Payers, technology providers, and policy experts are convening in Las Vegas for the annual HIMSS fest to discuss how IT will enable new delivery models and payment reforms that are supposed to improve quality of care and lower costs. The experts are just hoping that what happens in Vegas –from the secure transfer of patient data via iPads and smart phones to the latest technology enabling health information exchanges—won’t stay in Vegas. Meantime, here’s a look at the top reimbursement-related news of the past week.
ICD-10: Better Late Than 2013? One topic that is top of mind for HIMSS attendees: Health and Human Services’ decision last week to delay implementation of ICD-10, more specific coding rules designed to reduce fraud and abuse and ease the sharing of health data with agencies outside the US. The new system – boosting the number of procedure codes from 14,000 to 180,000 — was due to come into force in October 2013. Now it’ll be later than that, though how much later is unclear.
Never mind that most of Europe has already implemented ICD-10 and that ICD-11, a more updated set of codes, is due to roll out in 2014; US providers simply aren’t ready for a change that is costly both in terms of time and administrative upgrades. For months, the American Medical Association has been calling for Congress to delay the mandated roll-out, arguing doctors are already struggling to comply with federal initiatives like electronic medical record adoption. Now HHS has answered those calls, announcing on February 16 that it “will initiate a process to postpone the date by which certain healthcare entities” must comply with ICD-10.
The statement provides more questions than answers: precisely how long will be the delay? Who are those ‘entities’, and do they include big hospital practitioners, or only small physician groups and solo practitioners?
Meanwhile, there are some who argue ICD-10, which physicians have called overly bureaucratic, is so outdated –it’s built on practice patterns from the 80s and 90s– that it would be better to bypass it and go straight to ICD-11. Given the billions already sunk into ICD-10 readiness, that ain’t likely to happen.
ICD-10 isn’t without supporters, who argue the increased specificity means policy makers and care givers[can understand at a very detailed level the care Americans are seeking. That’s data that could someday be used to allocate our precious—and dwindling–healthcare dollars. In the interim, for product makers ICD-10 may still be the gift that keeps on giving. Even with a delay in its implementation, payers and providers are so focused on the coming changes there isn’t a lot of time and energy to devote to the kinds of IT changes required to design and track new mechanisms like bundled payment initiatives. And by the time payer chief information officiers have ICD-10 sorted, it will be time for? You guessed it: ICD-11.
- Read the HHS release here.
- Here’s an official statement by the American Medical Association.
- The Wa-Po’s take on the ICD-10 delay.
- A Real Endpoints’s post from December 2011 on ICD-10.
AZ delivers Arimidex Direct to Patients: On February 16, AstraZeneca announced patients can opt to have the breast cancer medicine Arimidex, which went generic in 2010, delivered directly to their homes for a $40 monthly fee. This is less than patients would pay for the brand – it retails on Drugstore.com for almost $460 — but is more than the typical $10 co-pay it would cost for generic anastrozole. Mainstream media stories compared the move to Pfizer’s scheme to put branded Lipitor in the hands of patients via a $4 co-pay card. In both cases, the underlying premise is to improve market access of a genericized drug; still there are differences. For starters, AZ isn’t using a co-pay card; patients have to pay the entire $40 out-of-pocket. That’s a big difference – and it is also a wildcard. Will patients opt to pay for the medicine themselves when they can get anastrozole for $30 cheaper? Given Arimidex is typically prescribed to post-menopausal women, the decision not to adopt a co-pay strategy makes sense; it’s a fair bet many in this population get their insurance from Medicare, which prohibits the use of co-pay cards. Also noteworthy: the Lipitor co-pay card was instituted to preserve near-term revenues and allay investor concerns. With 96% of the market already using generic aromatase inhibitors, AstraZeneca isn’t preserving much revenue. According to Reuters, the drug only sold $42 million in 2011.
So why is this mail program, which requires a specialty contract with the PBM Express Scripts, worth the effort? AZ gains experience with a direct-to-patient service that could be very valuable when more important drugs –think Crestor or Nexium or Seroquel—lose patent protection. And those patent expiries are coming very soon.
- See here for the AZ release.
- Here’s the Reuters take on the news.
- See ”The Pink Sheet” DAILY for more. ($)
Stop Overtreatment and Cut Costs: News flash! The American College of Physicians is establishing guidelines to help providers better identify when they should screen for specific diseases –and when they shouldn’t. While medical centers across the country are establishing evidence-based guidelines tied to costly tests like CT scans or electrocardiograms, ACP’s efforts could influence doctors across the country. Dr. Steven Weinberger, CEO of ACP, told Reuters “excessive testing costs $200 billion to $250 billion” per year. Among his highest priorities: establishing guidelines on when to perform various diagnostic tests that will hopefully curb unnecessary follow-on procedures. In an article published in the January issue of the Annals of Internal Medicine, ACP identified nearly 40 clinical settings where screening didn’t help patients –and might actually have hurt them. These include coronary angiography in patients with chronic, stable chest pain, and MRIs for lower back pain. How could such guidelines impact product makers? At the outset look for device makers to get hit the hardest, since costly procedures like angioplasty or spine surgery often result from tests gaining closer scrutiny by ACP.
Thinking beyond the drug to delivery: A novel drug delivery implant could reduce costs and improve adherence if initial results bear out in larger studies. In conjunction with last week’s AAAS meeting and a publication in the journal Science Translational Medicine, a team of researchers from Harvard, MIT, Case Western Reserve and the med-tech firm microCHIPS announced results from the first human trial of an implantable drug delivery device capable of delivering 20 days worth of the osteoporosis medication Forteo. To create their implant, the researchers, which include renowned scientists Michael Cima and Robert Langer, hooked together two thumbnail-sized chips, each measuring just half an inch long by one-fifth an inch wide, to create a device capable of delivering the drug, which is normally injected once daily. Eight women with osteoporosis (who were otherwise healthy) were the first to receive the implant via a standard outpatient procedure. The device worked in seven of the eight patients, delivering a total of 132 doses of drug and validating design features including on-command delivery. Importantly, patients could not feel the device and were willing to repeat the procedure for further dosing.
For the implant to be used in a real world setting, some upgrades will need to occur, however. The device has built-in-diagnostics that track if a drug has been given correctly; but that transfer of information doesn’t occur in real time and must be uploaded by a caregiver or physician. In the future, execs from microCHIPS envision the device will be linked to a cellular network, allowing the results to flow seamlessly to a database or electronic medical record that could flag potential problems. In addition, the company now needs to test a higher density chip that could deliver a year’s worth of drug instead of just 20 doses.
- The NYT piece can be found here.
- The results were originally published in Science Translational Medicine.
- An accompanying editorial outlines some of the pitfalls of device innovation.