Wednesday, August 15, 2018

You Must See The Bleeding Edge

Americans value innovation, and we built a health care system that rewards it, but at what cost? Few people understand that medical devices are not regulated as well as pharmaceuticals and patients can have untested objects implanted in their bodies. 

Prescription drugs must be tested in humans, and the FDA reviews the data before they're approved to go to market. The process has its shortcomings, but nothing like what goes on with medical devices. Through a what is essentially a loophole, the 510(k) pathway, medical devices can be approved if the manufacturer demonstrates that their device is "substantially equivalent" to a device that's already on the market. Manufacturers can get approval even if the device they're using for the comparison has been recalled because it caused problems. The new device might be made from entirely different material like using cobalt in a hip replacement or used in a completely different way like mesh that was used for hernia repairs being used for gynecological repairs. Under the current administration, what little control the FDA had is eroding. 

Wednesday, August 1, 2018

Nine Actions to Mitigate Specialty Drug Costs

I was asked to give a presentation at the Employee Health, Benefits, & Well-Being Congress in Boston about what employers can do to manage specialty drug costs. The timing was good, ASHA's PBM contract is out to bid and I've spent the last four months learning what I need to know to evaluate our options. I was happy to share what I've learned and will summarize what I shared here as well with links to some of the things I mentioned. 

Monday, May 28, 2018

Mental Health Care -- Far from Equal (Part 2)

4 Helpful Actions Employers Can Take

It's been 10 years since the Mental Health Parity and Addiction Equity Act was passed, so it seems like a good time to pause and ask ourselves if access to care is now equal. M
ost insurers have dropped visit limits and separate deductibles and co-insurance for mental health care yet patients are still struggling to get access to treatment. A report from Milliman concluded:
The difference between medical/surgical and
behavioral health use out-of-network by state.
 Source: Milliman - 2017
  • In 2015, behavioral care was four to six times more likely to be provided out-of-network than medical or surgical care.
  • Insurers pay primary care providers 20 percent more for the same types of care as they pay addiction and mental health care specialists, including psychiatrists.
  • State statistics vary widely. In New Jersey, 45 percent of office visits for behavioral health care were out-of-network. In Washington D.C., the figure was 63 percent.6
In part, because reimbursement rates are low, mental health practitioners choose not to participate with insurance networks. Participation also means dealing with all the paperwork and bureaucracy involved in filing insurance claims. Many mental health care providers are solo practitioners and they don't have the administrative support they need to deal with insurance coverage.

Wednesday, April 18, 2018

Sewage Leaks in DC Hospital Operating Rooms

The next time you are tempted to think, "all hospitals are equally safe," stop and think of this story about sewage leaks in the operating rooms at MedStar Washington Hospital Center. These leaks are cited as a cause of patients acquiring infections while in the hospital and the cause of the death of a woman from Northern Virginia. 

Leapfrog Hospital Safety Grade assigned Washington Hospital Center a safety grade of a D the last four times safety was evaluated.  The results clearly show they scored below average in infections. Sibley Memorial Hospital is just six miles away and it earned a B. Knowing this, where would you choose to seek care? 

I understand people put a lot of trust in their doctors and generally go wherever their doctors recommend, but it's up to you to choose where to seek care. I'm not exaggerating when I say this can be a life and death decision. 

The good news is that the information you need to make a well-informed decision is easy to obtain. Just go to Leapfrog Hospital Safety Grade and search by state, city, zip code or hospital name. Leapfrog even has an app you can load onto your phone, so this information is always at your fingertips.  

Tuesday, April 10, 2018

Mind the Gap

April 10 is equal pay day. It symbolizes the date when working women’s wages catch up to what men were paid the previous year--how far into 2018 women have to work (on average) to earn what men earned in the 2017 calendar year. Pew Research Center reported that in 2015, women earned 83% of what men earned. So, the gap is narrowing (you've probably seen the often sited 79 cents on the dollar statistic), but still persistent.  

The wage gap compares women’s wages to men’s on a very broad scale. It’s stated as a very broad statistic, women earn 83 cents on the dollar, or used to compare women’s’ wages to men’s wages within industries. Sarah Kliff at Vox wrote this article that clearly explains the wage gap. Some of the gap is certainly due to discriminatory practices, but the preferences of women also have an impact. The Gender Pay Gap persists despite equal pay laws. This white paper from Denmark explains how gender inequality in earnings stems from women's preferences after they have children.

Pay equity compares what women earn to what men earn for doing the “same work.” States are enacting pay equity laws because pay equity is viewed as something that’s within the employers control. Last year, I laid out a 10 step process for employers to follow to eliminate pay inequities. I’m proud to say it’s worked for ASHA.

Tuesday, April 3, 2018

Consumer-Focused Approaches Won't Curb Health Care Spending

Image from
The U.S. spends roughly twice what other developed nations do on health care. With all that money, we buy the lowest life expectancy and the highest infant mortality rate. Americans don't use more services than people in other high-income countries; we pay more the services we receive. 

In the fourth quarter of last year, health care surpassed retail and manufacturing to become the largest source of jobs in the United States. Health care is a huge driver in our economy, and one person's excess is another person's income. Putting pressure in one area to control costs is like squeezing a balloon--it increases the cost somewhere else. If we're going to spend more than every other country on health care, it would at least be nice to spend that money on things that improve people's health. We need greater transparency around the effectiveness and cost throughout the system, but especially with prescription drugs.

NPR put a human face on the problem in this story about a woman who's health reimbursement account was wiped out by a prescription for Kerydin--a $1,500 treatment that cures toenail fungus in 6.5% of the patients who use it.

Prescription Drug Spending in the U.S. Health Care System, provides a good overview of the issues. Policy Strategies for Aligning Price and Value for Brand-Name Pharmaceuticals describes options for value-based pricing.

What's the best approach for employers? Do you chase rebates or move toward value-based plan design. Today, employers cannot afford not to chase the rebates. If the Chronic Disease Management Act that was introduced in Congress in February becomes law, employers will have more tools at their disposal. The act would allow employers to cover some treatments without subjecting them to a deductible. This could lead to more innovative plan design. Reform is needed throughout the system though. Consumer-focused approaches won't curb spending unless we begin to align drug prices with the clinical value the drugs provide. 

Saturday, February 17, 2018

5 Reasons You Didn't Get a Bigger Raise This Year

Wage growth has been stable at 3% across the country and in Europe and Japan since we got out of the recession in 2008. Three percent doesn't allow for a lot of differentiation in salary increases across an organization, so it's likely your raises have been pretty unimpressive. It's been ten years since the economy tanked, so why aren't employers putting more money into salary increases?
Data from Quatt Associates

  1. With every employer setting salary increase budgets at 3%, employers are under no pressure to do more than that. Matter-of-fact, you look pretty irresponsible to your board if you set a much larger budget. How would you justify it?
  2. There is evidence that companies have shifted money into bonuses rather than base pay increases. Bonuses are much more nimble than base pay. It’s easier to forgo bonuses if profits are not meeting expectations than to cut salaries or lay people off.

Saturday, February 3, 2018

Tackling Health Spending

On Thursday, the National Pharmaceutical Council (NPC) and Health Affairs launched a new initiative to address health spending called Going Below the Surface. It's is a "research-first endeavor dedicated to unearthing and examining the drivers of health care spending in the United States, and convening a multiple-stakeholder discussion to better understand what we receive for these investments."  The U.S. spends 18% of GDP on health care which is far more than any other country. And, despite all that money, we have worse outcomes.

David Cutler from Havard University shared a few shocking comparisons. The one that has stuck with me is Duke University Hospital has 900 hospital beds and 1,300 billing clerks. Do you think maybe we could save some money by streamlining how we pay for care?

Amitabh Chandra from Havard University showed this cost curve to illustrate how the first health care dollars spent extend life significantly, but you quickly reach a point where we're spending half a million dollars to extend a person's life by a matter of days. This leads to the tough questions. Who decides where the time isn't worth the expense? Is there one answer for everyone in the country or could individuals choose the coverage they want? 

Wednesday, January 24, 2018

We're Dying Earlier in the U.S. While People in Other Countries are Living Longer

Our life expectancy in the U.S. decreased for the second year in a row in 2016 to 78.6 years. The drop looks small at first blush -0.1 years, but it's alarming. Life expectancy in the United States is lower than in most other OECD countries and the gap is getting wider--we're dying earlier in the U.S. while people in other countries are living longer. I could not do as good a job of explaining why as Bill Gardner did in this post, so I recommend you read his explanation. 

How are people dying? These are the leading causes of death according to the CDC.
  1. Heart Disease
  2. Cancer
  3. Accidents
  4. Chronic lower respiratory disease
  5. Stroke
  6. Alzheimer's
  7. Diabetes
  8. Flu and pneumonia
  9. Kidney disease
  10. Suicide
The rate of death decreased for seven of these 10, but increased for accidents, Alzheimer's and suicide. We also know drug overdose deaths rose an appalling 21% from 2015 to 2016