Drug Bill Research Articles

Dr. René Favaloro

Dr. René Favaloro

PHP151 Evidence on the Impact of Managed Entries on Payers, Patients, Manufacturers, and Health Care Workers

Managed entries (MEs) are innovative pricing and reimbursement agreements aiming to share the risk related to the introduction of new, high-cost drugs between the payer and the manufacturer. This study aims to review evidence on the impact of MEs on payer, patients, manufacturer, and health care workers and to analyse emerging trends in managed entries at international level. A systematic literature review (grey and peer-reviewed) was performed complemented by search of health technology assessment agency's websites and selective interviews with decision makers in key European countries. Evidence exists of improved cost-effectiveness and lower drug price following the implementation of coverage with evidence development in Sweden. Data from France shows that price-volume agreements led to rebates totalling around 3% of the total drugs bill. Evidence from Italy shows that authorization with a risk-sharing agreement was associated with more rapid patient access in comparison to authorization without such an agreement. It is unclear whether managed entries constitute a reward for manufacturers, however, various benefits have been reported such as reimbursement for drugs which received an initial negative recommendation (e.g. bortezomib and trabectedin, UK) and competitive advantage in the form of better formulary position (sitagliptin & sitagliptin + metformin, USA); not to mention the possibility of granting discounts while leaving list prices untouched. Considerable administrative burden is placed on health care staff due to the diversity of existing schemes, the complexities linked with retrospective reimbursement, and lack of management capacity at current staffing levels. Although evidence on the impact of MEs is patchy, the systematic literature review showed that there are already lessons to be learnt. Preliminary findings seem to suggest that MEs have indeed the potential of meeting payer, patient, and manufacturer expectations, yet important threats such as implementation difficulties, administrative burden and lack of management capacity need to be addressed.

Universal Pharmacare Could Cut up to $10.7 Billion from Canada's Annual Drug Bill

Universal Pharmacare Could Cut up to $10.7 Billion from Canada's Annual Drug Bill

Obama's health law at six months: survival is not assured

Six months after President Barack Obama’s landmark health care law, free preventive care is taking effect for millions more Americans, children have new insurance protections and seniors are getting more help for their drug bills, all down payments on an unfolding and historic transformation of

Diabetes in the UK: time for a reality check?

Diabetes in the UK: time for a reality check?

Managing the high cost of newer oral agents in type 2 diabetes

AbstractOver recent years there has been a significant number of new drugs launched for the management of diabetes. While this is good news for patients with the condition it has the potential to put significant pressure on the drugs bill. In this Expert Panel Discussion the participants discuss the rising cost of diabetes management and the impact of new drugs. In particular they discuss the NICE estimates for the cost of implementation of recent guidance on use of new drugs and how this guidance can be implemented most cost‐effectively.

The challenge of developing new therapies for irritable bowel syndrome

The challenge of developing new therapies for irritable bowel syndrome

The value of a specialist lipid clinic

To establish the value of the first 3 years of a cardiovascular risk factor clinic in tackling the major risk factors for cardiovascular disease (CVD). A database review of all 339 patients referred to the clinic. Blood pressure levels in the hypertensive patients were significantly reduced and 9% of the smokers managed to quit for 12 months, half of them subsequently relapsing. Ninety-eight oral glucose tolerance tests were performed and 40% were abnormal yielding 10 patients with hitherto unsuspected diabetes and 29 with impaired glucose tolerance. Sixty-four of the 97 referrals of patients in the primary prevention group (no evidence of CVD) were found to have calculated Framingham coronary heart disease risk estimates of < 15% per decade, the lowest being 0.3%. Lipid levels were significantly reduced in both the hypercholesterolaemic (n = 290) and hypertriglyceridaemic (n = 49) patient groups through the use of more potent statins, extensive use of combination therapy and appropriate use of fibrates and omega-3 fish oil supplements. The annual drug cost per patient treated only increased from 310.72 pounds sterling to 398.08 pounds sterling, yet there was a 3.5-fold increase in the number of patients achieving the General Medical Services 2 target of a total cholesterol < 5 mmol/l and a 4.5-fold increase in patients achieving the Joint British Societies 2 target of a low-density lipoprotein (LDL) cholesterol < 2 mmol/l. The need for a specialist clinic was demonstrated by the 66% of primary prevention referrals who did not meet the current NICE treatment threshold. Additionally, the clinic was able to diagnose and treat 39 patients with undiagnosed diabetes mellitus/impaired glucose tolerance and 12 with hypothyroidism. LDL cholesterol was reduced overall by 36% implying a greater than one-third reduction in future cardiovascular events before the improvements in blood pressure control and smoking cessation are included and this was achieved at marginal extra cost to the mean drug bill at referral.

Randomised controlled trial of two brief interventions against long-term benzodiazepine use: Cost-effectiveness

Previous findings have indicated that a letter from a patient's General Practitioner (GP) and a short GP consultation leads to reduced intake among long-term benzodiazepine (BZD) users. To compare the cost-effectiveness and potential cost savings of these two brief interventions. Economic evaluation conducted alongside a prospective randomised controlled trial from the perspective of the NHS. A total of 273 long-term BZD users (=>6 mos) at seven general practices and regarded by their GPs as suitable to take part in the study within the Newcastle and North Tyneside District Health Authority were identified from repeat prescription computer records. Patients were randomised to usual GP care + assessment only or the offer of a short consultation (12 mins approx) with the patient's GP (or practice pharmacist/practice nurse) or a letter signed by the GP advising gradual reduction in BZD intake. Economic measures taken were: costs of intervention; savings (costs) of changes in health service use from before to after intervention; savings to the NHS from reductions in drug use and dispensing costs; total costs of brief intervention; simulations of savings (costs) extrapolated to the District Health Authority. The letter was the more cost-effective intervention when taking into account changes in health service use and savings to the drugs bill. If all GPs in Newcastle and North Tyneside screened long-term BZD users on their lists and sent the letter studied here to those considered suitable to receive it, it is estimated that savings to the District Health Authority would be a minimum of £4.9 million per annum. Routine implementation of the letter intervention in general practice throughout the UK would result in large financial gains to the NHS. These savings represent a conservative estimate of savings to the public sector, as wider savings to the social care system may also be expected as a result of the policy.

Fiscal and Generational Imbalances: An Update

This paper provides an update of the U.S. fiscal and generational imbalances that we originally calculated in Gokhale and Smetters (2003) and presents the calculations in several alternative ways. We find that a lot has changed in just a few years. In particular, the nation's fiscal imbalance has grown from around $44 trillion as of fiscal year-end 2002 to about $63 trillion, mostly due to the recent adoption of the prescription drug bill (Medicare, Part D). The imbalance also grows by more than $1.5 trillion (in inflation adjusted terms) each year that action is not taken to reduce it. This imbalance now equals about 8 percent of all future gross domestic product (GDP) and it could, in theory, be eliminated by more than doubling the employer-employee payroll tax from 15.3 percent of wages to over 32 percent immediately and forever--assuming, quite critically, no reduction in labor supply or national saving and capital formation. Massive cuts in government spending would also be required to achieve fiscal balance: the total federal fiscal imbalance now equals 77.8 percent of non-Social Security and non-Medicare outlays.

A Review of Data on the U.S. Health Sector: Summer 2005

This report presents information on the state of the U.S. health sector in late summer 2005. It includes data on the uninsured and underinsured and their access to health care, on socioeconomic inequalities in health care, and on the rising costs of health insurance. It also presents information on the role of corporate money in health and health care, focusing on the pharmaceutical and hospital industries. The authors include an update on Medicare HMOs and the prescription drug bill, the results of some recent public opinion polls on health care, and some international comparisons of health systems. The article ends with recent data on health (medical) savings accounts and high-deductible insurance plans.

Drug Bills And Medicare Part D

Letters Health AffairsVol. 24, No. 6: Rethinking Health Reform Drug Bills And Medicare Part DJack RodgersPUBLISHED:November/December 2005No Accesshttps://doi.org/10.1377/hlthaff.24.6.1690AboutSectionsView articleView Full TextView PDFPermissions ShareShare onFacebookTwitterLinked InRedditEmail ToolsAdd to favoritesDownload CitationsTrack CitationsPermissions View articleTOPICSMedicare Part DMedicare savings programsMedicare eligibilityPayment Loading Comments... Please enable JavaScript to view the comments powered by Disqus. DetailsExhibitsReferencesRelated Article Metrics History Published online 1 November 2005 InformationCopyright 2005 by Project HOPE - The People-to-People Health Foundation, Inc.PDF download

A Review of Data on the U.S. Health Sector Fall 2004

This report presents information on the state of the U.S. health sector in late 2004. It includes data on the uninsured and underinsured and their access to health care, underinsurance for long-term care and mental health, and the rising costs of health insurance and health care. The author presents data on the increasing social inequalities in health and access to health care; the role of corporate money in health and health care; and the hospital and pharmaceutical industries. The article also includes updates on the consequences of the Medicare prescription drug bill and the state of Medicare spending, and seniors' spending, on drugs; the results of some recent public opinion polls on health care; information on labor, labor unions, and health insurance; and some international comparisons of health insurance. The article concludes with some useful sources of information on single-payer, universal health care.

Adoption of celecoxib and rofecoxib: a nationwide database study

Cyclooxygenase 2-selective non-steroidal anti-inflammatory drugs (NSAIDs, coxibs) are recommended primarily for patients at high risk of gastrointestinal bleeding, most of them being elderly. Our objective was to describe and analyse patient- and physician-related factors affecting the adoption of celecoxib and rofecoxib 2 years after their launch in Finland. Retrospective analysis of the nationwide Prescription Register. Physicians who had issued at least 200 reimbursed prescriptions in 2002 (n = 12 033, 80% of working-age Finnish physicians) were involved in the analysis. Excluding patients with rheumatoid arthritis (RA), almost one-fifth (18%) of NSAIDs prescriptions were for coxibs. In patients with RA the share was 25%. The share of coxib prescriptions of all NSAIDs increased with age of the patient. Over one half (58%) of coxib prescriptions were issued for patients under 65 years of age. Specialists in physical and rehabilitation medicine were the fastest adopters of coxibs: one-third of their NSAID prescriptions in 2002 were for coxibs. Primary care physicians were the most conservative both in adopting and favouring coxibs. Coxibs have gained the status of standard prescription NSAIDs within a few years. Their use should be restricted to patients who could benefit most from the use. Routine prescribing of expensive new drugs increases the drug bill without additional health gain.

A Review of Data on the U.S. Health Sector March 2004

This report presents information on the U.S. health sector in early 2004. It provides data on the insured and uninsured and their access to health care; the increasing costs of care; the increasing social and economic inequalities in health and health care; and the role of corporate money in health care. The author then presents data on the recently passed Medicare prescription drug bill and some updates on Medicare HMOs. The article also includes updates on state legislative action, recent opinion polls on health care conducted among physicians and the general public, and health plans proposed by the presidential candidates (as of early 2004).

Guiding older adults through the maze of medicare prescription drug benefits.

Geriatric Nursing Volume 25 Number 3 Nurses working with older adults are responsible for planning interventions that facilitate their adherence to appropriate medication regimens. Because of the increasingly high cost of prescription drugs for older adults, nurses often need to address financial limitations as a barrier to adhering to medication regimens. In December 2003, Congress passed legislation that will give all Medicare beneficiaries access to prescription discount cards beginning June 1, 2004, and to some prescription drug coverage beginning in 2006. The legislation is very complex, and older adults have been bombarded with information about a confusing array of prescription benefit discount plans. Gerontologic nurses and other health care practitioners need to be familiar with these plans because they must educate older adults and their families about the most cost-effective ways to obtain prescribed medications. It is important to know that the major provisions of the Medicare drug bill do not take effect until Jan 1, 2006, and details of this plan are still being developed. Some of the highlights of the bill that nurses need to know now are: • Although the new Medicare drug benefit plan will not be implemented until 2006, Medicare-endorsed discount cards will be effective between June 1, 2004, and Dec 31, 2005. • Enrollment in any plan is voluntary. • The new drug plans will be most beneficial to people who have low incomes or annual overall drug Guiding Older Adults Through the Maze of Medicare Prescription Drug Benefits

Mixed potential impact on endoscopy centers of medicare bill

The Medicare Prescription Drug Bill signed into law December 8, 2003 included a number of provisions that will impact endoscopy centers and other ambulatory surgery centers (ASCs) in the years ahead. These amendments carry both negative and potentially positive impacts for the Medicare ASC program.In joining forces with the American Society for Gastrointestinal Endoscopy and other ASC organizations, the AGA helped thwart the Medicare Payment Advisory Commission’s (MedPAC) recommendation that the facility fee for any ASC procedure, which under current law exceeds what a hospital outpatient department (OPD) receives for the same procedure, be immediately reduced to the OPD rate. As most GI codes are paid at higher rates in the ASC than the OPD, rejection of the MedPAC proposal prevented reimbursement cuts for GI procedures of between $30 and $50.However, Congress did elect to establish cost-of-living adjustments at the consumer price index minus 3% for 2004, with no update for the period 2005 through 2008. Because the CPI for the relevant period was 3%, it is likely that ASCs will receive no increase in the coming year. However, ambiguity remains as to how the Centers for Medicare and Medicaid Services (CMS) will determine the CPI for purposes of the update and over what base period CMS will use to make the adjustment. Remaining unclear is whether CMS will make adjustments to the rates that were in effect on March 31, 2004, or the rates that were in effect on September 30, 2003.Congress provided guidance to CMS regarding the re-basing of ASC facility fees. The legislation eliminates the requirement that CMS recalculate ASC facility fees on the basis of a cost survey of ASCs. This is likely to be good news for gastroenterologists. When CMS last attempted to re-base rates, it proposed to reduce rates for GI procedures by between 9% and 27%. Under congressional mandate, the General Accounting Office must conduct a study of the relationship between hospital and ASC costs and rates and establish a new rate system by January 2008. As the new legislation requires CMS to implement the new rates in a budget-neutral manner, it effectively prohibits CMS from lowering overall ASC spending when implementing the new payment rates. AGA officials say they “will continue to be vigilant in representing the interests of endoscopic ASCs as these activities are undertaken.”Stories by Les Lang The Medicare Prescription Drug Bill signed into law December 8, 2003 included a number of provisions that will impact endoscopy centers and other ambulatory surgery centers (ASCs) in the years ahead. These amendments carry both negative and potentially positive impacts for the Medicare ASC program. In joining forces with the American Society for Gastrointestinal Endoscopy and other ASC organizations, the AGA helped thwart the Medicare Payment Advisory Commission’s (MedPAC) recommendation that the facility fee for any ASC procedure, which under current law exceeds what a hospital outpatient department (OPD) receives for the same procedure, be immediately reduced to the OPD rate. As most GI codes are paid at higher rates in the ASC than the OPD, rejection of the MedPAC proposal prevented reimbursement cuts for GI procedures of between $30 and $50. However, Congress did elect to establish cost-of-living adjustments at the consumer price index minus 3% for 2004, with no update for the period 2005 through 2008. Because the CPI for the relevant period was 3%, it is likely that ASCs will receive no increase in the coming year. However, ambiguity remains as to how the Centers for Medicare and Medicaid Services (CMS) will determine the CPI for purposes of the update and over what base period CMS will use to make the adjustment. Remaining unclear is whether CMS will make adjustments to the rates that were in effect on March 31, 2004, or the rates that were in effect on September 30, 2003. Congress provided guidance to CMS regarding the re-basing of ASC facility fees. The legislation eliminates the requirement that CMS recalculate ASC facility fees on the basis of a cost survey of ASCs. This is likely to be good news for gastroenterologists. When CMS last attempted to re-base rates, it proposed to reduce rates for GI procedures by between 9% and 27%. Under congressional mandate, the General Accounting Office must conduct a study of the relationship between hospital and ASC costs and rates and establish a new rate system by January 2008. As the new legislation requires CMS to implement the new rates in a budget-neutral manner, it effectively prohibits CMS from lowering overall ASC spending when implementing the new payment rates. AGA officials say they “will continue to be vigilant in representing the interests of endoscopic ASCs as these activities are undertaken.” Stories by Les Lang

Medicare and premium support: a social work perspective.

For more than a decade, conservatives, led by Heritage Foundation, have sought to replace current traditional Medicare, with its defined package of benefits, with a so-called premium support system modeled after Federal Employee Health Benefits Program (FEHBP) (Lieberman, 2001). According to Robert Moffit, director of domestic policy studies at Heritage Foundation, FEHBP provides the personal choice, effective cost control, flexibility, and capacity for innovation that lawmakers should include when they fix broken program (quoted in Heritage Foundation, 2003). The FEHBP provides coverage to some 8 million individuals (U. S. Office of Personnel Management [OPM], 2003). Its members select from among a wide range of plans with varying benefits, and government pays up to 75 percent of weighted premium average of participating plans (U.S. General Accounting Office [GAO], 2002, p. 4). A beneficiary who chooses a higher cost plan must make up difference between value of premium support and cost of plan, whereas an individual who chooses a lower cost plan breaks even or pays a smaller amount (Oberlander, 2000). In theory, this encourages consumers to consider their choices carefully and forces insurers to compete for enrollees by reducing costs. In June 2003 House of Representatives took a major step toward realizing conservative vision by enacting Prescription Drug and Modernization Act of 2003 (H.R. 1), which adds a long-sought prescription drug benefit to Medicare. Included in H.R. 1 is a provision that would require traditional to compete with HMOs and other private plans beginning in 2010. H.R. 1 has gone to a conference committee, which will try to reconcile it with a prescription drug bill enacted by Senate. Whether or not H.R. 1 survives intact, conservatives are clearly committed to turning into a system resembling FEHBR A majority of members of National Bipartisan Commission on Future of (1999) supported a premium-support approach. Representative Bill Thomas (R-CA) (2003), chair of House Ways and Means Committee and a chair of Bipartisan Commission, has expressed strong support for an FEHBP model. In addition, President Bush has pointed to FEHBP as a model for an Enhanced Medicare (Strengthening Medicare,' 2003). MEDICARE AND THE FEHBP In supporting an FEHBP approach for Medicare, conservatives make two points. First, with number of workers in relation to retirees declining and approaching retirement of baby boomers, faces a deepening crisis;' that requires fundamental change (Owcharenko, 2003). Second, only rational way of fixing mess is by reorganizing it along lines of FEHBP, which, largely through consumer choice and real market competition;' has become one of most successful employer-based health insurance programs in world (Owcharenko). Although first point overlooks that does not exist in a vacuum and that its problems reflect a larger crisis in our health care system, it contains an element of truth (Moon, 2003). The number of workers supporting each beneficiary will fall, and Hospital Insurance Trust Fund (Medicare Part A) could run out of funds by 2026 (Centers for and Medicaid Services, 2003). fails to provide benefits included in most plans, most notably prescription drug coverage, and has high cost-sharing requirements (Reinhardt, 2003). Even defenders of traditional acknowledge need for change (Moon, 2003; Oberlander, 2000). The more important question is whether FEHBP has been as successful as its advocates claim and really offers an appropriate model for reforming Medicare. To begin with, FEHBP does not seem quite free-market system conservatives suggest it is. …

A Perspective on New Zealand??s Medicines Regulatory Environment

This paper is a broad review of the regulatory system applied to therapeutic products in New Zealand. The responsibilities and procedures of the Health Authority, Medsafe, are described. Medsafe applies a risk category approach to the processing of applications to market new medicines. Medsafe also works closely with the pharmaceutical industry and the Advertising Standards Authority in the development of a guiding authority to allow direct-to-consumer advertising of prescription medicines. The subsidization of medicines by government is administered by PHARMAC. This government agency uses strategies such as reference pricing and sole supply tendering to reduce the country’s drug bill. The overall effect of this agency’s policies is to create a generic industry which is perceived as hostile to innovative companies. This has an impact on patients and on the amount of investment by the industry in research and development. Unless this negative climate is altered, New Zealand is likely to be disadvantaged in the development of its fledgling biotech industry — one of the major growth areas of the twenty-first century.

Medicare Agrees to Reimburse Telehealth Psychiatric Interviews

Back to table of contents Previous article Next article Government NewsFull AccessMedicare Agrees to Reimburse Telehealth Psychiatric InterviewsKate MulliganKate MulliganSearch for more papers by this authorPublished Online:20 Sep 2002https://doi.org/10.1176/pn.37.18.0002There is a trickle of good news about Medicare, although the glass isn’t yet half full.On June 28 the federal government’s Centers for Medicare and Medicaid Services (CMS) approved the inclusion of psychiatric diagnostic interviews as a reimbursable telehealth service under its updated physician fee schedule. The expansion will be effective January 1, 2003.The addition came about as the result of APA’s argument to CMS that an initial diagnostic interview is necessary for effective psychiatric treatment to take place. CMS previously had permitted reimbursement for psychiatric telehealth services, but had not included a code for diagnosis.William S. Herz, M.D., co-chair of the APA Caucus of Rural Psychiatrists, told Psychiatric News, “This recent action corrects a significant, although apparently accidental, omission in the original reimbursement authorization.”He said that the addition should be helpful at rural mental health centers that already have been able to set up telehealth programs, but noted that there are still considerable obstacles for many of those centers to billing Medicare successfully.Medicare Appeals ProcessMedicare beneficiaries are also one step closer to establishment of a national appeals process, as a result of a lawsuit filed August 6.The suit came about because CMS reversed a decision made in October 2001 to allow Medicare reimbursement for a treatment for macular degeneration using the drug verteporfin (Visudyne). In March, when CMS announced its reversal of that ruling, Medicare beneficiaries attempted to appeal and were told that the agency didn’t have appropriate regulations in place.The American Association of People With Disabilities, American Council of the Blind, Gray Panthers, and Medicare beneficiaries then sued CMS because it had not established a process for beneficiaries to appeal the decision.NCDs Can Be ChallengedThe legal grounds for the suit are in the Medicare, Medicaid, and SCHIP Benefits Improvement Act of 2000 (BIPA). Section 522 of BIPA says that “any aggrieved party” can challenge a Medicare National Coverage Determination (NCD).NCDs are decisions about Medicare reimbursement that are binding throughout the country.According to the AMA, CMS has issued fewer than 200 NCDs, but in recent years they have become more common.The law stipulates that challenges to NCDs should be reviewed by the Departmental Appeals Board of the Department of Health and Human Services. The appeals process was to be in place by October 1, 2001.According to the September 2 American Medical News, CMS Administrator Thomas Scully said, “Unfortunately, when Congress enacted the provisions addressing appeals, it did not provide additional funding to the Medicare program for the associated costs. Consequently, this has caused some delays in implementing this new process.”On August 22, just a couple of weeks after the suit was filed, CMS published a proposed regulation for NCD appeals in the Federal Register.Chester W. Schmidt Jr., M.D., chair of APA’s Committee on RBRVS, Codes, and Reimbursements, told Psychiatric News, “Certainly, it is good news that Medicare beneficiaries will finally have an opportunity to appeal NCDs, particularly since those decisions are becoming more common and affect large numbers of patients and physicians.”APA’s Division of Government Relations is preparing to submit comments to CMS on the proposed regulation.On June 28 CMS published in the Federal Register a proposed regulation that would change the productivity adjustment factor. That factor is used to help determine the impact of inflation on the cost of physician supplies and services. It is a key element in the formula that CMS uses to determine Medicare’s physician payment rates.The result of the change would be to decrease the current estimate of the 2003 pay update from a 5.4 percent cut to a 4.4 percent cut.The failure of the House of Representatives and Senate to agree on a prescription drug bill stalled other efforts to improve the physician payment schedule.HR 4954 included a three-year fix of the physician update formula in addition to adding a prescription drug benefit. The legislation would have resulted in a payment increase of about 2 percent for physicians treating Medicare patients for each of the next three years.Congress adjourned for its August recess before the two chambers reached agreement on prescription drug benefits or physician payment under Medicare.According to the August 19 American Medical News, Sen. Max Baucus (D-Mont.), chair of the Senate Finance Committee, said that he wanted the panel to vote on physician payment legislation as soon as possible after the Senate returned to work in September.More information on the proposed appeals process is posted on the Web at www.psych.org/pub_pol_adv/medicare082702.cfm. ▪ ISSUES NewArchived