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We summarize the recent activity from the legislative and executive branches regarding the opioid crisis.

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Mar. 2, 2018

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FEATURED STORY
 

All Together Now: Various Options Discussed for Opioid Crisis

 
 

This week saw a lot of activity on the opioid crisis in both the legislative and executive branches. Both the House of Representatives and the Senate held hearings on the crisis, and the Senate introduced the Comprehensive Addiction and Recovery Act (CARA) 2.0 legislation. Down the street, the Department of Justice (DOJ) held a press conference announcing new efforts, and the White House held a summit on opioids.

On Tuesday, the Senate Health, Education, Labor, and Pensions (HELP) Committee held its fifth in a series of hearings on the opioid crisis. The hearing focused on the role that technology and data have in preventing and treating opioid addiction. Witnesses included representatives from Express Scripts, the National Alliance for Model State Drug Laws, and professors of public health and health informatics. The importance of e-prescribing wherever possible was repeatedly raised as a way of restricting pharmacy and doctor shopping, enabling better prescription tracking, and reducing fraud, waste, and abuse.

Tuesday also saw the release of bipartisan legislation from the Senate on an update to the CARA signed into law in 2016. Known as “CARA 2.0,” the legislation proposes a 3-day limit on initial opioid prescriptions for acute pain and allows physician assistants and nurse practitioners to prescribe buprenorphine, a medication-assisted treatment (MAT) to help people reduce or quit their use of opiates. The legislation would also allow states to waive the limit on the number of patients a physician can treat with buprenorphine (currently capped at 100 patients per physician) and require prescribers to use state prescription drug monitoring programs (PDMPs). It looks to increase civil and criminal penalties on opioid manufacturers that do not adequately control diversion. The bill has funding for educational campaigns, training on naloxone, and expanding the evidence base for MATs. Mark-up on the bill is expected later this month.

On Wednesday, the House Energy and Commerce Subcommittee on Health held a legislative hearing titled, “Combating the Opioid Crisis: Helping Communities Balance Enforcement and Patient Safety.” The hearing covered a wide array of proposals and featured 2 panels of witnesses to discuss pending legislation. Questions focused on the need for disposal information and options, over-prescribing, physician education, coordination between state licensing entities, and the need for the Drug Enforcement Agency (DEA) to provide input on congressional legislative efforts.

Not to be outdone by congressional efforts, earlier this week, Attorney General Jeff Sessions, joined by the Acting DEA Administrator, 7 State Attorneys General, and Opioid Coordinator Mary Daly, held a press conference to highlight the Administration’s ongoing efforts to stem the opioid crisis and announce new efforts to “reduce these overdose deaths, to reduce addiction, and to reduce the amount of prescription opioids that are available in our country today.” Part of the announcement included the creation of a Prescription Interdiction and Litigation Task Force (PIL Task Force). This unit will coordinate with states and the Department of Health and Human Services (HHS) and review state lawsuits to determine where the DOJ’s involvement can be useful.

More opioid-related news came out on Thursday with a story from Politico indicating that Senate Democrats asked the US Government Accountability Office (GAO) to investigate the Trump Administration’s steps to combat the opioid epidemic. The story came out the same day the White House hosted a summit on the opioid epidemic. With the activity this week, we are seeing more of a response to what most agree is a national emergency, but the coordination is still not there yet to call it a coordinated response.

 

Xcenda Examines the Impact of the Tax Cuts and Jobs Act on the Life Science Sector

 
 

The Tax Cuts and Jobs Act (TCJA), which was signed into law on December 22, 2017, is of particular interest to the life science investment community. Described as a windfall for corporate tax infrastructure and the most far-reaching piece of tax legislation enacted in the US since the Tax Reform Act of 1986, the TCJA highlights the potential for US companies to repatriate their liquid foreign subsidiaries at a lower tax rate.

Xcenda’s latest issue brief, “Life Science Investing During the US Tax Reform Windfall: Key Insights to Guide Smart Decision Making,” takes a look at the mergers and acquisition activity in the life science sector as a result of the act and provides key insights for investing in the sector. Learn more

 

 

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REGULATORY UPDATES
 

What Happens if You Remove X From X + Y = Z?

 
 

Twenty Republican-leaning states are suing the federal government to block implementation of the Affordable Care Act (ACA), this time over the repealed individual mandate tax penalties. The states argue that without this core provision of the ACA, the entire law is invalid.

On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act of 2017 that repealed the tax penalty of the ACA’s individual mandate—but not the mandate itself. The states in the lawsuit point out the mandate was upheld by the Supreme Court in 2012 by declaring it a constitutional tax essential to the law; however, without the tax penalties inextricably intertwined with the individual mandate, they deem the mandate is now an “unconstitutional command from the federal government to individuals to purchase a product.” Therefore, they believe since the mandate is essential to the ACA’s operation, the entire law should be enjoined. The states also highlight that since the ACA has no severability clause to prevent the law to stand if the courts struck down one part, the rest is invalid.

States filing the suit include Alabama, Arkansas, Arizona, Florida, Georgia, Indiana, Kansas, Louisiana, Maine, Mississippi, Missouri, Nebraska, North Dakota, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia, and Wisconsin. They ask the court to rule the ACA unconstitutional under the taxing authority, as well as under the 5th and 10th Amendments, and seek an immediate injunction.

Even if changes come of this exercise, it is worth mentioning that the individual mandate penalty will not go away until 2019, so most Americans will still will owe Uncle Sam if they did not have health insurance and do not qualify for an exemption.

 

Badgers Waive, Policy Wonks Go Wild

 
 

On Tuesday, Wisconsin Gov. Scott Walker (R) signed Senate Bill 770 authorizing the state to pursue federal approval to create a state-based reinsurance program to help stabilize premiums in the individual health insurance market. State officials estimate the reinsurance program will lower healthcare premiums for those in the individual market by 13% in 2019 and 12% in 2020.

The state will apply to HHS for a section 1332 waiver to create the program. Gov. Walker sent federal lawmakers a letter supporting efforts that would accelerate the 1332 waiver process.

Section 1332 State Innovation Waivers were included in the ACA to allow states to pursue innovative strategies to ensure residents have access to affordable health insurance options. Given the uncertainty and instability of federal efforts on healthcare, we have seen more states take the lead implementing changes ranging from reinsurance to drug-pricing transparency. Expect more to come.

 

Ditch the MIPS and Amp the APMs

 
 

On Monday, Health Affairs published a blog post urging Congress to replace Medicare’s Merit-Based Incentive Payment System (MIPS). The authors, who come mostly from the Brookings Institute, argue MIPS will fail to improve patient care while creating a substantial administrative burden to providers and the Centers for Medicare & Medicaid Services (CMS). The post echoes the recent Medicare Payment Advisory Commission’s recommendation to eliminate MIPS but proposes different plans of action.

One flaw of MIPS’ design is the breadth of measures and activities on which they are evaluated. The broad array of choices “seriously undermines MIPS’ effectiveness” because each clinician will end up reporting different measures, thus complicating MIPS’ ability to help patients compare clinicians.

Another fundamental flaw of MIPS explored by the authors is that many practices participating in MIPS are so small that cost performance is based on a small sample size, resulting in chance playing a larger role in the scores than improvement or efficiency. Unfortunately, this problem will only be exacerbated as CMS increases the number of cost measures it uses in MIPS.

MIPS may also discourage practices from participating in advanced Alternative Payment Models (APMs), the Medicare Access and CHIP Reauthorization Act (MACRA) alternative to MIPS, because the potential bonus for MIPS is larger than for APMs. Providers who would do well in an APM are already doing well on measures and activities that input into the MIPS program.

The authors provided a 2-pronged approach to improve advanced APM participation once MIPS is eliminated. Recommendation 1 involves expansion and improvement of incentives for participation in advanced APMs by increasing the incentive through the following approaches:

  1. Using a combination of additional bonuses and penalties
  2. Providing incentives for new categories of providers such as hospitals
  3. Making APM bonuses permanent beyond 2022
  4. Smoothing out the cliff in eligibility criteria for advanced APM bonus by phasing in the bonus or adopting a tiered payment structure

Recommendation 2 centers on the creation of targeted incentives for clearly defined, high-value activities such as the use of the latest certified electronic health records and reporting of clinical data via registries.

Whether Congress will revise MIPS is unknown, but providers who continue to participate in that payment system may not see as big of a bonus as they expect, and the administrative burden will continue. Manufacturers should stay abreast of any potential update to MIPS or APMs and keep a pulse on any clinically relevant measures for their products that are currently in, or may be introduced into, both programs.

 

Nerding Out: Economists Find Success. In Bundled Payments

 
 

A study published by the National Bureau of Economic Research explores how physicians respond to financial incentives imposed by episode-based bundled payments (EBP); these models are designed to encourage lower spending and improved quality for an entire episode of care.

The study looked at the Arkansas Health Care Payment Improvement Initiative (AHCPII), a multi-payer program requiring providers to enter into EBP arrangements for perinatal care. The analysis showed that perinatal spending decreased by 3.8% overall in Arkansas after the introduction of EBP, compared to surrounding states. The researchers found that reduced spending on non-physician healthcare inputs, specifically the prices paid for inpatient facility care, drove the decrease. Additionally, EBP was associated with a limited improvement in quality of care.

Unlike fee-for-service reimbursement, EBP rewards physicians not only for efficient use of their own services but also for efficient management of other healthcare items and services. The Holy Grail for EBP is the demonstration of lower costs and higher quality. Though the magnitude of AHCPII’s improvement is relatively minor, the trends for both goals are positive.

 

Proving There Is More Than One Way to Undermine the ACA

 
 

A new analysis by the Urban Institute expects declining enrollment and rising premiums for ACA exchange plans, based on the Administration’s most recent directives.

Last week’s proposed rule concerning Short-Term, Limited-Duration (STLD) health plans would expand coverage to 12 month for plans that do not meet the ACA’s standard for essential health benefits. Only a handful of states have any prohibitions on the expansion of STLDs health plans. The Urban Institute projects the following impact in 2019 of less stringent STLD health plans and the recent repeal of the individual mandate:

  • Result in 2.5 million enrollees dropping out of ACA exchange plans
  • Raise ACA premiums an average of 18.2%
  • See 4.2 million new enrollees in STLD plans

However, CMS only expects 100,000 to 200,000 enrollees to drop their ACA exchange plan coverage in 2019 and enroll in STLD plans.

The Blue Cross Blue Shield Association and the America’s Health Insurance Plans trade group have penned strong opposition to STLD expansion. They believe many healthy enrollees, willing to take more risk or unaware of the lack of ACA protections, are likely to opt for the less expensive STLD plans, thereby necessitating premium rate hikes for the remaining exchange plan enrollees.

Providing more options and more choices while reducing regulations and cost for Americans is at the core of the Administration’s latest initiative, as explained by HHS Secretary Alex Azar. “More broadly, this Administration believes that a competitive, affordable insurance market is going to come about by allowing insurers to respond to consumers—not by imposing edicts from Washington.”

 

Information Buffet (AKA, Other Stuff That Caught Our Attention)

 
 

We kept running into stories we wanted to bring to your attention, so here’s a quick hit list of other news we thought you should know:

 

CBI 119th Annual Patient Assistance & Access Programs Conference

 
 

March 6–7 l Baltimore, MD

Join leaders from AmerisourceBergen companies, Xcenda and Lash Group, at CBI’s 19th Annual PAP Conference in Baltimore. Ana Stojanovska, Vice President, Reimbursement & Policy Insights, and Teri’ Burnell, PharmD, Senior Vice President, Field Support, both from Xcenda, will host the Opening Luminary Address on “The Changing Landscape of Healthcare Coverage and Access.” Lash Group president, Tommy Bramley, PhD, will present the Keynote Address on “Pioneering to New Grounds in Patient Access—Rewriting the Playbook for Patient Programs.” Learn more

 

 

 

 
HEARD ON THE STREET
 

“[Under many contracts,] the pharmacist cannot volunteer the fact that a medicine is less expensive if you pay the cash price and we don’t run it through your health plan.”

 

Source: “Why Your Pharmacist Can’t Tell You That $20 Prescription Could Cost Only $8,” The New York Times, February 24

 
POLICY BY NUMBERS
 

5

 

Hepatitis C antivirals comprised 5 of the 10 biggest drug launches in the last 20 years. Rounding out the list were 2 COX-2 inhibitors, a muscular sclerosis therapy, an HIV antiviral, and a CDK 4 & 6 inhibitor for breast cancer.

Source: “The Biggest Drug Launches—Hep C Dominates but Tecfidera Stands Out,” EP Vantage, February 21

 
UPCOMING MEETINGS & CONFERENCES
 

CBI 19th Patient Assistance and Access Programs Conference

March 6–7 l Baltimore, MD
Join leaders from Xcenda and Lash Group at the 19th PAP Conference in Baltimore. Ana Stojanovska, Vice President, Reimbursement & Policy Insights, and Teri’ Burnell, PharmD, Senior Vice President, Field Support at Xcenda, will host the Opening Luminary Address on “The Changing Landscape of Healthcare Coverage and Access.” Tommy Bramley, PhD, President of Lash Group, will present the Keynote Address on “Pioneering to New Grounds in Patient Access—Rewriting the Playbook for Patient Programs.” Learn more

 

AMCP Managed Care & Specialty Pharmacy Annual Meeting

April 23–26 l Boston, MA
Join AmerisourceBergen companies, US Bioservices and Xcenda, at AMCP’s Annual Meeting at the Boston Convention and Exhibition Center April 23–26. Meet with our specialty pharmacy and commercialization experts at the largest gathering of managed care professionals who work, lead, and innovate in the ever-changing world of pharmaceutical management. Visit AmerisourceBergen at booths 316 and 321. Learn more

 

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Count on Health Policy Weekly for an at-a-glance view of legislative and regulatory developments and news that impacts the healthcare industry.

 
 
 
 

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FEATURED CONTRIBUTORS
 

EDITOR-IN-CHIEF:
Jennifer Snow
Senior Director,
Health Policy
Xcenda

MANAGING EDITOR:
Scott Shields
Associate Director,
Health Policy
Xcenda

 

ADVISORY BOARD:

Peyton Howell, MHA
Executive Vice President & President, Health Systems & Specialty Care Solutions | AmerisourceBergen Corporation

Amy Grogg, PharmD
Senior Vice President | Strategy & Commercialization | AmerisourceBergen Corporation

Kristine Flemister, PharmD
President | Xcenda

Tommy Bramley, PhD, RPh
President | Lash Group

Stacie Heller
Vice President | Government Policy | AmerisourceBergen Corporation

Rita Norton
Senior Vice President | Government and Public Policy | AmerisourceBergen Corporation

Ana Stojanovska
Vice President | Reimbursement & Policy Insights | Xcenda

CONTRIBUTING AUTHORS:

Milda Kaitz | Scott Shields | Diane Smith | Jennifer Snow | Stephen Wilson 

PRODUCTION:

Laurie Kozbelt | Ellen Olson

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Mar. 2, 2018

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