Category: Blog

Financing long-term services and supports (LTSS) presents a
concern to older adults, lawmakers, and society at large. LTSS refers to those
services that meet a person’s routine health and personal care needs when he no
longer can perform these tasks on his own, often due to age or disability.
Affording LTSS is a challenge, as few people have the necessary financial
resources to meet its high costs, and many must eventually turn to Medicaid for
help. Medicaid is the largest payer of LTSS, covering 43 percent of national
LTSS spending in 2013 (Nguyen). Concerns arose over the
sustainability of Medicaid’s role in financing LTSS in anticipation of an aging
baby boomer population that will need LTSS. One solution intended to ameliorate
LTSS financing is the Medicaid Estate Recovery Program (MERP), which requires
states to recover payments from individual estates for long-term care services (Estate Recovery). However,
this program which is characterized by Rachel Corbett as “Medicaid’s Dark Secret,”
tends to bring more distress than actual revenue.

MERP intends to control LTSS costs by providing a way for
states to recoup the money spent on a recipient’s care. Since the beginning of
the Medicaid program in 1965, states have had the option to recover from the
estates of deceased beneficiaries over age 65 when they received benefits (MACPAC).            However, the highly billed savings
of estate recovery have yet to materialize.

In 2005, the AARP Public Policy Institute published a study analyzing the first decade of
mandatory estate recovery. The study found that Massachusetts collected an
average of $16,442 per estate in 2003; offsetting a little more than one
percent of its LTSS costs in total. That one percent made its efforts among the
most effective in the nation. In contrast, the average amount recovered from an
estate in Kentucky was $93, representing just 0.25 percent of its LTSS costs.
The total amount states recovered increased from $72 million in 1996 to $347
million in 2003. Nonetheless, estate recoveries accounted for less than one
percent of Medicaid’s total nursing home costs in 2003. Corbett notes that the
“overwhelming majority” of estates recovered under MERP are not worth the
hundreds of thousands of dollars needed to make an impact on Medicaid LTSS
spending.

MERP,
thus, seems more punitive than economical. As described above, the average
amount recovered from an estate is far from the amount needed to reimburse the
billions of dollars spent on LTSS. Financing LTSS presents one of the greatest
challenges our healthcare system will face in the upcoming years. While
Medicaid has met this need for now, its role as the primary LTSS payer is
unsustainable. MERP was billed as a solution to manage the strain LTSS puts on
state and federal budgets, but the program, with its slim returns and human
cost, is not the answer. A few states have already responded to these concerns
by scaling back their estate recovery programs (Corbett). More state lawmakers should
consider following their lead.

Before
parties reached a $260 million settlement, litigation was set to
begin this month to determine whether drug companies are responsible for the
opioid crisis that reached Cuyahoga County and Summit County of Ohio. The
lawsuits brought by these Ohio counties are just two of the over 2,000 pending
lawsuits in response to the opioid crisis. Since 1999, the opioid crisis has resulted
in over 200,000 overdose deaths in
the United States. The
Court consolidated pending opioid-related lawsuits into what is now referred to
as the National Prescription
Opiate Litigation.

The bellwether trial which focuses on the two Ohio
county lawsuits was intended to try a widely contested issue and typically is representative
of the other cases. This trial would likely shape how courts conduct those other
pending opioid-related cases.

Before
pharmaceutical companies began marketing opioid treatments for a wider range of
uses, opioid medication was only prescribed in cases of extreme need.  In the late 1990s, the pills
started being prescribed at higher rates and their highly addictive
nature soon showed. The Drug Enforcement Agency’s Automation of Reports and
Consolidated Orders System (ARCOS) nationwide analysis illustrates the magnitude of the
prescription pain pills supplied to states and counties. For example, one West
Virginia county was supplied with 38,269,630 pills, or enough prescription pain
pills to provide each person 203 pills annually between 2006 and 2012.

Lawsuits
against drug companies accuse drug manufacturers of marketing their opioid
treatments in a way that failed to adequately disclose the risk of addiction
and overdose. In the suit that just settled, the Ohio Counties accused defendant distributors
of failing to properly  “detect, probe or report suspicious
orders.”
Defendants denied these allegations and asserted that they
complied with federal regulations to provide medicine to people suffering from
painful conditions, that doctors who over-prescribed the opioids are to blame,
and that the DEA had the information necessary to stop the opioid pills
from entering the black market.

Litigation
did not occur as planned for the Ohio county case because on the morning of the
trial start date, drug maker Teva Pharmaceuticals and drug distributors
McKesson, Cardinal Health, and AmerisourceBergen agreed to a $260 million settlement. Other parties to a similar
settlement included companies such as Johnson & Johnson, Mallinckrodt, and
Endo International and Allergan. Johnson & Johnson reached a $20.4 million
settlement, Mallinckrodt reached a $30 million settlement, and Endo
International reached a $10 million settlement with up to an additional $1 million
worth of medications provided to the counties. Despite settling, none of the
listed defendants admitted liability.

As of
late October, Walgreens has not settled and will likely
go to trial within the next six months. It argues that it is different
from the defendants who already settled because it merely fills prescriptions
and never manufactured, promoted, or prescribed any opioid medications.

Today,
the Centers for Disease Control and Prevention estimates that the opioid crisis
has a $78.5 billion economic burden annually
across the United States alone. The goal of this Ohio case was to provide funding for what is
expected to be a decades-long recovery process. There is already discussion regarding the
distribution of the settlement money. While reaching settlements with these Ohio counties avoided litigating
this trial, the settlements do not resolve the other 2,000 pending cases.

The issue of suicide as a felony has resurfaced. This time, however, the discussion isn’t centered around physician-assisted suicide. Instead, the focus is the criminality of attempted suicide. In February 2019, a 56-year-old man in Maryland plead guilty to a count of “attempted suicide” and was sentenced to a three-year suspended jail sentence, and two years of probation (Washington Post, 2019). Oddly enough, this is only one of ten attempted suicides that have been prosecuted in Maryland in the past five years (Washington Post, 2019).   

Suicide as a
criminal offense dates back to 13^th-century English common law,
where suicide was considered a crime against “God and the King” (Washington
Post, 2019). Early common law held suicide as punishable by ignominious burial
on the highway, and by forfeiture of goods and chattels (Markson, 1969). This
common law rule was initiated after America declared its Independence from Britain
in 1776. However, many states eliminated the common law by total reliance on
statutory law, whereby suicide was ignored and the common law against suicide
was made ineffective (Wright, 1975). Still, several states maintained the
common law principle that suicide was, in fact, a crime (Wright, 1975).

State courts continued
to be confronted with this issue, and faced with the question of how suicide
should be dealt with in the law. Many states have refrained from
decriminalization based on the opinion that criminalization will deter suicide
attempts, or at least provide grounds for involuntary hospitalization or
treatment.

This debate has
spanned from 13^th-century common law all the way to 2019, where Del.
David Moon (D-Montgomery) recently passed a bill to decriminalize the act in
Maryland (Washington Post, 2019). Moon highlighted that one of the reasons
prosecutors still resort to using this dated law is to get people into
involuntary hospitalization and treatment. His bill received criticism from
lawmakers who feared this would garner support to legalizing physician-assisted
suicide; however, suicide prevention groups vocalized their support, noting it
may help shift the discourse to prevention and de-stigmatization rather than
punishment. After much debate, Moon’s bill decriminalizing attempted suicide in
Maryland was passed in April, 2019. This ruling may re-ignite conversations in
states like Virginia, where attempts to decriminalize attempted suicide have
failed.

This discussion
goes beyond the specific issue of decriminalization of suicide attempts, and
raises important questions about how the justice system should deal with mental
illness. Moon notes that “if we keep enabling the law enforcement function to
take over the public health function, we are never going to fix [these mental
health issues]” (Washington Post, 2019). Suicide is currently the 10^th
leading cause of death in the United States, and is continuously on the rise
(National Institute for Mental Health, 2019). Is the best way to combat this
public health issue to criminalize the act? While it is undisputed that suicide
prevention and deterrence is of the utmost importance, it is questionable how
continued criminalization of attempt will achieve this. If anything, it may
incentivize attempters to use more lethal means to ensure they do not survive
and be faced with criminal charges. Even more, this may actually prevent people
with suicidal ideation from getting help on their own volition for fear of
criminal repercussions. As we become more aware of mental illness as a public
health concern, it is important to explore even the most well-meaning efforts
for prevention under a critical eye, and assess the consequences of dealing
with mental illness through the criminal justice system.

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Source: https://www.washingtonpost.com/local/md-politics/attempted-suicide-can-be-prosecuted-in-maryland-del-moon-wants-to-change-that/2019/02/04/1c040148-24d7-11e9-ad53-824486280311_story.html

 

This year has been another significant year for
consolidation within the biopharmaceutical industry. There has been an
estimated $208
billion in transactions ; including Bristol-Myers’ $74 billion acquisition
of Celgene in January
to AbbVie’s $63 billion acquisition of Allergan in June which allows large
biopharmaceutical companies to dominate the broader deal landscape in the
industry. There are emerging signs, however, that the government is beginning
to take a closer look at biopharmaceutical consolidation, pushing for
divestments or potentially blocking the deals in court.

Signs of greater regulatory scrutiny have been most evident
within the pending acquisition by Roche of Spark Therapeutics. Roche entered
into an agreement to purchase Spark Therapeutics in February
for $4.8 billion. Spark Therapeutics currently markets the only FDA approved
gene therapy, Luxturna, which is used to treat certain retinal eye diseases.
Roche is hoping to take advantage of other gene therapy treatments developed by
Spark, particularly their hemophilia A research which Roche believes will complements
their own hemophilia treatment, Hemlibra. Despite being a relatively small
transaction in terms of size, both the Federal Trade Commission (FTC) and the
Competition and Markets Authority (CMA) in the United Kingdom have taken note
of the transaction, with the CMA filing an ‘Initial
Enforcement Order’ to temporally block the transaction from being
completed. Just this past week, Roche extended
the deadline for shareholders of Spark Therapeutics to tender their shares to
approve Roche’s acquisition, the seventh time that Roche has pushed back the
tender offer deadline for Spark Therapeutics.

There is little official mention of what concerns the FTC
and the CMA have with Roche’s acquisition of Spark Therapeutics, but some analysts
point to the potential overlap between the two companies’ hemophilia business
and may push Roche to divest Hemlibra to obtain approval for the Spark
Therapeutics acquisition. Some feel this is an unusual step for the FTC to request,
particularly in light of the robust existing market for hemophilia products.
Analysts, however, point to the consent degree between Bristol-Myers and the
FTC that permit their acquisition of Celgene if Bristol-Myers chose to divest
rights to Otezla,
a drug to treat psoriasis, to Amgen for $13.4 billion. Otezla was considered
one of Celgene’s most profitable products, expected to generate $2.3 billion in
annual sales
by 2023. Given that Amgen already has a strong psoriasis pipeline, including
Enbrel and Amgevita, a biosimilar to AbbVie’s Humira, some were confused
as to why the FTC permitted Amgen to acquire Otezla.

AbbVie’s pending acquisition of Allergan did not raise the
degree of early scrutiny that the Bristol-Myers-Celgene transaction did, but
this trend is starting to move. In September, the FTC sent an additional ‘Request
for Additional Information’ letter to AbbVie, delaying the completion of
the transaction at least an additional thirty days. AbbVie has kept with the
early-2020 date as when the transaction will be finalized. A number of consumer
advocacy groups have requested
the FTC intervene in the pending transaction. They point specifically to
AbbVie’s manufacturing of Humira, which continues to be the best-selling
drug in the world. Humira continues to invite scrutiny due to its high price,
set at $58,612 in 2017. Allergan also markets Botox, primarily used for
cosmetic purposes. These advocacy groups are concerned that another large
biopharmaceutical tie-up will raise the prices of a greater drug portfolio,
particularly in light of Humira’s expiring patent
in 2023.

Increased biopharmaceutical consolidation continues to raise
concern among Congress. Last month, Sen. Amy Klobuchar (D-MN) and eight
senators sent a letter
to FTC Commissioner Joseph Simons requesting the FTC take greater scrutiny of
these transactions and ensure that any anti-competitive activities are
remedied. Sen. Klobuchar, along with Sens. Cory Booker (D-NJ), Kamala Harris
(D-CA), Elizabeth Warren (D-MA) and Bernie Sanders (I-VT)[sk1] 
are all competing to be the 2020 Democratic presidential nominee. Given the continued
focus on the price of prescription drugs, both in Congress
and by President
Trump, the FTC may push for larger divestments and more aggressive consent
decrees to limit future price increases among acquired companies.

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Over
the past year, mergers and acquisitions across industries are seeing a spike
while appropriations to the antitrust division of the Department of Justice
have remained the same. Included in this most
recent spate of mergers are hospital systems. Hospitals are merging at record
rates and PricewaterhouseCoopers predicts hospital system mergers to continue to grow.
As hospitals continue to merge, they have started to form new conglomerates in
the healthcare industry. One recent example is the merger between Catholic
Health Initiatives and Dignity Health, forming CommonSpirit Health.

CommonSpirit Health has sites across 21
states, 150,000 employees and over $30 Billion in revenue. With 90 percent of
Metropolitan Statistical Areas considered highly concentrated for hospitals as
of 2016, these mergers beg the question of
whether patients are benefitting. Furthermore, what are the anti-trust
implications of highly consolidated regional hospital systems?

A
new study from the American Hospital Association
claims “hospital acquisitions are associated with a statistically significant
2.3% reduction in annual operating expenses at acquired hospitals.” The
American Hospital Association suggest that by combining administrative
functions among hospital systems they can pass these savings onto patients.
However, a recent class-action lawsuit against Sutter
Health disputes this notion. Sutter Health – a Northern California health
system – is accused of using its market dominance to drive up the cost of
services. With such a high level of regional market control, hospital systems
like Sutter Health use “all-or-none” contracting with insurance companies to
demand higher prices for services. These costs trickle down to patients with
higher premiums and co-pays.

Patient
advocates attribute the Sutter Health lawsuit to lax
anti-trust practices when it comes to hospital mergers. While anti-trust
officials have the time and resources to focus on blockbuster industry mergers
such as CVS-Aetna, smaller mergers among regional hospitals
and healthcare service providers go unnoticed. An example of such mergers is
Anne Arundel Medical Center and Doctors Community Health System merging to form Luminis Health in Maryland.
These regional mergers often evade the eyes of regulators and patient advocates
warn of their potential to drive up costs by dominating regional markets and rarely
if ever lower costs.

An
industry-funded study
[ST1] from Deloitte points out, however; that mergers and acquisitions in
health systems lead to investments and improvements on acquired facilities and
lower operating costs. This same study also pointed to specific improvements in
patient reducing patient mortality, reducing wait times and reducing
readmissions. These are all factors anti-trust officials should consider when
deciding whether to challenge a merger. Anti-trust officials simply don’t have
the resources to analyze these deals;leaving patients footing the bill for increased costs. Hospital costs continue to
remain the largest overall share of healthcare spending
in the United States. To lower healthcare costs and improve patient outcomes,
it is time for regulators to examine these regional health system mergers and
their vast implications on patient outcomes and pricing.