I saw an Aetna advertisement for its online personal health record (PHR) tool last Thursday on NBC and last night on CBS. The brief advertisement showed a woman inputting information about an over the counter (OTC) prescription into her online PHR and then the PHR responds with a warning about a potential conflict between the OTC drug and a prescription drug that also was recorded on the PHR. The ad explains that the warning also is sent to the woman’s doctor. Should the alert be sent directly to the doctor? This creates additional work and liability for the doctor, and it strikes me that the patient should be making the call on whether to consult the doctor. It may be that the patient has been taking both drugs for a long time without any side effects.

In all likelihood the warning to the doctor is an optional feature of the Aetna tool, but I am always interested in the second bounce of the ball. I read an editorial in the AMA News last week about the medical community’s dissatisfaction with e-prescribing 1.0. One of the complaints was too many drug interaction warnings.

The Wall Street Journal is reporting that

Caremark Rx shareholders voted to approve a $26.5 billion takeover offer from drugstore operator CVS. The approval capped a monthslong bidding war between CVS and Express Scripts for the pharmacy-benefits manager. Express Scripts’ offer was higher than CVS’s, at about $27.2 billion, but would’ve taken longer to clear regulatory hurdles.

The CVS shareholders vote on the company’s merger proposal tomorrow and the Caremark shareholders vote on Friday. Last month, three major proxy advisory services advised Caremark shareholders against the CVS bid. This time around, after CVS has sweetened the deal, two firms Glass Lewis & Co. and Proxy Governance continue to oppose the CVS deal while Institutional Shareholder Investors recommends an aye vote, according to Reuters.

Forbes reports that “Last week, both CVS and Express Scripts had outstanding cash and stock offers for Caremark of about $26.5 billion. However, price shifts and Monday closings tweaked those offers to about $26.14 billion from CVS, and about $27.28 billion from Express Scripts.”

All that’s left are a couple more tweaks and the votes.

At its March 13 meeting, HHS’s American Health Information Community approved, with some dissension, a consumer empowerment workgroup recommendation that product certification be made available for insurer record based personal health records, according to Government HIT magazine and Healthcare IT News. The dissidents complained that certification is premature and could stifle innovation.

Modern Healthcare.com is reporting that the White House has rejected the “key ideas” of the Congressionally mandated Citizens’ Health Care Working Group: “In written comments to Congress and to the group, administration officials said that ‘the working group chose an approach based on mandates and government intervention rather than an approach emphasizing consumer choice and options. In reviewing the working group’s report, we have major concerns with some of the recommendations.'”

The Wall Street Journal featured a fascinating article by Sarah Rubenstein yesterday on generic drug costs (freely accessible reprint from the Pueblo Chieftain). At last week’s FEHBP carrier conference, prescription benefit management company representatives explained how generic drug costs will not dip much below the brand name price during the 180 day period during which the generic manufacturer who won the race to challenge the patent has exclusive sales rights. Ms. Rubenstein’s article points out that pharmacies may be trying to maintain the relatively high generic price after the expiration of the exclusivity period (although I expect this is a high retail price not the price paid by the PBMs.) There is a lot more flexibility on pricing generics as compared to brand name drugs because generic drugs are not subject to the Medicaid best pricing requirement. In fact, I understand that generic drugs are more expensive in Canada than they are here. Medicaid’s best price rules are changing, however, and I am not certain how those changes will impact generic pricing for health plans and consumers.

This week, Rep. Patrick Kennedy (D R.I.), Rep. Jim Ramstad, and 254 co-sponsors introduced a mental health parity bill (H.R. 1367) that is stronger than the bill that his father’s (Sen. Ted Kennedy (D Mass.)) HELP committee cleared in the Senate. Although the text of the bill has not yet been posted, Business Insurance explains that

The House measure is different in at least two significant ways. While the Senate bill would pre-empt state laws mandating cost-sharing and treatment parity for mental health care services, the House bill would allow states to set stronger standards. Additionally, while the Senate bill would leave it to employers to decide on which mental disorders they will cover, the House bill mandates that employer plans would have to provide coverage for the same range of mental disorders and illnesses which are covered by federal health care plans available to members of Congress.

Infozine reports that “Congressman Patrick Kennedy (D-RI) told policymakers and mental health advocates [yesterday at the Bazelon Center for Mental Health law) that letting insurance companies define mental illness when setting limits on coverage is ‘bogus.'” However, provider and industry groups have coalesced around the Senate bill.

As you know, the HIPAA National Provider Identifier compliance date is May 23, 2007. At long last, HHS has submitted the critically important National Plan and Provider Enumeration System (NPPES) Data Dissemination policy to the Office of Management and Budget OMB) for final review before publication in the Federal Register. AGENCY: HHS-CMS RIN: 0938-AN71 TITLE: National Plan and Provider Enumeration System (NPPES) Data Dissemination (CMS-6060-NC) STAGE: Notice ECONOMICALLY SIGNIFICANT: No RECEIVED DATE: 02/26/2007 LEGAL DEADLINE: None
Hopefully OMB will complete its review quickly and health plans will see the policy this month.

At the FEHBP conference, I learned about a new legislative initiative that frankly was not on my radar screen — permitting the Food and Drug Administration to approve generic versions of expensive biological or specialty drugs. A biological drug is “a substance that is made from a living organism or its products and is used in the prevention, diagnosis, or treatment of cancer and other diseases. Biological drugs include antibodies, interleukins, and vaccines.” Biological drugs tend to be quite expensive.

In 1984 the Hatch Waxman Act “opened the pathway” for FDA approval of generic versions of drugs made from chemical compounds, but not biologicals. Rep. Waxman has introduced a bill (H.R. 1038) to open the same pathway for biologicals, nicknamed biogenerics. The Senate HELP committee held a hearing on the issue and a related Senate bill yesterday, and at the FEHBP carrier conference several speakers talked about the importance of this bill in reducing health care costs. The biological drug manufacturers contend that biogenerics will impair their development efforts and also that it is more difficult to prove that biogenerics are equivalent to the brand name generic which is the quid pro quo for generic status. Biogenerics are on my radar screen now.

OPM held its annual FEHB Program conference today. (I attended and it was an excellent program.) In recognition of this event, OPM released its “call letter” for 2008 benefit and rate proposals. I cannot recall an earlier date of call letter issuance.

This call letter kicks off the carriers’ process of preparing benefit and rate proposals that are due on May 31. OPM expects to complete negotiations by August 15, and then the Open Season will be held from early November to early December.

OPM announced in the call letter that for 2008 it will allow community rated HMO’s participating in the FEHBP to offer alternate benefit benefit packages subject to OPM approval. Currently those plans are restricted to offering the same community benefits package that the greatest number of non-Federal subscribers purchased in the prior year.

OPM also is encouraging hearing benefits for newborns and children, and the agency is prohibiting enhanced FEHBP dental benefits due to the new FEDVIP program.

Otherwise the call letter endorses the Administration’s health care initiatives, such as the Executive Order on HIT and health savings accounts.