Archive | Politics RSS feed for this section

Could CVS Caremark Become A Kaiser?

I know the popular opinion is to talk about CVS Caremark splitting up.  Let me go radically in the other extreme. 

I think everyone has an appreciation for what Kaiser has created – insurer, provider, pharmacy, …  They’ve created an integrated system with impressive outcomes, passionate consumers, and a connected technology backbone.  There are a few other organizations that have had regional success doing the same – HealthPartners, Geisinger, … 

The question I would have is who is in the best position to build themselves into an integrated system.  The two companies that jump out at you are United Healthcare and CVS Caremark.  Of course, neither of them have the provider (aka hospital) assets. 

But, I think the point here is that most people I talk to agree that an integrated model is the right model “on paper”.  It can (in theory) offer the best patient experience.  It can drive the best integrated data.  It can coordinate across business lines to accomplish the best outcomes. 

So, it makes me wonder why we let Wall Street dictate the strategy here.  In many cases, structural changes take time.  If building an integrated model is the right concept, why isn’t the talk about CVS Caremark buying a health plan and subsequently jumping into the provider space with ACO models?  Why isn’t the discussion about United Healthcare buying up hospitals and physician groups?

Maybe I’m just trying to present a different scenario or maybe I have rose-colored glasses on, but I think it’s an interesting question to ponder.

(Note: As I’ve disclosed before, I both own CVS Caremark stock and have a business relationship with them.)

The Physician As Island Versus Support From Intermediaries

Should physicians have the final say in patient care?

Someone tweeted me this question the other day. It made me start to think…

Logically, individuals trust their physician to act in their best interest and make the best decisions (based on the information they have).  But, this has shifted from the MD as the primary source of knowledge to the MD as a part of a care team.

There are probably more, but I can think of 5 important things that need to be fixed for the physician to be seen as an ‘information island’ where they can make the best decisions without intermediaries (PBMs, managed care, disease management companies) intervening:

1.  They have to be able to not practice defensive medicine.

2.  They have to understand my costs.

3.  There have to be no meaningful differences based on geography or income or race.

4.  They have to adopt best practices quickly.

5.  They have to be able to be paid based on outcomes.

Some of these are systemic changes that have to be addressed (#1 and #5). The other three can be addressed thru technology (as long as physicians are willing to embrace the science of medicine not just the art).  As a quick example, look at Dr. Atul Gawande’s book. – The Checklist Manifesto or look at some of the work by companies like Health Dialogue on shared decision making.

Now, maybe the person that asked the question is taking a more radical stand and physician’s embrace the support these companies provide them, but that hasn’t historically been true.

Data: Should You Be Paranoid?

I think we all know or are quickly realizing that everything we do leaves a trail of breadcrumbs.  That trail is a series of data points which now can be aggregated to create a record of you.  What you do?  What you buy?  What ads you respond to?  Who your friends are?  The list goes on. 

The question of course is whether you should be paranoid and worried about it. This video below shows you the extreme scenario of how data could be abused.

In a more balanced view, Time Magazine had an article call Your Data, Yourself which just appeared on March 21, 2011.

Oddly, the more I learned about data mining, the less concerned I was. (Joel Stein, author of article)

The article talks about a variety of companies that collect and sell data:

  • Google Ad Preferences
  • Yahoo!
  • Alliance Data
  • EXelate
  • BlueKai
  • RapLeaf
  • Intellidyn

The author makes a key point…a lot of the things we get for free are free because people collect and sell our data.  Otherwise, these “free” business models wouldn’t exist.  Would you pay for all the content and other things you get today or do you just want to understand what happens to your data?

On the other hand, the author shows you how data put together adhoc can paint erroneous pictures of you.  Should you care?  Do you want to fix this?  Can you control it?

This is all important since there is some do-not-track legislation being discussed.  (See Joe Manna’s post on this for some additional perspective)  Several people bring up the good question…

While we say that we don’t like to know that our data is being used to target ads at us, do we really want to have to sort through all the irrelevant advertisements?

Of course, we all become a lot more sensitive around healthcare data.  But, somehow, I doubt many of us think about what happens when we use our work PC to research a condition (see article on 10 ways to monitor your employees).

The article also suggests some sites for protecting yourself:

Don’t expect this one to go away.  With issues like the data breach at Epsilon, people are concerned.  Additionally, as data gets co-mingled and your credit score is used to determine health programs (for example), there may be limits about what and how information is used.

Should The State Board Of Pharmacy Govern PBMs?

Mississippi has introduced legislation that would move the oversight of PBMs from the State Insurance Commissioner to the State Board of Pharmacy.  From a clinical care perspective, there seems to be some logic here, but from a business perspective, it doesn’t work.  Right now, the State Boards are generally made up of local pharmacists with an occassional PBM pharmacist on the board. 

Since that group negotiates with the PBMs for rates, it would seem to create a major conflict of interest.  PCMA has honed in on this and is actively fighting it. 

I guess that’s like saying that hospitals should govern managed care organizations.

Congressional Statements Regarding MTM

In the new Medication Therapy Management Empowerment Act of 2011, there is a nice summary at the beginning of why this is important:

    Congress finds the following:
  1. Medications are important to the management of chronic diseases that require long-term or lifelong therapy. Pharmacists are uniquely qualified as medication experts to work with patients to manage their medications and chronic conditions and play a key role in helping patients take their medications as prescribed.
  2. Nonadherence with medications is a significant problem. According to a report by the World Health Organization, in developed countries, only 50 percent of patients with chronic diseases adhere to medication therapies. For example, in the United States only 51 percent of patients taking blood pressure medications and only 40 to 70 percent of patients taking antidepressant medications adhere to prescribed therapies.
  3. Failure to take medications as prescribed costs over $290,000,000,000 annually. The problem of nonadherence is particularly important for patients with chronic diseases that require use of medications. Poor adherence leads to unnecessary disease progression, reduced functional status, lower quality of life, and premature death.
  4. When patients adhere to or comply with prescribed medication therapy it is possible to reduce higher-cost medical attention, such as emergency department visits and catastrophic care, and avoid the preventable human costs that impact patients and the individuals who care for them.
  5. Studies have clearly demonstrated that community-based medication therapy management services provided by pharmacists improve health care outcomes and reduce spending.
  6. The Asheville Project, a diabetes program designed for city employees in Asheville, North Carolina, that is delivered by community pharmacists, resulted over a 5-year period in a decrease in total direct medical costs ranging from $1,622 to $3,356 per patient per year, a 50 percent decrease in the use of sick days, and an increase in productivity accounting for an estimated savings of $18,000 annually.
  7. Another project involving care provided by pharmacists to patients with high cholesterol increased compliance with medication to 90 percent from a national average of 40 percent.
  8. In North Carolina, the ChecKmeds NC program, which offers eligible seniors one-on-one medication therapy management consultations with pharmacists, has saved an estimated $34,000,000 in healthcare costs and avoided numerous health problems since implementation in 2007 for the more than 31,000 seniors receiving such consultations.
  9. Results similar to those found under such projects and programs have been achieved in several other demonstrations using community pharmacists.

Words Matter: Have You Drugged Your Kid Today

I think I’m going to start a series tagged to “words matter” where I call out some of the examples that I notice. The first one is the story about a teacher getting fired for her bumper sticker on her car. (Something I never thought would happen.) Her bumper sticker said “Have You Drugged Your Kid Today”.

First off, I think people are entitled to their opinions.

Second, I think we all would agree that there are certainly times when patients are given medications rather than ask to change.

Whether kids are over-medicated today versus the past is hard to know. We are certainly more aware of conditions these days, but I think this is a hot topic. Just look at some of the articles on the topic.

It’s not like the teacher was taking some massively controversial position. She wasn’t teaching the kids. She was simply expressing an opinion on a hotly debated topic in a quick sound bite which she put on her car in the form of a bumper sticker.

NCPA Twisting Reality Again

I continue to be frustrated by NCPA (National Community Pharmacists Association). While I agree that the pharmacist – patient relationship is important, they continue to blatantly misrepresent the facts to make their point. On Tuesday, they sent a letter to Kathleen Sebelius, Secretary of HHS, stating the following:

While we strongly support your efforts to provide the states with measures to drive pharmaceutical program costs down, we respectfully disagree with the statement that mail order is a potential cost-savings program strategy. Experience has shown that mail order pharmacies almost never deliver the savings they promise and are often ultimately more expensive than community pharmacies. In 2009, retail pharmacies drove a 69% generic dispensing rate (GDR) while the three dispensing services of the largest PBMs – Medco Health Solutions, Inc.; Express Scripts, Inc.; and CVS Caremark – had GDRs under 58% for the exact same time period – leaving potential savings on the table resulting from increased brand usage.

Either they are naïve or they think HHS is. You can’t compare the GDR at retail pharmacies to the GDR at mail order pharmacies without significant adjustment for acute medications and seasonal medications that aren’t appropriate for mail order. Historically, those medications have had higher generic utilization than other conditions (e.g., antibiotics).

On the other hand, maybe they aren’t a history fan. The only independent study that I’ve seen comparing the two channels specifically on this issue was published in 2004 by Harvard in Health Affairs. It looked at claims from 5 PBMs across both channels, made the adjustments, and concluded that while retail had a slightly better GDR than mail, it had a lower generic substitution rate. It also pointed out that the majority of the different was attributed to the statin class which was over-represented in the mail order channel (and at the time was mostly brand prescriptions).

Or, maybe they haven’t looked at the chain GDR versus the independent GDR…In this presentation, you see what I would expect – chain GDR > independent GDR. Combine that with the percentage of scripts dispensed (i.e., weighted average) and the normalized GDR from the Health Affairs study probably would favor PBMs over independents.

Since PBMs make over 50% of their profits on generic at mail, it wouldn’t make sense for them to sub-optimize this area. Given the changes in drug mix over the past 7 years (i.e., more generics), I would hypothesize that if this study were done again you would see mail order matching or exceeding retail GDR especially GDR for independents.

FL Pharmacists to Fight Medicaid Mail Order

The Florida Pharmacy Association along with a local pharmacy in Florida have filed suit against the state for allowing Medicaid patients to use mail order.  This seems silly to me.  The mail order pharmacy ship has sailed a long time ago.  Approximately 13% of all prescriptions filled in the US are through mail order. 

While I would still disagree if it was mandatory mail, this isn’t.  The state is simply giving patients the option to get their drugs through mail order.  If the community pharmacies have an issue, they should match the mail order rates and dispense 90-day prescriptions and delivery them to the patient’s house at no cost. 

We’re in a budget crisis here as a country.  If we can save money in Medicaid and therefore in the state budgets, why wouldn’t we do it?

The lawsuit says that the change –  

 “at a minimum deprives the patients’ access to a provider having extensive knowledge of their medical conditions and unique clinical problems.”

Really?  I’d love to know how many of those Medicaid patients have a long standing relationship with their pharmacist, know them by name, and don’t use multiple pharmacies.  Maybe I’m wrong. 

It comes down to losing business BUT if the patients are so happy, won’t they stay with their local pharmacy.  This is a transient population so it’s always been hard for mail order.  It’s not easy to send them refill reminders.  There’s not always a consistent address to mail to.  Some of that is changing as text messaging becomes more normal as a communication medium, but that’s still a small percentage of companies. 


Save $30B in Medicaid (over next decade)

The big assumption around savings is always that you’ll have to cut benefits. What if that wasn’t true? Why wouldn’t the government be making those changes?

A new report by The Lewin Group explores this. 73% of Medicaid spending is based on fee-for-service plans that are administered by state officials. Not a big surprise to those of us that believe in the private market over big government, but they leave a lot of money on the table compared to Medicare and managed Medicaid.

The savings come from four areas:

  1. Generic Drug Dispensing: Medicaid FFS is less effective at encouraging the dispensing of generic drugs in place of brands. The generic dispensing rate in Medicaid FFS averages 68%, compared to an average 80% generic dispensing rate in Medicaid MCOs. While some of this difference is attributable to demographic differences between the Medicaid FFS and MCO populations, much of the generic dispensing difference persists when looking within each demographic subgroup.
  2. Dispensing Fees: At $4.81 per prescription, the national average dispensing fee that Medicaid FFS programs pay to retail pharmacies is more than double the average dispensing fees paid by Medicare Part D payers, Medicaid managed care organizations (MCOs), or health plans in the commercial sector.
  3. Ingredient Costs: The rate at which retail pharmacies are reimbursed for the actual medication ingredients (pills, capsules, etc) is also higher, on average, in Medicaid FFS programs than in Medicare Part D or the commercial sector.
  4. Drug Utilization: The number of prescriptions dispensed per person is typically higher for similar demographic subgroups in Medicaid FFS programs than in Medicaid MCOs for similar demographic subgroups due to less effective controls on polypharmacy, fraud, waste, abuse, and other factors in the FFS setting.

Their study estimates that converting all the FFS Medicaid to a Managed Medicaid model that relies on the typical PBM process would save almost 15% (or about $30B over the next decade).

The report also includes lots of comparative data (state by state) which shows the discrepancies across the US in terms of cost of FFS Medicaid.

State Spending Per Medicaid Enrollee

I don’t post a lot of the information that I get from various press releases, but this one seems interesting.  It ranks the top 10 and bottom 10 states based on Medicaid spending…which is obviously very relevant as we move to more people being covered by Medicaid and also has relevance on physician participation with Medicaid.

This is from and is based on the Kaiser data from

The 10 states with the highest Medicaid enrollee funding are as follows:


Medicaid Enrollees* Medicaid Payment Per Enrollee*

Total Federal

Medicaid Payment**

1. Rhode Island 195,400 $8,796 $  1,834,227,212
2. New York 4,954,600 $8,450 $47,618,463,035
3. District of Columbia 164,900 $7,932 $  1,445,734,028
4. Alaska 120,800 $7,815 $     890,169,313
5. New Jersey 954,000 $7,814 $  9,425,126,545
6. Minnesota 785,600 $7,700 $  6,977,657,315
7. Massachusetts 1,402,500 $7,490 $10,821,588,261
8. Connecticut 530,300 $7,357 $  4,543,549,844
9. North Dakota 69,400 $7,288 $     534,431,274
10. Pennsylvania 2,090,200 $7,159 $16,299,966,377

The 10 states with the least Medicaid enrollee funding are as follows:

State Medicaid


Medicaid Payment Per Enrollee *

Total Federal

Medicaid Payment**

1. California 10,511,100 $2,701 $38,747,885,430
2. Arizona 1,455,800 $3,066 $  7,506,329,319
3. Georgia 1,685,000 $3,560 $  7,337,801,478
4. Oklahoma 719,200 $3,571 $  3,538,913,312
5. Texas 4,170,100 $3,598 $21,461,296,293
6. Arkansas 692,300 $3,617 $  3,287,326,144
7. Louisiana 1,096,500 $3,823 $  6,067,665,948
8. Hawaii 216,600 $4,051 $  1,206,716,133
9. South Carolina 891,600 $4,260 $  4,436,586,247
10. Michigan 1,855,500 $4,348 $  9,846,978,779

*Kaiser State Health Facts Medicaid Payment Per Enrollee 2007

**Kaiser State Health Facts Total Federal Medicaid Payment 2008

Todd Park (HHS CTO) On Unlocking Innovation Mojo (#mhs10)

I came out to the Mobile Health Summit (Twitter hashtag #mhs10) in DC today, and I had the opportunity to interview Todd Park who is the Chief Technology Officer (CTO) for the US Department of Health & Human Services (HHS). Todd is a great resource for the country and perhaps a surprising bureaucrat (in the nicest sense of the word) given his background as a consultant and then co-founder of athenahealth.

It was an interesting discussion starting around what his role is. The CTO role is a new role in the US government which he describes as an internal change agent who is responsible for working with HHS leadership. He described his objective as forming virtual start-ups to advance new solutions. [A radical departure for those of us that view government as a monolithic organization which is slow to change and full of red tape.]

He said that one of the first questions people ask when they see the new initiatives such as is who were the consultants he brought in from Silicon Valley to do the work. He says that it was all internal people. We talked about that being a cultural change which he described as “creating the right vision” and a “work pathway”. That sounds exactly like what one might see a change agent being responsible for – better leveraging internal assets by changing the framework for service delivery.

We talked about several of the initiatives that HHS has worked on lately:

  1. which is a focused on helping consumers find public and private options for healthcare. He said this was a 90-day implementation. I think if you go to the site you’ll see a few things:
    1. Easy navigation
    2. Content for multiple personas
    3. Links to social media
    4. Videos, widgets, blog postings, iPhone app, etc.

    This is much like what you would expect from a direct-to-consumer company or your health plan.

  2. The Open Health Data Initiative which is focused on taking data which HHS has and making it available for use by companies for FREE. The idea is to stimulate an eco-system around the data and enable better health thru better decisions. He uses the NOAA framework as an example for how they share data to sites like He then mentioned that they had done a brainstorming session earlier this year to think about what could be done with this data (some of which was new to everyone). You can learn more and see the 2-hour YouTube video here, but a talk by Todd Park at another event is below.


  3. The Blue Button Initiative which was launched in October and focuses on getting Medicare members and veterans to get a copy of their own data to print, download, share, upload, etc. Already more than 100,000 have downloaded their data. This should certainly be an enabler for PHR adoption.

We then went on to talk about HHS as a “reservoir of innovation mojo” which needs to collaborate with the public sector. In Todd’s words, he sees government as needing to be a catalyst and enabler. When he joined, his idea was not to fly in like aliens and change HHS, but to come in and find ways to unlock the mojo which already existed.

I asked him if he sees this as being a model for the private sector. Obviously, one of the challenges we have everywhere is figuring out the right way to balance co-opetition and competition. If we’re going to “solve” our obesity epidemic, we need to have some collective knowledge and insights rather than constantly re-creating learnings in a microcosm. On the flipside, companies want to create intellectual property and sustainable differentiation. It’s not easy to balance.

But, Todd mentions that several companies are already following in the “blue button” model such as Gallup / Healthways which is making their Well Being Survey data available publicly (for FREE) for the top 200 cities.

Of course, there is a lot of work to do here. I asked him about what the government was doing to address some things at a national level (e.g., obesity) where in my mind we almost need a reframing such as that which happened with littering, smoking, or wearing our seat belts. He brought up three things that were happening:

  1. National Quality Initiatives
  2. HealthyPeople 2020
  3. Community Level Dialogues

One of the other things that we talked about was the challenge of making changes to health outcomes with the health literacy levels in the US. I suggested that we need to address this systemically as I believe we need to address financial literacy…beginning in the schools and the home. He talked about needing to making learning fun through educational games. He mentioned that the First Lady had been promoting the creation of apps to accomplish this as part of a competition. (This made me think of the iTots article in today’s USA Today.)

We closed with a quick discussion on other things that he’s monitoring that will drive healthcare innovation. He talked a lot about improvements in the provider payment system – think Accountable Care Organizations (ACOs) and Patient Centered Medical Homes (PCMH). The goal with these is the change from “pay for volume to pay for value”.

Talking to Todd gives you a positive view on what government can do. I can see him motivating his team and his prior teams to follow his vision and embrace change.  I’d have to agree with Matthew Holt’s article on Todd Park from earlier this year.

The Future Of Pharmacists

I went into yesterday’s NCPDP presentation expecting that I would be an outlier in proposing a radical model for pharmacists … but others had the same ideas before I spoke. I think everyone has talked about pharmacists wanting to do more counseling with their patients for years. Some of this is fulfilled with Medication Therapy Management (MTM) which began to be a compensated service under Medicare.

But, there is a huge gap in terms of what pharmacists are trained to do and what they actually do. I remember initially running into this concept when I worked on my pharmacy kiosk model. Some people saw this as a horrible thing that would replace the pharmacist. I actually saw it as a way to free up their time to focus on the patients that needed counseling not on people filling an antibiotic or getting a refill for the 30th time. In that case, I ended up going to talk to the Head of the St. Louis College of Pharmacy to see his thoughts. I remember him talking about the gap between what the students learn and the reality of what they do.

Most pharmacists (unfortunately) become high paid pill counters for much of their day. As someone said yesterday, “I didn’t go to school to learn to count in 5’s.” Another person pointed out yesterday that the top questions at the pharmacy are “How much will this cost”, “How long do I need to take this”, and “where’s the bathroom”. These aren’t things that require clinical knowledge.

There was a healthy discussion yesterday about expecting more from pharmacy technicians. For refills (which are 55% of prescriptions filled), why can’t they handle the process with oversight from the pharmacist.

Which I think brings us around full circle…

We’ve gone from a shortage of pharmacists to an overabundance of pharmacists. This has changed the paradigm. How do we leverage them?

At the same time, we have a shortage of PCPs which is likely to get worse with more insured people. Why can’t pharmacists step in here?

The change in flu shots may be the beginning. Will this be the start of all immunizations for people over 7 (as one person suggested yesterday) moving to the pharmacy? Given the profit on these, that would be a boom for the pharmacies, but it would certainly get pushback from the physician groups.

I would also suggest that the pharmacist could act as a PCP in helping manage care. Think about conditions like diabetes where the pharmacist in certain settings would have a unique ability to help the patient select food or look at devices. They could become a much more active “floor” resource for people shopping.

And, my radical idea that another presenter suggested yesterday was to look at focusing the pharmacist on new fills and initial titration. This of course would blow up the financial model in pharmacy. Why not pay them $10 or $15 per new fill and for the next 2 fills (of maintenance drugs) and then move everything to mail order, kiosks, central fill, and/or pharmacy technicians. We could write rules into the system to flag the technician to ask questions of people on statins every 12 months about getting lab work done or muscle pain.

At the end of the day, I would argue that pharmacy needs a radical overhaul like the entire healthcare system, BUT since it only represents 10-15% of total healthcare spend, some would argue that improving it be 25% (which would be huge) would only impact 2-4% of our healthcare spend. The problem with this is it’s like the PBM trying to justify adherence without looking at the impact on total health, absenteeism, and other factors.

Today, prescriptions are first line therapy for 90% of diagnosis. Over 50% of patients take 1 or more maintenance drug. And, most patients drop off their maintenance prescriptions by the end of year one. This costs us $300B a year.

Finding a new role for pharmacists and pharmacies, and giving them a better seat at the table is an imperative for change not an option. At the same time, there is a role for integrating technology into what they do to automate the simplier, repetive tasks. I’m not sure who’s the champion here, but I was emboldened by the fact that I wasn’t a radical at the conference.

Obama and PRI (Parody) on

I found these two videos explaining the new websites.  One is the official Obama video and the other is a parody of that video from the Pacific Research Institute. [PRI is a free-market think tank.]

No “Pay-to-Delay” For Pharma

The Senate Appropriations Committee approved adding language to restrict this practice to a spending bill.  Will it ultimately pass?  I’m not sure.

What is it?  The way a generic drug comes to market is that generic manufacturers (e.g., Teva) will wait for a patent to expire and/or challenge the patent.  They do this by filing an ANDA (Abbreviated New Drug Application).  Manufacturers obviously want to enjoy the exclusivity of their patent(s) as long as possible.

My understanding is that “pay-to-delay” is when:

  • The brand manufacturer knows that someone is going to challenge their patent and try to get a generic to market before the patent expires.  They pay the generic manufacturer not to do this and in return might allow them to offer an “authorized generic” before the patent expires.

On the one hand, my reaction to this potential legislationis a “finally”.  On the other hand, this is a defeat for creative capitalism.  Does a company have to launch a product?

If Ford wanted to pay Toyota to delay the launch of a new car such that they both made more money, would the government step in and tell them they had to launch it.  Perhaps that’s apples to oranges.

The problem here is that while the brand manufacturer made more money and the generic manufacturer made money for doing nothing (other than getting the right to launch it) the public (i.e., consumers) and payers lost since they had to wait to save money.

New Health Insurance Ideas

Just two ideas that I was playing with for health insurance.

1. Complete transformation from group to individual

Why not change the entire market to be an individual purchase…There are obviously some reasons such as adverse selection and group buying power, but I would think those were things where the government could add value.  If individuals selected the health insurance companies and products that they liked, it would create a very different dynamic. 

You could then change the employment paradigm not to a provider of health insurance, but make it more a part of your compensation.  Company A might fund up to $5,000 per year in health insurance while Company B provides up to $7,200 for family coverage.

One of the big benefits of this (beyond making individuals into consumers with power) is that health insurance companies could start to invest in outcomes.  Today, they are hesitant to make long-term investments (i.e., if I do this for 5 years, it will reduce the cost of this individual in 20 years) because their membership turns over.  This is a real issue in my mind.

2. Free insurance for healthy people

There is obviously an issue with funding and hyperbolic discounting, but what if we simply said that people who maintain some set of health standards (BMI btwn 20-25; HDL less than 180; able to run a mile in under 8 minutes) got free health insurance.  Would that make a difference?  I think so.  Companies would be better off – less absenteeism.  The US healthcare costs would drop.

Of course, it would take it’s toll on the providers while being a boom for gyms.  But, it’s hard to find that win-win-win. 

I know there’s a big issue of funding, but I was thinking about some radical ideas of what the money being raised by Gates and Buffet could be used to do and how it could motivate people.

Wal-Mart Whitepaper on Restricted Pharmacy Networks

Of all the companies that might put out a restricted network whitepaper (PBMs, retail chains, consultants), I will admit that Wal-Mart is a surprise to me. It’s not that they haven’t been trying different strategies to increase market share – $4 generics, direct-to-employer contracting, but in general, I don’t see them doing a lot of marketing or selling in this space. They participate at one industry event, but their booth is very stark compared to other pharmacies.

But, that being said, the whitepaper makes the key points that anyone would make (i.e., I agree with the framing of the opportunity) with a slight twist of focusing on member savings versus payer savings.

Some of their key points from the whitepaper are:

  • You should treat pharmacy negotiations like buying any widget. There is more supply than demand.
  • Today’s model encourages all pharmacies to offer a rate that doesn’t get them kicked out of the network.
  • Today’s model doesn’t encourage consumers to pick one pharmacy over another.
  • There’s 5x more pharmacies than McDonald’s in the US…and no one would argue that it’s difficult to get a Big Mac.
  • They quote the Medicare pharmacy access standards to make the point about what access you can survive with. They reference an Express Scripts analysis that says the Medicare access standard can be achieved with a national network of less than 20,000 retail pharmacies (compared to the 60,000 in most networks).

While limited retail networks are not a new concept, they haven’t been widely adopted historically (<10% of clients). PBMs have always offered this type of plan design to payers – “If you remove a few chains from your network, you’ll get a lower rate from the other chains in return for increased marketshare.”

With the integration of CVS Caremark and their offer of Maintenance Choice, we’ve obviously seen the focus on this increase. And, the recent public negotiations with Walgreens highlighted that this is seen as a viable model for the future.

The question now is whether this will accelerate adoption of some type of limited network. If it goes forward, there are lots of questions to answer:

  1. How small will the network be – regionally, nationally?
  2. Who do you build the network around – CVS, Walgreens?
  3. What does this mean for mail order?
  4. What rates do the retailers have to match to participate?
  5. Does it include 90-day?
  6. Does the network start to look like a formulary where you have preferred pharmacies at one copay and non-preferred at another copay or is it either in-network or out-of-network?
  7. Does this increase or decrease power for the independents that have to be in certain places?
  8. Will anyone really test the national access standards and go to a 20,000 store network?
  9. What will consumers say and do?
  10. Does this accelerate adoption of cash cards and cash business for generics?

But, again, I struggle to see Wal-Mart as the chain that you build around unless the whitepaper is a thinly veiled attempt to push the direct-to-employer model (i.e., Caterpillar) which has saved the employer lots of money, but isn’t a simple to implement program (IMHO).

Here are some marketshare numbers for Walgreens, CVS, Rite-Aid, and Wal-Mart for the top 30 MSAs. Only 9 of those markets have Wal-Mart share above 10% and none are higher than 14%. For the other three, you have markets where they have a much higher concentration around which you can build.


Someone was asking me the other day if I saw the PBMs essentially partnering up. I’m not sure I do since there are markets where you would want to build a limited network with Walgreens and markets where you would want to build a limited network with CVS. At least for now, I don’t see Medco and Express Scripts just picking one dance partner although they might just based on who’s willing to play with them.

The other thing that becomes important here (tying this back to my Silverlink work) is communications. You have to identify who will be affected in moving to a limited network. You have to communicate with those people and help get them to the preferred pharmacy. You have to help them understand why you are doing this (savings) and WIIFM (what’s in it for me).

It creates some great dialog between the head of benefits and the CFO. We can save $X…BUT we will have to ask Y% of our employees and their families. Will they care? Do they know their pharmacist (unlikely)? Will it be an issue of convenience? Will they complain (of course…change is hard)? Will they ultimately care (unlikely as most disruption becomes accepted after 3-6 months)?

Should Restaurants Use Characters To Promote Unhealthy Foods?

I find this to be an interesting debate similar to should companies be able to promote smoking.  On the one hand, kids are obviously motivated to go to a fast food restaurant to get the latest toy that comes with the kids meal.  On the other hand, they can’t do it unless their parents take them there.

Additionally, you have to think about what the consumption of these fast foods are by the general population to understand if kids are eating the food at a higher rate than their parents.  I’m not sure you could look at families versus couples because by the nature of families being busier and more scheduled they are less likely to eat prepared meals at home.

These high level issues are important because if kids are likely to eat the meals anyways than why not give them a free toy because you are essentially using marketing to get them to choose one restaurant over another based on the toy.  If it is the toy that is changing their eating habits then we have a different issue – commercials, over-scheduling, parental control, access to healthy meals and snacks, and general eating habits of the population.  I struggle with the argument that the companies themselves shouldn’t be allowed to advertise.

But, I do think there is comparative research which has been done on tobacco and alcohol advertising (i.e., the Marlboro Man).

A factoid I saw in Time this morning was that

“Celebrity sells…kids think food tastes better when a popular carton character appears on the packaging…But, the flavor boost occurs only with junk food, not healthy snacks like vegetables.”

Even with that data, 47% of the child-marketing budgets for fruits and vegetables are on licensed characters compared to 29% of the dairy budgets, 15% of the junk food budgets, and 7% of the candy and ice cream budgets.

Don’t Take OTC Drugs (Cold Medicine) and Drive?

Why don’t we all just stay home or set up a massive public transportation system across the US.  Since over 50% of consumers take a maintenance drug, I can only imagine the percentage of people who take either a maintenance prescription drug or an over-the-counter (OTC) medication.

And, now the government wants to issue a warning about driving while taking medication and throw that in the same bucket as illegal drugs, driving drunk, and texting while driving.  Do they have any studies here?  Don’t medications that make you drowsy require labeling (not that anyone reads it or follows it)?

I guess I’m just confused at someone coming out and making broad statements like this.

Washington (CNN) — Add driving while on drugs — even it’s just cold medicine — to the list of distractions behind the wheel to which authorities are giving special attention.

National Drug Control Policy Director Gil Kerlikowske, a former police chief in Seattle, said drivers need to know they might be impaired if they have taken prescription or over-the-counter drugs, just as with illegal drugs.

“Drugs adversely affect driver judgment, driver reaction time, their motor skills and their memory,” said Kerlikowske, telling reporters the effects can be similar to those of driving under the influence of alcohol.

CVS and Walgreens Reach Resolution

I’ve tried to stay out of this since my initial posts on this, but it has certainly added some excitement to the industry over the past couple of weeks. I can’t remember one topic stirring so many reporters, analysts, sales people, and other potentially affected constituents.

As I’ve predicted from the beginning, both CVS Caremark and Walgreens came to resolution. It was in their mutual interest. I know there are a few sales people at the other PBMs that are disappointed as they hoped for this to be a wedge in several open RFPs. I think it may actually work against the other PBMs depending on the terms.

We know that Walgreens wanted higher reimbursement rates that other pharmacies. My question is whether they were acting like the UAW with the Big 3 auto companies. The UAW would reach agreement with two of them and then strike the 3rd one. Did the other PBMs give Walgreens higher reimbursement rates and then CVS Caremark finally draw the line in the sand? If so, does CVS Caremark have better rates and will they be even more aggressive around pricing in the sales cycle this year?

On the other hand, I know people at the other PBMs that were hoping for either a validation of the limited network concepts that have been around forever with limited adoption or to see them come to terms and hope that they can draw a line in the sand similar to CVS Caremark. For those outside the two companies, it was a win-win scenario while it was a lose-lose scenario for the two players if they didn’t reach resolution.

So, what happens now?

Will there be a Maintenance Choice offering with Walgreens in the network for 90-day scripts? I’m not sure here. Retailers have always struggled to over mail reimbursement rates at retail especially with less foot traffic, but I have to imagine that CVS and Walgreens have similar buying power.

Does this validate the concept of a retailer owned PBM (which as I’ve pointed out before is not unique to CVS)? I’ve talked many times about my support of this concept and think it’s only those with something to gain who are keeping this concept an issue. The independent pharmacies who are losing to mostly chains but also mail and the other big PBMs especially Express Scripts that had made a bid for Caremark before CVS bought them.

Walgreens vs. CVS More Thoughts

This was definitely the hot topic yesterday. I talked to lots of people about it.

I had a chance to give it some more thought last night. A few things dawned on me.

1. Timing. This was timed well from a Walgreens perspective. Managed Care RFPs are mostly over and employers are making their decisions now on PBM services. Managed Care would have been more likely to focus on the cost and understand how to mitigate the disruption. Employers will be much more sensitive to the disruption. That will be something that CVS Caremark will have to manage.

2. Who wins. Since one analyst told me that Walgreens represents only a single-digit of CVS Caremark’s revenue, the impact may not be huge. On the flip side, it’s likely some downside for Walgreens since they’ll stop serving some portion of CVS Caremark’s business. Consumers aren’t helped here. So, my only conclusion is that the other PBMs (i.e., Medco and Express Scripts) are best positioned to win from this if it causes any CVS Caremark PBM decisions to go their way. At a minimum, it creates FUD (fear, uncertainty, and doubt) which no sales person likes to have to deal with.

3. Validation. If I’m the product manager for Maintenance Choice at CVS Caremark, this seems like pretty strong validation that the offering works. As Adam Fein showed before, it does drive volume to their stores. Obviously, Walgreens was afraid of this taking off and having a larger impact on them.

So…what would I do?

This is interesting since one of my last tasks at Express Scripts was to come up with a strategy in late 2005 around CVS and Walgreens backing out of our mandatory mail network. My strategy (which I ultimately left to pursue) was to respond by opening onsite clinics and building out a pharmacy kiosk system that could be put in grocery stores (only 50% have pharmacies), large employer campuses, and high density sites in big cities. While Express Scripts didn’t choose that path, I still believe there is opportunity there and CVS Caremark could easily implement such a strategy. [It’s starting to get momentum in Canada.] CVS Caremark (or Walgreens for that matter) have the technology and business model to implement on-site pharmacies and to create a central fill using kiosks. If those could mitigate the effect of the Walgreens decision, it could be an interesting response. [BTW – If you’re interested in my pharmacy kiosk business model that I ultimately wrote up and pursued with some angel investors, let me know. I may try to post some of it here later.]

On the other hand, another response would be to look at the top 5 MSA (market service areas) where Walgreens is stronger than CVS. I’m guessing those are NY (post-Duane Reade acquisition), Delaware (post-Happy Harry’s acquisition), St. Louis (CVS just started operating here), and a few others. They could go into those markets and buy up independents or some smaller chains to immediately mitigate this.

There are several responses short of just folding and putting Walgreens in the network. Ultimately, I think it’s about whether CVS and Walgreens see each other as “enemies” or just competitors. Do they want to grow the pie or do they want to put the other out of business (if such a thing were possible)?

More to come I’m sure…

CVS Caremark Split Up?

I guess I have to comment on this hot topic.  Since I’ve been an advocate since the beginning, I think my opinions are different than the masses.  Looking at Adam Fein’s blog this morning, he asks three questions:

How does patient care improve when a PBM owns a brick-and-mortar pharmacy chain? Where can a combined PBM-pharmacy chain improve performance on traditional PBM metrics? How exactly does a payer benefit when CVS increases its pharmacy market share?

1. How does patient care improve?  CVS Caremark just announced this week the rollout of their Pharmacy Advisor program (think response to Medco TRCs).  This leverages their 7,000 retail stores and their face-to-face interactions with patients to manage chronic conditions (beginning with diabetes).  Assuming this scales, it has the great opportunity to improve patient care.  AND, when they eventually roll-in Minute Clinics to this solution (which I don’t think has happened yet) there may be more opportunity.  The retail side of the company also added to their ExtraCare strategy a diabetes focus earlier this week which makes a lot of sense. It remains to be seen the effect this could have on super beta prostate.

2. Where can a combined entity improve on traditional PBM metrics?  This is a softball.  Traditional PBM metrics are GFR (generic fill rate), rebates, mail order penetration, and trend (see comments on trend).  Generic fill rate involves talking with patients about therapeutic alternatives and intervening with MDs to change the script.  A retail chain can do that and can make changes before the first fill and before the patient starts a routine.  They also have a relationship often with the MD.  Driving rebates (as a proxy for lower net cost) can happen the same way.  Mail order is a more difficult metric, but Maintenance Choice createst that option and a store with the right POS (point-of-sale) system could make a difference.  I would argue that the goal for a combined entity is to optimize the right channel for the patient.  And, since all of these lead to lower trend…a combined entity has power.

3. How does the payor benefit?  Again…a softball.  Just like a limited network (less stores), pharmacies have always offered lower rates to payors (or PBMs) in return for marketshare.  CVSCaremark could offer tiers based on marketshare to their clients (i.e., you get a 17% discount for all Rxs processed if your marketshare is 30% and you get 19% discount if your marketshare is 40%).  There are obviously fixed costs (real estate, transportation, technology, staffing) so there are incentives for store operations to optimize volume (without getting too much such that they have to hire additional staff).

Health Reform And The PBMs

I’ve been getting a lot of questions about how health reform will affect the PBMs. While I will admit that I haven’t had the time to read all the tweaks and nuances of what was passed and realize it may change, my take is as follows:

  1. Assuming the PBMs stay part of any government type of solution, this will provide new covered lives for them to manage thereby growing business.
  2. Retail profits for combined entities like CVS Caremark may be negatively affected as cash patients are processed under negotiated contracts, but in so much as they can increase share at their stores, the ability to manage the distribution location (i.e., Maintenance Choice) may negate this.
  3. Generic biologics will be accelerated which will be a very positive play for the specialty business as generics have been for the PBMs. This will also allow the PBMs to use utilization management tools (e.g., step therapy) and formulary management tools which will drive savings and keep them as an essential entity.
  4. Financial disclosure may have a slightly negative effect by creating new reporting and auditing burdens and may ultimately affect client savings as deal parity becomes more normal versus allowing firms with better leverage and negotiating power to drive deeper deals. But, most PBMs are providing transparency today at a client level so this isn’t anything dramatically different.
  5. The focus on preventative services and wellness programs may actually create an expanded role for PBMs to step into the disease management void (which favors CVS Caremark’s model with clinics, retail, and PBM and Medco with their Therapeutic Resource Centers) and provide more services around critical conditions like diabetes and increase the focus on consumer engagement and adherence.
  6. The reduction in the donut hole and funding by pharma will negatively impact PBMs as it will encourage seniors to stay on brand drugs which are less profitable than generic drugs but it will increase adherence during the donut hole which will alleviate some of this downside.
  7. Overall, health reform should be a net positive for the PBMs allowing them to continue to be part of the strategy in reducing health care costs.

More thoughts from Adam Fein on his blog.

AHIP On Health Care Reform Legislation

America’s Health Insurance Plans (AHIP) President and CEO Karen Ignagni released the following statement on proposed health care reform legislation:

“For health care reform to work, everyone needs to be covered and the growth in health care costs must be brought under control. Health care reform legislation that does not address underlying medical costs cannot be sustained. Unfortunately, this legislation will drive up health care costs by adding billions in new health care taxes and encouraging people to wait until they are sick before getting insurance.”

Areas of Concern within the Bill

Lack of Cost Containment:

– Does Not Bend the Cost Curve – Health reform legislation that does not address underlying medical costs cannot be sustained. Unfortunately, this legislation lacks a system-wide approach that would actually bend the cost curve downward.

– Pilot Programs – The legislation takes a very timid and limited approach to addressing ways to control costs and improve quality. The legislation needs to take bolder steps by implementing throughout the entire health care system innovative payment and delivery system models that will help move the nation away from reliance on a fee-for-service payment structure and incentivize performance improvement across the board.

– IMAC – The legislation will not provide the comprehensive oversight needed because it would exempt Medicare payments for hospitals, physicians, and other key services from review during the first five years.

– Medical Malpractice Reform – The legislation needs to protect doctors who follow established best practices and implement safe, accountable care models based on the latest scientific evidence.

– Comparative Effectiveness – Comparative effectiveness research needs to look at both the clinical and cost effectiveness of tests, treatments, procedures, and prescription drugs so that patients and their doctors can make the most informed health care decisions.

Premium Tax:

– The legislation imposes a new $70 billion premium tax that the Congressional Budget Office (CBO) has said will be passed on directly to patients. This will raise the cost of coverage for individuals, families, and employers.

Market Reforms:

– Weak Coverage Requirement – The legislation will encourage people to wait to purchase coverage until they are sick, which unfairly penalizes those who currently have coverage. According to CBO, 23 million Americans will remain uninsured once this bill is fully implemented.

– Age Rating – The new age rating requirements will cause premiums to increase for people under the age of 30 by more than 50 percent.

Medicare Advantage:

– Massive Medicare Advantage Cuts – The legislation imposes $200 billion in cuts to Medicare Advantage that will cause massive disruption for the more than 10 million seniors enrolled in the program. If these cuts are enacted, millions of seniors in Medicare Advantage will lose their coverage, and millions more will face higher premiums and reduced benefits.

(See for what AHIP is promoting as a solution.)

The Stress Of The Healthcare Vote

I don’t spend a lot of time around politicians, but I had the chance this week to spend some time with lobbyists and people working with the lobbyists. One of the interesting things I heard about the healthcare vote is that politicians (especially the Democrats) were unusually stressed out about having to vote.

Basically, they’ve been told that they’ll be blackballed and unable to get any of their own initiatives pushed thru if they don’t vote for the bill.

And, many of them are seeing numbers that show only 50% of their constituents (at best) support the bill.

Therefore, it’s a lose-lose proposition. You’ve been elected to represent the people so you should do what they want. At the same time, we know that consumers are swayed by all the propaganda by both parties and multiple other groups. Do you know better?

It’s a great question. I haven’t been a big supporter of this reform while I 100% agree that our system is messed up. My recommendation continues to be to parse it up. First, solve coverage for the uninsured. Second, begin to address things like previous conditions. Third, focus on prevention and the payment / incentive systems.

And, I’m in the industry and don’t have time to keep up with all the changes and nuances to the legislation. I had finally resolved myself to reform and thought the bill(s) on the table right before the MA vote were probably ok (not great). But, I don’t know what’s changed since then and the meaning of those changes.

I saw some article about all the pork being put back in to the bills to get the vote. That makes me annoyed as a taxpayer.

Why Do We Need Healthcare Reform?

This was made a few months ago, but I think it does a good job of addressing some of the core issues.

Letter From HHS to Anthem RE Rate Increases

This was sent today (and then released to the public).

February 8, 2010

Leslie Margolin

President, Anthem Blue Cross

Delivered Via Fax

Dear Ms. Margolin,

One of the biggest pressures facing families, businesses and governments at every level are skyrocketing health insurance costs.  With so many families already affected by rising costs, I was very disturbed to learn through media accounts that Anthem Blue Cross plans to raise premiums for its California customers by as much as 39 percent. These extraordinary increases are up to 15 times faster than inflation and threaten to make health care unaffordable for hundreds of thousands of Californians, many of whom are already struggling to make ends meet in a difficult economy.

Your company’s strong financial position makes these rate increases even more difficult to understand. As you know, your parent company,WellPoint Incorporated, has seen its profits soar, earning $2.7 billion in the last quarter of 2009 alone.

I believe Anthem Blue Cross has a responsibility to provide a detailed justification for these rate increases to the public. Additionally, you should make public information on the percent of your individual market premiums that is used for medical care versus the percent that is used for administrative costs.  Policy holders in the individual market deserve to know if their premium increases would be invested in better medical care or insurance company overhead costs like salaries, profits, and advertising. I am aware that the State of California is investigating this matter, and urge Anthem Blue Cross to cooperate fully. In the meantime, I will be closely monitoring the situation.

At a time when health care costs are a critical threat to families as well as the nation’s economy, I hope you appreciate the urgent nature of this request. I look forward to your prompt reply.


Kathleen Sebelius

Secretary of Health and Human Services

Splitting Up CVS Caremark – Stupid – Just Learn How To Compete

The fact that the NCPA [see their press release on this] and others in the pharmacy community have chosen to push for the FTC to investigate the CVS Caremark merger and continue to encourage this is ridiculous.  CVS has owned a PBM (Pharmacare) for years.  Walgreens has its own PBMLongs had a PBM (RxAmerica).  Kroger’s has a PBM.  Unless I’ve missed it, I don’t remember hearing about them not being able to own a PBM or seen complaints about their ownership.  [And, like Adam Fein – I didn’t know this retrospective breakup was even an option.]

So, I perceive this whole FTC issue as a backhanded strategy to gain a competitive advantage over a competitor that’s beating them in the market.  [Just imagine the distraction of having to split the companies up or the hassle of having to put in a bunch of additional limitations.]  We know that independent pharmacies have continued to lose marketshare for years to retail chains and mail order.  It’s no different than any other market where scale matters (e.g., hardware stores).  If small pharmacies can compete, they should figure out how to make money and demonstrate value that people will pay for and stop focusing on crying wolf about a successful competitor.  [More on what I would do another time.]

I’ve been a big believer of retail and PBM integration for years.  At Express Scripts, we only thought there were a few companies that could buy us – Walgreens, Wal-Mart, or United.  At this point, I don’t see that happening, but I see lots of efficiency in leveraging plan design, retail face-to-face counseling, pharmacy automation at mail, and other coordinated solutions.

Another issue that is raised [in complaining about the CVS Caremark integration] are patient complaints.  These are certainly possible, but isn’t that a BBB issue or someone else’s issue.  Unfortunately, I bet you can’t find a pharmacy or a PBM without some patient complaints.  People take their healthcare personally and hate change.  BUT, I can’t imagine that I would go to the government and point out that some clients of my competitor aren’t happy.  [And the fact that politicians believe the hype and try to push stupid legislation like HR 4489 makes a mockery of our government.]  I’ve talked about transparency before so I won’t harp on this here, but how many companies (in our capitalist society) are required to provide data about margins and forced into a certain business model. 

Another issue you hear is about CVS Caremark “steering” people to preferred pharmacies (CVS, mail, specialty).  First off, this is not a PBM decision.  Limited retail networks have been an option for ever.  Clients chose what plan designs to implement.  The PBM’s job is to implement these plans and manage them effectively.  PBMs and consultants (e.g., Hewitt, Mercer) often model out the options for the clients so they learn how to save money.  And, in many cases given the pace of cost increases, if these options didn’t exist, then employers would drop benefits quicker.

Finally, the data doesn’t lie.  Members are generally very happy with the PBMs and mail order (or as much as they are with any “managed care” type company).  PBMs save clients money (and make money doing it).  PBMs provide clients with data.  Clients have lots of options for “transparent” companies and there’s been no big movement of marketshare to them.  PBMs drive adherence.  Mail order patients are more adherent.  Specialty mail order pharmacies drive successful outcomes.  The point is that the model works…stop trying to fight the model and come up with a better mousetrap. 

[Enough ranting for the evening.]

Transparency…Transparency – Enough

I was reading the NCPA blog this morning on PBM Transparency and the CVS Caremark Conundrum (more on that another time) and had to comment.  [Certainly not an unbiased blog.]

They talk about government intervention and transparency as:

“Small step toward reining in egregious and costly PBM practices like spread pricing (paying the pharmacy one price then quietly billing health plans much more) and rebate abuse (pocketing huge sums from drug makers before giving plan sponsors what’s left).”

Come on.  How many PBM clients don’t know that they have spread pricing?  Plus, don’t the retailers have spread pricing.  I’m pretty sure that consumers don’t know the acquisition cost of their drug compared to what they pay for it.  (There have been plenty of stories about the gouging at retail to cash patients using generics.)  There are plenty of PBM contracts today that are pass-through pricing meaning that the payor pays the PBM what they reimburse the retail pharmacy.  (I get so tired of people using arguements from the 1990’s and early 2000’s as fact.)

Then, let’s talk about rebates.  How many clients of PBMs today don’t know that rebates exist and don’t get most of the rebates passed on to them?  A lot of this data is available in general reports about the industry, from consultants, and thru surveys.  There aren’t a whole lot of mysteries in the PBM world.

The reality is that people get bitter because the PBMs continue to make money in a bad economy.  I don’t see what’s wrong with that.  They make money as they save clients money. 

  • More generics = more client savings and more PBM profit. 
  • More mail order = more client savings and more PBM profit. 
  • Lower trend (i.e., cost increases year-over-year) = more client savings and more PBM profit.

Some PBMs even take risk to put their money where their mouth is.  There have been numerous government and independent studies showing the value of PBMs.  There have also been enough “transparency” contracts out there from traditional PBMs and PBAs (Pharmacy Benefit Administrators) that there is proof that transparency doesn’t save money. 

I’ll talk more about why I think the CVS Caremark deal is good later.

Should Rx Data Be Used By Pharma?

This is a great question as posed by numerous people (see WSJ blog).  Now, the one reality that most people don’t realize is that the data is only directionally correct.  Not everyone sells their data to the aggregators so depending on pharmacy (or PBM) marketshare the data could be close to significantly off.

Perhaps, that’s not the issue.  The question is whether pharma should have a right to see prescription data by physician to understand their behavior.  It’s not patient specific data so that alleviates what I think should be the big issue.

Between patients visiting healthcare sites, registering for coupons, buying disease specific publications or supplies, the individual data is probably a lot easier to get and use…and probably more accurate (at least at the household level). 

Assuming no one says that pharma can’t communicate with physicians, I think the data is relevant.  Certainly, they have an agenda – drive marketshare of their drugs.  I think we have to assume that physicians aren’t just guppies that hear the pharma rep talk and do whatever they say.  Physicians are smart, well-trained professionals that should be able to hear messaging about drug pros and cons; look at the research; talk to their peers; talk to their patients; and appropriately prescribe. 

I think the prescription data probably creates a more efficient system.  Physicians that use a drug frequently are visited less often by the rep and don’t spend time away from patients.  Physicians that don’t prescribe a drug frequently (and prescribe a high volume of competitive drugs) probably get more visits…BUT they have the choice of saying don’t come. 

[I’m taking a little extreme of a view here since nothing is black and white, but I’m not sure I see the privacy issue here.]

Different Camps – Healthcare Reform

I think it’s pretty clear that there are a few different camps here.  Hearing Rahm Emanual (Obama’s chief of staff) say that the goal is to pass a bill thru Congress not figure out what the ideal bill might look like is certainly one perspective.  (NYTimes, 11/11/09, Falling Far Short Of Reform)  There are many camps trying to find the ideal solution.  Other people are looking at it from a budget perspective.  Others from a moral perspective of the need to cover the uninsured.  Others from a business perspective.

Can these all be reconciled?  No.  Not and get anything done. 

Everyone agrees the current system is a problem.  Can’t someone prioritize the issues and focus us on being successful with one goal at a time and not trying to put pieces that appeal to everyone into one bill that therefore meets the needs of no one.  The goal should never be just to pass a bill to meet some artificial deadline set by a candidate to impress the people.  The mess after the fact will be too difficult to change.

%d bloggers like this: