Tag Archives: healthcare reform

ObamaCare Choices not so Straight Forward

I have spent way to much time trying to stay informed and understand the implications of ObamaCare  (The Affordable Care Act).  This started with actually reading the legislation, listening to hours of Congressional hearings, and most recently working through the challenges of Healthcare.gov.  I figured, if nothing else, it would help me make a better decision for my spouse and myself when it came time to purchase healthcare insurance.  I’m not an Affordable Care Act certified “Navigator” or counselor but here are some simplistic and hopefully useful observations from the perspective of a person without employer provided insurance. 

Aside from the state and county you live in, the amount you ultimately pay in premiums depends on your income, choice of insurance company, and level of coverage you decide to carry.   Seems straight forward until you start to work through the details. 

First, where you live (state, county, and city) matters in terms of which insurance plans you have to choose from, how much you will pay to which providers (physicians and hospitals) are included in your plan,  and more importantly, which physicians and hospitals you’ll be able to use.  More on this later.

Second, the subsidy calculator (provided through the Kaiser Family Foundation website) is useful but only gives you an estimate about what your subsidy might be. You won’t find out for sure until you actually enroll and get a premium confirmed from the insurance company.   The subsidy calculator is very income sensitive.  For example, an annual income of $62,000 could mean a potential subsidy of over $7000 per year while there is no subsidy at an income of $63,000.  This is important when you start looking at what might be affordable for you.  If you assume or use a calculator-derived higher subsidy than you ultimately might qualify for, you may have chosen the wrong plan for you and your family.  As in the example, a few thousand dollars difference in your estimated and actual income for 2014 could mean a devastatingly unexpected tax bill at year-end. 

Next, because the plan options are categorized into levels of coverage (Bronze, Silver, Gold or Platinum) you might at first think insurers have standardized their plan offerings making a selection straightforward.  Choose a level that fits your needs and then just choose the insurer you want.  The reality is that within each level of coverage there are multiple levels of coverage with variability in premiums, deductibles, maximum out-of-pockets, co-insurance, and co-pays.

Your first impression might be pleasant surprise at all the options for healthcare insurance available to you now.  You might also be thinking premiums must be really competitive.  At the same time, you might be thinking there are just too many choices to systematically and intelligently evaluate.  There might be as many as five or six insurance providers vying for your business, each with a seemingly endless variety of plan options.  Sorting through the variables can be confusing and a bit overwhelming.  There are the obvious differences in premium prices and levels of deductibles, maximum out of pockets, co-insurance, and co-pays.  Then there are choices for PPO plans (Preferred Provider Organizations) versus HMO plans (Health Maintenance Organization). But, unless you have some idea about what you have paid in the past (your actual out-of- pocket expenses) for healthcare, there is no way to rationally determine which plan is best for you. Your general health may give you a clue as to how much healthcare you might use next year but it is incredibly difficult, if not impossible, to quantitatively assess plan choices.   

The complexity of comparison gets even more interesting when you go to the specific plan details available at the insurer’s website.  When you want to compare plans from three different insurers, for example, you go to each of their individual websites only to find the plan details formatted in a way that makes direct comparisons difficult. You now have the choice of printing off plans or bouncing back and forth between websites. Worse yet, you still don’t know the cost of individual components or if they differ between plans (e.g., a physician office visit for illness or emergency room visit). You just know generally, what the plan will cover as a co-insurance percentage or co-pay.

At this point, you will have spent a considerable amount of time trying to understand your options and might be about to give up but there are two  very important considerations to assess before choosing a plan. These are not readily apparent on Healthcare.gov or  in the plan summary documents at the insurer sites. 

Just because an insurance plan is offered in your area, does not mean you have easy access to the physicians and hospitals near you.   This is especially true in rural communities where local physicians or the nearby hospital may not be “in network” (covered by) of the plan you are considering.  That means you may have to go to another town or city to find “in-network” providers, insurer-approved physicians and hospitals. 

Physician and hospital information are not available on Healthcare.gov.  You have to go to the individual insurer sites and see which physicians and hospitals are in the plans you might be interested in purchasing.  Not always an easy task.  You might even have to do a preliminary application on the insurer site to access this information.  This is a critical evaluation step, especially if you have a physician and hospital near you that you want to use.  Even if the physicians are covered by the plan, they may not be taking new patients and you may not know this until you call to try to make an appointment.  If you choose the wrong insurance plan, based on low cost for example, the physicians and hospital of your choice may not be covered or accessible. 

Ok.  Let’s assume you have found a plan that fits your needs in terms of what you can afford, the level of coverage you feel you need, and the physicians and hospital are within reasonable proximity of your home.  What about the drugs you take?  Most plans have formularies (lists of drugs they cover) and tiered pricing with different levels of co-pay for generic drugs (usually no or small co-pay) up to more expensive brand name drugs (usually much higher co-pay).  The tiers are important, especially if you take single source brand name drugs with no or few alternatives.  So, not only do you need to know what you will be paying in co-pay for your drugs, you also need to know if your drugs are even available on their formulary.  This is especially true for very expensive specialty drugs that are often not covered the same as other drugs.  Fortunately, many plans publish their drug lists (formularies) on their website.  Just note that covered drugs and tiers may be different for Affordable Care Act participants, employer provided coverage, and individually purchased plans. 

Given this process, the research required, and the need for interpretation, analysis and evaluation, I find it hard to believe many people have the time, the patience, the resources, or the necessary information to make rational educated choices about which plan and insurer are best for them.  The variables are complex and difficult to match against individual affordability and healthcare needs.  Unfortunately, the plan with the lowest premium may drive selection, which may or may not be a good choice.


Why didn’t President Obama just read PharmaReform?

If  President Obama really wanted to know if Healthcare.gov was ready to go live on October 1 he should have read my last two blog posts ( September 11 and 12).  Having now listened to most of the Congressional hearings on the failed launch, it is clear to me that CMS was not being honest about the disastrous state of the website in the months leading up to the launch on October 1.

Again, even if the President had read PharmaReform, I’m certain CMS would have blown it off,  just as they have obviously ignored all the internal clues, information, and data demonstrating poor and functionally inoperable system performance of the site.  My assessment is that Healthcare.gov was doomed from the beginning.  Here are just a few of the issues that compromised the development and successful launch of Healthcare.gov.

  • Outdated IT procurement requirements limiting contractor selection, possibly precluding more capable and competent providers of IT services from participating in the bidding process (apparently the list of qualified vendors was compiled in 2007 … over 5 years ago and more than 2 years before the start of the project).
  • CMS blindly entrusted contractors depending on money (a virtually unlimited budget with hundreds of millions of dollars) and hiring lots of people rather than enlisting, securing, and deploying expertise to help build the site
  • Total incompetence at CMS in managing the project
  • Ignoring, suppressing, dismissing, or rationalizing bad news concerning the functional status of Healthcare.gov during development  
  • Total lack of coordination across the functional components of the project
  • The politically driven deadline (October 1)  wasn’t taken seriously by CMS leadership, contractors, project managers, and development teams until the final months leading up to the launch.
  • Poor, deceptive, if not outright dishonest communication about the status of Healthcare.gov, by contractors and HHS/CMS leadership to the Obama Administration and Congress

One of the most disappointing and frustrating take-aways from listening to the hearings is that this whole Healthcare.gov debacle could have been avoided had HHS and CMS management done their jobs.


How not to Build Trust and Confidence in ObamaCare

I subscribed to the CMS (Centers for Medicare & Medicaid Services) e-mail newsletters to stay up to date on what is going on and to make sure I get the information I need when it comes time to figure out what to do come October 1, 2013.

Well, a couple days ago I get an e-mail informing me of the “10 Healthcare Benefits Covered in the Health Insurance Marketplace” linked to a post at HealthCare.gov.  In a headline at the bottom of the page they encourage me to “Create an Account” so “When open enrollment starts on October 1, 2013, you’ll be able to apply, compare plans, and enroll in the Marketplace.”

OK, so after six or more tries (I didn’t think I’d have to count) I’m finally signed up.  It isn’t that tough and it is only three pages of simple questions with easy things to fill out, like your name, state, email address, username and password, and three security questions.   I can understand when I had to change my user name because it wasn’t long enough but to have to start completely over to make that one change was a little frustrating.

I am certain the average person doing this isn’t going to try as many times as I did, especially if you have to fill out the entire thing (not just correct the mistake) every time it rejects you. Worst is when everything is ok and you keep getting a “Try Again Later” message.  Remember, to “Try Again Later” you have to start all over.  At that point, I was doing this just to see how many times it would take to get an account created.  Most people would probably have given up after the second time they got rejected and had to redo their info.

So besides the frustration this creates and the potential to lose the people who just give up, it diminishes trust and confidence.  If you can’t even get a simple account set up for me, what is it going to be like to actually apply for insurance, and how in the world am I going to be sure you can get me healthcare when I need it?  What other hassles do you have in store for me?  mike@PharmaReform.com

Important Update:  Thank goodness, I got my account because a day after writing this they closed The Health Insurance Marketplace website for “upgrades” until October 1, 2013.  Even though I have an account in the old version, I’ll probably have to start over in the “Upgraded” version.  What do you think?

A Warning Letter to CMS for Obamacare “Misleading Advertising”

I subscribed to the CMS (Centers for Medicare & Medicaid Services) e-mail newsletters to stay up to date on what is going on and to make sure I get the information I need when it comes time to figure out what to do come October 1, 2013.

Well, yesterday I get an e-mail notice from CMS informing me of the “10 Healthcare Benefits Covered in the Health Insurance Marketplace.”  I’m redirected to a blog post on HealthCare.gov that has this wonderful list, especially for those who might need a lot of healthcare.  The list looks virtually “all-inclusive.”  The implication is that regardless of the plan or state I live in, once I pay the monthly premium, I get what’s on the list.  So, for example, item “# 6 – Your Prescription Drugs” are included.  The way it’s presented suggests that once I sign up for health insurance I will no longer have to pay for prescription drugs.  The same implication holds true for the rest of the list.  Choose my plan, pay my monthly premium and things on the list are paid for. Unfortunately, there is little detail and consequently this “advertisement” is very misleading, especially if you are not familiar with how the exchanges or insurance plans might work. No mention of cost variability, deductibles, or co-pays.

The blog clearly was designed to hype benefits while being intentionally vague about cost.   In fact, no mention of cost or cost variability is masterful copy-writing.   It creates an almost subliminal implication of “no additional costs” for “all inclusive coverage,” even for those of us who might sign up for the least expensive plan.   I may be wrong but I don’t think that will be reality and CMS knows that.

Maybe we should send CMS a warning letter for deceptive and misleading advertising.


Less Regulation for the Pharmaceutical Industry

I have always been perplexed by the contention that we need less government regulation and more lenient regulatory enforcement in this country, including in the pharmaceutical industry.   Proponents of less government regulation often make their case by proposing to “get government out of private sector business and let the market decide.”  They point to the unnecessary costs, business hardships, and ineffectiveness of government regulation.

We hear about “too much government” until something happens.  Something bad enough to negatively affect a large number of people.  A financial system meltdown, security breach that compromises their safety, or when people take advantage of them through deceptive marketing practices or fraud.  You really hear about the need for more government when people die unnecessarily due to a faulty or poorly manufactured product or a blatant disregard for health and human safety.  Then you hear “where is the government?” “isn’t there a law against that?” and “I’m going to sue.”

For years I have wondered how compounding pharmacies that scale to the size of drug manufacturers could operated without FDA oversight of their manufacturing processes.  Just leave it to State Boards of Pharmacy to monitor.  How “nutritional supplements” could make the health claims pharmaceutical companies could not make without rigorous clinical trials and FDA approval.  Do they really do what is claimed and do no harm?  How device companies could merely claim their product was “substantially equivalent” to an already marketed product to get on the market.  Does it really matter that pharmacies can sell drugs over the internet?  Why should I need a prescription?  Does it matter that the pharmacy operates out of another country or that the drugs I get are counterfeit?  Should it really be ok to create billion dollar blockbuster prescription drugs by marketing them for unapproved claims for patients who might be putting their lives at risk for no benefit?  Less government regulation and limited enforcement make these all possible, today.

The pharmaceutical industry and healthcare market have proven that business enterprises and individuals will push the limits of the law and even ignore the law to make a buck.  That doesn’t mean we should just get rid of government regulation.  In fact, less government regulation and diminished enforcement merely create even more opportunities without negative consequences for fraud, for dangerously marginalizing manufacturing quality, and for the unscrupulous to take advantage of consumers, regardless of how informed or well educated the consumer might be.   Less government regulation and limited enforcement in a “buyers beware” market is not an acceptable commercial environment, especially for the pharmaceutical industry where patient health, safety, or lives are at stake.

So what’s my conclusion?  We need government agencies to do a better job of enforcing the laws that are already in place. We need them to work with law makers to eliminate laws that are no longer doing what they were intended to do when they were adopted.  We need law makers to do a better job of drafting legislation (have you ever read a page of Final Rules in the Federal Register?) to protect consumers.  But what we need most is for businesses and individuals to quit “gaming the system” with wealth building strategies based on taking advantage of lax regulatory enforcement and the unaware or mislead consumer.  mike@pharmareform.com

Banning Pharmaceutical Sales Representative Access to Physicians

Pharmaceutical companies are held legally and financially accountable for making sure their drugs are used appropriately and that physicians and patients are aware of and understand the risks associated with their prescription drugs.

Product liability litigation against pharmaceutical companies often feature how the pharmaceutical company insufficiently or inaccurately informed physicians  (often highlighting what the sales representative said or didn’t say and the brochure used) about the appropriate use of products (right patients, right dose) or communicated misleading understatements or outright omissions of the risks associated with prescribing those drugs.  Companies who can demonstrate they did everything they could to accurately and comprehensively inform the prescribing physician, especially about the risks involved in the plaintiff claims, are generally afforded some degree of legal protection under what is called the “learned intermediary” doctrine.

An increasing number of healthcare systems, hospitals, and academic medical centers are banning pharmaceutical sales representatives from their institutions.  Some group practices and even individual physicians are also placing restrictions on pharmaceutical representatives.  The intent is often to control the influence of sales representatives on physician prescribing but also to preclude representatives from distracting physicians and consuming practice time with interactions that are perceived to have little or no value.

Whatever the reason for limiting sales rep access to physicians, I am wondering how pharmaceutical companies could possibly be expected to fulfill and demonstrate their “duty to warn” responsibilities when institutions and physicians have decided to ignore and outright refuse one of the historically most effective means of communicating product information.  Will the package insert information now be the basis for appropriately “informing” the medical community and satisfy the “learned intermediary” doctrine?

Again, I am not a lawyer but I wonder what the courts and patients are going to say when a pharmaceutical company facing a “failure to warn” product liability charge demonstrates that their package insert clearly delineates the appropriate use and potential risks and they did everything they could to get the information to the physician but they were banned or denied access.  What are physicians going to tell their suing patients when the pharmaceutical company representatives testify that they tried repeatedly to get time with the treating physicians  to discuss the risks and benefits of the drug but were prohibited by policy and rejected at the office or hospital.

If healthcare systems and physicians make the decision not to include pharmaceutical company representatives in their drug education process are they also assuming more liability when pharmaceutical companies defend themselves by demonstrating that healthcare systems and physicians “chose” not to be informed or educated by the company?   They may in fact feel this is no big deal, they’ll just do their own educating.  But if physicians and healthcare systems assume this responsibility and take the deep pockets of the pharmaceutical company  “off the table” , are they really ready to assume the financial consequences or will patients seeking compensation and their lawyers be less quick to file these product liability suits?


New Job Requires Expertise: Electronic Health Records Clinical Researcher

The US government driven (CMS, Centers for Medicare & Medicaid Services) incentivized push for electronic health records (EHRs) has mostly focused on the business logistics of tracking healthcare delivery and associated costs.  And while the proposed Accountable Care Organization concept deepens the utility of EHRs to include quality and clinical outcome performance metrics they also have implicit goals for managing and controlling costs.  Under the guise of better healthcare at lower cost, my impression is that most healthcare systems are probably looking at this more in the context of making sure CMS or insurers are comprehensively billed and that they have a way to verify billing accuracy and any incentive payments have been rightfully earned.

I wonder if we will ever get to a point of exploiting the clinical information hidden in these electronic data files.   Could EHRs ever lead to better real world data to support evidence based medicine?  With millions of patients in the “real world” data sets over an extended period of time you would think that figuring out “best practice treatment guidelines” would be better served than by a couple of clinical trials with a few hundred or even a couple thousand carefully selected patients studied over a relatively short period of time.  Want comparative effectiveness?  You would think this could be determined with the electronic data on thousands if not millions of patients rather than a small statistically designed trial in a single institution or small number of sites.  EHRs could also be useful for identifying treatment trends or determining where companion diagnostics might be most helpful.

The challenges of HIPAA compliance, research regulations, and bioethical considerations are beyond my area of expertise but I feel it would be a unfortunate if they stood in the way of being able to use this valuable information.  There must be ways to design and execute this type of research without compromising patient confidentiality and ensuring patient safety.  I also appreciate the pitfalls, limitations, and scientific critiques of retrospectively data mining to assess and evaluate clinical data.

The value of EHRs goes well beyond the financial implications and benefits.  To realize their clinical potential the data must be accessible; it must be analyzed and accurately interpreted.  This will require a new breed of clinicians with specialization in the design, execution, and reporting of EHR clinical study data.  Clinical interpretation of the data will require therapeutic area expertise, an appreciation for statistics, and a comprehensive understanding of the data set and the nuances of the data limitations.  These are not part-time jobs but rather new job functions (staffed with expertise) that add cost to healthcare initially with cost benefits coming in the form of more cost effective, better treatment outcomes in the future.

The danger will be in executing poorly designed,  “quick and dirty” reviews and clinical assessments without expertise which can lead to misleading or wrong conclusions and potentially adverse or costly recommendations … purportedly supported by data.   mike@pharmareform.com

Do Prescription Drugs Add to, Shift, or Reduce Healthcare Costs?

One would think that by implying your prescription drugs keep people healthy and out of the hospital you could also imply and conclude that drug treatment will lower overall healthcare costs for those patients.  The pharmaceutical industry has implied this for decades.  And, this may actually be true in many cases but the evolving new healthcare market is becoming much less receptive to what would seem to be obvious and will be demanding more and better data to support any claims of improving clinical outcomes at lower cost.   Interestingly, some healthcare providers have already determined this is not just a pharmaceutical industry issue.

For example, pharmacists for years have claimed that they can help patients avoid medication errors and improve patient care through patient counseling and follow up.  They are often the only healthcare provider with that opportunity once a prescription is written, especially for chronic conditions.  Seems logical that pharmacists obviously play an important role here.  But then you read the recent study that suggests that mail order pharmacies may do a better job of lowering costs while improving clinical outcomes than local pharmacies.  Whether or not this study can be replicated or validated remains to be seen but it represents how it is going to be better to have data to support your position than to rely on implication.  Think about pharmacists who now are trying to make their case for improved clinical outcomes with counseling at the local pharmacy.  What data do they present to refute this mail order study?

Similarly, Express Scripts® recently reported on several research studies that demonstrate the ability of Pharmacy Benefits Managers to lower costs and improve clinical outcomes.  Again, even as part of the “managed market,” Express Scripts® felt compelled to support their benefits claims with data.

Why is this important?  Because pharmaceutical companies who still feel they can use traditional marketing and sales advertising and promotion to imply being able to lower costs while improving clinical outcomes  without actually having the data are going to have a much more difficult time convincing decision makers and selling their products.  More importantly, pharmaceutical companies that develop the real world data to support their claims for improving clinical outcomes and lowering overall healthcare costs (and not just shifting costs to another part of the healthcare system), will find a more receptive audience and create a significant competitive advantage.

We are entering a time where the healthcare market will expect you to prove (“show me the data”) that you (as a healthcare provider) or your products or services are delivering demonstrated (data driven) real world clinical outcomes that reduce overall healthcare costs.   mike@pharmareform.com



PharmaReform e-book now available in Amazon’s Kindle Edition

Now you can take over 100 PharmReform articles with you and have it with you in the new Kindle version e-book format.

PharmaReform.com has explored a broad range of challenges and issues affecting the pharmaceutical industry.  The intent of the blog posts has been to encourage and  stimulate thinking about how to address industry shortcomings while finding more patient- and healthcare customer-friendly approaches to marketing and selling prescription drugs in an increasingly complex business environment.  The management and leadership challenges of running a drug company make for stimulating discussion with plenty of opportunities for improvement.

Reviewing the functional  diversity of running a drug company from manufacturing to research, the author provides an industry insider perspective to the commentary, suggestions, and recommendations for transforming drug companies into innovative profitable businesses in the evolving new healthcare market while reestablishing public trust and credibility.

Over 100 blog post articles, organized by topic (see Table of Contents),  are included in this e-book format (Amazon’s Kindle) providing readers who prefer them in this handy, easy to retrieve, convenient portable document.   mike@pharmareform.com

Are Pharmaceutical Marketing and Sales Targeting Pharmacists?

In an earlier post we discussed the role of the clinical pharmacist in the evolving new healthcare market.  Medication therapy management as required by CMS as a part of Medicare Part D plans is a good example of where and how pharmacists can and are expected to help improve adherence and therefore clinical outcomes while potentially lowering overall healthcare costs.  Given the healthcare failure statistics we  previously discussed it’s hard to imagine that medication therapy management really gets all that much attention from pharmacists or pharmaceutical marketers.

A recent featured article in Health Benefit News highlights the success WellPoint has experienced in a pilot program to enlist and pay pharmacists for more attentive “medication therapy management.”  They were able to demonstrate increases in adherence which not surprisingly translated to better control of disease symptoms for hypertension,  hyperlipidemia, and diabetes mellitus.   While pharmacy costs went up they also “saw a great reduction in hospitalizations.”  Overall, in the one year study, they saw cost neutral results, but concluded “it’s going to take more than a one-year time frame to see dramatic changes in cost.”

The healthcare market (with pressure from government, payers and insurers) is getting more aggressive about delivering better clinical outcomes as one way to help increase quality and lower the cost of care.  So whether it is through Accountable Care Organizations, Integrated Healthcare Systems, or just enhancing outcomes from solo or group practice settings, I believe pharmacists will play an increasingly important role in medication therapy management, especially adherence-enhancing programs.   Pharmaceutical marketers who view the retail or hospital pharmacist as merely a dispenser of medications and cursory counseling will be putting their products at risk of competitive erosion and never meeting their full commercial potential in the evolving new healthcare market.

So what’s a pharmaceutical marketer to do?

Well, how many pharmaceutical marketers have assessed (not just mentally speculated) how their product might perform in this type of a trial or study?  How many have commissioned similar types of studies?  How many marketers have partnered with healthcare provider systems to determine the adherence value (clinical outcome differences) between adherent and non-adherent patients and what the value proposition could be?  How many marketers have actually met with pharmacists about their evolving role? How many have started to work with pharmacists on developing educational programs and materials for their products?  How many have pharmacist training programs for their patient education programs?  More importantly, how many pharmacists are considered high priority calls for your sales representatives?

I think I just heard somebody say…”of course we are doing all this.”

Great.  Now, are you doing it as  just another marketing tactic?

I might suggest that if you are doing it to genuinely help patients, pharmacists, and healthcare provider systems achieve their goals, you will find a much more receptive audience, ready to embrace your efforts and make meaningful contributions to your product success without feeling compromised.      mike@pharmareform.com