Although the ACA is still the law of the land-despite being somewhat dismantled, other healthcare policies continue to take shape and are being implemented. Here, healthcare experts detail three policies that MCOs will want to keep a close eye on.

Short-term Limited Duration Coverage Final Rule

: The Department of Health and Human Services, Labor, and Treasury issued a 

 that lengthens the time period that short-term, limited-duration health plans can remain effective from three months to three years. The August 1 ruling was developed in response to an executive order by President Trump in October 2017 that directed the federal government to expand access to short-term plans, association health plans, and health reimbursement arrangements, says Susan Feigin Harris, JD, partner at the law firm Morgan Lewis.

Short-term plans are intended to fill gaps in coverage that may occur when an individual is transitioning from one plan or coverage to another one, such as being in between jobs or needing coverage outside of an enrollment period, Feigin Harris says. These plans are exempt from federal market requirements that are applicable to health insurance sold on the exchange, because they aren’t considered health insurance.

: Although some states requested a delay in implementation to allow them to put certain protections in place, “CMS appears to have ignored this request, as the rule becomes effective 60 days after publication in the Federal Register,” Feigin Harris says.

: As a result of the final rule, short-term, limited-duration health plans can now be offered for 12 months at a time with renewals that do not exceed 36 months. “Short-term issuers can charge higher premiums based on health status, exclude coverage for pre-existing conditions, or emergency room care, impose lifetime or annual caps, opt not to cover certain conditions and benefits, rescind coverage, and require higher out-of-pocket costs,” says Feigin Harris.

With the expansion of short-term, limited duration coverage, Feigin Harris predicts a higher incidence of consumer confusion over what type of coverage they are purchasing and a fear by industry providers that patients who think they have coverage may not be aware of growing limitations in coverage and payment obligations. “There will likely be a higher incidence of uninsured and underinsured individuals, as well as bad debt in obtaining and paying for healthcare coverage, especially emergency coverage,” she says.

In HHS’ and Department of Labor and Department of Treasury’s comments on the ruling, the agencies note that the rule could lead to further worsening of the marketplace risk pool by keeping healthy individuals out of the individual market for longer time periods, increasing premiums for individual market plans, and possibly causing an increase in uninsured individuals.

Feigin Harris expects these plans will indeed make it more expensive to provide health insurance on the market if young, healthy individuals abandon the market in favor of short-term limited duration plans due solely to cost. “With sicker patients who need access to the full protections afforded by insurance sold on the exchange, costs will rise, leading to what some economists have termed the ‘death spiral’ in insurance rates,” she says.

: CMS issued an annual proposed Physician Fee Schedule on July 12 that included expanding telehealth options using communication technology.

Specifically, CMS recommended new billing codes to permit physicians to conduct virtual check-ins (i.e., brief phone or video calls) to assess whether an in-person visit is required and use asynchronous “store and forward” communications-in which patients upload basic medical history and clinical information via pictures or videos on a web-based platform, says Joyce Cowan, JD, a partner at Morgan Lewis.

The proposal is CMS’s first major foray into expanding telehealth services since the 2008 Medicare Improvements for Patients and Providers Act. “In the past decade, both providers and consumers have clamored for greater access to telehealth services,” Jacob Harper, JD, an associate at Morgan Lewis, adds. “States and insurers have recognized the value of expanding telehealth access and coverage, however, CMS has been limited by its existing statutory structure that covers (and pays for) telehealth services only when a patient is in an originating site that is located in a county outside a metropolitan statistical area or in a rural health professional shortage area.” Because of the existing statute that CMS must follow, it cannot alter the current telehealth requirements. Instead, it is creating a new category of telehealth-like services that it posits don’t fall under that statutory restriction.

Furthermore, the existing statute effectively permits only live audio-visual interactions, so CMS can’t alter that requirement for existing services either. This has largely limited Medicare coverage of telehealth services to inpatient specialist consults (i.e., a patient with heart disease in a rural Wyoming hospital might receive a cardiac consult from a specialist in New York). While commercial insurers have covered ailments that providers treated via telehealth, Medicare has not. The proposed rule establishes a separate category of services that skirt around this existing requirement.

“Now, perhaps taking a signal from Congress’s passage of the Bipartisan Budget Act of 2018 (which gives great flexibility to Medicare Advantage plans to provide telehealth services starting in 2020), CMS has acted,” Cowan says. “If finalized, the rule could give Medicare Advantage plans new tools to control unnecessary costs and promote increasing care coordination through more frequent patient communication.”



: The Final Rule will likely come out in late October or early November, Cowan says.

: “If adopted, CMS anticipates that these new services will incentivize physicians, particularly those monitoring established patients with chronic conditions, to treat patients without having an office visit,” Cowan says. “Many managed care organizations have recognized that telehealth helps avoid unnecessary in-person services.”

If a doctor thinks a complaint during a virtual check-in is serious enough to warrant an in-person visit, the patient is scheduled for an appointment and the virtual encounter is bundled into the in-person emergency and management code. However, if the physician can address the patient’s needs virtually, the provider would receive separate, albeit much lower, payment.

“Although all states don’t permit this technology, CMS’s blessing will likely compel universal adoption of this technology everywhere,” says Jacob Harper, JD, an associate at Morgan Lewis. “These technologies enable doctors to provide primary care services in a highly cost-effective manner.”

: In May, CMS announced that it would no longer report 18 key quality and patient-safety indicators, such as hospital-acquired infections, to the Hospital Inpatient Quality Reporting Program (IQRP). “This was concerning to payers and consumer groups, because it would limit transparency in hospital operations and make it more difficult for them to make informed judgments about the quality of services offered at hospitals,” says Robert H. Iseman, Esq, partner at the law firm Rivkin Radler LLP. The reports had been made to IQRP since the George W. Bush administration.

But those concerns were dissipated when CMS announced on August 2 that the same information will be made available through Hospital Compare, a website developed by the Medicare program in conjunction with consumer advocates, Iseman says.

: CMS delayed implementing the rule until August 2019 in order to put the new public reporting procedures in place. “CMS attempted to save hospitals the cost of duplicate reporting by no longer requiring the subject metrics and reports to be made as part of IQRP, while ensuring transparency by making the information publicly available elsewhere,” Iseman says.

Potential implications: Leah Binder, MA, MGA, president and CEO, The Leapfrog Group, which promotes transparency of patient safety and healthcare quality data for consumers, payers, and purchasers, says CMS will also include these patient safety and infection measures in its Value-Based Purchasing (VBP) Program as well as the Hospital-Acquired Condition (HAC) Reduction Program. “This means hospitals will continue to receive payment incentives for these measures in both programs established under the ACA,” Binder says.

The new regulations preserve complete information to consider when entering into contracts with health systems. Risk-adjusted infection rates and patient safety indicators are not replicable by individual payouts, so CMS’ requirement to report them is a critical tool for payers, Binder says.

According to a CMS spokesperson, “It is important for all Hospital Compare users, including payers, to know that they will see no difference in the publicly reported data for these measures when they are removed from the Hospital IQR program and remain solely in the HAC Reduction Program and VBP.”

Karen Appold is a medical writer in Lehigh Valley, Pennsylvania.

Articles

Healthcare experts detail three policies that MCOs should keep a close eye on.

Three Pieces of Healthcare Legislation to Watch 

Over the next five years, industry experts predict big changes that will significantly impact managed care. These range from state governments getting more involved in healthcare to more online retailers throwing their hat in the healthcare ring.

“As industries continue to blur, traditional healthcare companies will need to break down silos to drive value across the industry ecosystem,” says David Friend, MD, MBA, chief transformation officer and managing director, The BDO Center for Healthcare Excellence & Innovation, a healthcare accounting and consulting firm. “To compete with disruptors, healthcare companies will need to capitalize on data, maximize profitability, and innovate patient care all while managing growing risk in the areas of patient privacy and data security.”

It's a daunting challenge, but preparation can help ensure success. Here are some of the biggest areas of disruption that could impact your organization. 

This year a flurry of discussions and deal-making occurred between retailers and healthcare organizations, Friend says. This includes:
	- Walmart’s reported early-stage talks to acquire Humana;
	- The Amazon, JPMorgan, and Berkshire Hathaway venture that aims to transform its employees’ healthcare; and most recently,
	- Amazon’s billion-dollar acquisition of online pharmacy PillPack.

Other companies disrupting healthcare include big retail pharmacy chains such as Walgreens and CVS Caremark Corp., which are combining their thousands of stores and walk-in clinics with their e-commerce systems to create new digital healthcare delivery platforms, says Kim A. Buckey, vice president, Client Services, DirectPath, LLC, which helps employees become better healthcare consumers. For example, Walgreens partnered with MDLive in 2015 to facilitate telemedicine offerings to consumers.

Health-specific retailers that have entered the space, such as FSAStore.com and healthwarehouse.com, offer price transparency and product delivery to consumers who are price-sensitive, Buckey says.

Another notable entrant is large employers that are working alongside or acquiring emerging health and wellness companies, Buckey says. UnderArmour, for instance, has invested heavily in wearable devices and, with the acquisition of companies such as MapMyFitness and MyFitnessPal, has become the major player in digital fitness. Under the umbrella of its Connected Fitness segment, UnderArmour has access to tremendous amounts of health data.

Traditional technology entities are building healthcare apps, wearables, and other connected devices, and consumers are using them to track their health progress and feed data back to their provider, payer, or both, says Friend. “Technology has brought healthcare to consumers’ fingertips, putting them at the nucleus of care and blurring the definition of a healthcare organization.”

Retailers are partnering with pharmacies, to share data and reach more consumers, he adds.  Insurers are partnering with pharmaceutical manufacturers to leverage patient data to improve outcomes and lower health costs. “Everyone is getting into everyone’s business and will continue to do so to provide improved patient outcomes and ensure survival in a consumer-centric industry.”

The most valuable resource in healthcare is data, which online retailers-with their growing consumer health and wellness products-have in spades, says Friend. “Access to data and the ability to capitalize on that data is key to developing consumer-centric models of care, improving patient outcomes, and lowering costs.”

Online retailers like Amazon are entering the healthcare industry on other fronts, Buckey says. For example, they are selling personal health equipment such as walkers and canes directly to consumers and medical supplies such as gloves and syringes to providers. “Because of their experience negotiating low prices, ability to deliver products directly to consumers on a timely basis, and its built-in price transparency, they are well-positioned to disrupt the healthcare delivery landscape in particular,” Buckey says. For example, online retailers give consumers the opportunity to order medications or supplies online and have them delivered to their home or arrange for pickup at a local store.

“We’ve already seen a shift away from brick-and-mortar stores in other sectors; it was only a matter of time before we saw something similar with healthcare,” Buckey says. “Healthcare services and supplies are just as much a commodity as electronics, clothing, or even cars. With more purchasing power leaning toward consumers, it’s no surprise to see them opting for more convenient options when shopping for the healthcare treatments, services, and products they need.”

A new treatment, called immune effector cell therapy, allows physicians to harvest a patient’s T cells (a type of white blood cell), re-engineer them to target cancer cells by equipping them with receptors-proteins placed on the surface of T cells that allow them to bind more effectively to cancer cells-and then reintroduce them into that patient’s immune system, says Richard R. Barakat, MD, MBA, physician-in-chief and director of cancer, Northwell Cancer Institute. The institute is part of Northwell Health in Lake Success, New York, which is the state’s largest healthcare provider and private employer and treats 2 million patients annually. The engineered cells multiply in the patient’s body and recognize and kill cancer cells that harbor the receptor.

The most advanced therapy in clinical development in this space is chimeric antigen receptor T-cell (CAR T-cell) therapy.

The FDA has approved two CAR T-cell therapies:

Yescarta (axicabtagene ciloleucel), manufactured by Kite Pharma (which was recently acquired by Gilead), is approved for patients with refractory diffuse large B-cell lymphoma.

Kymriah (tisagenlecleucel), from Novartis, is approved to treat acute lymphoblastic leukemia in patients under age 25 years.

“These two treatments target small populations who have limited to no further treatment options, but [the treatments] pose challenges to the U.S. healthcare system due to their high upfront costs, uncertainty of effectiveness, and potential adverse events,” says Brian Duffant, vice president, BluePath Solutions, a market access and health outcomes consulting firm.

CAR T-cell therapy is intended to be delivered as a one-time treatment. The cost of therapy for Yescarta (with a wholesale acquisition cost of $373,000-the list price set by the manufacturer) and Kymriah ($475,000) is front-loaded. “This may result in short-term budget impact challenges, which are particularly acute for smaller payers and employers,” Duffant says. “The current U.S. healthcare system doesn’t have existing infrastructure for this type of cost dynamic, and will require innovative solutions such as payment over time, risk-share agreements, and indication-specific pricing.”

Although expensive, Amit Kumar, PhD, CEO and president, ITUS Corp., a cancer diagnostics and therapy company and board member of the American Cancer Society, says the overall impact of CAR T-cell therapies to the healthcare system is modest right now due to the small number of conditions it can treat. “Payers, including Medicare, are already working with providers and therapy developers to evaluate and institute new models for reimbursement,” he says. For example, CAR T-cell therapies may not be reimbursed unless there is an objective measure of efficacy.

Barakat says some payers already have policies for these two treatments. “Inpatient costs will likely be bundled into the total cost of the hospital stay,” he says. “While many institutions will likely launch their CAR T therapies in an inpatient setting due to the potential of significant toxicities … these therapies could possibly be performed in an outpatient setting as a pretreatment with an interleukin-6 (IL-6) receptor blockade-which could potentially result in less toxicity.”

Social determinants of health include economic stability, education, health and healthcare, neighborhood and built environment, and social and community context, according to Healthy People 2020, which provides 10-year national objectives for improving Americans’ health. “These are the conditions in which people are born, grow, live, work, and age, as well as the circumstances that impact their health,” says Lori Tremmel Freeman, MBA, CEO, National Association of County and City Health Officials, which advocates for local health departments. “Social determinants of health undergird many current healthcare challenges, including obesity, heart disease, diabetes, and depression.” 

While genetics plays a role in an individual’s overall health, most health outcomes are the result of circumstances outside the healthcare system. “The conditions in which someone lives, whether they have transportation to a clinic when needed, their support network, and other factors beyond the doctor’s office are as important to an individual’s overall health and well-being as being treated for an illness,” says Joseph Valenti, MD, board member, The Physicians Foundation, an organization that seeks to help physicians deliver high-quality care. “As the healthcare system effectively addresses these issues, the overall price of healthcare in the United States will decrease and people will generally be healthier.”

Some states, insurers, and hospitals are already factoring social determinants into healthcare by doing things like ensuring patients have adequate housing and access to needed resources and programs.

Freeman says more attention to social determinants would provide a more balanced approach to health.

From a public health perspective, she says healthcare can be categorized at three levels:

Secondary, treating disease in the early stages; or

Tertiary, treating the effects of a disease or illness.

Considering diabetes as an example, primary care would include a focus on healthy lifestyle, secondary care would involve monitoring of blood levels and medication, and tertiary care could include amputation.

Primary, secondary, and tertiary care can be targeted at the individual, interpersonal, organizational, community, or public policy level, Freeman says. Naloxone, a medication designed to rapidly reverse opioid overdose, for example, is tertiary care at an individual level. On the other hand, given that unemployment is thought to contribute to patterns of opioid use, a strategy of increasing job opportunities becomes primary care at a community level. By focusing on the social determinants, organizations can better address population health problems.

Social determinants of health could impact how the healthcare industry conducts business. Instead of concentrating on tertiary care for patient populations only, healthcare could participate more in community health, Freeman says. Eventually, as social determinants of health become a greater part of the healthcare portfolio, tertiary care spending would decrease while quality of life would increase for affected communities.

In many places, this has already begun, as hospitals and health insurers work with local health departments around community health concerns, she says. By law, providing community benefit has been central to the tax-exempt status of nonprofit hospitals. The ACA’s explicit requirement for nonprofit hospitals to consider input from those with public health expertise in the development of hospital community health needs assessment and implementation strategies has increased local collaborations around social determinants of health.

As more electronic health data becomes available, artificial intelligence (AI) can unlock the potential for that information to be used to improve healthcare. “No more will ‘doctor knows best’ be sufficient,” says Jodi Daniel, a partner in Crowell & Moring’s Healthcare Group and a member of the firm’s Digital Transformation Practice. “Clinicians will need to apply their training and experience along with data and sophisticated systems that can identify new information that may not have been available or transparent before. This could lead to significant improvements in diagnosis and treatment and create efficiencies for provider and patient interactions and administrative functions.”

- Population health management, in which AI software can help clinicians and insurers better identify and prioritize patients to provide the right level of resources to minimize costs and improve patient outcomes, Daniel says.
	- Diagnostics, in which AI is assisting with diagnoses. For example, this year, the FDA approved AI-based tools for detecting wrist fractures and diabetic retinopathy in patients, decreasing time from onset to treatment.
	- Patient care, in which it can help providers determine the treatment approach. In February, for example, the FDA approved clinical decision support software that uses AI algorithms to analyze images for indicators associated with a stroke, Daniel says.

Growth in the AI health market is expected to reach $6.6 billion by 2021-a compound annual growth rate of 40%, according to Accenture. Several trends are driving that growth:

The continued, unmanageable increase in healthcare costs. “Value-based payment requires that clinicians have actionable data to manage patients and that health plans have data and tools to evaluate performance and health outcomes,” says Daniel.

Concerns continue to grow regarding physician burnout and medical labor shortages. “AI software can reduce the burden of providers when doing documentation and data management, and AI tools can help triage patients so that physician time is available to patients with the greatest need,” Daniel says.

Technology advancements across all industries have resulted in patients changing their expectations of their healthcare interactions. “Individuals are used to quick responses, electronic access to information, and the ability to be more engaged in decision making,” Daniel says. “There will be a growing need for the healthcare sector to adopt AI technology to streamline services and to improve quality of those services.”

A thirst for improving the understanding of complex diseases and treatments and conducting research. “AI will be an important tool for analyzing vast amounts of data to develop future treatments,” she says.

Ultimately, Daniel says the single-most significant potential for AI is its power to change the standards of practice. “Better analytical tools for improved diagnosis and treatment and more data from outside the clinical care setting such as patient-generated health data and social determinants data can provide a more accurate picture of the patient and improve care decisions and outcomes,” she says.

State governments have been operating the Medicaid program, which has become a fundamental driver of U.S. healthcare policy and service delivery, since 1965. Medicaid now covers 74 million people, including paying for more than half of the country’s births and more than 65% of nursing home residents.
	
	Thirty three states and the District of Columbia have expanded Medicaid to cover childless adults under the ACA. Legislation introduced by U.S. Sen. Brian Schatz (D-Hawaii)  and U.S. Rep. Ben Ray LujÃ¡n (D-New Mexico 3rd District)  in October 2017 titled the State Public Option Act, would create a Medicaid-based public healthcare option on the insurance marketplace. Since then several states, including Nevada, Iowa, Massachusetts, Minnesota, Missouri, New Jersey, and Washington, have introduced Medicaid buy-in proposals to cover more uninsured or underinsured individuals, says Pamela Coleman, senior consultant, Sellers Dorsey, a national healthcare consultancy.

Having worked with the Medicaid program since the mid-1980s, Coleman has seen it evolve from one where states passively paid claims to one where the emphasis is on paying for positive healthcare outcomes. “The majority of states have implemented managed care models where health plans are put at risk for poor patient outcomes,” she says. “Performance measurement and continuous quality improvement are central to these models. Many healthcare delivery innovations have come from state Medicaid programs.”

Because states must balance their budgets, unlike the federal government, they must innovate to ensure their programs are sustainable and produce results for their Medicaid population, Coleman says. “In order to innovate, state policymakers must disrupt the status quo and develop and implement new ways to finance their Medicaid programs, reimburse providers by paying for value, not volume, and work with health plans to ensure providers are available to deliver healthcare services throughout a state.”

Given the current political climate, Coleman views Medicaid for All as more attainable than the Medicare for All proposal. Medicaid for All proposes the option for individuals to buy into Medicaid coverage and be eligible for premium subsidies and reduced cost sharing. In contrast, Medicare for All, as proposed by U.S. Sen. Bernie Sanders (D-Vermont), would create a national insurance system for single-payer coverage for all U.S. citizens.

A recent analysis by The Mercatus Center estimated that this proposal would lead to a $32.6 trillion increase in federal spending over a 10-year period. A Medicaid for All buy-in program would likely cost the federal government much less, says Coleman. 

Also, unlike Medicare, states administer Medicaid, which covers populations from newborns to frail seniors and includes many individuals with mental health conditions and substance abuse disorders.

“Medicaid is leading the fight on the opioid epidemic by requiring health plans to develop innovative interventions to address problems at the community level,” Coleman says. “Medicaid initiatives that focus on social determinants of health such as housing, nutrition, obesity, and education are also expanding.”

As the ultimate safety net provider, Medicaid faces continuous challenges to provide quality services to beneficiaries while keeping costs down. New flexibilities offered through managed care models and waivers allow for payment of such things as minor home modifications for persons with disabilities, air conditioners for persons with asthma, and supportive employment for persons with intellectual disabilities. “These interventions are far more cost effective than traditional healthcare services and promote personal independence,” Coleman says.

In order to receive federal funding, states must provide a core set of services and beneficiary coverage. To manage these expenditures, states have developed creative solutions to reform healthcare service delivery, such as accountable care systems and value-based payment models. “These transformations can be truly disruptive as Medicaid will no longer pay providers on the basis of volume, but rather on the basis of value,” Coleman says

Whether states adopt Medicaid for All strategies, they will continue to reform Medicaid practices to promote quality and cost-effective delivery, she says. “Large national Medicaid managed care organizations are agreeing to enhanced performance requirements and states are enacting more sophisticated and comprehensive oversight of managed care contracts.”

What these healthcare industry disruptors are, and how they could impact cost and quality of care.

Top 5 Disruptive Trends to Watch in Healthcare 

The success of performance-based, retail pharmacy networks for Medicare Part D is prompting some PBMs to create similar ones for their commercial and Medicaid populations. Incentives for pharmacies that demonstrate improvement in medication adherence for certain chronic conditions and increased engagement are at the core of these networks.

“These networks need to strike the right balance between cost and safety and can run the gamut of pay-for-performance to shared savings to risk-bearing models based on patient outcomes,” says Crystal Lennartz, vice president, pharmacy performance for Health Mart Atlas, a pharmacy services administrative organization (PSAO) under the McKesson umbrella.

Lennartz attributes these networks to the advent of preferred benefit structures, with performance and more dollars tied to contracts to improve the health of plan beneficiaries and ultimately, reduce overall healthcare costs. 

She says the trend began in 2016, when PBMs introduced variable direct and indirect remuneration (DIR) fee rates (e.g., based on a percentage instead of a flat dollar fee), in which pharmacies and PSAOs could achieve a lowered DIR amount if they met performance metrics.

Lennartz indicates that DIR makes performance-based networks in Medicare more punitive than in other populations. “A pharmacy could lose money when processing a claim through Part D, which is often correlated with arbitrary performance measures,” she says.

In 2018, all of Health Mart Atlas’ more than 6,800 pharmacies are in some type of performance-based network, including DIR designs. Lennartz says 2,000 of its pharmacies are eligible to participate in the true incremental, pay-for-performance programs across 47 states-nearly doubling over 2017. Total dollars committed to the program also have nearly doubled since last year.

Express Scripts to launch commercial, Medicaid networks

Jennifer Awsumb, senior director, network products, Express Scripts, agrees with Lennartz that the concept of performance-based networks isn’t new. The PBM is using its experience with value-based contracting in Medicare in 2017, and extending it to Medicaid and commercial populations. “We focused on Medicare initially because of Star Ratings and because our clients wanted solutions with pharmacy at the center,” she says.

Express Scripts is launching a 12-month pilot this fall, addressing pharmacy performance in its commercial and Medicaid populations. It is designed to optimize medication therapy management, improve adherence, and promote better outcomes. As many as 35,000 pharmacies, including national chains, grocery store pharmacies, and community pharmacies, will participate in the pilot.

These pharmacies will be able to track their own performance and identify gaps in care via a web portal, while participating plan sponsors select four therapy classes they feel need improvement in medication adherence, such as diabetes, high cholesterol, hypertension, and asthma, and use results to measure each pharmacy's performance.

Pilot metrics are recognized by the Pharmacy Quality Alliance, some of which are similar to CMS Star Ratings measures, but are not identical. These measures are adherence to diabetes medications and to renin angiotensin system antagonists for hypertension and use of statins for diabetes patients.

Express Scripts chose proportion of drugs covered, or what percentage of days a patient has a medication, for diabetes, high cholesterol, and hypertension; use of a controller vs. a short-acting rescue inhaler; and opioid overlap with benzodiazepine for the commercial and Medicaid performance network that officially starts January 1, 2019. Like the pilot, it will include 35,000 pharmacies.

Awsumb says that the PBM deliberately chose only three metrics for the pilot and five for the 2019 network because pharmacies indicated that too many measures could become overwhelming.

Retailers in the network pilot and in the 2019 network will compete against each other, incentivizing them to continuously improve their performance through relative assessment, rather than predefined benchmarks. The lowest performers will be penalized, but not based on a benchmark.

Prime Therapeutics highlights quality improvement in networks

Prime Therapeutics is seeing growth in adoption of performance-based networks by health plan clients and pharmacies who are looking to differentiate their plans, says Bretta Grinsteinner, assistant vice president, network management for the PBM.

Prime has 11 health plans using performance-based networks for Medicare related to disease-specific conditions and specialty drugs. Like Express Scripts, the PBM also is expanding its system infrastructure to support commercial and Medicaid plans.

Prime’s quality program in Medicare uses metrics appropriate for the line of business and/or goals of each health plan, including measures such as adherence to oral diabetes, hypertension, autoimmune, and cholesterol medications; statin use in individuals with diabetes; high-risk medication dispensing; generic dispensing; and comprehensive medication review completion rates, says Grinsteinner.

The PBM plans to add adherence to anti-retroviral medications and statin use in individuals with cardiovascular disease, along with building quality programs around HIV, specialty multiple sclerosis, and autoimmune diseases including rheumatoid arthritis.

Pharmacies are measured at the individual pharmacy location on a year-to-date score with three measurement periods and receive a performance rating on a scale of one to five for each measurement period. Performance in the higher two tiers earns incentives.

Pharmacies that receive a rating in the middle tier can earn incentives if there has been improvement over the course of the year. Prime meets monthly with pharmacies and clients to review performance ratings and identify pharmacies/measures that need attention.

Grinsteinner anticipates that performance networks that enable health plans and pharmacies to improve outcomes and increase adherence will reduce hospitalizations and emergency visits, thus saving money. In Prime’s Medicare book of business from 2015 to 2017, adherence for performance-based network pharmacies improved by 3.7%, nearly twice as much as the non-performance-based network pharmacies, whose improvement increased by 1.9%, she says.

In fall 2017, CVS Health initiated a new 30,000 store, performance-based, pharmacy network anchored by CVS Pharmacy and Walgreens, along with up to 10,000 community-based, independently owned pharmacies across the country. The network is designed to improve clinical outcomes and help lower costs for CVS Caremark PBM clients and their plan members, according to CVS spokesperson Christina Beckerman.

The performance network uses a value-based management approach to achieve improved outcomes through medication adherence for diabetes, hypertension, respiratory conditions, depression, and behavioral health. It also helps to provide cost savings through formulary compliance.

Savings will vary, but clients moving from a national network can expect to save up to 4% in gross pharmacy spending, Beckerman says. Pharmacies are encouraged to implement their own proprietary programs and work flow processes to achieve results, such as encouraging members to take their medications as instructed, improving overall health, and lowering costs for patients and payers, not just dispensing medication.

“Across healthcare, we are seeing a shift away from fee-for-service to more value-based reimbursement and payment models,” Beckerman says. “In pharmacy care, we expect network design options that align incentives and outcomes to also grow as payers look for new ways to help contain costs and drive better health outcomes for their member populations.”

Innovative PBM performance-based pharmacy networks focus on reducing costs and Improving clinical outcomes

PBM Performance-Based Pharmacy Networks Aim to Cut Costs 

Up to 30% of patients prescribed opioids for pain misuse them, according to the National Institute on Drug Abuse, a division of the National Institutes of Health. Between 8% and 12% of patients who are prescribed opioids develop an addiction. In total, the institute states that 115 people in the United States die every day due to opioid overdoses.

“Given the nationwide emphasis on the opioid crisis, those living with chronic pain feel there is a stigma that comes with seeking out strong pain prescriptions,” says Shai Gozani, MD, PhD, president, CEO, and director of NeuroMetrix, Inc., the company that created Quell, a wearable neurostimulation device. “It's important to provide individuals with long-term pain conditions with enough options to be able to find an effective relief system that works for them.”

Below are some technology solutions on the market that can treat chronic pain, allowing patients to eliminate or decrease their dependence on opioid drugs.

By using neurostimulation technology to tap into the body’s natural pain response and block pain signals, Quell helps patients with chronic back, arthritic, nerve, leg, and foot pain. The wearable device is FDA-cleared for daytime and overnight use. It is inserted in a cuff that can be positioned on the body and has an accompanying app that helps people track pain management and sleep patterns affected by chronic pain.

 in April 2018 found that 80% reported improvement in their chronic pain and about 66% reported reduction in their pain medication use due to using Quell. On average, study participants used Quell for 35 hours per week.

“Because pain is extremely personal and is experienced differently by all people, those living with chronic pain often need a variety of treatments to find relief-what we call a ‘toolbox approach’ to chronic pain,” Gozani says.

The SPRINT PNS system by SPR Therapeutics

The SPRINT PNS system is designed to treat pain through peripheral nerve stimulation. The single thin, thread-like wire, or lead, is implanted through a needle introducer under ultrasound guidance and is placed approximately 1 centimeter from nerves for stimulation therapy delivery up to 60 days. The system is used to treat post-amputation, lower back, shoulder, and knee replacement pain.

“As a device there are no withdrawal symptoms, and consequently, no drug-related side effects,” says Mark Stultz, senior vice president of market development for SPR Therapeutics. “SPRINT is intended to provide pain relief directly to the nerve where it is needed, whereas opioids are systematic, have significant side effects, and are susceptible to addiction and diversion.”

The system is currently on the market, and the company recently launched its next generation, dual lead system (which allows for more thorough coverage of the pain area), SPRINT extensa PNS system, following FDA approval on July 31.

Virtual reality (VR) provides a unique approach to pain management, as studies show that immersive distraction can de-escalate some chronic pain.

BreatheVR is an application available through Samsung Gear VR and Oculus Go headsets that helps patients with deep breathing and meditation exercises to alleviate pain.

Deepa Mann-Kler, founder and CEO of Neon, says a November 2017 pilot study of BreatheVR found that in less than three minutes, 80% of participants reported a de-escalation of pain.

“The biggest drop in pain was 50%, from 7 to 3.5 on the visual analog scale psychometric response pain scale,” Mann-Kler says. “The benefits of deep breathing and meditation have long been recognized as aiding relaxation. Recent studies using virtual reality also evidence further benefits. BreatheVR combines the power of virtual reality and deep breathing to create a uniquely immersive user experience.”

The BreatheVR application engages users in an animated meadow, by having them listen to music and birds. The user is asked to inhale and exhale, and as their breath is detected by the headset’s microphone, leaves in the virtual reality environment move. This sequence is then repeated, encouraging the user to get into a pattern of diaphragmatic breathing.

Mann-Kler says there are more than 100 active users of the application and the company is  compiling use cases from fibromyalgia patients who are using BreatheVR at home.

“We have not fully explored VR’s capabilities yet,” Mann-Kler says. “When we can truly personalize the experience for each person through the use of full sensory and biodata feedback loops, we will actually be meeting each person’s needs on an individual basis.”

This long-term pain solution treats chronic nerve pain through peripheral nerve stimulation. It has been used on 24 different peripheral nerves since launching in 2016. The device is 15 centimeters and “feels like a limp piece of spaghetti,” says Mark Geiger, global director of marketing implantables at Bioness, the company that produces StimRouter.

“By stimulating the target peripheral nerve with a small amount of energy that feels like a gentle tingling sensation, the nerve cannot communicate a pain signal. Over time, this stimulation may cause the nerve to perform more normally,” Geiger says. “So, the difference is targeted pain management at the source of the pain compared to global pain reduction with an oral or IV pain medication with all the typical, sometimes deleterious side effects.”

The StimRouter is implanted through the skin, while the patient is under local anesthesia. According to Geiger, patients can provide feedback to the physician implanting the device immediately.

“The StimRouter is a permanent solution meant to last a lifetime. In many cases, based on many hundreds of implants, patients use the StimRouter for shorter durations over time with increasing carry-over pain relief, meaning the pain relief lasts for hours/days after the StimRouter is shut off by the patient,” Geiger says.

Donna Marbury is a writer in Columbus, Ohio.

These technology solutions on the market can treat chronic pain, allowing patients to eliminate or decrease their dependence on opioid drugs.

Technologies Seek to Ease Chronic Pain: 4 Devices to Watch 

A change is occurring, and it’s not the type of change we typically talk about in the shifting healthcare landscape. It is a change requiring us, as healthcare leaders, to acquire new skills, talents, and capabilities as we lead new and expanded teams of people in the treatment of patients.

Physician leaders, in particular, are trained well to do many things. We perform highly technical skills and complicated procedures. We manage multiple needs at the same time. We take an unstructured human narrative, break it down into individual components, and develop an entire care plan-determining if and when others are needed. We are trained well for one-to-one interactions with our patients. This training has made us very good at a certain type of leadership-one that is based on hierarchy and a top-down approach.

Unfortunately, this team dynamic and leadership style is not effective in a value-based reimbursement model, where better health outcomes for chronically-ill patients is the measure of success.

In the managed healthcare market, words like logical, predictable, or stable are seldom used anymore. Instead, for healthcare executives, disruption is the norm. The usual change drivers-an aging population dealing with more chronic illness and the increasing problems of affordability and government regulation-are coupled with other disrupters that make it even more difficult for healthcare executives to find the right course. These include:

While the federal government has long been a disruptive force in healthcare, this has generally been related to new policies, programs, or approaches. We’ve entered an era with no clear federal policy except eliminating and destabilizing previous approaches such as the ACA.

Due to the lack federal direction on healthcare, some states are considering new approaches to cover their residents, including Medicaid buy-in programs and even Medicaid for all. Others are evaluating moving from Medicaid capitation to fee-for-service, increasing emphasis on value-based contracts, and expanding their focus on quality and outcomes.

Many new states are pursuing Medicaid expansion. This includes work and other requirements that force health plans into roles beyond their expertise. These new requirements are sometimes not included in rate calculations, thus resulting in rates that are not actuarially sound.

The awareness that a person’s social conditions has a greater impact on their health than their genetics has emerged as a significant driver for how health plans approach member services. Lack of food security, housing, transportation, or a safe environment are enormous contributors to preventable morbidity and mortality and are beginning to be incorporated into care plans and health plans’ outreach efforts and community initiatives. In addition, insurers are forging new partnerships with community partners to ensure access to these services.

This rapidly emerging approach to treating disease considers individual genetic, environmental, and lifestyle variability and is reshaping how many medical conditions are treated. While usually more effective than previous approaches, precision medicine is often more expensive and has fewer provider network options. While many health plans aren’t covering precision medicine, clinical studies demonstrating effectiveness will push consumer demand for its coverage.



With Amazon’s announcement of its intent to purchase PillPack and its partnership with JP Morgan Chase and Berkshire Hathaway to establish a disruptive new healthcare enterprise, Jeff Bezos is clearly eyeing healthcare as a market open to business opportunities. Apple and Google also have investments in healthcare initiatives. Even unintentionally, ebusiness is disrupting healthcare as demonstrated by Uber’s impact on reducing traditional ambulance services.

At $3.5 trillion, the healthcare industry comprises 21% of the U.S. economy. Despite investing far more in Americans’ healthcare than any other country does, the United States delivers poor results in terms of affordability, quality, access, and outcomes. Until there’s a balance between the dollars invested in healthcare and the results obtained, significant changes in products, strategies, competitors, and federal and state regulation will continue. For healthcare executives, trying to achieve this balance should be their consuming focus. Disruption is not going away, it will only become even more frequent and rapid.

Don Hall, MPH, is principal of DeltaSigma LLC, a consulting practice specializing in strategic problem solving for managed care organizations. He most recently served as president and chief executive officer of a nonprofit, provider-sponsored health plan.

In the managed healthcare market, words like logical, predictable, or stable are seldom used anymore. Instead, for healthcare executives, disruption is the norm.

Five Disruptors Healthcare Executives Must Watch 

Progress seldom comes without cost, and that's certainly the case for treatment of lymphoma and other cancers. While promising new options keep entering the scene, high costs can be problematic to patients and their families.

Lack of upfront information is part of the challenge, according to Alan Tan, MD, clinical research medical director, medical oncologist and hematologist for Cancer Treatment Centers of America in Phoenix.  In general, oncologists often discuss with patients any potential toxicity of their cancer treatment, he says, but only 

 report having had discussions with their oncologist about financial realities, according to the National Cancer Institute. 

"Financial toxicity can lead patients not only into debt, depleted savings, and even bankruptcy, but also skipped medication doses and consequently shortened survival," he says. Tan notes that in hematologic malignancies, many of the standard treatment regimens can run well over $100,000 per year with a single once-a-day pill that continues indefinitely. Many trials show incremental benefit with combination therapies as well, which tend to be very expensive.

He adds that with developments such as CAR T-cell therapy, which has gained attention for unprecedented response rates, costs for treatment are even greater, with price tags such as $373,000 and $475,000.

"These prices are only for the cost of extracting the patient’s T cells and engineering them to produce the CARs on the surface of the cells, and infusing them back into the patient," he says.  “When one includes hospital stays, supportive care for potential toxicity, and physician visits including consultants, the total cost can exceed more than a million dollars per patient.”

Tan says that oncology is a difficult topic with respect to cost because of the life-and-death implications and the cost of innovation. That noted, efforts to promote understanding and contain costs where possible are advisable. It’s important to have transparency around cost benefits of treatments, adherence to the best evidence, and a willingness to explore ways to link outcome and costs such as through the oncology medical home or value-based approaches to pharmacy," he says.

He also encourages careful consideration of treatment options.

"For very expensive treatments such as CAR T-cell therapy, we should only be offering this to the sickest patients with the fewest options," Tan says. "Patients with lymphoma overall do well with standard chemotherapy and may well be cured."

Manish J. Dave, MD, who specializes in hematology and oncology at CareMount Medical in Mount Kisco, New York, also notes that some treatments can be effective even though they are not at the high end of the cost scale.

“Rituximab is a commonly used treatment for many blood cancers," he says. "Recent studies have shown that the medication’s cost per quality-adjusted life year has been falling within standard thresholds for cost-effectiveness."

One way to manage appropriate treatment selection is the use of novel clinical endpoints and highly accurate, standardized diagnostic tests, according to Charles Sang, senior vice president at Adaptive Diagnostics in Seattle. He encourages healthcare executives to embrace standardized molecular diagnostic tests. 

“There are numerous barriers to coverage of advanced diagnostic technologies, which results in limited adoption in the practice of medicine in ways that can potentially improve care and provide mechanisms for cost containment,” he says. “Diagnostics can play a role in leading to the identification of more effective treatments, as well as more cost-effective use of those treatments.”

Tan points to the need to be able to identify high-risk groups of patients that biologically are sure to relapse and expose them to CAR T-cell therapy earlier.
     
“We need biomarkers that best select patients that have the highest likelihood of responding to CAR T-cell therapy,” he says. “It would be a shame to spend over a million dollars for a treatment that did not work at all.”
      
He also advocates a value-based pricing and use model.
     
“Perhaps a million dollars is not that steep of a price if you can cure a patient with a one-time treatment,” he says.

Greater levels of competition should provide some relief, he predicts.

“Encourage competition,” he says. “CAR T-cell pricing will surely go down as more competitors come to market. Stimulate generic and biosimilar market competition.”

The bottom line is that a patient's well-being comes first.

"A cancer patient’s financial constraints and/or socioeconomic status should not compromise their health, longevity, or quality of life due to symptoms from cancer," Dave says. “We recommend a multi-disciplinary team of medical oncologists, pathologists, radiologists, and other clinicians review complicated cases to provide the best care possible to patients. We encourage patients to participate in clinical trials, which offer new, often groundbreaking treatments."

While promising new options keep entering the scene, high costs can be problematic to patients and healthcare organizations. Here are some ways to cope.

What Health Orgs Should Do as Cancer Treatment Costs Increase

FDA’s approval of a new drug, Onpattro (patisiran) infusion, to treat peripheral nerve disease (polyneuropathy) on August 10 also marks FDA’s first approval of a new drug class called small interfering ribonucleic acid (siRNA) treatment.
 
The drug, manufactured by Alnylam Pharmaceuticals, Inc., was approved for adults with polyneuropathy caused by hereditary transthyretin-mediated amyloidosis (hATTR), a debilitating and often fatal genetic disease characterized by the buildup of abnormal amyloid protein in peripheral nerves, the heart, and other organs. Affecting about 50,000 people worldwide, hATTR is a rare condition.

“The disease results in patients developing numbness and weakness in their limbs, difficulty with gut movement and digestion, and heart failure,” says Michael J. Polydefkis, MD, professor of neurology at John Hopkins University in Baltimore and a lead investigator of the phase 3 APOLLO study for Onpattro. As an inherited disease, if someone has hATTR each of their children has a 50% chance of getting the disease-causing gene.

Here are four other things that MCOs should know about this new drug.

. The treatment alters the genetic drivers of disease. RNA inhibitors (RNAi) can essentially target any gene in the human genome and prevent it from turning on. “Targeting the disease’s source (the expressed gene) versus a surface membrane protein (which is how biologics work) provides an off switch for the disease,” says Kellie Rademacher, PharmD, vice president of Payer Access Solutions at Precision for Value, a healthcare company that supports commercial excellence for pharmaceutical clients.

“RNAi has the potential to be disease modifying not only for hATTR, but also for other diseases caused by gene expression, such as hemophilia, cancer, and age-related vision loss,” Rademacher says. “RNAi technology is precision medicine at its foundation.” 

. Currently, drugs to treat hATTR slow its progression, but don’t stop it. “The gold standard of treatment is liver transplant or multi-organ transplant (depending on the disease’s severity), because the TTR protein is primarily produced in the liver. Data released for Onpattro showed a reduction in the development and deposits of TTR amyloids, resulting in maintenance or improvement in ambulation, nutritional status, activities of daily living, and quality of life, Rademacher says. 

Polydefkis believes that patients who take Onpattro will experience less disability, be more productive, and ultimately live longer.

. The average annual list price for Onpattro before insurer discounts is estimated at $450,000. The effective net price is $345,000 annually, taking into account mandatory government discounts. According to a press release by the manufacturer, “As a therapy designed to treat less than 3,000 currently diagnosed patients in the United States, Onpattro is priced relative to the population it will treat.”

Rademacher says the pricing isn’t outside the realm of what she has seen with other rare disease agents, especially where technological scientific advancements have been made. “Even though only a small number of people have this disease, payers will likely want to manage Onpattro carefully because of its cost and specificity,” she says. “Onpattro is a lifelong therapy without any realized outcomes yet. Clinical trial data look promising, but whether or not real-world outcomes translate into savings for payers and patients remains to be seen.”

Methods to pay for pricy drugs are needed

. Rademacher says how the system reimburses for Onpattro and other new exciting gene-related technologies needs to be reassessed. “Perhaps costly drugs could be financed similar to how other large purchases are financed,” she says. “How the healthcare system provides access and reimburses for these advances will require all stakeholders to collaborate.”

Here are four other things that MCOs should know about a first-of-its kind targeted RNA-based therapy to treat a rare disease.