Happy Fourth of July

Happy Fourth of July to all!

The Towers Perrin actuarial consulting firm issued a report for multi-national employers this week on 2012 global medical trends. The FEHBP does cover people all over the world! The FEHBlog did not notice any surprises in the blurbs about the report which is available at the link.

The AMA News is crowing this week about the growth of physician-led accountable care organizations.  It's interesting to note (as did AHIP) that

Those working within the ACO model said private payers allowed for more flexibility. Participants in the Medicare shared savings program must have a minimum of 5,000 members and meet 33 quality measures in four domains. Those arranged with private insurers can be designed for lower numbers and different benchmarks.
For instance, PinnacleHealth System, a nonprofit health system based in Harrisburg, Pa., announced June 13 the formation of an accountable care organization with Capital BlueCross. The insurer will provide resources such as nurses to coordinate care and technology to analyze where cost savings could be achieved. Pinnacle is looking to establish more of these arrangements with other insurers in the area and has no plans to apply to a government program at the moment.
“The government has a very strict formula,” said Chris Markley, Pinnacle’s senior vice president of strategic services. “Capital BlueCross is more flexible, and it was a very collaborative process to set up.”

Ah, the benefits of market flexibility!

Now let's turn to health care fraud news. The Justice Department reported this week a False Claims Act settlement with Nextcare, an urgent care center owner in several states.  NextCare agreed to pay $10 million and enter into a corporate integrity agreement to settle (without admitting liability) allegations that its centers ordered unnecessary tests and upcoded certain services provided to FEHBP members, among others. The former Nextcare employee who blew the whistle by filing a False Claims Act lawsuit on the federal government's behalf and her lawyers will received $1.614 million.

The Washington Post reports that the prescription drug manufacture GlaxoSmithKline yesterday agreed to plead guilty to Food and Drug Act violations and pay the federal government $3 billion based on allegations that GlaxoSmithKline encouraged off-label use of its blockbuster antidepressant drugs Paxil and Wellbrutin. When the FDA approves a prescription drug for marketing it labels its approved uses based on the clinical studies. While doctors can prescribe the drug for non-approved uses in the exercise of sound professional judgment, the manufacturers cannot advocate such off label use. In this case, two False Claims Act whistleblowers and former Glaxo employees sued Glaxo for among other things advocating Paxil's use with children which was an unapproved use. The Post reports that

Starting in 2001, Thorpe [one of the whistleblowers] reported to his district manager, then to Glaxo’s human resources department and finally to Glaxo’s chief of global compliance about a number of improper marketing practices. The compliance chief began an internal investigation, which confirmed Thorpe’s allegations through various ways including marketing materials and interviews with Hamrick and other sales representatives, according to lawyers for the two men.

But the article goes on, Glaxo did nothing and so the whistleblowers sued. Their share of the recovery has not yet been determined. The size of this settlement is staggering and illustrates just how much money flows around in the health care system.