New, Comprehensive 340B Regulations Proposed
The Health Resources Services Administration under HHS issued 90 pages of proposed 340B regulations last week. In many ways, these regulations are similar to legislation proposed, but withdrawn, in Congress a couple of months ago. The proposal defines everything from a covered entity, eligible beneficiaries, contracts with pharmacies and how audits will be conducted. Most major health care associations on both sides of the issue have not taken a position on the regs. Most have stated they are thoroughly reviewing the proposal. There are more than 11,500 health care organizations participating in 340B today. Click here for our team’s 4-page summary with links to the regulation. Comments are due to HRSA by October 27.
Moody’s, Fitch Boost Ratings for Not-for-Profit Hospitals
For the first time in six years, Moody’s Investors Service last week upgraded its assessment of the financial outlook for the national U.S. nonprofit health care sector to stable. The outlook had been negative since 2008. By the numbers, Moody’s said, average national operating cash flow in the sector increased to 12.3 percent in 2014, following several years of flat growth. It also cited Medicaid expansion, last winter’s strong flu season and pent-up demand among the newly insured as factors. Click here for the Moody’s announcement.
- Median operating profitability for U.S. not-for-profit hospitals showed strong gains over the past year, though growth in operating cash flows show the credit gap widening between higher- and lower-rated borrowers, according to Fitch Ratings in a new report. Click here for details.
Hospital Readmission Avoidance May Be Overstated: Study
Even as the government claims preventable hospital readmissions have dropped, a dramatic increase in hospitals’ use of observation status and emergency care in lieu of readmission suggests many providers are gaming the quality standards, according to a report in Health Affairs. Observation stays jumped 96 percent between 2006 and 2013, accounting for more than half of the decline in Medicare admissions, according to MedPAC data. Moreover, about one in 10 hospital stays within 30 days of an earlier discharge are classified as “observation,” according to CMS. Click here for this interesting report.
Big Majority of Medicare ACOs Not Getting Payment Bonuses: CMS
Only 92 of 333 Medicare Shared Savings Program (MSSP) ACOs operating in 2014 will receive payments for their success and recoup some portion of their investment, according to an analysis of CMS data on ACOs released last week. While the number of ACOs with positive results and the total dollar savings have increased due to the additional 100-plus ACOs that were added to the program, the average savings per ACO actually declined . The total savings returned to 92 ACOs in 2014 was $341 million compared to $315 million to 52 ACOs in 2013. Hundreds of organizations with thousands of doctors, hospitals and other healthcare providers have invested over $1.5 billion of their money in the ACO program to date but they have received only $656 million total in return. CMS has in turn received over $848 million in savings for a small investment. Click here for the CMS fact sheet. Click here for the release from the national ACO association. Click here for a great CMS resource with links to detailed financial data for all ACOs.
Primary Care Docs Says Growing Use of Quality Data Having a Negative Impact
More than half of primary care physicians surveyed say the growing use of quality metrics to assess provider performance is having a negative impact on quality of care. According to the survey, physicians say that metrics don’t give the whole story, confusing health information technologies and new care delivery systems are among the challenges clinicians contend with—and they’re growing increasingly disgruntled and concerned about effects on patient care. Click here for complete survey results.
CMS Names ED Doc as ICD-10 Trouble-Shooter; Results of Testing Released
Emergency room physician William Rogers, who currently serves as director of the Physicians Regulatory Issues Team at CMS, was announced last week as the agency’s ICD-10 ombudsman. The agency also revealed on a national provider call that its new ICD-10 Coordination Center in Baltimore will begin operating at the end of September. The goal of the center, which is in the process of building up its staff, will be to “manage and triage issues” relating to the massive code switch from ICD-9. CMS also announced the results of its final round of ICD-10 Medicare fee-for-service end-to-end testing, which took place from July 20-24. Click here for a one-page summary of those results.
Study: Hospital Billing, Collecting Practices Unfair
A new report out last week in the AMA Journal of Ethics says that IRS regulations for hospitals on billing and collections practices aimed at protecting patients were deemed unfair in a study reviewing the practices of facilities in 14 states. Differences in requirements for nonprofits versus for-profit and government-run hospitals, in addition to hospital discretion to determine financial assistance eligibility, don’t live up to the goals of the Affordable Care Act. Click here for the study.
There Is Very Limited Medicare Advantage Plan Competition: Study
Using a standard measure of market competition, a new Commonwealth Fund analysis finds that 97 percent of markets in U.S. counties are highly concentrated and therefore lacking in significant MA plan competition. Competition is considerably lower in rural counties than in urban ones. Even among the 100 counties with the greatest numbers of Medicare beneficiaries, 81 percent do not have competitive MA markets. Market power is concentrated among three nationwide insurance organizations in nearly two-thirds of those 100 counties. Click here for the study.
New Cholesterol Drug Gets FDA OK – at $14,000 a Year
Amgen received FDA approval last week of its drug Repatha, the second high-priced cholesterol-lowering treatment representing an improvement over widely used statin medicines. Amgensaid it will price the drug at $14,100 each year, just under the $14,600 pricetag of its competitor, Praluent. Last week’s approval is likely to set off intense price negotiations among payers, who’ve warned that this new class of drugs, known as PCSK9 inhibitors, could bankrupt the system if used too widely. Click here for the FDA announcement. Click here for the NYTimes story.
- Public health advocates, including members of a presidential advisory committee, have been urging the Obama administration to push back against states’ Medicaid policies restricting access to new high-cost hepatitis C treatments, but the administration has been “noncommittal,” according to a NYTimes report last week. Click here.
TeleHealth Adoption Continues Rapid Growth
This year continues to be a breakout one for doctor video visits: CVS Health announced last week that it is working with three established remote visits companies: American Well, Doctor On Demand, and Teladoc, to expand its telehealth capabilities and services. Click here for the story.
Veterans’ Access to Psychiatrists Not Improving Much: Inspector General
The Veterans Affairs Department “has not been fully effective” in its hiring practices or its use of existing personnel to improve veterans’ access to psychiatrists, according to a report released last week by the VA inspector general. The report follows up on a similar study released in April 2012 that found that the VA’s “mental health performance data is not accurate or reliable” and first-time patients were not receiving timely mental health evaluations. Click here for the report.
“Cadillac” Tax May Impact High Number of Employees: Study
A new analysis released last week by the Kaiser Family Foundation estimated that just over a quarter of employers that offer health plans would pay the 40 percent “Cadillac” tax in 2018 on at least one plan if they don’t make changes. The National Business Group on Health, a nonprofit association of large employers, found that half of its members reported that at least one of their health plans would trigger the tax in 2018. Both groups predicted that the proportion of employers affected would go up significantly over time. Many members of Congress are working to repeal the tax. Click here for the Washington Post story.
Use of Narrow Networks Growing on State Exchanges
Narrow networks dominate at least three-quarters of plans sold on the Obamacare exchanges in four states, according to an analysis released last week. And in a dozen other states, at least half of plans also are marked by narrow networks. The analysis by University of Pennsylvania researchers — who defined the issue as plans that include 25 percent or fewer providers in an area — comes amid continuing concerns over network adequacy. Click here for the report.
Another Co-Op Health Plan To Close
The Nevada Health Co-Op created with Obamacare funding will shut down its operations at the end of the year, the non-profit insurer’s board announced last week. The Nevada plan will become the third co-op insurer to shutter its operations this year. CoOportunity Health, which used to operate in Iowa and Nebraska, was the first, and the Louisiana Health Cooperative announced last month that it will fold at the end of the year. The Nevada insurer lost nearly $15.3 million in 2014, according to NAIC filings. In the first six months of this year, the plan posted losses of more than $30 million. Click here for more from Nevada Health.
New Study Says Docs’ Overnight Sleep Deprivation Doesn’t Hurt Quality
Going without sleep the night before does not affect the performance of doctors doing elective surgery the next morning, according to a new study that runs contrary to research demonstrating that sleep-deprived physicians pose a hazard to patients. The odds of having a surgery-related problem were 22.2 percent when the doctor had been treating patients between midnight and 7 a.m. and 22.4 percent when the doctor had, presumably, received sufficient sleep. Click here for more.
FDA Warns Cigarette Makers About Marketing Language
The FDA issued warnings to the makers of Natural American Spirit, Winston and Nat Sherman cigarettes, saying that the brands could not be marketed as “additive-free” or “natural.” In three separate letters made public last week, the F.D.A. told the manufacturers of the brands that they did not have the agency’s approval to claim that their products were free of certain harmful substances, or that they posed less risk to consumers than other tobacco products. Click here for the FDA announcement.
Most Young School Kids Are Vaccinated But Pockets of Unprotected Remain: CDC
The vast majority of U.S. kindergarten-age children are vaccinated against preventable diseases but sizable pockets of unprotected children still exist, posing a public health threat, according to a government study released last week by the CDC. Only 1.7 percent of U.S. parents of kindergartners sought exemptions in 2014 from laws requiring children be vaccinated. Rates vary nationwide, however, with at least one state reporting over 6 percent of parents seeking exemptions. Click here for the CDC report.
FDA Announces Decision on Naming of Biosimilars
Biosimilars will be given distinct non-proprietary names from the branded biologics they are near copycats of, the FDA indicated last week in a proposed rule. The FDA said all biologic reference products and their biosimilars will share the same core drug substance name, but to better identify each drug, every product — including the reference products — will get a unique FDA-designated suffix composed of four lowercase letters. The proposal is designed to prevent inadvertent substitution of biologic products that are not determined to be interchangeable and to make it easier to track the safety and usage of the drugs once they are on the market, the agency said. Click here for the FDA proposed rule.
Another Study Says Benefits of Fish Oil Ingredients Are Questionable
A new NIH study is poking more holes in the claimed benefits of omega-3 fatty acids found in fish oils, one of the most popular dietary supplements on the market. Though some research says the supplement helps with brain health, a five-year study of 4,000 patients found that the omega-3 fatty acids didn’t slow cognitive decline in the elderly. It comes amid fishy evidence that omega-3 fatty acids lower the risk of heart disease, as some claim. Click here for the NIH report.
Docs Are Among Best Paid Professionals in U.S.
Surgeons, psychiatrists and primary care physicians are the three highest-paid professions in the United States, according to the CareerCast’s 2015 list of Top 10 best paying jobs. Using annual median wages reported by the Bureau of Labor Statistics, CareerCast found that surgeons topped the list with an “annual median wage” of $352,220, followed by psychiatrists at $181,000, and PCPs at $180,180. All three of the medical disciplines were expected to see a wage “growth outlook” of 18% through 2022. Click here for details.