The pharmaceutical industry is facing new limits on payments to prescribers in New Jersey. Earlier this month the state’s Division of Consumer Affairs finalized sweeping new rules prohibiting some types of payments and capping others. New Jersey now joins the ranks of other states, like California and Massachusetts, with specific payment prohibitions between manufacturers and prescribers. The new rules place the burden of compliance on prescribers licensed in New Jersey, but manufacturers should be fluent in these requirements. We expect engagement and collaboration with New Jersey prescribers to be impacted, as these rules are clearly designed to be a disincentive to financial arrangements between manufacturers and prescribers. How deeply this impacts ongoing and new collaborations with prescribers is yet to be seen, as manufacturers do rely on prescribers for contributions to product design, product feasibility in clinical workflow, and patient expectations. Below is a summary of the key aspects of the new rules, along with tables to assist in identifying how certain payments are affected. Continue Reading A Guide to New Jersey’s New Limits on Pharmaceutical Industry Payments to Prescribers
Last week, ML Strategies released an Advisory providing a comprehensive review of the sweeping health care legislation recently released by the Massachusetts Senate. The Advisory summarizes the notable provisions contained in the bill, including, among other things, how to handle the rising cost of prescription drugs, hospital reimbursement rates, changes to MassHealth (the Massachusetts Medicaid agency), and commercial insurance market tiering. The bill represents the latest in a series of proposals lawmakers and the Baker administration have made this year aimed at lowering health care costs and improving quality of care. Given the uncertain future of health care at the national level, all eyes will be on Massachusetts as it grapples with these important issues.
The pharmaceutical industry is facing the prospect of a rapidly evolving landscape, one that challenges its regulatory understanding and business model. States from Vermont to California are proposing transparency and price capping proposals through the state legislature while candidates for federal office – from the presidency down to congressional races – are proposing or endorsing policies which could drastically alter the status quo. With so much uncertainty in the political space as the 2016 election cycle heats up, Mintz Levin and ML Strategies brought together stakeholders from across the industry last month to shed light on the debate over drug pricing and how regulatory initiatives and legislative proposals frame the issue moving forward. Continue Reading Mintz Levin/ML Strategies Pharmacy Summit White Paper Highlights Drug Development Process
Just as the Centers for Medicare & Medicaid Services (CMS) began holding federal health care plans accountable for their provider network transparency obligations, the New Jersey legislature stalled in its bid to pass a law that would require hospitals and physicians to disclose whether they are in or out-of-network with a patient’s insurance plan before providing treatment. Both laws are intended to curb the exorbitant – and often surprising – costs associated with procedures provided by out-of-network providers.
Under a new rule that went into effect on January 1, 2016, CMS can fine Medicare Advantage (MA) plans up to $25,000 per day per beneficiary, and qualified health plans (QHPs) on the federal exchange up to $100 per day per beneficiary, for inaccuracies in their provider directories. In addition to accurately listing participating providers, which the QHPs and MA plans are required to verify and update quarterly and monthly, respectively, the plans must also identify which providers are accepting new patients, the provider’s location, contact information, medical group, specialty and any institutional affiliations. CMS notified QHPs and MA plans of the new rule in separate February 2015 letters.
State regulation of provider directories is not new – more than half the states have such guidelines, including New Jersey. Indeed, New Jersey has one of the more stringent provider directory rules. For example, regulations require insurance carriers to update their electronic directories within 20 days after receiving confirmation from a provider that the existing information is inaccurate, and they must affirmatively confirm the participation of any provider who has not submitted a claim for more than 12 months. In enacting these rules, the New Jersey Department of Banking and Insurance stated it was “essential for consumers to have reliable and current information regarding the healthcare providers participating in a particular network at any given time … and [to] establish enforceable standards for network directories in order for directories to be more reliable and less likely to mislead consumers contemplating joining a network-based health benefits plan or when they attempt to obtain in-network healthcare services and supplies.” Continue Reading CMS Takes Action Against Network Transparency While New Jersey Legislation Hits a Snag
As a veteran of the AWP litigation era, I am struck by the recent state efforts to legislate transparency into pharmaceutical pricing. Multiple states have introduced bills that would require pharmaceutical manufacturers to produce information to justify the sales price for their drugs. But the idea that pharmaceutical manufacturers are unilaterally responsible for the costs borne by citizens of these states ignores the tangled web of policies and processes that makes up drug pricing and reimbursement in the United States. State legislators may want to examine the relatively recent history of state Average Wholesale Price (AWP) litigation, and each of their state’s response to the pricing transparency mandates incorporated into the early AWP case settlements, before moving forward to mandate transparency from just one player in the process. Continue Reading State Pharmaceutical Pricing Disclosure Laws: Old Story, New Refrain
The Centers for Medicare & Medicaid Services (CMS) recently added to the trend toward greater health care data transparency by releasing data about the prescription drugs that physicians and other health care providers prescribed in 2013 under the Medicare Part D Prescription Drug Program. CMS’s press release touted the data as “part of the Obama Administration’s efforts to make our healthcare system more transparent, affordable, and accountable.” Following the Physician Payments Sunshine Act, which makes public the financial arrangements that pharmaceutical and medical device manufacturers have with physicians and teaching hospitals through the “Open Payments” program, and the release of 2012 physician Medicare Part B fee-for-service data, which my colleagues discussed in a previous post, the 2013 Part D data adds to the growing universe of publicly available information about the health care system. Continue Reading Medicare Part D Data Release Continues Transparency Trend
Written by: Thomas S. Crane
On January 17, 2014, the Centers for Medicare & Medicaid Services (CMS) announced that it will release Medicare expenditure data on specific physicians under the Freedom of Information Act (FOIA). This new “transparency” policy has been in the works for several months and is a watershed event with respect to the data informatics that will soon be available to interested parties.
Non-disclosure of physician-specific Medicare payment information dates back to the late 1970s when a court permanently enjoined the Department of Health and Human Services (HHS) from releasing such information after concluding that physicians have a compelling privacy interest in preventing the disclosure of such data. In 1980 HHS adopted a policy consistent with this injunction. However, on May 31, 2013, the district court vacated this injunction.
The new policy permits disclosure of individual physician payment information under FOIA Exemption 6 and may be seen as just a small first step towards transparency. CMS states that it will make “case-by-case determinations” on disclosure and will “weigh the balance between the privacy interest of individual physicians and the public interest in disclosure of such information.” These comments indicate that CMS intends to proceed cautiously at the outset.
Physician payment information can be of significant value in a number of ways. The new health care environment created by the Affordable Care Act mandates that providers better understand and take into account the health care costs associated with the services they provide. While information on Medicare payments to physicians is important, the more valuable information results from connecting this data to the wider health care system costs for which physicians are responsible through their ordering and referral practices. For example, just this month CMS proposed changing its disclosure practices under the Medicare Part D program for prescriber data found in the prescription drug event (PDE) data base. CMS is proposing to release to external entities “unencrypted prescriber. . . identifiers contained in PDE records.” In describing the reasons for this change, CMS stated that, “The agency has an important role to play in supporting opportunities to accelerate the transition to a data-driven and information-based health care delivery system in this country.”
Wider uses of such data can easily be imagined. For example, we can expect that various stakeholders will seek access to these data sources to further link them to manufacturer disclosure information made available later this year under the Sunshine Act. Moreover, such linked data sources will likely be used in health care enforcement, particularly by relators bringing cases under the False Claims Act and by counsel defending these cases. Finally, these data sources will be enormously helpful in a variety of health system research contexts.