Cartoon – The Problem
Monthly Archives: January 2021
Cartoon – Time to Rise Above
Cartoon – A Measured Response
Cartoon – Some Ethical Roadblocks
Cartoon – Orbit of Trusted Friends and Advisors
Cartoon – Importance of Likability
Drugmakers sue HHS over 340B advisory opinion in feud over contract pharmacy access
Drug companies AstraZeneca, Eli Lilly and Sanofi filed separate lawsuits seeking to preserve their ability to restrict offering 340B-discounted drugs to contract pharmacies.
The lawsuits, filed Tuesday in different federal courts, seek to get rid of an advisory opinion filed by the Department of Health and Human Services’ (HHS’) general counsel that says drug companies must offer 340B drugs to contract pharmacies, which are third-party entities that dispense drugs on behalf of hospitals participating in the program.
The drug companies argue that the advisory opinion contracts the statute for the 340B program, which requires manufacturers to offer discounted products to safety net hospitals and other providers in exchange for participation in Medicare and Medicaid.
“The statute, on its face, does not require manufacturers to recognize any contract pharmacies, much less unlimited contract pharmacies,” the legal filing from AstraZeneca said.
AstraZeneca wants a federal court to declare the advisory opinion didn’t follow proper procedure and exceeded HHS’ statutory authority. The manufacturer also wants a court to declare that companies are not required to offer 340B discounts to contract pharmacies.
The lawsuits come less than a week after the American Hospital Association (AHA) and five other groups and three individual systems sent letters to the drug companies that have halted or restricted sales to contract pharmacies. They wanted the drugmakers to reinstate sending the discounted products to their pharmacies and reimburse facilities for any damages.
AHA and several groups sued HHS to get the agency to clamp down on the drug manufacturers’ moves.
AstraZeneca, Eli Lilly, Novartis, Novo Nordisk, Sanofi and United Therapeutics have taken a range of actions to clamp down on sales to contract pharmacies, which a majority of 340B-covered entities use.
The companies have argued that the discounts do not filter down to patients, but hospital and advocacy groups charge that the discounts are vital, especially as safety net providers operate on thin margins.
“Make no mistake: the boom in contract pharmacies has been fueled by the prospect of outsized profit margins on 340B discounted drugs,” AstraZeneca argued in its court filing.
Pandemic propels health systems to mull insurer acquisitions, partnerships
Nearly a year after the first confirmed case of COVID-19 in the U.S., some of the nation’s largest health systems made a case for the need to accelerate toward value-based arrangements and potentially acquiring or partnering with health plans to become an integrated system.
Amid new records for deaths and cases from the novel coronavirus, executives gathered virtually for J.P. Morgan’s 39th annual healthcare conference, which typically draws prominent healthcare leaders to San Francisco at the start of each year.
The pandemic has been a heavily discussed topic during the digital gathering. One theme has been health systems either acknowledging they are on the hunt for health insurer acquisitions and partnerships or advocating for such arrangements as result of the challenges.
Anu Singh, managing director and the leader of the mergers, acquisitions and partnerships practice at consultancy Kaufman Hall, said it’s a natural migration for health systems, though it does come with some risk.
“If you want to move into the realm of being a population health manager, and take greater responsibility for your patient bases, you’re going to have to be thinking about maintaining their health,” Singh said. “And that’s typically something that, at least traditionally and historically, has been driven a little bit more by the health plan.”
For Utah’s Intermountain Healthcare, the lessons of the pandemic are clear: The industry needs to move away from a system that rewards volume. Intermountain is a fully integrated system that manages both providers and an insurance unit.
“It is becoming increasingly apparent that systems that are well integrated, especially systems that understand how to take risks, have prospered in the face of the terrible burden, caring for people in the midst of the first pandemic in 100 years,” Intermountain CEO Marc Harrison said Monday.
From his vantage point, Harrison said it has been interesting to watch the consternation around telehealth visits.
“Lots of folks who are really still caught in the volume-based system are actively switching patients back from tele- or distance to in-person visits so they can maximize revenue,” he said. “I understand that. But that’s a really great example of poorly aligned incentives.”
Intermountain has managed to stay in the black as many other systems have struggled financially as a result of the pandemic driving down patient volumes. It reported net income of $167 million through the first nine months of 2020, compared with $919 million the year prior.
Another integrated system, Baylor Scott and White Health, the largest nonprofit system in Texas, said such diversification has helped buoy its finances as hospital and clinic operations bottomed out in the spring due to the virus.
Baylor Scott and White illustrated this point by showing how operating income for its clinical segment took a nosedive in the spring while operating income for its health plan remained relatively steady.
The theme of integrated health systems also seemed to be on the minds of investors. CommonSpirit Health executives were asked during their presentation if buying or creating a health plan was on their radar as the system has a sizable footprint of 140 hospitals across the country.
“I think this is a interesting question, one that of course we’ve discussed many times strategically,” CFO Daniel Morissette said, noting the system does have a number of regional plans. “At this time, we have no plan of having a national CommonSpirit branded plan.” However, Morissette said the system would consider a partnership opportunity.
On the other hand, Midwest-based Advocate Aurora Health said it is actively on the hunt for a potential insurer deal as part of its long-term strategy.
“We do believe that having health plan capability, not necessarily having our own, but partnering for health plan capability, is going to be critical to our success, and we are taking steps to do that,” CEO Jim Skogsbergh said during the virtual conference.
Kaufman Hall said in its latest report that it expects more payer-provider partnerships as a result of the pandemic. “Limitations on fee-for-service payment structures exposed by the pandemic may increase the number of payer-provider partnerships around new payment and care delivery models,” according to the report.
Singh of Kaufman Hall said it’s not surprising that some may lean more toward a partnership due to the risks of starting a new venture, especially an insurance unit that can have “catastrophic loss”. Systems with less experience of moving toward implementing value-based initiatives may be more vulnerable to such risk.
It’s why he thinks partnerships may be a good fit, at least at first. Payers and providers can work together to improve the health of certain populations and then share in the cost savings.
ACA plan enrollment for 2021 ticked up slightly
Dive Brief:
- Consumers choosing insurance via the federal Affordable Care Act exchanges reached 8.25 million over the 2021 open enrollment period, about the same number as the year before, CMS said Wednesday.
- Because two fewer states are participating in the federal marketplace this year, adjusted year-over-year growth in plan selections was 7%, the agency said.
- Of the total, 23% of consumers were new, down by 3.6%. Renewing consumers who actively chose a new plan and those who were automatically re-enrolled both increased.
Dive Insight:
The figures are the last from the Trump administration, which has drastically reduced money toward navigators who help people use the Healthcare.gov website and find the best ACA plan for them. The administration has made no secret of its opposition to the law and after failing to overturn it in Congress has used executive actions to undermine it.
Still looming is the Trump administration’s lawsuit seeking to overturn the landmark law.
President-Elect Joe Biden and his pick for HHS chief, California Attorney General Xavier Becerra, however, are eager supporters and are likely to take a number of actions to restore and burnish it. That could be increasing tax credits and subsidies, increasing navigator funding and building on protections like essential health benefits.
The U.S. Supreme Court is expected to make its ruling on the ACA case later this spring or summer, but the Biden administration could essentially make it moot by walking back the zeroing out of the individual mandate penalty that is the linchpin of the lawsuit against it.
The relatively steady enrollment could be increased through those actions and the possibility of a special enrollment period to account for needs during the coronavirus pandemic. The COVID-19 crisis and the recession it has caused have kicked millions of people off their employer-sponsored insurance, and they could turn to the exchanges for coverage, especially with higher tax credits and subsidies.
Past Covid-19 Infection Gives Vaccine-Like Immunity For Months, Study Finds
TOPLINE
Most people who have recovered from Covid-19 have similar levels of immunity against future infection to those who received a coronavirus vaccine, a study by Public Health England found, offering early hope against fears of a short-lived immunity spurred on by reports of people catching the virus twice, though the researchers warn that those with immunity may still be able to carry and transmit the virus to others.
KEY FACTS
Naturally acquired immunity from a previous Covid-19 infection provides 83% protection against reinfection when compared with people who have not had the disease before, government researchers found in a study of more than 20,000 healthcare workers.
The study, which has not yet been peer reviewed for rigor by other scientists, shows that this protection lasts for at least five months and is at a level just below that offered by vaccines from Pfizer-BioNTech (95%) and Moderna (94%) and significantly above that of the vaccine developed by the University of Oxford and AstraZeneca (62%), though manufacturers don’t know for how long this immunity lasts.
The figures suggest reinfection is relatively rare — occurring in fewer than 1% of the the 6,614 people who had already tested positive for the disease — though the scientists warned that while “those with antibodies have some protection from becoming ill with Covid-19 themselves,” early evidence suggests that they can carry and transmit the virus to others.
“It is therefore crucial that everyone continues to follow the rules and stays at home, even if they have previously had Covid-19, to prevent spreading the virus to others,” Public Health England wrote.
The study will continue to follow participants for another 12 months to determine “how long any immunity may last, the effectiveness of vaccines and to what extent people with immunity are able to carry and transmit the virus,” as well as investigate the highly-contagious new variant of coronavirus spreading across the U.K..
CRUCIAL QUOTE
Professor Lawrence Young, a virologist and Professor of Molecular Oncology at Warwick Medical School in England, said an important takeaway from the study is that we don’t yet know how long antibody protection will last outside of the five month window. He said it is “possible that many people who were infected during the first wave of the pandemic may now be susceptible to re-infection.” Young said it will be interesting to see whether people previously infected with Covid-19 and are subsequently vaccinated have “an even longer-lived protective immune response” and whether or not these findings hold true for the new virus variant currently spreading in the U.K..
WHAT TO WATCH FOR
The information gathered from reinfection cases could prove important as the pandemic progresses, especially when it comes to designing and implementing an effective vaccination program and deciding whether to ease lockdown measures. Whether or not those who are immune to serious illness are capable of transmitting the infection to others will be a crucial deciding factor.
WHAT WE DON’T KNOW
It’s not yet clear for how long the protection provided by vaccines last. This will have to be studied over time, as with this case of natural immunity, and is something manufacturers are already doing. Moderna believes their vaccine offers at least a year’s protection against disease. Whether or not this protection prevents individuals from infecting others will also need to be figured out.
BIG NUMBER
384,784. That’s how many people have died from Covid-19 in the U.S. since the pandemic began, according to Johns Hopkins university. According to CDC projections, this figure is set to grow 25% in the next three weeks. At the moment, more than 23 million people have contracted the disease in the U.S..
HENRY KOTULA 