Archive | February, 2012

NACDS on George Paz Quote

Apparently George Paz, the CEO of Express Scripts, had the following quote the other day that has upset NACDS:

“At the end of the day … Nexium is Nexium, Lipitor is Lipitor, drugs are drugs, and it shouldn’t matter that much who’s counting to 30.”

Are you offended by this quote? If I reverse this, then I guess it doesn’t matter which specialty pharmacy a patient uses, but we all know that pharmacy is a lot more than pill counting (or should be).

I’ve talked about my vision of the future before which is where pharmacists can leverage technology more for prepackaged drugs (especially with low cost oral solids) and long-term patients while their expertise is leveraged in counseling and helping patients understand their drugs and conditions. This is crucial to the healthcare system.

So, while I can exploit the quote to drive an emotional response, isn’t the point that counting doesn’t matter but delivery of the medication and interaction with the patient does matter?

What $6B Could Do For Adherence?

I keep thinking about the $4-$6B that the Visante Study estimated was being spent by pharma on copay cards and how that money could drive overall adherence.

Here’s my thought:

  • If 50% of Americans are taking a chronic medication, there are ~170M people to spend this money on.
  • We can safely assume that 20-40% of this population is adherent without additional investment.
  • We therefore have 119M patients (midpoint) across which to spend $5B (midpoint).
  • This means we have about $42 per patient per year to spend on utilization.
  • Based on work I’ve participated in and work I’ve seen my clients do, I know you could raise adherence by ~10 percentage points by some simple intervention programs that would cost much less than $10 per patient per year. At the same time, there is still lots more work to be done to address primary adherence and we know that not all people are non-adherent for the same reasons or will respond to the same techniques.

    But, I’m pretty confident that the the remaining $32 per patient could fund a lot of POS interventions like Ashville, education programs, caregiver programs, incentives, and other tactics. Of course, this would float all boats (I.e., brand and generic Rxs) so the cost per manufacturer might drop and the ROI should go up. At the same time, this should create overall saving by cutting into the estimated $290B in costs associated with non-adherence.

    Of course, most people are skeptical about this type of preventative health programs (aka primary preventation or public health) although 25 of the 30 years in additional life expectancy gained over the last century is credited to public health. Additionally, the Trust for America’s Health (TFAH) had estimated that an annual $10 per person investment in disease prevention programs could produce more than $16B in annual saving within five years.

    The easy argument would be that ultimately interests aren’t aligned for pharma as prevention might reduce Rx utilization. I would hypothesize that the increased number of new starts and decrease in abandonment would more than compensate.

    Of course, how do we pull this off? I’m not sure but it seems like a great HHS opportunity.

    Get Blog Posts By Email

    I was talking to several people yesterday that read the log regularly. Thank you all for that.

    One thing they didn’t realize is that you can have the posts emailed to you regularly. To sign up just go to http://www.georgevanantwerp.com and enter your email in the area on the right hand side of the website.

    Bad Pitch

    I was just reading an email pitch that I received from a healthcare social networking vendor talking about their system for engaging patients and physicians.

    Maybe, it’s just me but that seems to imply some understanding of how to engage people and use social media. First, they didn’t use my name in the email. It just said “Hi ,”. Then, at no point in the pitch did they say anything about why they reached out to me. And finally, they then asked me to tweet specific pre-formatted tweets that they had created. If I wanted that, I would follow them and do a RT.

    And to top it off, they don’t offer a way to follow-up to learn more. It was just shameless self-promotion. #Fail

    Pharmacy is “Sexy”? Maybe But Challenges Exist.

    Within the M&A landscape, “people keep returning to pharmacy. Pharmacy has always had long-term investment [interest] … and opportunities for growth and expansion are not difficult to imagine…. Pharmacy is sexy; it always has been, and, for the near future, it will continue to be.” — Dexter Braff, president of The Braff Group, a health care M&A company, told AIS’s Specialty Pharmacy News.

    This was an interesting quote for me. While I agree that the fundamentals of pharmacy are good, there are lots of challenges.

    From a positive perspective:

  • People are living longer
  • People are taking more medications
  • More and more traditional medications are available as generics which have higher margins as a percentage
  • There are more and more infant drugs and other high cost injectables
  • Adherence is becoming more and more important
  • Health reform will give millions prescription coverage (if not repealed)
  • BUT, from a negative perspective:

  • The economy is still tough which impacts overall utilization
  • The costs of healthcare and prescriptions in terms of out-of-pocket costs as a percentage of their earnings can’t continue to rise
  • You make less in real dollars per generic dispensed in many cases
  • Margins are under significant pressure in the traditional business (just look at Walgreens dispute with Express Scripts)
  • Margin compression is (and has been) moving into specialty
  • Consolidation in the PBM, pharmacy, pharma, and specialty world will continue
  • Pharma innovation and pipelines are not very robust with a few exceptions in some specialty categories
  • So…on the one hand, I agree. Pharmacy is very interesting and ripe for innovation. On the other land, there are lots of big, established players fighting for the same margin dollar. I’m still betting money on the industry, but I know lots of companies are trying to sell out so that tells me there are some challenges.

    Why Blending Rx and Dx Data Matters

    Yesterday at the PBMI conference, I was listening to a presentation on the blending of pharmacy and medical data. This has been the Holy Grail for a while although companies have struggled to do it well and successfully use it to affect change. That being said, I think it’s one of the biggest focus area for differentiation in the market today. From a large PBM perspective, you can look at the Guided Health efforts at Prime Therapeutics. From a payer software perspective, you can look at Active Health.

    Some of the examples from yesterday were interesting data points that you’d never see without digging into both sets of data. For example:

  • 84% of patients using PPIs chronically had no clinical diagnosis to support that
  • 67% of patients taking CNS stimulants had no clinical diagnosis to support that
  • 31% of patients taking atypical antipsychotics had no glucose monitoring
  • 60% of patients taking a psychotropic drug didn’t have a clinical diagnosis
  • Of course, the challenge is not only to identify them but to engage the patient and the provider in the best course of treatment looking at cost, outcomes, and patient experience.

    What is a TPA?

    TPAs are Third Party Administrators. You can see their definition in Wikipedia, but essentially they are companies that process claims, help manage risk, and often provide other functions in areas such as Flexible Spending Accounts for self-funded employers.

    The key to TA success has always been. That TPAs provide intimate, personalized services to client-employers and plans. This means lots of hand-holding and assistance in understanding and gearing up for new laws, requirements and concepts as they will best fit for that particular employer or workforce.

    . (Fred Hunt, past president, Society of Professional Benefit Administrators, Employee Benefit News, Feb 2012)

    In general, the complexity of the regulated healthcare industry is good for the TPAs that specialized in helping their clients navigate this maze and create a customized plan that meets their needs. Of course, in this like other industries, TPAs are focused on using technology and other differentiators to demonstrate value for their clients.

    Infographic: Student Health

    We all know that college is often not the healthiest time period for many people between all-nighters, dorm food,  caffeine, and alcohol.  I find the correlation between health and grades interesting and got the original source for it to support the infographic that I’m sharing below.
    Student’s Guide to Health and Fitness

    Infographic: Anatomy of a Doctor

    I found this graphic and thought I would share it.

    Do Hospital Ratings Matter?

    Younger people who make more money and have a college education are most likely to care about hospital ratings.  Not a big surprise.  But, less than half of those surveyed by the Thomson Reuters 2010 PULSE Healthcare Survey were “very likely” to even look for a hospital rating.  In my opinion, we’re still in a world where we make decisions about our healthcare facilities by looking out the windshield of our car.  [borrowing from someone's else's analogy]

    I’m not sure I understand why income isn’t a straight line correlation with this.  It’s those making >$100K and then those making less than $25K that are most likely to look for a hospital rating. 

    As you get into the impact of the ratings, I thought there were several interesting things.  For example:

    • Younger people were more likely to change hospitals because of a low rating, but least likely to be influenced by a top rating. 
    • For a serious illness, younger people were more likely to be influenced by the top rating while older people were more likely to choose the local hospital over the top rated hospital.
    • Education was clearly correlated with choice especially when faced with a serious illness.

    This generally correlates with the infographic I shared previously on millenials.

    30% of MDs Believe They Will Save Healthcare

    “It has become increasingly apparent that doctors have to work with other people and share the care of patients with other professions, whether they are nutritionists, pharmacists, or nurse practitioners.  You’ve got to be more collaborative, work as a team.  There’s a different mind-set.”  (Michael Dacey, SVP for Medical Affairs and CHMO, Kent Hospital)

    I think this quote a recent article in Health Leaders (In Search of the Team Player, Feb 2012) makes a great point.  Healthcare is changing.  While I think we are seeing the pendulum swing back towards being more physician centric, the new model will be very different with quality measures and new technologies and the empowered patient.

    The article shares some survey data that I found interesting.  For example, while only 10% of physicians blame themselves for the “healthcare industry mess”, 30% of them believe they are the ones that will save healthcare.  Certainly, physicians by themselves can’t change the model.  We need payment reform and many other constituents with different agendas involved.

    The article also shared a data point that 58% of physicians had ordered a test or procedure in the past year for purely defensive medicine reasons which is a sad reality.  At the same time, I know that many of us when faced with those tough decisions for ourselves want to jump through hoops to do everything possible even if it doesn’t offer a good ROI. 

    The issue of the impending physician shortage (see Washington Post blog) can be mitigated by engaging these other professions in a care team strategy, but will physician’s embrace this.  26% of physicians surveyed thought that increasing the scope of care for nurses would worsen the quality of care and 13% say that abuse or disrespect of nurses is common.  Fortunately, everyone wants the same thing which is cost-effective care that improves outcomes and the quality of life.  The challenge is finding a solution to do that.

    IBM on Social CRM – Relevant for Healthcare

    I was reading the IBM executive summary called “From social media to Social CRM“, and I thought I would share some of my takeaways. (Note that CRM = Customer Relationship Management)

    Social CRM “recognizes the role of business today is to facilitate collaborative experiences and dialogue that customers value.” Exciting! This seems like what many healthcare companies should be doing.

    Some of their findings include:

    • Nearly 80% of the online customers surveyed have at least one account on a social networking site
    • Almost 50% have accounts on media-sharing sites
    • Only 5% say they nearly always respond to others comments or post original content [creating a world of voyagers]
    • Only 45% use social media to interact with brands…but the majority of those say they need to feel a company is communicating honestly before they will interact

    There was a huge gap between why companies use social media and what customers want businesses to use social media for (as shown below):

    Additional data points:

    • Consumers who engage with a company via social media already have an affinity for the company or brand [key point…self-selection bias and identification of advocates]
    • 70% of companies think social media will increase customer advocacy while only 38% of consumers agree
    • Less than ½ of companies monitor their brand online
    • Only 53% of companies offer social media training to their employees
    • Only 27% of companies say they share social media insights across functional areas

    As I read on into the details of the study, they share the Best Buy case study which showed $5M in reduced call center calls based on their social media strategy. They also point out that social CRM is about engagement not management which is another key point relevant to a lot of the healthcare discussions today.

     

    Where are you on your social CRM strategy?

    My PCMA Presentation On Copay Cards

    I’m giving my PCMA presentation in FL right now about copay cards. For those of you that can’t attend, here is my executive summary and a copy of some slides. (My actual slide deck was shorter for presentation but this gives more data to those of you looking online.)

    I focused on three key points:

    1. Copay cards are a direct threat to the PBM model. They can run against the idea of copay differentials and formulary tiers. Since they’re not allowed at mail order, they create a disconnect there. And, eventually, I believe they will be in conflict with rebates (i.e., why pay for both).
    2. The cost numbers to the payer are huge ($32B according to Visante) although this is less than $1 per Rx over that 10 year time period. But, it’s concentrated on 3% of all scripts which makes it a big deal.
    3. There should be a win-win IF they are concentrated on specialty medications with a link to improved adherence and health outcomes.

    There doesn’t seem to be clear data (although another article says it is available) but the general data shows that availability and use of copay cards is growing rapidly.

    Investing in copay cards seems to be based on four myths:

    1. Cost is a large issue in non-adherence. It’s an issue but not the dominant issue.
    2. Costs will influence physician choice. The reality is that they don’t know the costs and see this as a pharmacist issue.
    3. Copay cards are a cost effective way to improve adherence. They get about a 10% improvement in MPR which sometimes produces a positive ROI. There are much lower cost ways to get a similar improvement.
    4. Copay cards can delay conversion to generics. This is still in the air with the Pfizer Lipitor program, but if it works, it will be a lightning rod for PBMs and payers to focus on.

    This topic’s not going away. For now, the easy PBM response is to close down the formulary, move more scripts to mail, and implement prior authorization programs. I would expect this will happen more often unless there is more transparency here around what’s happening and the benefits. Things like ZQuiet can, indeed, help one to stop snoring when used correctly.

    Reading Labels; Understanding Side Effects

    We all know people don’t read labels on their medications or their over-the-counter (OTC) pills. If they did, their eyes would gloss over, and they would start to worry about all the side effects. Of course, this is a problem since some things can create drug-drug interactions or create an overdose.

    I was reading an article in USA Today called “Read the labels because ‘all drugs have side effects’“. It lists out Tylenol, Advil, Motrin, Benadryl, Claritin, and Zantac as examples of OTC medications with overdose risks. It gives more details on these and provides several other examples. Here’s a quote from the article:

    “It’s important for the public to realize that all drugs have side effects. It doesn’t matter if they’re prescription, over-the-counter, herbals or nutritional supplements. If they have active ingredients, they have side effects and can interfere with normal body functions.” Brian Strom, director of the Center for Clinical Epidemiology and Biostatistics and the University of Pennsylvania

    The reality is that we’re making an unconscious choice about tradeoffs. Do the risks and probabilities of the side effects outweigh the probabilities of improvement?  Of course, in many situations, they do. 

    I think this points to several things:

    • Document everything you take whether it’s an Rx, OTC, herbal, or supplement.
    • Read labels.
    • Tell your MD and Pharmacist what your taking especially if it’s regular and long-term.

    Ideally, once we have broad use of PHRs (personal health records) which are tied into our grocery bills to track purchases and use then computer algorithms can look for risk factors. And, with personalized medicine, we might one day know which things to avoid based on our genes.

    The Well Being Index

    I find this to be an interesting study (the Gallup-Healthways Well-Being Index). Gallup and Healthways are surveying 1,000 people per day for 350 days per year and has been doing it for several years.

    I was reading one of their brochures looking at data from 1/2/10 – 12/30/10. Here’s a few observations:

    • The index score across all states varies by a narrow range of 9.3 points.
    • The top 5 states (in 2010) were:
      • Hawaii
      • Wyoming
      • North Dakota
      • Alaska
      • Colorado
    • The top 5 large cities were:
      • Washington-Arlington-Alexandria, DC-VA-MD-WV
      • Austin-Round Rock, TX
      • San Jose-Sunnyvale-Santa Clara, CA
      • Seattle-Tacoma-Bellevue, WA
      • San Francisco-Oakland-Freemont, CA

    The overall composite score is based on six sub-indices:

    • Life Evaluation
      • Partially based on the Cantril Self-Anchoring Striving Scale
    • Emotional Health
      • A composite of how the consumer felt yesterday along nine dimensions
    • Physical Health
      • Body Mass Index
      • Disease burden
      • Sick days
      • Physical pain
      • Daily energy
      • History of disease
      • Daily health experiences
    • Healthy Behavior
      • Life style habits
    • Work Environment
      • Feelings and perceptions about work
    • Basic Access
      • 13 items measuring:
        • Access to food
        • Access to shelter
        • Access to healthcare
        • Having a safe and satisfying place to live

    This gives an interesting macro view of healthcare at a localized level. The thing I’d like to learn is how this is shaping communities and health care entities to act different. Is this changing engagement strategies? Is this changing regional investments? Can the data be tied back to individuals and used to help improve outcomes?

    Comments On Prescription Copay Article

    In preparation for my presentation on copay cards at the PCMA event on Wednesday, I read Mason Tenaglia’s article in Pharmaceutical Executive called “Letting the Facts Get in the Way“. I think it’s a good article from the manufacturer perspective to discuss copay cards. (You can see comments from Adam Fein here.) Perhaps if Mason and Visante could get together and share data we might actually have a full perspective of the marketplace.

    Mason’s article is a frontal attack on the Visante paper on the topic that talks about copay cards increasing costs by $32B over the next 10 years (which by the way is less than $1 per Rx over that time period). But, I’m not sure it really clears up the debate for me. Let me discuss a few points.

    • He talks about the APLD (Anonymous Patient Longitudinal Data) from Wolters Kluwer which can identify secondary payers. And, it can tell you if they were new to therapy, changed therapy, or simply were continuing therapy when they used the cards. This sounds great since everyone I’ve ever talked to said they can’t get to this data.
    • He proposes that the Lipitor $4 program to extend the brand after a chemically equivalent generic is available is more an anomaly than a standard program. Perhaps. While I agree that the focus of many cards is in specialty (51% according to his estimate), if the Lipitor program works (still TBD), why wouldn’t others jump on board (which would likely increase costs to payers).
    • He proposes that copay cards be used for Medicare Part D members (which most people tells me already happens). He also says that they’re the least adherent which is probably true based on total number of prescriptions which has been shown to correlate with lower adherence (not really their insurance).
    • He states that most copay cards are used for Tier 2 (formulary) medications. It makes me wonder why the manufacturers pay rebates and use copay cards…which he alludes to in his article.
    • He states that formulary access is attributed to marketshare which I think is true in a world of “me-too” products, but if products have new clinical value and better outcomes, they can get placed on a formulary without marketshare.
    • He states that copay cards won’t drive up costs in Part D because over ½ of the utilization of brand drugs is by low-income patients where they won’t need a copay card for their $6.60 average copay. I personally disagree. I think that’s a red herring as this group is very price sensitive.
    • Without giving away too much of my presentation for Wednesday (which I’ll post the slides and summary that day), he makes a key point but without the key data. “Combined medical and pharmacy costs in Medicare for oncology, rheumatology, and MS might actually be lower as a result of compliant patients.” The key word here is might. While I (like many) believe this to be true, I don’t think there are studies to support this. I agree that IF copay cards could demonstrate improved adherence AND that adherence could demonstrate lower medical costs and better outcomes THEN we would be having a different discussion.

    It’s an interesting area. I’ll share a lot more thoughts on Wednesday, but I think Mason’s article is a good one for discussion on the topic.

    90 Day Rxs Get Better Adherence

    I think we can all agree now that 90-day prescriptions are correlated with better adherence (and the percentage of retail 90-day scripts is going up).  The latest study here is from Walgreens.

    A new Walgreens study analyzing relative medication adherence of patients filling 90-day supplies of maintenance medications using retail and mail order channels over a one-year period concluded that patients who fill prescriptions via retail have as high or slightly higher adherence levels than those utilizing mail (77 percent vs. 76 percent). The study, “Medication Adherence for 90-Day Quantities of Medication Dispensed Through Retail and Mail Order Pharmacies,” was recently released in the November issue of The American Journal of Managed Care.

    This reflects other studies from CVS Caremark, Express Scripts, Kaiser, and BCBSNC.  (Although sometimes it shows mail order as better and sometimes retail.)

    Of course, the data is slightly different in either case, but the general consensus is the same.  So, the question is what’s next.  How should you compare the two channels?

    • Generic fill rate
    • Overall health literacy and health outcomes
    • Patient experience / satisfaction
    • Payer cost
    • Cost to fill

    This issue won’t go away so it’s going to be important to continue to find ways to compare the channels and find populations that are similar for comparison or remove the bias.

     

    Rock Health Report on Digital Health

    I saw this out on Slideshare, and I thought I would share it here.

    NYT Article On ACOs Replacing Health Insurers

    I think it’s a bold (maybe foolish) prediction that is made in the NY Times article saying that ACOs (Accountable Care Organizations) will be the end of health insurers.  We don’t even know that ACOs will work yet.  You can even see some debate on this topic in this blog post on Why ACOs Won’t Work.

    But, I’m not an ACO expert so let me focus on what I found interesting in the NYT article.  It points out a few things:

    1. The focus on preventative care
    2. The fact that some managed care organizations are changing (and others will too)
    3. The fact that “ACOs” (in whatever form they take) will need a platform

    This is what I find interesting.

    I think the concept of an ACO (or Patient Centered Medical Home) where care becomes localized and there is greater focus on prevention and wellness not just sick-care is great.  We should all want that to happen in some form.

    But, in all cases, this changes the data needs and role of the physician.  They need to be empowered with new information and tools.  How do they manage their panel of diabetics?  Will some database track them and monitor their screenings and blood sugar?

    When the field of medicine is constantly changing with new drugs and new studies, how will physicians have the best practices pulled into their practice?  They won’t want to wait the 16 years it takes for things to work their way through the system.  They’ll actually want to embrace the best solutions and see more comparative effectiveness information.

    I see a huge opportunity here for someone to create an ACO “platform” that embeds business rules, tele-monitoring, consumer engagement, and reporting into a way to create the “i-physician” (informed physician) of the future.

    Medicare Enrollment Up 1.2M (9.5%) in 2012

    Based on new data from CMS as shared by CSFB in a report, the enrollment in Medicare Advantage through January 12th is up 1.2M to 13.3M.  This is 27% penetration into the Medicare market.  PDP enrollment was up to 19.69M a similar gain of 1.2M. 

    A quick summary of the big winners are:

    • For Medicare Advantage (by percentage)
      • Humana +13.5%
      • Amerigroup +13.3%
      • Coventry +12.2%
    • For Medicare Advantage (by membership)
      • Humana +262K
      • United +132K
      • Aetna +35K
    • For PDP (by percentage)
      • Coventry +25.3%
      • Cigna +14.8%
      • Humana +12.3%
    • For PDP (by membership)
      • Humana +312K
      • Coventry +291K
      • Cigna +80K

    This is also interesting in light of Kermit Crawford (CEO of Walgreens) comment yesterday:

    “Based on our preliminary analysis of the Centers for Medicare and Medicaid Services (CMS) data, Medicare Part D plans with Walgreens in their network gained market share in the aggregate, while those without Walgreens lost market share. Importantly, we were very pleased to see that those plans that included Walgreens grew nearly twice as fast as those Medicare Part D plans without Walgreens. In fact, several health plans that partnered with Walgreens grew significantly faster. For example, Coventry, who partnered with Walgreens and introduced a low cost Medicare Part D option, grew five times faster than the overall market.”

    The one obvious account that he’s talking about is Wellpoint which lost 2,000 (0.3%) members in MA and 73,000 (11.6%) members in PDP.


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