian of all time. The top-10 list included Wayne Gretzky, Alexander Graham Bell and Pierre Trudeau. No. 1 is someone most Americans have never heard of: Tommy Douglas.
Tommy Douglas, a Baptist Minister and left-wing politician, was premier of Saskatchewan from 1944 to 1961. Considered the father of Canada’s health system, he arduously built up the components of universal health care in that province, even in the face of an infamous 23-day doctors’ strike.
In 1962, the province implemented a single-payer program of universal, publicly funded health insurance. Within a decade, all of Canada had adopted it.
The United States will presumably, sooner or later, find a model for health care that suits its values and its needs. But 2019 may be a time to look to the states for ideas rather than to the nation’s capital. Whichever state official pioneers such a system will certainly be regarded as a great American.

Is the Drug Industry an Existential Threat to the Private Health Insurance Business? 

by Robert Laszewski - Health Care Policy and  Marketplace Review -  January 16, 2019

At a time when many Democrats are calling for a single-payer health insurance system, are the drug companies inadvertently driving the system on a course to that end?
Consider this.
The longtime political firewall against a single-payer system has been the satisfaction consumers have had with their employer-sponsored health insurance. Most voters have had no interest in giving up their affordable and attractive employer health benefits for the uncertainty of a one-size-fits-all government-run plan.
Employer-sponsored health insurance covers 140 million people—by far the largest part of the under-age-65 health insurance system. Most of these people are in the politically all-important middle class.
But in recent years, the employer share of premiums and out-of-pocket costs has been exploding (Willis Towers Watson, November 2018):
  • The unemployment rate is 3.7%—the lowest since 2000.
  • But, corrected for inflation, wages are up only 2% since January 2015—about one-half of one percent annually.
  • For the bottom 60% of workers by income, wage gains have been completely wiped out by contributions for employer-provided health insurance.
  • For the bottom 50% of workers, employers’ health insurance contributions averaged 30% to 35% of the total compensation package.
  • From 1999 to 2015, worker premiums for a family plan more than doubled in inflation adjusted dollars, from $2,000 annually to $5,000.
In 2008, the average annual share of health insurance costs for employees was $3,354 but by 2018 that was up to $5,547:

Driving these costs has been pharmacy.
I recently polled a number of my clients on their historic and current drug spend.
  • Twenty years ago, drug spend as a percentage of overall medical costs for a health insurer regularly ranged from 5% to 7%.
  • Today, all drug costs, including specialty drugs and infusion drugs, range from 30% to 35% of all costs.
  • Today, employer plan health care cost trend is regularly reported by health plans to be in the 5% to 7% range. 
  • When their drug cost trend is subtracted from overall trend, non-drug trend is about 2%—essentially the level of current overall inflation.
To me there is an inescapable set of conclusions here:
  • Because of the impact health insurance costs are having on take home income, we are at risk that the historical attractiveness employees and their families have had for employer-based health insurance will be lost.
  • If the health insurance industry loses the support of employer-plan participants it will have lost the firewall that has made voters reluctant to support government-run health care.
  • The health plan industry is providing health insurance to consumers for physician, hospital, and related costs at an annual level of increase that is close to overall inflation.
  • With drug costs exploding from 5% to 7% of total costs to now 30% to 35% of costs, the primary villain in the multi-year erosion of the value of the employer-provided health benefit, and private insurance generally, has been drug costs.
Voters, Donald Trump, the Democrats, and the Republicans have all cited drug costs as a huge economic issue that has to be brought under control.
But for the private health insurance industry, it could be the one major factor that does them in if a solution isn’t found.
I can’t see a more important issue for the health insurance industry than the unfettered ability of drug companies to unilaterally dictate prices.

Learning From Cuba’s ‘Medicare for All’

by Nicholas Kristof - NYT - January 18, 2019

HAVANA — Claudia Fernández, 29, is an accountant whose stomach bulges with her first child, a girl, who is due in April.
Fernández lives in a cramped apartment on a potholed street and can’t afford a car. She also gets by without a meaningful vote or the right to speak freely about politics. Yet the paradox of Cuba is this: Her baby appears more likely to survive than if she were born in the United States.
Cuba is poor and repressive with a dysfunctional economy, but in health care it does an impressive job that the United States could learn from. According to official statistics (about which, as we’ll see, there is some debate), the infant mortality rate in Cuba is only 4.0 deaths per 1,000 live births. In the United States, it’s 5.9.
In other words, an American infant is, by official statistics, almost 50 percent more likely to die than a Cuban infant. By my calculations, that means that 7,500 American kids die each year because we don’t have as good an infant mortality rate as Cuba reports.
How is this possible? Well, remember that it may not be. The figures should be taken with a dose of skepticism. Still, there’s no doubt that a major strength of the Cuban system is that it assures universal access. Cuba has the Medicare for All that many Americans dream about.
“Cuba’s example is important since for decades ‘health care for all’ has been more than a slogan there,” said Dr. Paul Farmer, the legendary globe-trotting founder of Partners in Health. “Cuban families aren’t ruined financially by catastrophic illness or injury, as happens so often elsewhere in the neighborhood.”
In Havana, I shadowed a grass-roots doctor, Lisett Rodríguez, as she paid a house call on Fernández — and it was the 20th time Dr. Rodríguez had dropped in on Fernández’s apartment to examine her over the six months of her pregnancy. That’s on top of 14 visits that Fernández made to the doctor’s office, in addition to pregnancy consultations Fernández held with a dentist, a psychologist and a nutritionist.
This was all free, like the rest of the medical and dental system. It’s also notable that Cuba achieves excellent health outcomes even though the American trade and financial embargo badly damages the economy and restricts access to medical equipment.
Fernández has received more attention than normal because she has hypothyroidism, making her pregnancy higher risk than average. Over the course of a more typical Cuban pregnancy, a woman might make 10 office visits and receive eight home visits.
Thirty-four visits, or even 18, may be overkill, but this certainly is preferable to the care common in, say, Texas, where one-third of pregnant women don’t get a single prenatal checkup in the first trimester.
Missing a prenatal checkup is much less likely in Cuba because of a system of front-line clinics called consultorios. These clinics, staffed by a single doctor and nurse, are often run down and poorly equipped, but they make health care readily available: Doctors live upstairs and are on hand after hours in emergencies.
They are also part of the neighborhood. Dr. Rodríguez and her nurse know the 907 people they are responsible for from their consultorio: As I walked with Dr. Rodríguez on the street, neighbors stopped her and asked her about their complaints. This proximity and convenience, and not just the lack of fees, make Cuba’s medical system accessible.
“It helps that the doctor is close, because transportation would be a problem,” Fernández told me.
Home visits are also a chance to reach elderly and disabled people and to coach dysfunctional families, such as those wracked by alcoholism (a common problem), and to work on prevention. During Dr. Rodríguez’s visits to Fernández, for example, they discuss breast-feeding and how to make the home safe for the baby.
“It’s no secret that most health problems can be resolved at the primary-care level by the doctor, nurse or health worker nearest you,” said Gail Reed, the American executive editor of the health journal Medicc Review, which focuses on Cuban health care. “So, there is something to be said for Cuba’s building of a national primary-care network that posts health professionals in neighborhoods nationwide.”
Each consultorio doctor is supposed to see every person in the area at least once a year, if not for a formal physical then at least to take blood pressure.
All this is possible because Cuba overflows with doctors — it has three times as many per capita as the United States — and pays them very little. A new doctor earns $45 a month, and a very experienced one $80.
The opening of Cuba to tourism has created some tensions. A taxi driver who gets tips from foreigners may earn several times as much as a distinguished surgeon. Unless, of course, that surgeon also moonlights as a taxi driver.
Critics inside and outside the country raise various objections to the Cuban system. Corruption and shortages of supplies and medicine are significant problems, and the health system could do more to address smoking and alcoholism.
There are also allegations that Cuba fiddles with its numbers. The country has an unusually high rate of late fetal deaths, and skeptics contend that when a baby is born in distress and dies after a few hours, this is sometimes categorized as a stillbirth to avoid recording an infant death. 
Dr. Roberto Álvarez, a Cuban pediatrician, insisted to me that this does not happen and countered with explanations for why the fetal death rate is high. I’m not in a position to judge who’s right, but any manipulation seems unlikely to make a huge difference to the reported figures.
Outsiders mostly say they admire the Cuban health system. The World Health Organization has praised it, and Ban Ki-moon, the former United Nations secretary general, described it as “a model for many countries.”
In many ways, the Cuban and United States health care systems are mirror opposites. Cuban health care is dilapidated, low-tech and free, and it is very good at ensuring that no one slips through the cracks. American medicine is high-tech and expensive, achieving some extraordinary results while stumbling at the basics: A lower percentage of children are vaccinated in the United States than in Cuba.
The difference can also be seen in treatment of cancer. Cuba regularly screens all women for breast and cervical cancer, so it is excellent at finding cancers — but then it lacks enough machines for radiation treatment. In the United States, on the other hand, many women don’t get regular screenings so cancers may be discovered late — but then there are advanced treatment options.
As Cuba’s population becomes older and heavier (as in the United States, the nutrition problem here is people who are overweight, not underweight), heart disease and cancer are becoming more of a burden. And the lack of resources is a major constraint in treating those ailments.
There’s a Cuban saying: “We live like poor people, but we die like rich people.”

New poll reveals most Democrats are willing to pay Medicare for all tax

by Diane Archer - Just Feed - January 16, 2019

Pundits suggest that one of the biggest challenges to enacting Medicare for All is that the public will object to paying additional public taxes for their health care. But, is that really a challenge? A new Harvard/POLITICO poll shows that more than 80 percent of Democrats are willing to pay the Medicare for all tax.
With Medicare for All, people would stop paying a high private tax–premiums, deductibles and coinsurance for their health care. Indeed, eight in ten Americans would pay less for their health care. Only the wealthiest Americans would pay more.
The poll also shows that:
  • More than four in ten Democrats support repealing and replacing the Affordable Care Act. Their goal is to ensure coverage for everyone. The ACA, which relies on the states to administer health exchanges, and commercial insurers to provide coverage, will never deliver the good affordable care we all need. Today, millions of Americans are still uninsured and millions with coverage struggle to afford needed care.
  • A solid majority of  Republicans (60 percent) now support letting people under 65 buy into Medicare. The poll did not ask whether they supported Medicare for All to everyone. Curiously, fewer Republicans–51 percent–support a public health insurance option than a Medicare buy-in.  They are one and the same thing, two different ways of describing a Medicare option.
  • Republicans and Democrats alike want Congress to lower prescription drug prices. It remains a top priority for Americans. More than nine in ten (92 percent) say it is very important (94 percent of Democrats and 89 percent of Republicans).
  • Republicans and Democrats alike want to ensure coverage for people with pre-existing conditions.
  • And, people in both parties do not want to see cuts to Medicare (more than nine in ten Democrats (93 percent) and nearly eight in ten Republicans.) Republicans in Congress who are eyeing Medicare cuts as a way to address the deficit should take note.
The mid-December poll surveyed 1,013 adults.

Monday, January 14, 2019

Health Care Reform Articles - January 14, 2018

Editor's Note:

The following article should put the final nail on claims that "more price transparency will allow consumers to drive down healthcare prices. It just ain't so, and even perfect and consistent information about healthcare prices won't do the job. Attempts to force disclosure of prices as a way to control costs are a fantasy and are nothing more than yet another distraction, intended to kick the can down the road.


Hospitals Must Now Post Prices. But It May Take a Brain Surgeon to Decipher Them.

WASHINGTON — Vanderbilt University Medical Center, responding to a new Trump administration order to begin posting all hospital prices, listed a charge of $42,569 for a cardiology procedure described as “HC PTC CLOS PAT DUCT ART.”
Baptist Health in Miami helpfully told consumers that an “Embolza Protect 5.5” would cost them $9,818 while a “Visceral selective angio rad” runs a mere $5,538.
On Jan. 1, hospitals began complying with a Trump administration order to post list prices for all their services, theoretically offering consumers transparency and choice and forcing health care providers into price competition.
It’s turning into a fiasco.
“This policy is a tiny step forward, but falls far short of what’s needed,” said Jeanne Pinder, the founder and chief executive of Clear Health Costs, a consumer health research organization. “The posted prices are fanciful, inflated, difficult to decode and inconsistent, so it’s hard to see how an average person would find them useful.”
The data, posted online in spreadsheets for thousands of procedures, is incomprehensible and unusable by patients — a hodgepodge of numbers and technical medical terms, displayed in formats that vary from hospital to hospital. It is nearly impossible for consumers to compare prices for the same service at different hospitals because no two hospitals seem to describe services in the same way. Nor can consumers divine how much they will have to pay out of pocket.
“To 99 percent of the consuming public, these data will be of limited utility — meaningless,” said Kenneth E. Raske, the president of the Greater New York Hospital Association.
The list price for a hospital service is like the sticker price for a car. But as it is playing out, it is as if the car dealers were disclosing the price for each auto part, without revealing the charge for the vehicle as a whole.
The result has baffled consumers.
“This is gibberish, totally meaningless, a foreign language to me,” said Sara Stovall, 41, of Charlottesville, Va., after looking at price lists for hospitals in her area.
She reviewed the price lists for Sentara Martha Jefferson Hospital and for University Hospital, each of which has more than 16,000 items.
“I can’t imagine how I would go about making this useful,” Ms. Stovall said on Sunday. “I wouldn’t know how to find my procedure. I wouldn’t know what services might be rolled up with my procedure. And I would not know the price to me after health insurance.”
By most accounts, the Trump administration is pursuing a worthy goal, but the execution of its plans leaves much to be desired.
After the administration proposed the price-disclosure requirement in April 2018, many hospitals warned of the shortcomings that are now evident.
But federal health officials, accustomed to debating issues inside the Washington policy bubble, have still been surprised at the reaction around the country as consumers and local news media try to decipher the data. The administration says it is open to suggestions for 2020 and beyond.
The price-disclosure requirement, issued by the Department of Health and Human Services, grows out of one sentence in the Affordable Care Act, which says, “Each hospital operating within the United States shall for each year establish (and update) and make public (in accordance with guidelines developed by the secretary) a list of the hospital’s standard charges for items and services provided by the hospital.”
The idea languished for eight years. Under prior guidance from the government, hospitals could meet their obligations by providing charges to patients on request. But the Trump administration wanted to go further.
“We’ve updated our guidelines to specifically require hospitals to post price information on the internet in a machine-readable format,” Seema Verma, the administrator of the Centers for Medicare and Medicaid Services, said last week. “This is a historic change from what’s been required in the past.”
“This is about empowering patients,” Ms. Verma said.
It has not worked out that way, at least so far. Martin Gaynor, a professor of economics and health policy at Carnegie Mellon University in Pittsburgh, described list prices as “somewhat fictitious.”
“If this is an initial step leading to real transparency with actionable, usable information, that would be fantastic,” Mr. Gaynor said.
But in its current form, he added, the price information is “not very useful and could even be misleading” because a hospital with high list prices could be the cheaper alternative for some consumers, depending on their insurance.
“For patients to know up front how much their care will cost, that’s incredibly valuable,” said Brenda L. Reetz, the chief executive of Greene County General Hospital in rural southwest Indiana. “We’ve posted our prices, as required. But I really don’t think the information is what the consumer is actually wanting to see.”
Spending on hospital care last year totaled $1.1 trillion, or nearly one-third of all health spending, according to the Department of Health and Human Services. So even small improvements in the market could yield big savings.
The Trump administration adopted the new requirement as part of its agenda to promote “transparency” in health care, in the belief that health markets would work better if consumers had more information. In another example, federal officials want to require pharmaceutical companies to disclose the list price of prescription drugs in television advertisements.
“Providers and insurers have to become more transparent about their pricing,” Alex M. Azar II, the secretary of health and human services, said last year. “There is no more powerful force than an informed consumer.”
The Trump administration told hospitals that they had to post their standard charges for all services and items, including drugs, by Jan. 1, but did not define “standard charges.” In later guidance, it said the format was “the hospital’s choice.”
“Without a standard definition, patients cannot make accurate comparisons between hospitals,” said Herb B. Kuhn, the president of the Missouri Hospital Association.
No hospitals operating in the United States are exempt from the new requirement, but the Trump administration has not said how it plans to enforce it. Federal officials have asked the public to suggest “enforcement mechanisms.”
Each hospital has a list — known as a “chargemaster” — of prices for thousands of goods and services, including medical procedures, laboratory tests, supplies and medications. But the price information is often difficult and sometimes impossible to find on hospital websites.
List prices may be relevant for some consumers. People with high-deductible plans may have to pay some or all of the list price until they meet the deductible, and people with insurance who go outside their health plan’s network may also have to pay a substantial share of the list price.
But to others, the prices listed on the “chargemaster” may have no bearing on the cost of their care. Health plans and insurance companies usually negotiate much lower prices, and uninsured patients often qualify for substantial discounts.
“Many hospitals still see the chargemaster price as an important way to enhance revenue,” said Ge Bai, an expert on health care finance and accounting at Johns Hopkins University. “Having a high list price means they have more leverage in negotiating prices for people covered by private insurance.”
Even while complying with the new requirement, many hospitals have posted disclaimers warning consumers not to rely on the data.
The University of Texas MD Anderson Cancer Center, for example, says that it “does not warrant the accuracy, completeness or usefulness” of the charges listed on its website.
If hospitals have complaints about the new requirements, Ms. Verma said, they should voluntarily provide patients with more useful information.
“Hospitals don’t have to wait for us to go further in helping their patients understand what care will cost,” she said.

It’s Still The Prices, Stupid: Why The US Spends So Much On Health Care, And A Tribute To Uwe Reinhardt

 A 2003 article titled “It’s the Prices, Stupid,” and coauthored by the three of us and the recently deceased Uwe Reinhardt found that the sizable differences in health spending between the US and other countries were explained mainly by health care prices. As a tribute to him, we used Organization for Economic Cooperation and Development (OECD) Health Statistics to update these analyses and review critiques of the original article. The conclusion that prices are the primary reason why the US spends more on health care than any other country remains valid, despite health policy reforms and health systems restructuring that have occurred in the US and other industrialized countries since the 2003 article’s publication. On key measures of health care resources per capita (hospital beds, physicians, and nurses), the US still provides significantly fewer resources compared to the OECD median country. Since the US is not consuming greater resources than other countries, the most logical factor is the higher prices paid in the US. Because the differential between what the public and private sectors pay for medical services has grown significantly in the past fifteen years, US policy makers should focus on prices in the private sector.

Additional Excerpts 

From the Introduction

Much has happened in the US and other OECD countries in health policy and health care delivery in the intervening fifteen years. Since 2003 there has been much greater attention given to the cost of treating people with chronic conditions, a greater emphasis on value-based care, more people entering managed care programs, the passage of the Affordable Care Act, the introduction of electronic medical records, consolidation of hospitals and insurers, and many other changes designed to lower the level of spending in the US. As a result, it is important to assess whether the general conclusion that prices are responsible for most of the difference in health spending remains valid and what, if anything, has changed.

Health Spending

US per capita health spending was $9,892 in 2016. The US spending level was 25 percent higher than that of Switzerland ($7,919), the country with the next-highest expenditure per capita; 108 percent higher than that of neighboring Canada ($4,753) and 145 percent higher than the OECD median of $4,033. The US spent 17.2 percent of its GDP on health care in 2016, and the OECD median was 8.9 percent.

Public versus private spending

The US financed 50.9 percent of its health care from private sources in 2016, compared to the OECD median of 25.0 percent. It is noteworthy that the differential between the prices paid by public and private insurers in the US has increased drastically since the 2003 article was written. In 2000 the price differential between what public and private insurers paid was approximately 10 percent. The Medicare Payment Advisory Commission recently estimated that private insurers pay prices that are 50 percent higher than what Medicare pays. Increased attention needs to be paid to the prices paid in the private sector.

Spending on pharmaceuticals

In 2015 per capita spending on pharmaceuticals varied from $171 in Poland to $1,011 in the US, with most of the OECD countries spending $400–$600. Recent studies found that prices for brand-name pharmaceuticals were responsible for most of the difference in pharmaceutical spending, with the US providing a considerable portion of the profits to the pharmaceutical industry.

Supply of physicians

In 2015 the US had 19 percent fewer practicing physicians per 1,000 population than the median OECD country (2.6 versus 3.2). The median OECD country had 12.1 medical school graduates in 2015 per 100,000 population, while the US had only 7.5. The US also had the lowest percentage of generalist physicians among the twenty-eight countries with data available, according to the OECD definition: 11.9 percent. The OECD median was 27.9 percent.

Supply of nurses

The US nurse-to-population ratio declined from 2000 to 2015, when it was 7.9 per 1,000 population—20 percent below the OECD median (9.9 per 1,000).


The US had 26 percent fewer inpatient acute care hospital beds per 1,000 population (2.5) than the median OECD country (3.4) in 2015.

Medical technology

The US was second (after Japan) in MRI units per million population and third (after Japan and Australia) in CT scanners per million population in 2015.

Explanations for differences

There is a growing literature on administrative costs. A Commonwealth Fund comparison of health insurance administrative costs showed that the US spent $737 per capita on administration, compared to $94 per capita in the median OECD country. The next-highest-spending country after the US (Switzerland) had administrative costs of only $280. In 2017 Steffie Woolhandler and David Himmelstein estimated that the US would save about $617 billion (about 20 percent of its total health spending) if it moved to a single-payer system. A study comparing administrative costs of physicians in Canada and the US found that US physicians spend considerably more on administrative services than Canadian physicians do.

Health spending versus health care provision

The 2003 article discussed how the buy and sell sides of the marketplace operate. The subsequent literature has validated the arguments made in the 2003 article. First, many OECD countries continue to use their monopsony power to control prices, while the US continues to have geographic areas with providers able to obtain “rents” from having monopolies in their community. Second, the current literature continues to show that the US buy side continues to be highly fragmented by international standards.

A series of recent articles has examined the relationship between the market power of providers in a community and health outcomes and found association with higher prices but very little correlation with health outcomes. These studies show that insurance companies are strengthening their market power through consolidation, while hospitals and physicians’ practices merge into giant conglomerates, strengthening their sell-side market power and driving up the prices.

In the US the evidence suggests that consolidation of insurers does not necessarily lead to lower premiums, copayments, or deductibles, but it shifts profits from providers to insurers, thereby transferring revenues from providers to insurers and not to society.

It's still the prices, stupid

In 2000 the US had fewer physicians per 1,000 population, physician visits per capita, and acute care beds per capita, as well as fewer hospital admissions per 1,000 population and acute care days per capita, compared to the median OECD country. The US was still not devoting more real resources to health care than most other OECD countries in 2015 or 2016. At that time, the US had 26 percent fewer hospital beds per capita, 20 percent fewer practicing nurses, and 19 percent fewer practicing physicians per capita, compared to the OECD median country. Because the US is still not devoting more real resources to medical care than the typical OECD country, we believe that the conclusion that “it’s the prices, stupid,” remains valid. What is different between 2003 and 2016 is that the differential between what public and private insurers pay for health care services has become wider. Lowering prices in the US will need to start with private insurers and self-insured corporations. 

 Can’t kill the ACA. Can’t get it to work.

by Michael Kinsley - LA Times - January 10, 2019

It was a pretty good year for President Barack Obama’s major legacy, health care reform, aka Obamacare or the Affordable Care Act. The pace of new signups has been respectable if not miraculous, and now Republicans in Congress have decided (correctly) that perhaps total war against Obamacare is not their wisest strategy.
People seem to like the ACA. They especially like the provision forbidding insurers to discriminate against those with preexisting conditions. This formerly obscure technical term of the insurance business has become the center of the health care discussion. You can’t call it a debate, because there’s no basic disagreement. Everyone’s for covering preexisting conditions. The question is, Who got there first?
Health care is now like Social Security, the famous “third rail of American politics” — that is, the one that will kill you if you touch it, like the third rail of the New York subway. (What? The subway has no fourth rail? Relax. It’s only a metaphor.) So Republicans are claiming, preposterously, that their many attempts to kill Obamacare — both before and after its enactment — were actually attempts to improve it.
Imagine walking into an insurance company office, or maybe you go online to log in to one of those “exchange” thingummies that Obamacare encourages the states to start. You have a rare tropical disease that can only be held at bay by an equally rare drug costing $200,000 a year. (The number and situation are made up, but not unrealistic.) Before Obamacare, insurance companies and plans could have said no to you. They could cherry-pick their customers, taking only the ones they wanted. The more you needed medical insurance, the less likely you were to be able to get it.
Democrats — quite unfairly — have used the preexisting conditions question to make insurance companies look like bad guys. But they aren’t.
The insurance companies are not behaving like heartless monsters. They are behaving like insurance companies. As long as preferring healthy, inexpensive customers to cheap and sick ones was legal, they’d have been crazy — and possibly violating their fiduciary duty to stockholders — if they didn’t discriminate against people with preexisting conditions.
Democrats believe they solved the preexisting conditions problem by simply forbidding discrimination against people with preexisting conditions. This sounds easier than actually doing it will be.
There are all sorts of ways, subtle or otherwise, that a salesperson can discourage a sale without overt discrimination. She could frown, or dress like a slob or merely smell bad, but the effect would be the same as discrimination. Likewise an insurance company. To use a well-known example, suppose the insurance company just happens to put all of its sales offices on the second floors of buildings without an elevator. No one in a wheelchair need apply. Or suppose it keeps the doctors with the highest ratings out of its network.
Even if a company plays it straight and doesn’t try to game the system, a so-called insurance death spiral can develop. If enough young healthy types buy cheap plans (with less coverage), less money goes into the pot to cover those who need care. And the whole edifice swivels into a dark hole.
Obamacare assumes that money-in from healthy people will be more than enough to balance the money-out for the high cost of people with health problems — preexisting conditions. But there is no guarantee of this. In fact, it was always pretty unlikely that Obamacare would actually generate a profit.
But go ahead, boys and girls of Congress. Have your fun. And when you decide to get serious, maybe we can have single-payer.

‘Extremists’ like Elizabeth Warren and Alexandria Ocasio-Cortez are actually closer to what most Americans want - The Boston Globe

By Margery Eagan - Boston Globe - January 10, 2019
‘Far left.” “Too liberal.” “Out of the mainstream.” Google US Senator Elizabeth Warren. You’ll see descriptions like these.
“Socialist.” “Radical.” “Extreme.” Google US Representative Alexandria Ocasio-Cortez, the whirling, twirling, dancing phenom out of the Bronx. You’ll see words like those.
But are even Ocasio-Cortez’s positions all that “fringe” in 2019?
I don’t think so.
On “60 Minutes” Sunday, Ocasio-Cortez talked about a 70 percent tax rate for Americans earning more than $10 million a year. She said this would fund a Green New Deal: big money for renewable energy and technologies to avert climate catastrophe.
That’s soak-the-rich, prosperity-killing insanity, conservatives claimed.
But many economists, including Nobel Prize winners Paul Krugman and MIT’s Peter Diamond, agree with Ocasio-Cortez. Diamond argued years ago for a top rate of 73 percent. Krugman recently wrote that the “right’s denunciation of AOC’s ‘insane’ policy ideas serves as a very good reminder of who is actually insane.”
And of who’s pulling a fast one: the billionaire campaign donors arguing for debunked trickle-down economics. Why? To keep more of their billions.
But many forget that the top tax rate was more than 90 percent during the 1950s, and 70 percent for all income above $216,000, right up until Ronald Reagan became president, in 1981. He then declared government the enemy and slashed taxes for the rich. Thus ended the most successful period of middle-class economic growth in America’s history.
Some of us actually remember those halcyon days. Dad’s salary alone was enough to support a middle-class family of four or five, to buy a modest home, get the kids most of the way through college, and still swing a vacation on the Cape in July.
Hard to imagine now. But when the rich paid more, the government built highways and bridges. The MBTA parking garage wasn’t collapsing at Alewife station. The Red Line tracks weren’t catching on fire.
No one talked about the 1 percent vs. the 99 percent, because income inequality was far less severe and it was hard to conceive of a single human amassing a net worth of, say, $88 billion (Warren Buffett, CEO of Berkshire Hathaway) or even $53 million (Robert Iger, CEO of Walt Disney).
Right before Congress passed the Trump millionaire tax giveaway, Pew Research found that 43 percent of voters wanted taxes raised on Americans earning $250,000, nowhere close to $10 million. Sixty percent of Americans already suspected those millionaires weren’t paying their fair share.
So why, asks New York magazine’s Eric Levitz, do we in the media call Republican Susan Collins of Maine, who voted for Trump’s tax scheme, a “moderate” instead of an pro-oligarch extremist? And why is Ocasio-Cortez, with her evidence-based tax proposal, derided as a know-nothing socialist kook?
Meanwhile Warren says she’s a capitalist who wants capitalism reasonably regulated again. She wants to regulate Wall Street’s big banks. She wants to keep the Consumer Financial Protection Bureau, her brainchild, as a regulatory check against cheating mortgage lenders, credit companies, and student loan servicers. But the Trump administration, despite ever higher consumer complaints, has gutted its enforcement power.
Aren’t we all supposed to oppose corporate cheats?
She also wants Medicare for all and free public college tuition.
So do 70 percent of Americans (85 percent of Democrats and 52 percent of Republicans). And 79 percent of Democrats and 41 percent of Republicans support free public college tuition.
Most Americans also want coverage for preexisting conditions (75 percent), including majorities of Democrats, independents, and Republicans.
So who is really out of the mainstream? Warren, or Donald Trump and Republicans who’ve stripped away American’s health care? Ocasio-Cortez, or Donald Trump and Republicans who oppose what most Americans actually want on everything from health care and taxes to minimum wage, gun background checks, climate protections and yes, even immigration? (That last issue, you’ll recall, has kept the government shut down for more than two weeks.)
Seems clear to me. Trump ran as a populist, but governs like Marie Antoinette. And a sleeping, scammed America is finally waking up.

Massachusetts’ “Price Transparency” Resolution To Surprise Facility Fees, Consumer Protection Laws Yield To Health Care Complexity

by Jackson Williams - Health Affairs - January 10, 2019

It is often said that “health care is different” from other commodities— that it is essential, that traditional markets don’t work, that information asymmetry is all but impossible to overcome. This shibboleth may have guided Massachusetts’ attorney general in settling some complaints about prices at hospital-owned “urgent care” clinics. This was a dispute amenable to disposition under ordinary consumer protection laws and doctrines. However, the attorney general’s resolution of this matter in September 2018 exemplifies how the perception of health care’s complexity can intimidate and perplex regulators, complicating efforts to contain costs.
The facts of the case are laid out in a Boston Globe article:
“Patients sought treatment in an ordinary physician office or urgent care center. But to their shock, they were billed for an expensive outpatient hospital visit instead.”
“Patients complained about bills from the [Brigham and Women’s Hospital] urgent care center in Foxborough, Newton-Wellesley Hospital’s urgent care center in Waltham, and a North Shore Medical Center-affiliated urgent care center in Danvers.”
“One woman received a $400 bill for treatment for an eye injury at North Shore Urgent Care in Danvers—far more than the $75 listed on her insurance card—because it was billed as an ‘outpatient clinic’ visit, according to a complaint.”
“‘This is 100% false advertising,’ her husband complained. ‘On both the website and the gigantic sign in the parking lot, URGENT CARE can be seen in big letters.’”
An experienced consumer advocate would analyze this scenario under the Federal Trade Commission’s (FTC’s) definition of deceptive practices. The 100-plus-year-old FTC Act is the foundation of consumer protection law, and each state has a “little FTC Act,” usually called the Unfair and Deceptive Acts and Practices or UDAP, the Massachusetts iteration of which the state attorney general was applying in this situation. Massachusetts, like a majority of states, incorporates the FTC’s decisions into its UDAP jurisprudence.
FTC policy is to evaluate an “entire advertisement, transaction, or course of dealing in determining how reasonable consumers are likely to respond” to, say, a sign in a clinic’s parking lot saying “URGENT CARE.” Most consumers understand urgent care to be the analog of margarine to a hospital’s butter—a somewhat inferior and definitely cheaper product. No reasonable consumer would expect to pick up margarine in the supermarket and pay the price for butter. The Danvers, Massachusetts, patient made a conscious decision, based on the seriousness of her medical issue, to forego the extensive resources available in a hospital in favor of the cheaper option, which is what some insurers have been nudging consumers to do.
Instead of insisting that these facilities either lower their charges or remove the “urgent care” name, the attorney general’s settlement simply requires a disclosure of the higher hospital billing on “the Internet homepage of the facility” and “clearly and conspicuously displaying signage with the disclosure at the urgent care registration desk.” It is here that the attorney general significantly departs from FTC policy, which “looks to the impression made by advertisements as a whole” and holds that “pro forma statements or disclaimers may not cure otherwise deceptive messages or practices.” To see why that might be, look for the mandated disclosure on this hospital’s urgent care home page; even after clicking the link to the disclosure, no price in dollars is stated.
In short, Massachusetts is giving wide berth to the hospital “facility fee.”
Facility fees are a kind of junk fee like those commonly added to bills in the mortgage lending, telecom, and travel businesses. There are no hard and fast rules on the legality of junk fees, but businesses strive to make the fees small enough that consumers won’t complain or walk away, and to make them sound plausibly related to the transaction while still set slightly apart from it, for4 example, a hotel “resort fee” that supposedly covers wifi service. The twin goals are to be able to charge more than the advertised or expected price while avoiding a definitive court ruling on the practice’s legality (usually by settling class action lawsuits challenging the most piggy examples).
Health care consumers generally are protected from junk fees since the contracts providers sign when they join an insurer network will prohibit them. Whether because of these hospitals’ market power or because insurers perceived urgent care as a destination for healthier enrollees unlikely to exceed their deductibles, the companies insuring the Massachusetts complainants did not try to protect them from these fees. That makes it especially disappointing that the attorney general did not step in as a second line of defense.
This example raises two overarching questions. First, why did the hospitals violate the “unwritten rule” of junk fees and make them so large and so noticeable, thereby drawing complaints? The immediate answer, of course, is that they thought they could away with it—which they did.
Second, why did the attorney general decline to shut down the billing?
One answer, I think, is intimidation. The head of the hospital, usually the largest or most prominent employer in town, says that facility fees are necessary to offer “24/7 access to care for all types of patients, to serve as a safety net provider for vulnerable populations, and to have the resources needed to respond to disasters.” An assistant attorney general may wonder, should the hospital be held to account under the same standards governing door-to-door encyclopedia salesmen? It requires some confidence to ask, if the hospital cannot provide urgent care services at urgent care prices, why does it not leave that market to smaller players who can, just as large airlines code-share with smaller carriers to arrange regional jet service? Only something akin to learned helplessness can explain a “price transparency” settlement that does not extend to disclosing the actual price.
Another answer is to recognize the march of price transparency from buzzword to all-purpose solution for all health care cost problems such as lack of competition. Transparency—or the lack thereof—is not the problem here, and not just because, as the FTC has stated, “Written disclosures and fine print may be insufficient to correct a misleading impression.” The problem is that the prices are unreasonably, unjustifiably, and unsustainably high—and we need help in lowering them from our state attorneys general.

Memorial Sloan Kettering Curbs Executives’ Ties to Industry After Conflict-of-Interest Scandals

by Katie Thomas and Charles Ornstein - NYT - January 11, 2019

This article was reported and written in collaboration with ProPublica, the nonprofit journalism organization.
Memorial Sloan Kettering Cancer Center, one of the world’s leading research institutions, announced on Friday that it would bar its top executives from serving on corporate boards of drug and health care companies that, in some cases, had paid them hundreds of thousands of dollars a year.
Hospital officials also told the center’s staff that the executive board had made permanent a series of reforms designed to limit the ways in which its top executives and leading researchers could profit from work developed at Memorial Sloan Kettering, a nonprofit with a broad social mission that admits about 23,500 cancer patients each year.
The conflicts at Memorial Sloan Kettering, unearthed by The New York Times and ProPublica, have had a rippling effect on other leading cancer institutions across the country. Dana-Farber Cancer Institute in Boston and Fred Hutchinson Cancer Research Center in Seattle, both of whose executives sit on corporate boards, are among the institutions reconsidering their policies on financial ties.
In the wake of reports about board memberships held by Memorial Sloan Kettering officials last fall, Dr. Craig B. Thompson, the hospital’s chief executive, resigned in October from the board of Merck. The company, which makes the blockbuster cancer drug Keytruda, had paid him about $300,000 in 2017 for his service.
The announcement on Friday was one of several steps the cancer center said it was considering as part of an institutionwide overhaul of its corporate relationships and conflict-of-interest policies. The cancer center has hired Deloitte as well as two law firms, Ropes & Gray and Debevoise & Plimpton, to help conduct its reviews.
Debra Berns, the center’s chief risk officer, also said in an email to employees that the hospital’s Board of Overseers and Managers formalized a policy enacted last fall that prohibits board members from investing in start-up companies that Memorial Sloan Kettering helped to found. In addition, it also prevents hospital employees who represent Memorial Sloan Kettering on corporate boards from accepting personal compensation, like equity stakes or stock options, from the companies.

Memorial Sloan Kettering Cancer Center memo by Debra Berns, chief risk officer

Changes in conflict-of-interest policies. Jan. 11, 2019

Memorial Sloan Kettering Cancer Center, one of the world’s leading research institutions, announced on Friday that it would bar its top executives from serving on corporate boards of drug and health care companies that, in some cases, had paid them hundreds of thousands of dollars a year.
Hospital officials also told the center’s staff that the executive board had made permanent a series of reforms designed to limit the ways in which its top executives and leading researchers could profit from work developed at Memorial Sloan Kettering, a nonprofit with a broad social mission that admits about 23,500 cancer patients each year.
The conflicts at Memorial Sloan Kettering, unearthed by The New York Times and ProPublica, have had a rippling effect on other leading cancer institutions across the country. Dana-Farber Cancer Institute in Boston and Fred Hutchinson Cancer Research Center in Seattle, both of whose executives sit on corporate boards, are among the institutions reconsidering their policies on financial ties.
In the wake of reports about board memberships held by Memorial Sloan Kettering officials last fall, Dr. Craig B. Thompson, the hospital’s chief executive, resigned in October from the board of Merck. The company, which makes the blockbuster cancer drug Keytruda, had paid him about $300,000 in 2017 for his service.
The announcement on Friday was one of several steps the cancer center said it was considering as part of an institutionwide overhaul of its corporate relationships and conflict-of-interest policies. The cancer center has hired Deloitte as well as two law firms, Ropes & Gray and Debevoise & Plimpton, to help conduct its reviews.
Debra Berns, the center’s chief risk officer, also said in an email to employees that the hospital’s Board of Overseers and Managers formalized a policy enacted last fall that prohibits board members from investing in start-up companies that Memorial Sloan Kettering helped to found. In addition, it also prevents hospital employees who represent Memorial Sloan Kettering on corporate boards from accepting personal compensation, like equity stakes or stock options, from the companies.
Dr. Walid Gellad, director of the Center for Pharmaceutical Policy and Prescribing at the University of Pittsburgh, called the policy changes a “watershed moment.”
“This is highly significant, especially at such a high-profile academic center,” Dr. Gellad said in an email. “Leadership matters, and the institution has decided that their leaders should not also be concurrently leading for-profit health companies.”
When doctors enter into financial relationships with companies, the concern is that these ties can shape the way studies are designed and medications are prescribed to patients, potentially allowing bias to influence medical practice. A 2014 study in JAMA found that about 40 percent of the largest publicly traded drug companies had a leader of an academic medical center on their boards.
Ms. Berns said the Memorial Sloan Kettering board’s policy decision was intended to emphasize the hospital’s focus on education, research and treatment of patients. Dr. Nadeem R. Abu-Rustum, who is president of Memorial Sloan Kettering’s medical staff, said the policy changes were “well-received” by employees.
Memorial Sloan Kettering has been shaken by the unfolding series of conflicts of interest since September, when The Times and ProPublica reported that its chief medical officer, Dr. José Baselga, had failed to disclose millions of dollars in payments from drug and health care companies in dozens of articles in medical journals.
Dr. Baselga resigned days later, and he also stepped down from the boards of the drugmaker Bristol-Myers Squibb and Varian Medical Systems, a radiation equipment manufacturer. Earlier this month, AstraZeneca announced that it had hired Dr. Baselga to run its new oncology unit.
Additional reports detailed how other top officials had cultivated lucrative relationships with for-profit companies, including an artificial intelligence start-up, Paige.AI, that was founded by a member of Memorial Sloan Kettering’s executive board, the chair of the pathology department and the head of a research lab. The hospital struck an exclusive deal with the company to license images of 25 million patient tissue slides that had been collected over decades.
Another article detailed how a hospital vice president was given a stake of nearly $1.4 million in a newly public company as compensation for representing Memorial Sloan Kettering on its board.
When news of Dr. Baselga’s disclosure lapses first became public, 12 doctors and researchers at the hospital served on the boards of publicly traded companies. The number has now dropped to nine.
On October 1, some doctors at the hospital called for a no-confidence vote in Dr. Thompson’s leadership and questioned whether the industry relationships were jeopardizing the hospital’s mission.
No such vote was taken, but a day later, Dr. Thompson stepped down from the boards of Merck and Charles River Laboratories, which assists in early drug development.
The hospital task force is expected to release draft recommendations in February and will solicit feedback from employees, Ms. Berns said in the memo released Friday. The review is also expected to examine faculty membership on corporate boards, participation on companies’ scientific advisory boards, and doctors’ and researchers’ consulting relationships with drug and health care companies.
Memorial Sloan Kettering will also host a symposium in February on disclosing conflicts of interest in medical journals, in what Ms. Berns described as “a first step toward developing a common framework that harmonizes financial disclosures in research publications.”
Ms. Berns delivered details of the review at a medical staff meeting Friday morning that was also attended by Dr. Lisa DeAngelis, the hospital’s acting physician-in-chief. During the meeting, Dr. DeAngelis sought to reassure employees that hospital leaders were taking their concerns seriously while also defending the hospital’s reputation as a world-renowned cancer center, according to accounts of the meeting.
At one point, according to the accounts, Dr. DeAngelis celebrated recent good news for the institution, including the Food and Drug Administration’s approval of a new cancer drug, Vitravki, developed at the hospital.
She also cited internal research that she said showed Memorial Sloan Kettering’s treatment of the Supreme Court Justice Ruth Bader Ginsburg had received positive press that overshadowed the recent conflict-of-interest coverage.
Justice Ginsburg is recovering from cancer surgery on her left lung that was performed at the center. The Supreme Court announced on Friday that she was still recovering and would not be on the bench next week, but that there was no evidence of any more cancer.


Democrats Don't Just Support Medicare for All, 84% in New Poll Want Party Leaders to Make It 'Extremely Important Priority'

by John Queally - Common Dreams - January 8, 2019

'Are you listening?'
That was the question posed by healthcare justice advocates to Senate Minority Leader Chuck Schumer and Speaker of the House Nancy Pelosi—and potential Democratic presidential candidates as well—after another new poll showed overwhelming support for Medicare for All by Democratic Party voters.
"They may have the money. But we have the people."
—Sen. Bernie Sanders (I-Vt.)
According to the Politico/Harvard poll (pdf), released Monday, a full 84 percent of Democrats says "providing health insurance coverage for everyone through a taxpayer-funded national plan like MedicareForAll" should "be an extremely important priority" for the party. Politico reports:
While support for a national, taxpayer-funded plan is concentrated on the Democratic side, 60 percent of Republican respondents backed allowing Americans under 65 to buy into Medicare (71 percent of respondents overall supported the idea, and 83 percent of Democrats).
The poll involved a series of questions that made distinctions between a Medicare for All system that covered everyone, a possible "buy-in" option for people under 65, and a more vague "public option" that could be purchased. "The poll showed most people weren't aware of a Medicare buy-in or public option," Politico noted, "but were broadly supportive of the ideas when informed about them."
While numerous polls over the last two years have shown increasingly high levels for a single-payer approach or Medicare For All solution to the nation's healthcare crisis, many Democratic Party leaders have clung to their reluctance of the idea.
Last week, Democrat Terry McAuliffe, the former governor of Virginia who says he is contemplating a run for president, warned the party away from bold solutions like Medicare for All, saying voters are not ready for policies that he characterized, without evidence, of being "unrealistic."
But those pushing for Medicare for All say the political winds are at their back as the polling continues to suggest the American people are ready to join the rest of the world's developed nations by creating a healthcare system that includes everybody and leaves nobody out.
 While leaders like Pelosi and Schumer have yet to embrace Medicare for All fully, there has been movement. As the Democrats took control of the House last week, and the Speaker's gavel was returned to Pelosi, it was announced that major committees would hold hearings on Medicare For All this year, a development advocates called a "giant step." Meanwhile, progressive organizing continues to swell with National Nurses United, the nation's largest nurses union, holding "barnstorming" events nationwide next month to demand Medicare for All and the Democratic Socialists of America continuing their door-to-door and grassroots campaigning.
As Sen. Bernie Sanders (I-Vt) said on Tuesday morning: "The fight for Medicare for all will be opposed by all of the special interests—drug companies, insurance companies, Wall Street—who make billions from our dysfunctional health care system. They may have the money. But we have the people."
The fight for Medicare for all will be opposed by all of the special interests—drug companies, insurance companies, Wall Street—who make billions from our dysfunctional health care system.
They may have the money. But we have the people.
— Bernie Sanders (@SenSanders) January 8, 2019
The Politico/Harvard poll surveyed 1,013 adults between Dec. 11-16. The margin of error is between plus or minus 3.7 and 5.2 percentage points.

V.A. Seeks to Redirect Billions of Dollars Into Private Care

by Jennifer Steinhauer and Dave Phillips - NYT - January 12, 2019

WASHINGTON — The Department of Veterans Affairs is preparing to shift billions of dollars from government-run veterans’ hospitals to private health care providers, setting the stage for the biggest transformation of the veterans’ medical system in a generation.
Under proposed guidelines, it would be easier for veterans to receive care in privately run hospitals and have the government pay for it. Veterans would also be allowed access to a system of proposed walk-in clinics, which would serve as a bridge between V.A. emergency rooms and private providers, and would require co-pays for treatment.
Veterans’ hospitals, which treat seven million patients annually, have struggled to see patients on time in recent years, hit by a double crush of returning Iraq and Afghanistan veterans and aging Vietnam veterans. A scandal over hidden waiting lists in 2014 sent Congress searching for fixes, and in the years since, Republicans have pushed to send veterans to the private sector, while Democrats have favored increasing the number of doctors in the V.A.
If put into effect, the proposed rules — many of whose details remain unclear as they are negotiated within the Trump administration — would be a win for the once-obscure Concerned Veterans for America, an advocacy group funded by the network founded by the billionaire industrialists Charles G. and David H. Koch, which has long championed increasing the use of private sector health care for veterans.
For individual veterans, private care could mean shorter waits, more choices and fewer requirements for co-pays — and could prove popular. But some health care experts and veterans’ groups say the change, which has no separate source of funding, would redirect money that the current veterans’ health care system — the largest in the nation — uses to provide specialty care.
Critics have also warned that switching vast numbers of veterans to private hospitals would strain care in the private sector and that costs for taxpayers could skyrocket. In addition, they say it could threaten the future of traditional veterans’ hospitals, some of which are already under review for consolidation or closing.
President Trump, who made reforming veterans’ health care a major point of his campaign, may reveal details of the plan in his State of the Union address later this month, according to several people in the administration and others outside it who have been briefed on the plan.
The proposed changes have grown out of health care legislation, known as the Mission Act, passed by the last Congress. Supporters, who have been influential in administration policy, argue that the new rules would streamline care available to veterans, whose health problems are many but whose numbers are shrinking, and also prod the veterans’ hospital system to compete for patients, making it more efficient.
“Most veterans chose to serve their country, so they should have the choice to access care in the community with their V.A. benefits — especially if the V.A. can’t serve them in a timely and convenient manner,” said Dan Caldwell, executive director of Concerned Veterans for America.
One of the group’s former senior advisers, Darin Selnick, played a key role in drafting the Mission Act as a veterans’ affairs adviser at the White House’s Domestic Policy Council, and is now a senior adviser to the secretary of Veterans Affairs in charge of drafting the new rules. Mr. Selnick clashed with David J. Shulkin, who was the head of the V.A. for a year under Mr. Trump, and is widely viewed as being instrumental in ending Mr. Shulkin’s tenure.
Mr. Selnick declined to comment.
Critics, which include nearly all of the major veterans’ organizations, say that paying for care in the private sector would starve the 153-year-old veterans’ health care system, causing many hospitals to close.
“We don’t like it,” said Rick Weidman, executive director of Vietnam Veterans of America. “This thing was initially sold as to supplement the V.A., and some people want to try and use it to supplant.”
Members of Congress from both parties have been critical of the administration’s inconsistency and lack of details in briefings. At a hearing last month, Senator John Boozman, Republican of Arkansas, told Robert L. Wilkie, the current secretary of Veterans Affairs, that his staff had sometimes come to Capitol Hill “without their act together.”
Although the Trump administration has kept details quiet, officials inside and outside the department say the plan closely resembles the military’s insurance plan, Tricare Prime, which sets a lower bar than the Department of Veterans Affairs when it comes to getting private care.
Tricare automatically allows patients to see a private doctor if they have to travel more than 30 minutes for an appointment with a military doctor, or if they have to wait more than seven days for a routine visit or 24 hours for urgent care. Under current law, veterans qualify for private care only if they have waited 30 days, and sometimes they have to travel hundreds of miles. The administration may propose for veterans a time frame somewhere between the seven- and 30-day periods.
Mr. Wilkie has repeatedly said his goal is not to privatize veterans’ health care, but would not provide details of his proposal when asked at a hearing before Congress in December.
In remarks at a joint hearing with members of the House and Senate veterans’ committees in December, Mr. Wilkie said veterans largely liked using the department’s hospitals.
“My experience is veterans are happy with the service they get at the Department of Veterans Affairs,” he said. Veterans are not “chomping at the bit” to get services elsewhere, he said, adding, “They want to go places where people speak the language and understand the culture.”
Health care experts say that, whatever the larger effects, allowing more access to private care will prove costly. A 2016 report ordered by Congress, from a panel called the Commission on Care, analyzed the cost of sending more veterans into the community for treatment and warned that unfettered access could cost well over $100 billion each year.
A fight over the future of the veterans’ health care system played a role in the ousting of the department’s previous secretary, David J. Shulkin.CreditDoug Mills/The New York Times
Tricare costs have climbed steadily, and the Tricare population is younger and healthier than the general population, while Veterans Affairs patients are generally older and sicker.
Though the rules would place some restrictions on veterans, early estimates by the Office of Management and Budget found that a Tricare-style system would cost about $60 billion each year, according to a former Veterans Affairs official who worked on the project. Congress is unlikely to approve more funding, so the costs are likely to be carved out of existing funds for veterans’ hospitals.
At the same time, Tricare has been popular among recipients — so popular that the percentage of military families using it has nearly doubled since 2001, as private insurance became more expensive, according to the Harvard lecturer Linda Bilmes.
“People will naturally gravitate toward the better deal, that’s economics,” she said. “It has meant a tremendous increase in costs for the government.”
A spokesman for the Department of Veterans Affairs, Curt Cashour, declined to comment on the specifics of the new rules.
“The Mission Act, which sailed through Congress with overwhelming bipartisan support and the strong backing of veterans service organizations, gives the V.A. secretary the authority to set access standards that provide veterans the best and most timely care possible, whether at V.A. or with community providers, and the department is committed to doing just that,” he said in an email.
Veterans’ services organizations have largely opposed large-scale changes to the health program, concerned that the growing costs of outside doctors’ bills would cannibalize the veterans’ hospital system.
Dr. Shulkin, the former secretary, shared that concern. Though he said he supported increasing the use of private health care, he favored a system that would let department doctors decide when patients were sent outside for private care.
The cost of the new rules, he said, could be higher than expected, because most veterans use a mix of private insurance, Medicare and veterans’ benefits, choosing to use the benefits that offer the best deal. Many may choose to forgo Medicare, which requires a substantial co-pay, if Veterans Affairs offers private care at no charge. And if enough veterans leave the veterans’ system, he said, it could collapse.
“The belief is as costs grow, resources are going to shift from V.A. to the private sector,” he said. “If that happens on a large scale, it will be extremely difficult to maintain a V.A. system.”

Trump Officials Say Drug Prices Are Inflated. So Are Some of Their Claims on a Solution.

by Robert Pear - NYT - December 16, 2019

WASHINGTON — In his zeal to fulfill a campaign promise, President Trump has correctly identified high drug prices as a major problem for many Americans. But in defending his proposed solutions, he has sometimes stretched the facts.
Mr. Trump has proposed that Medicare pay for certain prescription drugs based on the prices paid in other developed countries. He called this “a revolutionary change” and said it would save money for the government and for Medicare beneficiaries without hurting their ability to get the medicines they need.
As part of a demonstration project covering half the country, Medicare would establish an “international pricing index” and use it to calculate a “target price” for each drug covered by Part B of Medicare. The proposal is expected to produce “a 30 percent reduction in Medicare spending” for drugs included in the test, the Department of Health and Human Services said.
The new pricing model, unveiled less than two months ago, has encountered a torrent of criticism from drug companies, which benefit from high prices under the current system, and from conservative groups, which accuse Mr. Trump of trying to import price controls from foreign countries.
Part B of Medicare spends roughly $30 billion a year for drugs that patients receive in doctor’s offices and outpatient hospital clinics — often by infusion or injection — for cancer, rheumatoid arthritis, macular degeneration and other conditions. Some of the drugs cost more than $100,000 a year. Many are biologic drugs made from living cells.
What was said
U.S. drug companies voluntarily cut the price” of drugs overseas far below what they charge in the United States “for the exact same drug.”
— The Trump administration, in statements this fall.
Mr. Trump is right that brand-name drugs often cost much more in this country than in Europe. But it is a stretch to say that drug companies voluntarily provide discounts abroad. They generally charge lower prices to ensure that their products will be covered by national health systems in other countries.
Medicare does not use its leverage in that way. As a candidate, Mr. Trump said Medicare should directly negotiate prices with drug makers, a proposal long favored by Democrats. But since taking office, he has dropped the idea.
Most of the 36 countries in the Organization for Economic Cooperation and Development “regulate pharmaceutical prices directly or indirectly through coverage determinations,” the group said in a report last month.
Daniel Hartung, an associate professor at the Oregon State University College of Pharmacy, explained: “Many O.E.C.D. countries have single-payer systems in which the government is essentially setting prices and telling companies what it will pay for coverage. That’s how they can extract substantial reductions relative to prices paid in the United States.”
Mr. Trump is proposing to use prices in 14 other countries as a benchmark or guide in deciding what Medicare would pay. The administration acknowledged that some of these countries, like the Czech Republic and Greece, “have far lower per capita incomes than the United States.”
Several of the 14 countries have a budget for spending on prescription drugs. Many peg their payments to drug prices in other countries, a practice known as reference pricing or international benchmarking. Some of the countries assess the “cost-effectiveness” of drugs and limit how much they will pay for expected gains in the length and quality of life, with some exceptions allowed.
Just seven months ago, the Trump administration criticized the use of reference pricing by other countries, but it has now proposed something similar for Medicare.
What was said
“The president is also going to bring smart negotiation to billions of dollars’ worth of drugs in a part of Medicare where there is currently no negotiation at all.”
— Alex M. Azar II, the secretary of health and human services, in May
What was said
“In Medicare Part B today, the government gets the bill, and we just blindly pay it — oh, plus a 6 percent markup for the provider who administers it. There is no negotiation.”
Mr. Azar in October
It is true that the government does not negotiate with drug manufacturers to determine the prices paid for drugs in Part B of Medicare. But the prices paid for many of those drugs do reflect the results of competition and negotiations in the private sector.
Under the Medicare Modernization Act of 2003, the government’s payment for a Part B drug is based on the drug’s “average sales price.” This price, as defined in the law, accounts for commercial discounts, rebates and other price concessions that drug manufacturers negotiate with health insurance plans, pharmacy benefit managers and other private purchasers.
These price concessions, generally treated as trade secrets, may knock 15 to 35 percent off the list price of a drug.
The problem for Medicare and for consumers is that, for some drugs, manufacturers do not give substantial discounts. This may be the case, for example, if a drug has no direct competitors, so doctors cannot prescribe an alternative, or if the market for a drug outside Medicare is small.
“For at least 30 percent of Part B spending, Medicare prices are at least half of the market, meaning there is effectively no competition within that substantial federal spending among competing products,” said John O’Brien, the senior adviser on drug pricing at the Department of Health and Human Services.
What was said
“This model will expand patient access, through lower prices. This is a pro-patient-access model. We are going to lower drug prices substantially, for our most costly drugs, without restrictions on patient access.”
Mr. Azar in October
Under Mr. Trump’s proposal, Medicare payment for physician-administered drugs would be based, in part, on prices in other countries, including some that restrict access to drugs by limiting coverage.
The administration assumes that Medicare can pay lower prices without limiting access. This assumption is based on a belief that drug manufacturers could not walk away from the Medicare market because it is so large, with 55 million people in Part B.
Moreover, Medicare officials say they would monitor the use of prescription drugs to ensure that beneficiaries’ access to medicines is not compromised. Even with the pricing index, they say, Medicare would still be paying more than the average of other countries.
But some advocates for patients are apprehensive.
“We share the administration’s goal of reducing prescription drug costs,” said Christopher W. Hansen, the president of the advocacy arm of the American Cancer Society, but the proposal “raises numerous questions about beneficiary access.”
“For instance,” Mr. Hansen said, “how would patients access necessary care if there are no vendors willing to bring drugs to physicians in their area? What if the drug maker decides not to sell a particular drug at the price required under the proposal, and patients are unable to get the Medicare-covered drugs they need to treat their disease?”
Dr. Debra Patt, a breast cancer specialist at Texas Oncology, a group of more than 400 doctors, asked: “What leverage would a vendor have to bring manufacturers to the table? Suppose a manufacturer is selling drug X for $1,000, and the vendor wants to pay only $750. What if the manufacturer says no? What then happens to Medicare beneficiaries?”
Robert Pear has been a domestic correspondent in the Washington bureau since joining The Times in 1979. He currently covers domestic policy, the budget, health care and Social Security. 


Court Rejects Trump’s Cuts in Payments for Prescription Drugs

by Robert Pear - NYT - January 7, 2019

WASHINGTON — A federal court has rejected President Trump’s first major effort to cut payments for prescription drugs, saying the administration went far beyond its legal authority.
The Trump administration made a “drastic departure from the statutorily mandated rates” when it reduced payments to hospitals for drugs given to Medicare beneficiaries in outpatient clinics, Judge Rudolph Contreras of the Federal District Court here said in the decision, issued late last month.
Alex M. Azar II, the secretary of health and human services, “may not end-run Congress’s clear mandate,” the judge said.
The court is still considering how to compensate hospitals for the money lost, estimated at $1.6 billion for last year. The cuts are still in effect, but the court has asked the government and hospitals to propose a remedy.
At issue is a federal program that allows hospitals serving large numbers of low-income people to get discounts from drug manufacturers on certain prescription drugs, including many used to treat cancer and H.I.V./AIDS.
Medicare pays for the drugs when Medicare beneficiaries receive them as outpatients at more than 1,000 hospitals that participate in the program. The Trump administration concluded that Medicare was paying hospitals much more than they spent to acquire the drugs.
So federal officials cut the reimbursement rate last year — to 77.5 percent of a drug’s average sales price, from 106 percent.
Hospital executives told the judge that as a result of the reductions, they would have to cut back or eliminate some services.
Under the Medicare law, Judge Contreras said, federal officials have the power to “adjust” reimbursement rates. But, he said, they abused that power and “fundamentally altered the statutory scheme established by Congress for determining” reimbursement rates.
Mr. Azar “may either collect the data necessary to set payment rates based on acquisition costs, or he may raise his disagreement with Congress,” but he may not circumvent the mandate of Congress, said Judge Contreras, who was appointed by President Barack Obama. The government had acknowledged that it did not know the precise amount of the difference between what hospitals were paying for the drugs and what Medicare was reimbursing them.
The program, created under Section 340B of the Public Health Service Act, is commonly known as the 340B program.
Caitlin Oakley, a spokeswoman for Mr. Azar, said Monday: “We are disappointed with the court’s ruling and are evaluating next steps. As the court correctly recognized, its judgment has the potential to wreak havoc on the system.”
Ms. Oakley said the decision could increase costs for Medicare patients, who are generally responsible for 20 percent of the Medicare-approved amount for outpatient drugs covered by the program. Most people on Medicare have supplementary insurance, like a Medigap policy or retiree health benefits, to help pay their share of the bill.
The lawsuit challenging the Medicare cuts was filed by the American Hospital Association; by two trade groups representing teaching and public hospitals; and by three providers: Henry Ford Health System, based in Detroit; Park Ridge Hospital, in Hendersonville, N.C.; and Eastern Maine Healthcare Systems, now known as Northern Light Health.
Dr. Robert A. Chapman, a medical oncologist at Henry Ford Health System, described the administration’s action as an example of “reverse Robin Hood.” Under the policy, he said, the government took money from hospitals serving large numbers of low-income people and redistributed most of it to hospitals that did not qualify for the program.
When Medicare cuts its payments to hospitals, Dr. Chapman said, it tends to offset the discounts that hospitals receive from drug manufacturers.
Melinda R. Hatton, a senior vice president and the general counsel of the American Hospital Association, said the court was “holding the administration’s feet to the fire to comply with the law.” Hospitals use savings from the program to pay for myriad services in low-income communities, she said.
In a speech in May in the Rose Garden, Mr. Trump announced what he called “the most sweeping action in history to lower the price of prescription drugs for the American people.” He persuaded some pharmaceutical executives to roll back or postpone price increases over the summer.
And at a campaign rally in October in Wisconsin, Mr. Trump said: “You will see, very soon, drug prices will go plunging downward. You wait, you watch.”
But drug makers have increased prices on hundreds of products this month, provoking an angry reaction from the president.
In a Twitter post over the weekend, Mr. Trump said: “Drug makers and companies are not living up to their commitments on pricing. Not being fair to the consumer, or to our Country!”
Many of those commitments were carefully hedged and temporary. Pfizer, for example, said in July that it was rolling back price increases to give Mr. Trump time to work on his “blueprint to lower drug prices.”
Pfizer said then that its prices would remain at the lower level until the president’s blueprint took effect or until the end of 2018, “whichever is sooner.”
Members of Congress from both parties, including Speaker Nancy Pelosi and Senator Charles E. Grassley, Republican of Iowa, said they were hoping to work with Mr. Trump to rein in drug prices. But so far, Trump appointees have generally expressed more interest in unilateral administrative actions than in legislative solutions.

Bill Would Create Health Care System For Mainers

by Associated Press - January 14, 2019


AUGUSTA, Maine - A Democrat's bill would create a new health care system for Maine residents.  The Legislature referred Sen. Geoff Gratwick's bill Wednesday to its Health Coverage, Insurance and Financial Services committee.
Gratwick served on a task force last year tasked with creating plans to provide health coverage for all Maine residents. The committee released a report urging improved oversight over pharmacy benefit managers and prescription drug costs.
Gratwick's bill would rely on funding sources from payroll taxes, transaction taxes and other available federal funding. All Mainers could enroll on a voluntary basis for a benefit plan covering essential health benefits. Medicaid recipients would be automatically enrolled.
But more details about the bill, which is in concept form, are likely to be hashed out in legislative committee if the legislation moves forward.