This Week in Healthcare Reform: March 12th, 2021

New analyses highlight the potential savings offered by generic drugs; experts consider what telehealth might look like on the other side of the pandemic; the growing role of AI in our healthcare future; and, a recent survey of employers points to the growing importance of integrated benefits.

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Week in Review

Generic Rx Savings: The rising cost of prescription drugs has pushed our healthcare system dangerously close to the edge.  While the focus has understandably been on who’s responsible for driving up those costs, due attention has also been paid to advancing policy and regulatory proposals aimed at curbing pharmaceutical manufacturers’ seemingly unchecked pricing power.  A pair of recent analyses pushes the conversation forward by pointing to how much can potentially be saved by switching from brand-name drugs to generics.  The first economic analysis found that continued delays to the approval of complex generics – such as those used to treat asthma, multiple sclerosis, and diabetes – are costing us as much as $1.7 billion each year.  The second, estimates that substituting generic medications for their brand-name counterparts by prescribing physicians would save the Medicare Part D prescription drug program nearly $1 billion annually.  Analysts go on to estimate that the program could save an additional $700 million if Medicare beneficiaries themselves requested generic drugs.  Generic medicines have saved our healthcare system more than $2.2 trillion over the past decade.  And, with many brand-name drugs scheduled to lose their patent and exclusivity protections in the coming years, the potential for additional savings is significant.

Future of Telehealth: In the immediate wake of the coronavirus public health crisis, telehealth served as something of a lifeline to patients and providers, alike.  For the latter, it enabled health systems to access a steady revenue stream amidst challenging economic conditions.  For the former, it allowed people to access healthcare services in increasingly sophisticated ways.  However, as doctor offices and hospital services have come back online, our expectations and utilization of telehealth has simultaneously undergone a shift.  But, what the pandemic has shown us is that telehealth is much more than just a visit to a digital doctor’s office and has a critical role to play in our evolving healthcare system.  For instance, in the early stages of the coronavirus public health emergency, data pointed to the sharp increase in telehealth use being largely driven by individuals seeking mental health services, rather than for physical ailments.  Also, large employers are now looking to capitalize on the slow healthcare cost growth experienced last year as a result of COVID-19 by expanding virtual care and other benefits for their employees.  For their part, insurers have also looked to expand their telehealth strategies going forward, urging regulators to provide the needed flexibility to ensure the seamless integration of benefits beyond the public health emergency.  And, decisionmakers have responded, exploring pathways to make the temporary changes that had allowed for the expansion of telehealth services permanent.  All of this points to the growing assumption that telehealth will, in some form or another, outlast the pandemic that ushered in its widespread adoption.

Role of AI: As just covered, digital technologies continue to reshape our understanding of what healthcare delivery could look like.  Perhaps nowhere is this more cutting edge than in the artificial intelligence (AI) space.  Already, stakeholders have begun to leverage AI to support larger, industry-wide goals, such as those focused on member engagement, value-based care, and medication adherence.  As it relates to this last area of focus, experts also believe that AI could be used to identify prescription mistakes before they happen.  Given the potential benefits on offer, there’s a growing sense among healthcare executives that AI will have an important role to play in helping to address many of the challenges facing our healthcare system today and in the future.

Integrated Benefits: As with the growing influence of digital technologies, the growing emphasis on integrated benefits is also rapidly restructuring healthcare benefits design.  This focus on whole-person health has led stakeholders across the healthcare spectrum to programmatically embrace the integration of medical, pharmaceutical, and behavioral benefits in pursuit of better health engagement, improved outcomes, and lowered costs.  This includes employers, who are increasingly integrating their own health benefits as a way to achieve those greater cost savings.  In fact, according to a survey performed the latter half of last year, more than half of the employers polled said that they were actively integrating their benefits, including supplemental benefits like vision and dental, citing the value of an integrated approach to benefits, which allows these offerings to work together to cover their employees’ healthcare needs in a more holistic way.


In the latest data insight from NIHCM, researchers focused on how better prediction of rising health spending can result in improved cost containment.

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