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This Week in Health Care Reform: June 2nd, 2017

With lawmakers out of town, staffers keep the health care reform fires burning; new research highlights the role that chronic conditions play in driving up overall health spending; the prescription drug pricing trend continued its inexorable march to unsustainability last year; and, one state broadens its commitment to telehealth.

Week in Review

Replacement Bill: Despite the rough legislative terrain in which they now find themselves, policymakers in the Senate remain undeterred in their efforts to pull together a health care replacement bill that they can advance.  And, even with the members themselves back in their home states for the Memorial Day recess, Senate staffers are hard at work drafting legislation for their bosses to react to when they return to Washington next week.  It’s against this backdrop, however, that leaders have adopted a somewhat measured tone when talking about next steps, as uncertainty surrounding what needs to be included in the bill in order to generate enough support for it to pass persist.  Meanwhile, stakeholders continue to weigh in, highlighting provisions of the existing health care framework that lawmakers would do well to keep intact.  Driving their urgency is the rampant uncertainty threatening to unravel the individual market.

Chronic Conditions: A new study seeks to shine a spotlight on exactly how the (comparatively) small population of patients with serious health conditions drives a disproportionate amount of health care spending.  Released by the RAND Corporation, the analysis shows that 12 percent of people with five or more chronic conditions account for over 40 percent of total health care spending.  Perhaps most worryingly, the authors point out, is the fact that six-in-ten American adults reported suffering from at least one chronic condition.

Rx Drug Prices:
Much has been made of pharmaceutical companies’ seemingly inexhaustible ability to hike up the price of their products.  A new report now shows just how dependent these manufacturers have become on these out-of-control drug prices for growth.  According to an analysis by Credit Suisse, increases in the prices of drugs added some $8.7 billion to the net income of more than two dozen companies last year.  And, that trend has shown no sign of abating, as 40 drug price increases were observed in the first quarter of this year, up from the 33 seen during the same period in 2016.  Unsurprisingly, that data only portends the likely continuation of what’s steadily been measured as a year-to-year occurrence, as reinforced by a separate study which measured the growth of prescription drug costs last year at 8.77 percent – the fourth consecutive year drug prices have gone up.  By comparison, the Consumer Price Index – which measures the average change in prices of household goods – increased just 2.1 percent in 2016, which, according to the analysts, means drug prices inflated 318 percent more than the price of all other goods.

Lone Star State:
Even as technological advancements continue to reshape the contours of health care delivery in this country, challenges remain.  New estimates project the global digital health care market to reach approximately $280 billion by 2021, largely on the demand for IT solutions that are driven by the growing need to reduce health care costs while also meeting regulatory requirements.  With so much capital flowing into this sector, stakeholders are clamoring for much-needed guidance and regulation, especially in the field of telehealth, where issues – including a lack of data, interoperability challenges, and segmented interests – continue to pose obstacles.  So, as our system slowly warms to the possibility offered up by the integration of new technologies into how and where and when patients interact with their health care, more jurisdictions have eased the restrictions governing telehealth’s adoption.  For instance, this past weekend, the state of Texas signed into law a bill that will pave the way for the expansion of these services.  The new law allows doctors to provide remote care to patients without having first conducted an in-person visit, essentially bringing to an end the contentious years-long debate standing in the way of telehealth’s widespread utilization in Texas.  In addition to broadening the state’s definition of telehealth to include video, the law importantly requires that these services be paid like any other covered service.      

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