Romney’s Approach to U.S. Health Reform
Mitt Romney has continuously received criticism on his position related to healthcare reform. Many believe the plan he instituted as governor of Massachusetts is similar to ObamaCare and others say his ideas on national health reform are more “revolutionary” than President Obama’s. Recently, Romney has released some of the main points of his plans should he be elected into office. These include block grants for Medicaid and other payments to states, the privatization of Medicare, and the promotion of free markets and competition within the health insurance industry.
An article in the LA Times discusses what some experts believe could result from these changes. Some argue that Romney’s plan would incentivize employers to stop providing coverage to their employees, resulting in an increase in the number of uninsured Americans. Conservative experts state the plan will bring benefits of competition to healthcare and would give consumers more power to choose their plans for themselves. Also, although Romney has said that President Obama’s legislation is a “budget-busting entitlement” as referred to in a Huffington Post article, some say his current ideas could similarly swell the federal deficit. Finally, some have stated Romney’s plan for national healthcare reform is contradictory to what he instituted in Massachusetts.
Regardless of whether you support RomneyCare or ObamaCare, it is clear that the healthcare industry will need to prepare for some serious adjustments resulting from governmental action. The continuing news about rising costs and questions over the sustainability of government programs like Medicare and Medicaid, and legislative reform is evidence of this. It is highly unlikely that anyone will devise a plan that pleases everyone when it comes to healthcare, but it will be interesting to see how this year’s election unfolds and what changes in regards to health reform will actually be instituted.
Author: Jamie Notaro
Editor: Ken Chiang
Medicare: Competitive Bidding
At the start of 2011, Medicare began a pilot system of competitive bidding for home health supplies in nine different regions throughout the country. Thus far, the program has received mixed reviews. A recent article in the New York Times touches on both sides of the story. Government officials plan to expand the system due to the $200 million in savings on medical equipment it has produced, despite the fact that many suppliers in the industry are against this action. Individuals who do not support competitive bidding claim that it has negative effects on smaller suppliers and on Medicare beneficiaries themselves.
The premise of the program sounds excellent: providing the same medical equipment to beneficiaries who need the supplies, and for less money without having to cut any other benefits. However, a separate article published on MarketWatch.com paints an entirely different picture. It claims the CMS has used the bidding process to reduce prices to unsustainable levels, which in turn, limits the number of available suppliers, causes winning bidders to lay-off employees in order to keep costs down, and diminishes the quality and accessibility of equipment being produced.
Before expanding the program, government officials must address these issues. If competitive bidding puts too much strain on the home health supply industry as a whole, or if it makes it harder for beneficiaries to get a hold of the products they need and results in lower quality equipment, it does not make sense to expand the program to other areas, no matter how great the savings may be. Perhaps the government is getting ahead of itself with this program and its potential for savings; a report released by the HHS estimates savings of up to $42.8 billion over 10 years1.
Although it may be a good idea to eliminate these kinks before expanding to other parts of the country, only time will tell how soon competitive bidding will reach new regions. Regardless of when further development may occur, suppliers of home healthcare equipment should certainly start preparing now if they hope to participate successfully within the competitive bidding program.
Written by: Jamie Notaro
Edited by: Ken Chiang
Current and Future Situation for Brand Name Drugs
As discussed in my previous post, healthcare costs and spending are a concern right now for many Americans, and will continue to be a prominent issue in the near future. Some propose that the use of brand name drugs, as opposed to generics, contribute to these high costs. An article on Medical Marketing & Media’s website discusses a projected downturn in branded drug spending by drug manufacturers throughout 2012 and 2013.
Although 34 new products were launched in 2011 by drug companies and spending on branded drugs grew 2.2%, the same kind of growth is not likely in upcoming years, and contractions in spending are even a possibility. The MM&M article states generic drugs now account for 80% of prescriptions. So why would a rational consumer not go with a generic option? Generic prescriptions have essentially the same active ingredients as brand name drugs, but can be a fraction of the cost.1
Well, consumers are sometimes concerned a generic drug may not produce the same effects as a brand name prescription. Among other factors, this definitely plays a role in loyalty to some branded drugs. However, many consumers have no other option because they simply cannot afford to pay a price premium.
Manufacturers of brand name drugs need to prepare for decreased sales, not only because of expiring patents and increased costs, but also because of the trend of consumers utilizing less health care. If patients do not visit their doctors as often, they cannot renew their prescriptions or receive new prescriptions from their physicians. Gaining new customers and holding on to current ones will be more challenging than ever to these companies in the near future, but they will need to find a way to do so.
Written by: Jamie Notaro
Edited by: Ken Chiang
1http://www.medicinenet.com/script/main/art.asp?articlekey=46204
U.S. Healthcare Costs: A Never-Ending Dilemma
It’s no secret that healthcare and its rising costs are a central focus for the United States these days. And it seems that every time it’s mentioned, there is a new idea or suggestion on how to solve the issue of continually growing costs. On April 4th 2012, an article was published in the New York Times about nine groups of medical specialty boards and their recommendation that doctors perform 45 relatively common tests and procedures less often. The article also states that patients should question these particular services when they are offered.
The reasoning behind using these “routine” procedures less often is that they unnecessarily increase healthcare costs with little benefit to patients. However, making such a claim brings forth so many questions and concerns it is almost mind boggling. Examples include debates over the motivation of doctors for ordering such frequent tests when they may be unnecessary, and whether patients feel that they are being robbed of thorough care without certain procedures and tests. There is an educational initiative also mentioned called “Choosing Wisely” promoted by the American Board of Internal Medicine Foundation which could help in altering the behavior of both doctors and patients. Should these recommendations be taken into effect, the current utilization of certain medical devices and drugs could change. Whether action would have positive or negative implications for pharmaceutical and medical device companies is hard to say, but it is certainly something to which those companies should pay close attention.
According to a report from the Kaiser Family Foundation1 some of the main drivers of health care spending are technology and prescription drugs. To add to that, they mention that 31% of health expenditures in 2010 resulted from hospital care and an additional 20% came from physician and clinical services. This proves that the types recommendations made may hold some merit, at least in the fact that they are a significant factor in additional spending. There is a careful balance that physicians face when making decisions on how to treat their patients that I cannot even imagine. Clearly, to run tests and procedures and rack up a hefty bill with little to show for is not the goal, but to decide against the same tests and procedures and potentially lower the quality of care is not desirable either. It seems like common sense to me that patients’ situations must be taken on a case-by-case basis, and all-or-nothing rules should not apply to healthcare. Although that is not to say that there could be some doctors that should put a little bit more thought into what their patients really need, and what they could do without.
Author: Jamie Notaro
Editor: Ken Chiang
1 http://www.kaiseredu.org/Issue-Modules/US-Health-Care-Costs/Background-Brief.aspx
Medspan Hires Joe Robinson as Director of Sales and Marketing
CHICAGO, March 21, 2012 /PRNewswire-iReach/ — MedSpan is pleased to announce its recent hire of Joe Robinson, who will join the company as Director of Sales and Marketing, working from the home office in South Barrington, IL. Mr. Robinson will take a leadership role at MedSpan in a dual capacity, managing both business development and internal marketing strategy.
“I was attracted to the opportunity due to MedSpan’s focus on managed care research and the high level of expertise of our staff. The growing influence of payers over prescribing choices and new healthcare reform initiatives require brands to develop a well-designed marketing strategy to gain access and support prescribers” Robinson said. “MedSpan is best positioned to deliver high quality market research and consulting services. The access that we have to key decision makers in managed care plus our strategic focus in the areas of enhancing coverage, reimbursement and access make us a valued partner to our clients”.
Mr. Robinson comes to MedSpan with fifteen years of experience in the healthcare industry. Most recently, Mr. Robinson worked in Business Development with Epocrates and QuantiaMD, two companies which provide mobile decision support tools for clinicians. At both companies, he was responsible for partnering with pharmaceutical brand teams to develop and implement digital marketing strategies targeting physicians, nurses, pharmacists and other allied healthcare professionals. This background has helped Mr. Robinson to make an easy transition into his current position with MedSpan.
Robert Kaminsky, founder and President of MedSpan, said, “Joe is a tremendous addition to our team. He will prove to be a valuable asset for our clients by providing access to the breadth of experience and expertise MedSpan offers.”
Previously, Mr. Robinson worked for Pfizer and Novartis in various sales and marketing roles. With experience as a pharma client and vendor coupled with a working knowledge of brand strategy, Mr. Robinson brings a unique perspective to clients while helping develop market research programs that guide strategic initiatives.
Mr. Robinson is a Philadelphia native with a B.A. in Economics and Philosophy from Temple University and an M.B.A. from The Babcock Graduate School of Management at Wake Forest University. Follow him on Twitter at @jrobinsonpharma and @medspanresearch.
For more information, please contact Pam Kaminsky at 847-713-8083, pkaminsky@medspanresearch.com or visit the MedSpan website at www.medspanresearch.com.
MedSpan is a healthcare market research company that provides qualitative and quantitative research for healthcare manufacturers and distributors. MedSpan offers clients the knowledge, experience and cutting-edge methodologies to address the marketing challenges many healthcare stakeholders face in today’s complex and changing healthcare markets.
With MedSpan as their market research partner, pharmaceutical, medical device and diagnostic imaging companies launch products with increased assurance that they will be adopted by physicians and other providers, valued by patients and caregivers, and reimbursed by payers. MedSpan’s client roster includes Walgreens, Baxter, Sagent Pharmaceuticals, Endo Health Solutions, Novo Nordisk, McKesson and many more.
Media Contact: Joseph Robinson of MedSpan, 8477138087, jrobinson@medspanresearch.com
News distributed by PR Newswire iReach: https://ireach.prnewswire.com
SOURCE MedSpan
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EMR vs. EHR
Do you know the difference between an “electronic medical record” (EMR) and an “electronic health record” (EHR)? There is a common misconception that these terms are interchangeable, and many people today could not tell you if there is a difference between the two terms, let alone what that difference is.
An EMR is essentially the equivalent of a paper chart for a patient that is filled out by providers within an individual healthcare delivery organization (e.g. hospitals, physician’s offices), and is a legal record owned by that organization. EMR computer software is sold by enterprise vendors to hospitals, clinics, and other care delivery sites.
An EHR is a subset of EMRs that contains patient information from different healthcare delivery organizations. These records are owned by the patient or stakeholder, and the information can be shared through an EHR network. Unlike EMRs, electronic health records are interactive and the patient can access and supplement the information contained in the file. EHRs connect different healthcare organizations and may contain more detailed information about a patient’s demographics, medications, medical history, etc.
So, in order to utilize EHRs and for them to be effective, EMR software must be adopted by healthcare delivery organizations. Based on an HIMSS Analytics report published in 2006, the majority of hospitals have begun to implement EMRs, but at that point were not beyond the earliest stages. Since then both EMR systems and EHRs have grown in utilization and popularity, considering the potential for the easy sharing of patient information between healthcare organizations. A 2011 presentation by HIMSS shows that in 2011 more hospitals are developing their ability to use EHRs.
Both EMRs and EHRs are clearly an area of high potential for the healthcare industry. As the systems are more widely adopted and developed further at various organizations, the added ease of access and quality of health information will ideally help care provider organizations provide better treatment for patients. There are potential worries related to privacy and security with this type of information being transmitted electronically, however that is an entirely different issue that I will leave to be discussed at another time.
Author: Jamie Notaro
Edited by: Ken Chiang
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Self Powered Pacemaker
The advances in medical device technology over the past several decades have been exponential, much like technological advances in other fields. These medical devices have helped people live longer, more independent, and better fulfilled lives. A popular example of such a device is a cardiac pacemaker, where future improvements continue to develop. Recently, researchers at the University of Michigan have designed a device where pacemakers will be powered by heartbeat vibrations, eliminating the need for a battery. An article on MedicalNewsToday.com describes more details of the design and how the device works.
The advantage of self-powered pacemakers for patients and for the healthcare system overall is the elimination of follow-up surgery currently required to replace batteries every 5-10 years. Patients need not go through invasive procedures in order to maintain their standard of living. This would also lower the cost for patients with cardiac problems that result in the need for a pacemaker. Should the pacemaker powered by heartbeats end up costing more to produce than current battery-powered models, the overall costs in the long run without additional surgeries would certainly still make for a more economical device.
If the pacemaker being developed at the University of Michigan is successful, the potential for this technology to be applied to other medical devices is high. An article on dailyRX.com states the power source could be applied to implantable cardioverter defibrillators as well for patients who are at risk for sudden cardiac death. Who knows what other devices that now rely on battery power could eventually be powered by the human body’s endogenous vibrations? It is inspiring to see such innovation still occurring within the healthcare arena, and hopefully the advances will continue to help increase cost effectiveness and improve the benefits to patients.
Author: Jamie Notaro
Editor: Ken Chiang
FDA Oversight Abroad
Like many products consumed in the United States, many drugs are developed and manufactured outside of our country’s borders. A New York Times article from August of last year reports that more than 80% of active ingredients for drugs sold here are made elsewhere1. In a recent House hearing, FDA Commissioner Dr. Margaret Hamburg stated that the FDA needs more resources in order to properly oversee the development and manufacturing of these types of products abroad. Modern Healthcare published an article describing these concerns the FDA has in regards to oversight of foreign-made drugs. Other issues such as drug shortages and pedigree are also mentioned.
FDA Deputy Commissioner for Global Regulatory Operations and Policy Deborah Autor is also mentioned in the article and states that action from Congress may be required to implement a national pedigree for drugs, which would track products from the manufacturer to the final buyer to ensure the integrity of the supply chain. Many states already have pedigree laws in effect, so the interaction of a federal clause and existing state statutes is something to be considered. This type of action from the Food and Drug Administration and Congress could also have great effects on those companies that do produce drugs overseas. It may or may not cause them to need to make some changes to their supply chains, which could in turn raise the cost to produce a given drug.
These problems discussed in the article and at the hearing bring up an interesting dilemma. It seems a fairly universally agreed upon concept that the FDA should have the capacity to oversee the manufacturing of the drugs that are sold here in the United States, regardless of where they are made. However, would actions to give the FDA the resources it needs to increase supervision abroad make it more difficult for drug companies to produce their products at the same rate and for the same price? Which is more important: allocating resources to ensure drugs are being produced at the proper quality, or making sure there is enough of a given drug to provide for the need that is present? Drug shortages have been an ongoing issue of late, which could continue to worsen if certain drug manufacturing supply chains are interfered with.
The safety of both prescription and non-prescription drugs is key, that is unquestionable. But will the FDA really ever be able to keep track of the quality of every drug produced outside of the United States? Before taking any action, both the FDA and Congress should consider the potential benefits of higher levels of oversight versus what complications may arise from it.
Written by: Jamie Notaro
Edited by: Ken Chiang
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1 http://www.nytimes.com/2011/08/13/science/13drug.html?pagewanted=all
Pharmaceutical Advertising
As consumers, we are by no means strangers to pharmaceutical advertisements. They are constantly in front of us, whether it is via TV commercials, magazine ads, or billboards along the highway. An article published on the New York Times (nytimes.com) website takes a look at how these direct to consumer advertisements have impacted Americans’ use of prescription drugs. It also discusses how doctors and patients now use checklists that can be found often times online to diagnose ailments and indicate the proper treatment.
The goal of pharmaceutical companies in regards to advertisements to consumers is clear; they want to raise awareness of their branded drug and want consumers to choose their prescription medication to take over others. It has been difficult to prove, however, that advertisements lead to any increase in direct sales as mentioned in the article. Are patients really any more likely to take a particular drug simply because they know of the brand, or do they simply listen to what their healthcare providers tell them to do? And is the information provided in these ads helping the consumer become more well-informed and knowledgeable with respect to what drugs they should be taking?
Many people, me included, seem to find drug advertisements to be a bit of a nuisance. Although I may be wrong, when the time comes for me to begin taking various prescription medications, I think I will let my doctor make the diagnosis and prescribe me whatever drug he or she thinks will work best—regardless of whether I’ve seen a commercial for it or not. Obviously this is not the case with every consumer; there are some that question their doctors on certain brand name drugs. My question is: is it really worth the time and money of pharmaceutical companies to heavily advertise their drugs to consumers? If there is no way to prove that they help sales and many consumers are annoyed by the ads, is the main reason to continue this heavy advertising to consumers simply to keep up with others in the industry?
I assume pharmaceutical companies could save a significant amount of money if they cut back on their advertising, and with little research to support that advertisements help sales, doing so may not have a negative impact. I know I would not be upset with the absence of prescription drug ads in my day to day life and I am sure I am not alone.
Author: Jamie Notaro
Edited by: Ken Chiang
Medicare-Democratic Side
As discussed in last week’s blog entry, Medicare is a central issue right now for our country. I went into more detail in that previous post about many Republicans’ desires to increase the privatization of payment for Medicare services, but what do the Democrats want? After Representative Paul Ryan’s (R-Wis.) proposal was released, President Obama shared with the nation what his agenda for Medicare included. Many members of the Democratic Party believe Ryan’s subsidy plan would be a colossal error. Obama, also not wanting to move to a Medicare voucher system, said in a speech given in April of 20111 that his plan for Medicare would protect the fundamental commitment our country has to the elderly, disabled, and poor, which he and other Democrats feel Ryan’s plan fails to do. The President has outlined several ways in which he will create savings within the Medicare program.
Obama plans to make certain changes that directly affect Medicare beneficiaries. For example, increasing deductibles by $25 in 2017, 2019, and 2021, increasing premiums for higher-income beneficiaries, and increasing the percentage of beneficiaries paying higher premiums from 5%-25%. He also calls for new beneficiaries to pay co-payments of $100 for home healthcare visits starting in 20172. Finally, new beneficiaries who buy private insurance to help fill gaps in Medicare would see an increase in Medicare premiums by 30%. These are all actions to increase the revenue received by Medicare through its beneficiaries. Another target source of revenue in Obama’s proposal is pharmaceutical companies. There would be a requirement for drug companies to lower their rates and pay out additional rebates to low-income beneficiaries. Those producing brand name drugs would pay a rebate of 23% and generic drug makers would pay a 13% rebate3.
These actions to increase revenues could affect the decisions made by both Medicare beneficiaries and many pharmaceutical companies. Those about to enroll in Medicare may choose to take advantage of the program much differently than before changes were made. Also, the drug companies might change what proportions of what drugs they produce depending on how the rebates affect them.
Cutting expenses is another way President Obama plans to reform Medicare. Slowly lowering Medicare payments to nursing homes, home health agencies, and rehabilitation hospitals, cutting payments from nursing homes where large numbers of patients were hospitalized because they did not receive proper care at the home, and reducing payments to hospitals and other providers for bad debts that result when beneficiaries fail to pay deductibles and co-payments are all ways to save money for Medicare4. Implementing these changes will not only save Medicare money, but it will help to change the incentive system and encourage providers to execute higher quality care.
I believe Obama’s plan has positive underlying ideas. Changing the incentive system to provide higher quality products and services for those enrolled in Medicare is a difficult task to accomplish. Making healthcare more accessible and affordable is also a key to the President’s suggested changes. Whether the Democratic Party and President Obama are given the chance to implement their changes, or Paul Ryan and the Republicans are given the opportunity, all who are somehow active in the healthcare system should be ready to make some adjustments of their own.
Author: Jamie Notaro
Edited by: Ken Chiang
1Remarks by the President on Fiscal Policy: http://www.whitehouse.gov/the-press-office/2011/04/13/remarks-president-fiscal-policy
2,4New York Times: http://www.nytimes.com/2011/09/20/us/politics/medicare-and-medicaid-face-320-billion-in-cuts-over-10-years.html?_r=1&emc=tnt&tntemail0=y
3Kaiser Health News: http://www.kaiserhealthnews.org/Stories/2011/September/19/Obama-Plan-To-Cut-Health-Programs-By-320-Billion.aspx
Robert Kaminsky
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