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This Week in Health Care Reform - April 15th, 2016

Spending on prescription drugs reaches a new high; telehealth evolves into a mainstream service; and, the uninsured rate reaches a new low.


Week in Review

Rx Spending: Trend analysis continues to draw attention to the unsustainable trajectory that prescription drug spending has taken in this country.  And, a new report released this week only serves to reinforce the need for stakeholders to work together in finding a solution.  According to the research arm of IMS Health, total spending on prescription drugs rose 12.2 percent in 2015 to a record $425 billion.  While slightly decelerated from 2014’s observed 14.2 percent increase, last year’s growth was still well above the average seen over the past decade.  The report goes on to predict that spending will continue to rise at a steady rate through 2020, when it’s expected to hit as much as $640 billion.  The U.S. now accounts for 40 percent of worldwide spending on drugs.  Broadly, drug spending keeps growing as a result of a number of factors, including, rising prices, less generic competition for blockbuster drugs, and the increased uptake in prescriptions being filled.  The latest analysis from IMS Health comes amid growing criticism and increased scrutiny of unaffordable drug prices from doctors, patients, insurers, lawmakers, and regulators, who have all expressed the need to rein in these out-of-control costs.

Telehealth Integration:
Once thought of as an outlying way-station along the traditional health care delivery pathway, telehealth has quickly established itself as more than just a fringe benefit.  In fact, according to a new survey from REACH Health, the majority of health care organizations are working to integrate telehealth services into their care delivery models.  Roughly two-thirds of respondents to the survey indicated that telehealth was the top or one of the highest priorities for their organizations.  For these organizations, incorporating telehealth into the decision-making matrix is “rapidly moving from individual departments and specialties to an enterprise initiative,” said Steve McGraw, President and CEO of REACH Health.  However, despite telehealth’s evolution from a specialty-centric offering to a mainstream service, impediments remain, including, reimbursement and systems limitations, as cited by survey respondents.

According to the latest Gallup poll, the uninsured rate is now at its lowest level since the firm began tracking the metric in 2008.  Having declined significantly (6.1 percentage points) since 2013, the uninsured rate leveled off in 2015, as the focus began to shift to capturing the remaining uninsured.  The analysis lands in the midst of a heated Presidential campaign, although exactly how important an issue health care is for voters largely depends on who’s being asked.

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Looking Ahead

Despite entrenched views on the Affordable Care Act, outside the political atmospherics, public opinion on the health care law’s impact on access to health care has begun to thaw.  Whether or not that represents a warming trend, however, remains to be seen.

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