March 5, 2024

Cuban Recommends Radical Change In Drug World To Reduce Costs

I am a big fan of Mark Cuban and what he and his Cost Plus Drugs are doing to reform the drug price system.  So when he speaks, I listen.  At a White House round table, Cuban proposed that federal programs cut off all ties to traditional pharmacy benefits managers (PBMs) and embrace full transparency.  He has a direct-to-consumer firm and various transparent PBMs are all in on this idea.  

The White House liked the transparency idea but knows it is easier said than done and there are many barriers to unravel what we have now. I note that the transparency model emerging right now works well for generic drugs, but it will be harder and take more time for brand drugs, especially until we get prices lower and solve for the shadowy rebate system.

But Cuban’s transparency and frankness is where the drug world needs to go. Cuban and advocates for reform also noted that at least some of the shortages we are seeing now are caused by the traditional opaque pricing and delivery channels. Cost Plus Drugs will begin manufacturing generics, targeting some with major supply issues. Hopefully Cuban’s radical approach gets people to think differently. PBMs need to reform. Brand drug makers have to embrace lower prices while safeguarding innovation. Direct-to-consumer models are the way to go.

Additional article: https://insidehealthpolicy.com/inside-drug-pricing-daily-news/biden-admin-urged-cut-ties-top-pbms-achieve-lower-drug-costs

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#drugpricing #cuban #costplusdrugs #pbms #healthcarereform

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Medicare Advantage Enrollment Report Shows Major Growth

Good article on a recent study of Medicare Advantage growth in 2024. I came to similar conclusion in the following blogs: https://www.healthcarelabyrinth.com/great-news-for-insurers-and-medicare-beneficiaries-january-2023-to-january-2024-medicare-advantage-growth-rebounds/ and https://www.healthcarelabyrinth.com/medicare-advantage-enrollment-growth-continued-from-january-to-february/ .

#medicareadvantage #enrollment

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More On Change Healthcare Cyber Attack Fallout

The federal government is taking heavy heat over what some providers view as its lackluster response to the Change Healthcare cyber attack. This follows attacks on UnitedHealth Group for what was characterized as a paltry assistance program for providers.

Department of Health and Humans Services (HHS) Secretary Xavier Becerra issued a rather unprecedented press release outlining aid the federal government will provide, including requested relaxation of prior authorization rules by MA plans, help on alternative electronic transmissions, as well as the possibility of advanced payments. Change Healthcare is slowly but surely getting technology back up and running, but impacts are still major.  Hospital groups panned CMS’ plans as inadequate.

HHS press release: https://www.hhs.gov/about/news/2024/03/05/hhs-statement-regarding-the-cyberattack-on-change-healthcare.html

Additional article: https://insidehealthpolicy.com/daily-news/hhs-facing-aha-pressure-takes-steps-address-cyber-attack

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#changehealthcare #cybertattacks #providers #hhs #cms

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Kaiser And Other Insurers Cutting Jobs

Kaiser Permanente announced further job cuts, including layoffs in its IT technology area.  Part of the cuts tie to outsourcing of services, which is a major change for insurance giant.

Additional article: https://www.healthcaredive.com/news/kaiser-layoffs-it-workers-cut-costs/709316/

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#kaiserpermanente #layoffs

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Feds Open Private Equity Investigation

Federal regulators launched an investigation Tuesday probing private equity firms’ investment in healthcare.

The Federal Trade Commission, Justice Department and Health and Human Services Department will open an investigation into private equity firms’ role in healthcare.  It begins with soliciting input through a request for information (RFI) process.  The RFI states concerns that such deals may generate profits at the expense of patients’ health, workers’ safety and affordable care.

The move is part of a broader anti-trust effort in healthcare that the Biden administration promised.  This is one area that I support, whether provider or plan oriented.  There is little doubt that consolidation has raised prices in many ways and that there are negative consequences on quality.

A related article discusses the growth in private equity’s control of physician groups. A study says it grew seven-fold between 2012 and 2021. I urge regulators to look at the control hospitals and health systems have over physicians, whether private equity backed or not. The study found that control is especially concerning in specialty areas.

Department of Health and Human Services (HHS) press release: https://www.hhs.gov/about/news/2024/03/05/issue-request-for-public-input-as-part-of-inquiry-into-impacts-of-corporate-ownership-trend-in-health-care.html

Physician control article: https://www.modernhealthcare.com/mergers-acquisitions/private-equity-acquire-physician-groups-study-ftc

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#privateequityfirms #antitrust #providers

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Whistleblower Lawsuit Against Accountable Care Organization

A whistleblower lawsuit says a prominent accountable care organization (ACO) and some physicians conspired to defraud the government through upcoding. It alleges that both personnel and software played a role. The federal government has not elected to join the case right now, which could call into question the strength of the allegations. But it could join later.

#fwa #acos

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Biden Pivots To Healthcare To Win Votes

Good article on President Biden’s emphasis on healthcare issues to help bolster his prospects in November against sagging polls.  I think he is smart to focus here.  As I always say, Republicans have a critical compassion gap on healthcare and the election will be decided in a few states and perhaps in a few regions or counties across the United States. 

In fact, the Kaiser Family Foundation President and CEO Drew Altman makes the same points here: https://www.kff.org/other/perspective/its-not-a-health-care-election-but-health-issues-might-still-add-up/

Refresh on my blogs on the issue here: https://www.healthcarelabyrinth.com/republicans-have-a-compassion-gap-but-trump-gives-democrats-momentum-on-healthcare-anyway/ and https://www.healthcarelabyrinth.com/new-poll-shows-americans-want-to-work-to-improve-the-current-healthcare-system-not-replace-it/ .

#healthcare #healthcarereform

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Hospitals And PBMs Dodge Big Reforms

So far, hospitals and PBMs have dodged big reforms.  I am less inclined to believe all the changes proposed for PBMs were merited, but do support site neutral policies for hospital payments in Medicare.  For now, the article suggests dysfunction and strong political lobbying saved these entities from changes.

#hospitals #pbms #drugpricing #siteneutral

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Heritage Action And Freedom Caucus Oppose Spending Bill

Both Heritage Action (a conservative group) and the House Freedom Caucus (made up of rightist Republicans and from which the House Speaker Mike Johnson hails) oppose the agreed-upon spending bill.  The Freedom Caucus is urging lawmakers to oppose it.  But the caucus is not yet ready to force a vote on Johnon’s ouster. The bill is likely to garner enough Democrat and Republican votes in each House to pass in two bills.

Additional article here: https://thehill.com/business/4510379-conservative-heritage-action-opposes-spending-package/

#governmentshutdown #spending

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Arizona To Help Cancel $2 Billion In Medical Debt

Arizona will use $30 million in American Rescue Plan Act funds to cancel about $2 billion in medical debt for about 1 million residents. This mirrors other city and state actions where a non-profit negotiates settlements.

A good and righteous cause.

#medicaldebt #healthcare

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Florida Drug Importation In Question

This article gives good background on the Florida drug importation waiver.  We know progress will be slow and its success is in question. But anything should be tried to lessen drug price burdens.  Of course, Brand Pharma calls all of this reckless.  But it is largely propaganda.

#drugpricing #drugimportation

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— Marc S. Ryan

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