It's the Providers' Turn to Make the Transformation
I just read Dr. Don Berwick's speech at the IHI National Forum and I am awed with his insight and inspiration. It reminds me of the speech that I heard Dr. Ken Kaiser give at a Veterans Administration conference that led to the transformation of the VA health system from "worst to first" in the 1990s.
Dr. Berwick discusses how our nation is at a crossroads on health care where "choice is stark — chop or improve." Everyone seems to agree that the political stalemate will continue during 2012 with the election and Supreme Court decision on health care reform. Experts expect paralysis until 2013 when real and substantial budget cuts will be unavoidable. Dr. Berwick is right that in the past the usual solution has been across the board cuts through budget reconciliation. Any cuts need to be thoughtful and support value improvement.
Dr. Berwick is hopeful that sensible solutions can be found by the provider community at the local level. He notes that government, payers and regulators cannot do what must be done. "Only people who give care can improve care." He recommends six areas where providers can cut costs and improve value — overtreatment, failures of coordination, failures of reliability, administrative complexity, pricing failures, fraud and abuse. He estimates that waste in these areas could be $1 trillion a year or one-third of the total cost of production in the health care system.
But is the provider community ready and willing? There is evidence that this is happening. A recent Leavitt report concluded that there were 164 "ACO entities" forming in the country. AHIP reports that there are 30 ACOs and 150 patient centered medical homes. And CMS is developing initiatives in Medicare and Medicaid that will build on these private sector efforts. Other leaders are trying to inspire change that avoids across the board cuts. At the recent Politico Policy conference, Dr. Ken Thorpe reminded us all that the focus needs to be on the patients with chronic illness, which will require moving away from provider silos to provider cooperation. Policy discussions at a recent Alliance for Health Reform focused on the next steps after the failure of the Super Committee. Experts noted the fundamental differences in opinions between the Republicans and Democrats on health care policy. Several experts agreed that many in the provider community understand that business as usual will not be possible and that the "gig is up". These providers are developing ACOs and medical homes and thinking about approaches to bundled payment. However it was noted that any savings from these initiatives will not be scored by CBO and that the timeline to implement these changes is longer than the Congressional budget schedule. One positive recommendation is that the CMS Innovation Center spend more time on the Hill while the providers in the community undertake the necessary transformation of the delivery system.
Berwick, Unshackled, Blasts "Death Panels"
Freed from the shackles of his Washington job, last week former CMS Administrator Don Berwick described for an audience of health policy wonks Washington's cynicism, epitomized by the "hogwash" claim that health reform included "death panels."
"The outrageous rhetoric about death panels — the claim, nonsense, fabricated out of nothing but fear and lies, that some plot is afoot to, literally, kill patients under the guise of end-of-life care. That is hogwash," Berwick said Wednesday to his old think tank, the Institute for Health Improvement's annual conference in Orlando. He went on to say that the death panel rhetoric "is purveyed by cynics; it employs deception; and it destroys hope. It is beyond cruelty to have subjected our elders, especially, to groundless fear in the pure service of political agendas...It is one of the great and needless tragedies of this stormy time in health care that the ‘death panel' rhetoric has denied patients the care that they want, denied caregivers the information they need to give that care, and denied our nation access to a mature, open, informed, and balanced discussion of the challenge of advanced illness and the commitment to individual dignity. It is a travesty."
It was a stunning departure in tone for Berwick, who was unfailingly polite throughout his 16-month tenure at CMS. And I couldn't agree more. End-of-life care is a personal crusade of mine and my mother, Dr. Susan Black, a prominent family physician and palliative care advocate.
You'll recall the ridiculous notion of death panels erupted when former Alaska Governor and GOP vice presidential candidate Sarah Palin said the health care law would mean seniors would have to stand in front of a panel of Federal regulators to find out if they were worthy of health care. It was beyond preposterous, but it stuck -- and arguably set the debate on end-of-life care back a decade. The issue dogged the administration long after the ACA was passed: in January, the administration yanked language on end-of-life planning for seniors from a Medicare regulation on annual physicals.
As I've said here before, since the Terri Schiavo circus we have lived in an age of distortions like "Death Panels," where open dialogue on end of life is politicized and limits on what Medicare will cover are demogogued as rationing. The only way out of Medicare's fiscal mess is a mature discussion about how we're going to address the 1 in 4 dollars Medicare spends today in the last 6 months of life. Let's hope the 2012 elections will bring us a fresh crop of "grownups" to have that dialogue.
CMS to Part D Plans: "Curb Use of Antipsychotics in Nursing Home Patients"
Medicare Sponsors' are failing to monitor the safe utilization of antipsychotic drugs among the elderly. CMS is stepping up its warnings to Medicare Plans to implement more effective management of these drugs. Plans can expect increased scrutiny. Will your plan meet the standard?
Patrick Conway, Chief Medical Officer and Director for the CMS Office of Clinical Standards and Quality, told lawmakers that Medicare officials need to do more to stop doctors from prescribing powerful psychiatric medications to nursing home patients with dementia, an unapproved practice that has flourished despite repeated government warnings.
The antipsychotic medications are prescribed to treat people suffering from schizophrenia and bipolar disorder, but they're also given to hundreds of thousands of elderly nursing home patients in the US to pacify aggressive behavior related to dementia. These medications increase the risk of death in seniors, prompting the Food and Drug Administration to issue multiple warnings against prescribing the drugs for dementia.
Medicare improperly paid about $116 million in the first half of 2007 for prescriptions filled in nursing homes for a class of drugs called atypical anti-psychotics, Daniel Levinson told the Senate Committee on Aging in a hearing. Nursing homes should be held accountable for inappropriately dispensing antipsychotic medications for Medicare beneficiaries and pay back the Part D program for those misused medicines.
Since the beginning of the Medicare Part D program, CMS regulations have instructed Part D sponsors to implement cost-effective drug utilization management processes to monitor and control for both under- and over-utilization §423.153(b). However, controls currently in place to address overutilization are largely limited to claim-level edits do not seem to effectively address the type of overutilization.
On September 28, 2011, CMS issued a bulletin entitled "Improving Drug Utilization Review Controls in Part D" stating that CMS expects Part D Sponsors to implement an enhanced retrospective drug utilization review process in which sponsors (and/or their PBM) of opioids, antiretrovirals, and atypical antipsychotics, by:
- Establishing clinical upper thresholds for appropriate dosing consistent with clinical guidelines through sponsor Pharmacy and Therapeutics (P&T) committees.
- Creating and monitoring beneficiary-level utilization reports that could identify unusual patterns of drug use at or near the established clinical thresholds;
- Assigning clinical staff, such as case managers, to review these reports and the beneficiaries‟ medication histories, and determine whether interventions are warranted;
- Address any exception requests through the exceptions and appeal processes.
CMS has provided a roadmap to step up monitoring activity. Plans will face increased scrutiny by CMS for meaningful Drug Utilization Management (DUM) systems both concurrently and retrospectively to ensure appropriate use of antipsychotic drugs.
Some Daylight in the Medicare Reform Debate
This morning's New York Times featured a terrific editorial that provided some daylight for the left in the ongoing Medicare reform debate. Essentially the Times rejects House Budget Committee Paul Ryan's (R-WI) draconian approach but opens the door to examining "premium support" as thought of by Alice Rivlin, former President Clinton's budget director, which is structured more like Medicare Part D, or even the insurance exchanges envisioned in the ACA.
Members of both parties believe Medicare could offer a fixed amount of money to beneficiaries to buy coverage from competing private plans, whose costs and benefits would be tightly regulated by the government. Rivlin urged the Congressional deficit "Super-Committee" to establish an insurance exchange for Medicare beneficiaries where private plans would compete with traditional Medicare and would have to provide the same benefits. The federal contribution in each region would be based on the cost of the second-cheapest option, whether that was a private plan or traditional Medicare.
Rivlin's approach is more "soft-hearted" than Ryan's and recognizes the fundamental premise behind the success of Part D: yes, the government can create an insurance market from a green field -- but it won't accomplish its goals in savings or quality unless CMS regulates the crap out of it. It's market forces plus the stiff arm of regulation that makes "premium support" work.
The Times editorial follows. Remember this sort of debate was unthinkable just a year ago, and we have President Obama and Speaker Boehner to thank for the daylight to examine this big idea.
December 3, 2011
What About Premium Support?
As the election campaign progresses voters can expect to hear a lot of hype — and if we are very lucky some good ideas — about how best to "reform" Medicare. It will take stamina and well-honed skepticism to sort it all out.
Republican politicians are touting the virtues of market competition and calling for a "premium support" plan that would give beneficiaries a set amount of money to shop among private plans for their own insurance. What they do not say is that private plans have long been more costly than traditional Medicare and have shown far less ability to slow spending. Nor do they admit that the most extreme versions of premium support — like the one championed by Representative Paul Ryan — would save the government money mainly by shifting costs to the beneficiaries, who would have to decide whether to forgo treatments or pay more for coverage.
Most Democrats have been fiercely opposed to privatizing Medicare. They believe the traditional system can be reformed to reduce costs without demolishing the whole structure. But with concerns about the rising deficit and the long-term sustainability of Medicare, some centrist Democrats are backing the premium support idea.
As Americans try to figure out who is right or wrong in this debate, here are some matters to consider:
HAS IT BEEN TESTED? The Massachusetts health care reforms already provide premium support to help low- and middle-income people buy private policies on an exchange. Unlike the Ryan plan, the program guarantees everyone a defined, comprehensive set of benefits, and officials bargain aggressively with private plans to keep their premiums down. As a result, annual cost increases have been held well below the premium increases for other private group insurance providing comparable benefits.
The Medicare prescription drug program provides support to help beneficiaries buy coverage from private insurers. The costs have been far less than initially projected, a fact that promoters of premium support trumpet. Market competition has helped, but costs have mainly been held down because many major drugs have gone off patent and have been replaced by cheaper generics.
Perhaps the strongest caution against overselling the benefits of competition is Medicare's own track record. What critics of the current program don't acknowledge is that over the past four decades, Medicare's spending per enrollee has risen much more slowly than private insurance premiums — an average of 8.3 percent a year between 1970 and 2009, compared with 9.3 percent for private premiums. And the private Medicare Advantage plans that cover roughly a quarter of all enrollees cost an average of 10 percent more than what the same coverage would cost in traditional Medicare.
The lesson from all this is that it is far too early to talk about scrapping traditional Medicare. At the same time, serious analysis and testing of premium support are clearly worth pursuing.
A GOOD APPROACH The best proposal for premium support is one that gives beneficiaries choice while protecting them from any added costs if competition does not keep prices down. Enrollees would be given a set amount of money to buy a plan comparable to what Medicare now provides. If they chose a plan that cost less, they could pocket the difference. If they wanted better benefits, they would have to pay the added premium themselves. But if market competition failed to restrain costs, the federal government would increase the support given. So far, this idea has found no support among leading politicians, who apparently have less confidence in market forces than they claim.
SOME BAD APPROACHES Versions of premium support backed by Congressman Ryan and other conservatives have one primary goal: pushing down growth in federal spending on Medicare, even if it means that beneficiaries have to pay far more for coverage. These proposals tie increases in premium support to indexes, like the gross domestic product or the consumer price index, that historically have risen far more slowly than health care costs.
Proponents hope competition will lead private plans to reduce their premiums and that beneficiaries will think seriously about whether they need a costly CT scan. While competition and cost-sharing by beneficiaries could help curb overuse of services, we are skeptical that patients who are chronically ill or nearing the end of life, who account for a huge chunk of Medicare's spending, would second-guess their doctors and choose cheaper care.
The Congressional Budget Office concluded that the Ryan plan would force new enrollees in 2022 to pay thousands of dollars out of pocket for benefits similar to those currently provided by Medicare.
THE NEXT TEST The health care reform law, starting in 2014, will provide premium support subsidies to help people with modest incomes buy private policies on new insurance exchanges. That will be the next big test of whether premium support can work to hold down costs while providing good coverage. With so many uncertainties, it would be rash to weaken or jettison the traditional Medicare program now. The good news is there is some time to get it right.
Risk Adjustment: Are you driving a Pacer or an Audi R8?
How can you tell if your risk adjustment program is a high performance machine?
Here is the quick test:
1. Did you hit your volume target for member evaluations for 2011?
2. Did you hit your revenue target for chart review and member evaluations for 2011?
3. Are you planning for a 2012 Quarter 1 launch for member evaluations?
4. Do you have best in class analytics with a constant 5 to 1 ROI or higher for member evaluations?
5. Are you reducing your dependence on chart review?
6. Are you scrubbing your claims based HCCs for validation & confidence levels?
7. What is your percentage of zero HCCs found in your member evaluation program?
8. What is your percentage of zero HCCs found in charts?
9. Do two different coders agree on your findings?
10. Are any of your vendors on corrective action plans with you?
We have a few more questions for you. If you want to morph your program into a high performance machine, now is the time for best practices discussion, strategic planning, and program improvement.
The Doc Fix Returns
The collapse of the Congressional Deficit "Not-So-Super-Committee" ushered in the return of the "doc fix". With only days left in the Congressional session, lawmakers will be scurrying to address several key healthcare issues, including the imminent 27% physician cut to Medicare FFS rates to physicians, and also the 2013 sequestration across the board cuts to Medicare of 2%. 2012 is an election year. The last thing the President and Members of Congress want is 600,000 members of the American Medical Association declaring war on January 2.
The most time-sensitive remains the doc-fix, as the 27% cut goes into effect on December 31, 2011, if lawmakers do not offset it. Every year since 2002, Congress has "kicked the can" a year or two down the road with temporary fixes. A permanent fix holds a price tag of almost $300 billion, and the hope was the "Supers" would get to it. They didn't, and a permanent fix is WAY out of reach now.
What seems likely is another retroactive adjustment early next year. Lawmakers are considering a 1- or 2-year fix costing $20.6 billion and $38.6 billion, respectively, with possible offsets including reductions to other providers. I'd expect another string attached will be that docs that don't hit their quality measures will take the cut, while high-performing providers will get the fix. This is an important issue way beyond physicians: if Congress doesn't get a fix done, Medicare Advantage rates will get hit in 2013 by as much as 1-2%.
While the doc fix will be addressed as soon as this week, don't expect any "holiday surprise" of a grand bargain on the sequestration cuts or deficit reduction given the political chasm between the parties and the upcoming election. Congress will do the bare minimum to avoid a "white-coat insurrection" but will punt the broader debate on austerity measures for Medicare and Medicaid to the voters next year.
Medicare Advantage - the Value Plan
GAO just came out with a report announcing that Medicare Advantage enrollment increased 6 percent between April 2010 and April 2011 - to 8.4 million beneficiaries - and that the average premium decreased 14 percent between 2010 and 2011. The White House blog and key Senators are citing the GAO report's findings and touting the success of the program in offering value to seniors. However, I have to note that the GAO's statistics are way out of date. As of October 2011, there were 12.1 million beneficiaries enrolled in MA plans. The open enrollment season for 2012 is currently under way and MA plans are predicting a 10 percent increase in enrollment by January 1, 2012. It could be even higher since the average MA premium decreased again for the second year in a row. The GAO report includes CMS comments noting that premiums for 2012 are 4 percent lower than 2011 and 11.5 percent lower when compared to 2010.
Berwick Departs, Tavenner Ascends at CMS
Friday is Dr. Don Berwick's last day as Administrator of CMS, the victim of a recess appointment in 2010 and Congressional Republicans' obsession with keeping him from confirmation. It's a tragic result, as Berwick is a rare visionary talent for our favorite agency. His #2, Marilyn Tavenner, is preparing to take the reins of CMS at a critical moment in our politics and in implementation of health reform. She is a relative unknown, and this morning our friends at Congressional Quarterly published a terrific piece with 10 questions about her we wanted to share here.
Nov. 28, 2011 — 6:17 p.m.
Ten Questions About Marilyn Tavenner
By John Reichard, Nellie Bristol and Jane Norman, CQ
HealthBeat Staff
The announcement last week by Donald M. Berwick that he will step down Dec. 2
as administrator of the Centers for Medicare and Medicaid Services, and the
selection of Marilyn Tavenner, his principal deputy, as his successor, raises
many questions — about not just the future of Medicare and Medicaid, but also
oversight of the wider health system.
As head of CMS, Berwick has advocated innovative programs to improve the
quality and efficiency of treatment in Medicare and Medicaid. He launched
efforts to reorganize and more closely monitor the insurance industry. And he
was determined to improve patient safety. But the overriding task of his agency
since the health care overhaul passed has been to prepare for and begin
implementing the sweeping law.
Tavenner will carry on that work on an acting basis and, if she is confirmed
by the Senate, as permanent CMS administrator. Can she fill Berwick's shoes?
Does she have strengths he doesn't? How will CMS change? Here's our take on what
lies ahead at CMS as new leadership takes over next week.
1. Don Berwick is a passionate and articulate advocate for the health
care law. Marilyn Tavenner seems more reserved and has kept a lower profile.
Will there be hiccups in the implementation of the overhaul now that Berwick is
leaving?
Berwick moves audiences with his descriptions of how he thinks the health law
can change medicine for the better. He is an articulate champion of the idea
that change is not only possible but achievable — based on the work he has done
developing patient safety programs, measuring quality and setting performance
goals, and identifying promising community programs that can be implemented on a
national scale. It's unlikely Tavenner will capture crowds as Berwick does. But
those who have worked with her during her tenure as Virginia's secretary of
health and human services and as an executive with Hospital Corp. of America say
she always has shown a strong commitment to patient care.
Erik Swenssen, who led the department of surgery at Johnston-Willis hospital
outside Richmond when Tavenner rose up through the ranks of the HCA facility
from head of nursing to become its CEO, emphasizes Tavenner's skills as a
pragmatic manager. But he describes her as a visionary, too — but perhaps one
more grounded in the real world of health care.
"I may not agree with all his policies, but this guy has got big ideas," he
says of Berwick. "And personally, some of them I think would be very difficult,
if not impossible, to accomplish. Whereas Marilyn would also be a visionary. But
she's also a pragmatist. She knows doctors, and she knows nurses, and she knows
hospitals. Marilyn will know if you can get from X to Y. And sometimes, from the
outside of the Washington Beltway, I wonder whether the people know, can you get
from X to Y? This isn't a reference to anyone else, but her head is not going to
be in the clouds." The other point about Tavenner is that she is no stranger to
implementing the health care law (PL 111-148, PL 111-152). She's been doing it since she was
appointed principal deputy administrator in February 2010.
2. When is the administration likely to formally send up her
nomination? Will just the Senate Finance Committee handle the confirmation or
will the HELP panel have a say?
Still lots of unknowns on Monday. The White House hasn't yet formally sent
the nomination to the Senate. When it does arrive, the Finance Committee would
handle the confirmation hearings. But there's no word from Chairman Max Baucus, D-Mont., or Senate leadership on
their plans or the timing. Republicans have sent the signal that they expect
confirmation through the committee process — in other words, no rerun of the
Berwick recess appointment that circumvented the Senate. As for the Health,
Education, Labor and Pensions Committee, it's doubtful it would get
involved.
3. How well will Tavenner perform in hearings? Will she be responsive
to lawmakers while still serving as an effective advocate for the health care
law?
Tavenner is still pretty much an unknown when it comes to speechifying and
testifying in Washington as well as dealing with the press.
During an appearance on C-SPAN in November 2010, she appeared to deny that
the health care law includes $500 billion in Medicare and Medicaid cuts, which
it does. Tavenner seemed to be trying to frame the question to her advantage, as
if the question had been whether the health care law would reduce Medicare
benefits, and said it wouldn't. But a viewer might have thought the health care
law doesn't cut Medicare, which it does. As Virginia's secretary for health and
human services, Tavenner wouldn't respond to questions about allegations that
she and then-Gov. Tim Kaine suppressed the findings of a state task force report
(see question below).
On the other hand, Tavenner appears to have handled herself well in hearings
and in meetings with lawmakers in the Virginia Legislature — and, before that,
in other political challenges. "When she was health and human services secretary
at the beginning point of the recession, it was really essential that all the
agencies under the Cabinet would operate as efficiently as possible," says Jill
Hanken, a staff attorney with the Virginia Poverty Law Center. "She was involved
in delicately using the scalpel to cut programs for fiscal reasons. But at the
same time, there were some important steps forward in terms of prenatal care,
protection of safety net programs for the uninsured, and improvements for foster
care children."
Terry Dickinson, executive director of the Virginia Dental Association,
credits Tavenner with helping to get a measure through the Legislature allowing
dental hygienists to take on some of the responsibilities of dentists in
delivering care in medically underserved, impoverished parts of southwestern
Virginia. Tavenner met with dentists in the Virginia Dental Association's house
of delegates to address their concerns about the measure. "She understood the
political reality of how we needed to walk that line," Dickinson recalls. "You
have to think about the big picture, and how do you get health care to these
folks," Dickinson recalls Tavenner as saying. "She just had a great way of
talking with the group."
And Tavenner managed turf wars skillfully in world of hospital politics, says
Jay Grinney, CEO of the rehabilitation chain HealthSouth. In a HealthBeat
profile of Tavenner in May, Grinney said that when he first became Tavenner's
boss at HCA she was the CEO of Chippenham hospital in the southern part of
Richmond, Va. He put her in charge of creating a merged doctor network with
HCA's nearby Johnston-Willis facility. The two facilities had different medical
staffs, cultures, and markets. Company insiders doubted she could pull it off.
But Tavenner worked through the issues and successfully brought together the two
sites, Grinney says.
4. Allegedly, when she worked for Virginia Gov. Tim Kaine, they
suppressed the findings of a Virginia state task force report saying that 800
kids in state-run psych facilities wouldn't have treatment options close to home
if the state followed through on a plan to close the facilities. Then she
wouldn't talk more about the issue with the press. Is that going to cause her
confirmation trouble? What does it say about her management style?
If Republicans want to make trouble for Tavenner in a confirmation hearing,
it's logical that they will ask about the handling of the task force report.
"What happened with the Commonwealth Center really, I think, caught people
off guard," Mira Signer, executive director of the Virginia branch of the
National Alliance for the Mentally Ill, said in the profile of Tavenner earlier
this year. Advocates scrambled to keep the facility from being shut down, and it
remained open.
Tavenner backers typically draw a blank when asked about the task force
report, which appears to be an anomaly in a career noted for concern with
promoting access to care. Does it reflect a closed way of doing business? "In my
dealings with her, she was pretty transparent," says Hanken, who describes
Tavenner as having had "an open-door policy."
5. What about morale at CMS? People say Berwick really fired up the
troops with his vision that improving quality is a way to lower costs. Will
Tavenner have the same impact?
Tavenner has earned much staff goodwill during her tenure at the agency, CMS
insiders say. Tavenner too appears to be a motivator, although no one is likely
to match Berwick's particular brand of charisma.
Swennsen says, "The attitude and the atmosphere that I felt within the
hospital was a very functional one. The hospital and the doctors for the most
part got along, and the nurses did, and they were very attentive to what the
patients needed." There was a feeling "throughout the hospital that we had good
management, that if we had a problem we could go to Marilyn and she would take
care of it. There wasn't any ideology. There weren't any personal issues. It was
just a very clean way to do business. And it was very effective."
6. Would Tavenner bring her own people with her to fill management
slots? Should we expect other top people at CMS to leave after Berwick's
departure?
Tavenner has been in Washington now for more than 18 months, so don't expect
anything big anytime soon. Berwick devotees say they are committed to staying
and carrying on the work he has started at the agency. Some changes in the
administrator's office seem inevitable at some point. But don't expect any big
shakeup in the wider agency.
7. Tavenner oversaw a state Medicaid program, something unusual for
the top CMS official. How much difference is that going to make in running the
agency?
"It's great to have somebody in that broader role who knows Medicaid," said
Matt Salo, executive director of the National Association of Medicaid Directors.
Salo said Tavenner's state experience could help ensure Medicaid is "viewed as
just as important as Medicare when thinking about the big picture."
Among pressing issues for the program is how to move a care improvement
agenda in an era of tight budgets at both the state and federal level. That will
involve a change in culture, Salo said, to provide greater focus on innovating
and outcomes rather than process and paperwork. Movement in that direction often
is slowed by the constant tensions between state and federal administrators, he
said. Tavenner will understand the dynamic from both sides.
Former Medicare and Medicaid administrator Gail Wilensky, now a senior fellow
at Project HOPE, agrees, saying Tavenner "is likely to be especially sensitive
to the issues and sometimes frustrations that states historically have had with
the agency," including "timeliness or lack thereof" on decisions relating to
waivers and other issues. Diane Rowland, executive director of the Kaiser Family
Foundation's Commission on Medicaid and the Uninsured, said Tavenner's
experience also will help in establishing state-based aspects of the health care
overhaul. "It will help her to have a grasp on the state challenges as health
reform is implemented," Rowland said.
8. A lot has been said about Berwick's vision and ideas. What about
health care is Tavenner most passionate about?
Unlike Berwick, Tavenner doesn't have a signature set of specific issues that
she has championed. Those who have worked with her talk about her unwavering
commitment to patient care and to ensuring that patients have access to the care
they need and that providers are paid in a way that promotes that access.
"She's a pragmatic person who wants to make things work and has patients at
heart," Debbie Oswalt, executive director of the Virginia Health Care
Foundation, told HealthBeat in May. (See related story, CQ HealthBeat, May 31,
2011).
9. How are health industry stakeholders responding to the Tavenner
nomination?
So far, so good for Tavenner. In fact, some of the reaction was nearly
ecstatic.
Chip Kahn, president and CEO of the Federation of American Hospitals, said
she has served "skillfully and with distinction" as deputy administrator. "Ms.
Tavenner's successful career is characterized by her willingness to go the extra
mile and to reach across the aisle to achieve results. She is an ideal candidate
to head CMS, and we encourage the Senate to approve her nomination quickly,"
said Kahn.
Tavenner is a former hospital chief executive and president of the Virginia
Hospital Association, and she spent 10 years in executive-level positions with
the Hospital Corporation of America.
Rich Umbdenstock, president and CEO of the American Hospital Association,
where Tavenner has served as a board member, said she is a "very capable
administrator" with a varied and rich background. "We have no doubt that she
will provide strong leadership in these challenging times," he said.
The doctors like her, too. The American Medical Association issued a
statement strongly supporting her.
"We have worked extensively with her in her role as deputy administrator, and
she has been fair, knowledgeable and open to dialogue," said Peter W. Carmel,
AMA president. "With all the changes and challenges facing the Medicare and
Medicaid programs, CMS needs stable leadership, and Marilyn Tavenner has the
skills and experience to provide it."
Those representing skilled-nursing facilities (SNFs) praised Tavenner's
understanding of the connections between Medicare and Medicaid when it comes to
delivering quality care to residents of nursing homes. That came when she was
health secretary in Virginia, they said.
"Marilyn Tavenner is a strong choice to lead CMS because of her reputation as
a smart, competent administrator, and because she has a strong working knowledge
of how Medicare and Medicaid funding adequacy are both integral to the ongoing
ability of SNFs to provide high quality long term and post-acute care to U.S.
seniors," said Alan G. Rosenbloom, president of the Alliance for Quality Nursing
Home Care.
10. What about Berwick's future?
Right now, no one seems to know what his plans are. Or at least they're not
saying. When he announced his resignation last week, Berwick did not address his
future. Those close to him at the agency said he was expected to return to his
home in Boston and spend time with his family before deciding his next move.
Rumors are rampant that Berwick ultimately may stay at HHS in a
non-political, technical position, either in the secretary's office or at the
Center for Medicare and Medicaid Innovation. The Institute for Healthcare
Improvement, where Berwick was CEO and president before moving to CMS last year,
is referring press calls back to CMS, at least until after he leaves office
Friday.
IHI's CEO and president, Maureen Bisognano, said in an email that she is
confident Berwick will continue to contribute to the national agenda of
redesigning health care delivery and financing. "That is his life's work,
mission and passion," she added.
Kaiser's Rowland expects Berwick will be very much in demand. Many places
respect him, she said, and would want him, and he's "very committed to seeing
things through." Rowland is sure he will "continue to be an advocate for these
reforms."
Corporate Greed Puts Profits over Safety: Pfizer Inc. is Moving into Retail
In an effort to hold onto sales of cholesterol fighter Lipitor after the drug loses patent protection at the end of this month, Pfizer is planning to sell the pills at generic prices directly to patients, breaking a longstanding triad between the patient, prescriber, and pharmacist, which provides a system of checks and balances for delivering medication therapy, The Wall Street Journal recently reported.
Lipitor, the top-selling drug of all time, has made Pfizer more than $81 billion in sales since launching in 1997, according to IMS Health. At its peak, more than 11 million Americans took it, says Wolters Kluwer Pharma Solutions, another health-care data firm.
Because most patients see multiple prescribers, when a patient uses a single pharmacy the risk of drug errors is reduced substantially. By interjecting a Pfizer Pharmacy for a single drug, at least one leg of the triad is undermined creating the risk of duplicative therapy since neither the plan's nor the pharmacy's records would be complete for the patient.
In letters to pharmacists last week, PBMs instructed pharmacies to continue dispensing brand Lipitor for the next 6 months. This reversal of business as usual reflects new tactics by Pfizer to keep sales afloat as generic competition threatens its blockbuster drug. Pfizer has agreed to large discounts for benefit managers that block the use of generic versions of Lipitor, according to a letter from Catalyst Rx, a benefit manager for 18 million people in the United States. The letters have not previously been made public.
Earlier this year, Pfizer, Inc attempted to circumvent Medicare Part D formulary regulations by offering generous rebates to PBMs to block the addition of generic Lipitor, atorvastatin, and place the brand name on a preferred tier. Part D Plans are prohibited from making formulary decisions based on financial incentives to the Plan or its delegated entity, the PBM.
Dave Marley, RPh, founding member of the group and author of a Pharmacy Times blog about bringing accountability to the PBM industry, told NYT that employers and taxpayers will bear the brunt of excess costs under the new arrangement—even as PBMs pocket Pfizer's rebate dollars.
To offset the expense of dispensing Lipitor instead of its generic equivalent, which would cost payers roughly $35 less, Pfizer is offering benefit managers a point-of-sale discount that undercuts the generic price. As a result, most patients taking Lipitor will see their co-pays drop to about $10 per prescription, the New York Times reported. The block on generic Lipitor is scheduled to lift on May 31, 2012, when several other generic drug makers are expected to launch their versions of the drug.
The Impact of the Sequester on Private Plans
Medicare Advantage (MA) plans and Part D plans are slated for a 2 percent cut beginning in FY 2013 now that the Super Committee has failed to recommend any changes that cut the deficit. This is probably a better deal than private plans would have faced if $1.2 trillion in cuts were recommended and adopted. The Part D cuts will affect the direct subsidy and not low income subsidies or reinsurance. We would expect plans to submit higher bids next year to make up the difference. MA plans that include drugs will have a double hit. Even though the Budget Control Act specified that beneficiary cost sharing would not be impacted by a sequester, the reality is that plans will increase premiums and out of pocket costs paid by enrollees. If fee for service providers increase volume to offset their 2 percent cut, then Medigap plans will pay more and their costs will also increase.