About health insurance/insurers
Per a report from Stat: Why Medicare hospital spending is down
”Health policy gurus have been scratching their heads a little bit lately, because the amount of money Medicare’s trust fund has spent on hospital care in the latter half of 2022 is still well below what they expected. Now, the government’s top health care actuary has some answers.
Paul Spitalnic, the chief actuary at CMS, spoke during a webinar hosted by the American Academy of Actuaries last week and detailed three reasons for the tempered hospital spending among beneficiaries in the traditional Medicare program:
The pandemic, of course. Adults who are 65 and older continue to be the most vulnerable to Covid (this demographic makes up only 13% of reported Covid cases, but 75% of Covid deaths). Medicare beneficiaries who survived Covid also are less costly.
People who are eligible for both Medicare and Medicaid — people who are poor, older, and often have severe disabilities or serious health conditions — increasingly are moving to Medicare Advantage.
Hip and knee replacements have moved to outpatient settings, which has taken pressure off Medicare’s Part A trust fund that pays for hospital care.”
An Update to the Budget Outlook: 2023 to 2033 From the CBO. Some Medicare/Medicaid highlights:
—In CBO’s current projections, federal outlays (adjusted to exclude the effects of timing shifts) rise from $6.3 trillion in 2023 to $9.8 trillion in 2033, an average annual ncrease of 4.5 percent. Outlays for Social Security
and Medicare account for over half of that $3.5 trillion increase. By 2033, outlays for Social Security, the major health care programs, and interest account for 65 percent of projected spending.
—…two underlying factors—the aging of the population and growth in federal health care costs—put upward pressure on mandatory spending. The increase in the average age of the population causes the number of beneficiaries of Social Security and Medicare to grow faster than the overall population, and federal health care costs per beneficiary continue to rise faster than GDP per person. As a result of those two trends, outlays for Social Security and Medicare will increase from 8.2 percent of GDP in 2023 to 10.1 percent in 2033, CBO projects. The effects of those trends on fed- eral spending will persist beyond the next decade.
—The announced policy changes affecting payments to MA plans caused CBO to decrease projected spending over the 2024–2033 period by $223 billion, compared with the February baseline.
What Could New Anti-Obesity Drugs Mean for Medicare? “Lifting the current law prohibition on coverage of weight-loss drugs would come at a cost to Medicare, given the high price and expected demand. Wegovy, for example, has an annual estimated net price of $13,600. According to a recent study, if 10% of Medicare beneficiaries with obesity use Wegovy, the annual cost to Medicare could be $13.6 billion (based on a 19% obesity rate from traditional Medicare diagnoses in 2021) to $26.8 billion (based on a 41.5% obesity rate from survey data for adults ages 60 and older). Higher take-up rates would mean higher Medicare spending. For context, total annual Part D spending in 2021 was $98 billion. Of note, these estimates do not account for potential reductions in Medicare spending that could occur if weight loss drugs reduce medical spending associated with other diseases, such as heart disease.”
Denials of health-insurance claims are rising — and getting weirder Great opinion piece in The Washington Post. Here is the strangest case (in my opinion):
”An insurer’s letter was sent directly to a newborn child denying coverage for his fourth day in a neonatal intensive-care unit. ‘You are drinking from a bottle,’ the denial notification said, and ‘you are breathing on your own.’”
Crowe RCA benchmarking analysis “Crowe RCA data shows that commercial payors reimburse providers at a higher amount on a per-case basis compared with Medicare:
$18,156.50 is paid by commercial payors compared with $14,887.10 paid by Medicare in average net revenue per inpatient case.
$1,606.86 is paid by commercial payors compared with $707.30 paid by Medicare in average net revenue per outpatient case.
It’s true that commercial payors might generate more net revenue than public payors on a per-case basis. But at what cost?
The comprehensive Crowe RCA database tracks all aspects of payor performance, and the performance across commercial and public payors varies widely. In fact, commercial payors take the longest to pay, require providers to jump through more administrative hoops to get paid, and delay payments to providers via claim denials at a higher frequency than government payors…
In 2022, the initial prior authorization/precertification denial rate for inpatient claims for commercial payors was 2.8%, up from 2.4% in 2021. We’re seeing more of the same again this year with the rate at more than 3% through the first three months of the year. By comparison, the denial rate for traditional Medicare was 0.2% through the first quarter of 2023.”
About pharma
Most expensive drugs in the US in 2023 FYI
Time to Confirmatory Study Initiation After Accelerated Approval of Cancer and Noncancer Drugs in the US “The Consolidated Appropriations Act of 2023 provided that the FDA “may require” confirmatory studies to be “underway prior to approval, or within a specified time period after” accelerated approval. Since the statute permits, but does not require, the FDA to use this authority, further information regarding the timing of confirmatory study initiation and completion for cancer and noncancer products may benefit both the FDA and policy makers as they implement this legislation and consider future reforms to the accelerated approval pathway…
[This study showed that] “For 103 cancer–indication pairs and noncancer products, 20.31% (26 of 128) of confirmatory studies were not underway at the time of accelerated approval, and the median (IQR) time from approval to study initiation was 1.41 (1.10-2.04) years.”
Comment: Pharma companies are getting accelerated approvals but, in a large portion of cases, confirmatory studies were not started on time and are much delayed when started. The FDA needs to assure these studies are in progress when it grants accelerated approvals.
About the public’s health
Global Burden, Risk Factors Analysis, and Prediction Study of Ischemic Stroke [IS], 1990–2030 “Between 1990 and 2019, the global number of IS deaths increased from 2.04 million to 3.29 million and is expected to increase further to 4.90 million by 2030. The downward trend was more pronounced in women, young people, and high social-demographic index (SDI) regions. At the same time, a study of attributable risk factors for IS found that two behavioral factors, smoking and diet in high sodium, and five metabolic factors, including high systolic blood pressure, high low-density lipoprotein cholesterol, kidney dysfunction, high fast plasma glucose, and high BMI, are major contributors to the increased disease burden of IS now and in the future.”
About health technology
FDA okays Krystal's Vyjuvek as first topical gene therapy for dystrophic epidermolysis bullosa You can read about the clinical indications but of significance is that this treatment is “the first redosable gene therapy…”
Thermo Fisher's test to detect pregnancy-related complication gets FDA nod “The U.S. Food and Drug Administration (FDA) has cleared Thermo Fisher Scientific Inc's test, the first of its kind in the country, to detect women with risk of severe preeclampsia…”
Comment: Could become a standard of care, which means tremendous sales for Thermo Fisher.