Private Sector Solutions to America's Health Care Challenges
•
0 likes•2,996 views
Keynote address by Thomas M. Moriarty, Executive Vice President, Chief Strategy Officer and General Counsel at the Bloomberg Intelligence Healthcare Summit, March 23, 2017.
Recommended
More Related Content
What's hot
What's hot (20)
Viewers also liked
Viewers also liked (20)
Similar to Private Sector Solutions to America's Health Care Challenges
Similar to Private Sector Solutions to America's Health Care Challenges (20)
Recently uploaded
Recently uploaded (20)
Private Sector Solutions to America's Health Care Challenges
- 1. Private Sector Solutions to America’s Health Care Challenges Thomas M. Moriarty Executive Vice President, Chief Strategy Officer and General Counsel
- 2. Addressing Chronic Disease 2 1 in 2 Americans have a chronic disease 1 in 6Americans have three or more chronic conditions. 85% of all health spending on Americans with chronic conditions 46% of all Medicare dollars spent on patients with 6+ chronic conditions Source: 2013 CVS Caremark Enterprise Analytics. Projections based on CVS Caremark data. Individual results will vary based on plan design, formulary status, demographic characteristics, and other factors
- 3. Market Dynamics 3 1. High launch prices for branded products 2. Price increases for older drugs Pricing Dynamics: • Sales and marketing outpace R&D • Slow drug approval timeline • More ‘me-too’ drugs, less innovation • High deductible health plans Causes of High Cost Drugs: $
- 4. Pharma has Shifted its Business Model to Maintain Profits 4 $0 $1 $2 $3 $4 $5 $6 2013 2014 2015 DTC Advertising Spend Spend(inBillions) $3.8 $4.53 $5.40 Source: FDA, Nielsen and Kantar Media
- 5. US Drug Approval Process Lags Behind EU EUROPEAN MEDICINES AGENCY • Average drug approval time 12 months • In 2016, 81 new medicines • 20 approved biosimilars FOOD AND DRUG ADMINISTRATION • Average drug approval time 18 months • In 2016, 22 new medicines • 4 approved biosimilars 5 >
- 6. Touchpoints Across the Healthcare Continuum 6
- 7. Improved Medical Adherence is Essential 7 • Prescription drugs are the ”first, logical choice for medical intervention” for nearly 90% of people with chronic and complex diseases. • Improved medication adherence could save nearly $300 billion in unnecessary medical costs each year. Source: Medco 2011; CVS Health Insights, “adherence,” Fall 2014
- 8. Reducing Preventable Hospital Readmissions 8Source: 2013 CVS Caremark Enterprise Analytics. Projections based on CVS Caremark data. Individual results will vary based on plan design, formulary status, demographic characteristics, and other factors 1 in 7 patients are readmitted within 30 days 2/3 of hospital readmissions are due to medication issues (non- adherence and adverse drug reactions) Up to ¾ readmissions are preventable 65% savings, totaling $3,324 per patient, from reduced readmissions as a result of pharmacist interventions
- 9. Part D Has Been a Success PREMIUMS HAVE BEEN STABLE1 Costs Remain Low, Satisfaction High, More Savings Available • Part D costs have been 45 percent below the original CBO projections by $349 billion2 • Average premiums are stable over time. 2017 monthly premium is approximately $341 • Use of PBM tools will save Part D and its beneficiaries nearly $257 billion from 2016 to 20253 Source: 1- Medicare Trustees Report 2- CBO Projections https://www.cbo.gov/topics/health-care/medicare 3-http://thatswhatpbmsdo.com/wp-content/uploads/2016/02/visante-pbm-savings-study-Feb-2016.pdf 26 9
- 10. An Integrated Approach …enabling us to help deliver superior outcomes at the lowest net cost Cost Mgmt Tools Infusion Care Clinical Programs Digital Long- Term Care Retail Mail Medical Benefit Mgmt Retail Clinics Specialty Patients Payors Providers 10
- 11. Market-oriented Reforms Promote Competition, Curb Rising Costs 11 1. Increase the flow of generics and biosimilars to market. Promote policies that do not delay generic and biosimilar entry. 2. Empower pharmacists to support patient care 3. Acknowledge the role of PBMs in keeping drug costs down.
- 12. FDA’s Drug Approvals Backlog Hampers Competition 1FDA’s Generic Drug Review Dashboard. Updated July 1, 2016. Quicker entry of generic drugs and biosimilars would remove barriers to greater competition. • Quicker entry of generic drugs and biosimilars would remove barriers to greater competition. • Over 4,000 generic drug applications are pending at FDA.1 12
- 13. Greater than 90% of rebates are passed directly back to our PBM clients Despite Market Forces, We Continue to Help Our Clients Cut Trend Source: CVS Health internal data analysis, utilization trend based on commercial cohort (Health Plans and Employers). Trend is reported net of rebates. 13 Trend Drivers Trend Reducer 8.6% 0.4% 2.0% 11.0% -7.8% Brand Inflation Generic Inflation Utilization Unmanaged Trend CVS Health PBM Management CVS Health Trend 3.2%
- 14. 14 Containing EpiPen Costs Impact of PBM-Negotiated Discounts, Rebates and Price Protection
- 15. 15 CVS Health Prioritizes Affordable Medicines for Consumers Adrenaclick $109.99 Cash Price EpiPen $649.00 Brand $339.99 Authorized Generic
- 16. Private Sector Solutions to America’s Health Care Challenges Thomas M. Moriarty Executive Vice President, Chief Strategy Officer and General Counsel