April 2, 2018

HRSA Seeks More Authority to Change the 340B Program

In its Budget Justification to Congress, the Health Resources and Services Administration once again repeated its request that Congress to allow for a user-fee of 0.1 percent of the total 340B drug purchases paid by participating covered entities. HRSA also requested general regulatory authority to “allow HHS to set clear enforceable standards on participation on all aspects of 340B program and will help ensure compliance with 340B Program requirements,” leading many to believe that this indicates they may be considering changes to 340B patient and hospital-eligibility criteria. The Obama Administration included a patient definition in wide-ranging draft “mega-guidance,” but the Trump Administration pulled that guidance shortly after taking office. The 340B request begins on page 255 of the HRSA Budget Justification, click here.

  • In California, the Governor’s 2018-19 budget proposes to eliminate the use of the 340B Drug Pricing Program in Medi-Cal, the State’s Medicaid program, click here.
  • The prices of the 20 most commonly prescribed brand-name drugs for seniors have risen nearly 10 times more than the annual rate of inflation over the past five years, according to a congressional report released last week. Click here for the report.


Walmart to Acquire Humana? And other Major Merger Developments

Retail giant Walmart is in talks to acquire health insurer Humana for what experts claim could be as much as $37 billion, according to various press reports.  Such a deal would allow Walmart to integrate all of its health services, such as pushing Humana customers to purchase their drugs at Walmart stores and receive care at its in-store clinics. The acquisition could also give Walmart more leverage in negotiations with pharmaceutical companies for cheaper prices on drugs. Click here for the Wall Street Journal story (requires a subscription), or here for a synopsis from CNBC.

  • Ascension and Providence St. Joseph Health have reportedly put merger talks on hold while the health systems restructure as more medical care moves outside of hospitals. A merger between the two health systems would create the nation’s largest owner of hospitals. Click here for details.
  • Health care transactions announced this year have already reached more than $156 billion, amid a surge of activity across the health care industry, according to an analysis. If Takeda Pharmaceutical Co. moves forward to acquire rival Shire PLC, which has a market value of $45 billion, the sector’s year-to-date deals would rise well above $200 billion, the most for a first quarter in at least a dozen years.  Click here for more.
  • Amazon’s jump into the health care space is reshaping the market, click here.
  • CVS’ acquisition of Aetna is raising anti-competitive concerns from the American Antitrust Institute.  They’ve sent a letter to the Department of Justice.  Click here.
  • Bloomberg reports that across America there are thousands of people making the decision to go without health insurance, despite the benefits, click here.
  • Aetna announced last week that it will automatically provide pharmacy rebates to customers when they purchase their medicines, click here.

US News Releases its “Healthiest Communities List”

With Falls Church, VA topping the list, US News released its list of the top 500 of the Healthiest Communities in the US. The publication measures “crucial health-related components of society with the aim of empowering citizens, health care leaders and officials to make decisions about policies and practices that can improve health outcomes for all.” Looking at 3,000 counties nationwide on approximately 80 indicators across 10 categories that drive health outcomes as determined by a HHS Committee, the top five communities are – Falls Church, Virginia, Douglas County, Colorado, Broomfield County, Colorado,  Los Alamos County, New Mexico, and Dukes County, Massachusetts. To read the full list as well as each communities attributes, click here.

  • A new study looks at alternative places of service—retail clinics, urgent care centers, telehealth and ambulatory surgery centers (ASCs)—as well as emergency rooms (ERs), and evaluates changes in utilization, geographic and demographic factors, diagnoses, procedures and costs, click here.


Government Continues To Focus on Opioid Crisis  

Health and Human Services – HHS Secretary Alex Azar announced last week that two individuals have been appointed to lead the Department on combating the opioid crisis and prescription drug pricing. The recently confirmed Assistant Secretary for Health, Brett Giroir, M.D., will be responsible for coordinating HHS’ efforts to combat the opioid epidemic, and Daniel Best, who had been a CVS Health executive, will be Senior Advisor to the Secretary for Drug Pricing Reform. Click here for the announcement.

Centers for Disease Control and Prevention – According to new analysis from the CDC, the overdose epidemic is spreading geographically and increasing across demographic groups largely due to powerful synthetic opioids. Synthetic opioids, such as fentanyl, are up to 50 times more potent than heroin and and accounted for nearly 31 percent of all drug overdose deaths in 2016, based on 2015-2016 data from 31 states and Washington, D.C. Click here for the report.

Congress – The House Energy and Commerce Health Subcommittee announced a third legislative hearing on April 11to consider more than one dozen bills pertaining to coverage and payment issues as part of their overall effort to combat the opioid crisis. The Committee has made it known that it would like to pass a package of bills by Memorial Day. This is in addition to the $1 billion in new funding to combat the opioid crisis that was part of the Omnibus spending package. Click here for the announcement.

  • Blue Cross Blue Shield has adopted a policy stating that opioids should not be prescribed as first or second lines of pain therapy in most clinical situations.  Click here for the press release.


PhRMA Funded Study Shows ACOs Have Under-Performed Projections

A new analysis finds that the Medicare Shared Savings Program (MSSP) has performed considerably below the financial estimates from the CBO made in 2010 by more than $2 billion. In 2010, the CBO projection stated that MSSP would produce $1.7 billion in net savings from 2013 to 2016 however, according to a PhRMA funded study, the program has actually increased federal spending by $384 million over that same period. The study states that this discrepancy is due to the fact that  most ACOs have chosen the bonus-only model, which does not require participants to repay to CMS for spending above their target. To read the full study, click here.

  • HHS Secretary Azar says many of the department’s initiatives have been lackluster.  He wants to make more changes.  Click here for the report.


Top Democrats Request GAO Investigate Costs Of Medicaid Work Requirements

The Ranking Members of the House Energy and Commerce and Senate Finance Committees – Rep. Frank Pallone (D-NJ) and Sen. Ron Wydan (D-OR) – sent a letter last week to request the Governmental Accountability Office to investigate the administrative costs associated with Medicaid work requirements and other coverage limitations the Trump Administration is championing. Specifically, the two lawmakers requested in the letter for GAO to examine how federal and state money will be used to monitor and enforce new work requirements for Medicaid beneficiaries as well as other eligibility restrictions. They also ask that GAO look at “Section 1115 demonstrations to understand the impact these complex and restrictive policies may have on federal spending, state budgets, and the beneficiaries who depend on the Medicaid program.” Click here for the full letter.

Most Commonly Used Drugs by Seniors See Steep Increases

A new report by the minority staff of the Senate Homeland Security and Governmental Affairs Committee for Sen. Claire McCaskill (D-MO) found that the list prices for the top 20 most prescribed brand drugs in Medicare Part D have risen well above the pace of inflation in recent years. The report, released last week, states that the increases have given a sales boon for drug companies, even as total prescriptions for many of these medicines actually decrease. By looking at the list prices of medications, the study found that, on average, prices for the top 20 most commonly prescribed brand-name drugs in 2015 increased 12 percent every year for the last five years or ten times higher than the average annual inflation rate, with 12 of the 20 drugs saw an increase of more than 50 percent in a five year period, and six doubled or more in price. Click here for the report.


CMS Extends Data Submission Deadline for MIPS

CMS has given clinicians participating in the Merit-Based Incentive Payment System under the Quality Payment Program a few extra days, until April 3rd, to submit MIPS performance data. CMS points clinicians to use the new feature on the QPP website to submit the data. Participants provide data in four performance categories that make up the final score that determines what their payment adjustment will be. Click here for details on what to report, and here for the submission website.


CMS’ Innovation Center Continues to Evolve

MACRA was intended to accelerate widespread adoption of Advanced APMs, including through creation of the Physician-Focused Payment Model Technical Advisory Committee (PTAC), which was intended to facilitate the review of potential future APMs for adoption by clinicians. Meanwhile, the CMS Innovation Center (CMMI) has continued to refine its APM portfolio. A December 2017 final rule cancelled certain episode payment models, which will reduce the number of providers meeting QP status in 2018. On the other hand, CMMI launched MSSP Track 1+ this year and announced that the voluntary Bundled Payments for Care Improvement Advanced (BPCI Advanced) model will launch in October 2018. Click here for an excellent summary of the status of the government’s advanced payment models and where they may be headed.


Rural Hospital Shutdowns Require Communities to Take Care of Their Own
With 83 rural hospitals closed since 2010, rural communities are left with emergency health facilities. When Pioneer Community Hospital of Patrick in Virginia closed, the Smith River Rescue Squad had to step in and start ferrying patients 45 minutes to one hour to the nearest hospital. Hospital closures hit rural communities hard economically, and leave a void of emergency medical services. For more from CNBC, click here.

  • The CAH Coalition is actively working with Congress and federal agencies to best support the unique needs of Critical Access Hospitals. Click here to learn more about their work.


California AG Files Suit Against Sutter Health for Anti-Competitive Practices 

California Attorney General Xavier Becerra has filed a lawsuit last week against Northern California Hospital System Sutter Health, accusing it of engaging in anti-competitive practices that have lead to high health care costs in the northern part of the state. The lawsuit claims Sutter Health inflated costs with its requirement that insurers sign “all-or-nothing” contracts as well as setting excessively high out-of-network rates, preventing insurers from offering lower-cost options, and impeding transparency. The lawsuit was filed shortly after a study conducted by University of California-Berkeley researchers was released earlier in the week that found large health care price differentials between Northern and Southern California. The Department of Justice commissioned study found the average inpatient hospital procedure that costs about $131,000 in Southern California costs more than $223,000 in the north. Click here for the suit, and herefor the study.


Infectious Disease Deaths Are Falling

Infectious disease deaths are falling in the U.S. — but improvements aren’t happening across the board, according to a new report.  The bulk of deaths were from one cause. More than 4 million people in the U.S. died of infectious diseases between 1980 and 2014. Lower respiratory infections were the most common cause, accounting for roughly 79 percent of those deaths. Deaths from tuberculosis and meningitis fell over the past few decades. Diarrheal diseases were the only type of infectious disease that saw death rates rise. Click here for the JAMA Network report.


FDA to Undertake a Multi-Year Nutrition Campaign

In a speech at the Consumer Federation of America’s National Food Policy Conference last week, FDA Commissioner Scott Gottlieb announced the start of a multi-year Nutrition Innovation Strategy that will take “a fresh look at what can be done to reduce preventable death and disease related to poor nutrition.” The campaign will include: modernizing the FDA’s review of product health claims; finalizing the review of terms healthy and natural; lowering sodium targets for foods; simplifying nutrition product labeling; among others to “to modernize our approach to better protect public health while removing barriers to innovation.” To read the full speech, click here.


Coffee Consumption Lessens Heart Defects for Non-smokers: Study
Good news for regular coffee drinkers – researchers at the University of San Paulo found that drinking at least three cups of coffee every day lowers the risk of clogged arteries in nonsmokers. In Brazil, researchers analyzed 4,426 adults, at an average age of 50 and given a food questionnaire to determine the frequency and the quantity of their coffee consumption. All individuals underwent physical examinations and CT scans that assessed the buildup of calcium in their coronary arteries. The results revealed that nonsmokers who consumed at least three cups of coffee daily had a 63% lower risk of clogged arteries. Click here for the study from the American Heart Association.

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