Tag: Omnicell

Who Could Drive Bipartisan Health Reforms In The U.S. Senate?

By Ken Perez, vice president of healthcare policy and government affairs, Omnicell, Inc.

Ken Perez

During the 2020 presidential election campaign, the top dozen or so health policies advocated by the Biden-Sanders Unity Task Force Recommendations, the Democratic Party Platform, and the Joe Biden for President Campaign Website fell into two distinct categories: ambitious progressive policies that would probably require a “go-it-alone” approach by the Democrats; and more moderate bipartisan policies that could be passed under the current rules in the Senate as an outcome of traditional political compromise.

Pursuit of the former approach is fashionable, as many Senate Democrats have advocated elimination of the filibuster. In addition, Senate Parliamentarian Elizabeth MacDonough recently determined that Democrats may be able to employ a fast-track process known as budget reconciliation multiple times before next year’s midterm elections, potentially allowing them to pass a bill with a simple majority, assuming that all 50 Democrats fall in line and Vice President Kamala Harris casts the tie-breaking vote as president of the Senate.

Nevertheless, there are key players in the Senate dedicated to pursuing bipartisanship.

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The American Rescue Plan Act of 2021: What’s In It For Hospitals?

Ken Perez

By Ken Perez, vice president of healthcare policy and government affairs, Omnicell, Inc.

On February 27, the U.S. House of Representatives passed H.R. 1319, the American Rescue Plan Act of 2021. One week later, on March 6, the U.S. Senate passed its own version of the bill, on a 50-49 party-line vote, under budget reconciliation which allowed for passage of the bill by a simple majority.

The House took it up on March 9. Notably, the Senate removed a phased-in federal $15 minimum-wage mandate.

In late February, the American Hospital Association had lobbied for $35 billion in targeted emergency funding for hospitals across the nation. However, neither the House nor the Senate version included that level of assistance, though H.R. 1319 does include a number of provisions that either directly or indirectly benefit hospitals:

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The Prospects For Reining In Prescription Drug Costs Under A Biden Administration

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez

The cost of prescription drugs is one of the top reasons why the U.S. spends much more on healthcare on a per capita basis than economically similar countries. The general public understands this, as polls consistently show that high drug costs are the number one healthcare issue for Americans.

Congress certainly understands this as well, as there have been numerous attempts in recent years—many of which have garnered some bipartisan support—to slow the growth of prescription drug costs. However, the devil has been in the details, precluding passage of substantive legislation.

The inaction by the legislative branch led President Donald Trump to sign on July 24 four executive orders aimed at reducing drug prices and ensuring access to medications.

The first order directed federally qualified health centers to pass along discounts on insulin and epinephrine received from drug makers to medically underserved patients.

The second order allowed states to develop plans for safe importation of certain drugs, authorize the re-importation of insulin products made in the United States, and create a pathway for personal importation through the use of individual waivers to purchase drugs at lower cost from pre-authorized U.S. pharmacies.

The third order required that kickbacks between drug makers and pharmacy benefit managers be passed along to seniors as discounts in Medicare Part D.

The fourth order authorized the Centers for Medicare and Medicaid Services (CMS) to take action to ensure that the Medicare program and seniors pay no more for the most-costly Medicare Part B drugs than any economically comparable OECD country. (This concept was first introduced by the Trump administration as a rule in October 2018.)

Per the fourth order, on Nov. 20 CMS issued an interim final rule for the Most Favored Nation (MFN) Model that would lower prescription drug costs by paying no more for Medicare Part B drugs and biologicals than the lowest price that drug manufacturers receive in 25 other industrialized countries, normalized by GDP per capita.

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The Biggest Risk for Hospitals In Biden’s Healthcare Plan

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

If one asks the average American what is former Vice President Joe Biden’s healthcare plan, it’s likely that they will say it is about restoring the Affordable Care Act (ACA), and some may mention the idea of a public option —Medicare or something like Medicare made available to more people.

Those high-level impressions are certainly accurate. Biden’s official campaign website quotes the presidential candidate as saying, “We have to protect and build on Obamacare,” and Biden’s current policy stances touch upon the ACA’s three main areas of focus: access, quality and cost.

Biden’s plan for healthcare has been best articulated in two documents. First, negotiations during June with representatives of Sen. Bernie Sanders (D-Vt.) produced the “Biden-Sanders Unity Task Force Recommendations,” a 110-page document which was released in early July. Second, the 2020 Democratic Party Platform, a 92-page document, was approved by the Democratic National Committee’s Platform Committee on July 27 and adopted during the 2020 Democratic National Convention in mid-August.

As was the case with the ACA, both documents affirm healthcare as a human right, advocating “free or low-cost healthcare coverage for every American, including by expanding Medicaid, subsidizing employer health insurance for people who lose their jobs, and offering a high-quality low or no-cost public option available without a deductible and with automatic enrollment for those who qualify throughout the COVID-19 crisis.”1

In general, expanding coverage benefits hospitals by reducing bad debt expense, which for U.S. hospitals averaged 1.73% of revenue in 2018.2 According to Rich Umbdenstock, former president and CEO of the American Hospital Association (AHA), the hospital industry agreed to support the ACA because the Obama administration and Congress promised that at least 97% of Americans would have healthcare coverage.3 In like manner, the Biden healthcare plan’s promise to increase access and expand coverage make it attractive to the hospital industry.

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Real-World Applications of Artificial Intelligence To Improve Medication Management Across the Care Continuum

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez

Discussions about the application of artificial intelligence (AI) in healthcare often span multiple areas, most commonly about making more accurate diagnoses, identifying at-risk populations, and better understanding how individual patients will respond to medicines and treatment protocols.

To date, there has been relatively little discussion about practical applications of AI to improve medication management across the care continuum, an area this article will address.

The Significance of Medications

What’s the first thing that comes to mind when someone mentions prescription drugs in the United States? In poll after poll, the high and rising costs of medications are American voters’ top healthcare-related issue.

This concern is well founded. The U.S. spends almost $400 billion a year on medications–$325 billion on a retail basis and about $75 billion for inpatient and outpatient use.

To put the $400 billion in perspective, it is equal to about 11% of total U.S. healthcare expenditures, and it’s one of the top reasons why the U.S. spends much more on healthcare than other industrialized countries.

Medication Management Shortcomings

Unfortunately, there are a lot of issues with the medication management system, broadly defined.

It’s estimated that 20-30% of prescriptions are not even filled, not even picked up at the retail pharmacy. According to the Centers for Disease Control and Prevention (CDC), each year, adverse drug events result in 1.3 million visits to the emergency department, and of those ED visits, over a fourth, 350,000, result in hospitalizations, which result in significant costs.

Over the past 50 years, much legislation has been passed to regulate and reform the U.S. healthcare system, and this has significantly increased the administrative burden on healthcare provider organizations. As a result, according to data from the Bureau of Labor Statistics, the National Center for Health Statistics, and the United States Census Bureau’s Current Population Survey, the number of administrators has grown by 3,200% since 1970, while over the same period, the number of physicians has been relatively flat, in line with population growth. Correspondingly, per research funded by the Physicians Foundation, it is estimated that the average physician and/or his or her staff spends 785 hours per year on quality reporting.

The administrative burden also falls heavily on pharmacists. According to a national survey by the American Society of Health-System Pharmacists (ASHP), pharmacists spend over three-fourths of their time on non-clinical activities—mostly manual, administrative processes.

In spite of the massive amount of spending on medications, the medication management system is fraught with errors at multiple steps in the medication-use process, prescriptions are often not filled, and over one-fourth of all hospital readmissions are potentially preventable and medication related.

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Why I’m Optimistic About The Development of A COVID-19 Vaccine

By Ken Perez, vice president of healthcare policy, Omnicell

Ken Perez

While proper hand hygiene, personal protective equipment, social distancing, testing, and therapeutics are all valid and useful measures in the battle against SARS-CoV-2, the virus that causes COVID-19, a safe, effective vaccine is the only path to normal. It is the ultimate game-changer. As one reader recently wrote to The Buffalo News, “Without a COVID-19 vaccine, there is no Hollywood ending.”

It certainly won’t be easy. In general, over 90% of vaccine candidates fail, and vaccines usually take several years, not months, to develop. Despite 33 attempts at a vaccine for Severe Acute Respiratory Syndrome (SARS), which spread worldwide in a few months from China in 2002, no SARS vaccine exists today.

Similarly, for Middle East Respiratory Syndrome (MERS), which started in Jordan in April 2012 and spread to a total of 27 countries, all 13 vaccine candidates to date have failed.

As of this writing, the novel coronavirus has infected 5.6 million persons and caused some 350 thousand deaths across over 200 countries. It is highly transmissible—spread by even asymptomatic individuals—and it is “wily,” as it has mutated over a dozen times. In short, it constitutes an epochal challenge for all of humankind.

Nevertheless, there are reasons to be optimistic about the chances for successful development of a COVID-19 vaccine.

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The Doctor Won’t See You Now: The Unintended and Perhaps Inevitable Consequences of Medicare-for-All

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez

“If you like your healthcare plan, you can keep it,” President Barack Obama famously said—many times—of his landmark Patient Protection and Affordable Care Act.

But the promise was impossible to keep.

In the fall of 2013, when cancellation letters—notices of cancelled plans—went out to approximately four million Americans, the public realized Obama’s assurances were wrong. As a result, PolitiFact named “If you like your healthcare plan, you can keep it” the “Lie of the Year” for 2013. Readers in a separate online poll overwhelmingly agreed with the choice.

The ambitious Medicare-for-All plan of Sen. Elizabeth Warren (D-MA), by explicitly abolishing private health insurance, obviously doesn’t promise that you’ll be able to keep your health plan, but many tenuous assumptions about it are being made, without much scrutiny. To be fair, some of these assumptions are of the wishful thinking variety, residing just in the minds of the public.

To date, the vast majority of the media coverage and, therefore, the public’s general understanding of the Warren plan have focused on its economics—the societal cost, i.e., what the nation as a whole will spend on healthcare over 10 years, from 2020 thru 2029, and the plan’s federal cost, i.e., the increase to the federal government’s spending over the same period of time and how that will be funded.

Warren promises that with her plan “Americans [will] have access to all of the coverage they need … including vision, dental, coverage for mental health and addiction services, physical therapy, and long-term care …”

But will they really have access? Canada, with a single-payer healthcare system, scored last of 11 high-income nations in terms of wait times for elective surgery and specialty consultations according to studies by the Commonwealth Fund. In Canada, according to Michael McKee—a Canadian surgeon who worked for more than 30 years under that country’s single-payer system—hospital resources, operating room time, implant budgets and other revenues are tightly and strictly rationed.

And what will happen to the quality of care when Americans manage to see a physician under Medicare-for-All? Based on a study of 67 countries published in the British Medical Journal in July 2017, the United States ranked second in average physician consultation time, at slightly above 21 minutes. Only in Sweden do physicians spend more time meeting with patients.

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10 Years After the HITECH Act: Assessing the Federal Government’s Subsidization of Electronic Health Record Adoption

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez

It was such a beautiful, logical vision: The creation of “an electronic circulatory system for health information that nourishes the practice of medicine, research, and public health, making health care professionals better at what they do and the American people healthier,” as David Blumenthal, the National Coordinator for Health Information Technology from 2009 to 2011, wrote in an article on the potential of the HITECH Act’s subsidization of the adoption of EHRs by hospitals and physician practices that appeared in the Dec. 30, 2009, issue of the New England Journal of Medicine.

The HITECH Act was combined with the American Recovery and Reinvestment Act of 2009 (ARRA), an economic stimulus bill created to help the U.S. economy recover from an economic downturn that began in late 2007. The passage of the bill spawned an ambitious vision of an elaborate national health information infrastructure that would enable frictionless, collaborative data sharing primarily through a National Health Information Network (NHIN) that would connect an interlocking web of regional health information organizations (RHIOs) and health information exchanges (HIEs).

It must be emphasized that the NHIN vision was a federal government vision—not one generally shared by the private sector. It was never realized, and the adoption of EHRs by healthcare providers has been described as “a digital revolution gone wrong” and “a bridge to nowhere,” in the 15-page cover article of Fortune magazine’s April issue, entitled “Death by a Thousand Clicks,” by Erika Fry of the magazine and Fred Schulte of Kaiser Health News.

For their report—which has the feel of an exposé — Fry and Schulte interviewed more than 100 physicians, patients, IT experts, administrators, health policy leaders, attorneys, government officials, and representatives from several leading EHR vendors. They employ a combination of poignant vignettes of patients who were harmed by EHR shortcomings — including the experiences of former Vice President Joe Biden’s son Beau and the husband of CMS Administrator Seema Verma — as well as ample facts and figures.

Per Fry and Schulte, the federal government has spent $36 billion to date to subsidize the adoption of EHRs by healthcare providers, and today, 96 percent of non-federal acute care hospitals and 86 percent of physician offices have EHRs.

Despite the significant amount of federal funding and broad adoption of EHRs, they have not fulfilled their potential, as Blumenthal has admitted. The expected “digital dividend” from EHRs has not materialized, or at least its magnitude is much smaller than hoped for. According to Fry and Schulte, EHRs’ general demerits include poor, tedious usability—which adds work and is cited as a major contributing factor to physician burnout — rampant errors that lead to patient safety risks, “upcoding” (bill inflation), lack of interoperability, widespread data blocking, and patients’ inability to access their EHRs. Data silos clearly exist between the 700 federally certified EHRs of widely varying functionality, as well as between provider organizations and other players in the healthcare system. In short, idealism has run into the reality of commercialization.

Fry and Schulte provide no optimistic, Hollywood ending to the article. Industry attempts to promote interoperability are described as fledgling, and their sobering conclusion is that the state of EHRs in the United States is “an unholy mess.”

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The 340B Drug Pricing Program: A Federal Court Enters the Fray

By Ken Perez, vice president of healthcare policy, Omnicell.

Ken Perez
Ken Perez

The 340B Drug Pricing Program was created in 1992 to give safety net providers — those that deliver a significant level of both healthcare and other health-related services to the uninsured, Medicaid, and other vulnerable populations — discounts on outpatient drugs to “stretch scare federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.” In brief, the program requires drug makers participating in Medicaid and Medicare Part B to provide discounts on outpatient drugs to 340B providers, which include various types of hospitals and certain federal grantees, such as federally qualified health centers and comprehensive hemophilia treatment centers.

For years, the 340B program has been fraught with controversy, with concerns raised about the program’s lack of accountability and oversight, and findings of widespread diversion of benefits (discounted drugs) to ineligible patients.

The nonpartisan Medicare Payment Advisory Committee (MedPAC) found that hospitals in the 340B program receive a minimum discount of 22.5 percent of Average Sales Price (ASP) for drugs paid under the Medicare Hospital Outpatient Prospective Payment System (OPPS). The Office of the Inspector General of the U.S. Department of Health and Human Services (HHS) found that the average 340B discount was 34 percent of ASP, and at least two organizations with 340B members estimated that 340B discounts could be as high as 50 percent of ASP.

Based in part on these findings, in 2017 HHS proposed and finalized a rule implementing a sharp reduction in 340B reimbursement of hospitals by the Centers for Medicare and Medicaid Services from ASP plus 6 percent to ASP minus 22.5 percent, along with an offsetting payment rate increase for non-drug items and services. It was estimated that 85 percent of 340B hospitals would see overall net payment increases in 2018 as a result of these changes, and that 340B hospitals would continue to benefit financially from the program.

Nevertheless, the American Hospital Association (AHA), America’s Essential Hospitals, and the Association of American Medical Colleges—all non-profit hospital associations—filed suits against HHS to block the change.

On Dec. 27, 2018, Washington, D.C. federal district court judge Rudolph Contreras (a Democrat nominated by President Barack Obama), issued a 36-page ruling in favor of the AHA, et al. and struck down the 340B payment reduction, contending that HHS Secretary Alex Azar exceeded his statutory authority by issuing a policy that would “fundamentally rework the statutory scheme.”

Contreras issued a permanent injunction of the new reimbursement policy, but he did not grant the plaintiff’s request for retroactive OPPS payments based on the original reimbursement formula. (HHS is unable to come up with the monies to pay back the hospitals, as they have already been spent.) Contreras ruled that the plaintiffs “are entitled to some relief,” but, recognizing “the potentially drastic impact of …[his] decision on Medicare’s complex administration,” he ordered a supplemental briefing to come to a “proper remedy.”

There are two issues in dispute:

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The Political Plausibility of Medicare for All

By Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez
Ken Perez

As widely reported, based on exit polls, healthcare—not the economy—was the top issue on voters’ minds in the 2018 midterm elections. This was due in part to the nation’s sustained economic recovery of the past two years, resulting in the current healthy state of the economy in general. In addition, Democratic Party political advertising emphasized healthcare—61 percent of pro-Democratic House ads from Sept. 18 to Oct. 15 mentioned healthcare, compared with just 10 percent of all Democratic ads in 2016.

According to several analysts, the Democrats’ success in taking back the House was largely due to their riding the “train of healthcare,” with a large proportion of Democrats in Congress supporting the idea of single-payer healthcare as embodied in Independent Vermont Sen. Bernie Sanders’s “Medicare for All” bill that he introduced in Sept. 2017.

Many of the most likely Democratic candidates for president in 2020 have publicly expressed their support of Medicare for All. Five of the seven most likely Democratic candidates from the Senate cosponsored the Medicare for All bill: Cory Booker of New Jersey, Kirsten Gillibrand of New York, Kamala Harris of California, Jeff Merkley of Oregon and Elizabeth Warren of Massachusetts. Some of the possible Democratic candidates from the House (e.g., Rep. Beto O’Rourke of Texas) and current and former Democratic governors (e.g., former Massachusetts Gov. Deval Patrick) are also Medicare for All backers.

At this point, what is the plausibility of Medicare for All becoming law after the 2020 elections?

It would obviously require the election as president of Sanders or a Democratic candidate who supports a single-payer system. In addition, the Democrats would need to retain their new majority in the House, and they would also need to attain a 60-seat majority in the Senate to overcome a possible minority party filibuster by the Republicans, assuming their united opposition. Note that the Patient Protection and Affordable Care Act passed in the Senate by a 60-39 vote, with not a single Republican senator voting for the bill.

A 60-seat Senate majority for the Democrats is not very likely to happen in 2020. Evidently, the Democrats will have 47 seats in the Senate once the 2018 midterm election results are finalized. The most aggressive current projection from a Democratic perspective regarding their Senate prospects in 2020 is a flipping of five seats presently held by Republicans (in Arizona, Colorado, Iowa, Maine, and North Carolina), resulting in a 52-seat majority. However, even that outcome would be eight seats short of the 60 needed. Thus, it appears that it would take some combination of executive branch meltdown (e.g., impeachment proceedings) and retirements by multiple Republican senators during the next two years in order for voters to flip an additional seven seats in the Senate to the Democrats in 2020.

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