Thursday, May 14, 2009

Mid-week miscellany

  • The Senate Finance Committee held a closed meeting today on its white paper about expanding health care coverage. Modern Healthcare reports that “'There are a lot of questions, not a lot of concrete answers,' committee Chairman Max Baucus (D-Mont.) told reporters after the 8-1/2 hour 'walkthrough.' But the senator also said that the purpose of the meeting was to spur conversation, not hammer out a deal." Meanwhile the Washington Post reports that House Republicans have asked for a health care reform meeting with President Obama. And Reuters reports that John Lechleiter the CEO of drug manufacturer Lilly advised that
    some proposals under discussion in Congress "will have unintended side effects" that could discourage development of new medicines. "The encouragement of innovation does not even seem to be on the table in today's policy discussions," he said. Lechleiter said allowing Medicare to negotiate drug prices and having the government offer its own insurance plan to compete with private insurers could be harmful.
    I agree that the current rush to health care reform could wind up impairing innovation.
  • Prescription drug benefit manager Medco issued its 2009 Drug Trends report.

    As predicted, specialty drug trend accelerated dramatically, from 12.4% in 2007 to 15.8% in 2008. In addition, the price inflation of branded pharmaceuticals increased more than 8%. Despite these trends, Medco clients in 2008 realized an average drug trend of 3.3%—a small increase from our all-time low in 2007.

    Among the insights revealed in this year’s report:

    • The weak economy drove renewed interest in generics, as the generic dispensing rate increased 4.4% to 64.1%.

    • About 30% to 40% of the medicines currently in the pipeline are specialty drugs, with nearly 25% of those targeting very rare conditions.

    • Biologic or protein-based drug therapies account for about 16% of prescription drug spending and are growing at a much faster rate than other drug categories.

    • Branded drug price inflation and unit-cost growth will be moderated by the wave of first-time generics in high-cost categories, which is expected to peak after 2011.
    It's always fun reading. And while on the topic of PBM's, Business Insurance reports that CIGNA may tear a page out of Wellpoint's playbook and sell off its own PBM. Aetna and United Healthcare also have their own PBMs.

  • Finally, AHIP released its annuals census on health savings account owners. The census disclosed that "Eight million Americans are covered by Health Savings Account (HSA)-eligible insurance plans, an increase of more than 31 percent since last year." AHIP also released a report on the income characteristics of HSA owners. According to the AHIP press release,

    Key findings from the census include:

    There was an increase of approximately 1.9 million Americans enrolled in an HSA plan since January 2008. Previous AHIP census reports found that 6.1 million were enrolled in January 2008, 4.5 million were enrolled in January 2007, 3.2 million were enrolled in January 2006, and 1.0 million were enrolled in March 2005.

    30 percent of individuals covered by an HSA plan were in the small group market, 47 percent of individuals covered by an HSA plan were in the large-group market, and the remaining 23 percent were in the individual market.

    A majority of HSA enrollees are covered by Preferred Provider Organization (PPO) products (83 percent) and Health Maintenance Organization (HMO) products (10 percent). In the individual market, almost 92 percent of enrollees in HSA plans were in PPO products, while approximately 85 percent of enrollees in large-group and 76 percent of enrollees in small-group HSA plans were in PPO plans.

    States with the highest levels of HSA/HDHP enrollment were California (854,000), Florida (524,000), Illinois (497,000), Texas (476,000), Ohio (464,000), and Minnesota (388,000).

    Key findings from the income characteristics analysis include:

    Households with a wide range of incomes hold HSA accounts, with
    almost half (49 percent) of accountholders living in neighborhoods with median
    incomes under $50,000 (incomes based on 2000 Census data).

    Average total deposits (including personal deposits, employer contributions, and interest) for all HSA accounts were $1,634 and average total withdrawals
    (including fees) were $1,063.

No comments: