Sunday, November 04, 2018

Weekend Update

Congress is out of town until early next week following Tuesday's mid-term elections. The lame duck session will last until mid-December. 

On Friday, according to this NPR report, the Food and Drug Administration approved a potent new opioid, AcelRx's Dsuvia for marketing.  The drug should be available in hospitals early next year. AcelRx anticipates $1.1 billion in annual sales. 
Dr. Pamela Palmer, an anesthesiologist and co-founder of AcelRx, argues that the risk of diversion — when drugs end up with people who are not the intended patients — is low with Dsuvia because it will not be dispensed to patients at pharmacies. Instead, health care providers will only be able to use it in medical centers, she says, arguing that few people misuse drugs from those settings.
On the other hand,
"We may find a niche for [Dsuvia] but it's not like we need it, and for sure, at some level, it's going to be diverted," says Dr. Palmer MacKie, assistant professor at the Indiana University School of Medicine and director of the Eskenazi Health Integrative Pain Program in Indianapolis. "Do we really want an opportunity to divert another medicine?" 
Fair question.

The Wall Street Journal reports that the State of North Carolina is replacing its state employes' health benefit program's negotiated contract based preferred provider program (used in the FEHBP) with a take it or leave it contract arrangement paying a fixed multiple of the Medicare program's fee schedules beginning in 2020. The State expects the new transparent arrangement to save "around $300 million a year and workers an additional approximately $66 million annually, Mr. Folwell’s [the State Treasurer's] office said."

The state’s employee health plan has an annual budget of around $3.3 billion.
The effort faces serious challenges because of hospitals’ clout. In some parts of North Carolina, big systems of hospitals have large market share, while small towns may have only one hospital. The state may find it difficult to assemble a network of hospitals across the state willing to take its rates.
If hospitals refuse to accept the rates that Mr. Folwell wants, the state plan says it will simply not include them in its network of providers. Yet that could leave workers who use those hospitals exposed to huge bills, because hospitals might demand they pay full charges, without the discounts that insurers typically negotiate. 
Basing out of network coverage on a multiple of Medicare pricing is commonplace. This take or leave it approach, however, is bound to to shift costs onto other employer sponsored health benefits program in North Carolina with less negotiating clout. 

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