Blog Posts

the gop's healthcare plan

4/2/2019

In a move that caught all Capitol Hill by surprise, President Trump and key Senators finalized the outline of the GOP’s new healthcare plan over the weekend.

Set to be announced later today, the plan builds off the faith-based “sharing” programs already in place in the ACA, greatly expands their reach, incentivizes employers to adopt faith-based coverage, and enables these programs to compete in the senior market. There are a half-dozen or so ministry/faith-based programs now in operation with total membership around the million mark.
Unlike regular insurance, members “share” the cost of care by paying into a central fund that then reimburses individuals for needed medical services.

Currently faith-based coverage is provided by entities including Liberty Healthshare, Christian Medi-Share, Samaritan Ministries, and Altrua Healthshare. As of today, these entities don’t have to provide the same level of benefits, coverage, or financial protection insurers do under the ACA. And, they are pretty much exempt from regulation as they aren’t “insurance” per se.

Faith-based sharing programs will compete with the big health plans for members in the federal – and perhaps states’ – healthcare exchanges. The plans, which are much less expensive than “regular” health insurance, may well see huge gains in membership.

On ABC’s This Week Sunday talk show, White House Chief of Staff Mick Mulvaney asserted the plan would deliver on the President’s promise to protect Americans with pre-existing conditions. “We’ve heard it over and over again, Americans trust their churches and ministers to do the right thing [which includes addressing pre-existing condition coverage]. So, we’re going to build off the amazingly successful faith-based programs now in place, expanding their reach and helping them compete in the free market.”

When asked how the new plan would maintain or expand the number of Americans covered by health insurance, Mulvaney didn’t get into any details other than claiming “faith-based programs will have much lower administrative costs as they don’t have all the overhead the big insurers do…this will make insurance much less expensive, which means more people can afford it.”

It appears Vice President Mike Pence has been strongly advocating for the faith-based approach for some months. Evidently Pence, a self-described evangelical Christian, was prepared when the President publicly called for Republicans to be “the party of great healthcare” last week. The VP met with Trump, Mulvaney, and key Senators over the weekend and finalized the outline of the plan.

Mulvaney, who is one of the members of Trump’s team leading the charge on repealing Obamacare, said Sunday “There’s absolutely zero daylight between the president and vice president on this issue.”

Interviewed on CNN’s State of the Union yesterday, Mulvaney went further, describing the plan as fulfilling Senate Republicans’ request that the Administration provide them with “principles” that they could build a healthcare plan around.

Here’s the issue. Faith-based programs don’t have to keep a certain level of financial reserves, can deny payment for any reason, exclude any condition, and cancel coverage. And, in most states no regulator is watching over the programs.

Sure, this will make “coverage” cheaper, but there’s no guarantee it will be there when the buyers need it.

I’d expect this approach to face tough sledding in the Senate, and likely won’t be considered at all in the Democratic–controlled House. However, it’s likely Trump will try to do much of the heavy lifting via regulatory means and Executive Orders. However, these efforts will undoubtedly be challenged in court, where Trump has had a pretty poor record. I’d also expect the big health plans will roll out their lobbying big guns.

But, the move further cements Trump’s standing with evangelicals. As he’s clearly playing to his base to prep for the next election, which will serve him well.

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congress issues rfi on telehealth legislation

3/13/2019

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On March 12, 2019, the Congressional Telehealth Caucus, together with a bipartisan group of Senators, published a request for information (RFI) asking for help and guidance in crafting “comprehensive telehealth legislation for the 116th Congress.” The Caucus is seeking input from the public as it relates to its goal of “assembling a revised telehealth package that continues to expand access to vital, cost-efficient telehealth and remote monitoring services across the country.”

The letter notes that the group is hoping to build on former successes and is seeking “recommendations on policy areas most likely to prompt Congressional action, including ideas that are fiscally responsible and able to generate bipartisan support.”

The RFI specifically requests input on recommendations that would:

Expand access to telehealth and remote monitoring, especially in rural or otherwise underserved communities;
Improve patient outcomes, whether by expanding access to specialists or other providers or by easing the day-to-day patient experience;
Encourage easier and expanded use of existing telehealth and remote monitoring technologies, many of which suffer from low uptake rates; and
Reduce healthcare costs for both patients and federal programs, including Medicare.

When submitting comments, the Caucus asks that “existing data or records demonstrating the success of or otherwise supporting the recommendations” are included, so as to bolster the potential passage of legislation including the ideas.

Alston & Bird Advisory and Suggestions

Mar 19, 2019 Alston & Bird, LLP issued an advisory on March 25, 2019, that mentions some possible legislative and/or regulatory actions that may help to encourage “wider telehealth adoption, promote access to care, and improve patient outcomes through technology-enabled health care.”

One idea included in the advisory is the recommendation that rural restrictions continue to be removed to allow for telehealth services to be provided to an expanded reach of patients in urban areas. The advisory notes that Congress has been working at slowly removing this restriction, including removing geographic requirements for home dialysis end-stage renal disease and telestroke treatment effective January 1, 2019, and for substance abuse treatment effective July 1, 2019.

Another recommeded possibility is to bring a consistency to remote patient monitoring. The advisory references the inconsistencies in CMS’ announcement regarding reimbursement of remote physiologic monitoring and the reversal of a decision regarding when such reimbursement is permitted, based on who provides the RPM services. Alston & Bird note that in this instance, CMS may be in the best position to resolve these inconsistencies, congressional action may prove to be helpful.

Another concept mentioned in the advisory, and one that has been previously mentioned by several in the health care arena, is to highlight additional opportunities for the adoption of telehealth and virtual services. This legislation can be as focused or wide-ranging as Congress is comfortable with, but it is likely that Congressional action on furthering the adoption of telehealth and telemedicine would go a long way to making it more commonplace.

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what exactly is transparency?

2/5/2019

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Buyers are asking healthcare intermediaries for “transparency.” I’ll try to concisely describe what this transparency thing is.

The emphasis on try is an upfront admission that a blog post is not going to be the end-all and be-all answer. You aren’t going to read a 5000 word treatise on this – and I sure don’t want to write it.

With that caveat, here goes.

First up, we are dealing with intermediaries or middlemen. Think PBMs, bill review firms, networks; entities that contract with healthcare providers, pharmacies, durable medical equipment vendors, chiropractors etc.; also hospitals. The intermediaries aggregate buyers and providers and provide simple access to and communications, data, and financial flows between those entities.
Let’s take Pharmacy Benefit Management as an example. Of late large benefit buyers have been pushing PBMs to offer transparent pricing options. One, the National Drug Purchasing Coalition, is working with Express Scripts Inc. to provide its members with cost plus admin fee pricing for drugs. That is, buyers know and pay what ESI pays for drugs, plus a per-script admin fee. ESI won’t earn any fees from the dispensing pharmacies or it’s own mail order pharmacy, nor will it capture any rebate or similar revenue. (disclosure – ESI subsidiary myMatrixx is an HSA consulting client)

Express is also offering clients a choice of formularies; to quote the Washington Post, “…clients can choose between lists that include drugs with a high list price — and high rebate…or the new list with lower-price drugs but with little or no rebate.”

And that is one reason this whole transparency thing isn’t as easy or straight-forward as one may want.

Rebates – which in this example are payments from brand drug manufacturers to PBMs to financially incentivize the PBMs to offer their drugs – can be opaque and hard to pin down. Buyers demanding full transparency will want full financial credit for all rebates…but they may also want to keep total drug costs down.
In some cases, those buyers will find that those rebates they participate in mean their total drug costs are lower – while their members may pay more.

This is an admittedly simplistic scenario but one that illustrates the key question – what do buyers want when they say “transparency?” I’d suggest what many buyers want is lower cost – but they aren’t asking for lower cost, they are asking their vendors for a specific thing that the buyer thinks will reduce cost. Of course, they also want to know that they are getting a fair price.

After lots of analyses and back-and-forth data dumps and algorithm testing and forecasting, what usually happens is…the buyer picks a non-transparent pricing option, that usually has some cost-cap guarantee or other mechanism to manage risk.

What does this mean for you?

There’s a lot to unpack here – but my top three are:

Ask for what you want as the end result, not a means to get there. Let the vendor figure out how to get you what you want.
Transparency is defined different ways – make very sure your definitions are consistent within your organization and your vendor partners’.
When you “go transparent” you’ll have to pay more for stuff your vendor was providing under a bundled price. Call centers, clinical support, formulary management, client and state reporting, script transfer programs…all cost money to deliver.

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most trusted: nurses, doctors & pharmacists

1/7/2019

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Nurses rank top in Americans’ minds for the seventeenth year-in-a-row, Gallup found in its annual survey of honesty and ethics in professions. At the bottom of the list for honesty and ethics in 2018, Gallup points to U.S. Congressional representatives, “Mad Men” and Women of advertising, telemarketers, and folks who sell autos.Congress-folk and car salespeople have ranked at the low-trust bottom for many years in this Gallup poll.

While the three health care professions rose once again to the top of the job-trust roster, nurses rank far greater than doctors and pharmacists by a 17-point margin of consumers rating the nursing profession with very high or high ethics (among 84 percent of all Americans). Doctors and pharmacists were virtually tied with two-thirds of U.S. consumers saying they rank very high or high on the honesty scale.

Note that last year, pharmacists dipped to an historic low in this poll, compared with a high bar set in 2013. Gallup conjectured that in 2017, some consumers were associating pharmacists with contributing to the opioid addiction crisis.

Gallup also notes that journalists’ ranking improved by 10 percentage points since 2016, while clergy’s perceived honesty and ethics have continued to decline over the past twenty years.

It cannot be overstated that nurses in America are the most beloved profession in and outside of the health care industry.

As the sector learns how to be more consumer and patient focused for customer experience, health care providers would be wise to leverage this highly-valued touch point. Whether in face-to-face health care, virtual/telehealth modes, or call centers, patients love and appreciate nurses.

“Nursing is at the heart of health care,” the 2018 National Council of State Boards of Nursing report on nursing supply in 2018 attested. But as beloved as nurses are, there is a shortage projected as "Baby Boomers" age and, at the same time, there aren’t enough faculty to teach nursing students. As a result, over 64,000 qualified nursing school applicants were turned away from colleges in 2016 according to the American Association of Colleges of Nursing.

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problem with medical device fda regulation

12/7/2018

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A global investigative report has shone an unwelcome light on a largely unregulated industry I exposed in detail almost one year ago – the medical-device industry. The report documented that the 190,000 devices currently on the market have been responsible for 1.7 million injuries and some 83,000 FDA reported deaths over the past decade.

In response to the report, FDA Commissioner Scott Gottlieb, pledged reform this week. But it’s unclear whether he will be any more effective with medical device CEOs than he has been with pharma CEOs who he sternly directed to “end the shenanigans.”

Here are the basics on medical device regulation:

1) Most Americans remain unaware that in the eyes of the FDA not all therapies are considered equal when it comes to regulatory approval and oversight. Drugs are one thing, but medical devices are quite another.

2) Even the most high-risk implantable devices are often approved after a single clinical research trial, and most of these are not randomized, controlled or blinded trials.

3) Some 15% of approved devices created by this $150 billion dollar industry in the U.S. are eventually removed from the market, but often not removed from the patients in whom they were implanted. Unlike drugs, devices often remain for a lifetime, subjecting their subjects to continued risk and worry.

4) The FDA regulatory framework is the product of a tragedy. In 1970, Dr. Hugh J. Davis sold his invention, a small fish like implantable uterine device which dragged a porous multifilament string, to the A.H.Robins Company. In 1971, it went to market as an IUD that would be a safer alternative to birth control pills considered high-risk at the time. Called the Dalkon Shield, it was implanted in 2.8 million women. But within five years, its association with infection, septic abortions and death was irrefutably established and linked to its’ mutifilament tail. Within the decade, there were 300,000 lawsuits and A.H. Robins went bankrupt.

5) In response to the public outcry, Congress passed the 1976 Medical Device Amendments to the Food, Drug and Cosmetic Act, and for the first time required testing and approval of “medical devices.” The loose system they put in place had to deal with the fact that all the devices in use at the time had never been independently analyzed or approved. They were effectively grandfathered in.

6) All new products were placed in one of three classes. Class I included low risk devices like tongue depressors or forceps. Class II devices were “cousins” to other devices already in use like joint replacement devices and electrocardiographs. And Class III were new devices which appeared to carry some risk like pacemakers or heart replacement valves.

7) Class I and II required quick and inexpensive premarket review, little extra documentation, and simple “premarket notification”. Class III required that manufacturers provide some kind of evidence that the product was safe and effective, but this often came from scientific reviews that were less than rigorous and often anecdotal. In return the company received a “premarket approval.”

8) Liberalization of the process occurred in the years that followed with two tracts created for new product approval: 1) “premarket approval” requiring clinical testing and inspections, or 2) the 510(k) process requiring affirmation that the new device is essentially similar to a device already on the market.

9) User fees range from around $200,000 for “premarket approval” versus around $4000 for the 510(k) tract. But equivalency can be in the eye of the beholder. For example, the ObTape Vaginal Sling for operative repair of female stress continence sailed through on a 510(k) approval in 2003 based on the manufacturer’s contention that it was substantially equivalent to support tapes manufactured by J&J and American Medical Systems already in use. But when adverse reports of encapsulation and expelling of the material with infection began to surface in 2004, it became clear that the ObTape was made of a dense material poorly incorporated by biologic tissues while the comparators were porous materials that allowed for vessel in-growth.

10) The net effect was that 113 approved devices had to be recalled between 2005 and 2009 because of serious complications or death. Roughly 4 out of 5 of these had avoided vigorous review.

11) In 2010, 500 million individual devices were recalled nationwide, and a review by the Institute of Medicine found the approval process ”flawed based on its legislative foundation” and that the FDA lacked a “integrated premarket and post-market regulatory framework.”

12) The 21st Century Cures Act, which dramatically drew the support of Joe Biden in the wake of his son Beau’s cancer death, was also loaded with FDA changes that further liberalized approval of medical devices including the use of “data summaries” and “real world observational studies” to support device approval.

13) Add to the “green light” serious issues with Conflict of Interest. Take for example the case of pacemakers. Approximately 400,000 Americans have them implanted each year, with 80% over 65 and 20% over 80 years old. In 1984, there were 56 heart conditions for which the American College of Cardiology approved a pacemaker as treatment. Twenty-five years later, that list had bulged to 88 conditions. Only 5% of those indications were backed by double-blind studies. Some 60% of the approved indications were based on recommendations from a 17 member expert government panel. 11 of those 17 were on the payroll of medical device makers.

14) Medical devices are fundamentally different than pharmaceuticals in one important respect. If a drug is pulled from the market, a patient can stop the drug and it will eventually clear from the system in a relatively short period of time. In contrast, many devices either cannot be safely removed, or their removal comes at great risk.

15) Medical device manufacturers are part of the Medical-Industrial Complex which now controls 1 out of every 5 dollars in the American economy. Code Blue: Inside the Medical-Industrial Complex, due to be published by Grove Atlantic Press in April, 2019, will reveal that collusion and syndicated profit sharing extends well beyond the limits that Commissioner Gottlieb is prepared to admit.

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gap in cybersecurity for medical technology

11/8/2018

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Notwithstanding mass adoption of antivirus protection and firewalls among healthcare providers, there remains a security gap for biomedical technologies, according to a report from Zingbox.This concerning finding was confirmed in recent observations from Gartner, which wrote in a market trends report that, “generally, medical devices are not replaced for at least ten years, with many running old software that has not been updated or patched.”

Zingbox learned that most healthcare executives say they’re confident in their ability to protect connected medical devices: 79% of health IT professionals say they have real-time information about which connected devices are vulnerable to cyber-attacks, 87% are confident that the devices are protected from an attack, and 69% say their traditional security approaches for computers are adequate to secure connected medical devices.

However, there’s a disconnect between these sanguine perceptions about cybersecurity versus the actual solutions in place, Zingbox found.

Zingbox surveyed over 400 U.S.-based healthcare IT leaders for the survey in October 2018.

Unisys published their 2018 Security Index, finding growing global insecurity concerns among consumers about the internet, identity theft and bankcard fraud — ahead of terrorism, natural disaster and epidemic threats.

It’s important to note that 79% of consumers support the idea of medical devices and sensors that immediately transmit significant changes to peoples’ doctors, as the bar chart from Unisys’s consumer survey data illustrates. But at the same time, Unisys VP and global head of Life Sciences and Healthcare Jeff Livingstone noted in the Index report that, “We’re seeing in life sciences and healthcare that criminals are moving away from financial fraud and bankcard fraud, and more toward identity theft related to healthcare personal data. It’s become very lucrative for criminals to mine healthcare identifies on the black market.”
To deal with this growing challenge, this week the U.S. Department of Health and Human Services launched the Health Sector Cybersecurity Coordination Center. October is National Cybersecurity Awareness Month (who knew?) and this Center demonstrates DHHS’s commitment to keeping U.S. healthcare secure from cyber-attacks.

There were over 400 major healthcare breaches reported between 2017 and 2018, accessing sensitive medical data, targeting patient medical equipment, and seeking to extort financial gain.

In the promising and growing Internet of Things landscape for healthcare providers and patients, more medical “things” will be connected to the internet for remote health monitoring, patient care, and diagnostics. The more connected nodes in healthcare, the more temptations and opportunities for cyber-attackers to attack. Being honest and mindful about these threats is step one; step two is shoring up the security for each of them, and across the healthcare enterprise.
Consumers and clinicians would be wary of using medical devices known to be hacked, shown in the last graphic from a recent PwC study.

Without security strategies and assurances, patients-as-consumers would be less likely to want to share their healthcare data with providers and researchers, and patient care and cures will be the poorer for that. Furthermore, the enterprise itself could lose patient-customers, wary of using a specific hospital facility whose equipment was hacked. Risk management for cybersecurity in healthcare touches finance, quality and reputation alike.

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