The HHS Office for Civil Rights, which enforces HIPAA’s Privacy Rule, has released guidance for covered entities and business associates to describe information flows in the event of an emergency, such as Hurricane Katrina. Covered entities should consider incorporating this guidance in their Privacy Policies and Procedures.
Last week, HHS sponsored a Nationwide Health Information Network (NHIN) Forum. The NHIN will be the backbone of the Nation’s developing electronic medical records system. 500 people attended (the admission charge was only $50). Government HIT magazine reports that the attendees had a lot of questions and comments. The National Committee on Vital and Health Statistics will be considering these comments as it develops a privacy and security oriented requirements document for the NHIN over the summer. In addition, four HHS-contracted consortia — are developing and assessing different NHIN models. For what it’s worth, I have been most impressed by the Connecting for Health Common Framework model developed in partnership with CSC. For more details, Oracle has created a NHIN Watch.
Since 1992, Medicare has reimbursed physicians services pursuant to a resource based relative value schedule. The American Medical Association explains that
In the RBRVS system, payments for services are determined by the resource costs needed to provide them. The cost of providing each service is divided into three components: physician work, practice expense and professional liability insurance. Payments are calculated by multiplying the combined costs of a service by a conversion factor (a monetary amount that is determined by the Centers for Medicare and Medicaid Services). Payments are also adjusted for geographical differences in resource costs.
Many health plans utilize the RBRVS to establish the basis for compensating network providers.
At least every five years, CMS must reevaluate the RBRVS. The most recent re-evaluation was published in the Federal Register on June 29. CMS’s press release explains that
The proposed notice includes substantial increases for “evaluation and management” services, that is, time and effort that physicians spend with patients in evaluating their condition, and advising and assisting them in managing their health. The changes reflect the recommendations of the Relative Value Update Committee (RUC) of the American Medical Association. “It’s time to increase Medicare’s payment rates for physicians to spend time with their patients,” said CMS Administrator Mark McClellan, M.D., Ph.D. “We expect that improved payments for evaluation and management services will result in better outcomes, because physicians will get financial support for giving patients the help they need to manage illnesses more effectively.” These are the largest revisions ever proposed for services related to patient evaluation and management. For example, the work component for RVUs associated with an intermediate office visit, the most commonly billed physician’s service, will increase by 37 percent. The work component for RVUs for an office visit requiring moderately complex decision-making and for a hospital visit also requiring moderately complex decision-making will increase by 29 percent and 31 percent respectively. Both of these services rank in the top 10 most frequently billed physicians’ services out of more than 7,000 types of services paid under the physician fee schedule. Medicare law requires that CMS impose a budget neutrality adjustment if changes in RVUs will cause an increase or decrease in overall fee schedule outlays of more than $20 million, compared with what they would have been in the absence of the changes. CMS estimates that the proposed work RVU changes would increase expenditures by approximately $4.0 billion. CMS is proposing to create a separate budget neutrality adjuster that can be applied just to the work RVUs for Medicare purposes, without changing the number of work RVUs assigned to a particular service. This would preserve the integrity of the existing work RVU structure, which is often adopted by other payers.
CMS will be accepting comments until August 21 and it plans to announce the final policy changes in November and implement the revised RBRVS on January 1, 2007, subject to a phase in period.
OPM has an FAQ page on prescription drug coverage which states that
A. There is no evidence of this. The FDA monitors reports of adverse drug reactions and has found no difference in the rates between generic and brand name drugs.However, the Washington Post reports today in its health section about a Medco survey finding that 27% of physicians are of the opinion that generic drugs are more likely to produce unwanted side effects than brand name drugs (in contrast to 5% of pharmacists and 10% of consumers).
Pfizer‘s iconic anti-depressant drug Zoloft just lost its patent protection. Pfizer announced that its Greenstone Ltd subsidiary would manufacture an “authorized generic” version of Zoloft. If an independent generic drug manufacturer brings a successful patent challenge against a brand name drug, then that manufacturer (and the brand name manufacturer) share an exclusive right to market the generic drug for the first 180 days after the patent expires under the Hatch Waxman amendments to the federal Food and Drug Act.
If the brand name manufacturer does not license or manufacture its own authorized generic, then it’s clear sailing for the independent company, such as Teva, to gain market share. But if the independent must compete with an authorized generic, then the generic price drops even lower (50% of the brand name price according to the Wall Street Journal as compared to a 35% to 40% average dip when the independent generic manufacturer has no competition. The U.S. stock price of Teva, which now will be competing with Pfizer for sale of generic Zoloft, dropped 3% on Friday on the news. (Pfizer was up 1% on Friday.)
On Thursday, the Food and Drug Administration approved the use of Celgene‘s drug Revlimid to treat patients with relapsed or recurring multiple myeloma. Trial data has shown the Revlimid, which is a pill, combined with a steroid boosts the survival rate of these patients by a year or more.
According to Reuters, the manufacturer will price the drug at more than $6,000 a month for the highest, 25 milligram, dose. Today’s Wall Street Journal (subscription wall) observes an industry trend of aggressively pricing cancer drugs while creating a safety net for the uninsured. The Journal quotes a Morgan Stanley analyst Sapna Srivastava, “Every time a [cancer] drug is priced, it’s higher.” Other examples are Genentech’s Avastin and Bristol Myers Squibb/Imclone’s Erbitux. Recently Bristol Myers declined to market Eribitux in Canada because of pricing concerns. This strategy has been noted for over two years with no no end apparently in sight.
On June 29, The Human Rights Campaign, a gay advocacy organization, released a report showing that 51% of Fortune 500 companies now extend health benefits to the domestic partners of their employees — double the number since 2000. Under the Federal Employees Health Benefits Act, self and family coverage is limited to the “spouses” of employees, and pursuant to the Defense of Marriage Act, a spouse is “a person of the opposite sex who is a husband or a wife.”
A U.S. Centers for Disease Control advisory panel has approved the practice of routinely immunizing 11 and 12 year old girls with the new HPV vaccine Gardasil. The panel also recommended that girls and women aged 13 to 26 should receive the vaccination on the advice of their doctors According to Medical News Today,
“Two HPV strains are responsible for causing 70% of all cervical cancers. Gardasil protects females from these two strains. It also protects against two other strains that are responsible for most genital warts. The treatment consists of three injections, spread over six months.” The whole course costs $360, which reportedly is a high price for a vaccination.
Wellpoint, a large Blues organization, has already announced that it will begin Gardasil coverage. Gardasil is a Merck vaccine.
It’s well known that employer sponsored health insurance took off during World War II when the federal government’s wage and price controls did not extend to “non-cash” benefits. Moreover, the federal tax code has excluded employer sponsored health insurance premiums from taxation. As part of the consumer driven health care movement, a number of policymakers, including the President’s Advisory Panel on Federal Tax Reform, are recommending that the tax landscape which now continues to favor employer sponsored health insurance over individually purchased health insurance be levelled out. In fact, this in one component of the President’s recent package of health savings account improvements.
The Employee Benefit Research Institute (EBRI) recently issued a report analyzing the four major reform proposals. EBRI observes therein (p. 26) that
“The assertion that the tax subsidy of employment-based coverage distorts
the market for health insurance and therefore creates an inefficient allocation of resources is based on the assumption that the tax subsidy is the only reason the market for health care services is inefficient. If there are other factors preventing the health care financing and delivery system from performing optimally, however, the “theory of second best” suggests that removing the tax incentive may not increase social welfare. Since health insurance coverage produces a number of positive external societal benefits, withdrawing the current tax incentive implicitly would suggest that individuals would obtain less-than optimal medical care. Currently, that incentive is provided through an employment-based system that has systemic efficiencies that an individual-based system would not be able to equal. “
The stolen Veterans Affairs Department laptop and storage media with personal data on 26.5 million veterans has been recovered. The initial report is that the personal data was not accessed after the theft.
On a related note, the U.S. Office of Management and Budget issued standards for securing remotely held information, e.g., protected data stored on a laptop.