The Goose and the Elephant

Brian-KlepperAmerica’s drug and biotech industries are no doubt alarmed by the national firestorm that erupted when Turing Pharmaceuticals raised the price 55 times of its 62 year old lifesaving drug, daraprim. They must worry that CEO Martin Shkreli’s tone-deaf reactions to the public’s scorn could precipitate close scrutiny of broader drug industry dynamics. The last thing pharma wants is a vigorous, in-depth national discussion of pricing, value, what we can afford and how other advanced countries handle drug spending. All this could kill the golden goose.

Seeking distance from the furor, PhRMA tweeted that “Turing Pharma does not represent the values of PhRMA’s member companies.” Then BIO, the biotech industry’s association, rescinded Turing’s membership and returned its dues, the equivalent of booting Turing out of the country club.

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The RUC, Health Care Finance’s Star Chamber, Remains Untouchable

Brian Klepper

Posted 2/1/13 on The Health Affairs Blog

BK PhotoOn January 7, a federal appeals court rejected six Georgia primary care physicians’ (PCPs) challenge to the Centers for Medicare and Medicaid Services’ (CMS) 20-year, sole-source relationship with the secretive, specialist-dominated federal advisory committee that determines the relative value of medical services. The American Medical Association’s (AMA) Relative Value Scale Update Committee (RUC) is, in the court’s view, not subject to the public interest rules that govern other federal advisory groups. Like the district court ruling before it, the decision dismissed the plaintiffs’ claims out of hand and on procedural grounds, with almost no discussion of content or merit.

Thus ends the latest attempt to dislodge what is perhaps the most blatantly corrosive mechanism of US health care finance, a star-chamber of powerful interests that, complicit with federal regulators, spins Medicare reimbursement to the industry’s advantage and facilitates payment levels that are followed by much of health care’s commercial sector. Most important, this new legal opinion affirms that the health industry’s grip on US health care policy and practice is all but unshakable and unaccountable, and it appears to have co-opted the reach of law.

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Niseritide, the “Lost Decade”, and the Pinto

Patricia Salber

First posted 7/14/11 on The Doctor Weighs In

Eric Topol, MD wrote an interesting commentary in the July 7, 2011 issue of the New England Journal of Medicine, titled “The Lost Decade of Nesiritide.” Nesiritide is a drug for heart failure symptoms (e.g., shortness of breath) that was approved by the FDA in 2001. Since that time, according to Dr. Topol, “well more than $1 Billion was wasted on purchasing the drug.”

It turns out that the FDA approved the drug was based on a relatively small, not particularly well done clinical trial that showed improvement in self-reported symptoms of shortness of breath 3 hours after the drug was administered. Once the drug was approved, the drug was marketed like crazy. For profit outpatient heart failure “tune up” clinics opened so that heart failure patients could get weekly intravenous infusions of the drug.

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Secret Shoppers: Needing A Weatherman To Know Which Way The Wind Blows

Brian Klepper

Every now and then, a well-intentioned administration does something relatively harmless but so hare-brained and openly foolish that it takes our breath away. The Obama Administration’s primary care “secret shopper” plan fit this bill, and has already been shelved due to the withering criticism. My inbox a couple days ago was filled with rants by physicians of all political persuasions marveling at the lameness of the idea.

Here’s a short description from Robert Pear’s article in Sunday’s New York Times.

The administration says the survey will address a “critical public policy problem”: the increasing shortage of primary care doctors, including specialists in internal medicine and family practice. It will also try to discover whether doctors are accepting patients with private insurance while turning away those in government health programs that pay lower reimbursement rates.

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Health Costs Haunt the US’ Long Term Budget Outlook

Jane Sarasohn-Kahn

First published 6/24/11 on Health Populi

“With the aging of the population and growing health care costs, the budget outlook, for both the coming decade and beyond, is daunting,” reports the Congressional Budget Office (CBO) in the2001 Long-Term Budget Outlook report. If you read between the lines and into the future scenarios on health spending and budget deficits, it’s clear that as Baby Boomers age, America’s fiscal outlook gets bleaker by the year.

Spending on Medicare, and health care as it’s paid for today, is unsustainable. The pie chart shows that 22% of spending on health was for Medicare in 2009, 17% was allocated to Medicaid and CHIP for children, and 11% of spending was for other public health programs provided by state and local governments, the Department of Veterans Affairs, the Department of Defense, and workers’ comp.

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Why Primary Care Needs A New Organization

Paul M. Fischer

First published on 6/15/11 on MedPage Today

A few weeks ago, the Board of the American Academy of Family Physicians (AAFP) announced that, for now, it would continue participating in the Relative Value Scale Update Committee (RUC), the secretive American Medical Association committee that, through a longstanding relationship with the Centers for Medicare and Medicaid Services (CMS), has heavily influenced physician reimbursement.

At nearly the same time, Medicare announced that it will go broke in 2024, a decade sooner than expected and only 13 years away.

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Means Testing Medicare Premiums

by Patricia Salber

First published 6/14/11 on The Doctor Weighs In

With all of the hullabaloo about health reform, the Ryan plan and other Medicare-related excitement, I somehow missed a major change in how Medicare is doing business – which is pretty funny since I have spent the last 5 years working for Medicare Advantage plans.  Since January 2011, Medicare has been means testing the Part B premium.  Even more amazing is that some of my most wonky policy wonk friends didn’t know about this – not mentioning any names.

Anyway, I found out in the rudest of ways – a letter from the Social Security Administration describing the impact of the new approach on my own premiums.  It was a shocker for someone used to paying nothing for health care.  (I know, no sympathy for me on that one.)

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