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A few days ago, I had a short blog highlighting a new December 2019 Health Affairs article by Oxford's Kushal Kadakia on reforming CMS reimbursement methods and policies (blog here, article here).
It turns out that Health Affairs actually published twin articles, both on December 18, on the theme of seriously rebooting and redesigning reimbursement, at CMS and elsewhere in the US health system.
- The first blog, by Kushal Kadakia, takes its launching point from the October 2019 Trump executive order directed mostly at CMS, for example, asking CMS to reform its parallel review process and define "reasonable and necessary."
- Kadakia blog article here, Trump executive order entry point here.
- Kadakia was part of a 2017 review article by Mark McClellan and others on value based purchasing , spent Summer 2019 at CMS, and is now on a fellowship at Oxford.
- This article basically walks through key points of the E.O. and amplifies it by suggesting ways CMS could actually implement the updates and changes.
- The second blog is by an all-star cast of Mark McClellan, Morgan Romine, Jeff Allen, Tanisha Carino, and Scott Gottlieb.
- Blog article here.
- This article highlights the advances in FDA approval processes and resources initiated in 2017 by 21st Century Cures Act, and then states that no similar deep-dive reboot has occurred at CMS (or the rest of the US reimbursement.) They find flaws in all the major components - coverage, coding, payment, clarity.
- See also a December 2019 request for information from the Hill, asking healthcare stakeholders how US reimbursement might be improved. Here. Many of the questions in the RFI focused on reimbursed and would use the input to design a new Cures 2.0 bill for 2020.
- Can CMS Fast-Follow FDA's Lead on Communications? I'd add communications as a fundamental problem. See a December 2019 article by Peter Pitts about FDA's attempts to improve its two-way communications with industry here. That could also be a model for adaptation with payers.
- See the website on the FDA's all-day November 7 meeting between FDA and stakeholders about how FDA could improve its communications: here. Webpage includes video and 20 PDF presentations.
- I've put all the agenda, presentations, and unofficial transcript in one 10mb cloud zip file here.
- Why not: CMS could have similar full day town hall some day about how it could improve processes for NCDs and LCDs.
- In the same vein, FDA published a very good new draft guidance in December on what it considers good trial design for evidence evaluation; entry point here.
Pricing Always In The News
There's almost always something monthly, if not weekly, news about US pricing. The New York Times' Margot Singer-Katz had a long lead article on perceived excesses of US pricing on December 27, 2019 - here.
Although not brand new, the Washington Post online was highlighting, as part of 2019's year-in-review, an August 2019 article by Eli Saslow about long lines of poor citizens shuffling into courtrooms being sued by their local hospitals, for example, after two-hour $8000 emergency room stopovers. Here. (In fairness to the rural hospitals, Saslow notes many are teetering on the edge of bankruptcy themselves, just like their patients.) NPR and others reported how a woman saw her doctor for a head cold and ended up with $20,000 of marked-up out of network shotgun testing virology bills (here) - many of which her insurer paid.
And there's usually something new every week or two regarding surprise billing legislation on the Hill; see a flurry of letters form House Energy & Commerce to the major national insurers released on December 18, here.
Meanwhile, 360Dx had a (subscription) article by Adam Bonislawski, discussing surprise billing laws at the state level and impacts on labs, here. Citing in part Erin Duffy's work on health pricing policy at USC.
Meanwhile, 360Dx had a (subscription) article by Adam Bonislawski, discussing surprise billing laws at the state level and impacts on labs, here. Citing in part Erin Duffy's work on health pricing policy at USC.
Health Prices: The Late Uwe Reinhardt's Last Book
Since I first heard of his work doing a healthcare MBA in 2000, I've tracked Princeton health economist Uwe Reinhardt, whom I heard speak once at a conference. He died unexpectedly of sepsis at age 80 in November 2019.
He was based known for the argument that US healthcare doesn't so much use any more resources than other countries, but simply has higher pricing (2003 here, and 2019 update here.)
Second to that, we also have much higher administrative costs (see NYT December 31 on docs and nurses buried in paperwork, or actually e-work).
Second to that, we also have much higher administrative costs (see NYT December 31 on docs and nurses buried in paperwork, or actually e-work).
In brief, this past week I learned that Reinhardt left a completed book on US health policy and economics, which appeared in May 2019. Here ("Priced Out;" hardcover, ebook, or audiobook). Reviews here, here. Videocast of a 90 minute panel discussion hosted by KFF, here. Let me also note, the book brings together many good graphs in one place.
Update 2/11/2020
This article notes that the October Trump Executive Order requested modernizations at CMS, and the twin articles in Health Affairs elaborated on that Executive Order.
The Trump budget plan summary for FY2021, released in early February 2020, also contained similar quotations about CMS coverage policy (essentially echoing Trump's own October 2020 executive order):
https://www.hhs.gov/sites/default/files/fy-2021-budget-in-brief.pdf.
Improve Clarity and Transparency
of the Medicare Coverage Process
Many stakeholders find the process and standards for the Medicare coverage determination process lack clarity. This proposal requires CMS to issue additional guidance around the Medicare coverage process, including sub-regulatory guidance on the evidence standards that CMS utilizes in assessing coverage and the process to appeal coverage determinations, in an effort to improve clarity around Medicare coverage. [Budget Neutral]
Strengthen the Parallel Review Process
to Streamline Medicare Coverage
The Parallel Review program is a collaborative effort between the Food and Drug Administration (FDA) and CMS that reduces the time between FDA approval of a device and Medicare coverage of that item. This proposal strengthens the existing parallel review process to improve device manufacturer participation and increase transparency. [Budget Neutral]
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Thanks to a former CMS senior official for pointing out that these Trump 2021 paragraphs are pretty similar to Obama 2012 paragraphs in a document called bioeconomy blueprint:
https://obamawhitehouse.archives.gov/sites/default/files/microsites/ostp/national_bioeconomy_blueprint_april_2012.pdf
Expanding the Coverage with Evidence Development Program to Drive Innovation: Reimbursement for medical treatments is a powerful driver of industry investment. Under the Coverage with Evidence Development (CED) program, Medicare reimburses for promising new technologies that do not currently meet the standard for full coverage. The CED program requires more evidence to be collected to determine full potential benefit of new technologies. The CED authority has existed for more than a decade but has been applied sparingly. The Centers for Medicare & Medicaid Services (CMS) is poised to implement the next phase of CED by better defining the parameters and guidance for CED so it can be used more widely and effectively as a driver of innovation. CMS believes that the lessons learned during the initial implementation of CED can inform its more frequent use and create predictable incentives for innovation while providing greater assurance that new technologies in fact fulfill their initial claims of benefit.
Reducing the Time to Market by Implementing Parallel Regulatory Reviews for Medical Products: FDA approval and CMS coverage significantly influence the development and commercial success of new medical products. The time required for FDA and CMS to sequentially review new medical products—often multiple years—is frequently cited as a disincentive for innovators and investors in the medical technology industry. A significant portion of this delay is due to the fact that most sponsors of new products approach each reviewing agency separately, first working to meet the evidentiary requirements of the FDA and only later focusing on the requirements of CMS. To address this problem, the FDA and CMS initiated a pilot program for the parallel review of medical devices, creating a pathway for new medical products to be simultaneously reviewed by both agencies. By engaging CMS earlier in the process, the parallel review program is expected to limit the duplication of effort on the part of product sponsors and agency reviewers and reduce the time it takes new products to enter the market and receive payments from Medicare and other providers.
