Checking Up On Health: March 26, 2013


Benita Dodd  Vice President  Georgia Public Policy Foundation
Benita Dodd
Vice President
Georgia Public Policy Foundation

Health Policy News and Views
Compiled by Benita M. Dodd 

Foundation event: Find out what’s happening around the nation and in Georgia – and what needs to happen – when it comes to innovative implementation of telehealth for greater efficiency, greater cost-effectiveness, better quality, better access and a better patient experience. Register now for, “Telehealth: Taking Health Care to the Next Level,” a Georgia Public Policy Foundation Leadership Breakfast at 8 a.m. on Tuesday, April 23 (The date was incorrect last week.), at Cobb County’s Georgian Club. The panel discussion is moderated by Dr. Brenda Fitzgerald, Commissioner of the Georgia Department of Public Health, with panelists Dr. Jeffrey English of the Multiple Sclerosis Center of Atlanta, Dr. Jeffrey Grossman of Peachtree Spine and Paula Guy, CEO of the Georgia Partnership for Telehealth. The cost is $25 to attend; register online at Attire: business, business casual. 

Happy birthday, Obamacare! March 23 marked the third birthday of President Obama’s Patient Protection and Affordable Care Act. The federal health law has gone through the terrible ones, twos and threes, and the struggle continues. Becker’s Hospital Review compiled a list of the five largest changes for hospitals, maintaining, “these specific events, provisions and programs have created ripple effects that will undoubtedly continue shaping healthcare delivery in the years to come.”

a)     Payment reform tied to quality measures.

b)     Accountable care organizations (ACOs), once so scarce they were known as “the unicorns of health care,” are proliferating. As of January, there were 428 ACOs throughout 49 states; the exception was Delaware. Private payors’ interest in coordinated care management helped spur this growth. ACOs emphasize the role of preventive care and providing care delivery in low-cost settings. That has heightened demand for primary care physicians – and they’re already in high demand due to a nationwide shortage.

c)     New provider-payor partnership models. Partly driven by the proliferation of ACOs, many more hospitals and health systems began striking value-based reimbursement agreements with commercial payors under ObamaCare. Many agreements are structured around the principles of preventive care, improved care coordination and chronic condition management. Generally, in most value-based deals, payors offer incentives or penalties tied to providers’ ability to meet specific quality metrics while delivering care within a projected cost.

d)     More robust fraud-fighting efforts and tougher penalties.

e)     Uncertainty around Medicare and Medicaid. Hospitals and health systems knew Medicare and Medicaid funds would be impacted with the law’s implementation, but perhaps not to this degree. Medicare and Medicaid disproportionate share hospital (DSH) payments, which subsidize hospitals that treat large numbers of elderly and poor patients, will be cut significantly by 2020 under the law, and Medicare DSH payments will be cut by roughly 75 percent in October.  

Carrot and stick: Increasingly, &YM_MID=1382384&sfvc4enews=42">employers are using incentives to improve workers’ health, a new survey finds. Incentives may come in the form of a reward, such as payment for reducing body mass index, or by imposing a consequence if the employee does not make a required step, such as – remember the brouhaha involving CVS last week? – completing a health survey. Aon Hewitt, a human-resource company, surveyed nearly 800 large and mid-size U.S. employers representing more than 7 million employees and found that 83 percent offer workers incentives for participating in health-related programs – 79 percent in the form of a reward, 5 percent in the form of consequences and 16 percent using a mix of both rewards and consequences.  And here’s a warning: The survey found that 58 percent of employers plan to impose consequences on participants who do not take appropriate actions for improving their health. Source: EHSToday 

Unintended consequences: The rush to implement ObamaCare, which is generating billions for insurers, hospitals and technology vendors, also looks like a boon for staffing companies, whose share prices have soared. Starting in January, employers with at least 50 workers must offer affordable coverage or pay a penalty. As you’ve heard, many companies are circumventing the coverage mandate by resorting to filling jobs with part-timers. Now they’re using temporary staffing agencies to provide the workers. School administrators in Dothan, Ala., aren’t sure whether health act rules taking effect next year will require them to offer medical coverage to substitute teachers, who lack it now, so they are hiring the subs through Kelly Services. Using the agency avoids any health-cost obligations that could come as their direct employer. Source: Kaiser Health News 

Personal responsibility: More large companies are offering their employees only one option: a plan with a relatively high deductible linked to a savings account for medical expenses. According to an annual health benefits survey, 66 percent of companies with 1,000 employees or more offered at least one such plan this year. This figure is expected to grow to nearly 80 percent next year. At nearly 15 percent of companies surveyed, an account-based plan was the only option – an increase from 7.6 percent in 2010.  Nearly a quarter of workers at companies with fewer than 200 workers were covered by such plans last year, compared with 17 percent of workers at larger firms. Source: Kaiser Health News

Pay to delay hits High Court: The U.S.Supreme Court heard arguments Monday on whether drugmakers can settle patent lawsuits with generic-drug makers by making arrangements to block generics. The court seemed conflicted after an hour of oral arguments, according to Dow Jones News, with some justices worrying that the practice would delay cheaper drugs coming to the market and hurt competition, while the court also noted that sometimes the arrangements are valid. The Federal Trade Commission has been fighting the practice for more than 10 years; drugmakers maintain such deals avert patent litigation. 

Balms for the aging I: The U.S. biopharmaceutical industry is developing 465 new drugs that target the top 10 chronic diseases affecting individuals 65 and older, PhRMA reports.  The lineup includes 40 for chronic obstructive pulmonary disease, 48 for heart failure, 82 for Alzheimer’s, 92 for osteoarthritis and rheumatoid arthritis, and 142 for diabetes. Others target osteoporosis, cataracts, depression and chronic kidney disease. Source: Bio Smartbrief 

Balms for the aging II: Johnson & Johnson expects to receive federal approval next year for a wrinkle-reducing injection similar to Allergan’s Botox. Allergan already faces competition from Valeant’s Dysport and Merz’s Xeomin, but it has an 85 percent market share. Botox, approved in 2002 in the United States to temporarily smooth severe lines between the eyebrows, has become a $1.8 billion-a-year brand. Botox procedures in the United States can cost as much as $1,500 for full treatment on three areas of the face and, as a cosmetic treatment, is not covered by health insurance. Doctors say the Johnson & Johnson’s product would be a hit if it were able to last five or six months, rather than the three or four months typical of Botox, Dysport and Xeomin. 

Apples without allergies: Italian scientists and researchers are trying to develop a hypo-allergenic apple, which could provide a new frontier for the genetically modified food market, the Daily Mail reports. While apples rarely cause the same intense allergic reaction as shellfish or peanuts, they often cause irritation for those allergic to birch pollen or cause blisters on the tongue or lips. The research team is working to find alternative hypo-allergenic proteins that exist naturally in other plants and swap them for the irritation-causing proteins in apples. Who knew? About 75 percent of people allergic to birch pollen are allergic to apples. 

Shortage of antibiotic R&D: Despite the horror stories about drug-resistant bacteria, few drugmakers are developing new antibiotics and some have trimmed their antibiotics research spending, Reuters reports. Regulatory hurdles and relatively low market pricing make antibiotics development unattractive.  

Quotes of Note 

“[N]othing in our opinion precludes Congress from offering funds under the ACA to expand the availability of healthcare…what Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding.” – U.S. Supreme Court

“Walking is the best possible exercise. Habituate yourself to walk very fast.” – Thomas Jefferson

“I don’t exercise. If God had wanted me to bend over, he would have put diamonds on the floor.” – Joan Rivers.

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