Annual MHA Summit Highlights Tech Innovation, Drug Pricing Models

Managed Health Care Associates, Inc (MHA), a leading health care services and software company focused on the alternate site health care provider marketplace, presented its 16^th Annual Business Summit in Las Vegas from March 6 to 8, 2019. This year’s summit also set the stage for a celebration of MHA’s 30th anniversary, which recognized 3 decades helping members manage costs, improve operational efficiencies, and grow their businesses.

The summit featured nationally known speakers who discussed digital innovations, patient- and outcomes-driven payment models, Medicare policy related to post-acute care and prescription drugs, the current legislative climate and disruptive innovation, among other topics affecting alternate site care providers. This article reviews selected sessions that took place during the 3-day summit.

Shantanu (Shan) Bhide, vice president of Technology at SoftWriters, an MHA company, served as moderator for an Industry Partner Technology Track session on advances in eHR/eMar solutions, dispensing methods, trends in packaging system integrations, and enhancements to LTC pharmacy operations and workflows. Digital health innovations and patient care optimization have great potential to advance each other, panelists noted, but providers must be educated.

With so much activity in the market and promises that digital innovations will help providers and patients alike, it is vital to ask critical questions, including whether the innovations are truly a fit for patients’ needs and lifestyles and whether they support smooth workflows.

Crowell and Moring’s Jim Flood, partner and chair of the Government Affairs Group, and Scott Douglas, senior policy director, provided a legislative update. With Democrats in control of the House and Republicans having a majority in the Senate—but not the 60 seats needed to pass legislation, “you have a really good recipe for gridlock in Washington,” Flood said. Still, many committees are introducing health care legislation and holding hearings. MHA has been very active in Washington, DC, tracking these committees and legislation daily, he noted.

Drug pricing remains a top issue that has been on the agenda for years, according to Douglas, with much talk but little action. However, the Trump administration has made drug pricing a priority and is doing what it can through rulemaking to try to manage it—and it will be doing more, he added.

Drug pricing issues on the administration’s agenda include reference pricing, rebate safe harbors, and altering Medicare Part D protected classes. The House is focusing efforts on anti-competitive behavior in the pharma industry, limiting pharma product exclusivity, and Medicare Part D price negotiation, while the Senate agenda includes the CREATES Act—bipartisan legislation that would allow generic companies to sue brand companies for failing to provide drug samples—and changes to the physician fee schedule for Part B drugs.

Legislative efforts affecting pharmacy include bills to kill direct and indirect remuneration fees and the Provider Status bill, which has yet to be reintroduced in the current Congress but has much support. Bills have also been introduced addressing drug price transparency, drug importation, and veterans’ health.

The pair concluded with a brief discussion of the 2020 election and the difficulties posed by a crowded Democratic field, the candidacy of Howard Schultz as an independent, and President Trump’s prospects for reelection.

Jack Hoadley, PhD, research professor emeritus in the Health Policy Institute of the McCourt School of Public Policy at Georgetown University, is a policy expert who served 6 years on the Medicare Payment Advisory Commission (MedPAC). Dr. Hoadley provided a brief overview of Medicare and the IMPACT Act of 2014, which called for studies by the HHS Secretary and MedPAC to design a comprehensive new post-acute care (PAC) payment system covering SNFs, home health providers, inpatient rehab facilities, and LTC acute care hospitals.

The first MedPAC report, released in 2016, evaluated and recommended features for a unified prospective payment system (PPS) across the 4 PAC provider types. Ongoing discussions led to additional recommendations in 2017 regarding an interim approach for establishing the new system, including the implementation of PPS beginning in 2021 with a 3-year transition, and lowering of aggregate payments by 5%, among other recommendations. Further refinements by MedPAC in 2018 proposed additional recommendations involving Medicare payments to PAC providers as well as recommendations regarding SNFs, LTC hospitals, home health providers, and inpatient rehab facilities, he said.

MedPAC recommendations for Medicare Part D suggested transitioning the reinsurance subsidy from 80% to 20%, excluding manufacturers’ discounts that are built into the “donut hole” fix, and making the catastrophic limit a true out-of-pocket cap, Dr. Hoadley said. In addition, MedPAC recommended modifying the low-income subsidy to encourage generic use by beneficiaries and giving plan sponsors more tools to manage drug spending.

Key MedPAC recommendations for Medicare Part B called for creating an inflation benchmark so that the ASP cannot increase by more than inflation and instituting a voluntary drug value program—a buying system in which vendors are able to negotiate Part B drug prices, he said.

Heather Wall, chief commercial officer at Civica, concluded the MHA Business Summit with a talk on disruptive innovation to improve competition and patient care, and how hospital systems are working together to address the generic drug shortage. The impact of this shortage is immense.

Much time, energy, and effort are expended trying to mitigate shortages in the generic space, Wall said. Cost is another problem, with some drugs coming off patent and staying significantly higher than what would be expected or budgeted for.

Moreover, the supply chain for sterile injectables is very fragile due to a number of factors, including expensive facilities and equipment, heavy regulation, capacity constraints, a limited number of pharmaceutical suppliers and lack of redundancy, and manufacturing and quality problems.

Pressures are mounting with about 100 drugs representing a $40 billion market coming off patent over the next 5 years and competing for space on existing lines. In response, hospitals and health systems are looking to jump into manufacturing of certain generics in order to gain control of the supply chain.

These drugs were chosen based on specific selection criteria, including significant price increase, estimated significant hospital spend, presence on the shortage list (current or historic), few vendors with a majority market share, and a drug’s presence on hospital priority lists. The overall goal, Wall said, is to ensure a stable and predictable supply of essential generics, bring competition to certain generic drug market segments, and help allay monopolistic behavior in the generic drug industry.

Civica will accomplish this by having the ANDAs for every generic drug selected for manufacture, partnering with at least two locations or different partners to create redundant capacity, establishing partnerships with multiple vendors to assure an ongoing supply of appropriately priced medications, establishing research and development expertise, and partnering with governmental/regulatory agencies to create new expedient “to market” processes that are compliant and appropriate, among other means.

SOURCE: Managed Health Care Associates, Inc