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Video Transcript: Policy and Providers: New Legislation's Effect on Physician Practices

Webisode transcriptions completed by third-party vendor. AmerisourceBergen Specialty Group assumes no liability for the accuracy of the content.

Gina: Increased patient access to care. Threats of substantial cuts and reimbursement. Government influence on physician technology adoption. How are recent and pending changes in U.S. health policy poised to influence private practice physicians, and what, if anything can they do about it?

Join us to find out, In The Know starts now.

Hello and welcome to “In The Know”, your source for insight and analysis on the issues that matter to specialty health care. I’m your host, Gina Clark.
Today we explore the continually changing world of health policy, legislation, and regulation. This time from the provider’s perspective.

We’ll discuss the immediate and long term effects of health reform on providers, how comparative effectiveness within private payers might impact prescribing decisions, as well as the progress made toward nationwide adoption of tools like e-prescribing and electronic medical records.

With us today is Peyton Howell President of consulting services for AmerisourceBergen and one of the countries foremost experts in public policy and patient access trends. It’s always a pleasure having your with us Peyton.

Peyton: Thank you, Gina.

Gina: So Peyton, starting broadly, what areas of health reform will have the greatest immediate impact? Both positive and negative all specialty care providers like community oncologists.

Peyton: Well the most immediate impact is actually related to those health insurance market reforms. So interestingly enough the immediate impact of health care reform is much more on that commercial side. So the positive news of that particularly when we think about specialty providers and oncology and other specialties are some of the changes that we’re seeing in that space in terms of lifetime maximums, elimination of pre existing conditions, and opportunities to actually expand coverage. Those are all very good news for cancer patients and other patients suffering from chronic diseases. And we’re actually beginning to see changes made on the private side and the employer side ahead of the government’s timetable. So that’s very good news and has immediate impact. Probably the best example would be the rescissions which is when an insurance company actually terminates coverage of someone pending a diagnosis and that obviously is just a dramatic and kind of a horrifying thing to think about. Those have already begun to be stopped by insurers at their own accord, so again ahead of the healthcare legislation mandating those types of changes. So I think that’s immediate, very good news. The negative side are probably for me the law of unintended consequences for healthcare providers, manufacturers in particularly are going to have a number of fees that are already in effect, actually some that went into effect on March 23rd when health reform was passed. Doubling of that, Medicaid rebate, expansion of the 3-40B rebates and then a new industry fee which goes in to effect on January 1st, a whole bunch of fees that are timed well before the expanded coverage which I think is going to create some pressure that could trickle down to healthcare providers and physicians in particular. So that’s one of the areas we’re certainly on the short term looking out for.

Gina: So what about longer term?

Peyton: Longer term is actually pretty interesting probably for both extremes, both good and bad. On the positive side, cause it’s always better to start there is of course 2014. That’s when we can look forward to havening more people having access to some form of coverage. Again, right now we’re not exactly sure what that mix will be between private insurance and Medicaid but we’re hopeful that it’s at least half and half. Because obviously having more privately insured patients would be a huge win for healthcare providers. Medicaid can be a mixed bag depending on the state the healthcare provider is in. So that has some issues to it. But that 2014 deadline is definitely the big good news, but there are a lot of unknowns in the longer term so it’s hard for me to say they’re bad but certainly they have some positive and negative consequences to them and some have opportunities for healthcare providers. A couple examples would be accountable care organizations, or ACOs. We’re just beginning to see the guidelines and information on ACOs come out but an accountable care organization model begins to put a healthcare provider much more in charge of care and certainly for people like you and I, it kind of echoes of managed care and some of the things from our past. So the question is, how is that modernized for today’s reality of healthcare, and who’s in charge. Particularly in chronic disease or cancer care it’s hard to imagine a hospital or primary care physician in charge of those models, it’s certainly not what patients would want. So that’s one that it’s important we’re involved in but it’s far too early to know if it’s kind of good or bad, there’s probably a little bit of both. And that would be a good example. A couple other examples that are longer term that we’re looking at are the independent payment advisory board or the IPAB that is the board; the Medicare board that we believe could actually make cuts and changes to reimbursement in some new and unprecedented ways. We’re worried about that one, again too early to tell. And that one relates closely to the comparative effectiveness research initiative which of course has been renamed also just to keep us all confused. It’s got a patient centered up comes name to it but again comparative effectiveness research, could have some opportunities actually for providers in terms of clarifying, coverage and reimbursement, creating better data from a comparative effectiveness perspective. But right now, a little bit too early to tell exactly what those will be. So those are the longer term, there will be a lot to watch in the future.

Gina: With these new initiatives resulting in expanded health coverage and increased access to care for more Americans how much additional strain might there be on providers. Many of whom already feel overworked and underappreciated.

Peyton:  There is a lot of strain on healthcare providers right now, no doubt about it. Now again, we believe some opportunity is coming particularly with the expansion of insurance coverage. Because we know one of the strains on practices are not just the uninsured but the underinsured. So it’s certainly the hope is that we’re going to have really a leveling out of co pays and coinsurance and that’s one piece of good news we have see come out of that private side that there really are now incentives from the government for private employers to at least hold their benefit steady cause they could be actually penalized if they begin to increase copayments otherwise decline insurance or decline their share of coverage that they pay from compared to free healthcare reform. So that’s at least good news because when we talked to providers today they’re actually very worried by what they’ve seen in terms of that growing out-of-pocket issue which creates a collections issue for them on the backend. So there is some hope there but we definitely need some of these fundamental issues from a Medicare prospective to be addressed and that’s the issue we haven’t fixed. We promised physicians we were going to pay them for their time. And there’s been no change in terms of care management actually paying offices for those purposes and right now physicians are still incentive on a volume basis versus having any kind of incentive related to longer term out comes or quality and so there’s a lot of work to do here that I think is going to take more of a five to ten year horizon for physicians.

Gina: One could contend that Washington is disconnected from the reality of community physician practices, can you share what AmerisourceBergen is doing on these issues in Washington and any suggestions on how others can become involved?

Peyton: I’m really proud of the work that AmerisourceBergen is doing in Washington D.C. and I think for us as a large pharmaceutical distributer and service organization we get to have a unique view of all of our customers. All types of physicians, all types of specialties as well, health systems and other providers. And so we can be a voice for physicians in particular, I think if the reality of that strain, I think it’s very hard for folks in Washington to get a handle on the reality of all these different reimbursement issues are particularly when you think about it, independent practices out in the not only rural communities but even in the suburban communities where they don’t have some of those large academic medical center type of resource at hand. And so we have been a strong voice in supporting that and really just sharing the facts of what we’re able to observe from our customers perspective. We actually have a Washington D.C. office. We’re the only distributer that actually has a Washington D.C. office. It’s lead by Rita Norton. Thirty plus years of experience in D.C. and all of our associates are actually now very active as well in terms of engaging on these issues and sharing the issues that we see firsthand that impact patient’s lives. But there’s a lot that everyone can do. It’s very important that practices do reach out to individual centers and Congressmen. I have seen firsthand the impact that can make. We can go in with a broad message but when it’s followed up, whether it’s a quick phone call, or a note, or an email, into your local constituent base that makes a big difference to the members of Congress. They listen when they really do hear from you and of course practices are so busy to add on one more thing, it’s very, very difficult. But that five minutes that it takes just to even send an email and to really talk about some of those specific reimbursement issues and that there really is an issue I think is very important. Particularly right now, while we work to have some of these issues fixed, not just STR but some of the more fundamental issues associated with ASP reimbursement and physician care management reimbursement.

Gina: Wellpoint recently became the first benefits company to release guidelines for its plans to use of comparative effectiveness research in reviewing drugs for its formulary. In an earlier Webisode we talked about how comparative effectiveness might affect other manufacturers, what about the provider market in terms of drugs prescribed or administered in office?

Peyton: It’s going to be interesting to see the impact of this. I had an opportunity right after that Wellpoint announcement to ask other payers and they basically indicated at our manage care network meeting that they’re going to follow suit. That their plan was to make that type of information public versus keeping it a proprietary resource but share that information so that healthcare providers do have information in terms of what data they’re using, why they might be covering one therapy and not another or why they might be requiring step therapy or prior authorization meaning use of one therapy first before you can actually get coverage for a second therapy. So that transparency I think is a really positive advance I think it will help health care providers. This week Med Pack actually went one step further, Med pack is the group that advises Congress on healthcare issues and they said there’s really a need to have a shared value discussion for healthcare providers so that patients can be part of that discussion as well and I thought that was a really thoughtful observation and recommendation in the report and again, a longer term thing to get to but have patients be part of the discussion so they don’t feel like they’re not being given a choice but they can understand what factors might make one therapy a better option for them versus another based upon the best data we have available today. Again a lot of this is I think going to be further out than today. Maybe more of a five-year view but an important step I think in terms of putting that information in the hands of physicians but also patients.

Gina: Are there any recent updates or changes related to REMS guidance from the FDA?

Peyton: REMS has been on the news again actually this week so REMS of course are the risk evaluation mitigation strategies that the FDA is requiring on a number of products and they announced for the end of July two important meetings that really anyone concerned about this issue should think about at least monitoring or potentially even providing comments to. First is a meeting that will be specific to the classified REMS for opioids, now that’s an interesting one because a class wide REMS means all the products have to follow one guideline and that kind of standardization is actually very helpful to healthcare providers, the good news. The bad news of course is will that REMS be sensitive to the very different issues that exist for opioids, particularly for like cancer patients or the patients suffering from chronic pain. Because there’s not a real risk of the same kind s of fears you have when you’re talking about someone who is suffering from cancer, that’s one concern there. The other REMS meeting is actually much more general and they’re looking for kind of broader guidance and I think what this means is that we’re getting heard actually in Washington on this issue. That REMS are increasing costs that they’re putting burdens on healthcare practices down to the specific position. That really are potentially unnecessary and the FDA is looking on more guidance on REMS. So by the time we get into August there will be two opportunities for practices, providers, pharma companies and others to weigh in and we’ll be part of that as well.

Gina: So the U.S. government has taken an active role in encouraging technology adoption in physician practices, with the Medicare e-prescribing incentive through 2013. This incentive overlaps with penalties for practices who don’t e-prescribe beginning in 2012. Have these incentives spurn on technology adoption as much as the government had hoped, or not?

Peyton: Tough to know if it’s as much as the government had hoped because they are very wise in not putting any expectations out there. It’s made a difference in terms of the discussion and we have certainly seen practices moving toward e-prescribing. But it’s also hard to get the benefit of e-prescribing unless you can also afford the full EMR EHR strategy. That’s obviously much more difficult than just e-prescribing alone. But we’ve been urging practices to start looking at e-prescribing. A 2% bonus is very significant for a practice. 2% on all your Medicare can be 50,000 dollars for an average practice. So it’s material and certainly a good step into e-prescribing so we’ve been very supportive of it overall. Probably isn’t exactly what all of us hoped at this point given all given how close we are to the sticks that are coming on this issue and I think that creates some urgency in terms of looking at all the technologies a practice really should have available to them.

Gina: So what barriers continue to stand in the way of technology adoption, particularly for those smaller practices, and what policy driven accommodation policies are being made in recognition of those barriers?

Peyton: Well you know, that may be the opportunity in some policy initiatives that helps to standardize and help inform practices. There are so many options right now, not just for e-prescribing but for electronic health records. I think it’s perplexing for your average small practice and you know, we obviously believe in that small physician practice. We know that’s where healthcare is done, where we all are served on a day-to-day basis to a very large extent. But those practices need help with understand what tools make sense and the bevy of options right now I think, are very challenging. I think the government created more resources in terms of sum besting class perhaps addition funding to support some specific technologies. They might be able to help fuel this further and more quickly and I think the government has incentive to do that. So hopefully they’ll look at that. The reason they probably haven’t at this point is the budget, the budget is this ongoing crisis that, you know, creating a pull for some of the things we know long term would save money but from a CBO, congressional budget office’s perspective investment and technology are not considered as cost savers they are considered as costs at this juncture and that’s a real challenge.

Gina: Peyton, can you give us an overview of the current state of 340B as it relates to oncology practices and what potential changes can we watch for?

Peyton: 340B has been a big buzz word so the once sentence version of what 340B is 340B was a created to support indigent patients in the outpatient setting and manufacturers provided kind of 'best price' type pricing, to over simplify the term, to institutions that qualify and to qualify you had to serve a certain number of indigent patients. But what we’ve found is that it’s actually being utilized for the entire practice. So that's different than what the intent is but consistent with the law currently. So that's created a challenge where there's a short-term incentive I think for practices or at least hospitals and other 340B entities to look to grow right now and take advantage of that. But I'm skeptical as to whether or not this will continue. 340B has grown well beyond what anyone expected. I think it's now become fairly wide known that it’s being abused. So I think we’re going to see this re examined in fact we’ve seen some teasers toward that just in the past couple of weeks. There was a proposed 340B inpatient program that was very different in how it was described. It was very limited in terms of only being utilized for eligibility entities just for that indigent patient and if you think of a posed healthcare reform environment that’s a very small number of patients that would actually qualify. I’m actually one who thinks we’ll probably see some changes in that in the future just because of the scale of 340B. But it will be an important one to watch, very important to practitioners and I’m just of the mindset of utilizing a short-term type policy to your advantage can be dangerous. So anyone considering that should be very careful.

Gina: What opportunities exist for practices given all these changes in reimbursement and coverage?

Peyton: I know it can feel kind of gloomy right now, especially as we wait for these uninsured patients. But there still are opportunities for practices. One opportunity is mid level providers. Many practices are expanding their use of PAs, nurse practitioners as a way to be more cost effective in delivering care, take some of that strain off of that base and really maximize what they do in the practice everyday. Ancillary remain an opportunity, they vary by specialty in terms of what really is cost effective and necessary but certainly it’s specific to your practice. I think it’s important to make sure you’re really maximizing those opportunities and those could be very local depending upon what would be most convenient for you to offer in your practice for your patient giving your local access. Third, in office dispensing really has turned into an important opportunity in practices particularly oncology. So if you know you’re working with a number of oral or self administered inject able products that can be a real convenience for patients to be able to have that part of their care in the office setting and have that dispense there especially for Medicare patients where part D can utilize any pharmacy. There are some real advantages to having that all be one trip and not require a senior to make an additional trip back and forth to the pharmacy and back and forth to the physician. So those are all things to look at, there are still a few opportunities that it’s really important right now for practices to be looking at revenue optimization and also all of their expense management.

Gina: Great information as always Peyton. Thank you so much for being with us to share your insight.

Peyton: Thanks for having me.

Gina: And thank you for joining us. We’ll be back soon with another all new Webisode. Until then, if it’s on your mind, it’s In The Know.

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