Secular Trends in the Cost of Immunosuppressants after Solid Organ Transplantation in the United States

BACKGROUND AND OBJECTIVES

Immunosuppressive medications are critical for maintenance of graft function in transplant recipients but can represent a substantial financial burden to patients and their insurance carriers.

DESIGN, SETTING, PARTICIPANTS, & MEASUREMENTS

To determine whether availability of generic immunosuppressive medications starting in 2009 may have alleviated some of that burden, we used Medicare Part D prescription drug events between 2008 and 2013 to estimate the average annualized per-patient payments made by patients and Medicare in a large national sample of kidney, liver, and heart transplant recipients. Repeated measures linear regression was used to determine changes in payments over the study period.

RESULTS

Medicare Part D payments for two commonly used immunosuppressive medications, tacrolimus and mycophenolic acid (including mycophenolate mofetil and mycophenolate sodium), decreased overall by 48%-67% across organs and drugs from 2008 to 2013, reflecting decreasing payments for brand and generic tacrolimus (21%-54%), and generic mycophenolate (72%-74%). Low-income subsidy payments, which are additional payments made under Medicare Part D, also decreased during the study period. Out-of-pocket payments by patients who did not receive the low-income subsidy decreased by more than those who did receive the low-income subsidy (63%-79% versus 24%-44%).

CONCLUSIONS

The decline in payments by Medicare Part D and by transplant recipients for tacrolimus and mycophenolate between 2008 and 2013 suggests that the introduction of generic immunosuppressants during this period has resulted in substantial cost savings to Medicare and to patients, largely reflecting the transition from brand to generic products.

A Financial Analysis of New York City Start-up Health Plans and Reasons for Their Losses

PURPOSE

Using New York City as an example, this research explores reasons for the consistently poor financial performance of three start-up health plans (Health Republic, CareConnect, and Oscar) while other health plans have performed relatively well in the same market.

DESIGN AND METHODS

This study compiles insurer data from financial years 2014 through 2016, submitted to the New York State Department of Financial Services as part of the rate-review process, including premium revenue, claims cost, risk adjustment, administrative costs, net income, and premium. The financial data were used to create a novel metric, adjusted net income, that evaluates the financial performance of an insurer excluding risk adjustment and assuming a market average administrative cost. Descriptive statistics were used to compare the performance of start-up plans, commercial plans, and Medicaid plans in the ACA exchange market.

RESULTS

Premiums for start-up plans were within 9% of median silver premiums yet adjusted net income was negative (-$190 PMPM) for all three start-ups while it is positive (+$27 PMPM) for the non-start-ups. The difference in adjusted net incomes shows that poor financial performance of start-ups was due to claims costs, not high administrative costs and poor performance in risk adjustment.

CONCLUSION

The consistent financial losses by New York City start-ups is driven by higher-cost provider contracts for the start-ups relative to competitors.

Insurers on a Shopping Spree For All Sorts of Providers

UnitedHealth Group, Humana, Centene, and Anthem have announced billions of dollars of deals to acquire primary care practices, hospice providers, and home health care companies. The insurers' foray into provider territory comes as the traditional contours of American health care are in flux.

PBMs: Maligned as Middlemen, They're Hearing Wedding Bells

The PBM industry is under fire these days for what critics call its lack of transparency and its knotty contract language, secretive pricing schemes, and an inscrutable assortment of rebates, discounts, side deals, and administrative fees. Some see partnerships with insurers and retailers as a possible solution. Opponents see a risk of even higher drug prices.

Consolidation in the Dialysis Industry, Patient Choice, and Local Market Competition

The Medicare program insures >80% of patients with ESRD in the United States. An emphasis on reducing outpatient dialysis costs has motivated consolidation among dialysis providers, with two for-profit corporations now providing dialysis for >70% of patients. It is unknown whether industry consolidation has affected patients' ability to choose among competing dialysis providers. We identified patients receiving in-center hemodialysis at the start of 2001 and 2011 from the national ESRD registry and ascertained dialysis facility ownership. For each hospital service area, we determined the maximum distance within which 90% of patients traveled to receive dialysis in 2001. We compared the numbers of competing dialysis providers within that same distance between 2001 and 2011. Additionally, we examined the Herfindahl-Hirschman Index, a metric of market concentration ranging from near zero (perfect competition) to one (monopoly) for each hospital service area. Between 2001 and 2011, the number of different uniquely owned competing providers decreased 8%. However, increased facility entry into markets to meet rising demand for care offset the effect of provider consolidation on the number of choices available to patients. The number of dialysis facilities in the United States increased by 54%, and patients experienced an average 10% increase in the number of competing proximate facilities from which they could choose to receive dialysis (P<0.001). Local markets were highly concentrated in both 2001 and 2011 (mean Herfindahl-Hirschman Index =0.46; SD=0.2 for both years), but overall market concentration did not materially change. In summary, a decade of consolidation in the United States dialysis industry did not (on average) limit patient choice or result in more concentrated local markets. However, because dialysis markets remained highly concentrated, it will be important to understand whether market competition affects prices paid by private insurers, access to dialysis care, quality of care, and associated health outcomes.