Weekend Update

Well, as we enter the second week of the Federal Benefits Open Season, Congress returns for its lame duck session and Medicare starts its annual Open Season for Medicare Advantage and prescription drug plans.

The Federal Times reports that

More than six weeks after the Oct. 1 start of the fiscal year, agencies are operating off a continuing resolution that generally leaves spending at fiscal 2010 levels. The [continuing] resolution [that Congress passed before the November 2 election] expires Dec. 3; the question is whether lawmakers will belatedly approve a dozen fiscal 2011 spending bills — possibly as a catch-all "omnibus" package — or punt a final decision into next year by passing another continuing resolution.

In addition to appropriations, Congress may consider the American Medical Association's request to keep the Medicare Part B reimbursement "patch" in effect through the end of next year. Absent Congressional action, Medicare Part B reimbursements will be cut by 23% on December 1.

Business Insurance reports that "Senate Finance Committee Chairman Max Baucus, D-Mont., said Friday that he will introduce legislation to repeal a[n Affordable Care Act] requirement that employers furnish 1099 statements if they do more than $600 in business with a corporate vendor." A similar effort failed in September.

The Hill reports that "An employer-backed group [called Save Flexible Spending Plans] is pressing the new leaders in Congress to alleviate restrictions placed on flexible spending accounts by the health reform law. The group is demanding that Congress delay or repeal the Affordable Care Act's requirement -- effective next year -- that flexible spending account (and group health plan) participants must obtain a doctor's prescription for over the counter drugs (except insulin) in order to receive plan reimbursement. The OPM presenters discussed this change in last week's webinar. According to the Hill, the group's chairman, Joe Jackson, "called the provision 'an utter waste of consumers' and physicians' limited time' that will only increase healthcare costs.

Speaking of drugs, Reuters reports that "The U.S. healthcare system will reap at least $70 billion in savings over the next four years as brand-name medicines become available as lower-cost generics."

The healthcare system has become ever more efficient at driving patients to generics. When a generic alternative is available, doctors prescribe it 93 percent of the time, up from 83 percent in 2003, according to IMS.

Among the high-profile drugs losing U.S. patent protection during the 2011-2014 period are the world's two top-selling medicines: Pfizer Inc's (PFE.N) Lipitor cholesterol treatment and the blood-clot preventer Plavix, sold by Bristol-Myers Squibb (BMY.N) and Sanofi-Aventis (SASY.PA).  Other widely sold medicines set to see generic competition include Eli Lilly's (LLY.N) Zyprexa schizophrenia drug and Merck's (MRK.N) Singulair asthma treatment.

In contrast to low priced generics, the New York Times reports about a

controversial review by the Centers for Medicare and Medicaid Services [CMS] to determine whether to pay for Provenge, which costs $93,000 per patient and extended lives by about four months in clinical trials. Medicare advisers will meet next Wednesday  [November 17] to discuss the drug, which was developed by Dendreon, a Seattle-based biotechnology company.

Provenge is the first so-called therapeutic cancer vaccine – meaning it works by training the patient’s immune system to attack the tumor – to win F.D.A. approval. The treatment is made for each patient from his own blood. Sales have been small so far because Dendreon’s manufacturing capacity has been limited.

A Washington Post report predicts that the CMS review panel will approve Medicare coverage of Provenge. According to the Post, "most private insurers already pay for Provenge, and Medicare patients can receive it while the government conducts its review."