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Health Industry Leader Offers a Medicare Advantage Solution

February 04, 2021
10:27 am

Politically, the notion of “Medicare for All” is a non-starter. Americans have consistently resisted the idea of a major government health coverage expansion that would take away the private plans they currently have and value.  Nonetheless, we’re still faced with the challenge of how to achieve universal coverage, provide all Americans access to high-quality care, and address the health inequities that currently exist.

Dr. Sachin H. Jain, president and CEO of SCAN Group and SCAN Health Plan and a member of the Healthcare Leadership Council, advised in a Modern Healthcare op-ed that the focus has been on the wrong type of Medicare expansion. If this country is going to build upon proven successes, Dr. Jain points out that Medicare Advantage, operated by private health plans, outperforms traditional Medicare with lower annual beneficiary costs, superior health outcomes, and high popularity among seniors. Opening up broader access to Medicare Advantage plans is another way to address the health inequity issues that remain a serious challenge.

Dr. Jain’s full op-ed is provided below.


Medicare for All? The better route to universal coverage would be Medicare Advantage for All

Dr. Sachin H. Jain

President-elect Joe Biden won election with a mandate to continue the healthcare reforms begun by President Barack Obama. On the campaign trail, Biden pledged to protect and build on the Affordable Care Act.

Many people have urged Biden to make good on his promise by implementing “Medicare for All.” That would be a mistake. There’s a better system out there—and for more than two decades, it has successfully relied on public-private partnerships to expand access to care, lower costs and improve outcomes for millions of Americans. What the country needs is “Medicare Advantage for All.”

Under traditional Medicare, the government pays doctors and hospitals for individual services, tests and procedures. Under Medicare Advantage, the government sends capitated payments to private insurers—including not-for-profits—which, in turn, are charged with providing highly coordinated, whole-patient care to beneficiaries.

Introduced in their current form in 1997, Advantage plans have proven wildly popular among the mostly older adult populations they cover. That’s in large part because the plans are able to offer a wider array of health-related benefits than traditional Medicare. They commonly charge no premiums, cover prescription drugs, and include no- and low-cost vision and dental benefits. Many offer gym memberships, acupuncture and chiropractic coverage, as well as transportation options to get patients to their appointments.

As popular as these plans are with consumers, that’s not the primary reason to expand their availability. The fact is, Advantage plans outperform traditional Medicare, producing better outcomes at lower costs for both the government and beneficiaries alike. A recent study, for example, looked at people with chronic conditions and found that Advantage plans performed better on several key quality measures, including avoidable hospitalizations and higher rates of preventive screenings.

Likewise, a separate study found that annual beneficiary costs for Advantage enrollees are about 40% lower than for those in traditional Medicare. And because, by law, Advantage plans come with maximum out-of-pocket limits, beneficiaries are protected from the costs that cause traditional Medicare beneficiaries to purchase private “Medigap” plans to supplement their coverage.

As for the government’s portion of the bill, it’s impossible to know exactly how much any “public option” might cost taxpayers without knowing the details of each proposal (Will there be premiums? How much are co-payments? What types of benefits will be included?). Nevertheless, past practice demonstrates that it costs less to care for Advantage enrollees. Humana, for example, just reported that the cost to care for members in its Advantage plans was 19% less than for traditional Medicare enrollees.

At the same time, it’s essential to note that much of this savings derives from the value-based payment contracts baked into most Advantage plans. And that could present a challenge, because Americans often say they want to see any doctor in any network of their choosing. That vision is incompatible with most Advantage plans, which derive their savings—as well as the cohesion of care they provide—from managed-care networks which, by definition, limit one’s choice of providers.

On the other hand, knowing that the coordinated care these networks provide produces better health outcomes and that the private insurers that administer Advantage plans have proven track records collaborating with public officials to design affordable plans that deliver consumer choice and excellent outcomes would surely appeal to a broad swath of the populace. What’s more, growing Medicare Advantage would not require a massive expansion of the federal government’s role in healthcare, something the majority of Americans consistently say they oppose.

President-elect Biden has said that he wants to offer Americans the ability to buy into “a public health insurance option like Medicare.” The best such option is Medicare Advantage. It’s widely relied upon by our parents and grandparents. And in these times of economic uncertainty, it’s time to make it available to everyone.

Dealing With Disaster: Applying Lessons Learned from a Pandemic

November 30, 2020
1:49 pm

As COVID-19 has maintained its grip on the United States, there has been an increasing focus on learning from emergency response successes and mistakes in order to prepare the nation’s healthcare system for the next local or national disaster. Hospitals and healthcare workers in particular have experienced the chaos, uncertainty and stress of caring for patients while, at times, lacking critical data as well as adequate supplies of equipment.

Recognizing the need for a segment of the healthcare workforce to specialize in healthcare crises, ICAP at Columbia University and the Dalio Center for Health Justice at NewYork-Presbyterian launched the REACH (Responding to Epidemics and Crises in Health) Fellowship. The program is utilizing a mix of education, training and mentorship to achieve a comprehensive approach and will include participants with diverse healthcare backgrounds.

Dr. Steven J. Corwin, President and Chief Executive Officer of NewYork-Presbyterian Hospital emphasized the continued commitment of his staff in addressing COVID-19 and said the lessons learned on the ground will be thoroughly studied within the Fellowship. It is no surprise that one of the first collaborations of this nature has been initiated in one of the early coronavirus hot spots. As more time passes, additional institutions will certainly create similar programs.

Individual actions are vital for progress in handling any form of crisis that affects the healthcare system, however a coordinated approach that brings the industry together is unquestionably a necessity. The Healthcare Leadership Council (HLC), of which NewYork-Presbyterian Hospital is a member, has been working with the Duke-Margolis Center for Health Policy and over 75 healthcare organizations to develop recommendations for a private-public partnership that will include an advanced coordinated plan formed and agreed upon by the healthcare industry and federal officials. Through the National Dialogue for Healthcare Innovation (NDHI), HLC and the Duke-Margolis team have led meetings and hosted a summit of healthcare executives and leaders within multiple government agencies to work out the details on this partnership. A final report will be distributed in early 2021. As this pandemic lingers, we can be sure that new lessons are on the horizon and the path forward is through innovation and collaboration.

We Need a Patient-Centered Approach to Pharmaceutical Affordability

October 07, 2020
3:19 pm

There is universal agreement in our country that lifesaving and life-strengthening treatments and therapies should be widely accessible and affordable. The question is how to achieve this objective in a way that encourages medical innovation and continues a flow of breakthrough medicines that can enable more victories over diseases that have affected generations.

In an op-ed in Politico, Genentech’s senior vice president for access and external affairs, Fritz Bittenbender explains convincingly why the Administration’s proposal to link drug prices in the Medicare Part B and Part D programs to those of foreign countries that employ government price controls will, in his words, have “enormous negative consequences for the future of scientific innovation in America.” (Genentech is a member of the Healthcare Leadership Council.)

He proposes an alternative approach that would achieve greater affordability through enhanced competition and an “indication-based pricing” that would tie price to the value of medicines in specific indications of use with varying patient populations.

This op-ed is an important contribution to the pricing discussion taking place in political and policy circles today.

Breakthrough science demands equally bold policy — and pricing — solutions

By FRITZ BITTENBENDER, SVP, ACCESS & EXTERNAL AFFAIRS, GENENTECH

Earlier this month, the President followed through with his threat to issue an executive order to implement a ‘Most Favored Nations’ (MFN) pricing policy, aimed at reducing the escalating and unaffordable financial burden patients face as they seek medical treatment. The President’s aims are right but the policy is flawed, with enormous negative consequences for the future of scientific innovation in America. At Genentech, we have long advocated for, and advanced, proactive policy solutions to create a more accessible and equitable healthcare system. But the President’s proposed solution — one of importing pricing practices from countries that value healthcare and human lives differently than the United States — is unfortunately not one that will benefit the American people in the long-run. And it comes at a time when the biopharmaceutical industry is waging war against COVID-19 through an “all-hands-on-deck” campaign to develop safe, effective vaccines and treatment regimens, with approximately 1,500 active clinical trials currently in progress.1

As someone who has spent his entire career in the healthcare space, and whose colleagues engage daily with policymakers, private sector leaders, and patient advocacy groups on potential solutions, I can tell you what will work: market-based policies that dramatically lower patient out-of-pocket costs while encouraging the continuation of robust research and development (R&D) that leads to important medical breakthroughs; more companies like Genentech that commit boldly to responsible medicine pricing; and the willingness of all parts of the healthcare ecosystem to put aside differences and work together to drive solutions for American patients.

The proposed MFN policy, which has been expanded to include pharmacy (Part D) medicines in addition to physician administered (Part B) medicines, would import arbitrary price controls from other countries into America and introduce new middlemen into the reimbursement landscape. Concerns from across the healthcare continuum are well-known, highlighting a long list of issues, including the impact on R&D investment — particularly for biotech startups — severe financial burdens on community physicians, and monetary incentives taking precedence over a clinician’s treatment recommendation for their patients.

At Roche and Genentech, we invest nearly $12 billion per year in R&D, more than any other healthcare company in the world. Let’s be clear: biopharmaceutical innovation through the U.S. private market is essential to develop safe and effective vaccines and treatments for COVID-19. It is also our only hope for the next big public health crisis, such as antimicrobial resistance (AMR), or for countless other diseases including cancer, Alzheimer’s disease, and rare disorders with no treatment options. A MFN policy threatens this medical progress for patients and contradicts the President’s May 19, 2020 executive order on regulatory relief, which called for removing “barriers” to the “innovation, initiative, and drive of the American people.” The President’s own Council of Economic Advisors released a report that indicated that international reference pricing policies like MFN will lead to 100 fewer new medicines being approved for patients in the next decade.2

Setting aside this dangerous impact on medical innovation, the MFN policy does not address any other factors that determine the actual cost of a medicine for any given patient — from no insurance or high deductibles and coinsurance to hospital mark-ups. There are other innovative ideas that could deliver much-needed savings without the impact to medical innovation or restricting patient access to new medicines. Genentech, working with other companies and our trade associations, has been actively engaged in putting forward these types of recommendations that promise to generate billions of dollars in savings, including responsible pricing actions, innovative payment models, and new free-market competition mechanisms.

In 2018, for example, Genentech put forward a market-based pricing model that would accelerate competition for Part B medicines in the commercial sector, allow Centers for Medicare & Medicaid Services to capture the benefits of negotiations between manufacturers and private payers, and reduce costs for a much larger proportion of patients than MFN.

Another potential solution is indication-based pricing, which would enable companies to price differently based on the value of each medicine in specific indications of use with varying patient populations. This would be particularly helpful in the pandemic setting, where medicines that were originally intended for disease areas with small patient populations are being researched for COVID-19 and, if approved, could end up treating millions of patients globally.

We believe these are necessary components of an effective long-term strategy to alter flawed reimbursement mechanisms because they leverage the proven free-market system that has long spurred American innovation, and they can bring real savings to patients.

It is imperative that the medicines we develop are accessible to anyone who is prescribed them. And that means it’s not just policy that should change. Companies must think differently about price increases. The existing model, which incentivizes companies to dramatically increase the prices of their medicines annually and then rebate back significantly to a middleman for preferred coverage, does not in any way benefit patients — and it perpetuates the rising cost of medicines. It is time for rebate reform that passes saving onto patients, coupled with each company taking smaller price increases based on careful consideration of factors including inflation, continued investment in research of medicines, or enhanced patient benefit proven through clinical research and real-world evidence.

At Genentech, we are committed to doing our part through a responsible approach to pricing. As an industry leader, we have taken on this responsibility, facing head-on the challenges of creating a comprehensive workable solution. Over the last several years, Genentech has launched 13 groundbreaking medicines in areas of great need, including multiple sclerosis, hemophilia, spinal muscular atrophy and different types of cancer and we’ve priced these medicines at or below (and in some cases significantly below) other available FDA-approved medicines used to treat the same disease.

Moreover, in 2019 alone, through Genentech Access Solutions we served more than 287,000 people and 50,000 eligible patients were provided free medicine by the Genentech Patient Foundation. More than ever we are committed to our mission to discover and develop innovative therapies and equally committed to ensuring patients can access them.

The most impactful breakthroughs for the toughest medical conditions of our time were not born out of siloed thinking or in service of scoring political points. They were the result of a rigorous scientific approach, built on a diverse base of knowledge acquired over time and measured on whether or not they could have a statistically significant impact on the challenges they set out to address.

At Genentech, we believe it is time to apply the same bold thinking that’s behind our life-changing science to our policy solutions and to our pricing philosophy. This means finding a solution that truly improves upon the healthcare system we have in the United States without jeopardizing it. One that values patient life, innovation, and the ability of patients to access new medicines at a price that is cost-effective. This means finding a solution that is strategic, deliberate and structured. This means ending the cycle of finger-pointing, maneuvering, and blame-shifting that has plagued the crisis of unaffordable healthcare in this country.

We call on our industry, and policymakers in Washington, to work together to bring diverse perspectives to the table, generate fresh ideas that are designed to address the challenges of our unique healthcare system, and pressure test those ideas to ensure the proposals that move forward are the ones that are most likely to succeed on behalf of the only stakeholder that really matters: patients.

 

Fritz Bittenbender is Senior Vice President, Access & External Affairs, for Genentech. In this capacity, he has oversight of Genentech’s pricing, contracting, and distribution strategies; external partnerships with associations and patient advocacy groups; and federal, state, and local government affairs teams.

 

 

Enhance and Expand Access to Vaccines

September 16, 2020
3:09 pm

With progress continuing on development of a vaccine for COVID-19, conversations are taking place over the best strategies for distributing a vaccine, once approved, to millions of Americans.  In the post below, two executives from Pfizer – one of the companies involved in coronavirus vaccine development – point out that local pharmacies are a logical vaccination site, but that will also require harmonization of state laws that affect the roles of pharmacists in providing care.

Enhance and Expand Access to Vaccines

By:

Robert Popovian, Pharm.D., MS, Vice-President US Government Relations, Pfizer Inc.

Dave Hering, Regional President, North America, for Pfizer Vaccines.

It was not so long ago, and certainly within the memory of many older Americans, when the fear and uncertainty we are experiencing today with coronavirus were much more common. Before the advent of vaccines for a vast number of diseases, it was not uncommon for people to know friends and family members who had contracted measles, mumps, rubella or polio. Families routinely had to deal with the impact of these diseases on everyday life and, more significantly, manage life-long disabilities like loss of vision, hearing or mobility.

There are scores of studies on the positive impact that vaccination has had on public health. In addition, vaccines are one of the most cost-beneficial interventions in health care. It is estimated that caring for unvaccinated adults costs the U.S. health care system approximately $7 billion per year.

Vaccination rates in the United States for most serious ailments are in the 90th percentile for children, while for adults, the immunization rates are abysmal. For example, less than 50 percent of adults age 19 and older get a flu shot every year. What’s even more alarming is that for adult patients between the ages of 18 and 65 with risk factors (e.g., patients with asthma or chronic bronchitis or smoking history), the rate of pneumococcal vaccination is only 23 percent. Both measures are well below the Healthy 2020 targets set by the U.S. Office of Disease Prevention and Health Promotion.

One approach to encourage adult vaccination is to further expand the ability of community-based pharmacists to administer vaccines. Patients and health systems have benefited most when pharmacists are allowed to immunize patients.

Roughly 9 out of 10 Americans live within 5 miles of a pharmacy that provides vaccination services to patients without an appointment. Community pharmacies offer extended hours of service compared to other sites-of-care, which is especially important for younger, healthier adults for whom immunization rates are exceptionally low.

Also, the evidence is clear that allowing pharmacists to administer vaccines is the lowest-cost alternative for providing this essential public health service. For the most vulnerable adults, our seniors, there may be additional access issues because a majority of family physicians either aren’t stocking or are unable to bill for all available vaccines, especially those reimbursed under Medicare Part D.

Unfortunately, there are significant variations in state laws governing pharmacists’ ability to immunize patients. States that have more restrictions on pharmacists’ ability to provide vaccinations may negatively affect public health and increase health care costs. Therefore, it is of utmost importance for states to expand and harmonize state laws governing pharmacist authority to immunize and allow pharmacists to administer all Food and Drug Administration-approved and Advisory Committee on Immunization Practices (ACIP) recommended adult vaccines.

The recent guidance from Health and Human Services (HHS) allows pharmacists to administer any COVID-19 vaccine, which is FDA-authorized or FDA-licensed, is a step in the right direction. However, the HHS direction under the Public Readiness and Emergency Preparedness Act (PREP Act) is time-limited and mandates that it be based on ACIP recommendation.

Reducing vaccine-preventable disease prevalence and overall health care costs is critical for all Americans. The best way to achieve both goals is through increased vaccination of adults in the United States, particularly at the pharmacy. Policymakers must take the important step of implementing state laws to expand pharmacists’ immunization authority for adults, so we are better prepared if and when the next public health crisis occurs.

On the Precipice of a Major Stride in Healthcare Progress

August 13, 2020
4:49 pm

It actually seems elementary when you think about it.  To deliver the best possible and most cost-efficient care to patients, particularly those with complex chronic conditions, it is essential for all aspects of the healthcare system – primary care physicians, specialists, hospitals, pharmaceutical and medical device manufacturers, pharmacies, and others – to work together to coordinate patient care and deliver comprehensive treatment.

Currently, however, our federal laws and regulations prevent that type of patient-centered collaboration.  Measures known as the Stark Law and the Anti-Kickback Statute were created in the era of fee-for-service medicine to prevent bad actors from acting in ways adverse to a patient’s interests in order to gain some sort of financial benefit.  In our current transition to holistic value-based care, though, these fraud and abuse safeguards are serving as daunting legal barriers to the kind of working relationships that deliver optimal health outcomes.

We are hopeful this is on the verge of changing.  The Department of Health and Human Services has developed, with extensive public input, new rules to modernize these outdated laws and regulations and create opportunities for healthcare professionals and organizations to collaborate without fear of legal reprisal.  There will still be more than adequate protections against fraud and abuse, but the obstacles to patient-centered, value-based care will be significantly alleviated.

These new rules were submitted by HHS to the Office of Management and Budget for final review and approval last month. The Healthcare Leadership Council is one of more than 120 healthcare companies, associations, and patient advocacy groups that has asked President Trump to intervene and bring this critical work across the regulatory finish line.

As the letter to the president puts it, with the finalization of these rules “victory can be claimed in the name of helping get better coordinated care and reducing overall healthcare costs.”  We don’t see any reason to wait to begin reaping these benefits.