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Sweeping reductions to documentation included in Medicare fee schedule proposal
Doctors could spend less time with their EHRs under Medicare’s proposed physician fee schedule for 2019.
The sweeping proposal also would improve Medicare telemedicine opportunities and update portions of the Quality Payment Program and the Medicare Shared Savings Program, according to documents posted online July 12. There would also be more opportunities to be paid for telemedicine services under the proposed rule, released by the Centers for Medicare & Medicaid Services online July 12 and scheduled for publication July 27 in the Federal Register.
“We are streamlining the system of office E&M codes and reducing the requirements for documentation,” CMS Administrator Seema Verma said during a July 12 press conference.
The proposal would condense all four levels of E&M coding to one level, with one payment – there would no longer be higher payments provided for high levels.
While the change could reduce payments to specialists who generally bill only at the highest level for E&M visits, that difference should be made up in the additional time physicians should have to see patients, according to a fact sheet on the proposed physician fee schedule.
“We estimate that this proposal would save approximately 51 hours of clinic time per clinician per year,” Ms. Verma said, or an additional 500 years of time available for patient care across the system.
The proposed schedule also would expand the list of services that qualify for telemedicine payments and would add payments for virtual check-ins via phone or other communication technologies such as Skype, paying clinicians for time spent reviewing patient photos submitted via text or e-mail.
More time savings could come from proposed reductions to the documentation required to qualify for bonus payments under the Merit-based Incentive Payment System (MIPS) track of the Quality Payment Program.
CMS proposes to remove 34 process measures that are considered to be low-value or low-priority, Ms. Verma said, noting that most physicians are doing these measures but seeing no meaningful difference in the performance that would differentiate payment under the program.
The proposed update continues on with the MyHealthEData initiative by supporting greater patient access to their individual health records. Ms. Verma said that the agency will “reward providers that offer interoperability and provide patients access to their health information.”
While the proposal would not change most of the thresholds for participating MIPS – physicians still would be exempted if they bill Medicare $90,000 or less annually and see 200 or fewer Medicare patients – they also would be exempted if they perform 200 or fewer services under Medicare fee schedule. However, the agency is proposing for the first time to allow physicians to opt-in to the MIPS program if they are prepared to meet the program’s requirements, according to a fact sheet on the proposed changes to QPP.
CMS also is proposing changes to how it pays for new drugs administered in the physician office under Medicare Part B. The proposal would reduce reimbursement for drugs that have not yet been on the market long enough to establish an average sales price from wholesale acquisition cost (WAC) plus 6% to WAC plus 3%, potentially saving money for both patients and Medicare.
The agency also asked for information related to price transparency as part of the proposal. It is looking for perspectives on whether providers and suppliers can and should be required to provide charge and payments information, for health care services and out-of-pocket costs, as well as what data elements would be most useful to consumers to promote price shopping.
Comments on the proposed rule will be accepted at www.regulations.gov until Sept. 10.
Doctors could spend less time with their EHRs under Medicare’s proposed physician fee schedule for 2019.
The sweeping proposal also would improve Medicare telemedicine opportunities and update portions of the Quality Payment Program and the Medicare Shared Savings Program, according to documents posted online July 12. There would also be more opportunities to be paid for telemedicine services under the proposed rule, released by the Centers for Medicare & Medicaid Services online July 12 and scheduled for publication July 27 in the Federal Register.
“We are streamlining the system of office E&M codes and reducing the requirements for documentation,” CMS Administrator Seema Verma said during a July 12 press conference.
The proposal would condense all four levels of E&M coding to one level, with one payment – there would no longer be higher payments provided for high levels.
While the change could reduce payments to specialists who generally bill only at the highest level for E&M visits, that difference should be made up in the additional time physicians should have to see patients, according to a fact sheet on the proposed physician fee schedule.
“We estimate that this proposal would save approximately 51 hours of clinic time per clinician per year,” Ms. Verma said, or an additional 500 years of time available for patient care across the system.
The proposed schedule also would expand the list of services that qualify for telemedicine payments and would add payments for virtual check-ins via phone or other communication technologies such as Skype, paying clinicians for time spent reviewing patient photos submitted via text or e-mail.
More time savings could come from proposed reductions to the documentation required to qualify for bonus payments under the Merit-based Incentive Payment System (MIPS) track of the Quality Payment Program.
CMS proposes to remove 34 process measures that are considered to be low-value or low-priority, Ms. Verma said, noting that most physicians are doing these measures but seeing no meaningful difference in the performance that would differentiate payment under the program.
The proposed update continues on with the MyHealthEData initiative by supporting greater patient access to their individual health records. Ms. Verma said that the agency will “reward providers that offer interoperability and provide patients access to their health information.”
While the proposal would not change most of the thresholds for participating MIPS – physicians still would be exempted if they bill Medicare $90,000 or less annually and see 200 or fewer Medicare patients – they also would be exempted if they perform 200 or fewer services under Medicare fee schedule. However, the agency is proposing for the first time to allow physicians to opt-in to the MIPS program if they are prepared to meet the program’s requirements, according to a fact sheet on the proposed changes to QPP.
CMS also is proposing changes to how it pays for new drugs administered in the physician office under Medicare Part B. The proposal would reduce reimbursement for drugs that have not yet been on the market long enough to establish an average sales price from wholesale acquisition cost (WAC) plus 6% to WAC plus 3%, potentially saving money for both patients and Medicare.
The agency also asked for information related to price transparency as part of the proposal. It is looking for perspectives on whether providers and suppliers can and should be required to provide charge and payments information, for health care services and out-of-pocket costs, as well as what data elements would be most useful to consumers to promote price shopping.
Comments on the proposed rule will be accepted at www.regulations.gov until Sept. 10.
Doctors could spend less time with their EHRs under Medicare’s proposed physician fee schedule for 2019.
The sweeping proposal also would improve Medicare telemedicine opportunities and update portions of the Quality Payment Program and the Medicare Shared Savings Program, according to documents posted online July 12. There would also be more opportunities to be paid for telemedicine services under the proposed rule, released by the Centers for Medicare & Medicaid Services online July 12 and scheduled for publication July 27 in the Federal Register.
“We are streamlining the system of office E&M codes and reducing the requirements for documentation,” CMS Administrator Seema Verma said during a July 12 press conference.
The proposal would condense all four levels of E&M coding to one level, with one payment – there would no longer be higher payments provided for high levels.
While the change could reduce payments to specialists who generally bill only at the highest level for E&M visits, that difference should be made up in the additional time physicians should have to see patients, according to a fact sheet on the proposed physician fee schedule.
“We estimate that this proposal would save approximately 51 hours of clinic time per clinician per year,” Ms. Verma said, or an additional 500 years of time available for patient care across the system.
The proposed schedule also would expand the list of services that qualify for telemedicine payments and would add payments for virtual check-ins via phone or other communication technologies such as Skype, paying clinicians for time spent reviewing patient photos submitted via text or e-mail.
More time savings could come from proposed reductions to the documentation required to qualify for bonus payments under the Merit-based Incentive Payment System (MIPS) track of the Quality Payment Program.
CMS proposes to remove 34 process measures that are considered to be low-value or low-priority, Ms. Verma said, noting that most physicians are doing these measures but seeing no meaningful difference in the performance that would differentiate payment under the program.
The proposed update continues on with the MyHealthEData initiative by supporting greater patient access to their individual health records. Ms. Verma said that the agency will “reward providers that offer interoperability and provide patients access to their health information.”
While the proposal would not change most of the thresholds for participating MIPS – physicians still would be exempted if they bill Medicare $90,000 or less annually and see 200 or fewer Medicare patients – they also would be exempted if they perform 200 or fewer services under Medicare fee schedule. However, the agency is proposing for the first time to allow physicians to opt-in to the MIPS program if they are prepared to meet the program’s requirements, according to a fact sheet on the proposed changes to QPP.
CMS also is proposing changes to how it pays for new drugs administered in the physician office under Medicare Part B. The proposal would reduce reimbursement for drugs that have not yet been on the market long enough to establish an average sales price from wholesale acquisition cost (WAC) plus 6% to WAC plus 3%, potentially saving money for both patients and Medicare.
The agency also asked for information related to price transparency as part of the proposal. It is looking for perspectives on whether providers and suppliers can and should be required to provide charge and payments information, for health care services and out-of-pocket costs, as well as what data elements would be most useful to consumers to promote price shopping.
Comments on the proposed rule will be accepted at www.regulations.gov until Sept. 10.
What might Kavanaugh confirmation mean for ACA, abortion access?
In 2011, Judge Kavanaugh wrote a dissenting opinion on Seven-Sky v. Holder, noting that the ACA’s individual mandate was in fact a tax and that the court could not hear questions about the law’s constitutionality because the tax had not been levied.
That dissenting opinion could become germane in the currently debated Texas v. Azar, which looks destined to reach the high court.
In Texas v. Azar, the Department of Justice has refused to defend the ACA and is siding with Texas and 19 other states. Texas and 19 other states in the case contend that the penalty for not carrying health insurance under the individual mandate is a tax; however, since the penalty was reduced to zero by the Tax Cuts and Jobs Act of 2017, the plaintiffs argue that the individual mandate is unconstitutional. They further contend that the ACA provisions of guaranteed issue and community rating are inseverable and should be eliminated as well.
If confirmed, Judge Kavanaugh’s views that the penalty for the individual mandate is in fact a tax could shift the Supreme Court’s majority view, further putting the law in jeopardy.
Judge Kavanaugh currently serves on the U.S. Court of Appeals for the District of Columbia Circuit, he was appointed by President George W. Bush and has held the position since May 30, 2006. He previously served as White House staff secretary for nearly 3 years.
As an attorney, he had a lead role in drafting the Starr Report, which recommended impeachment of President Bill Clinton.
Judge Kavanaugh will face a contentious confirmation process. In addition to health care, abortion rights will be front and center to the debate as moderate Republican senators who are proponents of abortion rights may not support his nomination. The GOP currently holds a slim 51-49 majority in the Senate, but with the medical absence of Sen. John McCain (R-Ariz.), the majority party may only have 50 members present to vote, meaning only one GOP vote against Judge Kavanaugh could deny his confirmation.
Judge Kavanaugh does not have a stated position on Roe v. Wade; however, his dissenting opinion in Garza v. Hargan questioned whether the government should be involved in provisioning abortions for undocumented immigrant minors.
That opinion is a reason Physicians for Reproductive Health have come out against Judge Kavanaugh’s nomination.
“The Trump administration has already enacted numerous policies restricting access to vital reproductive health services, including contraception, abortion, and maternity care, and will continue to chip away at health care access,” Willie Parker, MD, board chair of Physicians for Reproductive Health, said in a statement. “This nominee will harm not only abortion rights, but will imperil other fundamental rights as well.”
Senate Majority Leader Mitch McConnell said in a statement that Judge Kavanaugh “understands that, in the United States of America, judges are not unelected super-legislators whom we select for their personal views or policy preferences. A judge’s duty is to interpret the plain meaning of our laws and our Constitution according to how they are written. Judges need to be unbiased. They need to treat all parties fairly. They need to approach every case with open ears and an open mind. Judges’ decisions must turn on the facts of each case and be based on the texts that it is their job to interpret. By all accounts, Judge Kavanaugh is precisely that sort of judge.”
Sen. Susan Collins (R-Maine), thought to be one of the potential swing voters that will determine whether Judge Kavanaugh’s appointment is approved, said in a statement that he “has impressive credentials and extensive experience, having served more than a decade on the D.C. Circuit Court of Appeals. I will conduct a careful, thorough vetting of the President’s nominee to the Supreme Court, as I have done with the five previous Supreme Court Justices whom I have considered. I look forward to Judge Kavanaugh’s public hearing before the Senate Judiciary Committee and to questioning him in a meeting in my office.”
President Trump nominated Judge Kavanaugh to the Supreme Court on July 9 to replace the retiring Justice Anthony Kennedy.
In 2011, Judge Kavanaugh wrote a dissenting opinion on Seven-Sky v. Holder, noting that the ACA’s individual mandate was in fact a tax and that the court could not hear questions about the law’s constitutionality because the tax had not been levied.
That dissenting opinion could become germane in the currently debated Texas v. Azar, which looks destined to reach the high court.
In Texas v. Azar, the Department of Justice has refused to defend the ACA and is siding with Texas and 19 other states. Texas and 19 other states in the case contend that the penalty for not carrying health insurance under the individual mandate is a tax; however, since the penalty was reduced to zero by the Tax Cuts and Jobs Act of 2017, the plaintiffs argue that the individual mandate is unconstitutional. They further contend that the ACA provisions of guaranteed issue and community rating are inseverable and should be eliminated as well.
If confirmed, Judge Kavanaugh’s views that the penalty for the individual mandate is in fact a tax could shift the Supreme Court’s majority view, further putting the law in jeopardy.
Judge Kavanaugh currently serves on the U.S. Court of Appeals for the District of Columbia Circuit, he was appointed by President George W. Bush and has held the position since May 30, 2006. He previously served as White House staff secretary for nearly 3 years.
As an attorney, he had a lead role in drafting the Starr Report, which recommended impeachment of President Bill Clinton.
Judge Kavanaugh will face a contentious confirmation process. In addition to health care, abortion rights will be front and center to the debate as moderate Republican senators who are proponents of abortion rights may not support his nomination. The GOP currently holds a slim 51-49 majority in the Senate, but with the medical absence of Sen. John McCain (R-Ariz.), the majority party may only have 50 members present to vote, meaning only one GOP vote against Judge Kavanaugh could deny his confirmation.
Judge Kavanaugh does not have a stated position on Roe v. Wade; however, his dissenting opinion in Garza v. Hargan questioned whether the government should be involved in provisioning abortions for undocumented immigrant minors.
That opinion is a reason Physicians for Reproductive Health have come out against Judge Kavanaugh’s nomination.
“The Trump administration has already enacted numerous policies restricting access to vital reproductive health services, including contraception, abortion, and maternity care, and will continue to chip away at health care access,” Willie Parker, MD, board chair of Physicians for Reproductive Health, said in a statement. “This nominee will harm not only abortion rights, but will imperil other fundamental rights as well.”
Senate Majority Leader Mitch McConnell said in a statement that Judge Kavanaugh “understands that, in the United States of America, judges are not unelected super-legislators whom we select for their personal views or policy preferences. A judge’s duty is to interpret the plain meaning of our laws and our Constitution according to how they are written. Judges need to be unbiased. They need to treat all parties fairly. They need to approach every case with open ears and an open mind. Judges’ decisions must turn on the facts of each case and be based on the texts that it is their job to interpret. By all accounts, Judge Kavanaugh is precisely that sort of judge.”
Sen. Susan Collins (R-Maine), thought to be one of the potential swing voters that will determine whether Judge Kavanaugh’s appointment is approved, said in a statement that he “has impressive credentials and extensive experience, having served more than a decade on the D.C. Circuit Court of Appeals. I will conduct a careful, thorough vetting of the President’s nominee to the Supreme Court, as I have done with the five previous Supreme Court Justices whom I have considered. I look forward to Judge Kavanaugh’s public hearing before the Senate Judiciary Committee and to questioning him in a meeting in my office.”
President Trump nominated Judge Kavanaugh to the Supreme Court on July 9 to replace the retiring Justice Anthony Kennedy.
In 2011, Judge Kavanaugh wrote a dissenting opinion on Seven-Sky v. Holder, noting that the ACA’s individual mandate was in fact a tax and that the court could not hear questions about the law’s constitutionality because the tax had not been levied.
That dissenting opinion could become germane in the currently debated Texas v. Azar, which looks destined to reach the high court.
In Texas v. Azar, the Department of Justice has refused to defend the ACA and is siding with Texas and 19 other states. Texas and 19 other states in the case contend that the penalty for not carrying health insurance under the individual mandate is a tax; however, since the penalty was reduced to zero by the Tax Cuts and Jobs Act of 2017, the plaintiffs argue that the individual mandate is unconstitutional. They further contend that the ACA provisions of guaranteed issue and community rating are inseverable and should be eliminated as well.
If confirmed, Judge Kavanaugh’s views that the penalty for the individual mandate is in fact a tax could shift the Supreme Court’s majority view, further putting the law in jeopardy.
Judge Kavanaugh currently serves on the U.S. Court of Appeals for the District of Columbia Circuit, he was appointed by President George W. Bush and has held the position since May 30, 2006. He previously served as White House staff secretary for nearly 3 years.
As an attorney, he had a lead role in drafting the Starr Report, which recommended impeachment of President Bill Clinton.
Judge Kavanaugh will face a contentious confirmation process. In addition to health care, abortion rights will be front and center to the debate as moderate Republican senators who are proponents of abortion rights may not support his nomination. The GOP currently holds a slim 51-49 majority in the Senate, but with the medical absence of Sen. John McCain (R-Ariz.), the majority party may only have 50 members present to vote, meaning only one GOP vote against Judge Kavanaugh could deny his confirmation.
Judge Kavanaugh does not have a stated position on Roe v. Wade; however, his dissenting opinion in Garza v. Hargan questioned whether the government should be involved in provisioning abortions for undocumented immigrant minors.
That opinion is a reason Physicians for Reproductive Health have come out against Judge Kavanaugh’s nomination.
“The Trump administration has already enacted numerous policies restricting access to vital reproductive health services, including contraception, abortion, and maternity care, and will continue to chip away at health care access,” Willie Parker, MD, board chair of Physicians for Reproductive Health, said in a statement. “This nominee will harm not only abortion rights, but will imperil other fundamental rights as well.”
Senate Majority Leader Mitch McConnell said in a statement that Judge Kavanaugh “understands that, in the United States of America, judges are not unelected super-legislators whom we select for their personal views or policy preferences. A judge’s duty is to interpret the plain meaning of our laws and our Constitution according to how they are written. Judges need to be unbiased. They need to treat all parties fairly. They need to approach every case with open ears and an open mind. Judges’ decisions must turn on the facts of each case and be based on the texts that it is their job to interpret. By all accounts, Judge Kavanaugh is precisely that sort of judge.”
Sen. Susan Collins (R-Maine), thought to be one of the potential swing voters that will determine whether Judge Kavanaugh’s appointment is approved, said in a statement that he “has impressive credentials and extensive experience, having served more than a decade on the D.C. Circuit Court of Appeals. I will conduct a careful, thorough vetting of the President’s nominee to the Supreme Court, as I have done with the five previous Supreme Court Justices whom I have considered. I look forward to Judge Kavanaugh’s public hearing before the Senate Judiciary Committee and to questioning him in a meeting in my office.”
President Trump nominated Judge Kavanaugh to the Supreme Court on July 9 to replace the retiring Justice Anthony Kennedy.
CMS holds ACA risk adjustment payments following legal ruling
The risk adjustment payment uses statewide average premiums to draw money from health insurance plans within a state that have low levels of high-need patients and funnels that money to plans in that state with high amounts of high-need patients, as a way to minimize adverse selection and to spread risk.
The government was set to make a budget neutral payment of $10.4 billion for the 2017 plan year. But in a rare Saturday announcement, the agency said July 7 that the reason for putting the risk adjustment payments on hold was differing legal opinions on the validity of the payments.
The CMS filed a motion to reconsider following the New Mexico verdict, a hearing of which was held June 21.
“We are disappointed by the court’s recent ruling,” CMS Administrator Seema Verma said in a statement. “As a result of this litigation, billions of dollars in risk adjustment payments are now on hold. CMS has asked the court to reconsider its ruling, and hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets.”
“We are very discouraged by the new market disruption brought about by the decision to freeze risk adjustment payments,” insurance trade group America’s Health Insurance Plans said in a statement. “The decision comes at a critical time when insurance providers are developing premiums for 2019 and states are reviewing rates. ... It will create more market uncertainty and increase premiums for many health plans.”
Likewise, the Blue Cross Blue Shield Association predicted higher premiums if the agency does not make payments.
““Without a quick resolution to this matter, this action will significantly increase 2019 premiums for millions of individuals and small business owners and could result in far fewer health plan choices,” BCBSA said in a statement. “It will undermine Americans’ access to affordable coverage, particularly for those who need medical care the most.”
The action comes as the Department of Justice is choosing not to defend the ACA in court against a lawsuit looking to declare the individual mandate unconstitutional in a case that would also eliminate the guaranteed issue provisions of the Affordable Care Act.
The risk adjustment payment uses statewide average premiums to draw money from health insurance plans within a state that have low levels of high-need patients and funnels that money to plans in that state with high amounts of high-need patients, as a way to minimize adverse selection and to spread risk.
The government was set to make a budget neutral payment of $10.4 billion for the 2017 plan year. But in a rare Saturday announcement, the agency said July 7 that the reason for putting the risk adjustment payments on hold was differing legal opinions on the validity of the payments.
The CMS filed a motion to reconsider following the New Mexico verdict, a hearing of which was held June 21.
“We are disappointed by the court’s recent ruling,” CMS Administrator Seema Verma said in a statement. “As a result of this litigation, billions of dollars in risk adjustment payments are now on hold. CMS has asked the court to reconsider its ruling, and hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets.”
“We are very discouraged by the new market disruption brought about by the decision to freeze risk adjustment payments,” insurance trade group America’s Health Insurance Plans said in a statement. “The decision comes at a critical time when insurance providers are developing premiums for 2019 and states are reviewing rates. ... It will create more market uncertainty and increase premiums for many health plans.”
Likewise, the Blue Cross Blue Shield Association predicted higher premiums if the agency does not make payments.
““Without a quick resolution to this matter, this action will significantly increase 2019 premiums for millions of individuals and small business owners and could result in far fewer health plan choices,” BCBSA said in a statement. “It will undermine Americans’ access to affordable coverage, particularly for those who need medical care the most.”
The action comes as the Department of Justice is choosing not to defend the ACA in court against a lawsuit looking to declare the individual mandate unconstitutional in a case that would also eliminate the guaranteed issue provisions of the Affordable Care Act.
The risk adjustment payment uses statewide average premiums to draw money from health insurance plans within a state that have low levels of high-need patients and funnels that money to plans in that state with high amounts of high-need patients, as a way to minimize adverse selection and to spread risk.
The government was set to make a budget neutral payment of $10.4 billion for the 2017 plan year. But in a rare Saturday announcement, the agency said July 7 that the reason for putting the risk adjustment payments on hold was differing legal opinions on the validity of the payments.
The CMS filed a motion to reconsider following the New Mexico verdict, a hearing of which was held June 21.
“We are disappointed by the court’s recent ruling,” CMS Administrator Seema Verma said in a statement. “As a result of this litigation, billions of dollars in risk adjustment payments are now on hold. CMS has asked the court to reconsider its ruling, and hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets.”
“We are very discouraged by the new market disruption brought about by the decision to freeze risk adjustment payments,” insurance trade group America’s Health Insurance Plans said in a statement. “The decision comes at a critical time when insurance providers are developing premiums for 2019 and states are reviewing rates. ... It will create more market uncertainty and increase premiums for many health plans.”
Likewise, the Blue Cross Blue Shield Association predicted higher premiums if the agency does not make payments.
““Without a quick resolution to this matter, this action will significantly increase 2019 premiums for millions of individuals and small business owners and could result in far fewer health plan choices,” BCBSA said in a statement. “It will undermine Americans’ access to affordable coverage, particularly for those who need medical care the most.”
The action comes as the Department of Justice is choosing not to defend the ACA in court against a lawsuit looking to declare the individual mandate unconstitutional in a case that would also eliminate the guaranteed issue provisions of the Affordable Care Act.
GOP Doctors Caucus seeks lower MIPS threshold
The House GOP Doctors Caucus is pushing officials at the Centers for Medicare & Medicaid to lower the exclusion threshold for participation in the Merit-Based Incentive Payment System (MIPS).
In a letter to CMS Administrator Seema Verma, the lawmakers noted that about 60% of health care providers are excluded from MIPS – one track of the agency’s Quality Payment Program – mostly because of the high participation threshold set by the agency.
Since the program provides incentive payments to doctors by shifting Medicare Part B payments, the low participation is also lowering the payments available for high-level performance.
“The most notable ramification of the current threshold has been lower maximum positive updates on how MIPS ultimately adjusts Part B payments,” the lawmakers wrote. “For example, high performers are estimated to receive an aggregate payment adjustment in 2019 of 1.1% – based on their 2017 performance – even though adjustments of up to 4% are authorized.”
This payment trend “fails to incentivize meaningful participation in MIPS,” they wrote.
The current MIPS threshold excludes any physician or practice that generates $90,000 or less in Part B billing or sees 200 or fewer Medicare patients. The agency had initially set the threshold lower, at $30,000 or less in billing or 100 patients but created a larger exemption based on feedback from many physician groups.
The five members of the House GOP Doctors Caucus who signed on to the letter are Phil Roe (Tenn.), Andy Harris (Md.), Earl “Buddy” Carter (Ga.), Larry Bucshon (Ind.), and Scott DesJarlais (Tenn.).
The House GOP Doctors Caucus is pushing officials at the Centers for Medicare & Medicaid to lower the exclusion threshold for participation in the Merit-Based Incentive Payment System (MIPS).
In a letter to CMS Administrator Seema Verma, the lawmakers noted that about 60% of health care providers are excluded from MIPS – one track of the agency’s Quality Payment Program – mostly because of the high participation threshold set by the agency.
Since the program provides incentive payments to doctors by shifting Medicare Part B payments, the low participation is also lowering the payments available for high-level performance.
“The most notable ramification of the current threshold has been lower maximum positive updates on how MIPS ultimately adjusts Part B payments,” the lawmakers wrote. “For example, high performers are estimated to receive an aggregate payment adjustment in 2019 of 1.1% – based on their 2017 performance – even though adjustments of up to 4% are authorized.”
This payment trend “fails to incentivize meaningful participation in MIPS,” they wrote.
The current MIPS threshold excludes any physician or practice that generates $90,000 or less in Part B billing or sees 200 or fewer Medicare patients. The agency had initially set the threshold lower, at $30,000 or less in billing or 100 patients but created a larger exemption based on feedback from many physician groups.
The five members of the House GOP Doctors Caucus who signed on to the letter are Phil Roe (Tenn.), Andy Harris (Md.), Earl “Buddy” Carter (Ga.), Larry Bucshon (Ind.), and Scott DesJarlais (Tenn.).
The House GOP Doctors Caucus is pushing officials at the Centers for Medicare & Medicaid to lower the exclusion threshold for participation in the Merit-Based Incentive Payment System (MIPS).
In a letter to CMS Administrator Seema Verma, the lawmakers noted that about 60% of health care providers are excluded from MIPS – one track of the agency’s Quality Payment Program – mostly because of the high participation threshold set by the agency.
Since the program provides incentive payments to doctors by shifting Medicare Part B payments, the low participation is also lowering the payments available for high-level performance.
“The most notable ramification of the current threshold has been lower maximum positive updates on how MIPS ultimately adjusts Part B payments,” the lawmakers wrote. “For example, high performers are estimated to receive an aggregate payment adjustment in 2019 of 1.1% – based on their 2017 performance – even though adjustments of up to 4% are authorized.”
This payment trend “fails to incentivize meaningful participation in MIPS,” they wrote.
The current MIPS threshold excludes any physician or practice that generates $90,000 or less in Part B billing or sees 200 or fewer Medicare patients. The agency had initially set the threshold lower, at $30,000 or less in billing or 100 patients but created a larger exemption based on feedback from many physician groups.
The five members of the House GOP Doctors Caucus who signed on to the letter are Phil Roe (Tenn.), Andy Harris (Md.), Earl “Buddy” Carter (Ga.), Larry Bucshon (Ind.), and Scott DesJarlais (Tenn.).
Resident debt burden may cloud professional future
Surgical trainees have a large, potentially unmanageable debt burden and are in need of long-term financial education to help better navigate the growing cost of medical education, according to new research.
“Surgical residents are highly leveraged financially and have minimal financial training,” Sarah E. Tevis, MD, of the University of Texas MD Anderson Cancer Center, Houston, and her colleagues wrote in a study in the Journal of the American College of Surgeons. “This places residents in a volatile financial situation as they complete their training and start accumulating debt liabilities, such as mortgages and child care, in the face of tremendous amounts of educational and other debt liabilities.”
Studies of resident debt load typically account for medical education debt, but not for other debts such as undergraduate loans, consumer debt, and mortgages. Residents’ actual debt burden may be considerably higher than has been reported.
The researchers sent surveys to all surgical residents at the University of Wisconsin, Madison, in 2015, with 105 responding (an 80% response rate). Of those responding, 38% reported having more than $200,000 in educational debt, and 82% had a moderate- or high-risk debt-to-asset ratio.
“We found that surgical residents are dangerously overleveraged, with 70% of residents found to have high debt-to-asset ratios,” Dr. Tevis and her colleagues wrote, with the addition of mortgages and vehicle debt on top of educational debt being the key factors of moving residents into the high-risk debt-to-asset category.
The debt-to-asset ratio was calculated as the sum of student loan debt + nonstudent loan debt + credit card balance + mortgage debt + vehicle debt divided by the value of home and other real estate + value of household vehicles + amount in savings + value of retirement investment. A debt-to-asset ratio of 0.5 to 0.9 was considered moderate risk, with a ratio greater than or equal to 0.9 considered high risk.
The debt-to-income ratio was calculated as the sum of student loan debt + nonstudent loan debt + credit card balance + mortgage debt + vehicle debt divided by total household income. A high-risk ratio defined as being greater than 0.4, the line at which surgical trainees might be restricted from obtaining a traditional mortgage.
Total household income included personal income, domestic partner income, military income, and any income from moonlighting, rental properties, and other sources of revenue. Assets included home and second home purchase prices when applicable, value of vehicles, amount in savings, value of retirement accounts, and value of investments. Contributors to debt included student loan, nonstudent loan, mortgage, vehicle financing, and credit card balances.
Salary data for U.S. residents, which strictly tracked U.S. inflation, was calculated over a 15-year period (2000-2015) using data from the Association of American Medical Colleges for comparison.
In examining debt-to-income, researchers found that “83% of residents have a high-risk debt-to-income ratio [greater than 0.4],” the authors wrote. “We found that the majority of residents were classified in the high financial risk exposure cohort when comprehensive total debt liabilities were considered. In this group of highly leveraged residents, over 80% of residents were dangerously unable to manage regular monthly liabilities with their current level of income.”
No statistically significant association between sex, residency year, residency program, or who manages finances and risk debt-to-asset ratios were found in this study.
The authors noted that, although this study did not look at the psychological impact of significant debt load and lack of training on how to manage finances, these factors have been shown in other studies to correlate with resident burnout and psychological stress.
Bruce A. Harms, MD, FACS, coauthor of the study said in an interview, “We are in an evolving era in surgery and in health care in general and financial resources are being stretched. We don’t know for sure that the rising educational debt and overall debt burden as residents enter their prime years will drive the next generation of physicians to certain career choices. It may even perhaps drive a given fully trained young surgeon away from a practice that is more exposed to an underserved population. Excessive financial debt induced stress may influence a resident’s decision on what they do with their skill set but to what degree is largely unknown.”
Dr. Harms added that residents may assume that when they eventually enter practice, they will have a pathway and the means to deal with educational debt. “They would be correct in that starting salaries are keeping pace with inflation. However, in many instances, they are also entering a time in their lives when they will be taking on additional debt in the form of home mortgage, family, and child care costs. I believe, in most instances, residents are focused almost totally on their residency training and many other financial considerations take a back seat and ‘we’ll deal with our debt problem in the future’ attitude. Residents for the most part don’t have the financial means and resources to deal with debt anyway during the course of their lengthy residency training. The exception would be having a secondary income from a spouse or partner that would allow for a more robust debt-attrition strategy. Also, residents are likely not focused on or considering a strategy for the best return on investment of their time, additional expense, and career delay from their prolonged pathway to becoming a fully trained surgeon.”
The bottom line is that basic financial educational is not included in core surgical training even though most surgical residents would like some degree of financial education. That is the basic problem and shortcoming of existing residency training programs, Dr. Tevis and her colleagues wrote.
Given the financial burdens that education and other factors are placing on surgical residents, Dr. Tevis and her colleagues proposed “that formal training in the business of medicine and personal finance for surgical residents be strongly considered at the training program level or in partnership with other organizations, such as the American College of Surgeons, in an effort to improve the financial status of residents and prepare them for their careers, both personally and professionally.”
Dr. Harms noted, “It is probable that in most cases, educational loan debt principal is not being paid down to any significant degree given the current residency salary structure. We can only hope that residents are given some degree of good information on strategies for managing educational loan debt, which may include federally sponsored loan repayment programs such as [those offered] through NIH-sponsored research or federal loan forgiveness programs that residents may qualify for. In most cases, federal loan forgiveness programs require a minimum monthly payment that is calculated based upon current income. As an absolute minimum, interest payments should be made as additional interest debt will add significantly to the overall debt burden as interest will continue to accrue.”
Getting that financial training early could have significant benefits on the back end. The study authors noted that salary data from the Association of American Medical Colleges showed assistant professor salaries mirrored inflation metrics, but even better, surgeon salaries continued to exceed inflation-indexed targets and continued upward trends even through recession periods.
“Therefore, the financial pathway, built on increases in surgeon starting salaries exceeding annual inflation, presently still exists for deleveraging of critical debt exposure if personal finances are optimally managed,” the authors stated.
The study did have its limitations. It did not include certain variable expenses such as utilities, food, and other shopping habits, although that may have been captured as the survey asked respondents to list other “major” sources of income and debt. It also was limited to surgical residents at a single institution and may not be applicable to other specialties or geographic locations. It did not assess whether residents with mortgage payments were able to make educational loan payments beyond the minimum.
The investigators reported no conflicts.
SOURCE: Tevis SE et al. J Am Coll Surg. 2018 May 31. doi: 10.1016/j.jamcollsurg.2018.05.002.
Surgical trainees have a large, potentially unmanageable debt burden and are in need of long-term financial education to help better navigate the growing cost of medical education, according to new research.
“Surgical residents are highly leveraged financially and have minimal financial training,” Sarah E. Tevis, MD, of the University of Texas MD Anderson Cancer Center, Houston, and her colleagues wrote in a study in the Journal of the American College of Surgeons. “This places residents in a volatile financial situation as they complete their training and start accumulating debt liabilities, such as mortgages and child care, in the face of tremendous amounts of educational and other debt liabilities.”
Studies of resident debt load typically account for medical education debt, but not for other debts such as undergraduate loans, consumer debt, and mortgages. Residents’ actual debt burden may be considerably higher than has been reported.
The researchers sent surveys to all surgical residents at the University of Wisconsin, Madison, in 2015, with 105 responding (an 80% response rate). Of those responding, 38% reported having more than $200,000 in educational debt, and 82% had a moderate- or high-risk debt-to-asset ratio.
“We found that surgical residents are dangerously overleveraged, with 70% of residents found to have high debt-to-asset ratios,” Dr. Tevis and her colleagues wrote, with the addition of mortgages and vehicle debt on top of educational debt being the key factors of moving residents into the high-risk debt-to-asset category.
The debt-to-asset ratio was calculated as the sum of student loan debt + nonstudent loan debt + credit card balance + mortgage debt + vehicle debt divided by the value of home and other real estate + value of household vehicles + amount in savings + value of retirement investment. A debt-to-asset ratio of 0.5 to 0.9 was considered moderate risk, with a ratio greater than or equal to 0.9 considered high risk.
The debt-to-income ratio was calculated as the sum of student loan debt + nonstudent loan debt + credit card balance + mortgage debt + vehicle debt divided by total household income. A high-risk ratio defined as being greater than 0.4, the line at which surgical trainees might be restricted from obtaining a traditional mortgage.
Total household income included personal income, domestic partner income, military income, and any income from moonlighting, rental properties, and other sources of revenue. Assets included home and second home purchase prices when applicable, value of vehicles, amount in savings, value of retirement accounts, and value of investments. Contributors to debt included student loan, nonstudent loan, mortgage, vehicle financing, and credit card balances.
Salary data for U.S. residents, which strictly tracked U.S. inflation, was calculated over a 15-year period (2000-2015) using data from the Association of American Medical Colleges for comparison.
In examining debt-to-income, researchers found that “83% of residents have a high-risk debt-to-income ratio [greater than 0.4],” the authors wrote. “We found that the majority of residents were classified in the high financial risk exposure cohort when comprehensive total debt liabilities were considered. In this group of highly leveraged residents, over 80% of residents were dangerously unable to manage regular monthly liabilities with their current level of income.”
No statistically significant association between sex, residency year, residency program, or who manages finances and risk debt-to-asset ratios were found in this study.
The authors noted that, although this study did not look at the psychological impact of significant debt load and lack of training on how to manage finances, these factors have been shown in other studies to correlate with resident burnout and psychological stress.
Bruce A. Harms, MD, FACS, coauthor of the study said in an interview, “We are in an evolving era in surgery and in health care in general and financial resources are being stretched. We don’t know for sure that the rising educational debt and overall debt burden as residents enter their prime years will drive the next generation of physicians to certain career choices. It may even perhaps drive a given fully trained young surgeon away from a practice that is more exposed to an underserved population. Excessive financial debt induced stress may influence a resident’s decision on what they do with their skill set but to what degree is largely unknown.”
Dr. Harms added that residents may assume that when they eventually enter practice, they will have a pathway and the means to deal with educational debt. “They would be correct in that starting salaries are keeping pace with inflation. However, in many instances, they are also entering a time in their lives when they will be taking on additional debt in the form of home mortgage, family, and child care costs. I believe, in most instances, residents are focused almost totally on their residency training and many other financial considerations take a back seat and ‘we’ll deal with our debt problem in the future’ attitude. Residents for the most part don’t have the financial means and resources to deal with debt anyway during the course of their lengthy residency training. The exception would be having a secondary income from a spouse or partner that would allow for a more robust debt-attrition strategy. Also, residents are likely not focused on or considering a strategy for the best return on investment of their time, additional expense, and career delay from their prolonged pathway to becoming a fully trained surgeon.”
The bottom line is that basic financial educational is not included in core surgical training even though most surgical residents would like some degree of financial education. That is the basic problem and shortcoming of existing residency training programs, Dr. Tevis and her colleagues wrote.
Given the financial burdens that education and other factors are placing on surgical residents, Dr. Tevis and her colleagues proposed “that formal training in the business of medicine and personal finance for surgical residents be strongly considered at the training program level or in partnership with other organizations, such as the American College of Surgeons, in an effort to improve the financial status of residents and prepare them for their careers, both personally and professionally.”
Dr. Harms noted, “It is probable that in most cases, educational loan debt principal is not being paid down to any significant degree given the current residency salary structure. We can only hope that residents are given some degree of good information on strategies for managing educational loan debt, which may include federally sponsored loan repayment programs such as [those offered] through NIH-sponsored research or federal loan forgiveness programs that residents may qualify for. In most cases, federal loan forgiveness programs require a minimum monthly payment that is calculated based upon current income. As an absolute minimum, interest payments should be made as additional interest debt will add significantly to the overall debt burden as interest will continue to accrue.”
Getting that financial training early could have significant benefits on the back end. The study authors noted that salary data from the Association of American Medical Colleges showed assistant professor salaries mirrored inflation metrics, but even better, surgeon salaries continued to exceed inflation-indexed targets and continued upward trends even through recession periods.
“Therefore, the financial pathway, built on increases in surgeon starting salaries exceeding annual inflation, presently still exists for deleveraging of critical debt exposure if personal finances are optimally managed,” the authors stated.
The study did have its limitations. It did not include certain variable expenses such as utilities, food, and other shopping habits, although that may have been captured as the survey asked respondents to list other “major” sources of income and debt. It also was limited to surgical residents at a single institution and may not be applicable to other specialties or geographic locations. It did not assess whether residents with mortgage payments were able to make educational loan payments beyond the minimum.
The investigators reported no conflicts.
SOURCE: Tevis SE et al. J Am Coll Surg. 2018 May 31. doi: 10.1016/j.jamcollsurg.2018.05.002.
Surgical trainees have a large, potentially unmanageable debt burden and are in need of long-term financial education to help better navigate the growing cost of medical education, according to new research.
“Surgical residents are highly leveraged financially and have minimal financial training,” Sarah E. Tevis, MD, of the University of Texas MD Anderson Cancer Center, Houston, and her colleagues wrote in a study in the Journal of the American College of Surgeons. “This places residents in a volatile financial situation as they complete their training and start accumulating debt liabilities, such as mortgages and child care, in the face of tremendous amounts of educational and other debt liabilities.”
Studies of resident debt load typically account for medical education debt, but not for other debts such as undergraduate loans, consumer debt, and mortgages. Residents’ actual debt burden may be considerably higher than has been reported.
The researchers sent surveys to all surgical residents at the University of Wisconsin, Madison, in 2015, with 105 responding (an 80% response rate). Of those responding, 38% reported having more than $200,000 in educational debt, and 82% had a moderate- or high-risk debt-to-asset ratio.
“We found that surgical residents are dangerously overleveraged, with 70% of residents found to have high debt-to-asset ratios,” Dr. Tevis and her colleagues wrote, with the addition of mortgages and vehicle debt on top of educational debt being the key factors of moving residents into the high-risk debt-to-asset category.
The debt-to-asset ratio was calculated as the sum of student loan debt + nonstudent loan debt + credit card balance + mortgage debt + vehicle debt divided by the value of home and other real estate + value of household vehicles + amount in savings + value of retirement investment. A debt-to-asset ratio of 0.5 to 0.9 was considered moderate risk, with a ratio greater than or equal to 0.9 considered high risk.
The debt-to-income ratio was calculated as the sum of student loan debt + nonstudent loan debt + credit card balance + mortgage debt + vehicle debt divided by total household income. A high-risk ratio defined as being greater than 0.4, the line at which surgical trainees might be restricted from obtaining a traditional mortgage.
Total household income included personal income, domestic partner income, military income, and any income from moonlighting, rental properties, and other sources of revenue. Assets included home and second home purchase prices when applicable, value of vehicles, amount in savings, value of retirement accounts, and value of investments. Contributors to debt included student loan, nonstudent loan, mortgage, vehicle financing, and credit card balances.
Salary data for U.S. residents, which strictly tracked U.S. inflation, was calculated over a 15-year period (2000-2015) using data from the Association of American Medical Colleges for comparison.
In examining debt-to-income, researchers found that “83% of residents have a high-risk debt-to-income ratio [greater than 0.4],” the authors wrote. “We found that the majority of residents were classified in the high financial risk exposure cohort when comprehensive total debt liabilities were considered. In this group of highly leveraged residents, over 80% of residents were dangerously unable to manage regular monthly liabilities with their current level of income.”
No statistically significant association between sex, residency year, residency program, or who manages finances and risk debt-to-asset ratios were found in this study.
The authors noted that, although this study did not look at the psychological impact of significant debt load and lack of training on how to manage finances, these factors have been shown in other studies to correlate with resident burnout and psychological stress.
Bruce A. Harms, MD, FACS, coauthor of the study said in an interview, “We are in an evolving era in surgery and in health care in general and financial resources are being stretched. We don’t know for sure that the rising educational debt and overall debt burden as residents enter their prime years will drive the next generation of physicians to certain career choices. It may even perhaps drive a given fully trained young surgeon away from a practice that is more exposed to an underserved population. Excessive financial debt induced stress may influence a resident’s decision on what they do with their skill set but to what degree is largely unknown.”
Dr. Harms added that residents may assume that when they eventually enter practice, they will have a pathway and the means to deal with educational debt. “They would be correct in that starting salaries are keeping pace with inflation. However, in many instances, they are also entering a time in their lives when they will be taking on additional debt in the form of home mortgage, family, and child care costs. I believe, in most instances, residents are focused almost totally on their residency training and many other financial considerations take a back seat and ‘we’ll deal with our debt problem in the future’ attitude. Residents for the most part don’t have the financial means and resources to deal with debt anyway during the course of their lengthy residency training. The exception would be having a secondary income from a spouse or partner that would allow for a more robust debt-attrition strategy. Also, residents are likely not focused on or considering a strategy for the best return on investment of their time, additional expense, and career delay from their prolonged pathway to becoming a fully trained surgeon.”
The bottom line is that basic financial educational is not included in core surgical training even though most surgical residents would like some degree of financial education. That is the basic problem and shortcoming of existing residency training programs, Dr. Tevis and her colleagues wrote.
Given the financial burdens that education and other factors are placing on surgical residents, Dr. Tevis and her colleagues proposed “that formal training in the business of medicine and personal finance for surgical residents be strongly considered at the training program level or in partnership with other organizations, such as the American College of Surgeons, in an effort to improve the financial status of residents and prepare them for their careers, both personally and professionally.”
Dr. Harms noted, “It is probable that in most cases, educational loan debt principal is not being paid down to any significant degree given the current residency salary structure. We can only hope that residents are given some degree of good information on strategies for managing educational loan debt, which may include federally sponsored loan repayment programs such as [those offered] through NIH-sponsored research or federal loan forgiveness programs that residents may qualify for. In most cases, federal loan forgiveness programs require a minimum monthly payment that is calculated based upon current income. As an absolute minimum, interest payments should be made as additional interest debt will add significantly to the overall debt burden as interest will continue to accrue.”
Getting that financial training early could have significant benefits on the back end. The study authors noted that salary data from the Association of American Medical Colleges showed assistant professor salaries mirrored inflation metrics, but even better, surgeon salaries continued to exceed inflation-indexed targets and continued upward trends even through recession periods.
“Therefore, the financial pathway, built on increases in surgeon starting salaries exceeding annual inflation, presently still exists for deleveraging of critical debt exposure if personal finances are optimally managed,” the authors stated.
The study did have its limitations. It did not include certain variable expenses such as utilities, food, and other shopping habits, although that may have been captured as the survey asked respondents to list other “major” sources of income and debt. It also was limited to surgical residents at a single institution and may not be applicable to other specialties or geographic locations. It did not assess whether residents with mortgage payments were able to make educational loan payments beyond the minimum.
The investigators reported no conflicts.
SOURCE: Tevis SE et al. J Am Coll Surg. 2018 May 31. doi: 10.1016/j.jamcollsurg.2018.05.002.
FROM THE JOURNAL OF THE AMERICAN COLLEGE OF SURGEONS
Key clinical point: Residents’ actual debt may be considerably higher than has been reported.
Major finding: More than one-third of surgical residents responding to a survey reported more than $200,000 in educational debt.
Study details: An analysis of responses to a survey from 105 surgical residents at the University of Wisconsin.
Disclosures: The study authors reported no disclosures.
Source: Tevis SE et al. J Am Coll Surg. 2018 May 31. doi: 10.1016/j.jamcollsurg.2018.05.002.
Major PHS Cuts Proposed in Reorg Plan
The Trump administration seeks to reorganize several federal agencies as part of a sweeping reform proposal, issued June 21. Although the plans hits many parts of federal health care, the most dramatic change is a proposed reduction of the Public Health Service (PHS) Commissioned Corps from more than 6,000 officers to no more than 4,500.
“Government in the 21st century is fundamentally a services business, and modern information technology should be at the heart of the U.S. government service delivery model,” according to the administration’s reform proposal. “And yet, today’s Executive branch is still aligned to the stove-piped organizational constructs of the 20th century, which in many cases have grown inefficient and out of date. Consequently, the public and our workforce are frustrated with government’s ability to deliver its mission in an effective, efficient, and secure way.”
If implemented, changes to the Commissioned Corp would be dramatic. The plan directs the Department of Health and Human Services (HHS) to “civilianize officers who do not provide critical public health services” and to ensure that the Corps is deployed at least once every 3 years to positions that either are difficult to fill or respond to a public health emergency. Instead the Commissioned Corps would be replaced with a Reserve Corps. Similar to the armed forces reserves, this group “would consist of Government employees and private citizens who agree to be deployed and serve in times of national need.” In addition, the plan would change the way federal agencies pay for the retirement benefits of Commissioned Corps members, potentially eliminating one of the fiscal benefits that agencies receive for hiring Commissioned Corps members.
In addition, under the proposal, nutrition assistance programs currently run out of the U.S. Department of Agriculture (USDA) including the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) would move to the Department of Health and Human Services, which would be rebranded the Department of Health and Public Welfare.
Moving these programs “would allow for better and easier coordination across programs that serve similar populations, ensuring consistent policies and a single point of administration for the major public assistance programs,” according to the proposal. “This single point of administration would lead to reduced duplication in state reporting requirements and other administrative burdens, and a more streamlined process for issuing guidance, writing regulations, and approving waivers.”
Food oversight functions would move from the Food and Drug Administration to the USDA; FDA would be rebranded the Federal Drug Administration and focus on drugs, devices, biologics, tobacco, dietary supplements, and cosmetics.
The administration also proposed to create a Council on Public Assistance comprised of “all federal agencies that administer public benefits, with a statutory authority to set cross-cutting program policies, including uniform work requirements.”
Other functions of the council would include approving service plans and waivers by states under Welfare-to-Work projects; resolving disputes when multiple agencies disagree on a particular policy; and recommending policy changes to eliminate barriers at the federal, state, and local level to getting welfare beneficiaries to work.
The proposal also calls for a restructuring of the National Institutes of Health “to ensure operations are effective and efficient,” with no detail provided. It would also place the Agency for Healthcare Research and Quality under the auspices of NIH.
The Strategic National Stockpile would be managed by the Assistant Secretary for Preparedness and Response “to consolidate strategic decision making around the development and procurement of medical countermeasures, and streamline operational decisions during responses to public health and other emergencies to improve responsiveness.”
Senator Patty Murray (D-WA), the ranking member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, was quick to dismiss the plan, labeling it as “futile” and an “attempt to make government work worse for the people it serves.”
This article originally appeared at Internal Medicine News. It has been edited for Federal Practitioner and includes additional reporting by Reid Paul.
The Trump administration seeks to reorganize several federal agencies as part of a sweeping reform proposal, issued June 21. Although the plans hits many parts of federal health care, the most dramatic change is a proposed reduction of the Public Health Service (PHS) Commissioned Corps from more than 6,000 officers to no more than 4,500.
“Government in the 21st century is fundamentally a services business, and modern information technology should be at the heart of the U.S. government service delivery model,” according to the administration’s reform proposal. “And yet, today’s Executive branch is still aligned to the stove-piped organizational constructs of the 20th century, which in many cases have grown inefficient and out of date. Consequently, the public and our workforce are frustrated with government’s ability to deliver its mission in an effective, efficient, and secure way.”
If implemented, changes to the Commissioned Corp would be dramatic. The plan directs the Department of Health and Human Services (HHS) to “civilianize officers who do not provide critical public health services” and to ensure that the Corps is deployed at least once every 3 years to positions that either are difficult to fill or respond to a public health emergency. Instead the Commissioned Corps would be replaced with a Reserve Corps. Similar to the armed forces reserves, this group “would consist of Government employees and private citizens who agree to be deployed and serve in times of national need.” In addition, the plan would change the way federal agencies pay for the retirement benefits of Commissioned Corps members, potentially eliminating one of the fiscal benefits that agencies receive for hiring Commissioned Corps members.
In addition, under the proposal, nutrition assistance programs currently run out of the U.S. Department of Agriculture (USDA) including the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) would move to the Department of Health and Human Services, which would be rebranded the Department of Health and Public Welfare.
Moving these programs “would allow for better and easier coordination across programs that serve similar populations, ensuring consistent policies and a single point of administration for the major public assistance programs,” according to the proposal. “This single point of administration would lead to reduced duplication in state reporting requirements and other administrative burdens, and a more streamlined process for issuing guidance, writing regulations, and approving waivers.”
Food oversight functions would move from the Food and Drug Administration to the USDA; FDA would be rebranded the Federal Drug Administration and focus on drugs, devices, biologics, tobacco, dietary supplements, and cosmetics.
The administration also proposed to create a Council on Public Assistance comprised of “all federal agencies that administer public benefits, with a statutory authority to set cross-cutting program policies, including uniform work requirements.”
Other functions of the council would include approving service plans and waivers by states under Welfare-to-Work projects; resolving disputes when multiple agencies disagree on a particular policy; and recommending policy changes to eliminate barriers at the federal, state, and local level to getting welfare beneficiaries to work.
The proposal also calls for a restructuring of the National Institutes of Health “to ensure operations are effective and efficient,” with no detail provided. It would also place the Agency for Healthcare Research and Quality under the auspices of NIH.
The Strategic National Stockpile would be managed by the Assistant Secretary for Preparedness and Response “to consolidate strategic decision making around the development and procurement of medical countermeasures, and streamline operational decisions during responses to public health and other emergencies to improve responsiveness.”
Senator Patty Murray (D-WA), the ranking member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, was quick to dismiss the plan, labeling it as “futile” and an “attempt to make government work worse for the people it serves.”
This article originally appeared at Internal Medicine News. It has been edited for Federal Practitioner and includes additional reporting by Reid Paul.
The Trump administration seeks to reorganize several federal agencies as part of a sweeping reform proposal, issued June 21. Although the plans hits many parts of federal health care, the most dramatic change is a proposed reduction of the Public Health Service (PHS) Commissioned Corps from more than 6,000 officers to no more than 4,500.
“Government in the 21st century is fundamentally a services business, and modern information technology should be at the heart of the U.S. government service delivery model,” according to the administration’s reform proposal. “And yet, today’s Executive branch is still aligned to the stove-piped organizational constructs of the 20th century, which in many cases have grown inefficient and out of date. Consequently, the public and our workforce are frustrated with government’s ability to deliver its mission in an effective, efficient, and secure way.”
If implemented, changes to the Commissioned Corp would be dramatic. The plan directs the Department of Health and Human Services (HHS) to “civilianize officers who do not provide critical public health services” and to ensure that the Corps is deployed at least once every 3 years to positions that either are difficult to fill or respond to a public health emergency. Instead the Commissioned Corps would be replaced with a Reserve Corps. Similar to the armed forces reserves, this group “would consist of Government employees and private citizens who agree to be deployed and serve in times of national need.” In addition, the plan would change the way federal agencies pay for the retirement benefits of Commissioned Corps members, potentially eliminating one of the fiscal benefits that agencies receive for hiring Commissioned Corps members.
In addition, under the proposal, nutrition assistance programs currently run out of the U.S. Department of Agriculture (USDA) including the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) would move to the Department of Health and Human Services, which would be rebranded the Department of Health and Public Welfare.
Moving these programs “would allow for better and easier coordination across programs that serve similar populations, ensuring consistent policies and a single point of administration for the major public assistance programs,” according to the proposal. “This single point of administration would lead to reduced duplication in state reporting requirements and other administrative burdens, and a more streamlined process for issuing guidance, writing regulations, and approving waivers.”
Food oversight functions would move from the Food and Drug Administration to the USDA; FDA would be rebranded the Federal Drug Administration and focus on drugs, devices, biologics, tobacco, dietary supplements, and cosmetics.
The administration also proposed to create a Council on Public Assistance comprised of “all federal agencies that administer public benefits, with a statutory authority to set cross-cutting program policies, including uniform work requirements.”
Other functions of the council would include approving service plans and waivers by states under Welfare-to-Work projects; resolving disputes when multiple agencies disagree on a particular policy; and recommending policy changes to eliminate barriers at the federal, state, and local level to getting welfare beneficiaries to work.
The proposal also calls for a restructuring of the National Institutes of Health “to ensure operations are effective and efficient,” with no detail provided. It would also place the Agency for Healthcare Research and Quality under the auspices of NIH.
The Strategic National Stockpile would be managed by the Assistant Secretary for Preparedness and Response “to consolidate strategic decision making around the development and procurement of medical countermeasures, and streamline operational decisions during responses to public health and other emergencies to improve responsiveness.”
Senator Patty Murray (D-WA), the ranking member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, was quick to dismiss the plan, labeling it as “futile” and an “attempt to make government work worse for the people it serves.”
This article originally appeared at Internal Medicine News. It has been edited for Federal Practitioner and includes additional reporting by Reid Paul.
Trump administration proposes changes to HHS, FDA
The Trump administration seeks to reorganize several federal agencies as part of a sweeping reform proposal, issued June 21.
“Government in the 21st century is fundamentally a services business, and modern information technology should be at the heart of the U.S. government service delivery model,” according to the administration’s reform proposal. “And yet, today’s Executive branch is still aligned to the stove-piped organizational constructs of the 20th century, which in many cases have grown inefficient and out of date. Consequently, the public and our workforce are frustrated with government’s ability to deliver its mission in an effective, efficient, and secure way.”
Under the proposal, nutrition assistance programs currently run out of the U.S. Department of Agriculture (USDA) including the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) would move to the Department of Health and Human Services, which would be rebranded the Department of Health and Public Welfare.
Moving these programs “would allow for better and easier coordination across programs that serve similar populations, ensuring consistent policies and a single point of administration for the major public assistance programs,” according to the proposal. “This single point of administration would lead to reduced duplication in state reporting requirements and other administrative burdens, and a more streamlined process for issuing guidance, writing regulations, and approving waivers.”
Food oversight functions would move from the Food and Drug Administration to the USDA; FDA would be rebranded the Federal Drug Administration and focus on drugs, devices, biologics, tobacco, dietary supplements, and cosmetics.
The administration also proposed to created a Council on Public Assistance comprised of “all federal agencies that administer public benefits, with a statutory authority to set cross-cutting program policies, including uniform work requirements.”
Other functions of the council would include approving service plans and waivers by states under Welfare-to-Work projects; resolving disputes when multiple agencies disagree on a particular policy; and recommending policy changes to eliminate barriers at the federal, state, and local level to getting welfare beneficiaries to work.
The proposal also calls for a restructuring of the National Institutes of Health “to ensure operations are effective and efficient,” with no detail provided. It would also place the Agency for Healthcare Research and Quality under the auspices of NIH.
The Strategic National Stockpile would be managed by the Assistant Secretary for Preparedness and Response “to consolidate strategic decision making around the development and procurement of medical countermeasures, and streamline operational decisions during responses to public health and other emergencies to improve responsiveness.”
The Trump administration seeks to reorganize several federal agencies as part of a sweeping reform proposal, issued June 21.
“Government in the 21st century is fundamentally a services business, and modern information technology should be at the heart of the U.S. government service delivery model,” according to the administration’s reform proposal. “And yet, today’s Executive branch is still aligned to the stove-piped organizational constructs of the 20th century, which in many cases have grown inefficient and out of date. Consequently, the public and our workforce are frustrated with government’s ability to deliver its mission in an effective, efficient, and secure way.”
Under the proposal, nutrition assistance programs currently run out of the U.S. Department of Agriculture (USDA) including the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) would move to the Department of Health and Human Services, which would be rebranded the Department of Health and Public Welfare.
Moving these programs “would allow for better and easier coordination across programs that serve similar populations, ensuring consistent policies and a single point of administration for the major public assistance programs,” according to the proposal. “This single point of administration would lead to reduced duplication in state reporting requirements and other administrative burdens, and a more streamlined process for issuing guidance, writing regulations, and approving waivers.”
Food oversight functions would move from the Food and Drug Administration to the USDA; FDA would be rebranded the Federal Drug Administration and focus on drugs, devices, biologics, tobacco, dietary supplements, and cosmetics.
The administration also proposed to created a Council on Public Assistance comprised of “all federal agencies that administer public benefits, with a statutory authority to set cross-cutting program policies, including uniform work requirements.”
Other functions of the council would include approving service plans and waivers by states under Welfare-to-Work projects; resolving disputes when multiple agencies disagree on a particular policy; and recommending policy changes to eliminate barriers at the federal, state, and local level to getting welfare beneficiaries to work.
The proposal also calls for a restructuring of the National Institutes of Health “to ensure operations are effective and efficient,” with no detail provided. It would also place the Agency for Healthcare Research and Quality under the auspices of NIH.
The Strategic National Stockpile would be managed by the Assistant Secretary for Preparedness and Response “to consolidate strategic decision making around the development and procurement of medical countermeasures, and streamline operational decisions during responses to public health and other emergencies to improve responsiveness.”
The Trump administration seeks to reorganize several federal agencies as part of a sweeping reform proposal, issued June 21.
“Government in the 21st century is fundamentally a services business, and modern information technology should be at the heart of the U.S. government service delivery model,” according to the administration’s reform proposal. “And yet, today’s Executive branch is still aligned to the stove-piped organizational constructs of the 20th century, which in many cases have grown inefficient and out of date. Consequently, the public and our workforce are frustrated with government’s ability to deliver its mission in an effective, efficient, and secure way.”
Under the proposal, nutrition assistance programs currently run out of the U.S. Department of Agriculture (USDA) including the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) would move to the Department of Health and Human Services, which would be rebranded the Department of Health and Public Welfare.
Moving these programs “would allow for better and easier coordination across programs that serve similar populations, ensuring consistent policies and a single point of administration for the major public assistance programs,” according to the proposal. “This single point of administration would lead to reduced duplication in state reporting requirements and other administrative burdens, and a more streamlined process for issuing guidance, writing regulations, and approving waivers.”
Food oversight functions would move from the Food and Drug Administration to the USDA; FDA would be rebranded the Federal Drug Administration and focus on drugs, devices, biologics, tobacco, dietary supplements, and cosmetics.
The administration also proposed to created a Council on Public Assistance comprised of “all federal agencies that administer public benefits, with a statutory authority to set cross-cutting program policies, including uniform work requirements.”
Other functions of the council would include approving service plans and waivers by states under Welfare-to-Work projects; resolving disputes when multiple agencies disagree on a particular policy; and recommending policy changes to eliminate barriers at the federal, state, and local level to getting welfare beneficiaries to work.
The proposal also calls for a restructuring of the National Institutes of Health “to ensure operations are effective and efficient,” with no detail provided. It would also place the Agency for Healthcare Research and Quality under the auspices of NIH.
The Strategic National Stockpile would be managed by the Assistant Secretary for Preparedness and Response “to consolidate strategic decision making around the development and procurement of medical countermeasures, and streamline operational decisions during responses to public health and other emergencies to improve responsiveness.”
HHS’s Azar teases changes to APMs
“I am not sure that simply being in an alternative payment model, which was the metric the Obama administration used, is the one that I would find to be substantive and real in terms of transformation of our health care system,” Mr. Azar said June 20 at a forum hosted by the Washington Post.
The previous administration set a goal of having at least 50% of physician Medicare payments tied to quality by the end of this year. It’s first milestone of 30% by the end of 2016 was reached in March of that year.
The current administration may have had a tough time meeting the 50% goal because of changes it made to the Quality Payment Program exempted two-thirds of eligible clinicians from the Merit-Based Incentive Payment System track in 2018.
Mr. Azar said that he is working with the team at the Centers for Medicare & Medicaid Services to come up with a better way to determine whether paying for quality is effective.
“What I don’t want to do is have an approach where it’s a tag the base, hit a scorecard number,” he said. “We genuinely want to revolutionize how health care is paid for in this country in an outcome-based, health-based, non-procedure-, non-sickness-based way. We are working on that. We want to get to real concrete metrics.”
Mr. Azar also noted that the agency is working on “the concrete strategy for the Center for Medicare & Medicaid Innovation. That will also have dimensions for what we are doing within the fee-for-service program and Medicare Advantage around moving toward value-based payment arrangements.”
He praised the efforts of the Bush Administration and the Obama Administration as providing a good foundation for the transition to paying for quality and “we will build on that.”
“I am not sure that simply being in an alternative payment model, which was the metric the Obama administration used, is the one that I would find to be substantive and real in terms of transformation of our health care system,” Mr. Azar said June 20 at a forum hosted by the Washington Post.
The previous administration set a goal of having at least 50% of physician Medicare payments tied to quality by the end of this year. It’s first milestone of 30% by the end of 2016 was reached in March of that year.
The current administration may have had a tough time meeting the 50% goal because of changes it made to the Quality Payment Program exempted two-thirds of eligible clinicians from the Merit-Based Incentive Payment System track in 2018.
Mr. Azar said that he is working with the team at the Centers for Medicare & Medicaid Services to come up with a better way to determine whether paying for quality is effective.
“What I don’t want to do is have an approach where it’s a tag the base, hit a scorecard number,” he said. “We genuinely want to revolutionize how health care is paid for in this country in an outcome-based, health-based, non-procedure-, non-sickness-based way. We are working on that. We want to get to real concrete metrics.”
Mr. Azar also noted that the agency is working on “the concrete strategy for the Center for Medicare & Medicaid Innovation. That will also have dimensions for what we are doing within the fee-for-service program and Medicare Advantage around moving toward value-based payment arrangements.”
He praised the efforts of the Bush Administration and the Obama Administration as providing a good foundation for the transition to paying for quality and “we will build on that.”
“I am not sure that simply being in an alternative payment model, which was the metric the Obama administration used, is the one that I would find to be substantive and real in terms of transformation of our health care system,” Mr. Azar said June 20 at a forum hosted by the Washington Post.
The previous administration set a goal of having at least 50% of physician Medicare payments tied to quality by the end of this year. It’s first milestone of 30% by the end of 2016 was reached in March of that year.
The current administration may have had a tough time meeting the 50% goal because of changes it made to the Quality Payment Program exempted two-thirds of eligible clinicians from the Merit-Based Incentive Payment System track in 2018.
Mr. Azar said that he is working with the team at the Centers for Medicare & Medicaid Services to come up with a better way to determine whether paying for quality is effective.
“What I don’t want to do is have an approach where it’s a tag the base, hit a scorecard number,” he said. “We genuinely want to revolutionize how health care is paid for in this country in an outcome-based, health-based, non-procedure-, non-sickness-based way. We are working on that. We want to get to real concrete metrics.”
Mr. Azar also noted that the agency is working on “the concrete strategy for the Center for Medicare & Medicaid Innovation. That will also have dimensions for what we are doing within the fee-for-service program and Medicare Advantage around moving toward value-based payment arrangements.”
He praised the efforts of the Bush Administration and the Obama Administration as providing a good foundation for the transition to paying for quality and “we will build on that.”
FDA already balances safety, access to investigational drugs
The Food and Drug Administration is generally achieving the balance between ensuring safety and providing access to investigational drugs through compassionate use programs, according to results from a new analysis that found that most of these drugs are available within 6 months of an application to the FDA.
But that balance may be threatened by the recently enacted Right to Try Act, Jeremy Puthumana, of Yale University, New Haven, Conn., and his colleagues reported in an article published on JAMA Network Open. They said the new law encourages sponsors to make investigational drugs available earlier in the clinical development period, potentially jeopardizing safety.
“These findings suggest the FDA and the pharmaceutical industry have established a balance between investigational new drug access and protection of patients from therapies without established safety, which may be compromised by policy makers seeking to speed access to investigational medicines through the Right to Try Act by removing the requirements for FDA oversight and approval of expanded access requests,” the researchers wrote.
The cross-sectional study examined all expanded access programs registered with ClinicalTrials.gov through Aug. 1, 2017. Of 92 expanded access programs for investigational drugs, 69.6% were initiated within 6 months following (43.5%) or preceding (26.1%) submission of a new drug application. Ninety of the 92 drugs ultimately went on to receive FDA approval.
Of the most common uses of the 92 drugs registered in expanded access programs between September 1996 and June 2017, half were used for the treatment of cancer; 16 drugs were used to treat metabolic, endocrine, and genetic diseases; and 14 drugs were used for the treatment of infectious diseases. But there were no significant differences in the timing of program initiation by therapeutic characteristics, the researchers found.
President Donald Trump signed the Right To Try Act of 2017 (S. 204) into law on May 30, 2018, despite opposition from physician and patient groups who expressed concerns that the law will remove FDA safeguards.
The study was funded by a grant from the National Institutes of Health. The researchers reported research support from the Laura and John Arnold Foundation, Johnson and Johnson, Medtronic, the Blue Cross-Blue Shield Association, the FDA, and other federal agencies.
SOURCE: Puthumana J et al. JAMA Network Open. 2018 Jun 15. doi:10.1001/jamanetworkopen.2018.0283.
The Food and Drug Administration is generally achieving the balance between ensuring safety and providing access to investigational drugs through compassionate use programs, according to results from a new analysis that found that most of these drugs are available within 6 months of an application to the FDA.
But that balance may be threatened by the recently enacted Right to Try Act, Jeremy Puthumana, of Yale University, New Haven, Conn., and his colleagues reported in an article published on JAMA Network Open. They said the new law encourages sponsors to make investigational drugs available earlier in the clinical development period, potentially jeopardizing safety.
“These findings suggest the FDA and the pharmaceutical industry have established a balance between investigational new drug access and protection of patients from therapies without established safety, which may be compromised by policy makers seeking to speed access to investigational medicines through the Right to Try Act by removing the requirements for FDA oversight and approval of expanded access requests,” the researchers wrote.
The cross-sectional study examined all expanded access programs registered with ClinicalTrials.gov through Aug. 1, 2017. Of 92 expanded access programs for investigational drugs, 69.6% were initiated within 6 months following (43.5%) or preceding (26.1%) submission of a new drug application. Ninety of the 92 drugs ultimately went on to receive FDA approval.
Of the most common uses of the 92 drugs registered in expanded access programs between September 1996 and June 2017, half were used for the treatment of cancer; 16 drugs were used to treat metabolic, endocrine, and genetic diseases; and 14 drugs were used for the treatment of infectious diseases. But there were no significant differences in the timing of program initiation by therapeutic characteristics, the researchers found.
President Donald Trump signed the Right To Try Act of 2017 (S. 204) into law on May 30, 2018, despite opposition from physician and patient groups who expressed concerns that the law will remove FDA safeguards.
The study was funded by a grant from the National Institutes of Health. The researchers reported research support from the Laura and John Arnold Foundation, Johnson and Johnson, Medtronic, the Blue Cross-Blue Shield Association, the FDA, and other federal agencies.
SOURCE: Puthumana J et al. JAMA Network Open. 2018 Jun 15. doi:10.1001/jamanetworkopen.2018.0283.
The Food and Drug Administration is generally achieving the balance between ensuring safety and providing access to investigational drugs through compassionate use programs, according to results from a new analysis that found that most of these drugs are available within 6 months of an application to the FDA.
But that balance may be threatened by the recently enacted Right to Try Act, Jeremy Puthumana, of Yale University, New Haven, Conn., and his colleagues reported in an article published on JAMA Network Open. They said the new law encourages sponsors to make investigational drugs available earlier in the clinical development period, potentially jeopardizing safety.
“These findings suggest the FDA and the pharmaceutical industry have established a balance between investigational new drug access and protection of patients from therapies without established safety, which may be compromised by policy makers seeking to speed access to investigational medicines through the Right to Try Act by removing the requirements for FDA oversight and approval of expanded access requests,” the researchers wrote.
The cross-sectional study examined all expanded access programs registered with ClinicalTrials.gov through Aug. 1, 2017. Of 92 expanded access programs for investigational drugs, 69.6% were initiated within 6 months following (43.5%) or preceding (26.1%) submission of a new drug application. Ninety of the 92 drugs ultimately went on to receive FDA approval.
Of the most common uses of the 92 drugs registered in expanded access programs between September 1996 and June 2017, half were used for the treatment of cancer; 16 drugs were used to treat metabolic, endocrine, and genetic diseases; and 14 drugs were used for the treatment of infectious diseases. But there were no significant differences in the timing of program initiation by therapeutic characteristics, the researchers found.
President Donald Trump signed the Right To Try Act of 2017 (S. 204) into law on May 30, 2018, despite opposition from physician and patient groups who expressed concerns that the law will remove FDA safeguards.
The study was funded by a grant from the National Institutes of Health. The researchers reported research support from the Laura and John Arnold Foundation, Johnson and Johnson, Medtronic, the Blue Cross-Blue Shield Association, the FDA, and other federal agencies.
SOURCE: Puthumana J et al. JAMA Network Open. 2018 Jun 15. doi:10.1001/jamanetworkopen.2018.0283.
FROM JAMA NETWORK OPEN
Key clinical point: Major finding: Nearly 70% of investigational drugs registered in expanded access programs were made available outside of clinical trials within 6 months of submission of a new drug application.
Study details: A cross-sectional study examining expanded access and compassionate use programs registered through Aug. 1, 2017.
Disclosures: The study was funded by grant from the National Institutes of Health. The researchers reported research support from the Laura and John Arnold Foundation, Johnson and Johnson, Medtronic, the Blue Cross-Blue Shield Association, the FDA and other federal agencies.
Source: Puthumana J et al., JAMA Network Open. 2018 Jun 15. doi:10.1001/jamanetworkopen.2018.0283.
Azar blames PBMs for no drop in prescription prices
“The president said that, in reaction to the release of the drug pricing blueprint, drug companies would be ‘announcing voluntary massive drops in prices within 2 weeks,’ ” Sen. Elizabeth Warren (D-Mass.) said during a hearing of the Senate Health, Education, Labor, and Pensions Committee to review the administration’s plan to lower drug costs.
Sen. Warren said she, along with Sen. Tina Smith (D-Minn.), sent letters to the top 10 drug manufacturers to get a pricing update and see what products were going to be the recipient of price cuts in response to the blueprint.
She then asked Alex Azar, Health & Human Services secretary and the hearing’s only witness, which manufacturers the president was referring to when he said drug companies would be reducing prices.
“There are actually several drug companies that are looking at substantial and material decreases of drug prices in competitive classes and actually competing with each other and looking to do that,” Mr. Azar testified. “They are working right now with the pharmacy benefit managers (PBMs) and distributors.”
He went on to blame the PBMs for the inability to lower prices.
“What they are trying to do is work to ensure they are not discriminated against,” he said. “Oddly, the fear is that they would be discriminated against for decreasing their price.”
He noted during the hearing that PBMs get paid based on the rebates they negotiate and could retaliate against manufacturers by placing products on a higher tier or dropping them from formularies in total if manufacturers were to impact the PBM bottom line by dropping prices. He added that one of the options in the blueprint was to ban any financial transactions between the manufacturer and the PBM to ensure there is no conflict of interest and that the PBM is working on behalf of the insurers only to negotiate the best prices for drugs.
Panel Democrats used the hearing to hammer the administration for not following up on President Trump’s campaign promise to allow the government to negotiate Medicare Part D drug pricing. Part of that discussion focused on using government leverage to get “best price” contracts using prices for drugs in other countries, an exercise that Mr. Azar said would theoretically result in manufacturers yanking their drugs out of foreign markets and jacking the prices even more in the United States.
When pressed to try it on a pilot basis with one or two drugs, he pushed back, suggesting that even a pilot trial of it could result in “irreparable harm.”
“The president said that, in reaction to the release of the drug pricing blueprint, drug companies would be ‘announcing voluntary massive drops in prices within 2 weeks,’ ” Sen. Elizabeth Warren (D-Mass.) said during a hearing of the Senate Health, Education, Labor, and Pensions Committee to review the administration’s plan to lower drug costs.
Sen. Warren said she, along with Sen. Tina Smith (D-Minn.), sent letters to the top 10 drug manufacturers to get a pricing update and see what products were going to be the recipient of price cuts in response to the blueprint.
She then asked Alex Azar, Health & Human Services secretary and the hearing’s only witness, which manufacturers the president was referring to when he said drug companies would be reducing prices.
“There are actually several drug companies that are looking at substantial and material decreases of drug prices in competitive classes and actually competing with each other and looking to do that,” Mr. Azar testified. “They are working right now with the pharmacy benefit managers (PBMs) and distributors.”
He went on to blame the PBMs for the inability to lower prices.
“What they are trying to do is work to ensure they are not discriminated against,” he said. “Oddly, the fear is that they would be discriminated against for decreasing their price.”
He noted during the hearing that PBMs get paid based on the rebates they negotiate and could retaliate against manufacturers by placing products on a higher tier or dropping them from formularies in total if manufacturers were to impact the PBM bottom line by dropping prices. He added that one of the options in the blueprint was to ban any financial transactions between the manufacturer and the PBM to ensure there is no conflict of interest and that the PBM is working on behalf of the insurers only to negotiate the best prices for drugs.
Panel Democrats used the hearing to hammer the administration for not following up on President Trump’s campaign promise to allow the government to negotiate Medicare Part D drug pricing. Part of that discussion focused on using government leverage to get “best price” contracts using prices for drugs in other countries, an exercise that Mr. Azar said would theoretically result in manufacturers yanking their drugs out of foreign markets and jacking the prices even more in the United States.
When pressed to try it on a pilot basis with one or two drugs, he pushed back, suggesting that even a pilot trial of it could result in “irreparable harm.”
“The president said that, in reaction to the release of the drug pricing blueprint, drug companies would be ‘announcing voluntary massive drops in prices within 2 weeks,’ ” Sen. Elizabeth Warren (D-Mass.) said during a hearing of the Senate Health, Education, Labor, and Pensions Committee to review the administration’s plan to lower drug costs.
Sen. Warren said she, along with Sen. Tina Smith (D-Minn.), sent letters to the top 10 drug manufacturers to get a pricing update and see what products were going to be the recipient of price cuts in response to the blueprint.
She then asked Alex Azar, Health & Human Services secretary and the hearing’s only witness, which manufacturers the president was referring to when he said drug companies would be reducing prices.
“There are actually several drug companies that are looking at substantial and material decreases of drug prices in competitive classes and actually competing with each other and looking to do that,” Mr. Azar testified. “They are working right now with the pharmacy benefit managers (PBMs) and distributors.”
He went on to blame the PBMs for the inability to lower prices.
“What they are trying to do is work to ensure they are not discriminated against,” he said. “Oddly, the fear is that they would be discriminated against for decreasing their price.”
He noted during the hearing that PBMs get paid based on the rebates they negotiate and could retaliate against manufacturers by placing products on a higher tier or dropping them from formularies in total if manufacturers were to impact the PBM bottom line by dropping prices. He added that one of the options in the blueprint was to ban any financial transactions between the manufacturer and the PBM to ensure there is no conflict of interest and that the PBM is working on behalf of the insurers only to negotiate the best prices for drugs.
Panel Democrats used the hearing to hammer the administration for not following up on President Trump’s campaign promise to allow the government to negotiate Medicare Part D drug pricing. Part of that discussion focused on using government leverage to get “best price” contracts using prices for drugs in other countries, an exercise that Mr. Azar said would theoretically result in manufacturers yanking their drugs out of foreign markets and jacking the prices even more in the United States.
When pressed to try it on a pilot basis with one or two drugs, he pushed back, suggesting that even a pilot trial of it could result in “irreparable harm.”