New Interactive Tool to Monitor U.S. Health Care Spending

By Claire Thayer, April 8, 2015

A week or so ago, The Peterson Center on Healthcare and the Kaiser Family Foundation unveiled a cool new interactive tool for public access to measure quality and cost components of the country's health care system on their new site, The Peterson-Kaiser Health System Tracker.  “This interactive tool provides up-to-date information on U.S. health spending by federal and local governments, private companies, and individuals. It was developed by analysts at the Kaiser Family Foundation using data from the National Health Expenditure Account and will be updated annually with each data release.”  Using the Health Spending Explorer interactive tool, data can be tracked as far back as 1960, with most recent data as of 2013 (which will be updated annually).  Search by single year, compare two years, or customized you own parameters.  Here are a couple of examples, comparing all types of services and hospital spending by health insurance and out-of-pocket costs in 1993 and twenty years later in 2013.

In addition to the option to use the interactive feature to create your own reports, the “Chart Collections” section has a bunch of charts and supporting slide decks to choose from:

Drilling down to the question of “How do health expenditures vary across the population?” here are a couple of related supporting slides available for download:

In addition to the interactive tool and chart collections, The Peterson-Kaiser Health System Tracker site provides access to their Insight Briefs and regular blogs.


Healthcare Startups Capitalizing on the Sharing Economy and More

By Clive Riddle, April 1, 2015

These five healthcare lists – courtesy of healthsprocket - should be of great interest today –addressing the sharing economy; King v Burwell; upcoming M&A transactions; headlines you might have missed; and hot innovation initiatives:

Healthcare Startups Capitalizing on the Sharing Economy and More

  1. Uberlance - provide on-demand ambulance services with your SUV
  2. Airpital - rent out your spare rooms for hospital services
  3. PatientGrades - site for doctors to rate their patients
  4. TeleCrowd - crowdsourcing telemedicine - vote on patient's diagnosis & treatment
  5. AirRx - Start a Mail Order Pharmacy with your unused prescriptions

Five Possible Outcomes for SCOTUS King v Burwell Decision

  1. To avoid split tie decision, Scalia and Ginsberg thumb wrestle to settle matter
  2. Court disallows federal funding in states using, with farmer exemption allowing combined corn/healthplan subsidy
  3. Court strikes down Obamacare - Congress passes emergency band-aid bill providing monthly lottery tickets and band-aids to uninsured
  4. Court rules federal subsidies may continue, but not via - strict interpretation requires actual physical marketplace with pop-up tents
  5. Court keeps Obamacare intact - Congress authorizes funding of time travel - terminator cyborg to go back to 2010 and prevent passage of ACA

Four Upcoming Blockbuster Healthcare M&A Transactions to Watch For

  1. UnitedHealthcare acquires states of Florida and Arizona to increase Medicare marketshare
  2. J&J acquires actual cloud covering east coast for cloud-based pharma initiatives - relocates cloud to reduce future employee snow days
  3. Company formerly known as WellPoint acquires copyright to Star Spangled Banner as part of re-branding company as "National Anthem"
  4. HCA acquires Carnival Cruise Lines to create new medical tourism fleet

Important Healthcare Headlines You Might Have Missed

  1. German government delays renown U.S. Clinic's expansion to Hamburg and Frankfurt - puts Mayo on hold
  2. In nod to digital age, doctor offices now feature e-versions of past magazines in patient lobbies using refurbished Apple Newton tablets
  3. Red Cross licenses use of name to Blue Cross Blue Shield plans wishing to re-brand insurance products in Republican states
  4. Concerns mount with new obesity management procedure converting unused part of brain to second stomach
  5. GAO investigation uncovers missing "M" in Centers for Medicare & Medicaid Services acronym

Hot Healthcare Innovation Initiatives

  1. Implantable chip sends you text message letting you know when your knee hurts
  2. McDonalds / CMS partnership pairing choice of Value Meal with each Value-Based payment
  3. Exercise treadmills installed in fast food line queues
  4. StubHub-like app to auction your doctor appointment time
  5. Starbucks Pharmacies dispensing your daily prescription with your latte

The lists provided in Healthsprocket’s annual April 1st edition of the SprocketRocket newsletter. If you’d like to check out similar lists from previous April 1st editions, click here


Looking for the Future in the Past

By Kim Bellard, March 25, 2015

I don't get smartwatches.

Yes, I know; they're all the rage. Apple unveiled its Apple Watch earlier this month, to generally good if not entirely ecstatic reviews. Not to be outdone, Google announced a collaboration with TAG Heuer and Intel for a "Swiss Smartwatch." Samsung and Sony are close behind with their own versions.

Poor Fitbit, which held the early lead in wrist wearables, is now desperately trying to broaden its product line, including the new Surge. They must feel a little like Garmin or Nikon did when mobile phones began to incorporate GPS tracking and digital phones.

I have to wonder why the focus on the wrist. It isn't the ideal place to track, say, your heartbeat, your sleep, or your steps, and as a result fitness trackers have been faulted about their accuracy.  I'm not sure who is clamoring to add more features to a watch.

It's as if Timex and Casio, not to mention TAG Heuer, are conspiring to create a demand so that they don't go the way of Kodak.

It's not that I think they are a bad idea. If you want to wear one, more power to you, and I hope it helps you with your health goals. My problem with them is that I think they are an example of our trying to create the future by looking in the past.

Shouldn't we be developing truly new technologies and uses for them?

I can't help but think about EHRs in this context. Health care providers insisted on being subsidized for what would be normal business process improvement investments for any other industry. What we got for all the federal spending were products that physicians don't really like, that more often hinder than help with patient care, that patients rarely have access to, and that can't easily share data.

We need tools that are more collaborative, more interactive, and more proactive.

Congress is already starting to ask what it has gotten for its $35b HITECH investment, even holding hearings to demand answers. EHRs used to have bipartisan support and now have fairly bipartisan disappointment.

We don't even have an agreed upon way to figure out if providers have the same patient, much less share their data about that patient. The financial services industry solved similar customer-identification problems decades ago. They did it because it made business sense.

In theory, that kind of change will happen once we make that big move to "value-based" care, but as long as our baseline is our current level of spending, I'm skeptical. We need approaches that attempt not just to reduce increases in spending but that aim to take big chunks out of spending. There's no shortage of waste, duplication and unnecessary care that could be eliminated.

Smartwatches, EHRs, or proton beam therapy, to name a few examples, are not likely to help accomplish that.

I want to see those kinds of new technologies in health care, not a smartwatch. Technologies that help change how we think about "health" and how we treat problems with it. I challenge health care technology gurus: show us something not just that we haven't seen before; show us something we hadn't even thought of before

As Alan Kay famously said: "The best way to predict the future is to invent it."

This post is an abridged version of the posting in Kim Bellard’s blogsite. Click here to read the full posting


PwC’s Health Research Institute Gives Us Five

By Clive Riddle, March 20, 2015

Many institutions are pausing to write and reflect on the ACA at this five-year anniversary mark, underneath the pall of the SCOTUS’ King vs. Burwell shadow. PwC’s Health Research Institute has just weighed in with a nice 22-page report : Healthcare reform: Five trends to watch as the Affordable Care Act turns five.

The report lays five key trends on us that they contend the ACA has fueled after five years:

  1. Risk Shift: Raising the stakes for all healthcare players. The ACA added force to new payment models that reward outcomes and penalize poor performance such as high rates of readmission and hospital-acquired conditions.
  2. Primary care: Back to basics. Experimentation in new payment models and expansion of insurance coverage are making primary care once again the critical touch point.
  3. New entrants: Innovators in the New Health Economy. New entrants are rushing into the market to meet the demand for lower-cost, consumer-oriented care options in the post-ACA era. More than 90 new companies have been created since 2010, according to HRI analysis.
  4. Health insurance: From wholesale to retail. Rapid enrollment in the ACA's public exchanges has demonstrated the potential of retail-style health insurance and spawned renewed interest in private exchanges.
  5. States: Reform's pivotal stage. States have emerged as key players in the reconfigured healthcare landscape, as the ACA gave states notable discretion in how the law could be implemented.

Ceci Connolly, managing director of PwC's Health Research Institute, tells us "the five trends have led to the creation of more than 90 new companies that have entered the sector since 2010. The ACA has opened gates for savvy investors and start-ups to take a piece of the $2.9 trillion industry."

And if that isn’t enough, they give us these five takeaways on what stakeholder should consider going forward:

  1. Revisiting strategies to emphasize saving over spending and quality over quantity, to serve more consumers effectively and demonstrate affordability.
  2. Watching closely as the reimbursement pendulum swings from fee-for-service to accountable care.
  3. Innovating to meet the demands of the new healthcare consumer.
  4. Pursuing opportunities to enhance consumer choice and engagement in selecting health benefits.
  5. Working with states as they continue to shape the future landscape.

Prescription Costs Returning to the Wild

By Clive Riddle, March 13, 2015

Numerous studies have been warning that prescription cost increases, domesticated and docile for some time now, have returned to the wild - resurging and rearing their unpleasant head.

During last fall, Evaluate published a new 18-page report , "Budget-busters: The Shift to High-Priced Innovator Drugs in the USA." that addresses the growth of high-end prescription drugs. Evaluate tells us that "the median price of the Top 100 drugs has skyrocketed from $1,260 in 2010 to $9,400 in 2014, representing a seven-fold increase," and that "the average patient population size served by a Top 100 drug in 2014 was 146,000 down from 690,000 in 2010. The number of treatments costing in excess of $100,000 per patient per year rose to seven in 2014 versus four in 2010."

When Segal released their 2015 Segal Health Plan Cost Trend Survey, they stated “Health benefit plan cost trend rates for 2015 are forecast to drop slightly for some coverage, but to increase substantially for prescription drug coverage...…The increase in the cost of prescription drug carve-out coverage for actives and retirees under age 65 is expected to jump to nearly 9 percent. Prescription drug trend for retirees age 65 and older is expected to rise to 7.5 percent, more than twice the rate of retiree medical cost trends. The projected specialty drug/biotech trend rate for 2015 is an exceptionally high 19.4 percent.”

A number of other studies cite similar concerns, and this week Express Scripts weighed in with their annual Drug Trend Report. They state “new hepatitis C therapies with high price tags and the exploitation of loopholes for compounded medications drove a 13.1 percent increase in U.S. drug spending in 2014 – a rate not seen in more than a decade.”

Here’s some key selections from Express Scripts findings:

“Hepatitis C and compounded medications are responsible for more than half of the increase in overall spending. Excluding those two therapy classes, 2014 drug trend (the year-over-year increase in per capita drug spending) was 6.4 percent.”

“Specialty medications – biologic and other high cost treatments for complex conditions, such as multiple sclerosis and cancer – accounted for more than 31 percent of total drug spending in 2014. As Express Scripts forecasted last year, specialty drug trend more than doubled in 2014, to 30.9 percent. Hepatitis C medications accounted for 45 percent of the total increase in specialty spend despite having the second lowest prescription volume among the top 10 specialty conditions. Medicare plans – required to follow Medicare Part D formulary guidelines – were the hardest hit, as their annual specialty drug spend increased 45.9 percent.”

“Spending on traditional classes of medications continues to rise as a result of compounded drugs, which emerged in the top 10 traditional therapy classes for the first time. Despite having the least number of prescriptions among the top 10 classes, compounded medications accounted for 35 percent of the increase in spending, the most of any traditional therapy class of drugs.”

“Drugmaker consolidation and drug shortages also led to increases in traditional drug trend, which rose to 6.4 percent in 2014. Diabetes remains the leading traditional therapy class for a fourth straight year based on total costs; Express Scripts expects double-digit increases in spend in this class over the next three years due to once-weekly oral and injectable drugs in the pipeline.  Cost for medications to treat pain increased 15.7 percent in 2014, due in part to new tamper-resistant formulations for opiates.”

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