The Official Medtipster Blog

www.Medtipster.com Source: www.pwc.com – June 14, 2010

The nation’s employers can expect medical costs to increase by 9% in 2011, a decrease of 0.5% from the 2010 growth rate, according to the annual Behind the Numbers report published today by the PricewaterhouseCoopers LLP (PwC) Health Research Institute. For the first time, the majority of the American workforce is expected to have a health insurance deductible of $400 or more, as more employers return to “indemnity style” cost-sharing by raising out-of-pocket limits, replacing co-pays with co-insurance and adding high-deductible health plans.

The Behind the Numbers report includes findings of the PricewaterhouseCoopers’ Health and Well-Being Touchstone Survey of more than 700 employers from 30 industries, as well as interviews with health plan actuaries and other executives whose companies provide health insurance for 47 million American workers and their families.

Improving wellness programs and increased cost-sharing lead the planned changes employers will make in the benefit plan designs they will offer for next year. According to PricewaterhouseCoopers’ Touchstone research:

• Two-thirds (67%) of companies intend to expand or improve wellness programs inside the US
• 42% intend to increase employee contributions for health insurance coverage.
• 41% intend to increase medical cost-sharing, including higher deductibles and co-pays, while only 26% intend to increase prescription drug cost-sharing.
• More employers are dropping health benefits for retirees. One-third of employers with over 5,000 workers subsidize pre-65 retiree medical coverage, down from 47% in 2009. Only 22% of employers with over 5,000 employees subsidize post-65 retiree medical coverage, down from 37% in 2009.

In 2011, the Behind the Numbers report outlines three primary deflators that will help employers hold down medical costs:

• Employers are moving toward pre-managed care benefit design by increasing deductibles and replacing co-pays with co-insurance. By requiring workers to spend more out-of-pocket at the point of care, employers believe they will rein in utilization of services and drugs. The number of employers using co-insurance for physician visits has nearly doubled, and one-third use co-insurance for brand-name drugs.
• Drug costs are tempered by generics. Insurers are benefitting from the growing use of generic drugs. Drugs representing about $26 billion in annual sales are expected to go off patent in 2011, including the world’s best-selling drug, Lipitor. Generics account for as much as 80% of all prescriptions.
• COBRA costs are expected to return to more normal levels in 2011. COBRA subsidies passed by Congress in 2009 created a 1% increase in the medical cost trend, according to PricewaterhouseCoopers’ analysis. A combination of declining unemployment and expiration of the COBRA subsidies is expected to lead to reduced enrollment in COBRA.

The biggest inflators of the medical trend in 2011 will be in hospital and physician costs, which make up 81% of premium costs. 

• Hospitals shifting costs from Medicare to private payers and employers is seen as the Number One reason for higher medical costs trends. In 2011, Medicare, which is the single largest payer for hospitals, will reduce payment rates to hospitals for the first time after seven years of increases that nearly matched or exceeded inflation increases. Some hospitals that benefitted from higher payments in 2008 and 2009 may be able to manage this type of cut by tapping their reserves. Yet, more are likely to shift more costs to commercial payers during their negotiations.
• Provider consolidation is increasing, which is expected to increase their bargaining power. More physicians are getting out of private practice and joining forces with local hospitals or larger physician groups. The number of physicians involved in mergers or acquisitions in 2009 was 2,910, nearly twice that of 2008. There has been record consolidation activity in 2010, and PricewaterhouseCoopers expects the trend to accelerate in 2011. Payers expect to see more negotiating power and higher prices in the short term, though the benefits of consolidation should create efficiencies that moderate rate increases in the future.
• Spurred by stimulus funding that begins in 2011 and Medicare penalties that begin in 2015, hospitals will invest billions of dollars in certified electronic health record (EHR) systems. While many hospital systems were planning to implement EHRs in the near future, the government’s new regulations dramatically condensed their timelines to invest in technology, IT staff, training and process redesign. Healthcare CIOs surveyed by PwC said they will make their largest investments to meet the new EHR regulations in 2011. In the long term, EHRs are expected to help control costs. 

“For more than 50 years, US employers have used health benefits as a critical part of their compensation package to recruit and retain workers,” said Michael Thompson, principal, Human Resource Services, PricewaterhouseCoopers. “The value of these benefits is becoming an even more visible part of overall compensation as medical costs grow, and, by 2014, health insurance benefits will shift from being a voluntary benefit to an individual mandate, enforced by new tax levies. Companies are now working with their health plan providers for new post-recession, post-health reform strategies to sustain their programs and promote health and well-being as their next competitive advantage.” 

Each year, PricewaterhouseCoopers’ Health Research Institute provides estimates on growth of private medical costs over the next year and what the leading drivers of the trend are expected to be. Insurance companies use medical cost trends to help set health plan premiums by estimating what the same health plan this year would cost in the next year. In turn, employers use the information to make adjustments in benefit plan design to help offset any cost increases. 

“Health reform delivers only a minor impact on the underlying medical cost trends in 2011 and introduces hundreds of changes in the healthcare system designed to reduce costs and improve efficiencies in the long-term,” said Kelly A. Barnes, US health industries leader at PricewaterhouseCoopers. “These changes could bring significant new cost savings opportunities for employers and payers as well as new choices and transparency for workers buying insurance.” 

PricewaterhouseCoopers’ Behind the Numbers report and survey highlights are available at www.pwc.com/us/medicalcosts2011. The full findings of the PricewaterhouseCoopers 2010 Health and Well-being Touchstone survey are available at  www.pwc.com/us/touchstone2010.For more on the details on the implications of health reform, go to http://www.pwc.com/healthreform. 

Methodology

The 2010 Health and Well-Being Touchstone survey was completed in the first quarter of 2010. Survey participants included 700 U.S- based companies across the country from 30 different industries. Companies ranged in size from small employers with fewer than 500 employees to large companies with more than 20,000 employees. 

About PricewaterhouseCoopers’ Health Research Institute (HRI)

PricewaterhouseCoopers’ Health Research Institute (www.pwc.com/hri) is an unparalleled resource for health industry expertise. By providing cutting-edge intelligence, perspective and analysis on issues impacting the health industry, HRI assists executive decision-makers and stakeholders worldwide in navigating their most pressing business challenges. PricewaterhouseCoopers is one of the only firms with a dedicated global healthcare research unit, capitalizing on fact-based research and collaborative exchange among our network of professionals with day-to-day experience in the health industries. 

About PricewaterhouseCoopers’ Health Industries Group

 PricewaterhouseCoopers’ Health Industries Group (www.pwc.com/healthindustries) is a leading advisor to public and private organizations across the health industry, including payers, providers, academic institutions, health sciences, biotech/medical devices, pharmaceutical companies, employers and new non-traditional market participants in the dynamic healthcare space. PricewaterhouseCoopers has a network of more than 4,000 professionals worldwide and 1,200 professionals in the US dedicated to the health industries.

PricewaterhouseCoopers’ Health Industries’ clients include 40 of the top 100 hospitals in the US and 16 of the 18 best hospitals as ranked by US News & World Report; all 20 of the world’s major pharmaceutical companies; all of the top 20 commercial payers in the US; municipal, state and federal government agencies and many of the world’s preeminent medical foundations and associations. Follow PwC Health Industries at http://twitter.com/PwCHealth.

About PricewaterhouseCoopers
PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 163,000 people in 151 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.

“PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP or, as the context requires, the PricewaterhouseCoopers global network or other member firms of the network, each of which is a separate and independent legal entity.

^© 2010 PricewaterhouseCoopers LLP. All rights reserved

 Lisa Stearns
The Hubbell Group, Inc.
Tel: +1 (781) 878 8882
lstearns@hubbellgroup.com

Medtipster Source: www.pharmalive.com; www.vitality.net; www.att.com

Don’t forget to take your meds! The costs of non-adherence are staggering.

Jason A. Klein, Medtipster President

Life is expensive. You work for a living. Your employer offers health insurance. You’re a diabetic. Your doctor prescribes Glucophage (Metformin Hydrochloride). The average monthy cost is roughly $97.00 (or $8.99 for the generic at Rite Aid….Thanks Medtipster.com!).

Now, what happens if you forget to take or refill your medication? That’s easy. Blue Cross & Blue Shield likely saves $97.00. WRONG. The correct answer is: You get sick and the non-adherence to your medication costs on average 100 times more. According to a study published in August by the New England Healthcare Institute, non-adherence costs the U.S. $290 billion in added medical spending each year. Mortality rates are twice as high among diabetes and heart disease patients who don’t take their pills properly, it said.

A Cambridge, Mass.-based startup called Vitality Inc. took note of the New England Healthcare Institute study and is gearing up to offer an extremely innovative solution. Not only that, but they have brought along AT&T, one of the nations largest communications providers, along for the ride. Their solution: A pill bottle cap that keeps track of when and how often it is opened. If not opened according to the pre-programmed clinical specifications, you will be notified via the AT&T network. The cap can also be programmed to notify your spouse, parents, or children. You can run, but you can’t hide! We, at Medtipster, love this innovation. See full press release below:

Medtipster Source: Associated Press / Writer: Matt Gouras

MONTANA GOVERNOR WANTS TO GET DRUGS FROM CANADA

HELENA, Mont. (AP) — Gov. Brian Schweitzer said Thursday that he is seeking federal permission to import cheaper drugs from Canada for use in state insurance programs.

Schweitzer said he thinks the move could chop 40 percent off the $100 million the state spends each year on prescription drugs for Medicaid, the children’s health insurance program, state employees, and inmates at the prison.

We know we can save a lot of money,” Schweitzer said.

The governor said he envisions the state setting up a deal with a Canadian wholesaler that could mail the drugs to local pharmacies on insurance plans paid for by the state. In the case of the prison, the governor said he expects the state would order those directly.

The U.S. Centers for Medicare and Medicaid Services said Thursday it had not yet seen Montana’s request and couldn’t comment.

Schweitzer was first involved in the issue during an unsuccessful U.S. Senate run in 2000, when he made cheap Canadian drugs a cornerstone of his platform and would take busloads of seniors north of the border to buy drugs.

The issue has been debated in Washington, D.C., over the years.

Recently, the U.S. Senate rejected a plan to let Americans import prescription drugs from abroad. Such a change would deprive drug makers of billions of dollars.

Both the pharmaceutical industry and the Obama administration also have argued that such plans would not protect people from potentially dangerous or ineffective drugs – a notion at which Schweitzer and other supporters scoff.

“These are the same drugs from the same places,” Schweitzer said of the Canadian pharmaceuticals.

Schweitzer is asking Health and Human Services Secretary Kathleen Sebelius to exercise authority to certify the drugs to be safe, to waive Medicaid requirements that such funds only be spent within U.S. borders, and to make other allowances.

Schweitzer said he decided to move forward with the idea now because Congress has not solved the problem with health care reform and because the state is desperately looking for ways to cut costs.

“Desperate times make us desperate people,” Schweitzer said.

The governor said he hopes for a waiver within the year.

Many prescriptions are transmitted electronically, however, does this mean your privacy and safety are at risk? Or is this a safer, more secure and more beneficial method of prescribing medications?

With the age of technology and electronic, well, everything, we’re seeing a lot of changes in every day life, and in every day business. We’ve seen newspaper circulations drop, paper mail decrease, and who doesn’t have an email address or a home computer?

Your physician’s office most likely has an electronic version of your medical records by now, instead of the old school manilla folders. If not, trust me, it will happen sooner versus later. There are a lot of benefits to this method, the biggest being saving trees and helping the environment. Let’s take a closer look at how this may affect the one piece of paper you typically walk out the physician’s office door with – a prescription.

E-prescriptions are the same as the hand written prescription, only computer generated by your physician. The electronic prescription is sent directly to the pharmacy of your choice. Privacy has been a key concern for many patients with this change in how prescriptions are handled, however, rest assured that the network (transmitting) between your physician’s computer and your pharmacy is a secured and private route.

E-prescribing is more efficient and is faster in most cases. Most of the time, your prescription arrives at your pharmacy before you leave your doctor’s office. It doesn’t always mean it will be ready for you when you arrive, as sometimes pharmacies are busy or you arrive before the pharmacist has had time to fill the script. But, you won’t be waiting around the pharmacy or having to leave and come back. Plus the risk of errors with traditional hand written prescriptions is almost obsolete with e-prescriptions.

Also, remember that all e-prescriptions meet the requirements of Health Insurance Portability and Accountability Act (HIPAA). Your medical history has always contained the record of your prescription, and it being electronic or hand written makes no difference. All medical and prescription information is protected by federal and state laws.

If you have questions about your prescription, your physician or pharmacist will be able to address your concerns. Specific questions about e-prescriptions can be answered by either professional as well. Remember if you’re unsure which pharmacy has your prescription at the lowest cost available, tell your exit nurse at your physician’s office to use Medtipster.com to find the pharmacy to transmit your e-prescription.

If you’re searching for savings on brand name prescriptions, our user friendly and searchable database of coupons come straight from the manufacturer.

Many people have trouble affording their prescriptions, especially those without health insurance. In fact, one single prescription for a 30-day supply can cost hundreds or even thousands of dollars. I’ve heard stories of people having to choose between their medications and groceries, and it breaks my heart to think of such dilemma. No one should have to make that choice!

There are ways you can save significant amounts of money on your prescriptions, and I’m not just shouting Medtipster.com here. The growth of internet coupons has exploded over the last few years, to include everything you can imagine – and even, yes, prescriptions. You may already be familiar with our database, which locates the $4 generic program for your specific prescription at your local pharmacy. However, beyond that, we’ve done our homework on certain pharmacy’s required memberships, programs, and rates where necessary. The information is available to everyone right here, at no charge.

If your prescription is not available as a generic, or not available at a pharmacy near you, we have options in store for you! Drug makers often have prescription assistance programs, though in most cases, it is difficult to maneuver through the steps to get the help you need. Here at Medtipster, we understand that frustration and came up with a simple solution to the problem.

Medtispter.com will be implementing a new coupon database and assistance program. The endless internet search through website hoaxes and scams is over! Have you ever tried searching online for “prescription drug coupons?” The results can be a bit confusing, and can stray quite a bit away from what you were really looking to find.

We are working very hard to collect the drug manufacturer’s coupons at large, to create a database that is easy to search through and to find your specific prescription coupon. In many cases, these will save you hundreds of dollars a month! In fact, if your prescription is not available as a generic equivalent, or not available at a pharmacy near you, one click of the button to “locate coupon” will serve as relief, as well as the option to find therapeutic alternatives.