Healthcare Economist

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Should hospitals pay for housing for ED frequent flyers? Posted: 22 Jun 2021 06:16 PM PDT That is one approach being explored in Philadelphia according to an article in Kaiser Health News. Using funding from Temple University, two Pennsylvania Medicaid health plans, and some grant funding, the Template University Health System: …launched a two-year program last year to help 25 homeless Medicaid patients who frequently use its emergency room and other ERs in the city by providing them free housing, and caseworkers to help them access other health and social services. It helps them furnish their apartments, connects them to healthy delivered meals and assists with applications for income assistance such as Social Security. To qualify, participants had to have used the ER at least four times in the previous year and had at least $10,000 in medical claims that year. Temple has seen promising results when comparing patients' experiences before the study to the first five months they were all housed. In that time, the participants' average number of monthly ER visits fell 75% and inpatient hospital admissions dropped 79%. At the same time, their use of outpatient services jumped by 50% — an indication that patients are seeking more appropriate and lower-cost settings for care. The program is not cheap, however. It cost $28,000 per person. Nevertheless, according to a Kaiser Family Foundation study last fall, over half of states are implementing or expanding Medicaid programs that address social determinants of health. Not all interventions addressing social determinents of health have the anticipated impact. Consider the free rideshare program from another Philadelphia university and my alma mater, the University of Pennsylvania: When doctors at a primary care clinic here noticed many of its poorest patients were failing to show up for appointments, they hoped giving out free rides would help. But the one-time complimentary ride didn't reduce these patients' 36% no-show rate at the University of Pennsylvania Health System clinics… Many of the patients did not take advantage of the ride because they were either saving it for a more important medical appointment or preferred their regular travel method, such as catching a ride from a friend, a subsequent study found. In short, addressing social determinants of health is a laudable goal. Finding the most cost-effective ways to achieve these goals, however, can be challenging in practice.

GAO report on prescription drug advertising Posted: 21 Jun 2021 05:13 PM PDT Medicare beneficiaries are largely elderly individuals, many of whom suffer from a variety of health conditions. Pharmaceutical manufacturers want these patients and their physicians to be aware of new medical treatments that become available (i.e., new approvals) as well as new uses for existing drugs (i.e., new FDA indications). Direct-to-consumer advertising (DTCA) is one way that pharmaceutical firms make consumers aware of these new treatments. Drug company spending on DTCA increased significantly in recent years, from $1 billion in 1997 to $6 billion in 2016. The Government Accountability Office (GAO) provides some details on drug advertising in their 2021 report Medicare Spending on Drugs with Direct-to-Consumer Advertising. The report answers 3 questions: (i) how much did drug manufacturers spend on DTCA for prescription drugs? (ii) how much did Medicare spend on prescription drugs that used DTCA? and (iii) how did drug manufacturer DTCA spending, Medicare spending, and Medicare use for selected drugs change over the last decade? A few highlights: Drug manufacturers spent $17.8 billion on direct-to-consumer advertising (DTCA) for 553 drugs from 2016 through 2018…Almost half of this spending was for three therapeutic categories of drugs that treat chronic medical conditions, such as arthritis, diabetes, and depression. GAO also found that nearly all DTCA spending was on brand-name drugs, with about two-thirds concentrated on 39 drugs… …drug television advertising comprised about 76 percent of total DTCA spending ($13.4 billion of the $17.8 billion)…This share was followed by spending on magazine advertisements ($3.6 billion), digital advertisements ($603 million), and advertisements in other types of media, such as newspapers and movie theaters ($113 million). Data on DTCA spending came from Nielsen Media and information on each drug (e.g., approval year, indication, brand vs. generic, biologic vs. small molecule) came from FDA approvals. DTCA spending between 2016 and 2018 was highest for Humira, at $1.4 billion. Spending for neuropathic pain drug Lyrica was $913 million and spending for type 2 diabetes biologic Trulicity was $655 million. The report also finds that Medicare and its beneficiaries spent $324 billion on prescription drugs that were advertised (58% of Medicare drug spending) compared to $236 billion (42%) on drugs that did not have any DTCA expenditures. Unsurprisingly, DTCA advertising rose when a drug received a new indication and fell when generic competitors entered the market. In fact the GAO reports: While these examples illustrate how consumer advertising may contribute to increased Medicare use, events such as FDA approval for additional indications, would likely have led to increases in drug use on their own (i.e., without consumer advertising). A key question is, did increased advertising lead to increased use of these medications? The answer is almost certainly yes (why would drug companies advertise if they didn’t work?), but it isn’t the only or likely even the primary factor. Beyond DTCA spending, stakeholders we interviewed cited a number of other factors that likely contribute to the overall use of drugs and drug spending, including in Medicare. These factors included doctors' prescribing decisions, health plan formulary controls, a drug's therapeutic benefit, and manufacturer spending on drug promotions directed to doctors. Some stakeholders said that, in their view, DTCA spending likely contributes less to overall drug use and spending compared to these other factors. For example, several stakeholders explained that while DTCA may encourage and help consumers to have informed conversations about their medical conditions and treatment options with health care providers, it is the provider's judgment about the medical condition and therapeutic benefit of that drug that ultimately determines if the drug is prescribed to the patient Additionally, there is some reverse causality to consider as well. DTCA spending is likely not allocated randomly across drugs. Blockbuster breakthroughs like Humira (for immunologic conditions) and Keytruda (to treat a variety of cancers) are much more likely to have high DTCA spending in large part because they represented a large clinical improvements over the previous standard of care. Drugs that offer only marginal clinical benefits are likely to have much lower DTCA. Below are the top drugs in terms of Part B, Part D and DTCA spending. Source: https://www.gao.gov/assets/gao-21-380.pdf

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