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Friday, February 12, 2016

Drug Shortages in the U.S. and What We Can Do About It

Critical shortages of prescription medication in the United States (and globally)
The United States has chronic shortages of certain medicines, especially those used in critical care and surgical treatments. Recently, both the New York Times and the Wall Street Journal published articles on medication shortages. This analysis looks at current drug shortages, whether there are substitutions, the reasons for this phenomena, and what we could do about it. To help you understand the reasons for shortages in medications, I reviewed detailed information from the American Society of Health System Pharmacists, which tracks medications and posts an almost live-time report on drug shortages on its web site.[1] This chart shows several categories of drugs, both preventive and interventional medications which are in short supply as of February 2016.


Drug Shortages as of February 2016
Drug Type
Ampicillin injectable
Aminocaproic Acid Injectable
DtapIPVHib Vaccine




Purpose
Surgical antibiotic for critical care
Hemorrhage prevention during surgery
Childhood disease prevention
Manufacturer
Fresenius, Sargent, Santos
American Regent, Hospira
Sanofi Pasteur
Length of Shortage
1 to 2 months
Unspecified
In short supply since mid-January
Reason for Shortage
Increased demand
American Regent is no longer making it; Hospira indicated manufacturing issues
Manufacturing delay
Availability of Substitute
Yes, Unysn
None listed
Yes, Pentacel




Source: American Society of Health-System Pharmacists


The venerable Cleveland Clinic has a sterile room and the ability to compound its own drugs in a pinch, but this is certainly not the case with most hospitals.[2] Anesthesiologists must determine how to ration some drugs used in surgeries and hospitals should have a policy for determining this process. Still, much of it is in the dark, because when you consent to a hospital procedure, it is giving broad consent for the surgical team and the facility to make decisions for you while you are incapacitated in the procedure. This in and of itself isn’t bad, as it is a basic tenant of medical triage, and this is what the medical team is trained for. However, as a society, can we be doing more to assure adequacy of necessary medications and even preventive care immunizations?
 Mark Baum, CEO of Imprimis Pharmaceuticals, has some interesting observations, expressed in the January 26th Wall Street Journal Op Ed article.[3] His tenant is that federal regulatory policies interfere with free market competition for drugs and he has some interesting ideas to provide more of a supply of medicines and to lower the cost to the health system. He has several suggestions to improve the marketplace for less expensive drugs including:
1.       Allowing compounded-drug makers, which are companies who make the off-patent generic drugs, to create new formulations of expired patents for medicines and make them available at drastically reduced costs. This practice was not allowed until November 2013, when the Drug Quality and Security Act was passed.
2.       At present, Medicare or the Centers for Medicare and Medicaid (CMS), which is the largest drug purchaser in the nation, does not pay for compounded drugs, which means it is paying only for brand names, when a far less expensive substitute may be available. His example, Medicare will pay $750 for the Daraprim made by Turing Pharmaceutical, but not for the 99 cent generic alternative. I can just hear the swoop of lobbyists rushing for the beltway to scare Congress out of this good idea.
3.       Medicare also pays doctors a percentage of the cost of the drugs they prescribe, so there is no incentive for clinicians to prescribe the lower cost medications. This is especially true now when doctors are required to complete so much paperwork and receive so little in the way of reimbursement for primary healthcare.

 Since pharmaceutical manufacturers are privately held companies, often of a global nature, their entry into drug markets is controlled by the FDA, but their exit from the supply chain-not as much. Though the U.S. government is still one of the largest investors in healthcare research, through the department of Health & Human Services, product approval is regulated, but in general the drug companies use market pricing for their products. This means, if they have a monopoly, they can charge a lot more, which is what Valeant and Turing did, as detailed in a previous article.[4] Though Mr. Baum brings some good ideas to the fold, I don’t have quite as much confidence in the efficacy of the private sector marketplace as he does. Americans already pay more for their cardiac devices[5], orthopedic devices[6], and other medical gear than other nations, because these companies gouge the U.S. health system for the sake of their profits.  However, I am all for making the ninety-nine-cent pill available, as an alternative to the opportunistic price gouging of companies like Valeant and Turing. And finally, let’s stop blaming the physicians for everything, they are merely actors in a health system that rewards many of the wrong things and slights those that could make a difference. We need to focus on systemic changes and Congress should also pay the promised fee increase to physicians for primary care, which the Republicans refused under the budget sequestration process. Sequestration means the act of confiscating something or forcibly taking possession. It is unconscionable that physicians and health systems are encouraged by law, to provide health services, based on a certain rate of reimbursement and then jerked around by Congress in some power play.

And this is the healthpolicymaven signing off and encouraging you to share this article virally.
The healthpolicymaven is a trademark of Roberta E. Winter and Praevalere Inc. Ms. Winter is a healthcare writer and analyst and author of Unraveling U.S. Healthcare-A Personal Guide. http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

This article in no way provides medical advice.

Thursday, January 28, 2016

Top 10 Things From The Affordable Care Act You Don't Want To Lose



As the election year gyrates along and the Republican contingent are myopic in their campaign to terminate the Affordable Care Act and the accompanying Health Care Education and Reconciliation Act, here are some facts about the landmark law which have helped healthcare consumers and healthcare facilities. This top ten list is in order of importance, based on an improved ability of the individual to access health treatment when needed:
1.      Outlawed the medieval  insurance company pre-existing condition clause which prevented people from obtaining health insurance and thus treatment, because of a medical condition
2.      Employer provided insurance contracts are no longer allowed to restrict essential benefits, such as the odious limits for organ transplants or fixed dollar amounts for maternity
3.      Tax subsidies from the Federal Supplementary Medical Insurance Trust Fund which enable people who don’t have employer provided health insurance to be able to buy medical insurance (thank you)
4.      Requiring insurance companies which participate in the exchanges to spend 80% of annual premium contributions  to pay for actual medical services, otherwise the exchange participants receive a refund of unused premium payments[1]
5.      Paying for performance with the Accountable Care Organization Shared Savings Program; a program administered by the Centers for Medicare and Medicaid (CMS), which is in its 5th year and has 333 participating health organizations, paid $422,000,000 in performance bonuses to 97 organizations which met quality of care benchmarks and saved CMS money[2]
6.      Removal of the Medicare Prescription drug gap, called the donut hole, which made it more difficult for seniors to afford their medications
7.      Creation of insurance exchanges, which provide health insurance purchasers a one-stop-shop web site for medical insurance; sure there have been some hiccups, but the program is working and just completed its third annual enrollment; states had the option of creating their own exchange or letting the federal exchange do the work
8.      Taxes on medical device companies to help fund the Federal Supplementary Medical Insurance Trust-that 3% doesn’t impact the viability of these companies and they won’t refund the money if the tax is repealed; everyone has to contribute
9.      Pay or Play rules-Yes, if you are an employer in this industrialized country you are expected to provide medical coverage for your work force, but if you opt not to do this, you will pay a tax which goes into the Federal Supplementary Medical Insurance Trust Fund, to help those valuable workers obtain their own insurance and your government provides tax subsidies for you to do this (thank you)
10.  Individual insurance mandate requiring residents to show proof of medical coverage or pay a tax penalty; as previously reviewed in this column, there are so many loop holes to this requirement including; religious exemptions and economic hardship, that complainers have probably not read the law, so here are the articles one more time for your convenience.[3]




     Though the Affordable Care Act is not perfect, few laws when initially enacted are. The Small Business Exchanges have been problematic and there is still a real patchwork of states which expanded Medicaid coverage, but this is a reality for many government funded programs which are administered by the states. This reflects the messy process of democracy. As to the hue and cry about socialism, I wonder how many of those Congressman are willing to give up their Cadillac healthcare coverage or their federal pensions? As for the military personnel who don’t want to pay taxes, yet receive government provided medical care, subsidized living expenses, education, and a pension, who should pay for this? And let’s give a shout out to those seniors who are receiving Medicare and Social Security, yet don’t want to pay taxes for “socialism.” We all have to pay our share and some people pay more than their fair share, these programs have to be funded and your entitlement is not greater than others. As a nation we could use some tax reform and definitely elimination of the Super Pac privileges to restore democracy back to the citizens. As for me, my government has been the most reliable partner I have had, providing Social Security income for my son when we lost his Dad, unemployment income through my periods of joblessness, federal loans and grants so that I, a farmer’s daughter could get a university education, and tax subsidies for my family to obtain medical insurance. God Bless America, but please don’t BS about not wanting your socialized benefits.

And this is the healthpolicymaven signing off, feel free to share this article virally.

Tuesday, December 1, 2015

Understanding Your Accountability under the Affordable Care Act-Medical Insurance Mandate


Today, I achieved my 3,000th mile of the year and am rounding the corner on 2015. Year end is a time to clean out the closets and make financial decisions, which includes your medical insurance review. This article clarifies the individual insurance mandate tax assessment under the Affordable Care Act and the exemptions to avoid taxation.
The Patient Protection and Affordable Care Act was passed by Congress in 2010, creating a standard for medical insurance for most residents of the U.S. and requiring all to obtain medical insurance. As of 2015, individuals who lack proof of medical insurance, will have to pay an additional tax. The tax penalty is up to $695 for those individual tax payers lacking insurance and up to 2.5% of adjusted gross income, capped at $2,085 for a family ($347.50 per child).[1] FYI, your insurance company will produce a form which shows the number of months you had medical insurance coverage. If you obtained your medical insurance through an insurance exchange, the form will also show the tax credits which were advanced from the government to pay for the premiums, which will affect your overall tax filing. In other words, your tax credits reduce the amount of a refund you may receive or conversely, may require you to pay some money back to the government if too much money was advanced to cover your insurance premiums.
Exemptions to the Individual Insurance Mandate
Like any other law which Congress creates, there are exemptions and here is a summary of the exceptions to the individual insurance mandate under the Affordable Care Act.
Hardship Exemptions
The hardship waiver is based on four main standards; your residency status, your financial situation, the cost of insurance relative to your income, and religious exemptions. Here are the eligible exemption criteria as drawn from the healthcare.gov web site. [2]
Cost of the Medical Insurance is Unaffordable
8% Rule for Insurance Exchange Plans
If the lowest price insurance available to you would cost more than 8% of your household income (generally based on the adjusted gross income figure on your income tax return) no penalty will be assessed for lack of medical insurance. If the individual medical insurance policy was cancelled and you have found marketplace plans to be unaffordable you will also not be penalized for lack of medical insurance.
Household Income
Residents whose Annual Earned Income is below $6,300 are not required to file a tax return.[3] In this case it would be difficult for the government to audit compliance with the medical insurance mandate, but these individuals are probably covered on Medicaid or Medicare anyway.
Family Hardship Situations
Of small comfort, homeless residents will not be taxed for lack of medical insurance, but this begs the question, do homeless people file income tax returns? Nor will those facing eviction or who have been evicted from their home be penalized for lack of health insurance. Receiving a utility shut off notice also creates an exempt classification, which leaves the door open for gaming of the system. Bankruptcy filed within the last six months is an exempt category. Losses due to a natural disaster such as flood, fire, or other disaster also mitigate the need to obtain medical insurance. Unexpected medical expenses for the care of a disabled, elderly, or ill family member are also an exempt class. Those supporting a child for whom another person has been court ordered to provide medical support, are eligible for an exemption from the tax penalty.  The recent death of a family member also creates a tax penalty waiver for lack of medical insurance. Domestic violence events also create an exemption and to these victims, please note free health care is available at trauma centers.
Other Exemptions
Hardship in obtaining health insurance, such as having your policy cancelled creates an exemption to the A.C.A. insurance mandate tax. No penalty will be assessed for any eligible individual if the period of without insurance was for less than three months of the year.
Religious Exemptions
Members of a health care sharing ministry, which are 501-C 3 plans, are exempt from compliance with the medical insurance mandate under the Affordable Care Act. Additionally, those who are members of a recognized religious sect which objects to insurance, including Social Security and Medicare are exempt.[4]
Residency Status
Unlawful immigrants are precluded from insurance exchange participation and enrollment in other federal health programs. Sadly, this provision includes pregnant women and children. Incarceration gives you an exemption, because you are a ward of the state. Finally, if you reside in a state which did not expand its Medicare program to meet the 138% of the federal poverty level for enrollment under the Affordable Care Act and you are in that income category, you are exempt from the tax penalty if you are unable to squeeze the insurance premiums from your tight budget.

Teeth gnashing aside, as observed there are enough loopholes in the individual insurance mandate to drive a truck through. For more information on the religious exemption, please follow the link to the article I published on it in 2014. To calculate your tax penalty, use a free online tax preparation program and make your life easier. Also, the government site, healthcare.gov has a great interactive worksheet to figure out if you may owe an insurance tax. And this is the healthpolicymaven wishing you a happy and safe holiday season for Chanukah, Christmas, Solstice Festival, or whatever your end-of-year ritual may be.

Feel free to share this article voraciously, with appropriate attribution of course. This article was written by Roberta E. Winter, a freelance writer and healthcare analyst and author of Unraveling U.S. Healthcare-A Personal Guide. http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

Sources for more information