Wednesday, May 16, 2018

Brief Blog: National Academies Releases a Report on Paying for Costly Illness; Chance to Revisit Drug Pricing Report 2017

On May 16, 2018, the National Academy of Sciences released a 71-page ebook on "Financing and Payment Strategies to Support High Quality Care for People with Serious Illness."   Find the ebook here.  The underlying workshop was held in Washington at NAS last November, here.

May 2018: Financing and Payment Strategies EBook

Returning to the opening topic of the new May 2018 ebook on health financing.  The "Financing and Payment Strategies" ebook, planned and executed more cohesively under one administration, is much shorter and has chapters like "challenges and lessons of fee-for-service" and "challenges and lessons from global budgeting arrangements."  The ebook does not have panel consensus recommendations but includes several pages of individual recommendations as remarked on in the course of the meeting, by individual participants.  

December 2017:  More Ruckus Over NAS EBook on Drug Pricing Options

With all the visibility to last week's speech by President Trump on U.S. drug pricing, we should recall that National Academies also released a 235-page ebook on drug pricing last November 30, 2017.   That report was based on a December 13, 2016 conference (e.g., planned under Obama administration), here, here

The November 2017 release included a one-hour conference (video here).  Find a unique cloud transcript of the videoconference, here.   On December 13, 2017, there was an Energy & Commerce hearing on drug pricing; website here, Politico here, WaPo here.

Find a summary of the Making Medicines Affordable November 2017 release, citing six trade journal articles, condensed at Kaiser Health News, here

Drug pricing recommendations included:
  • Accelerate market entry, including generics and biosimilars
  • Consolidate government purchasing power and apply it
  • Improve drug valuation methods
  • Greater transparency of cash flows in drug supply chain
  • Discourage DTC advertising
  • Modify & mitigate cost burdens for patients
  • "Eliminate misapplication of funds in federal discount programs" e.g. 340B
  • Target incentives for rare diseases only to rare diseases
  • Align physician prescribing with value
The drug pricing book took one year to appear, longer than the usual NAS timetable of four to six months.  The ebook contains a 20-page dissenting view by Michael Rosenblatt and the late biopharma entrepreneur Henri Termeer.  The dissent chapter appeared, in part. in NEJM here.  Rosenblatt is a physician executive at Flagship Pioneering.   The ebook also contains a shorter, 5-page "minority view" with remarks such as, "Patients are left at the mercy of coverage and pricing decisions that are completely unknown to them."  

Jump from December 2017 to May 2018.    
In Mid-May 2018, NPR highlighted 3 facets of the new Trump proposals as (1) more transparency for supply chain channels and PBM discounts, (2) shift some costly drugs from Part B (average sales price) to Part D (negotiated Part D plan price), and (3) make it much easier to find Medicare and Medicaid drug prices.  (These prices are often available today on CMS websites and fee schedules most easily found by experts.)  
A transcript of a speech by HHS Secretary Alex Azar on the drug topic May is here; a second speech on May 16 is here.  Trade article here.  Both speeches & trade article in the cloud here (7000 words.)  Redline comparing the two speeches is here.


NAS notes that both books are conference reports of diverse panels and do not represent positions of NAS itself.

Since both ebooks are about health pricing, it might be of interest to compare with the May 16, 2018, New York Times article on the US healthcare price explosion after 1980 by economist Austin Frakt - here.

The same week as the NAS report on healthcare costs and strategies, the Urban Institute issued a plan for subsidized insurance that would reduce the uninsured by 16 million, here.