Out of Pocket Costs Experience Modest Rise

The total amount of money spent per patient per physician visit increased by 3.5 percent over the last year, according to a new study from the Robert Wood Johnson Foundation. Deductibles for every type of physician visit also increased across the board. The report included data from 15,000 physicians, and found that primary care physicians saw slightly higher reimbursement rate increases when compared to other doctors. The study indicates that reimbursements for specialty care dropped substantially in 2014.

Slavitt Nominated as CMS Administrator

President Obama has nominated Andy Slavitt to the permanent position of Administrator of the Centers for Medicare and Medicaid Services (CMS). Slavitt has been serving as the acting administrator since January, when Marilyn Tavenner resigned from the position. Before joining CMS last year as principal deputy administrator, Slavitt worked in the private sector, most recently as an executive at Optum, a health care technology firm that was partially responsible for the launch of HealthCare.gov. His involvement in the difficult launch of the website has caused some legislators, including members of the Senate Finance Committee which will hold his confirmation hearing, to raise concerns about his nomination.

GAO Releases Report on 340B Drugs

The Government Accountability Office (GAO) has released a report on the Medicare program designed to offset drug costs at hospitals serving the poor, finding that the 340B drug program is incentivizing doctors to overprescribe drugs to their patients. The 340B program requires drug manufacturers to discount outpatient drugs dispensed at disproportionate share hospitals (DSH), while Medicare Part B payments to these hospitals remain the same regardless of whether a drug is discounted. GAO’s report indicates that hospitals participating in the 340B Drug Pricing Program are either prescribing more drugs or more expensive drugs to their patients compared to hospitals that don’t qualify for the program. 340B hospitals spend nearly 2.5 times more than hospitals outside the program, $144 per beneficiary as compared to $60 per beneficiary. The report notes that these differences cannot alone be explained by differences in the health status of the patient populations. GAO notes that unnecessary spending has negative implications for the Medicare program as well as for beneficiaries, who may be liable for higher copayments resulting from more drugs or more expensive drugs. The GAO also outlines concerns about the health implications of potentially inappropriate care. The report urges Congress to take actions to change 340B program incentives, an action which is outside the power of the Centers for Medicare and Medicaid Services (CMS) and the Health Resources and Services Administration (HRSA).

Energy and Commerce Members Criticize FDA Opioid Policies

Bipartisan leaders of the House Energy and Commerce Committee have written to Dr. Stephen Ostroff, Acting Commissioner of the Food and Drug Administration (FDA), posing questions regarding the agency’s efforts to combat the opioid abuse epidemic. Chairman Fred Upton (R-Mich.), Ranking Member Frank Pallone, Jr. (D-N.J.), Oversight and Investigations Subcommittee Chairman Tim Murphy (R-Pa.) and Ranking Member Diana DeGette (D-Colo.) press Dr. Ostroff to explain why immediate-release opioid labels are not required to include the same warnings regarding potential abuse as long-acting versions of the same painkillers. “Experts have raised concerns with staff about the basis and effectiveness of…FDA labeling and risk-management strategies, and a recent review on opioid use for chronic pain by the Agency for Healthcare Research and Quality (AHRQ) found no evidence that risk mitigation strategies were effective,” the letter says. This letter follows a letter to the FDA signed by Democrats only posing the same concerns.

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