A review of compensation for 2,845 Mayo physicians — including 861 women — affirmed pay equity in 96% of the cases.
Mayo Clinic's structured, salary-only compensation model appears to have successfully tackled the nettlesome issue of gender pay disparity, a review shows.
A review of the compensation model — which relies on national benchmarks, standardized pay steps, and increments — for 2,845 Mayo physicians — including 861 women — affirmed pay equity in 96% of the cases, according to the analysis, which was published inMayo Clinic Proceedings.
"Our analysis is unique and to our knowledge the first to demonstrate that a structured compensation model achieved equitable physician compensation by gender, race and ethnicity, while also meeting the practice, education and research goals of a large academic medical center such as Mayo Clinic," study first author Sharonne Hayes, MD, a Mayo Clinic cardiologist said in amedia release.
"The analysis of this long-standing salary-only model was reassuring, not only that it was equitable, but that we as an organization adhere to our own standards," she said.
Gender pay disparity has long been a problem for physicians, and in some specialties it may be getting worse.
In July, the Medscape Female Compensation Report 2019 found that more than 7,000 female primary care physicians reported an average annual salary of $207,000, compared to the average $258,000 compensation for men; a 25% pay gap that widened from 18% in the 2018 survey, with women earning $203,000 compared to $239,000 for men.
The gender pay gap for specialists narrowed from 36% in 2018 to 33% in 2019, with the average male specialist earning $372,000 and the average female specialist earning $280,000.
The researchers reviewed all permanent staff physicians employed at Mayo Clinic in Arizona, Florida and Minnesota in clinical roles as of January 2017; examining each physician's pay, demographics, specialty, full-time equivalent status, benchmark pay, leadership roles and other factors.
The few physicians whose salaries were not in the predicted range were re-examined and shown to have the appropriate compensation, most often due to unique or blended departmental appointments, the researcher said.
"Of the 80 physicians — 2.8% of the total — with higher compensation than predicted by the model, there was no correlation with gender, race or ethnicity. The same was true of the 35 physicians — 1.2% — who had lower-than-predicted compensation," the researchers said.
Mayo adopted a structured compensation model more than 40 years ago, primarily to remove financial incentives for physicians to do more than is medically necessary. The model provides no incentives or bonus pay, and non-salary compensation and benefits are consistent across Mayo Clinic venues and specialties.
More men than women held compensated leadership positions or had past leadership roles — 31.4% of men were in that category, compared with 15.9% of women — and more men than women were in the highest compensated specialties.
Mayo Clinic CEO Gianrico Farrugia, MD, the study's co-author, said achieving "absolute gender pay equity will only be realized when women achieve parity in the most highly compensated specialties and leadership roles."
The rule would require insurers to disclose negotiated rates for in-network providers and allowed amounts paid for out-of-network providers.
The federal government has extended by two weeks the comment period for aproposed rule mandating price transparencyfrom health insurers on out-of-pocket costs for consumers.
The Centers for Medicare & Medicaid Services said in a media release that the 15-day extension that ends on January 29 was needed to account for robust public feedback and the consideration of the holiday season.
If finalized, the proposed Transparency in Coverage Rule would mandate that consumers have real-time access to cost-sharing information, including out-of-pocket expenses, through a user-friendly online tool that most group health plans and health insurance issuers would be required to have.
The rule would also require insurers to disclose on their websites their negotiated rates for in-network providers and allowed amounts paid for out-of-network providers.
The rule goes into effect in 2021.
"Making this information available to the public is intended to drive innovation, support informed, price-conscious decision-making, and promote competition in the healthcare industry," CMS said of the proposed rules.
The proposed rule on health plan transparency was unveiled on November 15, as one of two rules mandating price transparency from hospitals and insurers. Both proposals were met with a chorus of boos from payers and providers.
Matt Eyles, president and CEO of America's Health Insurance Plans, said in November that price transparency "should aid and support patient decision-making, should not undermine competitive negotiations that lower patients' health care costs, and should put downward pressure on premiums for consumers and employers."
"Neither of these rules—together or separately—satisfies these principles," he said.
Anticipating the blowback, President Donald Trump on November 15 joked that insurers would be "thrilled" by the mandate.
"This will allow you to see your out-of-pocket costs and other vital price information before you go in for treatment, so you're going to know what it's going to be and you're going to be able to have lots of choices, both in terms of doctors, hospitals, and price," he said.
The Rural Health Model, the first of its kind, creates an alternative payment model that transitions hospitals from fee-for-service to global budget payments.
Eight more hospitals and one payer have joined a Pennsylvania initiative to shore up the financial footing of the state's rural hospitals.
"I am especially pleased to see more hospitals joining this important initiative to improve their financial viability so that every Pennsylvanian has access to quality health care within a reasonable distance from home," Gov. Tom Wolf said in a media release.
State officials the program is needed because nearly half of all rural hospitals in Pennsylvania are operating with negative margins and are at risk of closure. Four rural hospitals in Pennsylvania have shuttered since 2006, according to the North Carolina Rural Health Research Program.
The Rural Health Model, the first of its kind, creates an alternative payment model that transitions hospitals from fee-for-service to global budget payments. Those global payments come from several payers, including private and public insurers.
Instead of getting paid for admissions, hospitals in the model will get a preset amount of money to provide services in the community.
State officials say the new payment model allows hospitals time to transform care to better meet the health needs of the community. This includes providing nontraditional roles, such as providing transportation and broadband internet access.
The eight hospitals are:
• Armstrong County Memorial Hospital in Kittanning.
• Chan Soon-Shiong Medical Center at Windber in Somerset County.
• Fulton County Medical Center in McConnellsburg.
• Greene Hospital in Waynesburg, Greene County.
• Monongahela Valley Hospital in Monongahela, Washington County.
• Punxsutawney Area Hospital in Punxsutawney, Jefferson County.
• Tyrone Hospital in Tyrone, Blair County.
• Washington Hospital in Washington, Washington County
A total of 67 hospitals are eligible for model based and nearly 20% of them will participate in in 2020, state officials said.
In addition, Aetna will join five other private payers – Gateway, Geisinger, Highmark, Medicare and UPMC – which combine make up nearly half of the individual and small group market insurance population in the state.
The program is funded and administered by the newly created Rural Health Redesign Center Authority and the Pennsylvania Rural Health Redesign Center Fund.
In addition to providing access to care for rural communities, state officials say the model will ensure that, by remaining open, rural hospitals continue to be a vital economic driver for their communities.
"The Rural Health Model is a transformative step that changes the financial model for hospitals in rural areas," said Pennsylvania Secretary of Health Rachel Levine, MD. "This is a step that will help achieve financial stability for these facilities and aims to improve the overall health of the community."
Since 2005, 162 rural hospitals have shuttered, with 60% of the closures occurring in southern states that did not expand Medicaid enrollment.
Despite a booming national economy, 2019 was the worst year for hospital closings since at least 2005.
The North Carolina Rural Health Research Program says that 19 rural hospitals closed this year, up from 15 closures in 2018, and continuing a steady double-digit trend in closures since 2013.
Since 2005, the North Carolina researchers tracked 162 hospital closings, with 60% of the closures occurring in southern states that did not expand Medicaid enrollment.
Texas led the way, with 23 hospital closures since 2005, followed by Tennessee with 13, and North Carolina with 11.
The closures have been blamed on a number of factors, including: the older, sicker, poorer, and less-concentrated rural demographic; bypassing by local residents seeking care at regional hospitals; hospital consolidation; value-based care; referral patterns of larger hospitals; the transition to outpatient services; and mismanagement.
Among the findings highlighted by the North Carolina Rural Health Research Program:
More than half of the rural hospitals that close cease to provide any type of health care, which were define as abandoned.
Most closures and "abandoned" rural hospitals are in South (60%), where poverty rates are higher, people are generally less healthy and less likely to have public or private health insurance.
Most hospitals closed because of financial problems. 38% of rural hospitals are unprofitable.
In 2016, 1,375 acute care hospitals out of 4,471 urban and rural acute care hospitals (31%) were unprofitable, including 847 rural hospitals (versus 528 unprofitable urban hospitals).
Patients in communities affected by closure travel 12.5 miles on average for care. However, 43% of the closed hospitals are more than 15 miles to the nearest hospital, and 15% are more than 20 miles.
The typical rural hospital employs about 300 people, serves a community of about 60,000. When the only hospital in a county closes, there is a decrease of about $1,400 in per capita income in the county.
University of Minnesota research shows that between 2004 and 2014, 179 rural counties lost all hospital-based OB services.
Over the last 15 years, the difference in mortality between rural and urban areas has tripled – from a 6% difference to an 18% difference in 2015.
Federal policy makers are examining regulations that require more-stringent supervision, or that limit providers from practicing at the top of their license.
The Centers for Medicare & Medicaid Services is asking stakeholders for more input and recommendations on policy changes that could eliminate some Medicare scope of practice restrictions.
Specifically, federal policy makers are considering revamping regulations that require more-stringent supervision than provided now by existing state scope of practice laws, or that limit providers from practicing at the top of their license.
CMS is acting on the executive order #13890, Protecting and Improving Medicare for Our Nation's Seniors.
"These burdensome requirements ultimately limit healthcare professionals, including Physician Assistants and Advanced Practice Registered Nurses, from practicing at the top of their professional license," CMS said in a media release.
But expanded scope of practice for advanced practice practitioners has been contentious. Physician groups have insisted on medical-doctor supervision of advanced practice practitioners.
For example, in 20 states, a physician must co-sign a percentage or number of physician assistant charts, according to the American Medical Association. In 39 states, there are limits on the number of physician assistants a physician can supervise or with whom a physician can collaborate.
CMS said it has already made regulatory changes in payment rules, including the CY 2020 Physician Fee Schedule, Home Health, and Outpatient Prospective Payment System final rules.
These changes include a redefinition of physician supervision for PA services, allowing therapist assistants to perform maintenance therapy under the Medicare home health benefit, and reducing the minimum level of physician supervision required for hospital outpatient therapeutic services.
"We are proud of the work accomplished," CMS said. "Now we need your help in identifying additional Medicare regulations which contain more restrictive supervision requirements than existing state scope of practice laws, or which limit health professionals from practicing at the top of their license."
Additional recommendations and comments should be sent to PatientsOverPaperwork@cms.hhs.gov with the phrase "Scope of Practice" in the subject line by Jan. 17, 2020.
Michael Dowling challenges healthcare CEOs nationwide to join campaign to stop the bloodshed.
It's time for healthcare leaders to take a stand against firearms violence!
That's what Northwell Health President and CEO Michael Dowling is doing, with a pledge of $1 million to mobilize healthcare providers to combat gun violence as a national public health crisis.
The leader of the largest health system in New York State is also challenging his colleagues at other large health systems in the region to match the investment.
"I have been frustrated by the inability of many health system CEOs to stand up and talk about the issue of gun violence," Dowling told more than 170 attendees at Northwell's Gun Violence Prevention Forum, this month in Manhattan.
Northwell organized the conference to increase awareness of gun violence as a public health issue and leverage the power of a $3.5 trillion industry with a workforce of more than 18 million to find ways of stopping the bloodshed. The conference included physicians, trauma surgeons, researchers, policy experts and healthcare executives.
The movement has its own hashtag #ThisIsOurLane.
"CEOs can't be silent anymore, not on an issue this big. If you have the courage and strength to run a big health system, you should have the courage to stand up and talk about this," he said. "My goal is to get all major health systems in the United States to pledge their support."
Mark Rosenberg, MD, a public health researcher and former head of the U.S. Centers for Disease Control & Prevention’s National Center for Injury Prevention and Control, said most the gun deaths can be prevented by using science. He cited previous government and medical community interventions to eradicate smallpox, reduce smoking, and highway deaths through seatbelt mandates and tougher DUI laws.
"The sound of screaming babies (wounded or killed by gunshots) in my trauma center continues to haunt me," said conference attendee Sheldon Teperman, MD, director of trauma and critical care services at New York city Health + Hospitals' Jacobi Medical Center. "My voice was not loud enough to bring about change, but the healthcare community as a whole has broad shoulders."
The conference drew representatives from more than 100 health systems, and medical and health trade organizations across the country, mostly from outside the New York area.
Dowling called on healthcare leaders to sign on to a call to action that will lay the groundwork for the public health education/awareness campaign on gun violence.
The 408-bed, acute care hospital in downtown Los Angeles becomes the third hospital in the PIH Health system.
Good Samaritan Hospital, Los Angeles this week has cleared regulatory hurdles and has joined PIH Health, the health system announced.
The hospital will be renamed as PIH Health Good Samaritan Hospital. Financial terms of the acquisition were not disclosed.
"Good Samaritan Hospital has an impressive 130-year history and we are thrilled to welcome their physicians, staff, volunteers and patients to the PIH Health network," James R. West, PIH Health President and CEO, said in a media release.
"Adding Good Samaritan Hospital into the PIH Health network enables us to continue to build our resources and expertise to enhance the care and services we provide to all of our patients, offering a high level of both primary and tertiary care, and creating a sustainable model in the current and foreseeable healthcare marketplace."
With the addition of the 408-bed acute care hospital, non-profit, Whittier. California-based PIH Health now operates three hospitals totaling 1,130 licensed beds, and 26 outpatient clinics, with 7,100 full-time employees.
The acquisition was announced in September, and PIH vowed to "invest resources and capital to provide Good Samaritan Hospital with the ability to remain dedicated to the highest quality healthcare in its current location in downtown Los Angeles."
The two hospitals will spend the new year developing a transition plan.
"PIH Health and Good Samaritan Hospital share a common commitment to the health and wellness of the residents of Southern California. We plan to expand services that will benefit even more members of our community," said Andrew B. Leeka, PIH Health Good Samaritan Hospital CEO.
"We believe that combining the resources and expertise of two of Southern California's outstanding health systems will result in enhanced care and services," he said.
PIH's other hospitals are PIH Health Hospital - Downey, PIH Health Hospital - Whittier and PIH Health Physicians.
Founded in 1885, Good Samaritan Hospital has been organized under the auspices of the Bishop of the Los Angeles Diocese of the Episcopal Church.
The slow pace of hospital quality improvement frustrates patient safety advocates.
ORLANDO – Hospital leaders must adopt safety and quality as primary business strategies, rather than regarding them as tertiary metrics that rank below finances and other stressors on the C suite's list of top priorities.
That's according to Derek Feeley, president and CEO of the Institute for Healthcare Improvement.
Speaking to reporters here this month at IHI's 31st National Forum, Feeley says there are moral and financial imperatives for making safety a priority.
"The thing that should be uppermost in every healthcare leaders' minds is safety," he says. "If we create high-quality, safe healthcare systems, they are much more likely to be thriving and financially viable than healthcare systems that are unsafe and delivering a quality of care that patients need or want."
Given the stressors of hospital operations, Feeley says it's not surprising that hospital leaders get sidetracked.
"It's the way the system works. The current environment is one of growing consolidation and (people) are trying to figure out how to make sense of these often-conflicting payment models," he says. "Some of it's also what the board of governance and senior executives value, and part of that is the financial vitality of the institution."
"I keep trying to bring them back to there's another way to think about this. Is it at least possible to conceive that we can make quick progress on safety as our business strategy?" he says.
In August, the World Health Organization issued a report that one-in-10 hospital patients in "high-income countries" suffer harm, and that half of those adverse events are preventable.
IHI President Emeritus and Senior Fellow Donald M. Berwick, MD, was asked by reporters to assess what progress the healthcare sector has made over the past 20 years since the Institute of Medicine's landmark 1999 To Err is Human report.
"I'd say it's a B+ on the project-level improvements," Berwick replied, citing notable reductions in infections, pressure ulcers, ventilator pneumonia and surgical complications.
"Place-by-place you can see pretty serious improvements once people decide to work on it," he says.
The problem, he says, is that safety improvements are missing on a system level and can vary greatly among healthcare providers, and within geographic areas.
"We're at the really the point now where it's time to get serious," Berwick says. "We now know we really don't need to have pressure ulcers. We really don't need to have surgical site infections. We know how to virtually eliminate them."
"The bad news is we're seeing surveys, and when you ask healthcare executives and senior teams to rank what's on their mind, whereas safety was pretty high up there, number one or two a few years ago, it's now five or six, and we're finding places backing away," he says.
Rick Pollack, president and CEO of the American Hospital Association, disagreed "categorically" with the IHI leaders, adding that the "focus on quality in the DNA of our own organizations."
He noted that, between 2014 and 2018, hospitals in the AHA's Hospital Improvement Innovation Network program saved $1.2 billion in health care costs, prevented 141,000 patient safety events and saved 14,000 lives.
"To coin a phrase, quality is job one. If you're not providing the highest quality possible, then you're not serving your mission," Pollack told HealthLeaders. "The reality is that what you often see is people will rather shut down the service completely in order to provide the highest quality and services that they do provide.
That commitment to quality and safety metrics plays out in executive compensation.
"We see more performance-based compensation linked to quality Improvement than we ever have the past," he said.
Feeley said quality and safety are being address, but not quickly enough.
"It's not that we haven't made progress, but 20 years on, this ought to be the norm," he says. "We should have already moved on from patient safety being something we do and our project being a way (to do it), but it's not yet embedded. It still requires constant attention and maybe it always will."
"That's why I'm feel so passionately about this, as I see the risk of that diversion of attention and energy. It's right that we remind people that what started 20 years ago in earnest has made some progress but there's still so much to do," he says.
Abortion rights advocates say the new rule continues the Trump administration's 'attack on patients and their ability to obtain health are coverage for abortion care.'
The Centers for Medicare & Medicaid Services issued a final rule Friday that mandates separate billing and collection for abortion services coverage provided by state exchange plans under the Affordable Care Act.
"The rule better aligns with Congress' intent that qualified health plans collect two distinct payments, one for the coverage of abortion services, and one for coverage of all other services covered under a Qualified Health Plan," CMS said in a media release.
Health and Human Services Secretary Alex Azar called the separate billing requirement "an essential step in implementing the Affordable Care Act's bar on tax credits going toward coverage of abortions for which public funding is prohibited."
The requirements are part of a broader package of regulations in the Exchange Program Integrity Final Rule, which federal policymakers say will strengthen oversight of state-based exchanges and ensure beneficiaries' eligibility for premium subsidies.
"Pursuant to the law, this rule will ensure that taxpayers do not contribute funds to pay for coverage of abortion services for which funding isn't allowed by law, and will alert consumers that their health plan covers abortion services, allowing them to make fully informed decisions about their coverage," CMS said.
'A Non-solution'
Margaret A. Murray, CEO of the Association of Community Affiliated Plans, called sending beneficiaries two separate bills every month "a non-solution in search of a problem."
"This misguided rule will only succeed in introducing confusion to the Marketplace on a massive scale, and put millions of consumers at risk of losing their coverage," she said.
Murray noted that failure to pay both bills each month could jeopardize coverage for beneficiaries.
"It’s hard to think of another industry where the government mandates, as the Trump administration would here, that consumers cut two checks a month for the same service," she said. "This rule is a departure from standard accounting practices and imposes operational and financial challenges for plans as they work to comply with the separate billing requirements. But the most significant burdens of this rule fall on the consumer."
The added and needless complexity and administrative burden of the new rule imposed upon insurers and consumers could also lead health plans to drop abortion coverage, she said.
"This provision of the Program Integrity rule will wrap Marketplace coverage in red tape," Murray said. "The administration should withdraw these requirements immediately."
April Lockley, MD, a family medicine physician in New York and Fellow with Physicians for Reproductive Health, said the new rule continues the Trump administration's "attack on patients and their ability to obtain health are coverage for abortion care."
"Navigating the confusing medical insurance industry is already difficult enough and this new rule further burdens patients," she said.
Margarida Jorge, executive director of Healthcare for America Now, called the final rule "just another example of the Trump administration's concerted efforts to strip abortion access from millions of people."
"This extra bureaucracy is aimed at causing confusion among consumers, stigmatizing abortion and limiting access to insurance coverage for abortion by discouraging insurers from offering this coverage," she said.
Jorge urged insurers to "take a stand against this burdensome rule and continue offering coverage for reproductive health services, including abortion care."
Under the new final rule, state-based exchanges will be required to conduct ongoing eligibility verifications with outside data sources at least twice a year, CMS said.
In addition, the rule aligns federal regulations with the statutory requirements of the ACA to help ensure consumers understand the coverage they are buying.
With the new requirements in place, CMS said it will be able to better identify and correct eligibility and enrollment issues sooner, which can minimize the time consumers inadvertently receive tax credits that they will have to pay back later, and mitigate risks that they are paying premiums for a plan they no longer need.
The separate billing requirements in the final rule become effective June 27, 2020. The rest of the final rule takes effect nationwide in February 2020.
CMS said the final rule was crafted after the HHS Office of Inspector General and the Government Accountability Office identified weaknesses in the process for determining eligibility for advance payments of the premium tax credit (APTC) and cost-sharing reductions (CSR) in both state and federal exchanges.
The rule enhances oversight of state-based exchange program reporting to confirm states are correctly identifying eligible enrollees, including those who are qualified for APTC and CSRs, CMS said.
In addition:
CMS is finalizing changes that clarify the scope of such annual SBE audits, including procedures to test eligibility and enrollment transactions to ensure SBEs that operate their own eligibility and enrollment platforms are properly determining consumer eligibility for QHPs, APTC and CSRs.
The rule also implements safeguards regarding the eligibility and enrollment process across all Exchanges, including SBEs, State-based Exchanges on the Federal Platform, and Federally facilitated Exchanges. This includes enhanced periodic data matching that will allow CMS to more frequently identify and resolve issues related to consumers who are dually enrolled in both Medicare and a QHP through the Exchange.
"This will ensure that people are enrolled in the most appropriate type of coverage for them," CMS said. "Beginning with plan year 2020, CMS will require SBEs to conduct Medicare, Medicaid/CHIP, and as applicable, Basic Health Plan periodic data matching at least twice a year for QHP enrollees who receive subsidies."
Stakeholders will have the next 75 days to comment on the proposed rule, which largely follows an outline HHS provided in July.
Health and Human Services Secretary Alex Azar unveiled a two-pronged proposed rule Wednesday that lays the groundwork to allow states and drug companies to import prescription drugs from Canada.
"New pathways for importation can move us toward a more open and competitive marketplace that supplies American patients with safe, effective, affordable prescription drugs," Azar said Tuesday afternoon during a call with reporters.
Azar said the proposed rule would allow for the importation of the kinds of drugs consumers would obtain from a retail pharmacy, but it would exclude controlled substances and IV drugs, including insulin.
Under the "first pathway" of the proposed rule, the Food and Drug Administration sets the rules that would authorize states, potentially working with wholesalers, to develop programs that allow for drug importation of FDA-approved drugs.
"We appreciate the strong interest and leadership we've seen regarding this possibility from governors in both parties," Azar said, noting that Florida, Maine, New Hampshire, Colorado and Vermont have expressed an interest in the plan.
HHS's proposed "second pathway" provides draft guidance for drug makers to import FDA-approved drugs when the drug is made abroad, authorized for sale in any foreign country, and originally intended for sale in that foreign country.
Azar said the second pathway would allow drug makers to sidestep middlemen pharmacy benefits managers and the "bizarre way in which we pay for drugs in the United States" that passes rebates to insurance companies and sticks consumers with list prices.
"What drug companies have told us, and we'll have to see if they live up to this, is that if they could only get a new national drug code for that exact same drug, that they could issue that drug at a lower list price, bringing savings to patients at the pharmacy counter," Azar said.
"And so the second pathway says, if you're a drug company and you're selling the exact same product in Europe or Canada or Japan and you would like to bring that same product in the United States to basically compete against your own product but at a lower list price, that we will give you a new national drug code to be able to do that," he said.
Stakeholders will have the next 75 days to comment on the proposed rule, which he called "largely consistent" with an outline HHS provided in July.
"This is the fleshing out of all the legal and implementation parameters of it," he said
Azar provided no firm date on when the rule would take effect, but he said HHS is moving "as quickly as humanly possible."
"As for pathway two, that guidance may perhaps be able to move even faster, given the fact that that that's a guidance procedure on issuing new drug codes," he said.
PhRMA Pans the Proposal
Pharmaceutical Research and Manufactures of America President and CEO Stephen J. Ubl dismissed the proposed rule as "a political maneuver."
"At a time when there are pragmatic policy solutions being considered to lower costs for seniors at the pharmacy counter and increase competition in the market, it is disappointing the Administration once again put politics over patients," Ubl said in prepared remarks.
"The Administration chose to proceed with an importation scheme that could endanger American lives, could worsen the opioid crisis and has been called unworkable by Canadian officials," Uble said. "Instead, they could have worked with stakeholders to develop and advance meaningful solutions that would directly benefit patients."
Nonetheless, Ubl said PhRMA would review the proposal and provide feedback "with the hope that no patients are endangered by this political maneuver."
Only FDA-approved Drugs are Eligible
Assistant HHS Secretary Admiral Brett P. Giroir, MD, said that drugs eligible for importation would need to be approved by Health Canada and would need to meet the conditions in an FDA-approved new drug application.
"Essentially, eligible prescription drugs are those that could be sold legally in either the Canadian market or the American market with appropriate labeling," he said. "Eligible prescription drugs would have to be relabeled with the required U.S. labeling and undergo testing to ensure that they are authentic, not degraded, and in compliance with established specifications and standards."
"Importantly, the products imported under the pathway described in the draft guide could be available to patients in a variety of settings, including hospitals, healthcare providers' offices and licensed U.S. pharmacies and would include the FDA-approved labeling," Giroir said.
Giroir said the draft guidance does not address generic drugs, "because we are not aware of similar private market challenges for reducing the cost of generic drugs."
"However, the agency is soliciting comments from manufacturers of generic drugs, and other interested stakeholders on whether it would be appropriate to provide guidance on a similar import approach for generic drugs," he said.
Azar said HHS has not done any estimates on the potential cost savings under the proposed rule "because we do not know which states will come forward with plans once a rule is finalized."
"We don't know what those plans will be. We won't know which particular drugs would be in their plans and we don't know the volumes. It's undefinable for purposes of cost projection, at this point," he said.
'This is Not a Silver Bullet'
Speaking to reporters Wednesday in Tallahassee, Florida Republican Gov. Ron DeSantis called the proposal "just one step in the grand scheme of things."
"This is not a silver bullet. This is one step in a long process that we've got to go through and obviously we in Florida don't control all of it," he said. "I'd much rather be here, moving forward, than just being on the sidelines chirping and saying 'Oh why doesn’t somebody do something about it."
DeSantis noted that a quarter of the Florida's Department of Corrections' healthcare budget goes for prescription drugs. "So, even if you get some modest savings out of this for them, that could be tens of millions of dollars in savings for the state of Florida," he said.
Azar, who attended the Wednesday press conference in Tallahassee with DeSantis, said he hopes the Canadian government "will work with us" to facilitate the importation plan.
"Obviously, the Canadians are going to be looking at for Canadians just as the president and myself and Governor Santos we're here to put American patients first," he said.
"But as long as they're getting lower prices, as long as they are free-riding off of American investment in innovation, the president is committed to ending foreign free-riding and we're committed to bringing the lower price discount products to the United States."
"If the drug companies are willing to give discounts to other countries that are similarly positioned economically to the United States, then the United States, where we are the largest pharmaceutical market in the world, we ought to be getting deals like that," he said.
In a separate announcement on Wednesday, the Associated Press reported that New York Democratic Gov. Andrew Cuomo plans to create a commission to investigate the potential benefits of importing prescription drugs from Canada.
