Alicia Ault

GAITHERSBURG, MD. — The 2007–2008 trivalent influenza vaccine should retain two strains from the current vaccine and change one strain, a Food and Drug Administration advisory panel has concluded.

The Vaccines and Related Biological Products Advisory Committee followed the lead of the World Health Organization, which made its recommendations for a Northern Hemisphere winter vaccine a week earlier.

In most cases, the FDA follows its panel's advice.

The decision gives the green light to manufacturers to go ahead with production. It generally takes until July or August for vaccine makers to complete testing, acquire FDA approval, and begin packaging their product.

Distribution usually starts in September and ends by Nov. 1.

Based on surveillance reports, the availability of seed stock to grow viruses, and reagents to test potency, vaccine makers already had begun production of most of the strains that ultimately were selected, said Albert Thomas, a Sanofi Pasteur representative who spoke at the FDA meeting. The manufacturers take the early production risk in order to speed up the process, he explained.

If the FDA committee had chosen different strains, vaccine makers likely would have had to reduce their ultimate production by 20%, Mr. Thomas said.

That potential production loss pushed the committee to vote against changing one component, the influenza A (H3N2) strain, even though the most recent surveillance data suggest that a different H3 strain currently is emerging.

The WHO recommended keeping the current H3N2 strain, which is the A/Wisconsin/67/2005-like virus. The 2006–2007 flu season had been dominated mostly by influenza A (H1N1) strains, said Nancy J. Cox, Ph.D., director of the Centers for Disease Control and Prevention's influenza division. But in February, it appeared that H3N2 strains were starting to dominate. It wasn't clear yet which of those might be the predominant H3 strain, Ms. Cox said.

Even though panelists were concerned about the emergence of a new H3N2 subtype, 11 of 13 members voted to keep the current H3 strain. “At this point, I feel like we don't have any choice,” said Dr. Melinda Wharton, deputy director of the CDC's National Immunization Program and a temporary voting member of the committee. She noted that manufacturers already had started production on the current H3 strain.

Two committee members said they wanted to defer a decision until more surveillance data were available.

The panel voted unanimously to change the current H1N1 strain from A/New Caledonia/20/99-like virus with A/Solomon Islands/3/2006. The WHO had recommended that change.

The FDA committee also voted unanimously to retain the current B strain—B/Malaysia/2506/2004-like virus—mirroring the WHO recommendation.

The 2006–2007 season has been fairly mild, Ms. Cox said. As of Feb. 17, widespread flu activity was reported in 24 states, 14 states reported regional activity, 10 reported local activity, and 2 reported sporadic activity.

For adults, the death rate from pneumonia and influenza—at 6.9%–-was below the epidemic threshold of 7.9%. There were 3 pediatric deaths during that week, bringing the total to 15 deaths since the season began Oct. 1, 2006.

GAITHERSBURG, MD. — The 2007–2008 trivalent influenza vaccine should retain two strains from the current vaccine and change one strain, a Food and Drug Administration advisory panel has concluded.

The Vaccines and Related Biological Products Advisory Committee followed the lead of the World Health Organization, which made its recommendations for a Northern Hemisphere winter vaccine a week earlier.

In most cases, the FDA follows its panel's advice.

The decision gives the green light to manufacturers to go ahead with production. It generally takes until July or August for vaccine makers to complete testing, acquire FDA approval, and begin packaging their product.

Distribution usually starts in September and ends by Nov. 1.

Based on surveillance reports, the availability of seed stock to grow viruses, and reagents to test potency, vaccine makers already had begun production of most of the strains that ultimately were selected, said Albert Thomas, a Sanofi Pasteur representative who spoke at the FDA meeting. The manufacturers take the early production risk in order to speed up the process, he explained.

If the FDA committee had chosen different strains, vaccine makers likely would have had to reduce their ultimate production by 20%, Mr. Thomas said.

That potential production loss pushed the committee to vote against changing one component, the influenza A (H3N2) strain, even though the most recent surveillance data suggest that a different H3 strain currently is emerging.

The WHO recommended keeping the current H3N2 strain, which is the A/Wisconsin/67/2005-like virus. The 2006–2007 flu season had been dominated mostly by influenza A (H1N1) strains, said Nancy J. Cox, Ph.D., director of the Centers for Disease Control and Prevention's influenza division. But in February, it appeared that H3N2 strains were starting to dominate. It wasn't clear yet which of those might be the predominant H3 strain, Ms. Cox said.

Even though panelists were concerned about the emergence of a new H3N2 subtype, 11 of 13 members voted to keep the current H3 strain. “At this point, I feel like we don't have any choice,” said Dr. Melinda Wharton, deputy director of the CDC's National Immunization Program and a temporary voting member of the committee. She noted that manufacturers already had started production on the current H3 strain.

Two committee members said they wanted to defer a decision until more surveillance data were available.

The panel voted unanimously to change the current H1N1 strain from A/New Caledonia/20/99-like virus with A/Solomon Islands/3/2006. The WHO had recommended that change.

The FDA committee also voted unanimously to retain the current B strain—B/Malaysia/2506/2004-like virus—mirroring the WHO recommendation.

The 2006–2007 season has been fairly mild, Ms. Cox said. As of Feb. 17, widespread flu activity was reported in 24 states, 14 states reported regional activity, 10 reported local activity, and 2 reported sporadic activity.

For adults, the death rate from pneumonia and influenza—at 6.9%–-was below the epidemic threshold of 7.9%. There were 3 pediatric deaths during that week, bringing the total to 15 deaths since the season began Oct. 1, 2006.

GAITHERSBURG, MD. — The 2007–2008 trivalent influenza vaccine should retain two strains from the current vaccine and change one strain, a Food and Drug Administration advisory panel has concluded.

The Vaccines and Related Biological Products Advisory Committee followed the lead of the World Health Organization, which made its recommendations for a Northern Hemisphere winter vaccine a week earlier.

In most cases, the FDA follows its panel's advice.

The decision gives the green light to manufacturers to go ahead with production. It generally takes until July or August for vaccine makers to complete testing, acquire FDA approval, and begin packaging their product.

Distribution usually starts in September and ends by Nov. 1.

Based on surveillance reports, the availability of seed stock to grow viruses, and reagents to test potency, vaccine makers already had begun production of most of the strains that ultimately were selected, said Albert Thomas, a Sanofi Pasteur representative who spoke at the FDA meeting. The manufacturers take the early production risk in order to speed up the process, he explained.

If the FDA committee had chosen different strains, vaccine makers likely would have had to reduce their ultimate production by 20%, Mr. Thomas said.

That potential production loss pushed the committee to vote against changing one component, the influenza A (H3N2) strain, even though the most recent surveillance data suggest that a different H3 strain currently is emerging.

The WHO recommended keeping the current H3N2 strain, which is the A/Wisconsin/67/2005-like virus. The 2006–2007 flu season had been dominated mostly by influenza A (H1N1) strains, said Nancy J. Cox, Ph.D., director of the Centers for Disease Control and Prevention's influenza division. But in February, it appeared that H3N2 strains were starting to dominate. It wasn't clear yet which of those might be the predominant H3 strain, Ms. Cox said.

Even though panelists were concerned about the emergence of a new H3N2 subtype, 11 of 13 members voted to keep the current H3 strain. “At this point, I feel like we don't have any choice,” said Dr. Melinda Wharton, deputy director of the CDC's National Immunization Program and a temporary voting member of the committee. She noted that manufacturers already had started production on the current H3 strain.

Two committee members said they wanted to defer a decision until more surveillance data were available.

The panel voted unanimously to change the current H1N1 strain from A/New Caledonia/20/99-like virus with A/Solomon Islands/3/2006. The WHO had recommended that change.

The FDA committee also voted unanimously to retain the current B strain—B/Malaysia/2506/2004-like virus—mirroring the WHO recommendation.

The 2006–2007 season has been fairly mild, Ms. Cox said. As of Feb. 17, widespread flu activity was reported in 24 states, 14 states reported regional activity, 10 reported local activity, and 2 reported sporadic activity.

For adults, the death rate from pneumonia and influenza—at 6.9%–-was below the epidemic threshold of 7.9%. There were 3 pediatric deaths during that week, bringing the total to 15 deaths since the season began Oct. 1, 2006.

WASHINGTON — Client billing may cost patients less than other forms of billing for pathology services, Manika Kumar and her associates said in a poster presentation at the annual meeting of the American Academy of Dermatology.

There is much debate about whether dermatologists should be allowed to bill patients directly for interpretations of skin biopsies done by pathologists. Nine states are considering laws to require direct billing from the physician who interprets the biopsy, while four states expressly prohibit any markup on pathology interpretations, according to Ms. Kumar and her associates of Wake Forest University, Winston-Salem, N.C.

The researchers surveyed North Carolina-based dermatology and pathology practices on skin biopsy practices and about billing for interpretation of those biopsies.

The researchers called 229 private dermatology practices, asking what they charged for interpreting biopsies, and whether those biopsies were interpreted in-office or sent out to pathologists.

The researchers also called 213 pathologists' offices to ask if they interpreted specimens from dermatology practices, and if so, how much they charged.

Of the 229 dermatologists, only 105 reported charges. Half of those 105 dermatologists could not give the exact charge because specimens were sent to pathologists who directly billed the patients. Of responding dermatologists, 9% interpreted skin biopsies in their office and directly billed the patient. Twenty-two percent sent the specimen to a pathologist but billed the patient for the interpretation—a practice known as client billing.

Client billing resulted in the lowest charge—a mean of $120. Patients who received a bill for interpretation by dermatologists on-site were charged an average $131. The most expensive charges were from pathologists who billed directly—a mean of $147, Ms. Kumar and her associates reported.

When pathologists were asked to report charges, only 48 of the 213 offices responded. The average reported charge was $150.

A Turkey-Kramer statistical test determined that the difference between client billing by dermatologists and direct patient billing by pathologists was significant. There was no significant difference between direct patient billing by dermatologists or pathologists, the investigators wrote.

Client billing is probably less expensive because dermatologists have lower billing costs and less risk of unpaid bills. Based on this small study, it is possible that Medicare and Medicaid payouts for pathology services could be reduced if the federal laws were changed to allow client billing for skin biopsies under those programs, Ms. Kumar and her associates suggested.

WASHINGTON — Client billing may cost patients less than other forms of billing for pathology services, Manika Kumar and her associates said in a poster presentation at the annual meeting of the American Academy of Dermatology.

There is much debate about whether dermatologists should be allowed to bill patients directly for interpretations of skin biopsies done by pathologists. Nine states are considering laws to require direct billing from the physician who interprets the biopsy, while four states expressly prohibit any markup on pathology interpretations, according to Ms. Kumar and her associates of Wake Forest University, Winston-Salem, N.C.

The researchers surveyed North Carolina-based dermatology and pathology practices on skin biopsy practices and about billing for interpretation of those biopsies.

The researchers called 229 private dermatology practices, asking what they charged for interpreting biopsies, and whether those biopsies were interpreted in-office or sent out to pathologists.

The researchers also called 213 pathologists' offices to ask if they interpreted specimens from dermatology practices, and if so, how much they charged.

Of the 229 dermatologists, only 105 reported charges. Half of those 105 dermatologists could not give the exact charge because specimens were sent to pathologists who directly billed the patients. Of responding dermatologists, 9% interpreted skin biopsies in their office and directly billed the patient. Twenty-two percent sent the specimen to a pathologist but billed the patient for the interpretation—a practice known as client billing.

Client billing resulted in the lowest charge—a mean of $120. Patients who received a bill for interpretation by dermatologists on-site were charged an average $131. The most expensive charges were from pathologists who billed directly—a mean of $147, Ms. Kumar and her associates reported.

When pathologists were asked to report charges, only 48 of the 213 offices responded. The average reported charge was $150.

A Turkey-Kramer statistical test determined that the difference between client billing by dermatologists and direct patient billing by pathologists was significant. There was no significant difference between direct patient billing by dermatologists or pathologists, the investigators wrote.

Client billing is probably less expensive because dermatologists have lower billing costs and less risk of unpaid bills. Based on this small study, it is possible that Medicare and Medicaid payouts for pathology services could be reduced if the federal laws were changed to allow client billing for skin biopsies under those programs, Ms. Kumar and her associates suggested.

WASHINGTON — Client billing may cost patients less than other forms of billing for pathology services, Manika Kumar and her associates said in a poster presentation at the annual meeting of the American Academy of Dermatology.

There is much debate about whether dermatologists should be allowed to bill patients directly for interpretations of skin biopsies done by pathologists. Nine states are considering laws to require direct billing from the physician who interprets the biopsy, while four states expressly prohibit any markup on pathology interpretations, according to Ms. Kumar and her associates of Wake Forest University, Winston-Salem, N.C.

The researchers surveyed North Carolina-based dermatology and pathology practices on skin biopsy practices and about billing for interpretation of those biopsies.

The researchers called 229 private dermatology practices, asking what they charged for interpreting biopsies, and whether those biopsies were interpreted in-office or sent out to pathologists.

The researchers also called 213 pathologists' offices to ask if they interpreted specimens from dermatology practices, and if so, how much they charged.

Of the 229 dermatologists, only 105 reported charges. Half of those 105 dermatologists could not give the exact charge because specimens were sent to pathologists who directly billed the patients. Of responding dermatologists, 9% interpreted skin biopsies in their office and directly billed the patient. Twenty-two percent sent the specimen to a pathologist but billed the patient for the interpretation—a practice known as client billing.

Client billing resulted in the lowest charge—a mean of $120. Patients who received a bill for interpretation by dermatologists on-site were charged an average $131. The most expensive charges were from pathologists who billed directly—a mean of $147, Ms. Kumar and her associates reported.

When pathologists were asked to report charges, only 48 of the 213 offices responded. The average reported charge was $150.

A Turkey-Kramer statistical test determined that the difference between client billing by dermatologists and direct patient billing by pathologists was significant. There was no significant difference between direct patient billing by dermatologists or pathologists, the investigators wrote.

Client billing is probably less expensive because dermatologists have lower billing costs and less risk of unpaid bills. Based on this small study, it is possible that Medicare and Medicaid payouts for pathology services could be reduced if the federal laws were changed to allow client billing for skin biopsies under those programs, Ms. Kumar and her associates suggested.

WASHINGTON — Special consideration should be taken when conducting cosmetic dermatologic procedures—especially with lasers—on skin of color, because the malpractice risk is higher, Dr. David J. Goldberg said at the annual meeting of the American Academy of Dermatology.

Dr. Goldberg, director of laser research and Mohs surgery at Mount Sinai School of Medicine, New York, and adjunct professor at Fordham University School of Law, New York, said that thinking like a first-year law student and being aware of the inherent risks associated with using lasers in darker skin can minimize risk.

Lawsuits are brought for a variety of reasons, primarily because of negligence, but also because physicians are poor communicators or because patients may be seeking retribution for unsatisfactory results or just trying to get some money, said Dr. Goldberg.

For a lawsuit to be successful, though, it must be proved that a physician breached his or her duty, that the breach caused the problem, and that it is serious enough to warrant damages. These basic tort components are drilled into first-year students, he said.

With laser and intense pulsed light (IPL) procedures, ethnic skin is more susceptible to damage because melanocytes in the skin compete with the technologies, Dr. Goldberg said.

Often, insufficient protection against cold is employed when surgeons treat patients with darker skin types.

Side effects that could lead to claims include erythema, hypo- or hyperpigmentation, infections, and scarring. Warning patients with darker skin about these potential complications is essential. White patients may experience pigmentation issues, but the changes are generally not permanent and will not likely lead to a lawsuit, said Dr. Goldberg.

Those changes can be long-lasting or even permanent in skin of color. "If it's permanent, it will be a successful lawsuit," Dr. Goldberg said. He noted one of his cases from a decade ago, in which he had used an IPL device to remove tattoos on a young man's skull. IPL devices were approved for that indication, but he said "they clearly don't work at all." He induced hypopigmentation, which was fairly long-lasting. The patient did not file a claim, but "today it would lead to a lawsuit."

Complications don't automatically lead to a claim or to a successful lawsuit. If a physician performed a procedure correctly, and there was no breach of duty but there was a complication, there would be no negligence, he said.

If there is a cold-induced injury and the patient hasn't been warned, or was warned but the physician did something wrong, and the damage is permanent, there will be a lawsuit, Dr. Goldberg said.

Getting patient consent is crucial, but if a patient says he or she does not remember the warnings in the consent, a lawsuit could proceed.

Some suits might not ever come to fruition because of the slow pace of the U.S. legal system.

"Sometimes, by the time you get in front of the jury, the jury looks and says there is not much here any more," he said, and noted that what had appeared permanent might have faded by trial time.

To reduce the risk of getting to that stage, physicians should handle disgruntled patients head on. "Keep them happy, talk to them, and think like a first-year law student. That's going to solve 99% of your problems," he said.

WASHINGTON — Special consideration should be taken when conducting cosmetic dermatologic procedures—especially with lasers—on skin of color, because the malpractice risk is higher, Dr. David J. Goldberg said at the annual meeting of the American Academy of Dermatology.

Dr. Goldberg, director of laser research and Mohs surgery at Mount Sinai School of Medicine, New York, and adjunct professor at Fordham University School of Law, New York, said that thinking like a first-year law student and being aware of the inherent risks associated with using lasers in darker skin can minimize risk.

Lawsuits are brought for a variety of reasons, primarily because of negligence, but also because physicians are poor communicators or because patients may be seeking retribution for unsatisfactory results or just trying to get some money, said Dr. Goldberg.

For a lawsuit to be successful, though, it must be proved that a physician breached his or her duty, that the breach caused the problem, and that it is serious enough to warrant damages. These basic tort components are drilled into first-year students, he said.

With laser and intense pulsed light (IPL) procedures, ethnic skin is more susceptible to damage because melanocytes in the skin compete with the technologies, Dr. Goldberg said.

Often, insufficient protection against cold is employed when surgeons treat patients with darker skin types.

Side effects that could lead to claims include erythema, hypo- or hyperpigmentation, infections, and scarring. Warning patients with darker skin about these potential complications is essential. White patients may experience pigmentation issues, but the changes are generally not permanent and will not likely lead to a lawsuit, said Dr. Goldberg.

Those changes can be long-lasting or even permanent in skin of color. "If it's permanent, it will be a successful lawsuit," Dr. Goldberg said. He noted one of his cases from a decade ago, in which he had used an IPL device to remove tattoos on a young man's skull. IPL devices were approved for that indication, but he said "they clearly don't work at all." He induced hypopigmentation, which was fairly long-lasting. The patient did not file a claim, but "today it would lead to a lawsuit."

Complications don't automatically lead to a claim or to a successful lawsuit. If a physician performed a procedure correctly, and there was no breach of duty but there was a complication, there would be no negligence, he said.

If there is a cold-induced injury and the patient hasn't been warned, or was warned but the physician did something wrong, and the damage is permanent, there will be a lawsuit, Dr. Goldberg said.

Getting patient consent is crucial, but if a patient says he or she does not remember the warnings in the consent, a lawsuit could proceed.

Some suits might not ever come to fruition because of the slow pace of the U.S. legal system.

"Sometimes, by the time you get in front of the jury, the jury looks and says there is not much here any more," he said, and noted that what had appeared permanent might have faded by trial time.

To reduce the risk of getting to that stage, physicians should handle disgruntled patients head on. "Keep them happy, talk to them, and think like a first-year law student. That's going to solve 99% of your problems," he said.

WASHINGTON — Special consideration should be taken when conducting cosmetic dermatologic procedures—especially with lasers—on skin of color, because the malpractice risk is higher, Dr. David J. Goldberg said at the annual meeting of the American Academy of Dermatology.

Dr. Goldberg, director of laser research and Mohs surgery at Mount Sinai School of Medicine, New York, and adjunct professor at Fordham University School of Law, New York, said that thinking like a first-year law student and being aware of the inherent risks associated with using lasers in darker skin can minimize risk.

Lawsuits are brought for a variety of reasons, primarily because of negligence, but also because physicians are poor communicators or because patients may be seeking retribution for unsatisfactory results or just trying to get some money, said Dr. Goldberg.

For a lawsuit to be successful, though, it must be proved that a physician breached his or her duty, that the breach caused the problem, and that it is serious enough to warrant damages. These basic tort components are drilled into first-year students, he said.

With laser and intense pulsed light (IPL) procedures, ethnic skin is more susceptible to damage because melanocytes in the skin compete with the technologies, Dr. Goldberg said.

Often, insufficient protection against cold is employed when surgeons treat patients with darker skin types.

Side effects that could lead to claims include erythema, hypo- or hyperpigmentation, infections, and scarring. Warning patients with darker skin about these potential complications is essential. White patients may experience pigmentation issues, but the changes are generally not permanent and will not likely lead to a lawsuit, said Dr. Goldberg.

Those changes can be long-lasting or even permanent in skin of color. "If it's permanent, it will be a successful lawsuit," Dr. Goldberg said. He noted one of his cases from a decade ago, in which he had used an IPL device to remove tattoos on a young man's skull. IPL devices were approved for that indication, but he said "they clearly don't work at all." He induced hypopigmentation, which was fairly long-lasting. The patient did not file a claim, but "today it would lead to a lawsuit."

Complications don't automatically lead to a claim or to a successful lawsuit. If a physician performed a procedure correctly, and there was no breach of duty but there was a complication, there would be no negligence, he said.

If there is a cold-induced injury and the patient hasn't been warned, or was warned but the physician did something wrong, and the damage is permanent, there will be a lawsuit, Dr. Goldberg said.

Getting patient consent is crucial, but if a patient says he or she does not remember the warnings in the consent, a lawsuit could proceed.

Some suits might not ever come to fruition because of the slow pace of the U.S. legal system.

"Sometimes, by the time you get in front of the jury, the jury looks and says there is not much here any more," he said, and noted that what had appeared permanent might have faded by trial time.

To reduce the risk of getting to that stage, physicians should handle disgruntled patients head on. "Keep them happy, talk to them, and think like a first-year law student. That's going to solve 99% of your problems," he said.

Surge in Nonsurgical Procedures

The latest data from the American Society for Aesthetic Plastic Surgery (ASAPS) show that the number of nonsurgical cosmetic procedures increased 747% in the last decade, far outstripping the 98% growth in surgical cosmetic procedures. In 2006, there was a 4% increase in nonsurgical procedures over 2005, with botulinum toxin type A (Botox) injections topping the list (3.1 million procedures), followed by hyaluronic acid fillers (1.5 million), laser hair removal (1.4 million), microdermabrasion (993,000), and laser skin resurfacing (576,000). Most patients were aged 35–50 years. Average physician fees range from about $400 for collagen and Botox injections to $1,000 for poly-L-lactic acid (Sculptra) injections. ASAPS found that 17% of members it surveyed work with "legitimate" medical spas where nonsurgical procedures are offered. The society also noted that consumer backing of cosmetic surgery is at an all-time high. According to its survey (released in February) of 1,000 households, 63% of women and 61% of men said they approve of cosmetic surgery. A third of women and 18% of men said they'd consider cosmetic procedures for themselves in the future. The survey was sponsored by ASAPS and conducted by Synovate, an independent research firm.

Hill Wants Tanning Bed Study

Rep. Carolyn Maloney (D-N.Y.) and her colleagues in the House and Senate have introduced bills that would require the Food and Drug Administration to study whether current tanning bed warnings give consumers enough risk information. The legislation, HR 945, also would have the agency explore whether warnings suggested by the American Academy of Dermatology or other groups might be better, and test those warnings on consumers. A report would be due 1 year after enactment of the law. The Senate companion bill was introduced by Jack Reed (D-R.I.).

Coal Tar/Menthol OK for Dandruff

The FDA has ruled that a combination of 1.8% coal tar and 1.5% menthol is generally recognized as safe and effective when combined in dandruff and anti-itch shampoos. The agency proposed in December 2005 to accept those ingredients in combination for over-the-counter shampoos used to treat dandruff, seborrheic dermatitis, and psoriasis. It did not receive any comments on the proposal and issued the final rule on March 5, 2007. According to the FDA, manufacturers have the option to reformulate current shampoos that have coal tar to include menthol or to produce a new shampoo containing both ingredients.

Ex-FDA Chief Avoids Jail

Former FDA Commissioner Lester Crawford, D.V.M., Ph.D., will pay a $90,000 fine and perform 50 hours of community service under a sentence handed down by a U.S. District Court magistrate judge in late February. Dr. Crawford abruptly resigned his post in September 2005, with no explanation. He did not admit to any wrongdoing until October 2006, when he pleaded guilty to conflict of interest and false financial reporting. Prosecutors had determined that Dr. Crawford and his wife inappropriately held stocks in companies the FDA regulated—together earning $39,000 from options and dividends—and later paid taxes on those gains. Dr. Crawford had worked out a deal to pay $50,000 in exchange for no jail time. But Magistrate Judge Deborah A. Robinson found that prosecutors violated sentencing guidelines and she imposed the stiffer fine.

Majority Want Access Guarantee

Nearly two-thirds of Americans believe the federal government should guarantee access to health care, and 60% are willing to pay more in taxes for that guarantee, according to a poll released last month by The New York Times and CBS News. Half of those polled said they would be willing to pay as much as $500 a year in additional taxes, while nearly 8 in 10 said they thought it was more important to provide universal access to health insurance than to extend the Bush administration's tax cuts. In addition, a quarter of those with insurance said that they or someone in their household had gone without a medical test or treatment because insurance would not cover it; 60% of those without insurance reported the same situation. The nationwide telephone poll of 1,281 adults was conducted in late February 2007.

Health Spending Continues to Soar

Health care spending in the United States will continue to grow over the next decade, nearly doubling to $4.1 trillion by 2016, according to an analysis by the Centers for Medicare and Medicaid Services. The analysts project that the average annual growth in health care spending will remain at around 6.9% for the next 10 years. The findings were published in the Feb. 21 Web edition of Health Affairs. Prescription drug spending will continue to rise, they predict. By 2016, prescription drug spending is expected to reach $497.5 billion, more than double the spending for 2006. The rate of growth in physician and clinical spending is expected to slow down in the coming decade, according to the analysis. However, even with the deceleration, spending for physician services is expected to reach $819.9 billion by 2016. Physician spending in 2006 is projected at $447 billion. "As the nation moves from more traditional sources of insurance, such as employer-based coverage, to more federal- and state-provided health care, we will continue to face tough questions about how we finance our health care bill," John Poisal, deputy director of the National Health Statistics Group at CMS, said in a statement.

Surge in Nonsurgical Procedures

The latest data from the American Society for Aesthetic Plastic Surgery (ASAPS) show that the number of nonsurgical cosmetic procedures increased 747% in the last decade, far outstripping the 98% growth in surgical cosmetic procedures. In 2006, there was a 4% increase in nonsurgical procedures over 2005, with botulinum toxin type A (Botox) injections topping the list (3.1 million procedures), followed by hyaluronic acid fillers (1.5 million), laser hair removal (1.4 million), microdermabrasion (993,000), and laser skin resurfacing (576,000). Most patients were aged 35–50 years. Average physician fees range from about $400 for collagen and Botox injections to $1,000 for poly-L-lactic acid (Sculptra) injections. ASAPS found that 17% of members it surveyed work with "legitimate" medical spas where nonsurgical procedures are offered. The society also noted that consumer backing of cosmetic surgery is at an all-time high. According to its survey (released in February) of 1,000 households, 63% of women and 61% of men said they approve of cosmetic surgery. A third of women and 18% of men said they'd consider cosmetic procedures for themselves in the future. The survey was sponsored by ASAPS and conducted by Synovate, an independent research firm.

Hill Wants Tanning Bed Study

Rep. Carolyn Maloney (D-N.Y.) and her colleagues in the House and Senate have introduced bills that would require the Food and Drug Administration to study whether current tanning bed warnings give consumers enough risk information. The legislation, HR 945, also would have the agency explore whether warnings suggested by the American Academy of Dermatology or other groups might be better, and test those warnings on consumers. A report would be due 1 year after enactment of the law. The Senate companion bill was introduced by Jack Reed (D-R.I.).

Coal Tar/Menthol OK for Dandruff

The FDA has ruled that a combination of 1.8% coal tar and 1.5% menthol is generally recognized as safe and effective when combined in dandruff and anti-itch shampoos. The agency proposed in December 2005 to accept those ingredients in combination for over-the-counter shampoos used to treat dandruff, seborrheic dermatitis, and psoriasis. It did not receive any comments on the proposal and issued the final rule on March 5, 2007. According to the FDA, manufacturers have the option to reformulate current shampoos that have coal tar to include menthol or to produce a new shampoo containing both ingredients.

Ex-FDA Chief Avoids Jail

Former FDA Commissioner Lester Crawford, D.V.M., Ph.D., will pay a $90,000 fine and perform 50 hours of community service under a sentence handed down by a U.S. District Court magistrate judge in late February. Dr. Crawford abruptly resigned his post in September 2005, with no explanation. He did not admit to any wrongdoing until October 2006, when he pleaded guilty to conflict of interest and false financial reporting. Prosecutors had determined that Dr. Crawford and his wife inappropriately held stocks in companies the FDA regulated—together earning $39,000 from options and dividends—and later paid taxes on those gains. Dr. Crawford had worked out a deal to pay $50,000 in exchange for no jail time. But Magistrate Judge Deborah A. Robinson found that prosecutors violated sentencing guidelines and she imposed the stiffer fine.

Majority Want Access Guarantee

Nearly two-thirds of Americans believe the federal government should guarantee access to health care, and 60% are willing to pay more in taxes for that guarantee, according to a poll released last month by The New York Times and CBS News. Half of those polled said they would be willing to pay as much as $500 a year in additional taxes, while nearly 8 in 10 said they thought it was more important to provide universal access to health insurance than to extend the Bush administration's tax cuts. In addition, a quarter of those with insurance said that they or someone in their household had gone without a medical test or treatment because insurance would not cover it; 60% of those without insurance reported the same situation. The nationwide telephone poll of 1,281 adults was conducted in late February 2007.

Health Spending Continues to Soar

Health care spending in the United States will continue to grow over the next decade, nearly doubling to $4.1 trillion by 2016, according to an analysis by the Centers for Medicare and Medicaid Services. The analysts project that the average annual growth in health care spending will remain at around 6.9% for the next 10 years. The findings were published in the Feb. 21 Web edition of Health Affairs. Prescription drug spending will continue to rise, they predict. By 2016, prescription drug spending is expected to reach $497.5 billion, more than double the spending for 2006. The rate of growth in physician and clinical spending is expected to slow down in the coming decade, according to the analysis. However, even with the deceleration, spending for physician services is expected to reach $819.9 billion by 2016. Physician spending in 2006 is projected at $447 billion. "As the nation moves from more traditional sources of insurance, such as employer-based coverage, to more federal- and state-provided health care, we will continue to face tough questions about how we finance our health care bill," John Poisal, deputy director of the National Health Statistics Group at CMS, said in a statement.

Surge in Nonsurgical Procedures

The latest data from the American Society for Aesthetic Plastic Surgery (ASAPS) show that the number of nonsurgical cosmetic procedures increased 747% in the last decade, far outstripping the 98% growth in surgical cosmetic procedures. In 2006, there was a 4% increase in nonsurgical procedures over 2005, with botulinum toxin type A (Botox) injections topping the list (3.1 million procedures), followed by hyaluronic acid fillers (1.5 million), laser hair removal (1.4 million), microdermabrasion (993,000), and laser skin resurfacing (576,000). Most patients were aged 35–50 years. Average physician fees range from about $400 for collagen and Botox injections to $1,000 for poly-L-lactic acid (Sculptra) injections. ASAPS found that 17% of members it surveyed work with "legitimate" medical spas where nonsurgical procedures are offered. The society also noted that consumer backing of cosmetic surgery is at an all-time high. According to its survey (released in February) of 1,000 households, 63% of women and 61% of men said they approve of cosmetic surgery. A third of women and 18% of men said they'd consider cosmetic procedures for themselves in the future. The survey was sponsored by ASAPS and conducted by Synovate, an independent research firm.

Hill Wants Tanning Bed Study

Rep. Carolyn Maloney (D-N.Y.) and her colleagues in the House and Senate have introduced bills that would require the Food and Drug Administration to study whether current tanning bed warnings give consumers enough risk information. The legislation, HR 945, also would have the agency explore whether warnings suggested by the American Academy of Dermatology or other groups might be better, and test those warnings on consumers. A report would be due 1 year after enactment of the law. The Senate companion bill was introduced by Jack Reed (D-R.I.).

Coal Tar/Menthol OK for Dandruff

The FDA has ruled that a combination of 1.8% coal tar and 1.5% menthol is generally recognized as safe and effective when combined in dandruff and anti-itch shampoos. The agency proposed in December 2005 to accept those ingredients in combination for over-the-counter shampoos used to treat dandruff, seborrheic dermatitis, and psoriasis. It did not receive any comments on the proposal and issued the final rule on March 5, 2007. According to the FDA, manufacturers have the option to reformulate current shampoos that have coal tar to include menthol or to produce a new shampoo containing both ingredients.

Ex-FDA Chief Avoids Jail

Former FDA Commissioner Lester Crawford, D.V.M., Ph.D., will pay a $90,000 fine and perform 50 hours of community service under a sentence handed down by a U.S. District Court magistrate judge in late February. Dr. Crawford abruptly resigned his post in September 2005, with no explanation. He did not admit to any wrongdoing until October 2006, when he pleaded guilty to conflict of interest and false financial reporting. Prosecutors had determined that Dr. Crawford and his wife inappropriately held stocks in companies the FDA regulated—together earning $39,000 from options and dividends—and later paid taxes on those gains. Dr. Crawford had worked out a deal to pay $50,000 in exchange for no jail time. But Magistrate Judge Deborah A. Robinson found that prosecutors violated sentencing guidelines and she imposed the stiffer fine.

Majority Want Access Guarantee

Nearly two-thirds of Americans believe the federal government should guarantee access to health care, and 60% are willing to pay more in taxes for that guarantee, according to a poll released last month by The New York Times and CBS News. Half of those polled said they would be willing to pay as much as $500 a year in additional taxes, while nearly 8 in 10 said they thought it was more important to provide universal access to health insurance than to extend the Bush administration's tax cuts. In addition, a quarter of those with insurance said that they or someone in their household had gone without a medical test or treatment because insurance would not cover it; 60% of those without insurance reported the same situation. The nationwide telephone poll of 1,281 adults was conducted in late February 2007.

Health Spending Continues to Soar

Health care spending in the United States will continue to grow over the next decade, nearly doubling to $4.1 trillion by 2016, according to an analysis by the Centers for Medicare and Medicaid Services. The analysts project that the average annual growth in health care spending will remain at around 6.9% for the next 10 years. The findings were published in the Feb. 21 Web edition of Health Affairs. Prescription drug spending will continue to rise, they predict. By 2016, prescription drug spending is expected to reach $497.5 billion, more than double the spending for 2006. The rate of growth in physician and clinical spending is expected to slow down in the coming decade, according to the analysis. However, even with the deceleration, spending for physician services is expected to reach $819.9 billion by 2016. Physician spending in 2006 is projected at $447 billion. "As the nation moves from more traditional sources of insurance, such as employer-based coverage, to more federal- and state-provided health care, we will continue to face tough questions about how we finance our health care bill," John Poisal, deputy director of the National Health Statistics Group at CMS, said in a statement.

WASHINGTON — As a Senate panel opened debate on reauthorization of the State Children's Health Insurance Program, legislators had doubts about expanding coverage to an estimated 9 million children who are eligible but who have not yet been enrolled.

SCHIP is due to expire on Sept. 30, but most states have been straining in the last few years to pay for children already covered by the program, several witnesses said at a meeting of the Senate Finance Committee.

Members of the committee also acknowledged that reality.

“Congress has simply not given [SCHIP] enough funds to meet the current demand for services,” said committee chair Max Baucus (D-Mont.), who estimated that the program would need $12 billion-$15 billion over the next 5 years to maintain current coverage and $45 billion to bring all eligible children into SCHIP.

A last-minute deal signed into law at the end of 2006 allocated $271 million to cover anticipated shortfalls for a dozen or so states, but at least 14 more states will run out of SCHIP funds for fiscal 2007 if Congress does not enact another bailout by mid-May, said Sen. Baucus.

In 2007, states will spend an estimated $6.3 billion on SCHIP, but only $5 billion has been allotted, said Cindy Mann, executive director of the Georgetown University Center for Children and Families. Without an influx of federal cash, 37 states will run out of funds this year, Ms. Mann testified to the Finance Committee.

As of fiscal 2005, SCHIP had 6 million enrollees, according to a Government Accountability Office (GAO) report released at the Finance Committee hearing. Enrollment grew fastest during the early years of the program and leveled off more recently.

Georgia Gov. Sonny Perdue testified that there has been no slowing of enrollment in his state, with an average 19% per month increase since June 2005. About 273,000 children are covered in Georgia, making it the fourth-largest SCHIP program in the country, he said. The Centers for Medicare and Medicaid Services had projected that only 130,000 children were eligible in Georgia, he said.

But, because of SCHIP rules, states that cover more children end up receiving a smaller allotment for the following year. “The successful implementation of SCHIP in any state automatically undermines maintaining funding to keep these kids enrolled in the program,” Gov. Perdue testified, arguing for a change in the SCHIP funding formula.

Some senators questioned whether states' flexibility should be reined in, saying that some initiatives might be diluting the program's intent—to cover low-income children.

Generally, federal law allows states to cover children in families with incomes up to 200% of the poverty level or 50 percentage points above the Medicaid eligibility standard as of 1997. According to the GAO report, seven states were covering families with incomes at 300% of the poverty level or higher. Thirty-nine states require some cost sharing by families, but 11 states charge no premiums or copayments.

Fifteen states cover adults. These are generally parents of Medicaid- or SCHIP-eligible children, pregnant women, or childless adults. The Health and Human Services department has granted waivers for those states, said Kathryn G. Allen, director of health care at the GAO.

Sen. Charles Grassley (R-Iowa), ranking minority member of the Finance Committee, said he was interested in giving states more flexibility but was not happy about extending coverage to adults.

“The issue is whether SCHIP funds used to cover adults has drained resources targeted by Congress for kids,” said Sen. Grassley. “The 'C' stands for children. There is no 'A' in SCHIP.”

Sen. Orrin Hatch (R-Utah) also questioned how states had been allowed to extend SCHIP benefits to adults.

“We have to question whether these waivers have been properly approved,” said Sen. Hatch.

Ms. Mann counseled senators to keep adult coverage in perspective, noting that only 600,000 of the 6 million SCHIP enrollees are adults. She added that it has been shown that when parents and children have health insurance, the whole family benefits.

WASHINGTON — As a Senate panel opened debate on reauthorization of the State Children's Health Insurance Program, legislators had doubts about expanding coverage to an estimated 9 million children who are eligible but who have not yet been enrolled.

SCHIP is due to expire on Sept. 30, but most states have been straining in the last few years to pay for children already covered by the program, several witnesses said at a meeting of the Senate Finance Committee.

Members of the committee also acknowledged that reality.

“Congress has simply not given [SCHIP] enough funds to meet the current demand for services,” said committee chair Max Baucus (D-Mont.), who estimated that the program would need $12 billion-$15 billion over the next 5 years to maintain current coverage and $45 billion to bring all eligible children into SCHIP.

A last-minute deal signed into law at the end of 2006 allocated $271 million to cover anticipated shortfalls for a dozen or so states, but at least 14 more states will run out of SCHIP funds for fiscal 2007 if Congress does not enact another bailout by mid-May, said Sen. Baucus.

In 2007, states will spend an estimated $6.3 billion on SCHIP, but only $5 billion has been allotted, said Cindy Mann, executive director of the Georgetown University Center for Children and Families. Without an influx of federal cash, 37 states will run out of funds this year, Ms. Mann testified to the Finance Committee.

As of fiscal 2005, SCHIP had 6 million enrollees, according to a Government Accountability Office (GAO) report released at the Finance Committee hearing. Enrollment grew fastest during the early years of the program and leveled off more recently.

Georgia Gov. Sonny Perdue testified that there has been no slowing of enrollment in his state, with an average 19% per month increase since June 2005. About 273,000 children are covered in Georgia, making it the fourth-largest SCHIP program in the country, he said. The Centers for Medicare and Medicaid Services had projected that only 130,000 children were eligible in Georgia, he said.

But, because of SCHIP rules, states that cover more children end up receiving a smaller allotment for the following year. “The successful implementation of SCHIP in any state automatically undermines maintaining funding to keep these kids enrolled in the program,” Gov. Perdue testified, arguing for a change in the SCHIP funding formula.

Some senators questioned whether states' flexibility should be reined in, saying that some initiatives might be diluting the program's intent—to cover low-income children.

Generally, federal law allows states to cover children in families with incomes up to 200% of the poverty level or 50 percentage points above the Medicaid eligibility standard as of 1997. According to the GAO report, seven states were covering families with incomes at 300% of the poverty level or higher. Thirty-nine states require some cost sharing by families, but 11 states charge no premiums or copayments.

Fifteen states cover adults. These are generally parents of Medicaid- or SCHIP-eligible children, pregnant women, or childless adults. The Health and Human Services department has granted waivers for those states, said Kathryn G. Allen, director of health care at the GAO.

Sen. Charles Grassley (R-Iowa), ranking minority member of the Finance Committee, said he was interested in giving states more flexibility but was not happy about extending coverage to adults.

“The issue is whether SCHIP funds used to cover adults has drained resources targeted by Congress for kids,” said Sen. Grassley. “The 'C' stands for children. There is no 'A' in SCHIP.”

Sen. Orrin Hatch (R-Utah) also questioned how states had been allowed to extend SCHIP benefits to adults.

“We have to question whether these waivers have been properly approved,” said Sen. Hatch.

Ms. Mann counseled senators to keep adult coverage in perspective, noting that only 600,000 of the 6 million SCHIP enrollees are adults. She added that it has been shown that when parents and children have health insurance, the whole family benefits.

WASHINGTON — As a Senate panel opened debate on reauthorization of the State Children's Health Insurance Program, legislators had doubts about expanding coverage to an estimated 9 million children who are eligible but who have not yet been enrolled.

SCHIP is due to expire on Sept. 30, but most states have been straining in the last few years to pay for children already covered by the program, several witnesses said at a meeting of the Senate Finance Committee.

Members of the committee also acknowledged that reality.

“Congress has simply not given [SCHIP] enough funds to meet the current demand for services,” said committee chair Max Baucus (D-Mont.), who estimated that the program would need $12 billion-$15 billion over the next 5 years to maintain current coverage and $45 billion to bring all eligible children into SCHIP.

A last-minute deal signed into law at the end of 2006 allocated $271 million to cover anticipated shortfalls for a dozen or so states, but at least 14 more states will run out of SCHIP funds for fiscal 2007 if Congress does not enact another bailout by mid-May, said Sen. Baucus.

In 2007, states will spend an estimated $6.3 billion on SCHIP, but only $5 billion has been allotted, said Cindy Mann, executive director of the Georgetown University Center for Children and Families. Without an influx of federal cash, 37 states will run out of funds this year, Ms. Mann testified to the Finance Committee.

As of fiscal 2005, SCHIP had 6 million enrollees, according to a Government Accountability Office (GAO) report released at the Finance Committee hearing. Enrollment grew fastest during the early years of the program and leveled off more recently.

Georgia Gov. Sonny Perdue testified that there has been no slowing of enrollment in his state, with an average 19% per month increase since June 2005. About 273,000 children are covered in Georgia, making it the fourth-largest SCHIP program in the country, he said. The Centers for Medicare and Medicaid Services had projected that only 130,000 children were eligible in Georgia, he said.

But, because of SCHIP rules, states that cover more children end up receiving a smaller allotment for the following year. “The successful implementation of SCHIP in any state automatically undermines maintaining funding to keep these kids enrolled in the program,” Gov. Perdue testified, arguing for a change in the SCHIP funding formula.

Some senators questioned whether states' flexibility should be reined in, saying that some initiatives might be diluting the program's intent—to cover low-income children.

Generally, federal law allows states to cover children in families with incomes up to 200% of the poverty level or 50 percentage points above the Medicaid eligibility standard as of 1997. According to the GAO report, seven states were covering families with incomes at 300% of the poverty level or higher. Thirty-nine states require some cost sharing by families, but 11 states charge no premiums or copayments.

Fifteen states cover adults. These are generally parents of Medicaid- or SCHIP-eligible children, pregnant women, or childless adults. The Health and Human Services department has granted waivers for those states, said Kathryn G. Allen, director of health care at the GAO.

Sen. Charles Grassley (R-Iowa), ranking minority member of the Finance Committee, said he was interested in giving states more flexibility but was not happy about extending coverage to adults.

“The issue is whether SCHIP funds used to cover adults has drained resources targeted by Congress for kids,” said Sen. Grassley. “The 'C' stands for children. There is no 'A' in SCHIP.”

Sen. Orrin Hatch (R-Utah) also questioned how states had been allowed to extend SCHIP benefits to adults.

“We have to question whether these waivers have been properly approved,” said Sen. Hatch.

Ms. Mann counseled senators to keep adult coverage in perspective, noting that only 600,000 of the 6 million SCHIP enrollees are adults. She added that it has been shown that when parents and children have health insurance, the whole family benefits.

Several large employers and employer coalitions are finding that it may be a worthwhile gamble to reduce or eliminate copayments for medications that control diabetes or treat comorbid conditions.

Pitney Bowes, for instance, reduced copays for diabetes drugs, as well as for asthma drugs, in 2001. The company realized first-year savings of about $1 million, according to an article published online in the Jan. 30 issue of Health Affairs.

Diabetes is a fat target. Some 20 million Americans have the condition, leading to $132 billion in medical costs, disability, and lost productivity, according to the University of Michigan, one of the employers that recently launched a reduced-copay program. However, only about half of diabetes patients stick to their prescribed medication regimens, which can include as many as a dozen therapies. Out-of-pocket costs for those medications add up, and this may deter patients from adhering to their treatment plans, according to the university.

These reduced copay programs are in stark contrast to a trend toward shifting costs onto workers. Copays for pharmaceuticals in particular have grown in the last decade. Making consumers shoulder more of the cost has helped bring down prescription drug spending from double-digit growth rates. Overall drug spending is expected to rise from $201 billion in 2005 to $214 billion in 2006—a 6.5% increase, according to Centers for Medicare and Medicaid Services analysts.

But overall health spending continues to grow, and will increase at least 7% annually over the next 10 years, according to CMS data.

And, higher copays can backfire. “When cost sharing is too large in relation to a consumer's resources, the result is either serious financial strain or reduced access to care,” according to an analysis issued in February by Ha Tu and Paul Ginsburg of the Center for Studying Health System Change. The authors also found that these benefit structures “do not distinguish between services that are considered extremely important, such as testing, insulin, and physician visits to manage diabetes, and services that are more elective, such as knee surgery to play recreational sports.”

It seems counterproductive to erect hurdles that might prevent patients from accessing proven effective therapies for diabetes, Dr. William Herman said in an interview. Dr. Herman is medical director of M-Care, an HMO participating in the University of Michigan's 2-year pilot program for employees that aims to determine if reducing the cost of diabetes drugs will encourage more patients to stick to their treatment regimens and also cut overall health costs.

“If these copayments are interfering with desired processes of care and adversely affecting health outcomes, then this is not something we want in our benefit design,” said Dr. Herman.

Employees began enrolling in the Michigan program in July 2006. If they already were receiving an oral antidiabetic agent or insulin, they were automatically signed up. About 2,100 of those covered by university health plans are participating, out of a total worker and dependent population of 60,000, said Dr. Herman.

Under the program, enrollees can get free yearly eye exams and they pay nothing for generics (compared with $7 normally), $7 for preferred brands (instead of $14), and $18 for nonpreferred brands (instead of $24). These copays also apply to other drugs taken by diabetes patients, including β-blockers, calcium channel blockers, lipid-lowering agents, antihypertensives, and antidepressants.

Two-thirds of the prescriptions are generics, almost a third are in the preferred tier, and very few are in the nonpreferred tier, Dr. Herman said.

University workers belong to a variety of health plans, but they all receive their prescriptions through a single pharmacy benefit manager. That will allow for easier tracking of medication uptake and compliance, said Dr. Herman. Through its HMO, the university also will be able to compare medication compliance and health outcomes between diabetic workers and diabetes patients who aren't employees, he said.

So far, the program is costing the university about $30,000 a month, Dr. Herman said. That's how much patients are not spending. There are no data yet on changes in hemoglobin A_1c levels, lipid levels, or medication uptake. If there are positive changes, the university is likely to stick with the reduced and waived copays, said Dr. Herman. The school also has looked at making similar reductions for other chronic diseases.

The Michigan program is unique in that patients do not have to enroll in a disease management program. Other employers have coupled reduced or waived copays with coaching from pharmacists.

That model was pioneered by employers in Asheville, N.C., and the North Carolina Center for Pharmaceutical Care. The program began in 1997 with 47 employer-participants. By 2003, those employers were reporting improved A_1c levels, a 50% reduction in average annual sick leave, and overall medical costs 58% below the expected level (J. Am. Pharm. Assoc. Wash. 2003;43:173–84). Employers saved $1,600–$3,300 per worker because of fewer emergency department visits and fewer diabetes-related hospitalizations, according to the American Pharmacists Association Foundation.

Soon after those results were published, the APhA Foundation, with financial backing from GlaxoSmithKline, created an initiative patterned after the Asheville Project. Thirty employers in 10 cities are now participating in the Diabetes Ten City Challenge. The employers include municipal and county governments, utilities, supermarket chains, schools, health care systems, universities, and corporations in Charleston and Spartanburg, S.C.; Chicago; Colorado Springs; Cumberland, Md.; Dalton, Ga.; Honolulu; Los Angeles; Milwaukee; Pittsburgh; and Tampa Bay, Fla.

More than 1,100 diabetics are participating among the 30 employers, Bill Ellis, executive director and CEO of the APhA Foundation, said in an interview.

The majority—70%–-are white; 19% are African American and 40% are aged 50–59 years. About a quarter are aged over 60 years, and 22% are aged 40–49.

It is a voluntary program, but once in, patients have to agree to meet with an assigned pharmacist—about 4–7 times yearly—for education and training, and to show they are working toward certain goals such as getting annual eye and foot exams. The pharmacists set the goals, but patients are prompted to consult regularly with their physicians, said Mr. Ellis.

In return, the cost of diabetes medication is reduced or eliminated, depending on the employer's benefit design, he said. On average, patients save $400 a year, said Mr. Ellis. Employers foot the bill for the pharmacists' fees and the copays. In some cases, they may also cover medications that have been found to be effective in managing diabetes complications, he said.

The employer participants and the APhA Foundation are tracking clinical and economic outcomes and will eventually report those, along with patient satisfaction scores.

Although employers are in many cases contributing a significant amount of money up front, they are willing to, said Mr. Ellis. “They're making an investment in keeping people well,” he said.

Nancy Kennedy, executive director of the Dalton, Ga.-based Northwest Georgia Healthcare Partnership, said in an interview that her member companies were interested in the diabetes program because a majority of their health care dollars go to that disease. Half of the jobs in Dalton are in manufacturing (mostly carpets) and surrounding Whitfield County has a large Hispanic population. Hispanics have a 1.5 times higher prevalence of diabetes than do whites, which makes the condition a major concern for the northwest Georgia companies.

Several large employers and employer coalitions are finding that it may be a worthwhile gamble to reduce or eliminate copayments for medications that control diabetes or treat comorbid conditions.

Pitney Bowes, for instance, reduced copays for diabetes drugs, as well as for asthma drugs, in 2001. The company realized first-year savings of about $1 million, according to an article published online in the Jan. 30 issue of Health Affairs.

Diabetes is a fat target. Some 20 million Americans have the condition, leading to $132 billion in medical costs, disability, and lost productivity, according to the University of Michigan, one of the employers that recently launched a reduced-copay program. However, only about half of diabetes patients stick to their prescribed medication regimens, which can include as many as a dozen therapies. Out-of-pocket costs for those medications add up, and this may deter patients from adhering to their treatment plans, according to the university.

These reduced copay programs are in stark contrast to a trend toward shifting costs onto workers. Copays for pharmaceuticals in particular have grown in the last decade. Making consumers shoulder more of the cost has helped bring down prescription drug spending from double-digit growth rates. Overall drug spending is expected to rise from $201 billion in 2005 to $214 billion in 2006—a 6.5% increase, according to Centers for Medicare and Medicaid Services analysts.

But overall health spending continues to grow, and will increase at least 7% annually over the next 10 years, according to CMS data.

And, higher copays can backfire. “When cost sharing is too large in relation to a consumer's resources, the result is either serious financial strain or reduced access to care,” according to an analysis issued in February by Ha Tu and Paul Ginsburg of the Center for Studying Health System Change. The authors also found that these benefit structures “do not distinguish between services that are considered extremely important, such as testing, insulin, and physician visits to manage diabetes, and services that are more elective, such as knee surgery to play recreational sports.”

It seems counterproductive to erect hurdles that might prevent patients from accessing proven effective therapies for diabetes, Dr. William Herman said in an interview. Dr. Herman is medical director of M-Care, an HMO participating in the University of Michigan's 2-year pilot program for employees that aims to determine if reducing the cost of diabetes drugs will encourage more patients to stick to their treatment regimens and also cut overall health costs.

“If these copayments are interfering with desired processes of care and adversely affecting health outcomes, then this is not something we want in our benefit design,” said Dr. Herman.

Employees began enrolling in the Michigan program in July 2006. If they already were receiving an oral antidiabetic agent or insulin, they were automatically signed up. About 2,100 of those covered by university health plans are participating, out of a total worker and dependent population of 60,000, said Dr. Herman.

Under the program, enrollees can get free yearly eye exams and they pay nothing for generics (compared with $7 normally), $7 for preferred brands (instead of $14), and $18 for nonpreferred brands (instead of $24). These copays also apply to other drugs taken by diabetes patients, including β-blockers, calcium channel blockers, lipid-lowering agents, antihypertensives, and antidepressants.

Two-thirds of the prescriptions are generics, almost a third are in the preferred tier, and very few are in the nonpreferred tier, Dr. Herman said.

University workers belong to a variety of health plans, but they all receive their prescriptions through a single pharmacy benefit manager. That will allow for easier tracking of medication uptake and compliance, said Dr. Herman. Through its HMO, the university also will be able to compare medication compliance and health outcomes between diabetic workers and diabetes patients who aren't employees, he said.

So far, the program is costing the university about $30,000 a month, Dr. Herman said. That's how much patients are not spending. There are no data yet on changes in hemoglobin A_1c levels, lipid levels, or medication uptake. If there are positive changes, the university is likely to stick with the reduced and waived copays, said Dr. Herman. The school also has looked at making similar reductions for other chronic diseases.

The Michigan program is unique in that patients do not have to enroll in a disease management program. Other employers have coupled reduced or waived copays with coaching from pharmacists.

That model was pioneered by employers in Asheville, N.C., and the North Carolina Center for Pharmaceutical Care. The program began in 1997 with 47 employer-participants. By 2003, those employers were reporting improved A_1c levels, a 50% reduction in average annual sick leave, and overall medical costs 58% below the expected level (J. Am. Pharm. Assoc. Wash. 2003;43:173–84). Employers saved $1,600–$3,300 per worker because of fewer emergency department visits and fewer diabetes-related hospitalizations, according to the American Pharmacists Association Foundation.

Soon after those results were published, the APhA Foundation, with financial backing from GlaxoSmithKline, created an initiative patterned after the Asheville Project. Thirty employers in 10 cities are now participating in the Diabetes Ten City Challenge. The employers include municipal and county governments, utilities, supermarket chains, schools, health care systems, universities, and corporations in Charleston and Spartanburg, S.C.; Chicago; Colorado Springs; Cumberland, Md.; Dalton, Ga.; Honolulu; Los Angeles; Milwaukee; Pittsburgh; and Tampa Bay, Fla.

More than 1,100 diabetics are participating among the 30 employers, Bill Ellis, executive director and CEO of the APhA Foundation, said in an interview.

The majority—70%–-are white; 19% are African American and 40% are aged 50–59 years. About a quarter are aged over 60 years, and 22% are aged 40–49.

It is a voluntary program, but once in, patients have to agree to meet with an assigned pharmacist—about 4–7 times yearly—for education and training, and to show they are working toward certain goals such as getting annual eye and foot exams. The pharmacists set the goals, but patients are prompted to consult regularly with their physicians, said Mr. Ellis.

In return, the cost of diabetes medication is reduced or eliminated, depending on the employer's benefit design, he said. On average, patients save $400 a year, said Mr. Ellis. Employers foot the bill for the pharmacists' fees and the copays. In some cases, they may also cover medications that have been found to be effective in managing diabetes complications, he said.

The employer participants and the APhA Foundation are tracking clinical and economic outcomes and will eventually report those, along with patient satisfaction scores.

Although employers are in many cases contributing a significant amount of money up front, they are willing to, said Mr. Ellis. “They're making an investment in keeping people well,” he said.

Nancy Kennedy, executive director of the Dalton, Ga.-based Northwest Georgia Healthcare Partnership, said in an interview that her member companies were interested in the diabetes program because a majority of their health care dollars go to that disease. Half of the jobs in Dalton are in manufacturing (mostly carpets) and surrounding Whitfield County has a large Hispanic population. Hispanics have a 1.5 times higher prevalence of diabetes than do whites, which makes the condition a major concern for the northwest Georgia companies.

Several large employers and employer coalitions are finding that it may be a worthwhile gamble to reduce or eliminate copayments for medications that control diabetes or treat comorbid conditions.

Pitney Bowes, for instance, reduced copays for diabetes drugs, as well as for asthma drugs, in 2001. The company realized first-year savings of about $1 million, according to an article published online in the Jan. 30 issue of Health Affairs.

Diabetes is a fat target. Some 20 million Americans have the condition, leading to $132 billion in medical costs, disability, and lost productivity, according to the University of Michigan, one of the employers that recently launched a reduced-copay program. However, only about half of diabetes patients stick to their prescribed medication regimens, which can include as many as a dozen therapies. Out-of-pocket costs for those medications add up, and this may deter patients from adhering to their treatment plans, according to the university.

These reduced copay programs are in stark contrast to a trend toward shifting costs onto workers. Copays for pharmaceuticals in particular have grown in the last decade. Making consumers shoulder more of the cost has helped bring down prescription drug spending from double-digit growth rates. Overall drug spending is expected to rise from $201 billion in 2005 to $214 billion in 2006—a 6.5% increase, according to Centers for Medicare and Medicaid Services analysts.

But overall health spending continues to grow, and will increase at least 7% annually over the next 10 years, according to CMS data.

And, higher copays can backfire. “When cost sharing is too large in relation to a consumer's resources, the result is either serious financial strain or reduced access to care,” according to an analysis issued in February by Ha Tu and Paul Ginsburg of the Center for Studying Health System Change. The authors also found that these benefit structures “do not distinguish between services that are considered extremely important, such as testing, insulin, and physician visits to manage diabetes, and services that are more elective, such as knee surgery to play recreational sports.”

It seems counterproductive to erect hurdles that might prevent patients from accessing proven effective therapies for diabetes, Dr. William Herman said in an interview. Dr. Herman is medical director of M-Care, an HMO participating in the University of Michigan's 2-year pilot program for employees that aims to determine if reducing the cost of diabetes drugs will encourage more patients to stick to their treatment regimens and also cut overall health costs.

“If these copayments are interfering with desired processes of care and adversely affecting health outcomes, then this is not something we want in our benefit design,” said Dr. Herman.

Employees began enrolling in the Michigan program in July 2006. If they already were receiving an oral antidiabetic agent or insulin, they were automatically signed up. About 2,100 of those covered by university health plans are participating, out of a total worker and dependent population of 60,000, said Dr. Herman.

Under the program, enrollees can get free yearly eye exams and they pay nothing for generics (compared with $7 normally), $7 for preferred brands (instead of $14), and $18 for nonpreferred brands (instead of $24). These copays also apply to other drugs taken by diabetes patients, including β-blockers, calcium channel blockers, lipid-lowering agents, antihypertensives, and antidepressants.

Two-thirds of the prescriptions are generics, almost a third are in the preferred tier, and very few are in the nonpreferred tier, Dr. Herman said.

University workers belong to a variety of health plans, but they all receive their prescriptions through a single pharmacy benefit manager. That will allow for easier tracking of medication uptake and compliance, said Dr. Herman. Through its HMO, the university also will be able to compare medication compliance and health outcomes between diabetic workers and diabetes patients who aren't employees, he said.

So far, the program is costing the university about $30,000 a month, Dr. Herman said. That's how much patients are not spending. There are no data yet on changes in hemoglobin A_1c levels, lipid levels, or medication uptake. If there are positive changes, the university is likely to stick with the reduced and waived copays, said Dr. Herman. The school also has looked at making similar reductions for other chronic diseases.

The Michigan program is unique in that patients do not have to enroll in a disease management program. Other employers have coupled reduced or waived copays with coaching from pharmacists.

That model was pioneered by employers in Asheville, N.C., and the North Carolina Center for Pharmaceutical Care. The program began in 1997 with 47 employer-participants. By 2003, those employers were reporting improved A_1c levels, a 50% reduction in average annual sick leave, and overall medical costs 58% below the expected level (J. Am. Pharm. Assoc. Wash. 2003;43:173–84). Employers saved $1,600–$3,300 per worker because of fewer emergency department visits and fewer diabetes-related hospitalizations, according to the American Pharmacists Association Foundation.

Soon after those results were published, the APhA Foundation, with financial backing from GlaxoSmithKline, created an initiative patterned after the Asheville Project. Thirty employers in 10 cities are now participating in the Diabetes Ten City Challenge. The employers include municipal and county governments, utilities, supermarket chains, schools, health care systems, universities, and corporations in Charleston and Spartanburg, S.C.; Chicago; Colorado Springs; Cumberland, Md.; Dalton, Ga.; Honolulu; Los Angeles; Milwaukee; Pittsburgh; and Tampa Bay, Fla.

More than 1,100 diabetics are participating among the 30 employers, Bill Ellis, executive director and CEO of the APhA Foundation, said in an interview.

The majority—70%–-are white; 19% are African American and 40% are aged 50–59 years. About a quarter are aged over 60 years, and 22% are aged 40–49.

It is a voluntary program, but once in, patients have to agree to meet with an assigned pharmacist—about 4–7 times yearly—for education and training, and to show they are working toward certain goals such as getting annual eye and foot exams. The pharmacists set the goals, but patients are prompted to consult regularly with their physicians, said Mr. Ellis.

In return, the cost of diabetes medication is reduced or eliminated, depending on the employer's benefit design, he said. On average, patients save $400 a year, said Mr. Ellis. Employers foot the bill for the pharmacists' fees and the copays. In some cases, they may also cover medications that have been found to be effective in managing diabetes complications, he said.

The employer participants and the APhA Foundation are tracking clinical and economic outcomes and will eventually report those, along with patient satisfaction scores.

Although employers are in many cases contributing a significant amount of money up front, they are willing to, said Mr. Ellis. “They're making an investment in keeping people well,” he said.

Nancy Kennedy, executive director of the Dalton, Ga.-based Northwest Georgia Healthcare Partnership, said in an interview that her member companies were interested in the diabetes program because a majority of their health care dollars go to that disease. Half of the jobs in Dalton are in manufacturing (mostly carpets) and surrounding Whitfield County has a large Hispanic population. Hispanics have a 1.5 times higher prevalence of diabetes than do whites, which makes the condition a major concern for the northwest Georgia companies.

The Food and Drug Administration has issued a final rule that would require medical glove makers to improve their products' ability to serve as a barrier against pathogens.

Manufacturers are being given 2 years to comply with the new regulations.

The goal is to reduce the risk of transmission of bloodborne pathogens such as HIV and hepatitis B, according to the FDA. While the agency can't quantify how many cases might be prevented with better barriers, it estimated that approximately 2.4 HIV infections occur each year due to “problems with the barrier protection properties of gloves used in health-care settings.”

The FDA estimates that 140 health care workers are infected with the hepatitis B virus (HBV) on the job each year, primarily from percutaneous injuries. About a third, or 40 cases, may be due to glove defects, according to the agency.

There is less evidence that glove defects are associated with hepatitis C, said the agency, noting that most occupational exposures are from needle sticks.

The agency has inspected gloves—used for patient examinations and surgical procedures—since 1990. At that time, the International Organization for Standardization (ISO), ASTM International, and the FDA had the same standards for glove quality. A few years later, the ISO and ASTM began requiring higher standards.

The agency has allowed a defect rate of 4% for gloves used during patient exams and 2.5% for gloves used in surgery.

With more and more brands of gloves being marketed and sold, the agency hopes to maintain that defect rate. To do so means increasing the quality standards, said the agency.

The FDA estimates that about 2% of the 39.2 billion gloves currently marketed are defective—some 940 million gloves.

The Food and Drug Administration has issued a final rule that would require medical glove makers to improve their products' ability to serve as a barrier against pathogens.

Manufacturers are being given 2 years to comply with the new regulations.

The goal is to reduce the risk of transmission of bloodborne pathogens such as HIV and hepatitis B, according to the FDA. While the agency can't quantify how many cases might be prevented with better barriers, it estimated that approximately 2.4 HIV infections occur each year due to “problems with the barrier protection properties of gloves used in health-care settings.”

The FDA estimates that 140 health care workers are infected with the hepatitis B virus (HBV) on the job each year, primarily from percutaneous injuries. About a third, or 40 cases, may be due to glove defects, according to the agency.

There is less evidence that glove defects are associated with hepatitis C, said the agency, noting that most occupational exposures are from needle sticks.

The agency has inspected gloves—used for patient examinations and surgical procedures—since 1990. At that time, the International Organization for Standardization (ISO), ASTM International, and the FDA had the same standards for glove quality. A few years later, the ISO and ASTM began requiring higher standards.

The agency has allowed a defect rate of 4% for gloves used during patient exams and 2.5% for gloves used in surgery.

With more and more brands of gloves being marketed and sold, the agency hopes to maintain that defect rate. To do so means increasing the quality standards, said the agency.

The FDA estimates that about 2% of the 39.2 billion gloves currently marketed are defective—some 940 million gloves.

The Food and Drug Administration has issued a final rule that would require medical glove makers to improve their products' ability to serve as a barrier against pathogens.

Manufacturers are being given 2 years to comply with the new regulations.

The goal is to reduce the risk of transmission of bloodborne pathogens such as HIV and hepatitis B, according to the FDA. While the agency can't quantify how many cases might be prevented with better barriers, it estimated that approximately 2.4 HIV infections occur each year due to “problems with the barrier protection properties of gloves used in health-care settings.”

The FDA estimates that 140 health care workers are infected with the hepatitis B virus (HBV) on the job each year, primarily from percutaneous injuries. About a third, or 40 cases, may be due to glove defects, according to the agency.

There is less evidence that glove defects are associated with hepatitis C, said the agency, noting that most occupational exposures are from needle sticks.

The agency has inspected gloves—used for patient examinations and surgical procedures—since 1990. At that time, the International Organization for Standardization (ISO), ASTM International, and the FDA had the same standards for glove quality. A few years later, the ISO and ASTM began requiring higher standards.

The agency has allowed a defect rate of 4% for gloves used during patient exams and 2.5% for gloves used in surgery.

With more and more brands of gloves being marketed and sold, the agency hopes to maintain that defect rate. To do so means increasing the quality standards, said the agency.

The FDA estimates that about 2% of the 39.2 billion gloves currently marketed are defective—some 940 million gloves.

FDA to Regulate Tobacco?

It seemed like back to the future in Washington on Feb. 15, when Sen. Edward M. Kennedy (D-Mass.) presided at a press briefing announcing a proposal that would give the Food and Drug Administration the authority to regulate cigarettes as a drug delivery device. In the mid-1990s, Dr. David Kessler, then FDA commissioner, made a bid to do just that, but lost in a battle that ended at the Supreme Court. Since that time, congressional bids to extend FDA's purview have failed. Sen. Kennedy declared that 2007 is the lucky year. “The likelihood of passage is extremely high,” he said of his bill, which according to cosponsor Sen. John Cornyn (R-Tex.) already has 30 allies, 11 of them Republicans. Rep. Henry Waxman (D-Calif.), introducing the House companion bill, agreed that, “this is the year it will become law,” noting that 100 of his colleagues are ready to sign on. The bill would give FDA more power to restrict tobacco ads and sales to children in particular, require reduction of nicotine levels, and necessitate bigger and more informative warnings on tobacco products. FDA could not ban nicotine-containing products. President George W. Bush has not shown support, but Sen. Cornyn said he'd encourage him to sign it into law if the bill passes the House and Senate.

HEART for Women Reintroduced

The American Heart Association is throwing its weight behind the Heart Disease Education, Analysis and Research, and Treatment (HEART) for Women Act, which was reintroduced in both the House and Senate last month. Sponsored by Sen. Debbie Stabenow (D-Mich.) and Sen. Lisa Murkowski (R-Alaska), the legislation authorizes the Health and Human Services department to provide education to older women and health care professionals on the diagnosis and treatment of women with heart disease, requires gender-specific reporting of heart disease data to the federal government, and expands WISEWOMAN (Well-Integrated Screening and Evaluation for Women Across the Nation), the free heart disease and stroke screening program, beyond its current 14 states. The legislation also is backed by the Society for Women's Health Research, WomenHeart: the National Coalition for Women with Heart Disease, and the Association of Black Cardiologists Inc.

Cardio Tops Drug, Hospital Costs

New data from the Agency for Healthcare Research and Quality show that drugs for cardiovascular disorders are the most costly and that heart disease, stroke, and other circulatory conditions account for one in six hospitalizations. Americans spent $32 billion on drugs for cardiovascular conditions in 2004. The two biggest categories were cardiovascular drugs ($17 billion) and cholesterol-lowering drugs ($10 billion). Although 44% of adults bought a central nervous system drug, compared with 38% buying a cardiovascular drug and 22% a cholesterol cutter, spending for CNS drugs was only $7 billion. Circulatory system diseases put 7 million people in the hospital in 2004. The most common reasons: atherosclerosis (1.2 million stays), congestive heart failure (1.1 million), nonspecific chest pain (846,000), heart attack (695,000), and irregular heart beat (694,000).

FDA's $2 Billion Budget

The Bush administration is requesting $2.1 billion for the FDA in fiscal 2008, a 5% increase from the previous year's request. The agency still has not received its final appropriation for fiscal 2007, so the exact amount it will receive for that year is not known yet. The budget includes $444 million in user fees from industry, including a new program to charge generic drug makers fees to review their products. The agency estimates that generic companies will contribute $16 million in fiscal 2008. In a statement, Generic Pharmaceutical Association CEO Kathleen Jaeger said the decision to seek user fees “will not bring generic medicines to consumers faster as long as brand companies are still permitted to use tactics that delay market entry.” The budget also includes $11 million for improving drug safety (this does not include user fee funds that also will go to that effort) and $7 million to boost medical device safety and to speed up device review. The agency also is requesting $13 million to move about 1,300 employees of the Center for Devices and Radiological Health to offices at the FDA's new White Oak, Md., campus. The FDA gradually has been moving its operations to the new facilities. The Washington-based consumer-, patient- and industry-supported Coalition for a Stronger FDA said the budget did not go far enough. It is seeking at least $175 million more, including greater increases for food, drug, and medical device safety.

Medicare Generic Drug Use Rises

The Centers for Medicare and Medicaid Services says that generic drugs accounted for 60% of the prescriptions dispensed to people who receive benefits through either Part D or Medicare Advantage plans for the first three quarters of 2006. Generic drug use among Part D enrollees is 13% higher than it is for Americans who receive benefits through private payers, said the CMS. The agency said that in 2006, generics accounted for 53% of prescriptions dispensed to privately insured Americans. Greater use of generics will translate into lower costs for the Part D program and possibly expanded coverage for beneficiaries, according to the CMS. “We will continue to promote generics where they are available as an important strategy to keep the new drug benefit affordable over the long term,” CMS Acting Administrator Leslie V. Norwalk said in a statement.

FDA to Regulate Tobacco?

It seemed like back to the future in Washington on Feb. 15, when Sen. Edward M. Kennedy (D-Mass.) presided at a press briefing announcing a proposal that would give the Food and Drug Administration the authority to regulate cigarettes as a drug delivery device. In the mid-1990s, Dr. David Kessler, then FDA commissioner, made a bid to do just that, but lost in a battle that ended at the Supreme Court. Since that time, congressional bids to extend FDA's purview have failed. Sen. Kennedy declared that 2007 is the lucky year. “The likelihood of passage is extremely high,” he said of his bill, which according to cosponsor Sen. John Cornyn (R-Tex.) already has 30 allies, 11 of them Republicans. Rep. Henry Waxman (D-Calif.), introducing the House companion bill, agreed that, “this is the year it will become law,” noting that 100 of his colleagues are ready to sign on. The bill would give FDA more power to restrict tobacco ads and sales to children in particular, require reduction of nicotine levels, and necessitate bigger and more informative warnings on tobacco products. FDA could not ban nicotine-containing products. President George W. Bush has not shown support, but Sen. Cornyn said he'd encourage him to sign it into law if the bill passes the House and Senate.

HEART for Women Reintroduced

The American Heart Association is throwing its weight behind the Heart Disease Education, Analysis and Research, and Treatment (HEART) for Women Act, which was reintroduced in both the House and Senate last month. Sponsored by Sen. Debbie Stabenow (D-Mich.) and Sen. Lisa Murkowski (R-Alaska), the legislation authorizes the Health and Human Services department to provide education to older women and health care professionals on the diagnosis and treatment of women with heart disease, requires gender-specific reporting of heart disease data to the federal government, and expands WISEWOMAN (Well-Integrated Screening and Evaluation for Women Across the Nation), the free heart disease and stroke screening program, beyond its current 14 states. The legislation also is backed by the Society for Women's Health Research, WomenHeart: the National Coalition for Women with Heart Disease, and the Association of Black Cardiologists Inc.

Cardio Tops Drug, Hospital Costs

New data from the Agency for Healthcare Research and Quality show that drugs for cardiovascular disorders are the most costly and that heart disease, stroke, and other circulatory conditions account for one in six hospitalizations. Americans spent $32 billion on drugs for cardiovascular conditions in 2004. The two biggest categories were cardiovascular drugs ($17 billion) and cholesterol-lowering drugs ($10 billion). Although 44% of adults bought a central nervous system drug, compared with 38% buying a cardiovascular drug and 22% a cholesterol cutter, spending for CNS drugs was only $7 billion. Circulatory system diseases put 7 million people in the hospital in 2004. The most common reasons: atherosclerosis (1.2 million stays), congestive heart failure (1.1 million), nonspecific chest pain (846,000), heart attack (695,000), and irregular heart beat (694,000).

FDA's $2 Billion Budget

The Bush administration is requesting $2.1 billion for the FDA in fiscal 2008, a 5% increase from the previous year's request. The agency still has not received its final appropriation for fiscal 2007, so the exact amount it will receive for that year is not known yet. The budget includes $444 million in user fees from industry, including a new program to charge generic drug makers fees to review their products. The agency estimates that generic companies will contribute $16 million in fiscal 2008. In a statement, Generic Pharmaceutical Association CEO Kathleen Jaeger said the decision to seek user fees “will not bring generic medicines to consumers faster as long as brand companies are still permitted to use tactics that delay market entry.” The budget also includes $11 million for improving drug safety (this does not include user fee funds that also will go to that effort) and $7 million to boost medical device safety and to speed up device review. The agency also is requesting $13 million to move about 1,300 employees of the Center for Devices and Radiological Health to offices at the FDA's new White Oak, Md., campus. The FDA gradually has been moving its operations to the new facilities. The Washington-based consumer-, patient- and industry-supported Coalition for a Stronger FDA said the budget did not go far enough. It is seeking at least $175 million more, including greater increases for food, drug, and medical device safety.

Medicare Generic Drug Use Rises

The Centers for Medicare and Medicaid Services says that generic drugs accounted for 60% of the prescriptions dispensed to people who receive benefits through either Part D or Medicare Advantage plans for the first three quarters of 2006. Generic drug use among Part D enrollees is 13% higher than it is for Americans who receive benefits through private payers, said the CMS. The agency said that in 2006, generics accounted for 53% of prescriptions dispensed to privately insured Americans. Greater use of generics will translate into lower costs for the Part D program and possibly expanded coverage for beneficiaries, according to the CMS. “We will continue to promote generics where they are available as an important strategy to keep the new drug benefit affordable over the long term,” CMS Acting Administrator Leslie V. Norwalk said in a statement.

FDA to Regulate Tobacco?

It seemed like back to the future in Washington on Feb. 15, when Sen. Edward M. Kennedy (D-Mass.) presided at a press briefing announcing a proposal that would give the Food and Drug Administration the authority to regulate cigarettes as a drug delivery device. In the mid-1990s, Dr. David Kessler, then FDA commissioner, made a bid to do just that, but lost in a battle that ended at the Supreme Court. Since that time, congressional bids to extend FDA's purview have failed. Sen. Kennedy declared that 2007 is the lucky year. “The likelihood of passage is extremely high,” he said of his bill, which according to cosponsor Sen. John Cornyn (R-Tex.) already has 30 allies, 11 of them Republicans. Rep. Henry Waxman (D-Calif.), introducing the House companion bill, agreed that, “this is the year it will become law,” noting that 100 of his colleagues are ready to sign on. The bill would give FDA more power to restrict tobacco ads and sales to children in particular, require reduction of nicotine levels, and necessitate bigger and more informative warnings on tobacco products. FDA could not ban nicotine-containing products. President George W. Bush has not shown support, but Sen. Cornyn said he'd encourage him to sign it into law if the bill passes the House and Senate.

HEART for Women Reintroduced

The American Heart Association is throwing its weight behind the Heart Disease Education, Analysis and Research, and Treatment (HEART) for Women Act, which was reintroduced in both the House and Senate last month. Sponsored by Sen. Debbie Stabenow (D-Mich.) and Sen. Lisa Murkowski (R-Alaska), the legislation authorizes the Health and Human Services department to provide education to older women and health care professionals on the diagnosis and treatment of women with heart disease, requires gender-specific reporting of heart disease data to the federal government, and expands WISEWOMAN (Well-Integrated Screening and Evaluation for Women Across the Nation), the free heart disease and stroke screening program, beyond its current 14 states. The legislation also is backed by the Society for Women's Health Research, WomenHeart: the National Coalition for Women with Heart Disease, and the Association of Black Cardiologists Inc.

Cardio Tops Drug, Hospital Costs

New data from the Agency for Healthcare Research and Quality show that drugs for cardiovascular disorders are the most costly and that heart disease, stroke, and other circulatory conditions account for one in six hospitalizations. Americans spent $32 billion on drugs for cardiovascular conditions in 2004. The two biggest categories were cardiovascular drugs ($17 billion) and cholesterol-lowering drugs ($10 billion). Although 44% of adults bought a central nervous system drug, compared with 38% buying a cardiovascular drug and 22% a cholesterol cutter, spending for CNS drugs was only $7 billion. Circulatory system diseases put 7 million people in the hospital in 2004. The most common reasons: atherosclerosis (1.2 million stays), congestive heart failure (1.1 million), nonspecific chest pain (846,000), heart attack (695,000), and irregular heart beat (694,000).

FDA's $2 Billion Budget

The Bush administration is requesting $2.1 billion for the FDA in fiscal 2008, a 5% increase from the previous year's request. The agency still has not received its final appropriation for fiscal 2007, so the exact amount it will receive for that year is not known yet. The budget includes $444 million in user fees from industry, including a new program to charge generic drug makers fees to review their products. The agency estimates that generic companies will contribute $16 million in fiscal 2008. In a statement, Generic Pharmaceutical Association CEO Kathleen Jaeger said the decision to seek user fees “will not bring generic medicines to consumers faster as long as brand companies are still permitted to use tactics that delay market entry.” The budget also includes $11 million for improving drug safety (this does not include user fee funds that also will go to that effort) and $7 million to boost medical device safety and to speed up device review. The agency also is requesting $13 million to move about 1,300 employees of the Center for Devices and Radiological Health to offices at the FDA's new White Oak, Md., campus. The FDA gradually has been moving its operations to the new facilities. The Washington-based consumer-, patient- and industry-supported Coalition for a Stronger FDA said the budget did not go far enough. It is seeking at least $175 million more, including greater increases for food, drug, and medical device safety.

Medicare Generic Drug Use Rises

The Centers for Medicare and Medicaid Services says that generic drugs accounted for 60% of the prescriptions dispensed to people who receive benefits through either Part D or Medicare Advantage plans for the first three quarters of 2006. Generic drug use among Part D enrollees is 13% higher than it is for Americans who receive benefits through private payers, said the CMS. The agency said that in 2006, generics accounted for 53% of prescriptions dispensed to privately insured Americans. Greater use of generics will translate into lower costs for the Part D program and possibly expanded coverage for beneficiaries, according to the CMS. “We will continue to promote generics where they are available as an important strategy to keep the new drug benefit affordable over the long term,” CMS Acting Administrator Leslie V. Norwalk said in a statement.

FDA to Regulate Tobacco at Last?

It seemed like back to the future in Washington on Feb. 15, when Sen. Edward M. Kennedy (D-Mass.) presided at a press briefing to announce a proposal that would give the Food and Drug Administration the authority to regulate cigarettes as a drug delivery device. In the mid-1990s, Dr. David Kessler, then FDA commissioner, made a bid to do just that, but lost in a battle that ended at the Supreme Court. Since that time, congressional bids to extend FDA's purview have failed. Sen. Kennedy declared that 2007 is the lucky year. “The likelihood of passage is extremely high,” he said of his bill, which according to cosponsor Sen. John Cornyn (R-Tex.) already has 30 allies, 11 of them Republicans. Rep. Henry Waxman (D-Calif.), introducing the House companion bill, agreed that “this is the year it will become law,” noting that 100 of his colleagues are ready to sign on. The bill would give FDA more power to restrict tobacco ads and sales to children in particular, require reduction of nicotine levels, and necessitate bigger and more informative warnings on tobacco products. FDA could not ban nicotine-containing products.

Parents Need Help With Safety LATCH

The National Highway Traffic Safety Administration held a summit in early February urging child safety seat and automobile makers, retailers and consumer groups to make it easier for parents to install the seats in vehicles. “Our children are precious and parents and caregivers must have the information they need to properly install their car seats,” said NHTSA Administrator Nicole R. Nason in a statement. In December, a NHTSA survey found that 40% of parents relied on seat belts when installing a car seat, instead of new safety technology, known as Lower Anchors and Tethers for Children (LATCH). The technology is standard in vehicles made since 2002. Only 55% of parents surveyed used the top tether.

Lead Testing Measure Proposed

The National Committee for Quality Assurance is proposing a new quality measure for 2008 that calls for children under age 2 years who are enrolled in Medicaid managed care plans to be tested for exposure to lead. “Lead poisoning can have a devastating impact on child development. Screening is simple and inexpensive. There's no reason for this not to be part of routine well-child care for those at risk,” Dr. Greg Pawlson, NCQA executive vice president, said in a statement. The proposed Health Plan Employer Data and Information Set (HEDIS) measure would be aimed at helping to detect elevated levels of lead exposure among the 310,000 children that are presumed to be at risk for lead poisoning. In addition to the health implications, studies estimate that children with high levels of lead in their blood incur an average of $1,300 in avoidable medical costs, according to NCQA. The final HEDIS standards will be released this summer. In the first year that a HEDIS measure is rolled out, data are collected, reported, and audited, but the results are not publicly reported.

Bill Addresses Custody of Mentally Ill

New federal legislation aims to help parents obtain mental health treatment for their children without losing custody. The bill (H.R. 687/S. 382), which was introduced in both the House and the Senate, would authorize $100 million in family support grants to states that chose to end the practice of forcing parents to relinquish custody of mentally ill children to state agencies to receive mental health services. The legislation was prompted by an April 2003 report from the Government Accountability Office, which found that more than 12,000 children from 19 states were placed in the juvenile justice system to receive mental health treatment in 2001. The grants created by the legislation could be used to improve access to mental health and other family support services or to create statewide care coordination program. “It is simply unconscionable that families are forced to choose between custody of their children and the mental health services they desperately need,” Rep. Jim Ramstad (R-Minn.), one of the sponsors of the legislation, said in a statement.

Katrina's Long-Term Emotional Impact

Mississippi children and families displaced by Hurricane Katrina continue to have emotional problems, according to a report from Columbia University and the Children's Health Fund. The researchers interviewed 576 adults from randomly selected households displaced by the hurricane and found that more than half of the parents reported that at least one child in the family had experienced emotional or behavioral issues following Katrina, but only 29% had sought some form of professional help. The findings mirror the results of a similar survey of Louisiana families released last year by Columbia University and the Children's Health Fund.

FDA to Regulate Tobacco at Last?

It seemed like back to the future in Washington on Feb. 15, when Sen. Edward M. Kennedy (D-Mass.) presided at a press briefing to announce a proposal that would give the Food and Drug Administration the authority to regulate cigarettes as a drug delivery device. In the mid-1990s, Dr. David Kessler, then FDA commissioner, made a bid to do just that, but lost in a battle that ended at the Supreme Court. Since that time, congressional bids to extend FDA's purview have failed. Sen. Kennedy declared that 2007 is the lucky year. “The likelihood of passage is extremely high,” he said of his bill, which according to cosponsor Sen. John Cornyn (R-Tex.) already has 30 allies, 11 of them Republicans. Rep. Henry Waxman (D-Calif.), introducing the House companion bill, agreed that “this is the year it will become law,” noting that 100 of his colleagues are ready to sign on. The bill would give FDA more power to restrict tobacco ads and sales to children in particular, require reduction of nicotine levels, and necessitate bigger and more informative warnings on tobacco products. FDA could not ban nicotine-containing products.

Parents Need Help With Safety LATCH

The National Highway Traffic Safety Administration held a summit in early February urging child safety seat and automobile makers, retailers and consumer groups to make it easier for parents to install the seats in vehicles. “Our children are precious and parents and caregivers must have the information they need to properly install their car seats,” said NHTSA Administrator Nicole R. Nason in a statement. In December, a NHTSA survey found that 40% of parents relied on seat belts when installing a car seat, instead of new safety technology, known as Lower Anchors and Tethers for Children (LATCH). The technology is standard in vehicles made since 2002. Only 55% of parents surveyed used the top tether.

Lead Testing Measure Proposed

The National Committee for Quality Assurance is proposing a new quality measure for 2008 that calls for children under age 2 years who are enrolled in Medicaid managed care plans to be tested for exposure to lead. “Lead poisoning can have a devastating impact on child development. Screening is simple and inexpensive. There's no reason for this not to be part of routine well-child care for those at risk,” Dr. Greg Pawlson, NCQA executive vice president, said in a statement. The proposed Health Plan Employer Data and Information Set (HEDIS) measure would be aimed at helping to detect elevated levels of lead exposure among the 310,000 children that are presumed to be at risk for lead poisoning. In addition to the health implications, studies estimate that children with high levels of lead in their blood incur an average of $1,300 in avoidable medical costs, according to NCQA. The final HEDIS standards will be released this summer. In the first year that a HEDIS measure is rolled out, data are collected, reported, and audited, but the results are not publicly reported.

Bill Addresses Custody of Mentally Ill

New federal legislation aims to help parents obtain mental health treatment for their children without losing custody. The bill (H.R. 687/S. 382), which was introduced in both the House and the Senate, would authorize $100 million in family support grants to states that chose to end the practice of forcing parents to relinquish custody of mentally ill children to state agencies to receive mental health services. The legislation was prompted by an April 2003 report from the Government Accountability Office, which found that more than 12,000 children from 19 states were placed in the juvenile justice system to receive mental health treatment in 2001. The grants created by the legislation could be used to improve access to mental health and other family support services or to create statewide care coordination program. “It is simply unconscionable that families are forced to choose between custody of their children and the mental health services they desperately need,” Rep. Jim Ramstad (R-Minn.), one of the sponsors of the legislation, said in a statement.

Katrina's Long-Term Emotional Impact

Mississippi children and families displaced by Hurricane Katrina continue to have emotional problems, according to a report from Columbia University and the Children's Health Fund. The researchers interviewed 576 adults from randomly selected households displaced by the hurricane and found that more than half of the parents reported that at least one child in the family had experienced emotional or behavioral issues following Katrina, but only 29% had sought some form of professional help. The findings mirror the results of a similar survey of Louisiana families released last year by Columbia University and the Children's Health Fund.

FDA to Regulate Tobacco at Last?

It seemed like back to the future in Washington on Feb. 15, when Sen. Edward M. Kennedy (D-Mass.) presided at a press briefing to announce a proposal that would give the Food and Drug Administration the authority to regulate cigarettes as a drug delivery device. In the mid-1990s, Dr. David Kessler, then FDA commissioner, made a bid to do just that, but lost in a battle that ended at the Supreme Court. Since that time, congressional bids to extend FDA's purview have failed. Sen. Kennedy declared that 2007 is the lucky year. “The likelihood of passage is extremely high,” he said of his bill, which according to cosponsor Sen. John Cornyn (R-Tex.) already has 30 allies, 11 of them Republicans. Rep. Henry Waxman (D-Calif.), introducing the House companion bill, agreed that “this is the year it will become law,” noting that 100 of his colleagues are ready to sign on. The bill would give FDA more power to restrict tobacco ads and sales to children in particular, require reduction of nicotine levels, and necessitate bigger and more informative warnings on tobacco products. FDA could not ban nicotine-containing products.

Parents Need Help With Safety LATCH

The National Highway Traffic Safety Administration held a summit in early February urging child safety seat and automobile makers, retailers and consumer groups to make it easier for parents to install the seats in vehicles. “Our children are precious and parents and caregivers must have the information they need to properly install their car seats,” said NHTSA Administrator Nicole R. Nason in a statement. In December, a NHTSA survey found that 40% of parents relied on seat belts when installing a car seat, instead of new safety technology, known as Lower Anchors and Tethers for Children (LATCH). The technology is standard in vehicles made since 2002. Only 55% of parents surveyed used the top tether.

Lead Testing Measure Proposed

The National Committee for Quality Assurance is proposing a new quality measure for 2008 that calls for children under age 2 years who are enrolled in Medicaid managed care plans to be tested for exposure to lead. “Lead poisoning can have a devastating impact on child development. Screening is simple and inexpensive. There's no reason for this not to be part of routine well-child care for those at risk,” Dr. Greg Pawlson, NCQA executive vice president, said in a statement. The proposed Health Plan Employer Data and Information Set (HEDIS) measure would be aimed at helping to detect elevated levels of lead exposure among the 310,000 children that are presumed to be at risk for lead poisoning. In addition to the health implications, studies estimate that children with high levels of lead in their blood incur an average of $1,300 in avoidable medical costs, according to NCQA. The final HEDIS standards will be released this summer. In the first year that a HEDIS measure is rolled out, data are collected, reported, and audited, but the results are not publicly reported.

Bill Addresses Custody of Mentally Ill

New federal legislation aims to help parents obtain mental health treatment for their children without losing custody. The bill (H.R. 687/S. 382), which was introduced in both the House and the Senate, would authorize $100 million in family support grants to states that chose to end the practice of forcing parents to relinquish custody of mentally ill children to state agencies to receive mental health services. The legislation was prompted by an April 2003 report from the Government Accountability Office, which found that more than 12,000 children from 19 states were placed in the juvenile justice system to receive mental health treatment in 2001. The grants created by the legislation could be used to improve access to mental health and other family support services or to create statewide care coordination program. “It is simply unconscionable that families are forced to choose between custody of their children and the mental health services they desperately need,” Rep. Jim Ramstad (R-Minn.), one of the sponsors of the legislation, said in a statement.

Katrina's Long-Term Emotional Impact

Mississippi children and families displaced by Hurricane Katrina continue to have emotional problems, according to a report from Columbia University and the Children's Health Fund. The researchers interviewed 576 adults from randomly selected households displaced by the hurricane and found that more than half of the parents reported that at least one child in the family had experienced emotional or behavioral issues following Katrina, but only 29% had sought some form of professional help. The findings mirror the results of a similar survey of Louisiana families released last year by Columbia University and the Children's Health Fund.

WASHINGTON — As a Senate panel opened debate on reauthorization of the State Children's Health Insurance Program, legislators had doubts about expanding coverage to an estimated 9 million children who are eligible but who have not yet been enrolled.

SCHIP is due to expire on Sept. 30, but most states have been straining in the last few years to pay for children already covered by the program, several witnesses said at a meeting of the Senate Finance Committee. Members of the committee also acknowledged that reality.

“Congress has simply not given [SCHIP] enough funds to meet the current demand for services,” said committee chair Max Baucus (D-Mont.), who estimated that the program would need $12 billion-$15 billion over the next 5 years to maintain current coverage and $45 billion to bring all eligible children into SCHIP.

A last-minute deal signed into law at the end of 2006 allocated $271 million to cover anticipated shortfalls for a dozen or so states, but at least 14 more states will run out of SCHIP funds for fiscal 2007 if Congress does not enact another bailout by mid-May, said Sen. Baucus.

In 2007, states will spend an estimated $6.3 billion on SCHIP, but only $5 billion has been allotted, said Cindy Mann, executive director of the Georgetown University Center for Children and Families, Washington. Without an influx of federal cash, 37 states will run out of funds this year, Ms. Mann testified to the Finance Committee.

As of fiscal 2005, SCHIP had 6 million enrollees, according to a Government Accountability Office (GAO) report released at the Finance Committee hearing. Enrollment grew fastest during the early years of the program and leveled off more recently.

Georgia Gov. Sonny Perdue testified that there has been no slowing of enrollment in his state, with an average 19% per month increase since June 2005. About 273,000 children are covered in Georgia, making it the fourth-largest SCHIP program in the country, he said. The Centers for Medicare and Medicaid Services had projected that only 130,000 children were eligible in Georgia, he said.

But, because of SCHIP rules, states that cover more children end up receiving a smaller allotment for the following year. “The successful implementation of SCHIP in any state automatically undermines maintaining funding to keep these kids enrolled in the program,” Gov. Perdue testified, arguing for a change in the SCHIP funding formula.

Some senators questioned whether states' flexibility should be reined in, saying that some initiatives might be diluting the program's intent—to cover low-income children. Generally, federal law allows states to cover children in families with incomes up to 200% of the poverty level or 50 percentage points above the Medicaid eligibility standard as of 1997. According to the GAO report, seven states were covering families with incomes at 300% of the poverty level or higher. Thirty-nine states require some cost sharing by families, but 11 states charge no premiums or copayments.

Fifteen states cover adults—generally parents of Medicaid- or SCHIP-eligible children, pregnant women, or childless adults. The Health and Human Services department has granted waivers for those states, said Kathryn G. Allen, director of health care at the GAO.

Sen. Charles Grassley (R-Iowa), ranking minority member of the Finance Committee, said he was interested in giving states more flexibility but was not happy about extending coverage to adults.

“The issue is whether SCHIP funds used to cover adults has drained resources targeted by Congress for kids,” said Sen. Grassley. “The 'C' stands for children. There is no 'A' in SCHIP.”

Sen. Orrin Hatch (R-Utah) also questioned how states had been allowed to extend SCHIP benefits to adults. “We have to question whether these waivers have been properly approved,” said Sen. Hatch.

WASHINGTON — As a Senate panel opened debate on reauthorization of the State Children's Health Insurance Program, legislators had doubts about expanding coverage to an estimated 9 million children who are eligible but who have not yet been enrolled.

SCHIP is due to expire on Sept. 30, but most states have been straining in the last few years to pay for children already covered by the program, several witnesses said at a meeting of the Senate Finance Committee. Members of the committee also acknowledged that reality.

“Congress has simply not given [SCHIP] enough funds to meet the current demand for services,” said committee chair Max Baucus (D-Mont.), who estimated that the program would need $12 billion-$15 billion over the next 5 years to maintain current coverage and $45 billion to bring all eligible children into SCHIP.

A last-minute deal signed into law at the end of 2006 allocated $271 million to cover anticipated shortfalls for a dozen or so states, but at least 14 more states will run out of SCHIP funds for fiscal 2007 if Congress does not enact another bailout by mid-May, said Sen. Baucus.

In 2007, states will spend an estimated $6.3 billion on SCHIP, but only $5 billion has been allotted, said Cindy Mann, executive director of the Georgetown University Center for Children and Families, Washington. Without an influx of federal cash, 37 states will run out of funds this year, Ms. Mann testified to the Finance Committee.

As of fiscal 2005, SCHIP had 6 million enrollees, according to a Government Accountability Office (GAO) report released at the Finance Committee hearing. Enrollment grew fastest during the early years of the program and leveled off more recently.

Georgia Gov. Sonny Perdue testified that there has been no slowing of enrollment in his state, with an average 19% per month increase since June 2005. About 273,000 children are covered in Georgia, making it the fourth-largest SCHIP program in the country, he said. The Centers for Medicare and Medicaid Services had projected that only 130,000 children were eligible in Georgia, he said.

But, because of SCHIP rules, states that cover more children end up receiving a smaller allotment for the following year. “The successful implementation of SCHIP in any state automatically undermines maintaining funding to keep these kids enrolled in the program,” Gov. Perdue testified, arguing for a change in the SCHIP funding formula.

Some senators questioned whether states' flexibility should be reined in, saying that some initiatives might be diluting the program's intent—to cover low-income children. Generally, federal law allows states to cover children in families with incomes up to 200% of the poverty level or 50 percentage points above the Medicaid eligibility standard as of 1997. According to the GAO report, seven states were covering families with incomes at 300% of the poverty level or higher. Thirty-nine states require some cost sharing by families, but 11 states charge no premiums or copayments.

Fifteen states cover adults—generally parents of Medicaid- or SCHIP-eligible children, pregnant women, or childless adults. The Health and Human Services department has granted waivers for those states, said Kathryn G. Allen, director of health care at the GAO.

Sen. Charles Grassley (R-Iowa), ranking minority member of the Finance Committee, said he was interested in giving states more flexibility but was not happy about extending coverage to adults.

“The issue is whether SCHIP funds used to cover adults has drained resources targeted by Congress for kids,” said Sen. Grassley. “The 'C' stands for children. There is no 'A' in SCHIP.”

Sen. Orrin Hatch (R-Utah) also questioned how states had been allowed to extend SCHIP benefits to adults. “We have to question whether these waivers have been properly approved,” said Sen. Hatch.

WASHINGTON — As a Senate panel opened debate on reauthorization of the State Children's Health Insurance Program, legislators had doubts about expanding coverage to an estimated 9 million children who are eligible but who have not yet been enrolled.

SCHIP is due to expire on Sept. 30, but most states have been straining in the last few years to pay for children already covered by the program, several witnesses said at a meeting of the Senate Finance Committee. Members of the committee also acknowledged that reality.

“Congress has simply not given [SCHIP] enough funds to meet the current demand for services,” said committee chair Max Baucus (D-Mont.), who estimated that the program would need $12 billion-$15 billion over the next 5 years to maintain current coverage and $45 billion to bring all eligible children into SCHIP.

A last-minute deal signed into law at the end of 2006 allocated $271 million to cover anticipated shortfalls for a dozen or so states, but at least 14 more states will run out of SCHIP funds for fiscal 2007 if Congress does not enact another bailout by mid-May, said Sen. Baucus.

In 2007, states will spend an estimated $6.3 billion on SCHIP, but only $5 billion has been allotted, said Cindy Mann, executive director of the Georgetown University Center for Children and Families, Washington. Without an influx of federal cash, 37 states will run out of funds this year, Ms. Mann testified to the Finance Committee.

As of fiscal 2005, SCHIP had 6 million enrollees, according to a Government Accountability Office (GAO) report released at the Finance Committee hearing. Enrollment grew fastest during the early years of the program and leveled off more recently.

Georgia Gov. Sonny Perdue testified that there has been no slowing of enrollment in his state, with an average 19% per month increase since June 2005. About 273,000 children are covered in Georgia, making it the fourth-largest SCHIP program in the country, he said. The Centers for Medicare and Medicaid Services had projected that only 130,000 children were eligible in Georgia, he said.

But, because of SCHIP rules, states that cover more children end up receiving a smaller allotment for the following year. “The successful implementation of SCHIP in any state automatically undermines maintaining funding to keep these kids enrolled in the program,” Gov. Perdue testified, arguing for a change in the SCHIP funding formula.

Some senators questioned whether states' flexibility should be reined in, saying that some initiatives might be diluting the program's intent—to cover low-income children. Generally, federal law allows states to cover children in families with incomes up to 200% of the poverty level or 50 percentage points above the Medicaid eligibility standard as of 1997. According to the GAO report, seven states were covering families with incomes at 300% of the poverty level or higher. Thirty-nine states require some cost sharing by families, but 11 states charge no premiums or copayments.

Fifteen states cover adults—generally parents of Medicaid- or SCHIP-eligible children, pregnant women, or childless adults. The Health and Human Services department has granted waivers for those states, said Kathryn G. Allen, director of health care at the GAO.

Sen. Charles Grassley (R-Iowa), ranking minority member of the Finance Committee, said he was interested in giving states more flexibility but was not happy about extending coverage to adults.

“The issue is whether SCHIP funds used to cover adults has drained resources targeted by Congress for kids,” said Sen. Grassley. “The 'C' stands for children. There is no 'A' in SCHIP.”

Sen. Orrin Hatch (R-Utah) also questioned how states had been allowed to extend SCHIP benefits to adults. “We have to question whether these waivers have been properly approved,” said Sen. Hatch.