HealthCare Roundtable e-News – October 9, 2018

Posted on by HealthCare Roundtable

Brands Soften Opposition to Pro-Generic Bills, Look to Lame-Duck Session After Failed Bid in Opioid Bill

Brand-name drug makers have been pressing to reverse the effects of a budget law enacted in February that raised their share of seniors’ drug costs from 50 to 70 percent as part of the coverage gap known as the donut hole. As a result, brands are aiming to lower their share of donut hole costs to 63 percent, which Democrats say would cost the government at least $4 billion, while drug makers would save an estimated amount that is nearly double that. The Roundtable strongly opposes the change.

The failed bid was a rare loss for brands and surprised lobbyists across the healthcare spectrum. Since then, brands and lobbyists have been trying to reverse the measure, or at least partially undo it, by softening their positions on two pro-generic bills; the Preserve Access to Affordable Generics Act, which would ban so-called pay-for-delay settlements, and the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act, which would stop the brand practice of using drug-safety programs to withhold drug samples needed for generic approvals.
Brands and industry lobbyists are expected to continue pressing for Part D changes, despite their failed attempts to add changes to the final opioid package, throughout Congress’ upcoming lame-duck session.

Medicare and Medicaid Innovation Chief Not Concerned Over ACOs Dropping Out of Program

Medicare and Medicaid Innovation Director Adam Boehler recently spoke at a National Association of ACOs conference on CMS’ proposal to revamp the Medicare Shared Savings ACO program. New guidelines would give new ACOs only two years before they must start sharing both savings and losses with the agency. When the proposal was released, CMS Administrator Seema Verma said the agency wanted to work with ACOs that were serious, and could no longer afford to continue a program that loses money for taxpayers.

Boehler said he doesn’t “stay up at night worried about” ACOs dropping out of the program. “What I mean by that is if you enable some of the capitated groups and people that today are not in the ACO market to do that, I don’t think you’ll have problems with people that will take risk. So I will say from my perspective, I don’t worry that much about that, because I think what would happen if somebody drops is there will be people in their place.”

Boehler suggested that CMS must give providers transparency, make models simpler and give providers the necessary tools to succeed, but accountability and the ability to drive results is expected in return. Boehler had previously claimed that value-based care doesn’t equate to taking on risk – it means better outcomes and lower costs. But for those that can or should take on risk, accountability is extremely important.

Katherine Schneider with the Delaware Valley ACO said she is all for disruptive innovation and microsystems that can do very well in the healthcare market, but they can be very niche, saying that if she belonged to one of the ACOs that very recently joined the program, she would be thinking hard about whether to continue to participate in light of the proposed rule.

USMCA Deal Includes New Protections for Brand Biologic Drugs

Provisions in the new North American trade deal and drug makers’ failure to add Part D provisions to the Senate-approved opioid package are prompting concerns over what’s to come after the upcoming midterm elections.

The trade deal between the U.S., Mexico, and Canada, contains a provision that would grant no less than 10 years of marketing exclusivity for biologics, a move strongly opposed by public sector purchasers and the Public Sector HealthCare Roundtable. The language used in the provision denotes that a company that wants to sell a lower-cost version of a brand-name biologic, which is known as a biosimilar, would be prevented from doing so for a decade. Drug companies argue the language in the deal is designed to bolster intellectual property rights for medicines will hurt taxpayers and patients.

“The president keeps saying he wants to address the high cost of prescription drugs, but he doesn’t do anything, and the Republican majorities don’t do anything,” Rep. Frank Pallone Jr. (D-NJ) told The Hill. Pallone would likely be chairman of the Energy and Commerce Committee if Democrats win back the House.

There is bipartisan concern over how dramatically drug prices have increased over the last decade, but the parties are divided on how best to solve the issue. Rep. Elijah Cummings (D-MD), the ranking Democrat on the House Oversight and Government Reform Committee, said he wants executives from the largest pharmaceutical companies to testify about why their prices are so high.

Patients Urge Congress to Create Transparency on Air Ambulance Costs and Coverage

Patients and families across the country are fighting a battle against shockingly high air ambulance and medical flight bills, an issue that’s been brought to the attention of many by NPR’s “Bill of the Month” series. Since its launch, the series has been investigating complaints about sky-high bills to critically ill or injured patients who were charged tens of thousands of dollars for an air ambulance ride even after insurers’ payments. According to complaints, surprise charges for various medical flights have ranged anywhere from ranged from $28,000 to $97,000. Most charges fall between $30,000 and $88,000, with the average hovering around $60,000.

The federal government treats air ambulance companies as air carriers, which are regulated by the Federal Aviation Administration, an agency not required to participate in insurance networks. When an air ambulance service isn’t part of a patient’s insurance network, the operator can charge patients for the portion of the bill the insurance company won’t cover. Legislation to reauthorize funding for the FAA that is moving through Congress now would set up a council of industry experts to address balance billing and other issues, and set up a complaint line for consumers.

Sen. Claire McCaskill (D-MO) pushed a bill this year to clarify that a 1978 statute could not prevent states from regulating the medical costs from air ambulances. Provisions from her proposal made it into the latest FAA reauthorization bill; however, lawmakers ultimately dropped the crucial measure that would allow states to address the consumer cost question.

The final compromise provision requires the U.S. Transportation Department and HHS to convene an advisory committee of stakeholders to examine transparency measures, consumer education about insurance options for air transport and protection from excessive charges.

California Governor Signs PBM Bill Requiring Disclosure of Drug Pricing and Additional Fees

California Governor Jerry Brown signed a bill on Sept. 29 giving the state’s Department of Managed Health Care regulatory oversight of pharmacy benefit managers. The bill requires drug pricing middlemen to disclose information on administrative fees, among other provisions.

Assemblyman Jim Wood (D) led the initiative, which was signed despite some backlash from the national pharmacy benefit manager and health insurance lobbies and the California Department of Finance. Wood’s office said the law should help “uncover the mystery of how pharmacy benefit managers (PBMs) affect escalating pharmaceutical drug prices.”

“Consumers and pharmacists have been burdened by a complete lack of transparency and one-side, take-it-or-leave-it conditions thrust upon them by PBMs for far too long,” noted California Pharmacists Association (CPhA) CEO, Jon Roth in a press release. “AB 315 is an important step in beginning to unveil exactly how consumer’s prescription drug benefit plans are financed and managed.”

The law was supported by AARP California, Chronic Care Coalition, California Labor Federation, California Medical Association, California Pharmacists Association, Health Access, Consumers Union, the San-Francisco-based HIV/AIDS advocacy group Project Inform and others.