Category: Policy and politics

#CareTalk: The Facebook effect on health data

April 19th, 2018 by

What did you think of Mark Zuckerberg’s testimony before Congress, and what does it mean for the privacy of healthcare data?

In this episode of #CareTalk, CareCentrix CEO John Driscoll and I tackle this question along with rumors of a Walmart/Humana tie-up, the nominee for VA Secretary, Obamacare, regulations and Vitamin V.

Enjoy the show -and don’t miss the lightning round!


By healthcare business consultant David E. Williams, president of Health Business Group.

Ten pharma policy topics in just one article!

April 17th, 2018 by

Kaiser Health News is a non-profit news service that does a great job of exploring healthcare policy topics. Still I was impressed that one article (How a drugmaker turned the abortion pill into a rare-disease profit machinemanaged to directly and indirectly raise at least 10 important policy topics.

Here’s my count:

  1. Abortion: A drug on the market to induce abortion appears to be highly effective against Cushing’s syndrome, a condition that can be fatal. Due to mifepristone’s association with abortion, there are tight restrictions on its use and it’s less likely to be prescribed off-label or developed for other conditions.
  2. Orphan drugs: Because Cushing’s only affects about 10,000 people in the US, treatments are eligible for orphan drug status, which provides seven-year market exclusivity for the manufacturer and therefore a chance to make an attractive profit. The orphan drug law can also be abused by jacking up prices on low-cost products.
  3. Drug price levels: The price for Korlym (as the Cushing version of the drug is known) is about $550, compared with $80 for the abortion drug. And the abortion drug is only needed once, whereas the Cushing drug might be needed up to 3x/day forever. The manufacturing cost is presumably close to zero.
  4. Drug price increases: Korlym came on the market at about $220 per pill, but the manufacturer has boosted the price substantially every year, with no end in site. Meanwhile the price of the abortion pill has stayed the same or dropped.
  5. Pharmacy benefit management: The article duly notes that the prices quoted are “before any discounts or rebates.”  Pharmacy benefit managers (PBMs) negotiate discounts and rebates. Depending on what’s happening behind the scenes, it’s possible that the big boosts in list price have not been matched by an equal run-up in actual price realization by the manufacturer, and it’s likely that there are significant differences from one PBM to the next. Meanwhile the PBMs may be benefiting from higher prices, which could boost their own revenues from rebates and other incentives and fees.
  6. Funding of drug development: Corcept Therapeutics, which developed Korlym, is developing a variety of other drugs, which may help more people with Cushing’s or treat aggressive forms of cancer –or may fail completely and help no one. One way the company rationalizes the high price of Korlym is as a source of funding for new drug development. But is there a reason Cushing patients and their insurers should be the source of such funding? Would the company charge less if it didn’t have other drugs in development?
  7. The role of generic drugs: Teva has filed a patent for a generic version of the drug, now that the exclusivity period is coming to an end. That could lower prices for those paying the bill and dent Corcept’s profits and stock price.
  8. How pharma tries to block generics from coming to market: Generic companies need to compare their product with the branded product to get it approved. But the branded company can sometimes interfere with that. Corcept’s CEO implies in the article that Teva may have obtained Korlym for testing through nefarious means. Corcept’s CEO says Teva won’t have an impact on Korlym soon because the issued will be tied up in court for years.
  9. Conflict of interest: The original idea for Corcept was to develop mifepristone  for major depression. But a co-founder left the company in 2007 after Congress investigated his conflict of interest.
  10. Patient advocacy: Corcept is a funder of a patient advocacy group for Cushing’s. These groups can be useful for patients and their families as advocates for treatment and reimbursement and for raising awareness and educating people. Of course the drug manufacturers have an interest in how it goes.

Every one of these topics merits extensive discussion –or at least a blog post of its own. Thanks to Kaiser Health News for bringing all these issues to the surface.


By healthcare business consultant David E. Williams, president of Health Business Group.

How to solve America’s health care price problem? Maybe Medicaid

March 28th, 2018 by
Putting on the squeeze

The Affordable Care Act continues to be controversial, eight years after its passage, and a hostile Administration and Congressional majority have managed to undermine it, even if they haven’t been able to repeal it. Regardless, the ACA (aka Obamacare) has shifted the discussion on health insurance. Policy makers and the public increasingly assume that affordable coverage should be available to everyone and that pre-existing conditions should not be a factor in rate-setting or eligibility.

With uncertainty and dysfunction at the federal level, states are looking into using Medicaid “buy-in” as a way to achieve their policy goals. There are two main approaches being discussed: allowing individuals to enroll in traditional Medicaid by paying a premium or allowing individuals to buy Medicaid managed care policies on the marketplace.

A Health Affairs blog post provides a framework for evaluating these buy-in proposals. They outline six goals that policymakers may have in mind when instituting these programs:

  1. Improve coverage for the current individual market
  2. Provide options for people living in regions with limited choices of health plans
  3. Improve the viability of the private insurance marketplace
  4. Reduce premiums for consumers in the private insurance market
  5. Provide people with a guarantee of coverage with state-mandated consumer protections
  6. Improve the financial viability and contracting power of the Medicaid Agency

These are all worthy goals, but I would add another, systemic one. We read over and over again that the main reason healthcare spending is so much higher in the US than elsewhere is that prices are so much higher. Private health plans and Medicare haven’t done much to address this issue. Only Medicaid consistently pays low rates, so it seems that a way to bring down overall spending is to pay Medicaid rates, something that all of these buy-in approaches would achieve.

Providers won’t be happy with Medicaid rates and I don’t blame them. But a “Medicaid reset” would do the job of price reduction more than any other policy I can think of.

By healthcare business consultant David E. Williams, president of Health Business Group.

Health Wonk Review: Ideas of March Edition

March 15th, 2018 by

Beware the Ides of March” –Soothsayer to Julius Caesar
Fear not the Ideas of March” –Health Business Blog to the wonkosphere

If you see something say something

Your friendly neighborhood drug dealer

Count on Drug Channels to make sense of even the most convoluted pharmacy business models –and convoluted they are. This time the topic is the emerging trend of point-of-sale (POS) rebates. Did you know that many pharmacy benefit plans act like reverse insurance, with the sickest members subsidizing the healthiest? POS rebates start to right this wrong and bring forth uncomfortable questions such as: Where have the rebates been going until now?

Crocodile tears

Managed Care Matters shares its perspective that the Administration’s efforts to undermine the ACA have yielded bitter fruit on the marketplaces. Some premiums are up by 30% and meanwhile Congress is doing little or nothing.

Two years ago you couldn’t read the news without hearing about the disastrous premium increases due to “Obamacare,” but the media is silent now.

So what’s going on? Our blogger has a theory: The media is being manipulated and chasing bright, shiny objects.

Skimpy is as skimpy does

InsureBlog likes CMS’s proposal to restore the maximum policy length of short-term medical plans to 12 months from three. That’s even though some news outlets call the plans “skimpy” and some healthcare policy analysts consider such plans to be leeches on Obamacare, because they may siphon the healthiest people out of the marketplace risk pool and drive up premiums.

Location location location

When my son was a toddler, we trained him to say “location location location” when asked, ‘what are the three most important things about real estate?’ I still remember him driving a realtor crazy when one tried to pitch us on a house we didn’t like.

Now, Workers Comp Insider has decided that location is destiny in healthcare, too, declaring ‘It’s the Zip Code Stupid.’ Insider cites a recent JAMA Internal Medicine study that shows geography is “the biggest X-Factor in today’s American Hellzapoppin version of healthcare.”

Location: Wonk zone

The Hospital Leader (not to be confused with the Dear Leader) helpfully explains that “We need creative solutions” really means “the problem we are trying to solve has no answer.” Case study: Hospitals, hospice and SNFs – The big deceit.

A pending bill seeks to establish a state-based individual mandate in New Jersey. But a provision targeting employees of small businesses could inhibit Association Health Plans from selling insurance that does not comply with small group rules. Xpostfactoid explains.

Who knew? Health Care Renewal informs us that the ostensibly libertarian Washington Legal Foundation has become a front for healthcare corporate leaders –and leaders from other fields— to operate with impunity. The foundation’s campaign to abolish the Responsible Corporate Officer Doctrine failed, but the damage was done. (Hat tip to Health Care Renewal for anticipating today’s theme by including “methinks” in its cover note.)

Local talent

The Health Business Blog is now a teenager. I ran the annual round-up of favorite posts by month.

CareCentrix CEO John Driscoll and I rant and rave about Amazon and innovation in the latest monthly episode of #CareTalk.

Singing from the himmnal

Health System Ed shares results from the 2018 US HIMSS Leadership and Workforce Survey, a survey of providers and vendors.

Top themes: privacy and security, process improvement and workflow, data analytics, business intelligence to inform clinical decision-making remain top of mind. 

Well that’s it for the Ideas of March edition. Watch your back today!

By healthcare business consultant David E. Williams, president of Health Business Group.