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Author Archives: Tom
May17
0

President Trump’s Plan to Help Lower Cost For Medicare Part D Recipients

By Tom Matteson - blog

 

This is a great article by Roy Avik from Forbes, outlining how the Trump Administration is trying to help with Medicare Part D drug costs

 

 Avik Roy , Forbes Staff
05-14-2018

WASHINGTON, DC – MAY 11: U.S. President Donald Trump listens to Health and Human Services Secretary Alex Azar deliver remarks during an announcement about drug prices in the Rose Garden at the White House May 11, 2018 in Washington, DC. Trump announced a ‘blueprint’ for lowering the cost of perscription medications. (Photo by Chip Somodevilla/Getty Images)

On Friday, in the White House Rose Garden, President Trump announced a comprehensive new effort to lower drug prices. The hot take is that the new plan will achieve little, because it doesn’t ask Medicare to directly negotiate drug prices. But the hot take is badly misinformed. The Trump plan, if enacted, represents a sea change in pharmaceutical pricing policy, one that will have a significant effect on drug prices in the future.

Medicare already negotiates drug prices

There’s long been a myth out there that within the Medicare prescription drug program, also known as “Part D,” Medicare doesn’t negotiate drug prices. But Medicare does negotiate drug prices, and has done so since the program was created in 2003.

As the Congressional Budget Office put it in a 2014 report, “The competitive structure of Part D gives plan sponsors significant incentive to hold down spending…sponsors use three main approaches: They encourage the use of less-expensive brand-name drugs, they negotiate lower prices for brand-name drugs, and they encourage the use of generic drugs.” (Emphasis added.)

This negotiating process is why Part D spending has come in massively under budget, representing the most successful cost-control experiment in Medicare’s history.

Medicare Part D spending has come in massively under budget.

Recommended by Forbes
  When Medicare Part D was enacted in 2003, people on the left complained that it administered the program through private insurers and PBMs. They wanted Part D to be a government-run, single-payer program, and have long agitated for Part D to be changed in this way. That’s what people mean when they talk about Medicare directly negotiating drug prices. But the Congressional Budget Office has repeatedly evaluated this idea, and concluded that the effect would be “limited” and “modest,” because Part D plans already negotiate on Medicare’s behalf.

Congressional action on drug pricing

The Trump plan involves two categories of reform: things the administration can do unilaterally, and things that it will call on Congress to enact. Friday’s release focused mainly on unilateral actions, but the Congressional piece is arguably more important, and has gone underappreciated by many observers. As the President put it, “These [unilateral] reforms are just the beginning. In the coming weeks, we will work with Congress to pass legislation that will save Americans even more money at the pharmacy. For that, we need the help of Congress, and we think it will be forthcoming.”

In particular, the Trump administration has proposed limiting the growth of Medicare payments for drugs administered in the doctors’ office—under Medicare Part B—to consumer inflation (CPI). This simple change could save taxpayers tens of billions of dollars over time, and curb the ability of drug companies to exploit the system by instituting double-digit price increases every year for old drugs.

Similarly, the administration is proposing shifting some, if not all, drugs out of Part B into Part D, in order to increase the number of drugs that fall under Part D’s negotiating process. And the administration is considering rolling back mandates that force Medicare to keep costly drugs on its formularies, regardless of their value.

Ideally, the Trump administration will also persuade Congress to revisit two laws that have driven up the cost of prescription drugs: the Orphan Drug Act of 1983, which allows companies with no intellectual property to charge exorbitant prices for drugs meant to treat rare diseases; and the Biologics Price, Competition, and Innovation Act of 2009, which has not done enough to encourage competition for off-patent biotech drugs.

What the Trump administration will do on its own

On Friday, the administration released a 44-page blueprint for executive action on drug pricing entitled “American Patients First.” The blueprint represents the most comprehensive, serious, and thorough effort by any presidential administration to address the problem of high prescription drug prices.

That doesn’t mean it’s perfect. There are plenty of areas where the blueprint can improve. But it considers many good ideas for addressing the problem of high prices, including:

  • Reforming the FDA’s internal procedures in order to reduce artificial barriers to generic competition.
  • Promoting the use of biosimilars (i.e., generic biotechnology drugs) and reducing barriers to their take-up.
  • Preventing branded drug manufacturers from gaming FDA risk management strategies and 180-day generic launch rules to forestall generic competition.
  • Providing avenues for Medicare to bulk-purchase costly drugs so as to limit the pricing power of monopolies.
  • Requiring drug rebates negotiated by PBMs to be passed directly on to the patients using those drugs, instead of being used to reduce premiums for all policyholders. This should incentivize more and wider use of rebates, because price-sensitive consumers will benefit from lower prices on the drugs they themselves use.
  • Requiring drug companies to disclose list prices for their drugs in television ads, just as they do for side effects and other drug risks. This should make companies think twice about charging egregious prices, knowing that there will be a PR blowback.

Where the Trump administration has the wrong idea

The HHS blueprint justly recognizes the key factor in bringing drug prices down: increasing competition. But it gets distracted with other, more political goals that won’t do anything to make medicines more affordable to taxpayers.

The blueprint complains a lot about “high list prices for drugs”; that is to say, the “sticker price” that drug companies charge. But the sticker price isn’t what matters. What matters is the actual price, net of rebates and wholesaler discounts, that Americans pay. Getting that net price down should have been a greater focus of HHS’ efforts.

On a related note, the blueprint complains about “high and rising out-of-pocket costs for consumers.” Consumer costs are indeed rising, but not just for out-of-pocket payments. Spending on insurance premiums is also rising. The HHS blueprint engages in some faulty actuarial math by advocating measures that will cap out-of-pocket costs for seniors, in ways that actually incentivize the use of costlier drugs, thereby driving up Part D premiums and taxpayer spending on Medicare drugs.

Finally, the blueprint wastes several pages complaining about “foreign governments free-riding off of American investment in innovation.” This is a nationalist canard, perhaps meant to help drug companies feel better about the blueprint’s other, tougher measures. The problem is not that other countries underpay for branded drugs; the problem is that the U.S. overpays. Pharmaceutical manufacturers are free to not do business with any country that is paying an unattractive price. The drug companies accept those prices because they still make money at those rates.

Where Trump should do more: Tackling monopolies

As I mentioned above, the Trump administration is doing a lot of good things to open up competition in the drug sector. Competition is the one thing that has been reliably proven to reduce drug prices.

But there are lots of diseases—particularly rare ones–in which there is only one drug approved by the FDA for treatment. If that one drug is patented, its manufacturer often exploits that fact to charge prices that would never fly in a true market. It is in these situations where more aggressive action is needed.

Capping growth of Part B drug prices at consumer inflation is a good first step. Rolling back formulary mandates, so that Medicare isn’t forced to pay for low-value drugs, is a second one. Here are some other ideas:

  • Borrowing the Swiss idea of creating a safe harbor for private insurers to jointly negotiate drug prices with a monopoly manufacturer in a given state.
  • Eliminating requirements that force Medicare to pay for all FDA-approved drugs (i.e., open formularies).
  • Allowing the FDA to fast-track drugs that would compete with established monopolies.
  • Allowing pharmacies to import a drug from other countries if the manufacturer of an off-patent, monopoly drug takes a double-digit price increase (i.e., a price increase greater than 10 percent).

President Trump and HHS Secretary Alex Azar promise that they’re only just getting started. The proof will be in the pudding.

May14
0

CMS is Protecting Access to Durable Medical Equipment in Rural Areas

By Tom Matteson - blog

CMS safeguards patient access to certain medical equipment and services in rural and other non-contiguous communities

Date
2018-05-09
Title
CMS safeguards patient access to certain medical equipment and services in rural and other non-contiguous communities
Contact
press@cms.hhs.gov

CMS safeguards patient access to certain medical equipment and services in rural and other non-contiguous communities
Interim final rule delivers relief to providers through increased fee schedule rates throughout 2018

On the heels of the Rural Health Strategy released yesterday, the Centers for Medicare & Medicaid Services (CMS) issued an interim final rule with comment period (IFC) to increase the fee schedule rates from June 1, 2018, through December 31, 2018, for certain durable medical equipment (DME) items and services and enteral nutrition furnished in rural and non-contiguous areas (Alaska, Hawaii, and U.S. territories) of the country not subject to the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program (CBP).

Today’s action aims to protect access to needed durable medical equipment in rural and non-contiguous areas that are not subject to the DMEPOS CBP, helping beneficiaries to maintain their health, mobility, and overall quality of life. Stakeholders have raised concerns about significant financial challenges the current adjusted DME fee schedule rates pose for suppliers, including many small businesses, and that the number of suppliers in certain areas continues to decline.

“This action will help Medicare beneficiaries in rural areas continue to access life-sustaining durable medical equipment, like oxygen equipment,” said CMS Administrator Seema Verma.

In 2016 and 2017, information from the DMEPOS CBP was used to adjust Medicare payments for certain DME and enteral nutrition in certain areas of the county where the CBP did not occur (“non-bid areas”). The CBP has not been implemented in rural areas comprising about half the volume of the volume of items and services furnished in non-bid areas subject to the adjustments. Beginning January 1, 2017, the fully adjusted fee schedule rates were on average 50 percent lower than the unadjusted rates in these non-bid areas based on the average reduction in payment for all of the items and services subject to the adjustments, weighted by volume.

In 2016, prior to the fully adjusted fee schedule rates going into effect, blended rates of 50 percent of the amount based on the competitive bid rates and 50 percent of the traditional fee schedule amounts were implemented for the transitional year period. Today’s action resumes these blended rates from June 1, 2018, to December 31, 2018, in rural and non-contiguous areas not subject to the CBP.

CMS is continuing to engage with stakeholders regarding the CBP, including the national mail-order program, and payment for items and services furnished in non-bid areas. Going forward, CMS will continue to review data and information about rates for DMEPOS items and services, as required under section 16008 of the 21st Century Cures Act. CMS intends to undertake subsequent notice-and-comment rulemaking to address the rates for durable medical equipment and enteral nutrition furnished in 2019 and beyond.

For more information on Durable Medical Equipment Fee Schedule, Adjustments to Resume the Transitional 50/50 Blended Rates to Provide Relief in Rural Areas and Non-Contiguous Areas (CMS-1687-IFC) or to submit a comment on or before July 9, 2018, please visit: http://www.regulations.gov.

May8
0

New Medicare Cards Are On The Way: How To Avoid Being Scammed

By Tom Matteson - blog
The federal government is delaying the mailing of new Medicare cards as it beefs up security measures. (Contributed photo/CMS)
The federal government is delaying the mailing of new Medicare cards as it beefs up security measures. (Contributed photo/CMS)
By Leada Gore
04/17/2018

Medicare officials are mailing out new identification cards as they beef up security measures while warning of possible scams.

Beneficiaries living in Delaware, Washington, D.C., Maryland, Pennsylvania, Virginia and West Virginia were scheduled to begin receiving their new Medicare ID cards in April. Instead, the new schedule has pushed the delivery date back to May.

“We are working on making our processes even better by using the highest levels of fraud protection when we mail new cards to current Medicare beneficiaries,” the Centers for Medicare and Medicaid Services said.

New Medicare enrollees will automatically receive the new card, regardless of where they live.

The change comes as Medicare officials are working to crack down on fraud. Previously, Medicare cards contained the holder’s Social Security numbers. The new cards remove the Social Security number and replace it with a new 11-digit randomly assigned number called a Medicare Beneficiary Identifier or MBI.

Medicare card scams

The planned mailout of new Medicare cards has scammers looking to cash in.

Here’s what to be looking out for, according to CMS:

Medicare will never call you uninvited and ask for personal or private information and you do not have to provide this information to receive a new card. The new Medicare card will be mailed automatically to beneficiaries.

Do not give out your Social Security number or new MBI to anyone who contacts you about your card. If someone asks you for your information, for money, or threatens to cancel your health benefits if you don’t share your personal information, hang up and call us at 1-800-MEDICARE (1-800-633-4227).

You can go here to sign up for an alert letting you know when your new card is mailed.

Once you get your new Medicare card, destroy your old Medicare card and start using your new card right away.

May2
0

Great Job Morgan!

By Tom Matteson - blog

MIC would like to congratulate Morgan Novak for qualifying for the 69th annual Future Masters Tournament in Dothan Alabama.  Great Job Morgan!

May1
0

Medicare trying to combat opioid use.

By Tom Matteson - blog

Opioid is not just impacting the younger generation it is also impacting the senior community.  Here is a great article written by the New York Times that dives into the subject

Written By

Jan Hoffman

March 27, 2018

 

Medicare officials thought they had finally figured out how to do their part to fix the troubling problem of opioids being overprescribed to the old and disabled: In 2016, a staggering one in three of the 43.6 million beneficiaries of the program’s drug plan had been prescribed the painkillers.

Medicare, they decided, would now refuse to pay for long-term, high-dose prescriptions; a rule to that effect is expected to be approved on April 2. Some medical experts have praised the regulation as a check on addiction.

But the proposal has also drawn a broad and clamorous blowback from many people who would be directly affected by it, including patients with chronic pain, primary care doctors and experts in pain management and addiction medicine.

Critics say the rule would inject the government into the doctor-patient relationship and could throw patients who lost access to the drugs into withdrawal or even provoke them to buy dangerous street drugs. Although the number of opioid prescriptions has been declining since 2011, they noted, the rate of overdoses attributed to the painkillers and, increasingly, illegal fentanyl and heroin, has escalated.

“The decision to taper opioids should be based on whether the benefits for pain and function outweigh the harm for that patient,” said Dr. Joanna L. Starrels, an opioid researcher and associate professor at Albert Einstein College of Medicine. “That takes a lot of clinical judgment. It’s individualized and nuanced. We can’t codify it with an arbitrary threshold.”

Photo

Mr. Zobrosky’s medication regimen is strictly monitored at home. He submits to random urine tests and brings his pills to his doctor to be counted.CreditEamon Queeney for The New York Times

Underlying the debate is a fundamental dilemma: how to curb access to the addictive drugs while ensuring that patients who need them can continue treatment.

The rule means Medicare would deny coverage for more than seven days of prescriptions equivalent to 90 milligrams or more of morphine daily, except for patients with cancer or in hospice. (Morphine equivalent is a standard way of measuring opioid potency.)

According to Demetrios Kouzoukas, the principal deputy administrator for Medicare, it aims to further reduce the risk of participants “becoming addicted to or overdosing on opioids while still maintaining their access to important treatment options.”

The Centers for Medicare and Medicaid Services estimates that about 1.6 million patients currently have prescriptions at or above those levels. The rule, if approved as expected at the end of a required comment and review period, would take effect on Jan. 1, 2019.

Dr. Stefan G. Kertesz, who teaches addiction medicine at the University of Alabama at Birmingham, submitted a letter in opposition, signed by 220 professors in academic medicine, experts in addiction treatment and pain management, and patient advocacy groups.

His patients include formerly homeless veterans, many of whom have a constellation of physical and mental health challenges, and struggle with opioid dependence. For them, he said, tapering opioids does not equate with health improvement; on the contrary, he said, some patients contemplate suicide at the prospect of suddenly being plunged into withdrawal.

“A lot of the opioid dose escalation between 2006 and 2011 was terribly ill advised,” Dr. Kertesz said. “But every week I’m trying to mitigate the trauma that results when patients are taken off opioids by clinicians who feel scared. There are superb doctors who taper as part of a consensual process that involves setting up a true care plan. But this isn’t it.”

Some two dozen states and a host of private insurers have already put limits on opioids, and Medicare has been under pressure to do something, too. Last July, a report by the inspector general at the Department of Health and Human Services raised concerns about “extreme use and questionable prescribing” of opioids to Medicare recipients. In November, a report from the Government Accountability Office took Medicare to task, urging greater oversight of opioid prescriptions.

If the rule takes effect, Mark Zobrosky’s experience could be a harbinger for many patients. Mr. Zobrosky, 63, who lives in the North Carolina Piedmont, takes opioids for back pain, which persists despite five surgeries and innumerable alternative treatments. He has an implanted spinal cord stimulator that sandpapers the edge off agony, and has broken four molars from grinding because of pain, he said. He receives Medicare as a result of his disability, including a private plan that pays for his drugs.

He submits to random urine tests and brings his opioids to his doctor to be counted every month. To prepare for mandatory reductions, his doctor has tapered him down to a daily dose equivalent of about 200 milligrams of morphine. (Mr. Zobrosky has a large frame; doctors say that opioid tolerance depends on many factors — one person’s 30 milligrams is another person’s 90.)

In February, Mr. Zobrosky’s pharmacist told him that his insurance would no longer cover oxymorphone. His out-of-pocket cost for a month’s supply jumped to $1,000 from $225, medical records show. “I can’t afford this for very long and I’m nervous,” he said.

A Medicare official who would speak only on background said that the limit for monthly high doses was intended not only to catch doctors who overprescribe, but also to monitor patients who, wittingly or not, accumulate opioid prescriptions from several doctors. When the dose is flagged, the pharmacist or patient alerts the doctor.

But it falls to pharmacists to be the bad-news messengers. James DeMicco, a pharmacist in Hackensack, N.J. who specializes in pain medications, said that negotiating opioid insurance rejections for patients was already “beyond frustrating.” He spends hours shuttling between doctors and insurers. “My heart goes out to patients because they feel stigmatized,” he said.

Dr. Anna Lembke, an addiction medicine expert at Stanford, sees merit in the intent of the proposed rule, if not its design.

“The C.D.C. declared a drug epidemic in 2011, which they unequivocally and rightly attributed to overprescribing,” she said. “Without external limits, I do not believe that prescribers will be able to limit their prescribing to the extent necessary to address this public health crisis.”

But, she added, Medicare also needed to establish a reasonable grace period to allow patients on high doses to taper down safely.

According to a draft of the rule, when a high-dose prescription is rejected, a doctor can appeal, asserting medical necessity — although there is no guarantee that the secondary insurer covering the drugs under Medicare would relent. A pharmacist may fill a one-time, emergency seven-day supply.

Opponents of the new limit say that doctors are already overwhelmed with time-consuming paperwork and that many will simply throw up their hands and stop prescribing the drugs altogether.

A delay or denial would put chronic pain patients — or those with inflammatory joint diseases, complex shrapnel injuries or sickle cell disease — at risk of precipitous withdrawal and resurgence of pain, doctors said.

The Medicare proposal relies on guidelines from the Centers for Disease Control and Prevention that say doctors should not increase an opioid to a dose that is the equivalent of 90 milligrams of morphine.

But experts say that Medicare misread the recommendations — that the C.D.C.’s 90-milligram red flag is for patients in acute pain who are just starting opioid therapy, not patients with chronic pain who have been taking opioids long-term. The acute pain patient, the guidelines say, should first be offered treatments like acetaminophen or ibuprofen. A short course of a low-dose opioid should be a last resort.

“We didn’t take a specific position on people who were already on high doses,” said Dr. Lewis S. Nelson, the chairman of emergency medicine at Rutgers New Jersey Medical School and University Hospital, who worked on the guidelines.

“We did say that established, high-dose patients might consider dosage reduction to be anxiety-provoking, but that these patients should be offered counseling to re-evaluate,” he added. “There is a difference between a C.D.C. guideline for doctors and a C.M.S. hard stop for insurers and pharmacists.”

Dr. Erin E. Krebs recently released a comprehensive study showing that patients with severe knee pain and back pain who took opioid alternatives did just as well, if not better than, those who took opioids. Nonetheless, she and seven others who worked on the C.D.C. guidelines signed the letter opposing the Medicare rule.

“My concern is that our results could be used to justify aggressive tapering or immediate discontinuation in patients, and that could harm people — even if opioids have no benefit for their pain,” said Dr. Krebs, an associate professor of medicine at the University of Minnesota.

“Even if we walk away from using opioids for back and knee pain, we can’t walk away from patients who have been treated with opioids for years or even decades now,” she added. “We have created a double tragedy for these people.”

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