Subject: POLITICO Pulse, presented by PhRMA: For kids, prices rise while utilization falls — Sanders attacks pharma over California fight — Shareholders push Aetna, Anthem over political spending
From: POLITICO Pulse <[email-masked]>
To: <[email-masked]>
Date: Mon, 16 May 2016 08:03:26 -0600

By Dan Diamond | 05/16/2016 10:00 AM EDT

McKinsey reveals how much insurers are losing in the ACA marketplaces, and Bernie Sanders challenges Hillary Clinton and Donald Trump to join him in supporting California's drug price legislation. But first: New data on children's health care patterns.

FOR KIDS, PRICES RISE WHILE UTILIZATION FALLS - That's according to a report out this morning from the Health Care Cost Institute, which tracked trends for children ages 18 and younger and found a surprising drop in their use of health care in 2014.

Overall, per capita spending on health care for kids who were covered by employer-sponsored plans grew by about 5 percent per year between 2010 and 2014. At the same time, researchers flagged a decline in utilization, hospital admissions and even prescription drugs, a trend that they say needs more scrutiny.

Key drivers of rising cost growth
The average price per filled day for brand prescriptions for children more than doubled - from $7 in 2010 to $16 in 2014

The average price of a surgical admission for a child grew by more than 50 percent - from $35,423 in 2010 to $53,372 in 2014 

Two signs of declining utilization
The number of emergency visits per 1,000 children fell from 181 in 2010 to 177 visits in 2014

The number of doctor visits for children slightly declined between 2013 and 2014

Read the report: http://go.politicoemail.com/?qs=79e883dffb61ed841127fa88db0e1e94994445ab65343160332c35c71761b3ea

SANDERS ATTACKS PHARMA FOR CALIFORNIA FIGHT - The Vermont senator on Saturday blasted pharmaceutical companies for bankrolling opposition to a California ballot initiative, and called on Hillary Clinton and Donald Trump to join him in supporting the California Drug Price Relief Act.

"The pharmaceutical industry charges the American people, by far, the highest prices in the world for prescription drugs and millions of people are unable to afford the medicine they need," Bernie Sanders said in a speech in Kentucky. "Meanwhile, the top five major drug companies last year made almost $50 billion in profits. Enough is enough."

The pharmaceutical industry is expected to spend more than $100 million to fight the California proposition.

- Sanders thinks McConnell should wear pharma logo. Sanders said that if the Senate Majority Leader succeeds in having unlimited corporate campaign spending, senators should be forced to wear jackets like NASCAR drivers wear. "Hey, I'm proud I'm sponsored by Exxon Mobile," mocked Sanders. "I'm sponsored by the pharmaceutical industry."

WELCOME TO MONDAY PULSE - Where we hope you didn't attempt to fly out of Midway this weekend. Tips to [email-masked] or @ddiamond on Twitter.

SHAREHOLDERS PUSH AETNA, ANTHEM TO DIVULGE POLITICAL SPENDING - Both insurance companies already disclose what they spend on lobbying, but activist shareholders want them to share what they spend on "dark money" too, Modern Healthcare's Bob Herman reports. Aetna, for instance, accidentally revealed in 2012 that it funneled millions of dollars to the American Action Network, which opposed the Affordable Care Act and supported conservative candidates.

The issue is expected to get more attention at both insurers' shareholder meetings this week, with proposed resolutions that would require them to disclose of all direct and indirect political spending. http://go.politicoemail.com/?qs=79e883dffb61ed8460545d5f35ad8d9880c5e04f8a4850142584ffad692b436d 

NYT: OBAMACARE PLANS AREN'T COMPREHENSIVE - That's according to a cover story in the Sunday Review, which suggests that the ACA exchanges' strong reliance on narrow-network plans has created access problems and resentments among customers.

"Many say they feel as if they have become second-class patients," Elizabeth Rosenthal writes. And "compared with the insurance that companies offer their employees, [ACA] plans provide less coverage away from patients' home states, require higher patient outlays for medicines and include a more limited number of doctors and hospitals." http://go.politicoemail.com/?qs=79e883dffb61ed842699e3b9ba07f964849846a47a0514d5277e15e65d3d564d 

Is it as bad as the New York Times says? Stephen Zuckerman doesn't think so. The Urban Institute scholar points to his research that says access to care under ACA exchange plans and traditional employer-sponsored plans are similar: http://go.politicoemail.com/?qs=79e883dffb61ed848d4b07f65abac6b992e3043d458d95e088b82edc7c5c6e42 

A 9 PERCENT LOSS - AT LEAST. That's about how much the insurance industry collectively lost in the individual market in the ACA exchanges last year, according to a new McKinsey analysis. 

The two biggest drivers of losses:
. Higher year-over-year medical loss ratios 
. Lower reinsurance payments

Despite the collective losses, McKinsey doesn't see the risk of a so-called death spiral as long as the government offers subsidies to shoppers who fall below 400 percent of the federal poverty line. "Given the unique regulatory conditions of this market, the key determinants of its stability are not the traditional factors (risk and cost of care for this segment), but rather the ongoing subsidy payments," the report concludes. 

See the report: http://go.politicoemail.com/?qs=79e883dffb61ed843f3aa50c9154a43ab76c6d70b5bf5b62201e33dc286820e6 

ALASKA, ALABAMA MAY HAVE JUST ONE INSURER IN ACA EXCHANGE - And so will a number of regions of other states, including Kentucky, Arizona and Oklahoma. 

That's based on an ongoing count from the Kaiser Family Foundation, which is keeping a county-by-county track of insurers as they pull out of the marketplaces. What those counties have in common: 70 percent have populations that are mostly rural, KFF's Cynthia Cox told the Wall Street Journal. 

More: http://go.politicoemail.com/?qs=79e883dffb61ed8498a13b595f3fa8b7549b25e48d52089e75862ddf2a686dca 

** A message from PhRMA: PhRMA member companies invested $58.8 billion in research and development in 2015, up 10.3 percent from 2014, new data show. For more than 30 years, the U.S. biopharmaceutical industry has led the world in the development of medicines, and PhRMA member companies continue to be at the forefront. Learn more. **

WELLNESS RULES ARE COMING. BUT DO THE PROGRAMS EVEN WORK WELL? - The Obama administration will issue final rules this week to clarify when wellness programs go too far by establishing how much employees can be penalized for not participating, POLITICO's Marianne LeVine writes. 

But there's limited evidence that workplace wellness programs accomplish their goals; employees often ignore them and there doesn't appear to be much of a health care payoff. More: http://go.politicoemail.com/?qs=79e883dffb61ed84c9522bf651eee2de3c5e61166d86d9bbe44b04ae94758168 

POLITICO Pro Health Care Report - Reaching the Tipping Point: Health Care Delivery Reform: A conversation about regional variation in health care delivery system reform. How are different parts of the country responding to the push for value-based payment in the public and private sectors? Why do delivery and payment reforms take root in some markets but not others? 

I'll be moderating this with POLITICO's Executive Editor for Health Care, Joanne Kenen. Thursday, May 19 - Doors at 8:00 a.m.; W Hotel - 515 15th St NW. RSVP: http://go.politicoemail.com/?qs=79e883dffb61ed84418bd793c61dbceb9704d65e777b19ac723a9b9924538e24

FTC: HEALTH CARE COMPETITION REMAINS TOP CONCERN - The commission is out with updates of its enforcement actions and policies in the health care sector, just days after suffering its first loss in a provider challenge in nearly a decade: http://go.politicoemail.com/?qs=79e883dffb61ed84b6aeea80cf0fbab1a47b91213895da65e2cfe6a0c1a1d0a1

CMS LEADER: INDEPENDENT PHYSICIANS REMAIN KEY CONCERN - Andy Slavitt says there are "lots of important questions" about doctors' ability to stay independent, and the CMS acting administrator this weekend teased out some of the key challenges and opportunities on Twitter. 

Read Slavitt's tweets: http://go.politicoemail.com/?qs=79e883dffb61ed84cd5a30c09abe2a5f2065bd807af7f780a056cc18816a5946 

ICYMI: Slavitt on how CMS is working to recapture doctors' hearts and minds. The head of CMS recently sat down with POLITICO's new "Pulse Check" podcast to discuss how Medicare has lost support among physicians and how the agency is seeking to win doctors back over with new initiatives.

Listen to the podcast: http://go.politicoemail.com/?qs=79e883dffb61ed8465ae22a849484aa71f3e9db779078c99c59e8dda20989341 Slavitt's comments on doctors start at the 46:45 mark.

MODERATE SENATE DEMS WANT CHANGES TO PART B DEMO - They're asking CMS to change the size and scope of the demo and make alterations to ensure that seniors' care is protected, Sen. Heidi Heitkamp and colleagues wrote to Slavitt on Friday. The Democrats also raised concerns about patient access and rural doctors.

See the letter: http://go.politicoemail.com/?qs=79e883dffb61ed84db02a1e5ae876d83c7ea5ff9ad7400db3078ae1c37b62b5d 

NEW YORK LAWMAKERS PUSH AID-IN-DYING LEGISLATION - The legislation would require two physicians to confirm that an individual has a terminal illness and is likely to die within six months, our POLITICO New York colleagues report. Patients would then have to be referred to a mental health professional for an evaluation, and two witnesses would have to attest that the request is voluntary. More in State Week: http://go.politicoemail.com/?qs=79e883dffb61ed846170489b512826c2962738d60def10bd3d1bea1662953b65

AN OLD STRATEGY TO FIGHT CANCER IS NEW AGAIN: STARVE IT TO DEATH - The New York Times Magazine on Sunday profiled some of the latest research into fighting cancer, including stories on targeted therapies and why some patients respond exceptionally well to clinical trials.

One article dealt with the "Warburg effect" - the discovery in 1923 that cancer cells rapidly consume glucose - which was once mainstream science, but was mostly abandoned in the 1950s as scientists began to make more nuanced genetic breakthroughs. However, researchers are now investigating whether metabolism could be the "Achilles' heel" of fighting cancer, essentially starving cancer cells of the nutrients they need to grow.

See the story: http://go.politicoemail.com/?qs=79e883dffb61ed849902b0a9cb2cdba7f30b15e8e890f890e0c5d69af533b552 
Read the issue: http://go.politicoemail.com/?qs=79e883dffb61ed84e4959fab9cb7f4341373214f2863973698dc76d732744da5 

SPOTTED AT THE WHITE HOUSE'S NORDIC STATE DINNER ON FRIDAY ... HHS Secretary Sylvia Mathews Burwell, RWJF head Risa Lavizzo-Mourey and Planned Parenthood head Cecile Richards, among other guests.

WHAT WE'RE READING

In Health Affairs' Narrative Matters: The connection between poverty and asthma attacks in a Chicago community. http://go.politicoemail.com/?qs=79e883dffb61ed84691d61a2051bb60ad00c075f8b2e3985093ca302ae02a2c1 

Some neuroscientists and philosophers agree: The act of seeking gives our lives meaning, Quartz reports. http://go.politicoemail.com/?qs=79e883dffb61ed84a40e7f2fd61464967dd900786d3bd76688e1ab28b6ba24bf 

Following up on his critique of MACRA, John Halamka explains how to move from fee-for-service to paying for value: http://go.politicoemail.com/?qs=79e883dffb61ed84fc32e351311d379dfa4cfefa1801713289fbd4bf0787f6c7 

Dermatologists using telemedicine missed some key diagnoses, according to a new secret-shopping study: http://go.politicoemail.com/?qs=79e883dffb61ed8446a4bb0ffa7ebdae570c02c9824a5c8a58ac725a780dd081 

Katherine Hobson disagrees with Theranos' central claim: We don't need more blood tests. http://go.politicoemail.com/?qs=79e883dffb61ed840aac3a3a958520a01a577b06cd8383f9fcb6f8110d0bff50

** A message from PhRMA: The biopharmaceutical industry continues to be the most research and development-intensive industry in U.S. economy, and PhRMA member companies are at the forefront. New data show PhRMA member companies invested $58.8 billion in research and development in 2015, up 10.3 percent from 2014. The biopharmaceutical industry's long-term research and development investments have led to more medicines in clinical development than ever before, more than 7,000 medicines globally. From 2000 to 2015, more than 550 new medicines were approved by the U.S. Food and Drug Administration - including a record 56 new medicines in 2015. Given just 12 percent of medicines in clinical
 trials ever make it to patients it is critical we have pragmatic, pro-innovation policies to sustain the long-term investments needed to develop tomorrow's cures. Learn more about the industry's commitment to researching tomorrow's treatments and cures here. **

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