This Week in Managed Care: March 6, 2020

A study finds key drug prices are soaring, Congress provides funds for coronavirus, and alcohol-related deaths are rising.

Welcome to This Week in Managed Care, I’m Christina Mattina.

List Prices Doubled in the Past Decade

List prices for key drugs more than doubled in the decade ending in 2018, with agents that treat multiple sclerosis and lipids and insulin leading the way.

Those were key findings from a special issue of JAMA that examined rising prescription drug costs, which authors of editorials said will be an issue in this year’s presidential election.

Led by Dr Inmaculada Hernandez, researchers found that list prices for the 600 drugs studied rose an average of 159%. While net costs were often much lower, the system of rebates and discounts had unintended consequences. Key takeaways were:

• Net prices still increased at 3 times the rate of inflation.
• The widening gap between list and net prices contributes to patient access issues, because some are uninsured or underinsured.
• There was wide variability in out-of-pocket costs at the counter.

Merck President and CEO Ken Frazier wrote in an editorial that while the pharmaceutical industry is adjusting its business model with regard to rebates, more needs to be done. He said:

• The industry “has a duty” for responsible pricing practices
• The rebate system must be reformed
• The industry must respect the intent of patent protections and stop “gaming the system”
• The industry must collaborate on value-based contracts
• The industry must align with other parts of healthcare for reform

COVID-19 Updates: Funding Package Approved by Congress

Congress this week reached an agreement for $8 billion in emergency funds to fight the coronavirus. The bill that will reach President Trump’s desk covers more aid than requested after the death toll rose throughout the week and a Washington State nursing home emerged as a center of an outbreak.

The package would include:

• $3 billion for research and development of vaccines and treatments
• $3.1 billion for public health and social services
• $1.2 billion for the State Department to battle coronavirus overseas

The spread of coronavirus is affecting scientific collaboration, as some meetings have been canceled, and NYU Langone Health has imposed a 60-day travel ban on its employees.

For regular updates, visit ajmc.com.

Alcohol-Related Deaths On the Rise

Alcoholic liver disease rose 78% from 2000 to 2016, according to a recent study in JAMA Network Open.

White women, Native Americans, and Alaska Natives are among those with higher rates of alcohol-related deaths, which are happening more often in middle age.

The authors said: “While we noted widespread increases geographically, our observation that the highest rates of death among white individuals occurred in the western United States echoes prior observations that states within this region had some of the highest historical per capita alcohol consumption levels. However, alcohol consumption levels are unlikely to fully explain mortality trends. Lack of access to high quality care for alcohol misuse and alcohol-associated diseases plays an important role in mortality vs morbidity. Indeed, alcohol-induced deaths should be considered a function of both alcohol misuse and insufficient primary, secondary, and tertiary prevention.”

Health Plan Auto Re-enrollment May Not Continue

CMS may end automatic re-enrollment for some low-income consumers in health plans under the Affordable Care Act. Advocates worry the change could lead to a rise in the uninsured rate and say consumers will need more education if this change is to occur.

A particular sticking point is the use of manufacturer drug coupons toward a consumer’s annual out of pocket spending limit.

Health insurers and employers want to end this practice, while consumer groups say it could hurt those who have a hard time paying for prescriptions.

Said Margaret Murray of the Association of Community Affiliated Plans: “The policy discussed by CMS would sow significant confusion and lead to loss of coverage unless consumers take counterintuitive steps. This proposal has a disproportionate impact on low-income consumers. What’s most disquieting is that that seems to be the point.”

Paper of the Week

Finally, we bring you paper of the week, which looks back at some of the most important research and commentary of the past 25 years in The American Journal of Managed Care^® and why they matter today.

This week’s selection was one of our most-read articles of 2018.

“Variation in Markups on Outpatient Oncology Services in the United States” found that high variation in markups for cancer care services was an impediment to quality care.

This kind of practice led to the rise of the Oncology Care Model and other alternative payment models in cancer care, which are explored each year at our annual conference, Patient-Centered Oncology Care.

For our paper of the week, visit ajmc.com.

And visit our site for our new issue that recaps the 2019 PCOC meeting.

For all of us at AJMC^®, I’m Christina Mattina. Thanks for joining us.