Kaiser Health News Original Stories

4. Political Cartoon: 'Disappointing, But No Copay'

Kaiser Health News provides a fresh take on health policy developments with "Political Cartoon: 'Disappointing, But No Copay'" by Dan Piraro.

Here's today's health policy haiku:

IT‘S LIKE ‘BRINGING A POCKET NURSE’ ON THE VISIT

For some home health aides
These tablets add expertise
To what they can do.

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Administration News

5. U.S. To Test The Waters With Medicare Drug Reimbursement Proposal

The proposal affects drugs administered in doctors offices or outpatient clinics. It is aimed at current reimbursement incentives that may encourage doctors to select higher-priced medications but not add benefits for patients.

The New York Times: U.S. To Test Ways To Cut Drug Prices In Medicare
The Obama administration said on Tuesday that it would test new ways to pay for prescription drugs in an effort to slow the growth of Medicare spending on medicines while encouraging doctors to choose the most effective treatments for their patients. The announcement comes as presidential candidates including Hillary Clinton, Senator Bernie Sanders and Donald J. Trump are calling for government action to protect consumers against high drug prices. Federal officials said the government spent $20 billion last year under Part B of Medicare for prescription drugs administered in doctors’ offices and hospital outpatient departments. (Pear, 3/8)

The Wall Street Journal: U.S. Officials Propose Test Program Aimed At Lowering Medicare Drug Costs
The development could lead to an overhaul of reimbursements under Medicare Part B, a program that pays about $19 billion a year to providers—and is outlined in a proposed rule issued Tuesday by the Centers for Medicare and Medicaid Services, which runs the program. The initiative is part of a strategy by the Obama administration and Congressional lawmakers to tackle health-care spending that is driven in part by rising prescription-drug prices, an issue that has loomed in the presidential race and ranks high among public concerns in polls. The administration has sought information on pricing from pharmaceutical companies and has been probing ways to help consumers keep their drug costs in check. (Armour, 3/8)

The Washington Post: Medicare Considers Overhaul Of Doctors’ Payments For Drugs
Patrick Conway, chief medical officer for CMS, said in a telebriefing that the plan isn’t designed to save money. But he left little doubt that the ultimate aim is to eliminate incentives that may encourage doctors to select higher-priced medications that benefit their bottom lines but not their patients. Conway called the current system — in which doctors are paid the average sales price plus 6 percent for handling and administration costs — a “perverse incentive structure that doesn’t benefit patients or the system.” He said oncologists have told CMS they sometimes feel pressure from their health-care systems to pick more expensive drugs to bolster profits. (McGinley, 3/8)

The Associated Press: Medicare To Test New Payment Model For Some Outpatient Drugs
Under the elaborate experiment being proposed by Medicare, parts of the country would operate under different payment rules for physician-administered medications. The results would then be compared, and if new approaches can maintain or improve quality while showing potential to curb costs, permanent changes could follow across the whole country. ... It's unclear how doctors and hospitals will respond. In the past, smaller oncology clinics have complained that Medicare cuts have a disproportionate impact on them. (Alonso-Zaldivar, 3/8)

Los Angeles Times: Obama Administration Proposes New Effort To Combat High Drug Prices
Facing skyrocketing drug prices, the Obama administration is proposing potentially major changes in how Medicare pays for some medications, including high-priced specialty drugs used to treat cancer and other costly diseases. The proposed regulations, unveiled Tuesday, would initially affect a relatively small share of the nation’s nearly $500-billion drug tab. But if widely implemented, they could overhaul the way Medicare, America’s largest insurer, pays for drugs, by linking payments to the effectiveness of medications, not just their prices. (Levey, 3/8)

Modern Healthcare: CMS Wants To Overhaul Part B Drug Payments. Oncologists Call The Plan 'Absurd.'
Ted Okon, executive director of the Community Cancer Alliance, tweeted soon after the announcement that the pilot “is the most contrived, absurd experiment on cancer care I have seen.” ... The American Society of Clinical Oncology lashed out at the Innovation Center's intent to “modify drug reimbursement based on Zip codes,” calling it “inappropriate for CMS to manipulate choice of treatment for cancer patients using heavy-handed reimbursement techniques.” ASCO added that physicians “did not create the problem of drug pricing and its solution should not be on their backs.” (Dickson, 3/8)

6. Expensive Specialty Drugs Help Drive Up U.S. Drug Spending

After years of slower growth, drug spending rose a "remarkable" 12.6 percent in 2014, according to a new federal report.

The Wall Street Journal: U.S. Prescription Drug Spending Is On The Rise
Prescription drug spending in the U.S. is rising and is projected to continue to climb faster than overall health spending, federal officials said Tuesday. Drug spending rose an estimated sharp 12.6% in 2014 after years of unusually slow growth—it rose about 2% a year between 2008 and 2012. The increase is largely due to higher-priced specialty medications and the fact that millions of people have gained insurance coverage through the Affordable Care Act, according to a report released Tuesday by the Department of Health and Human Services. (Armour, 3/8)

Reuters: U.S. Health Agency Estimates 2015 Prescription Drug Spend Rose To $457 Billion
Spending on prescription drugs is projected to have risen to $457 billion in 2015 and will likely continue to grow as a percentage of overall healthcare spending, a U.S. government health agency said on Tuesday. ... The agency forecast that total drug spending will grow to $535 billion in 2018 and represent about 16.8 percent of all healthcare spending. The figures are based in part on National Health Expenditure Accounts estimates from the Centers for Medicaid and Medicare Services. (Humer, 3/8)

USA Today: Feds Call Prescription Drug Price 2014 Increase 'Remarkable'
Fast-rising drug prices coupled with the use of costlier specialty drugs were the main reasons for a nearly 13% uptick in prescription drug spending in 2014, federal health officials said Tuesday. The Department of Health and Human Services called drug growth in 2013 “subdued,” but said 2014’s increase was “remarkable” and that it remained elevated during 2015 based on preliminary estimates. (O'Donnell, 3/8)

STAT: Higher Prices, Changing Preferences Driving An Increase In Drug Spending
Rising prices and a shift toward more expensive medications are driving the increases in prescription drug spending, according to a new report from the US Department of Health and Human Services. ... In a statement, Pharmaceutical Researchers and Manufacturers of America, the main industry trade group, said the report overlooks the contribution of new medications that have helped people live longer lives. The report “ignores the tremendous value medicines provide to patients, including many that offer improved treatment options for conditions that previously had few or no options, such as cancer and multiple sclerosis,” said PhRMA spokeswoman Holly Campbell. (Scott, 3/8)

Meanwhile, the pharmaceutical industry is spending billions on ad buys —

STAT: Drug Spenders Now Spend $5 Billion A Year On Advertising. Here's What That Buys.
Under fire for spending so much on advertising, drug makers are doubling down. Even as politicians and physicians press for strict limits on prescription drug ads, the pharmaceutical industry is pouring billions into new TV and print campaigns. Ad spending soared more than 60 percent in the last four years, hitting $5.2 billion last year. (Robbins, 3/9)

Health Law Issues And Implementation

7. Tax Time Crunch: Health Law Penalties Catching Up To Many Taxpayers

H&R Block reports that among its customers, 60 percent of filers who were getting tax credits to help pay their health insurance premiums in 2015 end up owing money back to the government and the average fine for people who didn't buy insurance is doubling.

The Wall Street Journal: Repayment Of Health-Insurance Tax Credits Threatens Refunds
Most people who got tax credits to buy insurance under the federal health law will be repaying part of them for the second year in a row, according to a leading tax preparer. H&R Block Inc. executives said Tuesday that, to date, 60% of 2015 tax filers with the credit have found that they owe the government money because they had been credited too much. That is up from 52% last year, the first year in which filers had to reckon with reporting the credit and figuring out if their income projections had been accurate. (Radnofsky, 3/8)

The Associated Press: Health Law Fines Double For Many Uninsured At Tax Time
Many people who went without health insurance last year are now seeing fines more than double under President Barack Obama's health care law, tax preparation company H&R Block said Tuesday. Among its customers who owe a penalty for the 2015 tax year, the average fine is $383, compared with $172 for 2014, the company said. Separately, among those who complied with the law and took advantage of its taxpayer-subsidized private health insurance, 6 in 10 are now having to pay back to the IRS some portion of their financial assistance. (Alonso-Zaldivar, 3/8)

The Detroit Free Press: Upfront Affordable Care Act Credit Hits Some Tax Refunds
Tax filers who obtained money-saving tax credits upfront to buy health insurance are now finding they have to pay back an average $579 this tax season, according to data from H&R Block. ... At the same time, more than one in three taxpayers who claimed the Advance Premium Tax Credit actually overestimated their income and ended up qualifying for a bigger credit. This group is receiving an additional refund — more than $450 on average. (Tompor, 3/8)

The Chicago Tribune: Will You Have To Pay An Obamacare Tax Penalty?
If you bought health insurance last year through Obamacare, you may be pleasantly surprised at tax time to find out you have money coming to you. But it
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