2017 In Review, Part 2

By December 28, 2017Commentary

Today a little more focus on the actual delivery of health care and health care treatments.  Drug costs, especially specialty medications, are an ongoing source of concern.  Large price increases continue to occur, with little rationale.  No clear action appears to be forthcoming from the federal government, although a couple of states have taken minor steps to limit the impact of price rises.  The major product trend, however, to keep an eye on is the emergence of approved cell therapies.  There are hundreds of these in the pipeline and the FDA has now approved a couple.  If you thought specialty drugs could be expensive, your head will spin at cell therapy pricing.  A million dollars a year is discussed for some, hundreds of thousands for others.  Populations are generally small, but for some cancers they are larger.  Small or large, there is really no way payers can absorb this cost.  The next couple of years will be very telling in how the system is going to approach this spending.

We also saw the shift from inpatient to outpatient procedures and treatments continue.  At-risk payments and value-based payments grew, although CMS withdrew some mandatory bundled payments.  The focus on emphasizing primary care as the source for coordinating and managing utilization and costs continued as well, and several acquisitions, such as UHG’s acquisition of DaVita’s provider groups, were designed to capitalize on this trend.  While “digital” health still gets a lot of hype, there is no significant evidence that it is having any impact on quality or costs.  Telemedicine growth has been frustratingly slow.  A couple of major guideline revisions, especially in regard to hypertension, may result in over-diagnosis and treatment.

Health care is often said to have three major concerns–access, cost and quality.  While cost growth overall was muted, it continues to exceed GDP or personal income growth, thus stressing consumers and payers.  And inflationary fears may yet lead to faster rises in spending.  Access has improved by some measures, but low reimbursements in Medicaid have caused shortages in provider capacity, especially in low-income areas.  And while quality measure performance looks better, it is not certain that the actual health of the nation is better.  It was just reported that life expectancy dropped for the year, due to opioid and other problems.  A lot of work to do.  Keep us all busy in 2018!!

Kevin Roche

Author Kevin Roche

The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry through Roche Consulting, LLC. Mr. Roche is available to assist health care companies through consulting arrangements and may be reached at khroche@healthy-skeptic.com.

More posts by Kevin Roche

Leave a Reply