Patients Struggle With High Drug Prices – By Joseph Walker December 2015

 Out-of-pocket costs for pricey new drugs leave even some insured and relatively affluent patients with hard choices on how to afford them

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BELLEVILLE, Ill.— Jacqueline Racener ’s doctor prescribed a new leukemia drug for her last winter that promised to roll back the cancer in her blood with only moderate side effects.

Then she found out how much it would cost her: nearly $8,000 for a full year, even after Medicare picked up most of the tab.

“There’s no way I could do that,” Ms. Racener says. “It was just prohibitive.” Worried about depleting her limited savings, Ms. Racener, a 76-year-old legal secretary, decided to take the risk and not fill her prescription.

The pharmaceutical industry, after a long drought, has begun to produce more innovative treatments for serious diseases that can extend life and often have fewer side effects than older treatments. Last year, the Food and Drug Administration approved 41 new drugs, the most in nearly two decades.

The catch is their cost. Recent treatments for hepatitis C, cancer and multiple sclerosis that cost from $50,000 annually to well over $100,000 helped drive up total U.S. prescription-drug spending 12.2% in 2014, five times the prior year’s growth rate, according to the Centers for Medicare and Medicaid Services. High drug prices can translate to patient costs of thousands of dollars a year. Out-of-pocket prescription-drug costs rose 2.7% in 2014, according to CMS.

For many of the poorest Americans, medicines are covered by government programs or financial-assistance funds paid for by drug companies.

For those in the middle class, it is a different story. Though many patients can get their out-of-pocket costs paid by drug companies or drug-company-funded foundations, some patients make too much money to qualify for assistance. Others are unaware the programs exist. Medicare patients, who represent nearly a third of U.S. retail drug spending, can’t receive direct aid from drug companies.

The upshot is even patients with insurance and comfortable incomes are sometimes forced to make hard choices—tapping savings, taking on new debt or even forgoing treatment.

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Jeb Bush endorses “death panels” — and he’s right to do so – Updated by Ezra Klein on April 17, 2015, 3:30 p.m. ET

Richard Ellis/Getty Images

The dumbest controversy of Obamacare, by far, was when Sarah Palin took an anodyne provision directing Medicare to cover end-of-life care consultations and branded it a “death panel.” Senator Johnny Isakson, a Georgia Republican who had backed the idea, was unsparing. “How someone could take an end-of-life directive or a living will as that is nuts,” he said. PolitiFact gave Palin its coveted “Lie of the Year” award.

But Palin won. The provision was deleted from the bill. And politicians learned to fear any discussion of end-of-life care, even though roughly 30 percent of Medicare’s spending comes in the last six months of a patient’s life.

And that’s been the sorry state of Washington’s conversation over end-of-life care. Until now.

In New Hampshire on Friday, Jeb Bush made a startlingly sensible proposal. “I think if we’re going to mandate anything from government, it might be that if you’re going to take Medicare, you also sign up for an advance directive,” the New York Times reports Bush saying.

This goes much further than the provision in Obamacare. All that did was allow Medicare to pay for “voluntary advance care planning.” Bush appears to be suggesting something much more radical, and much more sensible: that Medicare mandates an advance directive as a condition of receiving insurance.

This shouldn’t scare anyone. An advance directive can say that the patient wants all measures used to prolong her life, or it can say that the patient wants nothing done. An advance directive doesn’t tell you what to choose; it simply forces you to make a choice.

And people should be forced to make a choice. Because if they don’t, then terrible things can happen to them at a point when they’re no longer mentally or physically capable of choosing.

“End-of-life care” is such a clean euphemism. But CPR cracks the ribs of 92-year-olds with dementia. Brutal surgeries are performed that will leave patients with a few more months of life, at best. There are fates that are worse than death. As one doctor wrote:

Almost all medical professionals have seen what we call “futile care” being performed on people. That’s when doctors bring the cutting edge of technology to bear on a grievously ill person near the end of life. The patient will get cut open, perforated with tubes, hooked up to machines, and assaulted with drugs. All of this occurs in the Intensive Care Unit at a cost of tens of thousands of dollars a day. What it buys is misery we would not inflict on a terrorist. I cannot count the number of times fellow physicians have told me, in words that vary only slightly, “Promise me if you find me like this that you’ll kill me.” They mean it. Some medical personnel wear medallions stamped “NO CODE” to tell physicians not to perform CPR on them. I have even seen it as a tattoo.

And then there’s the awful suffering of the patient’s family when they are forced to make life-or-death decisions for a loved one who never made clear the circumstances under which he wanted to live or die.

It’s the latter kind of pain that is motivating Bush: he frames his belief in advance directives as the result of his experience trying to help Terry Schiavo’s parents keep her alive, even when her husband said that she had never wanted to persist in a vegetative state.

But whatever the motivation for Bush’s idea, it’s a good one, and it hopefully heralds a presidential race in which the candidates will be willing to talk about end-of-life care like adults.

Obama just approved a $214 billion plan to fix Medicare. That’s a big deal. – Updated by Sarah Kliff on April 16, 2015, 4:59 p.m. ET

President Obama signed a $214 billion Medicare reform package late Thursday that will overhaul the entitlement program funding — and has strong backing from both political parties.

The Medicare Access and CHIP Reauthorization Act, or MACRA, managed to overcome Congressional gridlock — passing the Senate with a 92 to 8 vote — because it does something nearly everyone in Washington supports: repeals the current Medicare funding formula.

That’s a big deal: the two parties have tried to do this for than a decade, but to no avail. They always got hung up on where to find the funds to pay for a decade-long increase to doctor salaries.

The source of this whole problem is an aging law on the books that mandates a double-digit pay cut for Medicare doctors every so often because it doesn’t provide enough funding to keep salaries steady. But instead of letting those pay cuts go into effect, Congress always scrounges up extra billions to save doctors’ salaries.

This time around, legislators decided, in part, to stop caring about the cost. They passed a permanent doc-fix that, while partially paid-for, is still expected to raise the deficit by $141 billion over the next decade.

While the Medicare overhaul will come into force with strong political backing, health policy experts have already raised concerns about whether MACRA will actually improve the Medicare program — or come with its own, new set of problems.

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Parties play post ‘vote-a-rama’ gotcha game – By Rachael Bade and Seung Min Kim 4/4/15 8:45 AM EDT Updated 4/4/15 8:45 AM EDT

POLITICO illustration / AP and iStock

Coming soon to a Senate race near you: ugly attack ads slamming Republicans for voting to privatize Medicare, while Democrats get blasted for pushing new carbon taxes on everyday Americans.

Welcome to the 2016 election after the Senate’s budget “vote-a-rama,” where senators cast dozens of votes, failed to change one law, and yet still gave their campaign committees an arsenal of political ammunition.

Because the budget is a non-binding blueprint, all the “yeas” and “nays” from the vote-a-rama didn’t have any real-world impact. But the dozens of ballots gave each party a chance to make the other look bad. Democrats forced the GOP to take positions on issues spanning climate change to the minimum wage. Not to be outdone, Republicans scored some points by forcing Democrats to vote against tax cuts and their own living-wage proposal.

The Democratic Senatorial Campaign Committee and National Republican Senatorial Committee have already fired opening shots based off budget votes, as they compile the list of roll calls they’ll use in advertisements against senators up for re-election. Those budget votes could be fodder for attack ads against senators in swing states — including Rob Portman (R-Ohio), Michael Bennet (D-Colo.) and Mark Kirk (R-Ill.).

Here’s a look at the votes from last week that will likely have a long political shelf-life:

Equal pay

On pay equity, Democrats and Republicans tried different strategies to woo women voters.

The two sides offered dueling amendments aimed at narrowing the pay gap between men and women — but with different ways of getting there.

The Democrats’ version, like their much-touted Paycheck Fairness Act that was blocked by the GOP in past years, makes it easier for women to sue for punitive damages and bans retaliation against employees for sharing salary information.

But Republicans have argued that the Democratic plan would be a litigation bonanza. To counter, the GOP offered up a proposal from Sen. Deb Fischer (R-Neb.), which also tries to stop retaliation against workers who discuss salary details but has no lawsuit provision.

Fischer called her measure a “reasonable, fact-based approach” but Democrats begged to differ. During the floor debate, Sen. Patty Murray (D-Wash.) called the Democratic plan “the only proposal on the table right now” that would help close the gender pay gap.

Fischer’s amendment passed with all Republicans and two Senate Democrats voting in favor: Joe Donnelly of Indiana and independent Angus King of Maine. No Republicans sided with Democrats on their pay equity bill, and King voted against it as well.


“Ending Medicare as we know it” has been a Democratic refrain ever since Rep. Paul Ryan (R-Wis.) introduced his plan to dramatically reform the health care program for seniors — and this election cycle will be no exception.

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How Boehner, Pelosi surprised everyone with a $200 billion deal – By Peter Sullivan – 03/28/15 06:07 AM EDT

A few days after the chaos of a failed vote to fund the Department of Homeland Security, Speaker John Boehner asked for a meeting, alone, with House Democratic Leader Nancy Pelosi.

Compromise was on his mind.

Greg Nash

With automatic cuts to doctors under Medicare set to take effect at the end of March, Boehner (R-Ohio) wanted to explore the possibility of a deal that would end the Sustainable Growth Rate (SGR), and with it a problem that has dogged Congress for nearly two decades.

The March 4 meeting in Pelosi’s (D-Calif.) office on the second floor of the Capitol was brief, lasting only 11 minutes.

But on the central question that has for years thwarted deal making between the parties — whether to raise taxes — Boehner got the answer he was looking for.

Democrats would not insist on tax hikes in legislation ending the Medicare formula, Pelosi told Boehner.

“That was, from our point of view, the breakthrough,” said Michael Steel, a Boehner spokesman.

Democrats say the Medicare package is on an entirely different scale than the $4 trillion deficit-reduction package that President Obama and Democrats sought to negotiate with Republicans in 2011. Those talks broke down over the question of raising taxes, with both sides leveling bitter accusations over who was unwilling to bend.

A Democratic aide familiar with the Medicare talks called the comparison to the 2011 negotiations “not apples and oranges, but apples and baseball bats.”

Democrats view it is a victory that two-thirds of the deal is not paid for, that it includes priorities like funding for the Children’s Health Insurance Program, and that Boehner did not insist on cuts to health programs that they thought would be harmful.

On Thursday, three weeks after the Boehner-Pelosi meeting, the Medicare deal passed the House in an overwhelming, bipartisan vote of 392-37.

The roughly $200 billion package, which is now awaiting action from the Senate, would be partially paid for, with a mix of cuts to healthcare providers and measures requiring wealthier Medicare beneficiaries to pay a higher share of premiums.

President Obama has said he is ready to sign the bill, which would lift the threat of payment cuts to doctors who treat Medicare patients.

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Fancy Hospital Flourishes Often Fail To Impress Patients – JORDAN RAU FEBRUARY 24, 201511:10 AM ET

The sleek hospital tower that Johns Hopkins Medicine built in 2012 has the frills of a luxury hotel, including a meditation garden, 500 works of art, free wi-fi and a library of books, games and audio.

When Johns Hopkins Medicine opened gleaming new clinical buildings, it created a natural experiment to gauge patient satisfaction.

When Johns Hopkins Medicine opened gleaming new clinical buildings, it created a natural experiment to gauge patient satisfaction. Johns Hopkins Medicine

As Dr. Zishan Siddiqui watched patients and some fellow physicians in Baltimore move from their decades-old building into the Sheikh Zayed Tower, the internist saw a rare opportunity to test a widespread assumption in the hospital industry: that patients rate their care more highly when it is given in a nicer place.

For decades, hospital executives across the country have justified expensive renovation and expansion projects by saying they will lead to better patient reviews and recommendations. One study estimated $200 billion might have been spent over a decade on new building. Hopkins’ construction of the tower and a new children’s hospital cost $1.1 billion. Patient judgments have become even more important to hospitals since Medicare started publishing ratings and basing some of its pay on surveys patients fill out after they have left the hospital.

Siddiqui’s study, published this month by the Journal of Hospital Medicine,contradicts the presumption that better facilities translate into better patient reviews. Siddiqui examined how patient satisfaction scores changed when doctors started practicing in the new tower, which has 355 beds and units for neurology, cardiology, radiology, labor and delivery and other specialties.

Siddiqui discovered that for the most part, patients’ assessments of the quality of the clinical care they received did not improve any more than they did for patients treated in the older Hopkins building, which had remained open. Units there were constructed as early as 1913 and as late as 1980, Hopkins officials said. They functioned as the control group in the study, since a hospital’s satisfaction scores often change over time even when a hospital’s physical environment remains constant.

The study used the responses both to Medicare-mandated surveys and private ones from Press Ganey, a consulting company that administers surveys. In the study, Hopkins patient ratings about the cleanliness and quiet in new tower’s rooms—elements Medicare uses in setting pay—soared, as did views on the pleasantness of the décor and comfort of the accommodations. But patient opinions about their actual care – such as the communication skills of doctors, nurses and staff — didn’t rise any higher than they did in the older building.

“Despite the widespread belief among healthcare leadership that facility renovation or expansion is a vital strategy for improving patient satisfaction, our study shows that this may not be a dominant factor,” Siddiqui and his fellow authors wrote.

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That’s where the money is – May 31st 2014

How to hand over $272 billion a year to criminals

MEDICAL science is hazy about many things, but doctors agree that if a patient is losing pints of blood all over the carpet, it is a good idea to stanch his wounds. The same is true of a health-care system. If crooks are bleeding it of vast quantities of cash, it is time to tighten the safeguards.

In America the scale of medical embezzlement is extraordinary. According to Donald Berwick, the ex-boss of Medicare and Medicaid (the public health schemes for the old and poor), America lost between $82 billion and $272 billion in 2011 to medical fraud and abuse (see article). The higher figure is 10% of medical spending and a whopping 1.7% of GDP—as if robbers had made off with the entire output of Tennessee or nearly twice the budget of Britain’s National Health Service (NHS).

Crooks love American health care for two reasons. First, as Willie Sutton said of banks, it’s where the money is—no other country spends nearly as much on pills and procedures. Second, unlike a bank, it is barely guarded.

Some scams are simple. Patients claim benefits to which they are not entitled; suppliers charge Medicaid for non-existent services. One doctor was recently accused of fraudulently billing for 1,000 powered wheelchairs, for example. Fancier schemes involve syndicates of health workers and patients. Scammers scour nursing homes for old people willing, for a few hundred dollars, to let pharmacists supply their pills but bill Medicare for much costlier ones. Criminal gangs are switching from cocaine to prescription drugs—the rewards are as juicy, but with less risk of being shot or arrested. One clinic in New York allegedly wrote bogus prescriptions for more than 5m painkillers, which were then sold on the street for $30-90 each. Identity thieves have realised that medical records are more valuable than credit-card numbers. Steal a credit card and the victim quickly notices; photocopy a Medicare card and you can bill Uncle Sam for ages, undetected.

It is hard to make such a vast system secure: Medicare’s contractors process 4.5m claims a day. But pointless complexity makes it even harder. Does Medicare really need 140,000 billing codes, as it will have next year, including ten for injuries that take place in mobile homes and nine for attacks by turtles? A toxic mix of incompetence and political gridlock has made matters worse. Medicare does not check new suppliers for links to firms that have previously been caught embezzling (though a new bill aims to fix this). Fraud experts have long begged the government to remove Social Security numbers from Medicare cards to deter identity thieves—to no avail.

Start by closing the safe door

One piece of the solution is obvious: crack down on the criminals. Obamacare, for all its flaws, includes some useful measures. Suppliers are better screened. And when Medicaid blackballs a dodgy provider, it now shares that information with Medicare—which previously it did not. For every dollar spent on probing health-care fraud, taxpayers recover eight. So the sleuths’ budgets should be boosted, not squeezed, as now.

But the broader point is that American health care needs to be simplified. Whatever its defects, Britain’s single-payer National Health Service is much simpler, much cheaper and relatively difficult to defraud. Doctors are paid to keep people well, not for every extra thing they do, so they don’t make more money by recommending unnecessary tests and operations—let alone billing for non-existent ones.

Too socialist for America? Then simplify what is left, scale back the health tax-perks for the rich and give people health accounts so they watch the dollars that are spent on their treatment. After all, Dr Berwick’s study found that administrative complexity and unnecessary treatment waste even more health dollars than fraud does. Perhaps that is the real crime.

Release of Medicare doctor payments shows some huge payouts – By Chad Terhune, Noam N. Levey and Doug Smith April 8, 2014, 9:00 p.m.

Medicare doctor payments revealed

Ending decades of secrecy, Medicare is showing what the giant healthcare program for seniors pays individual doctors, and the figures reveal that more than a dozen physicians received in excess of $10 million each in 2012.

The Obama administration is releasing a detailed account Wednesday of $77 billion in government payouts to more than 880,000 healthcare providers nationwide that year. The release of payment records involving doctors has been legally blocked since 1979, but recent court rulings removed those obstacles. No personal information on patients is disclosed.

The two highest-paid doctors listed in the Medicare data are already under government review because of suspected improper billing. They include an ophthalmologist in the retiree haven of West Palm Beach, Fla., who topped the list by taking in more than $26 million to treat fewer than 900 patients. That is 61 times the average Medicare payout of $430,000 for an ophthalmologist.

A Florida cardiologist received $23 million in Medicare payments in 2012, nearly 80 times the average amount for that specialty. One California doctor was in the top 10 nationwide: a Newport Beach oncologist who was paid $11 million that year.

The overwhelming majority of doctors billed the government very modest amounts. Overall, 2% of healthcare providers accounted for 23% of the Medicare fees, the federal data show.

Medicare officials said disclosing physician payment data marks an unprecedented opportunity to make the nation’s healthcare system more transparent for consumers and accountable to taxpayers. Many consumer advocates and employers applauded the move.

“Providing consumers with this information will help them make more informed choices about the care they receive,” Jonathan Blum, Medicare’s principal deputy administrator, said last week. Medicare plans to post the data online.

Still, federal officials cautioned against drawing sweeping conclusions about individual doctors from the numbers. High payouts do not necessarily indicate improper billing or fraud, they say. Payments could be driven higher because providers were treating sicker patients who required more treatment or because their practice was focused more on Medicare patients.

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Medicare to Cover More Mental Health Costs – By JUDITH GRAHAM December 27, 2013, 6:46 pm

For decades, older adults with depression, anxiety and other psychological conditions have received unequal treatment under Medicare. The program paid a smaller share of the bill for therapy from psychiatrists, psychologists or clinical social workers than it did for medical services. And Medicare imposed strict lifetime limits on stays in psychiatric hospitals, although no such limits applied to medical care received in inpatient facilities.

There was never a good rationale for this disparity, and in 2008 Congress passed the Medicare Improvements for Patients and Providers Act. The law required Medicare to begin covering a larger share of the cost of outpatient mental health services in 2010 and to phase in additional increases over time.

On Jan. 1, that process will be complete, and for the first time since Medicare’s creation seniors who seek psychological therapy will be responsible for 20 percent of the bill while Medicare will pay 80 percent, the same percentage it covers for most medical services. (Payment kicks in once someone exhausts an annual deductible — $147 next year.)

In 2008, Medicare covered 50 percent of the cost of psychological treatment. Last year, it covered 65 percent.

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Hospice firms draining billions from Medicare – By Peter Whoriskey and Dan Keating, Published: December 26

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Hospice patients are expected to die: The treatment focuses on providing comfort to the terminally ill, not finding a cure. To enroll a patient, two doctors certify a life expectancy of six months or less.

But over the past decade, the number of “hospice survivors” in the United States has risen dramatically, in part because hospice companies earn more by recruiting patients who aren’t actually dying, a Washington Post investigation has found. Healthier patients are more profitable because they require fewer visits and stay enrolled longer.

The proportion of patients who were discharged alive from hospice care rose about 50 percent between 2002 and 2012, according to a Post analysis of more than 1 million hospice patients’ records over 11 years in California, a state that makes public detailed descriptions and that, by virtue of its size, offers a portrait of the industry.

The average length of a stay in hospice care also jumped substantially over that time, in California and nationally, according to the analysis. Profit per patient quintupled, to $1,975, California records show.

This vast growth took place as the hospice “movement,” once led by religious and community organizations, was evolving into a $17 billion industry dominated by for-profit companies. Much of that is paid for by the U.S. government — roughly $15 billion of industry revenue came from Medicare last year.

At AseraCare, for example, one of the nation’s largest for-profit chains, hospice patients kept on living. About 78 percent of patients who enrolled at the Mobile, Ala., branch left the hospice’s care alive, according to company figures. As many as 59 percent of patients left the AseraCare branch in nearby Foley, Ala., alive. And at the one in Monroeville, 48 percent were discharged from the hospice alive.

“It was definitely good news,” said Bessie Blount, whose father received hospice care from the Monroeville outfit and left after about a year, she said.

About three years later, her father, Chocolate Blount, 91, is still alive.

“He has good days and bad days,” she said.

Incentive to recruit patients

The work that the hospice nurses, aides and counselors do, often in the most trying circumstances, is demanding, emotionally and physically. It typically allows patients to die at home or in other familiar surroundings — and for families of the dying, the comfort it offers can provide enormous relief.

But the survival rates at AseraCare are emblematic of a problem facing Medicare, which has created a financial incentive for hospice companies to find patients well before death.

Medicare pays a hospice about $150 a day per patient for routine care, regardless of whether the company sends a nurse or any other worker out on that day. That means healthier patients, who generally need less help and live longer, yield more profits.

The trend toward longer stays on hospice care may be costing Medicare billions of dollars a year.

In 2011, nearly 60 percent of Medicare’s hospice expenditure of $13.8 billion went toward patients who stay on hospice care longer than six months, MedPAC, the Medicare watchdog group created by Congress, has reported.

Some of those patients simply outlived a legitimate prognosis of six months.

But much of the data suggests that the trend toward longer stays is a response to the financial incentive.

Consider the difference between the nonprofit and for-profit hospices: While the average nonprofit serves a patient for 69 days, the average for-profit hospice serves a patient for an average of 102 days, according to MedPAC.

Read the rest of this comprehensive article here: