Month: November 2017

Why Prescription Drugs are Expensive and What We Can Do About It

By Mark A. Kelley, MD |11/28/17
Founder, HealthWeb Navigator

As the healthcare debate drags on in Congress, prescription drug costs continue to rise by almost 10% annually. It is the rare patient who is spared this expense.

Over the years, I have seen how these costs have affected my patients. At first, most patients had little in the way of co-pays. However, once the local economy deteriorated, co-pays skyrocketed as employers tried to curb their healthcare expenses. Now, monstrous co-pays are the norm for health insurance plans across the nation.

The solution to this problem appeared simple. Drugs with expired patents are usually much cheaper for patients. Insurance companies encouraged physicians to prescribe these “generics” and used this practice as a metric to measure quality.

That strategy has indeed worked. Generic drugs now account for 89% of all prescriptions but only 26% of all drug expenditures.

Unfortunately, this success has not prevented drug inflation. Countless new drugs have emerged over the last thirty years. Some have been “blockbusters” that substantially change medical practice, but the rest have had much less impact. All of these new drugs, blockbusters or not, are protected by patents and promoted by aggressive marketing. They command high prices and subsequently drive up the average cost of prescribed drugs.

Recently, several events have given me a deeper appreciation of the reality experienced by our patients.

The first “surprise” was witnessing a 400 percent increase in the cost of the albuterol inhaler, an asthma product that has been around for decades. Because the inhaler propellant was changed, the manufacturer sold this product as a newly patented “delivery system.” This patent loophole is a common tactic in the drug industry. In this case, the FDA predicted that the loophole would cost consumers $8 billion before the patent expired in 2017.

The second revelation was a variation of the same theme. One of my patients watched the market price of a skin medication double in just four years. The reason was that the company’s drug patent was about to expire. The final price tag for the drug was $300 — for a six-week supply. This is another common industry tactic.

But the most surprising outcome has been the emergence of “competitive” generic drugs. Most generics have a low price point. However, if a large generic manufacturer has little competition, it can act like a monopoly and raise prices on its own terms.

A well-publicized example was the dramatic rise in the price of the “Epipen.” This pre-loaded injector of epinephrine can be life saving during severe allergic attacks. In 2007, one injection cost $50. By 2016 the price was $300 — for the same drug and injector. This tactic, termed “price gouging,” is now illegal in the state of Maryland. Other states may soon follow.

These pricing maneuvers have made drug prescribing more complicated for both patients and their physicians. Generics may no longer be “safe bets” for low costs. New and more expensive drugs may not be any better than generics. And drugs may have different co-pays, depending on the insurance plan.

How is one to know? The answer is simple: the patient and the doctor need to communicate.

I learned that lesson with my own new prescription. My doctor explained carefully why she preferred this brand-name product. When I picked up the prescription, the price tag was $420 for a 75-day supply!

When I mentioned this cost to my physician, she was even more astounded than me. She quickly changed the prescription to a generic product that cost $29 for the same duration of treatment. She felt the advantage of the first medication was minor compared to its overwhelming cost, which was 14 times more expensive.

Pharmacists have told me that this “sticker shock” is becoming more common among patients picking up their meds. But that situation is preventable. Doctors should know the prices and efficacy of the drugs they commonly prescribe, and patients should ask for the drug prices up front. In my case, both my physician and I should have done that homework. Thankfully, all that was needed to solve the problem was a painless follow-up discussion.

Drug price information is easy to find online, since pharmacies compete fiercely for business. The market price for most drugs is available via a simple Google search of the specific drug name with the term “price.” Here on HealthWeb Navigator, you can find several websites that help patients locate and compare drug prices.

If the drug is expensive (e.g. three digits for a typical 30 day prescription), the out-of-pocket cost (co-pay or deductible) is likely to be significant. If the local pharmacist has the patient’s insurance information, s/he can quickly quote how much the patient must pay. If the out-of-pocket cost is high, a less expensive yet effective drug may be preferable. If the patient cannot afford the drug, there are organizations such as NeedyMeds that can help with discounts.

Healthcare economics may be complicated, but drug cost is where patients and their doctors can team up. Patients want to be healthy but don’t want to go broke in the process. Informed doctors are in the best position to advise patients of the trade-offs between cost and benefit. Working together, doctor and patient can make an informed choice.

There is a lot of room for improvement. In a recent poll, 60% of patients feel their doctor is unaware of how much they pay for drugs. Doctors need to be better informed about drug costs and help patients deal with this challenge. 

If you are looking for a perfect model of patient-centered care, this is it. After all, as my own story illustrates, when doctors become patients, we face the same reality as everyone else.

Physician Burnout and the Battle for Time

By Mark A. Kelley, MD |11/10/17
Founder, HealthWeb Navigator

According to published reports, over 50% of doctors are burned out. The reason? They are overwhelmed by payment and quality rules as well as poor information technology.

It’s no secret that physicians spend long hours seeing patients. But as financial pressures have mounted within hospitals, doctors are forced to perform more administrative tasks. In fact, administrative tasks account for nearly a quarter of the average doctor’s schedule. That’s all time diverted away from patient care.

Many physicians feel a loss of autonomy, a major factor in burnout. The National Academy of Science now sees burnout as a major threat to maintaining our physician workforce.

The key issue is how we want healthcare professionals to spend their time. Instead of asking them to do more, we should ask, “Do more of what …and why?”

Our current system is based on assumptions and technologies that are outdated and interfere with the delivery of modern health care. Three problems are clear:

• Physicians in the United States must provide exhaustive documentation to justify their services. No other health system in the world imposes such onerous rules.

• Health IT systems are designed primarily to support tedious billing documentation rather than clinical care. For practicing physicians, this issue tops the list of frustrations.

• Payers and other advocates have promoted different measures and incentives, leaving both physicians and patients searching for a single, meaningful quality agenda. That goal remains elusive, trapping physicians in many time-consuming quality tasks of dubious value.

These three problems have forced physicians to perform more tasks that take time away from patient contact. The result is the “ten-minute patient encounter,” during which the physician spends most of the time on a computer to document and bill for the visit.

This contrasts with how other professionals spend their time. Imagine if we expected airline pilots to sell tickets, load the baggage, and fill the fuel tank before flying the plane!

Several innovations would help solve these problems.

1. Modernize healthcare transactions to be efficient and understandable. Documentation has devoured clinical practice. Originally designed to curb costs and prevent fraud, the current system is an obsolete instrument. In businesses such as the credit card industry, electronic algorithms and analytics detect fraudulent behavior. Such technology should replace arcane documentation rules and their toxic effects on clinical practice.

Beyond the documentation problem, the healthcare industry operates an economic system that bewilders patients, providers, and most business experts. Private insurance rules vary widely by plan, location, facility, and provider. If health care were a consumer-based business, it would have been “out of business” long ago.

2. Focus IT on healthcare analytics. The depth and breadth of medical information is growing exponentially. To serve their patients, physicians must process complex data and perform multiple tasks rapidly. Well-designed informatics can save time, reduce errors, and distill information. Sadly, we are far from reaching that goal.

The current health IT systems are heavy on billing and documentation, and light on usability and analytics. While medicine has aspirations for using “Big Data” in patient care, its information systems are poorly prepared to do anything more than print reports and bills. The healthcare industry needs “smart systems” that make medical practice highly reliable, safe, and more efficient.

Outside of health care, new IT solutions are thriving. Patients can purchase a $50 voice recognition device to browse the internet, play music or news, and perform calculations. However, their doctors and hospitals are stuck with expensive billing systems that are clumsy at retrieving and organizing patient information. That embarrassment would end if healthcare IT focused more on patient care instead of billing.

3. Prioritize national quality goals that matter. Our nation needs to justify the assignments it imposes on physicians. The major advances in healthcare quality have been successful because both patients and physicians understood their importance. These advances, such as cardiac prevention, were planned and tested to blend into practice. Physicians will support important quality programs that meet these standards…but not low-impact measures designed in a conference room.

Medicine is the ultimate human service, whose value to the patient is quality time—time spent with the physician. That bond should not be threatened by putting “business” processes ahead of patient care.

If we lose that battle, both patients and their physicians will be casualties in the war to save medical professionalism.

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