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This Week in Health Care Reform - December 9th, 2016

National health spending growth is measured at its fastest clip in nearly a decade; meanwhile, global spending on prescription drugs is projected to explode; new resources highlight the importance of quality measurement and reporting as Medicaid expands; and, a recent survey underscores the need to improve care coordination for seniors managing chronic conditions.

Week in Review

National Health Spending: According to new data compiled by the Centers for Medicare & Medicaid Services (CMS) and published in Health Affairs, US health spending last year rose at its fastest rate since 2007.  Driven in large part by the combination of expanded access to care and high-priced specialty drugs, growth rose 5.8 percent to $3.2 trillion.  Following five years of historically low growth between 2009 and 2013, health spending picked up again in 2014, a trend that was carried through into last year.  Also, for the first time the federal government became the largest sponsor of health care, its share of health spending rising to 29 percent, up from 28 percent the year prior and 26 percent in 2013.  But, perhaps of greatest concern, the 9 percent growth seen in prescription drug spending, which, although slower than the 12.4 percent observed in 2014, was still greater than that of any other service last year, essentially accounting for one out of every ten dollars spent on health care in the U.S..
Global Rx Spending: Against that backdrop, new data was released this week projecting global spending on prescription drugs would hit $1.5 trillion by 2021.  While less than the nearly 9 percent spending growth seen in both 2014 and 2015, the 4 to 7 percent growth forecasted over the next five years still means up to $375 billion more in additional spending on top of the $1.2 trillion estimated for 2016.  The report goes on to predict an historically high average of 45 new drugs making their way to market each year.
Medicaid Quality:
Politics aside, Medicaid has established itself as an essential component of our health care ecosystem.  As its ability to provide care to a diverse swath of the population grows (to the tune of more than 70 million Americans), it’s become increasingly difficult to downplay just how valuable a role the program plays in strengthening the fabric of our society.  So, it’s hardly a surprise that enrollment in Medicaid managed care plans has seen an uptick.  Given its growing importance to so many constituencies (beneficiaries, health plans, states), heightened attention is being paid to how quality in Medicaid is measured and reported.  While states have enjoyed flexibility in designing their own quality measurement systems, new federal regulations released by CMS earlier this year established greater consistency, requiring states to develop quality rating systems that draw from a core set of measures while using common methodologies.  A just-released series of white papers from health insurer Anthem’s Public Policy Institute seeks to shine a light on the current landscape of quality measurement in Medicaid, as well as the extent to which state efforts to date have impacted the behavior of individuals, health plans, and providers.  While the initial analysis found little evidence one way or the other in terms of how Medicaid quality rating systems affect plan choice, the changes being implemented by CMS and the states underscore the need to better understand which strategies and measurements are most effective in engaging consumers and encouraging the consideration of quality in their plan decision-making process. 
Senior Care Coordination:
With a growing number of seniors now managing chronic health conditions, the need for better care coordination for this vulnerable population has never been greater.  Unfortunately, according to a new survey, less than one-third of these patients are currently receiving strong care coordination.  That study, released by CareMore in partnership with Harris Poll, found a distressing lack of coordination in care delivery for patients over the age of 65.  According to the results, despite the vast majority of respondents saying that they had been diagnosed with at least one chronic condition (85 percent), only 43 percent reported their providers having asked them about any other treatments they had been receiving.  The importance of care coordination in ensuring patient safety can’t be overstated, the study’s authors are quick to emphasize, as it minimizes the risks of harmful medication interactions and reduces duplicative tests and treatments.

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Looking Ahead

Post-election, one thing there’s general agreement on is the importance of realizing value in our health care system.  To some, that means a greater focus on cost control, an area in which states have shown themselves to be more than capable – a fact that hasn’t gone unnoticed by GOP leaders, who are urging states to take a lead role as the country figures out what’s next for health care.

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