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This Week in Health Care Reform - April 1st, 2016

Stakeholders wait to see what changes lay in store for Medicare Advantage; an innovative pricing scheme for prescription drugs gains traction; a state-by-state look at the state of telehealth; and, a new analysis profiles the remaining uninsured population.


Week in Review

Medicare Advantage Decision: As has been covered here, the efforts to protect the popular Medicare Advantage program, which currently serves over 17 million American seniors and persons with disabilities, have become something of an annual ritual.  Every year around this time, the Centers for Medicare & Medicaid Services (CMS) proposes changes to the program’s underlying funding structure.  In recent years, those changes, in combination with the cuts exacted on Medicare Advantage by the Affordable Care Act, have served to degrade the comprehensive and coordinated care that has distinguished the program from traditional fee-for-service Medicare, leaving an already vulnerable beneficiary population exposed to disruption in the care they so desperately depend upon.  In anticipation of CMS making its latest round of proposed cuts final, stakeholders across the health care spectrum have rallied to Medicare Advantage’s defense.  Lawmakers, too, have demonstrated an unprecedented level of bipartisan support for the program, with more than 400 members of Congress having sent multiple letters to CMS urging the agency to protect beneficiaries from further cuts.  Health Action Network members have also responded, with hundreds of letters of their own going out to these lawmakers and asking for their continued support.  CMS is expected to announce its final decision regarding its latest proposed changes to Medicare Advantage on the other side of the weekend.

Indication-Specific Rx Pricing:
With so much attention being paid to the issue of escalating prescription drug prices, it’s hardly surprising that the spotlight would eventually find its way to the question of what should these drugs cost?  On the surface, a drug’s efficacy would seem to be one of the more important determinants of that medicine’s price, but in the world of pharmaceutical pricing, that’s not the case.  For instance, if a drug is shown to be effective treating one form of cancer, but less so at treating a different form of cancer, it stands to reason that the price would be lower for that latter course of treatment.  However, generally speaking, a one-size-fits-all approach to drug pricing has traditionally been the rule of thumb.  But, now there’s a new drug pricing scheme that may upend the balance.  Known as indication-specific pricing, this approach would set different prices for the same drug based on the extent to which that specific medicine is effective at treating multiple conditions, in essence, shifting the cost burden from one of paying per pill to one of paying per outcome.  It’s important to note, though, that while the concept is slowly finding traction, there remain a number of obstacles in its path.  But, experts agree that, given the price trajectory of prescription drugs, any attempt to establish the true worth of a given treatment would be welcome.

State of Telehealth: Earlier this month, Indiana became the latest state to ease the rules governing the expanded use of telehealth services, passing legislation that would allow the limited use of prescriptions by doctors who haven’t seen a patient in person.  With technology expanding at an exponential pace, regulators find themselves with the difficult task of ensuring that the expanded use of these advances in the delivery of health care services reconciles with the overarching need to protect patients.  Unsurprisingly, with each state having its own established rules and governance, telehealth continues to find varying levels of adoption across the country.

Uninsured Population:
Last week, enrollment projections for the Affordable Care Act were lowered by the Congressional Budget Office (CBO).  According to CBO, about 12 million Americans are expected to have coverage through the health care law by the end of this year, down about 1 million from its latest prediction, just three months prior.  As provisions of the law continue to come online, the health care industry has been able to gain greater insight into this expanding patient population.  And, with 33 million individuals remaining without coverage, a new analysis explores the characteristics of the uninsured.

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