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This Week in Health Care Reform - November 21st, 2014

Open enrollment gets off to a less rocky start the second time around; drug R&D finds itself in the spotlight; digital health comes to a crossroads; and, regardless of what the Supreme Court decides, the health care law finds itself imperiled.


Week in Review

Take Two: As expected, the second open enrollment period began last Saturday to considerably less fanfare than last year’s inaugural launch.  While officials, who had spent the days and weeks leading up to the event collectively holding their breath, were finally able to exhale, that’s not to say the rollout was without its bumps.  After a weekend of steady consumer interest, people attempting to access their accounts on on Monday afternoon received messages telling them the site was either experiencing heavy volume or was undergoing improvements.  Despite those hiccups, however, federal officials feel confident that those discrepancies were merely the exception, citing the 1 million people who had successfully managed to access the site over the weekend as proof of a smoother experience.  Whether or not that proves to be the case, it certainly can’t hurt the Affordable Care Act’s public image, which, according to the latest Gallup poll, has never been worse.  While it remains to be seen just how effective the enhancements to the website ultimately prove to be, some are beginning to think that the biggest obstacle still in front of the health care law has less to do with technology and more to do with sentiment. 

Drug R&D: It’s become impossible for any substantive discussion on what’s driving health care costs to not eventually turn to the rising price of drugs.  Already, we’ve seen what distinct classes of drugs – such as specialty and orphan – are threatening to do to the health care cost curve.  Taken as a whole, worldwide drug spending is expected to hit $1.06 trillion this year, before eventually ballooning to $1.3 trillion in 2018.  A separate analysis of the average price of brand name drugs compared to general inflation goes on to show a wildly disproportionate acceleration to what we’re spending on drugs year-to-year.  The pharmaceutical industry has long pointed to the R&D costs associated with bringing these drugs to market as justification for their pricing decisions.  (According to a new study, the cost of drug development has more than doubled over the past eleven years.)  However, a growing body of research has begun to poke holes in this defense, estimating that drugmakers are, in fact, spending just a fraction of their revenues on developing new treatments.  Still, the industry maintains that the high cost of drug development is to blame for higher drug prices, citing the more complicated clinical trials associated with bringing these medicines to market as a major contributing factor.  Unfortunately for them, newly-surfaced evidence, reported by Newsweek this week, uncovered a disturbing trend at play in the pharmaceutical industry, namely, that a significant amount of negative data from drug clinical trials is purposefully hidden from the public and the medical community, influencing the systematic reviews which, ultimately, guide treatment decisions. 

Digital Health:
A lot of attention has been paid to what the midterm election results mean for a wide array of issues.  Energy and immigration have already found themselves center-stage.  And, it’s looking like they, along with health care, will continue to drive the congressional conversation in the next legislative session.  But, practically speaking, what does the future hold for digital and telehealth?  While progress on those other items often falls victim to the partisanship that comes from being such politically polarizing issues, just about everyone can find something they like when it comes to the application of technology to the delivery of health care.  Even as the Administration continues to defend the Affordable Care Act in the courts, stakeholders have identified telehealth as an imperative in realizing true health care reform.  That’s not to say, though, that widespread adoption is without its challenges.  For one, there’s growing concern that at least one group of beneficiaries may not be ready to embrace telehealth.  Also, somewhat ironically, there are rumblings that health IT may, in fact, end up tying up primary care physicians, reducing their capacity.  And, while generally seen as forward progress, the recent inclusion by the Centers for Medicare & Medicaid Services (CMS) of new telehealth reimbursement codes has some worried about the pitfalls in the road ahead.  

Now that the Supreme Court has decided to hear the case challenging the Affordable Care Act’s exchange subsidies, there’s mounting concern amongst supporters that the court’s decision, without even having to overturn it, could wind up severely undermining the law.  Still, some political optimists see the coming turbulence as an opportunity for a bipartisan conversation on next steps for health care reform.  But, more pragmatic observers note that, given the extremities of the partisan divide preventing any kind of political comity from gaining traction in Washington, both sides would do well to proceed with an abundance of caution.

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Looking Ahead

With the second open enrollment period underway, there are a handful of outstanding issues to keep in mind regarding the health care law’s future.  And, now that lawmakers have returned to Washington, what can we reasonably expect them to accomplish before the 113th Congress adjourns? 

With Thanksgiving upon us, there will not be a newsletter next week.  But, we'll be back on the other side of the holiday.  Until then, you can keep up with the latest by following the Health Action Network on Twitter and by liking us on Facebook.

Have a safe and happy Thanksgiving!