Employer health insurance cost growth cut in half

• Employer-sponsored health insurance costs have increased about 3% annually since 2012 after a decade of 6% or more yearly increases, according to Mercer’s new National Survey of Employer-sponsored Health Plans.
• Factors cited include preemptive moves by employers to avoid the Affordable Care Act’s excise tax on high-cost plans, cost-shifting and consumerism, such as the rise of high-deductible plans.
• Despite those cost controls, smaller employers are facing higher increases. The report found that 34% of smaller employers, defined as having between 10 and 499 employees, saw health insurance cost increases of more than 10% in 2017.

With more market leverage and resources to target costs, larger employers can control costs more easily.

That said, despite the added influence over costs, nearly one-fifth of employers with 500 or more employees and 11% of businesses with 20,000 or more workers saw health plan cost increases of more than 10% last year.

The report predicted added cost pressures in the coming years. Cost-drivers include medical advances, technology, high utilization, an aging population and the expected increase of uninsured Americans, according to the report.

The uninsured rate has dropped since the ACA, but the numbers have moved back in the other direction over the past year. Mercer warned that more uninsured will mean more uncompensated care and those costs will wind up getting passed onto employer plans.

Another issue that employers face is that there aren’t many cost-shifting levers left. Businesses have pushed more out-of-pocket costs onto consumers. That movement has led to PPO deductibles rising by about 9% annually since 2012 among mid-sized and large employers to $966 in 2017. Small employers have increased deductibles annually by 6% to an average of $1,917 in 2017.

Employers, particularly large and mid-sized companies, have pushed employees to consumer-directed plans that often have a health savings account. Those plans had a minimum deductible of $1,300 in 2017.

With those kinds of deductibles, members are struggling to afford healthcare, and employers can’t shift many more costs onto them. This will mean employers need to find other ways to cut costs.

One potential area of savings is prescription drugs, including specialty drugs. Annual spending on specialty drugs nearly doubled between 2011 and 2015. Mercer said that will get worse as new drugs enter the market over the next few years. In response, more than half of employers are steering workers to specialty pharmacies.

Another avenue tried by large and mid-sized companies are Centers of Excellence (COE) for orthopedics, cardiology and oncology. The report said 41% of businesses surveyed offer COE for women’s health, such as infertility and pregnancy.

Mercer said businesses use the centers because of better outcomes and cost. In many cases, this allows employers to contract directly with high-quality rated providers, who are willing to maintain a level of value-based care.

Suzanne Delbanco, executive director of Catalyst for Payment Reform, a nonprofit that works with more than 30 employers and purchasers of healthcare, recently told Healthcare Dive: “The interest in direct contracting is not a coincidence. It’s one of the few strategies that employers can use.”

Meanwhile, Mercer found most employers aren’t using accountable care organizations or narrow network strategies. Fewer than 10% of businesses are trying those strategies.

Employers told Mercer that they plan to implement other cost-saving strategies over the next five years, including monitoring/managing high-cost claimants, better managing cost for specialty pharmacy and focusing on creating a culture of health.

https://bit.ly/2zyt10F

With Revlimid and Pomalyst price hikes, is Celgene next on Trump’s to-call list?

After public scrutiny and a phone call, President Donald Trump convinced Pfizer to at least defer its drug increases. But not all companies have flinched at the president’s “We will respond” threat, including makers of some of the world’s best-selling drugs.

Celgene increased the prices of two blockbuster cancer meds Revlimid and Pomalyst by 5% this month, according to SunTrust analysts. Roche raised the price of breast cancer drug Herceptin by 3%, and Avastin by 2.5%, Bloomberg reports. Novo Nordisk’s Tresiba, Levemir, Fiasp and NovoLog saw their prices up by 5%, while GLP-1 inhibitors Victoza’s and Ozempic’s jumped 7.9% in the same period, the diabetes specialist unveiled Wednesday.

While drugmakers are not raising prices at the same rate as some have in the past, they still fly in the face of the president’s threat.

In a statement to FiercePharma, a Celgene spokesman said the company made the increases “at less than the rate of anticipated U.S. healthcare spending growth for the year,” in line with CEO Mark Alles’ recent pledge.

A Roche spokeswoman, confirming those increases, said the company considers several factors when making decisions on drug prices, including “how well the medicine works and how it compares to other available treatments; the financial resources required to continue discovering new medicines for people with serious diseases; and how to ensure that the price doesn’t prevent our medicines getting to people who need them.”

Novo said in its notification Wednesday that the price increases “reflect the value our medicines offer in diabetes care and the current market dynamics to make sure patients’ insurance plans provide access to our medicines.” A Novo media aide told FiercePharma the company does intend to keep annual price increases within the 10% limit pledged in 2016.

Still, the timing of the latest round comes at a delicate time, as both the Trump administration and lawmakers have been criticizing high-rising drug prices in the U.S. Not to mention Pfizer’s Wednesday decision to bow to the government’s pressure and back down from its July increases after Trump called CEO Ian Read and swore to take action on those who raise prices without cause.

For Celgene, it comes right after CEO Mark Alles committed to limit the price increase of any medicine in its portfolio to only once a year, and at a level no greater than the projected growth in the U.S. healthcare expenditures. The current price increases are below the 5.3% rate predicted for this year, and also mean that Celgene has probably used up its annual quota for those two drugs.

But Alles’ statement also opened up room for exceptions where additional clinical or health economic evidence could support new increases. According to a Celgene spokesman, that is not on the company’s agenda, at least for now. “No further pricing actions for these or any of our other FDA-approved medicines are anticipated this year,” he said in a statement.

Price hikes aren’t a new tactic Celgene’s just adopted. In a Thursday note to investors, SunTrust analysts noted that the average yearly price increases Celgene had taken on those two multiple myeloma drugs in the U.S. are in the 10%-11% range over the last five years.

The U.S. big biotech raised eyebrows last year when it jacked up the price of Revlimid three times to an accumulative 19.8%, and the price on Pomalyst twice to reach a 17.7% jump. Revlimid’s $8.18 billion and Pomalyst’s $1.16 billion in 2017 sales represent a 17% and 23% jump, respectively. The company also admitted that price hikes boosted the company’s top line by 3.3% last year.

“[C]ontinued price increases in the U.S. (vs. continued price reductions ex-U.S.) on Celgene’s part could also bring CELG into the limelight (unfavorably),” SunTrust analysts wrote in their note.

Celgene, however, isn’t the only one who could put Trump’s typical Twitter fury to test. Goldman Sachs analyst Jami Rubin noted in a Wednesday note that Roche and Novo are the only other large-cap biopharma companies with a second price increase this year.

On July 3, Novo raised the price of some insulin products by 5%, and the price of its GLP-1 stars Victoza and Ozempic by 7.9%. The Novo spokeswoman noted that Tresiba and Levemir had a previous 4% increase this January, while the last increases for NovoLog, NovoLog Mix and Victoza happened over a year ago. Roche, for its part, increased cancer med Herceptin’s price by 3%, and Avastin’s by 2.5% in July, even though both drugs now face FDA-approved biosimilars.

https://bit.ly/2L4RPCa

CMS proposes to overhaul Medicare billing standards, pay for telehealth

The CMS on Thursday proposed paying doctors for virtual visits and overhauling Medicare billing standards it has had in place since the 1990s.

In a lengthy proposed rule, the agency said it would pay doctors for their time when they reach out to beneficiaries via telephone or other telecommunications devices to decide whether an office visit or other service is needed. In addition, the CMS also proposed paying for the time it takes physicians to review a video or image sent by patient seeking care or diagnosis for an ailment.

“This is a big issue for elderly and disabled population for which transportation can be a barrier to care,” CMS Administrator Seema Verma said. “We’re not intending to replace office visits but rather to augment them and create new access points for patients.”

Most physicians bill Medicare for patient visits under a relatively generic set of codes that distinguish level of complexity and site of care, known as evaluation and management visit codes.

Doctors long have been concerned about the codes’ documentation standards. The CMS has used evaluation and management visit codes since 1995.

The CMS proposed allowing practitioners to designate the level of a patient’s care needs using their medical decisionmaking or time they spent with the patient instead of applying the decades-old E/M documentation guidelines.

In addition, the agency wants to eliminate the requirement to justify the medical necessity of a home visit in lieu of an office visit and is considering eliminating a policy that prevents payment for same-day visits with multiple practitioners in the same specialty within a group practice.

“Today’s proposals deliver on the pledge to put patients over paperwork by enabling doctors to spend more time with their patients,” Verma said in a statement. “Physicians tell us they continue to struggle with excessive regulatory requirements and unnecessary paperwork that steal time from patient care. This administration has listened and is taking action.”

Elsewhere in the rule, the agency plans to continue a controversial site-neutral policy launched in 2018. For the second year in the row, off-campus facilities built after Nov. 2, 2015, will be paid 40% of the outpatient rates for the services they provide.

The policy “encourages fairer competition between hospitals and physician practices by promoting greater payment alignment between outpatient care settings,” the CMS said.

The proposed rule includes some significant changes to administration of MACRA including an opt-in option for physicians with a low volume of Medicare Part B enrollees or reimbursements and a waiver for clinicians who participate in a new Medicare Advantage demonstration.

In the wake of the Bipartisan Budget Act of 2018, the CMS is slowing implementation of the Merit-based Incentive Payment System (MIPS) and proposed slashing 34 quality measures that it deemed ineffective after hearing from stakeholders. The proposed rule adds 10 quality measures including four measures based on patients’ reporting of their outcomes. These are in line with HHS Secretary Alex Azar’s promise to keep rolling back paperwork and reporting requirements.

Physicians can opt into MIPS if they meet or exceed one or two of the following new-volume threshold criteria: incurring $90,000 or less in allowed charges under Medicare Part B; treating 200 or fewer Part B enrollees who are paid for through the Medicare physician fee schedule; or offering 200 or fewer covered services.

The CMS also moved forward with plans to have Medicare Advantage plans qualify as an alternative payment model through a demonstration program called the Medicare Advantage Qualifying Payment Arrangement Incentive (MAQI).

The demonstration would waive MIPS reporting requirements for clinicians who work within Medicare Advantage networks resembling advanced alternative payment models.

In the proposed rule, CMS officials focused on the exchange of digital health information, responding in part to the 21st Century Cures Act, which called for greater interoperability and an end to information blocking. The agency said there were still “significant obstacles” affecting that work, and it will push the matter with the 2019 requirements for certified electronic health record technology.

MIPS eligible clinicians will be required to use 2015 edition certified EHRs beginning next year, moving away from the 2014 edition products that some still use.

The CMS asserted that the move will save providers money. But some clinicians begged to differ.

“Today’s rule proposes to require physicians to deploy costly EHR upgrades for 2019 and takes further steps toward implementing burdensome appropriate use criteria,” said Anders Gilberg, Medical Group Management Association senior vice president for government affairs, in a statement.

Regulators also outlined new scoring methods and performance categories, including the overhauled “promoting interoperability” category, with which they’re pushing the digital exchange of health information between providers and also between providers and patients.

In general, regulators want to make the requirements of the MIPS promoting interoperability category similar to those of the promoting interoperability program for hospitals.

MIPS eligible clinicians will have to report on all measures for all objectives to receive scores in that category, according to the proposed rule.

Those measures are slated to change, the rule noted. The CMS wants to remove certain measures—including the patient-generated health data measure—that have been unduly “burdensome” for clinicians. It also wants to add measures, including one that would require clinicians to be able to query prescription-drug monitoring programs, in support of HHS’ work on the opioid epidemic.

https://bit.ly/2udN7bF

JNJ ordered to pay $4.14B punitive damages in talc cancer case

This follows $550M in compensatory damages awarded earlier today. The report also states that this marks the biggest jury award of 2018.

https://bit.ly/2Lc04fW

Cel-Sci aims to woo shareholders after CRO fight

• After Cel-Sci won an arbitration case against a CRO late last month, the biopharma appealed to its shareholders in a letter released Monday touting a promising future for its experimental immunotherapy in head and neck cancer.
• The dispute involved inVentiv (now know as SyneosHealth), which was contracted to carry out a Phase 3 trial for Cel-Sci’s Multikine. The CRO was found to have knowingly misled Cel-Sci, having promised to recruit 880 patients within 15 to 18 months. Instead, it recruited only 117 patients between 2011 and 2013.
• Cel-Sci hired a new CRO, and recruitment finally completed in September 2016 with an expanded patient total of 928. The company’s overall aim for 2018 is to get to the much-delayed readout of the Phase 3 trial for Multikine, which it hopes will confirm the drug’s efficacy.

Flush with success after winning a breach of contract arbitration with contract research organization inVentiv (now Syneos Health), Cel-Sci touted its future in the letter to shareholders, as well as emphasizing the damage done to Cel-Sci’s value by delays in the clinical trial.

According to Cel-Sci’s letter, investors that backed away during the arbitration process should come back.

“Now that the arbitration is resolved in our favor, this should no longer be an impediment to investors and should result in renewed investment interest in Cel-Sci,” said the letter.

The company is looking forward to the Multikine Phase 3 data, believing that it will have a significant impact on its market cap.

Cel-Sci boldly predicted that the compound, given Food and Drug Administration approval, would become part of the standard of care to be used in first-line head and neck cancer.

“Cel-Sci is a cancer immunotherapy company… In the past 18 months, several successful Phase 3 cancer immunotherapy companies were sold for $7 billion to almost $12 billion. They had positive survival data from their pivotal studies, but had not yet received FDA approval. Recently, one cancer immunotherapy company with not yet completed Phase 3 studies was sold for about $1.6 billion. Should the Cel-Sci Phase 3 study be successful, the potential market for our drug will be substantially larger than the markets of the multi-billion dollar companies mentioned above,” said the letter.

The prospects for Multikine might not be as rosy as the company purports. The delays to clinical trials were only in part due to the actions of the CRO — Multikine has been in development for the better part of a decade. The drug was placed on partial clinical hold for about a year. The future for Multikine is anything but certain; although that’s not how Cel-Sci is selling it.

https://bit.ly/2maHu9I

Dova downgraded as high price tag threatens to slow new drug’s pickup

• Investment bank Leerink lowered its rating for Dova Pharmaceuticals stock from “Outperform” to “Market Perform,” reflecting what analysts expect to be a slow launch of the biotech’s new drug because of its higher-than-expected price.
• The drug, Doptelet, received regulatory approval in late May as a treatment for adults with chronic liver disease who have low platelet counts and upcoming medical procedures that could cause increased bleeding. Dova is also looking to get Doptelet cleared for immune thrombocytopenic purpura (ITP), but in the meantime strapped it with a $9,000 to $13,500 price tag for a five-day regimen, depending on the dose.
• “This new rating reflects our views of the complex commercial environment for Doptelet in its first indication, and the uncertainty about the regulatory outlook for the ITP application,” Leerink analyst Geoffrey Porges wrote in a July 9 investor note.

Pfizer pulled a rare move this week when, following talks between CEO Ian Reid and President Donald Trump, it agreed to rescind a swath of newly enacted price hikes. The decision was surely seen as a win by the administration — which has, through the Department of Health and Human Services, reportedly been pushing drugmakers to slash prices — yet it’s not particularly reflective of wider pharmaceutical sentiment regarding price.

Despite intense pushback from payers and lawmakers, many drug manufacturers don’t look poised to enact meaningful price cuts anytime soon. The nation’s 10 largest companies suggested as much in response letters to Sens. Elizabeth Warren, D-Mass., and Tina Smith, D-Minn., last month.

Lofty price tags aren’t solely tied to big pharma either. Dova, for instance, raised eyebrows when it revealed a $9,000 wholesale acquisition cost for a five-day course of 40 mg Doptelet. Analysts noted the price is not only higher than the average platelet transfusion, but in many cases would be more expensive than whatever medical procedure patients were about to undergo.

And that could be a big problem for the drug’s uptake.

“Even for the patients that are most suitable for Doptelet, the patient identification, verification and approval processes mean many will not actually receive the treatment despite theoretically being eligible,” Leerink’s Porges wrote in the July 9 note.

Talking to proceduralists and liver specialists, Leerink also found many factors stand in the way of physicians adopting Doptelet treatment, such as scheduling logistics, reimbursement and cost.

“All these issues can be solved, but it seems likely that it will take many quarters before the provider and patient logistics are streamlined such that significant recurring treatment volume can be expected,” Porges wrote. Along with its rating downgrade, Leerink now expects $9 million in Doptelet sales in 2018 versus consensus of $13 million, and $347 million of sales in 2022 versus consensus of $343 million.

Dova, meanwhile, estimates a roughly $2.5 billion opportunity for its debut drug, comprised of about $800 million for the first indication and $1.7 billion for follow-on acute indications.

At investment bank Jefferies’ 2018 Healthcare Conference, Dova also laid out its early launch plans. Sales representatives began reaching out to mostly hepatologists, as well as some interventional radiologists, in early June.

Company leadership acknowledged too they didn’t intend to offer rebates at launch for the first indication, and didn’t think payers would be “actively managing the category,” according to a June 5 investor note from Jefferies analyst Eun Yang.

https://bit.ly/2JjEUar

New ways to conquer sleep apnea compete for place in bedroom

Every night without fail, Paul Blumstein straps on a mask that prevents him from repeatedly waking up, gasping for air.

It’s been his routine since he was diagnosed with a condition called sleep apnea. While it helps, he doesn’t like wearing the mask.

“It’s like an octopus has clung to my face,” said Blumstein, 70, of Annandale, Virginia. “I just want to sleep once in a while without that feeling.”

It’s been two decades since doctors fully recognized that breathing that stops and starts during sleep is tied to a host of health issues, even early death, but there still isn’t a treatment that most people find easy to use.

Airway pressure masks, the most common remedy, have improved in design, getting smaller and quieter, but patients still complain about sore nostrils, dry mouths and claustrophobia.

Now, new ways of conquering sleep apnea, and the explosive snoring that comes with it, are vying for a place in the bedrooms of millions of people craving a good night’s sleep. Products range from a $350 restraint meant to discourage back sleeping to a $24,000 surgical implant that pushes the tongue forward with each breath.

It’s been two decades since doctors fully recognized that interrupted breathing during sleep is tied to a host of health issues, but there still isn’t a treatment for sleep apnea that most people find easy to use.

Mouthpieces, fitted by dentists, work for some people but have their own problems, including jaw pain. Some patients try surgery, but it often doesn’t work. Doctors recommend weight loss, but diet and exercise can be challenging for people who aren’t sleeping well.

So far, no pills for sleep apnea exist, but researchers are working on it. One drug containing THC, the active ingredient in marijuana, showed promise in a study this year.

What is sleep apnea? In people with the condition, throat and tongue muscles relax and block the airway during sleep, caused by obesity, aging or facial structure. They stop breathing, sometimes for up to a minute and hundreds of times each night, then awake with loud gasping and snoring. That prevents them from getting deep, restorative sleep.

They are more likely than others to have strokes, heart attacks and heart rhythm problems, and they’re more likely to die prematurely. But it’s hard to tease out whether those problems are caused by sleep apnea itself, or by excess weight, lack of exercise or something else entirely.

For specialists, the first-choice, most-studied remedy remains continuous positive airway pressure, or CPAP. It’s a motorized device that pumps air through a mask to open a sleeper’s airway. About 5 million Americans have tried CPAP, but up to a third gave up during the first several years because of discomfort and inconvenience.

Martin Braun, 76, of New York City stopped using his noisy machine and awkward mask, but now he’s trying again after a car crash when he fell asleep at the wheel. “That’s when I realized, OK this is serious stuff already,” said Braun, who has ordered a quieter CPAP model.

Sleep medicine is a relatively new field. The most rigorous studies are small or don’t follow patients for longer than six months, said Dr. Alex Krist of Virginia Commonwealth University, who served on a federal guidelines panel that reviewed sleep apnea treatments before recommending against screening adults who have no symptoms.

“We don’t know as much about the benefits of treating sleep apnea as we should,” said Krist, vice-chair of the U.S. Preventive Services Task Force.

While scientists haven’t proved CPAP helps people live longer, evidence shows it can reduce blood pressure, improve daytime sleepiness, lessen snoring and reduce the number of times a patient stops breathing. CPAP also improves quality of life, mood and productivity.

With noticeable results, many CPAP users, even those like Blumstein with a love-hate relationship with their devices, persist.

Blumstein was diagnosed about 15 years ago after he fell asleep behind the wheel at a traffic light. He shared his frustrations with using a mask at a recent patient-organized meeting with the Food and Drug Administration, as did Joelle Dobrow of Los Angeles, who said it took her seven years to find one she liked.

“I went through 26 different mask styles,” she said. “I kept a spreadsheet so I wouldn’t duplicate it.”

Researchers are now focused on how to get people to use a mask more faithfully and predicting who is likely to abandon it and could start instead with a dental device.

“It’s the bane of my existence as a sleep doctor,” said Dr. James Rowley of Wayne State University in Detroit. “A lot of what sleep doctors do in the first few months after diagnosis is help people be able to use their CPAP.”

Getting it right quickly is important because of insurers’ use-it-or-lose-it policies.

Medicare and other insurers stop paying for a rented CPAP machine if a new patient isn’t using it enough. But patients often have trouble with settings and masks, with little help from equipment suppliers, according to Dr. Susan Redline of Brigham and Women’s Hospital in Boston.

All told, it can drive people toward surgery.

Victoria McCullough, 69, of Escondido, California, was one of the first to receive a pacemaker-like device that stimulates a nerve to push the tongue forward during sleep. Now, more than 3,000 people worldwide have received the Inspire implant. Infections and punctured lungs have been reported; the company says serious complications are rare.

McCullough said she asked her doctor to remove the device soon after it was activated in 2015.

“It was Frankenstein-ish. I didn’t like it at all,” McCullough said. “My tongue was just thrashing over my teeth.”

Others like the implant. “My quality of life is 100 percent better,” said Kyleene Perry, 74, of Edmonds, Washington, who got one in February after struggling with CPAP for two years. “People are saying, ‘You look so much better.’ I have a lot more energy.”

The THC pill, known as dronabinol, already is used to ease chemotherapy side effects. A small experiment in 73 people suggests it helps some but wasn’t completely effective. It may work better in combination with CPAP or other devices, said researcher David Carley of the University of Illinois at Chicago. He owns stock in Respire Rx Pharmaceuticals, which has a licensing agreement with the university for a sleep apnea pill.

As the search for better treatments continues, listening to patients will be key, said Redline.

“We are actually just treating a very tiny percentage of people effectively,” she said.

https://bit.ly/2LggOPB