Drug shortages affect consumer costs in several ways, including higher out-of-pocket costs, higher insurance premiums, and adverse health.
The chronic and worsening wave of drug shortages in the United States not only imperils patient health, it also costs them more money, a new study shows.
The study released this week by RAND Corporation finds that drug shortages affect consumer costs in several ways, including higher out-of-pocket costs, higher insurance premiums, and adverse health outcomes when the drug is unavailable or unaffordable. In addition, providers paying more for drugs are passing that cost on to patients.
Premier Inc. reported way back in 2011 that drug shortages cost providers at least $200 million a year. The Food and Drug Administration in 2020 identified 43 new and 86 unresolved shortages of active ingredients.
The shortages have worsened since then. The New York Times reported in May that “hundreds of drugs are on the list of medications in short supply in the United States, as officials grapple with an opaque and sometimes interrupted supply chain, quality and financial issues that are leading to manufacturing shutdowns.”
NBC News reported in May that “widespread shortages of cancer drugs are forcing doctors to make difficult decisions about how to treat their patients, including rationing doses and turning to other treatment options with potentially more side effects.”
The RAND study, commissioned by the Department of Health and Human Services, also found that:
Drug shortages affect consumers with reduced sales and/or increased prices.
The average drug shortage affects at least a half a million consumers, more than two thirds of whom are ages 65 to 85 (32%), 55 to 64 (24%) and 45 to 54 (17%).
After a drug shortage, sales volumes declined between 28% and 35% compared to the year before the drug entered a shortage. The reduction in volume of generic drug fills was larger (median of 37.6%) compared to brand-name drugs experiencing a shortage (median of 30.4%).
Drug shortages lead to a 16.6% increase in the price of drugs, driven mostly by an increase in the price of generics (14.6%). In some cases the price of generic substitutes was at least three times higher than the price increase of the drug in shortage.
The report highlights potential policies that could be pursued to address cost increases when there are shortages and to ensure sufficient supply of generic drugs.
To address the shortage, the report recommends that federal regulators tap into existing laws and policies that include requiring:
Drugmakers to notify FDA about drug making discontinuations or delays that are likely to lead to supply disruptions;
FDA to prioritize reviews of applications and inspections, as needed;
Manufacturers of flagged drugs or of any API used for preparation included in those drugs to develop, maintain, and implement, as appropriate, a redundancy risk management plan;
Registrants of drug establishments to report annually on the amount of each listed drug that they manufactured, propagated, compounded, or processed for commercial distribution.
In addition, FDA has already taken steps to prevent or mitigate shortages, including;
:
Working with manufacturers to increase production of certain drugs in shortage;
Expediting reviews of submissions to increase supply of products in shortage;
Working with manufacturers to determine if data support extending expiration dates of certain drugs in shortage;
Exercising temporary regulatory flexibility for sources of medically necessary drugs,
Issuing emergency use authorizations, under a public health emergency, for certain therapeutic treatments and patients.
FAIR Health reports that declines in telehealth claims were seen in all four U.S. census regions.
Overall private insurance telehealth claims fell 5.4% nationally in April, representing 5.3% of all medical claims, compared with 5.6% of claims in March, according to FAIR Health's Monthly Telehealth Regional Tracker.
The drop in telehealth claims was seen in all four U.S. census regions—the Midwest (4.7%), Northeast (6.3%), South (6.8%) and West (6.4%). The average patient visit lasted between 20 and 29 minutes, the median charge was $167.77, and the median allowed amount was $89.70.
Audio-only telehealth fell in both rural and urban areas nationally and in every region except the West, where it fell in rural areas but rose in urban areas.
The data was taken from privately insured population, including Medicare Advantage and excluding Medicare fee-for-service and Medicaid.
Mental health conditions continued to be the top-ranking telehealth diagnosis nationally and in every region, rinsing from 67.4% of telehealth claim lines nationally in March to 68.4% in April—the fourth straight month of national increases.
Claims for acute respiratory diseases and infections, the second most-common telehealth consultation, fell nationally in April from 3.2% in March to 2.7% in April, the fourth straight national monthly decrease for this diagnosis.
Developmental disorders rose to third place while joint/soft tissue diseases and issues fell to fourth place.
Among the top five diagnoses nationally via asynchronous telehealth places with urinary tract infections, rising to third place while UTI fell to fourth.
Asynchronous telehealth claims for hypertension increased to 12.5% nationally in April, up from 9.7% in March, and in every region. Hypertension rose from second to first place in the West and from fourth to second place in the South. It maintained its position nationally (second place) and in the other regions—second place in the Northeast and first in the Midwest.
Sleep disorders climbed in the rankings of asynchronous telehealth diagnoses from fifth to fourth place in the Northeast and from fourth to second place in the West. Diabetes mellitus rose in the rankings in three regions: from fifth to third place in the Midwest, from fourth to third place in the Northeast and from fifth to fourth place in the West.
The for-profit, megasystem has launched a webpage to keep patients informed.
HCA Healthcare Inc. announced Monday that it has discovered a data breach that could make vulnerable the personal information of many as 11 million patients at scores of care venues in 20 states.
In a media release, the Nashville-based for-profit health system says the information was "made available by an unknown and unauthorized party on an online forum."
The exposed data includes patients’ names addresses, emails, phone numbers, dates of birth, gender, service dates, locations and next appointment dates.
No clinical or payment data was exposed, nor were passwords or drivers’ license or Social Security numbers.
"This appears to be a theft from an external storage location exclusively used to automate the formatting of email messages," HCA says.
"There has been no disruption to the care and services HCA Healthcare provides to patients and communities. This incident has not caused any disruption to the day-to-day operations of HCA Healthcare. Based on the information known at this time, the company does not believe the incident will materially impact its business, operations or financial results."
HCA says it has reported the breach to law enforcement and has hired a third-party forensics investigator and "threat intelligence advisors." The investigation is ongoing but HCA says it has uncovered no evidence of "malicious activity" on its networks.
HCA shutdown user access to the storage location and will contact potentially affected patients and has launched a webpage to keep patients informed.
The legislation gives the executive enhanced powers to cut red tape and reduce trade barriers with 'trusted allies.'
A bipartisan bill introduced in the U.S. Senate aims to correct the nation's medical supply chain weaknesses that were exposed during the COVID-19 pandemic.
The Medical Supply Chain Resiliency Act, sponsored by U.S. Senators Thom Tillis (R-NC) and Tom Carper (D-DE) would strengthen the government's hand in trade negotiations that ensure that safe and timely delivery of critical medical goods.
A key component of the bill gives the president – through his appointed U.S. Trade Representative -- the authority to negotiate with "trusted allies" to eliminate tariffs and other barriers that weaken the medical goods manufacturing sector in the United States and allied nations. These agreements also would protect intellectual property rights and strengthen regulatory cooperation and collaboration on R&D efforts. Congress would be looped in on the status of these new trade agreements and would reserve the right to reject them.
"The pandemic caused major disruptions across nearly all supply chains, and these challenges disproportionately impacted our healthcare supply chain – from medical devices to life-saving medicines to personal protective equipment (PPE)," Tillis says in a media release.
"Now is the time to address the long-standing shortcomings in our supply chains that were highlighted over the pandemic, repair the damage done, and ensure America is adequately prepared for future national security and public health threats," he says.
Carper says the bill "will help mitigate trade challenges by authorizing the president to work more closely with our global partners and take action to ensure that healthcare providers and patients can access life-saving medical products when they need them the most."
"The pandemic wreaked havoc on our communities and caused our medical supply chains to break down during the worst possible time. We must prevent these same horrible losses from happening again by working together to fix our broken supply chains and better prepare for future public health emergencies," Carper says.
The bill has the support of key stakeholders, including the U.S. Chamber of Commerce, the National Foreign Trade Council, the Trade Alliance for Health, the National Foreign Trade Council, and the National Association of Manufacturers.
"This is practical legislation that, if enacted, will apply lessons learned in the COVID-19 pandemic to strengthen America's health preparedness," says John Murphy, senior vice president for international policy at the U.S. Chamber of Commerce.
The prestigious Los Angeles-based health system is now offering HIPAA-compliant, virtual second opinions in 21 states, including Arizona, California, Colorado, Connecticut, Florida, Hawaii, Idaho, Illinois, Minnesota, Montana, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, South Carolina, Utah, Vermont, Virginia and Washington.
"When you need specialized care for the most complex conditions, expertise matters," says Joanna Chikwe, MD, professor and chair of the Department of Cardiac Surgery at Cedars-Sinai. "So does convenience and speed. One of the special things about Virtual Second Opinion is that the physician can give each participant completely individualized and tailored treatment options."
The program is designed for patients looking to confirm a diagnosis or get more details about their condition, available treatment options, and finding a care regimen that best suits their needs. Cedars-Sinai says the virtual consultations are particularly valuable for patients living in remote areas who are unable to travel for an in-person consultation.
So far, Cedars-Sinai offers virtual second opinions on cardiac surgery, cardiology, spine surgery, and women's health, including coronary artery disease, aortic aneurysms and dissections, arrhythmias and valve dysfunction, disc disease, tumors and radiculopathies, endometriosis, abnormal bleeding, and ovarian tumors and cysts. Expansions into additional specialties are planned in the months ahead.
Patients ages 18 and older can request a virtual second opinion at a cost of $590 for Californians and $790 for out-of-state residents, owing to additional processing costs.
A nurse coordinator is assigned to the patient within 24 hours to help gather relevant health data and other relevant records, and a second opinion is offered within six days of receiving patients' documents.
Cedars-Sinai says most commercial health plans won't pay for the virtual second opinion, but patients with a health savings or flex spending account can tap it to cover the cost. The flat fee includes care coordination, medical record collection and a second opinion report prepared by a physician specialist. Patients can also schedule a virtual 30-minute educational session with specialists to review the report and answer questions.
Matthew Siedhoff, MD, vice chair of Gynecology at Cedars-Sinai, says the virtual second opinion can address underdiagnosed gynecologic conditions that "can cause women to suffer needless pain and frustration."
"A virtual second opinion can make such a difference,” Siedhoff says. "When patients come to us for an online visit, the imaging, lab tests, physical exam and other in-person tasks have already been done and can give us a good basis for evaluating the patient and recommending next steps."
Hispanic and Black adults were less likely than white adults to report having their care preferences considered by clinicians.
A solid majority (73%) of U.S. adults aged 50 and older say their care preferences are taken into consideration by providers, a 9.5% increase over 2014 responses to the same question asked in a survey sponsored by The SCAN Foundation.
However, the findings come with stark racial, economic, and geographic caveats.
Hispanic (52%) and Black adults (62%) were less likely than white adults (83%) to report having their care preferences always or usually considered in 2020 by clinicians, according to a data review by The LeadingAge LTSS Center @UMass Boston and Community Catalyst -- the first review of care preferences since the start of the COVID-19 pandemic.
Preferences include medications, treatment plans, care venues, and trust in their clinicians’ experience and demeanor.
"Ensuring personalized care as individuals age is vital for attaining quality outcomes and ensuring the utmost patient satisfaction," said Sarita A. Mohanty, MD, MPH, MBA, president / CEO of The SCAN Foundation. "Racial and ethnic disparities in how individuals perceive their care preferences being considered is deeply alarming and unacceptable. When preferences are not asked and respected, suboptimal care results."
Other findings show:
Income matters. Adults 50+ with household incomes less than $30,000 were less likely to say their care preferences were always or usually considered (66.1%) compared to those with incomes greater than $75,000 (85.1%).
Geography matters. Adults 50+ in the South were less likely to report care preferences were always or usually considered (71.9%) compared to those in the Northeast (76.4%), West (76.5%) and Midwest (80.2%).
Relationships matter. Adults 50+ with a usual source of care (e.g., a primary care doctor) reported an increase in their care preferences being usually or always considered (77.1% in 2020 vs. 69.9% in 2014).
"Numerous studies have shown that care that aligns with patient preferences is more effective," says Marc Cohen, PhD, co-director of The LeadingAge LTSS Center @UMass Boston and research director at Community Catalyst. "The healthcare system has a lot of work to do to address deep-seated inequities in how it listens and responds to patients of color."
The HIPAA breach by two dozen guards at Yakima Valley Memorial Hospital affected 419 patients.
A community hospital in Washington state will pay $240,000 to resolve patient records breaches by snooping security guards, the federal government says.
Not-for-profit Yakima Valley Memorial Hospital agreed to the settlement for the self-disclosed violations of the Health Insurance Portability and Accountability (HIPAA) in 2018, the Department of Health and Human Services Office of Civil Rights announced this week.
"Data breaches caused by current and former workforce members impermissibly accessing patient records are a recurring issue across the healthcare industry," says OCR Director Melanie Fontes Rainer.
"Healthcare organizations must ensure that workforce members can only access the patient information needed to do their jobs. HIPAA covered entities must have robust policies and procedures in place to ensure patient health information is protected from identify theft and fraud," she says.
According to OCR, following the self-disclosure of the violation in May 2018, the ensuing investigation determined that "23 security guards working in the hospital’s emergency department used their login credentials to access patient medical records maintained in Yakima Valley Memorial Hospital’s electronic medical record system without a job-related purpose."
The personal information of the 419 patients identified in the breach included names, dates of birth, medical record numbers, addresses, treatment notes, and insurance information, OCR says.
In addition to the fine, OCR will monitor Yakima Valley Memorial for two years to ensure HIPAA compliance and will also:
Conduct a risk analysis to determine risks and vulnerabilities to electronic protected health information;
Implement a risk management plan to address and mitigate identified security risks and vulnerabilities;
Develop, maintain, and revise its written HIPAA policies and procedures;
Enhance its existing HIPAA and Security Training Program to provide workforce training on the updated HIPAA policies;
Review all relationships with vendors and obtain business associate agreements.
The percentage of tele-mental health venues more than doubled between 2019 and 2022.
State policies adopted during the COVID-19 public health emergency more than doubled the number of mental health providers offering tele-mental health services.
However, expanded access to virtual care was lower in counties with a greater percentage of Black residents, according to a RAND Corporation study released Tuesday.
"Our results show that state policies have an important role to play in expanding access to mental health, which could be lost if telehealth policies don’t stay on the books," says Ryan McBain, lead author of the study and a policy researcher at RAND. "Likewise, disparities need to be addressed with local, targeted legislation."
The study examined four pandemic-related state policies: payment parity for telehealth services among private payers; authorization of audio-only telehealth services for Medicaid and the Children’s Health Insurance Program (CHIP); and participation in the Interstate License Exchange Program and the Psychology Interjurisdictional Compact, permitting psychiatrists and clinical psychologists, respectively, to work across state lines.
Using data from more than 12,000 mental health providers that was collected by the Mental Health and Addiction Treatment Tracking Repository about more than 12,000 facilities, the study focused on outpatient venues, which play an outsized role in telehealth care.
Between April 2019 and September 2022, the percentage of mental health treatment venues offering telehealth more than doubled, from 39% to 88%, the study found.
The number of states adopting payment parity during the 42-month study period grew from six to 28 and the number of states with audio-only payment policies increased from zero to 33. States allowing psychiatrists to practice across state lines grew from 28 to 38, while those allowing clinical psychologists to practice across state lines rose from seven to 32.
In addition, mental health providers in rural counties were more likely to offer telehealth than their urban counterparts, while Community Mental Health Centers were more likely to offer telehealth than other types of facilities.
However, when compared with counties with 5% or fewer Black residents, mental health facilities in counties with more than 20% Black residents were 42% less likely to offer telehealth.
Researchers also found that mental health facilities that accepted Medicaid and CHIP were about 25% less likely to offer telehealth services.
"This is consistent with previous studies finding that people enrolled in the programs may have reduced access to outpatient care as compared to people who have private insurance," the study notes.
The health system did not provide a new opening date for the 36-bed community hospital.
The opening of Novant Health Ballantyne Medical Center, scheduled to begin admitting patients today, has been "temporarily postponed pending the completion of state surveys," the Charlotte, NC-based health system says.
"We look forward to welcoming patients in the near future," Novant says in a brief media statement.
The health system did not elaborate on the nature of the surveys, nor did it provide a new opening date for the hospital. An adjoining 57,509 square-foot medical office building on the 38-acre campus in Charlotte opened today, as scheduled.
Novant held a ribbon cutting ceremony on May 30 for the 168,181 square-foot, $154 million, 36-bed community hospital, which the health system says "is strategically positioned to provide health care services to the rapidly growing suburban population in and around southern Mecklenburg County."
The hospital will provide emergency and inpatient services, diagnostic and surgical care, maternity care, and on-site specialty care services, including women's health, orthopedics and cancer.
"We recognize that this is not only a growing region, but one that's home to a diverse population that stretches across two states and ranges from young families to older adults, each with unique health care needs," says Ben Brodersen, president / COO of Novant health Ballantyne Medical Center.
"Ballantyne Medical Center and the outpatient services we co-located on campus were designed with the needs of the community in mind, including the flexibility to grow and add services as needed," Brodersen says.
The legal action comes days after Merck & Co. filed suit calling the mandate 'unconstitutional.'
The U.S. Chamber of Commerce on Friday filed suit against the federal government, claiming that the looming Medicare Drug Price Negotiation Program "violates fundamental protections for free enterprise enshrined in our Constitution."
Arguing that the price controls -- a component of the 2022 Inflation Reduction Act -- "would have long-term implications for free enterprise and U.S. competitiveness," the business lobby warns that such a mandate could spread to other areas of the private sector.
"If the government can set price controls for essential medicines through a black-box regime without allowing for judicial review, the government can do the same for other essential industries, which would be disastrous for our economy and for individual rights," the Chamber says.
"When the government caps prices, it caps innovation and endangers access to better treatments—harming patients the most. The new IRA provisions establish an artificial and arbitrary system for devising price caps that will jeopardize medical breakthroughs for individuals with life-threatening and chronic illnesses."
The Chamber suit was filed in U.S. District Court in Dayton, Ohio.
The Drug Price Negotiation Program allows Medicare, for the first time ever, to leverage its unmatched market power to negotiate with drug makers for certain high-price drugs. The negotiations start in September but will be limited to 10 drugs named by Medicare.
The Chamber says that calling the program a "negotiation" is a misnomer.
"The price imposed by the government at the end of the ‘negotiation’ cannot be declined by the manufacturer," the Chamber says. "The only way to escape the price is to leave the Medicare program altogether, but that cannot be accomplished in time to avoid the government-set price on some sales or the excise tax penalty on others."
"This would be devastating for patients in Medicare and would impose crushing financial consequences on manufacturers, further inhibiting their ability to develop and deliver treatments to the market."
Earlier this week, Merck & Co. filed suit in a Washington, D.C. federal district court, alleging that the price negotiation program was unconstitutional, and would hamstring the "bio-pharmaceutical sector's ability to address health threats."
"By coercing Merck to provide its drug products at government-set prices, the program takes property for public use without just compensation in violation of the Fifth Amendment," Merck says.
"In addition, the IRA creates the false impression that innovators like Merck are voluntary participants in its program by coercing them to sign an ‘agreement’ conveying that the government-set prices are the ‘fair’ result of a ‘negotiation.’ That compelled mirroring of the government's political message violates the First Amendment."
"Merck's ridiculous lawsuit is the equivalent of a toddler throwing a temper tantrum," says Richard Fiesta, executive director of the Alliance for Retired Americans.
"Americans pay the highest prices in the world for prescription drugs and too many seniors must choose between putting food on the table and paying for their medicine. That is because corporations like Merck have been allowed to charge taxpayers whatever they want for their drugs," Fiesta says.
