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High-Cost Drugs: A Dark Cloud Hanging Over HIT Integration

"Many Medicaid plans are seeing their surplus gobbled up by one drug. That’s going to have an impact on IT budgets. It’s inevitable.”

- A number of accomplishments point to 2015 as having been a banner year for health IT integration. Consider, for instance, gains in EHR adoption by providers in underserved settings, the nearly glitch-free transition to ICD-10 from a claims processing perspective, and the emergence of FHIR services in production environments to support clinical services.

High-cost drugs could have an impact on IT budgets in healthcare organizations.

But it’s not all clear skies ahead. A whirlwind may be approaching on an indirect front.

“What really concerns me is a risk that the industry is going to be forced to disinvest to some degree in innovation because of a fundamental economic challenge that’s coming toward us in the form of very high-cost drugs,” Frank Ingari, CEO of payer-provider network NaviNet, told HealthITInteroperability.

One may counter that health IT will remain indispensable as a strategic cost-control element in chronic disease treatment and prevention through population health management and care coordination initiatives. The recently reported decline in national diabetes cases points to progress in that area.

Nonetheless, there’s still cause for caution, according to Ingari.

“It seems like for every yard we gain on that side, we’re losing a yard or more with these extremely high-cost drugs. And with the implications of pharma being so unregulated on the price side inside our national borders, that’s really creating stress. I know the Medicaid plans have staggered under the cost of Sovaldi, for example. Many Medicaid plans are seeing their entire surplus for the year gobbled up by one drug — and that’s going to have an impact on IT budgets. It’s inevitable.”

Earlier this year, in a commentary published by The Hill, Robert Henkel, CEO of Ascension Health, took a similar stance. He called out blood pressure medication Nitropress and heart rhythm treatment Isuprel — drugs that combined to increase Ascension’s costs by more than $8 million in the span of one year. The price of Nitropress had skyrocketed 525 percent, while the price of Isuprel spiked 212 percent. Henkel added that neither drug was close to going off-patent, which meant no availability of lower-cost generic alternatives.

“These drastic price increases threaten the economic wellbeing of hospitals and the safety of patients. They squeeze the hospitals’ ability to invest in making patient care even safer. Instead of using our already stretched resources to expand access and better serve our patients, Ascension will pay millions of dollars in unexpected drug costs in 2015 alone,” Henkel wrote. “Even a major purchaser like Ascension, with more than 130 hospitals across the country, cannot indefinitely continue to absorb these often unexpected and arbitrary price hikes.”

Overall, spending on prescription drugs in the U.S. grew by 12 percent in 2014, faster than any year since 2002.

Perhaps a ray of light in the gloomy outlook is that the Centers for Medicare and Medicaid Services (CMS), one of the largest purchasers of prescription drugs in the country, appears to be engaged in increasing transparency and addressing the affordability of medications. On Dec. 21, the agency unveiled the online Medicare Drug Spending Dashboard, which identifies the most costly drugs for Medicare Parts B and D.

“[By] sharing this information and allowing people to analyze the data, we can increase the knowledge around drug spending and support efforts that are evaluating whether public dollars are being spent most effectively,” wrote Acting CMS Administrator Andy Slavitt and CMS Chief Data Officer Niall Brennan in The CMS Blog.

Image credit: Creative Commons license

 

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