Disaggregating the dementia monolith: An analysis of variation in Medicare costs and use by dementia subtype.

IMPORTANCE: With an aging population, it is necessary to systematically examine variation in costs and use of Medicare services by dementia subtype. We provide the first national estimates for dementia by subtype, and the respective Medicare costs and use. METHODS: We analyzed Medicare fee-for-service (FFS) claims from 2017 through 2019. The sample included 41 million beneficiaries: 727,700 beneficiaries with a new dementia diagnosis in 2017. We calculated descriptive statistics and conducted generalized linear regression models by subtype of dementia. RESULTS: Annual Medicare costs for beneficiaries with dementia ranged from $22,840 for frontotemporal dementia to $44,896 for vascular dementia compared to $9,034 for beneficiaries without dementia. Comparing beneficiaries across dementia subtypes, the greatest differences were in the use of home health and hospice care. CONCLUSIONS: These analyses demonstrate substantial heterogeneity across dementia subtypes, which will be important in developing models of care that improve value for people with dementia.

Modifying the Criteria for Granting Orphan Drug Market Exclusivity.

OBJECTIVES: To examine policy options to deny orphan drug exclusivity after drugs exceed a target population of 200 000 across all orphan indications (combined prevalence threshold) or once drugs receive a nonorphan approval (market approval threshold). METHODS: Retrospective analysis of drugs with 2 or more orphan approvals from 1983 to July 01, 2017 examining prevalence of orphan indications and approval years of orphan and nonorphan indications. Characteristics of drugs crossing either threshold are described. A budget impact analysis of Medicare and Marketscan® claims databases estimated potential savings from generic or biosimilar entry as a result of foregone market exclusivity periods determined by these policies. RESULTS: Out of 86 drugs with 2 or more orphan approvals, 21 drugs would be denied orphan drug exclusivity periods under the prevalence threshold and 18 drugs would be denied orphan drug exclusivity periods under the market approval threshold. Drugs with orphan approvals after 2010 were more likely to be denied orphan drug exclusivity. In 2017, Medicare could have saved about $2 billion on 8 drugs under the prevalence threshold policy and $1.3 billion on 12 drugs under the market approval threshold policy). Private insurers could have saved $814 and $919 million, respectively. Over half of the savings would come from 9 drugs that first entered the market for a nonorphan indication. CONCLUSIONS: Modifying the criteria for granting orphan drug exclusivity would affect a small number of orphan drugs but could generate large savings through increased competition. Other incentives such as grants or tax credits for clinical trials could be explored to incentivize research for new orphan indications for drugs that crossed either threshold.

Premarket Notifications and Patents for Breast Pumps Before and After the ACA.

This study investigates whether ACA policies to increase access to breast pumps and lactation care were associated with innovation in the market for breast pumps.

VALUE AND PERFORMANCE OF ACCOUNTABLE CARE ORGANIZATIONS: A COST-MINIMIZATION ANALYSIS.

OBJECTIVES: Determine the relationship between quality of an accountable care organization (ACO) and its long-term reduction in healthcare costs. METHODS: We conducted a cost minimization analysis. Using Centers for Medicare and Medicaid cost and quality data, we calculated weighted composite quality scores for each ACO and organization-level cost savings. We used Markov modeling to compute the probability that an ACO transitioned between different quality levels in successive years. Considering a health-systems perspective with costs discounted at 3 percent, we conducted 10,000 Monte Carlo simulations to project long-term cost savings by quality level over a 10-year period. We compared the change in per-member expenditures of Pioneer (early-adopters) ACOs versus Medicare Shared Savings Program (MSSP) ACOs to assess the impact of coordination of care, the main mechanism for cost savings. RESULTS: Overall, Pioneer ACOs saved USD 641.24 per beneficiary and MSSP ACOs saved USD 535.59 per beneficiary. By quality level: (a) high quality organizations saved the most money (Pioneer: USD 459; MSSP: USD 816); (b) medium quality saved some money (Pioneer: USD 222; MSSP: USD 105); and (c) low quality suffered financial losses (Pioneer: USD -40; MSSP: USD -386). CONCLUSIONS: Within the existing fee-for-service healthcare model, ACOs are a mechanism for decreasing costs by improving quality of care. Higher quality organizations incorporate greater levels of coordination of care, which is associated with greater cost savings. Pioneer ACOs have the highest level of integration of services; hence, they save the most money.

Hospice Coding and Data Conventions Contribute to Oversimplify the Presence of Dementia in Hospice.

OBJECTIVES: To document how dementia diagnoses appear in hospice claims, and how these different presentations reflect different hospice utilization. The reliance in the hospice literature on primary diagnosis, in addition to the focus on decedents, may underestimate the true presence of dementia in hospice, and little is known about the health care utilization of hospice patients with dementia as a secondary or not present diagnosis. DESIGN: Secondary data analysis of Medicare claims. SETTING AND PARTICIPANTS: Medicare beneficiaries with 2 or more dementia diagnoses from 2016 to 2018 electing hospice in 2018. METHODS: Beneficiaries were classified based on the presence and position of dementia on their subset of hospice claims: primary diagnosis, secondary diagnosis, and not present. We then compared the demographics and utilization of the 3 claim-based categories of dementia beneficiaries in hospice in 2018. RESULTS: Fewer than half of beneficiaries with a dementia diagnosis in all of their Medicare claims have dementia indicated as the primary diagnosis associated with their hospice claims, and 30% of beneficiaries did not have their diagnosed dementia appear at all on their hospice claims. Hospice length of stay and other utilization characteristics varied markedly across the 3 claim-based categories of dementia beneficiaries in hospice in 2018. CONCLUSIONS AND IMPLICATIONS: Collectively, International Classification of Diseases, Tenth Revision (ICD-10) coding and sequencing conventions, coding practices, and research methods related to hospice claim diagnoses may unintentionally underestimate and oversimplify how dementia manifests in hospice utilization.

Comparison of Out-of-Pocket Spending on Ultra-Expensive Drugs in Medicare Part D vs Commercial Insurance.

Importance: Little is known about how out-of-pocket burden differs between Medicare and commercial insurance for ultra-expensive drugs. Objective: To investigate out-of-pocket spending for ultra-expensive drugs in the Medicare Part D program vs commercial insurance. Design, Setting, and Participants: This was a retrospective, population-based cohort study of individuals using ultra-expensive drugs included in a 20% nationally random sample of prescription drug claims from Medicare Part D and individuals aged 45 to 64 years using ultra-expensive drugs included in a large national convenience sample of outpatient pharmaceutical claims from commercial insurance plans. Claims data from 2013 through 2019 were used, and data were analyzed in February 2023. Main Outcomes and Measures: Claims-weighted mean out-of-pocket spending per beneficiary per drug by insurance type, plan, and age. Results: In 2019, 37 324 and 24 159 individuals using ultra-expensive drugs were identified in the 20% Part D and commercial samples, respectively (mean [SD] age, 66.2 [11.7] years; 54.9% female). A statistically significant higher share of commercial enrollees vs Part D beneficiaries were female (61.0% vs 51.0%; P < .001), and a statistically significantly lower share were using 3 or more branded medications (28.7% vs 42.6%; P < .001). Mean out-of-pocket spending per beneficiary per drug in 2019 was $4478 in Part D (median [IQR], $4169 [$3369-$5947]) compared with $1821 for commercial (median [IQR], $1272 [$703-$1924]); these differences were statistically significant every year. Differences in out-of-pocket spending comparing commercial enrollees aged 60 to 64 years and Part D beneficiaries aged 65 to 69 years exhibited similar magnitudes and trends. By plan, mean out-of-pocket spending per beneficiary per drug in 2019 was $4301 (median [IQR], $4131 [$3000-$6048]) in Medicare Advantage prescription drug (MAPD) plans, $4575 (median [IQR], $4190 [$3305-$5799]) in stand-alone prescription drug plans (PDPs), $1208 (median [IQR], $752 [$317-$1240]) in health maintenance organization plans, $1569 (median [IQR], $838 [$481-$1472]) in preferred provider organization plans, and $4077 (median [IQR], $2882 [$1075-$4226]) in high-deductible health plans. There were no statistically significant differences between MAPD plans and stand-alone PDPs in any study year. Mean out-of-pocket spending was statistically significantly higher in MAPD plans compared with health maintenance organization plans and in stand-alone PDPs compared with preferred provider organization plans in each study year. Conclusions and Relevance: This cohort study demonstrated that the $2000 out-of-pocket cap included in the Inflation Reduction Act may substantially moderate the potential increase in spending faced by individuals who use ultra-expensive drugs when moving from commercial insurance to Part D coverage.

Effects of an out-of-pocket maximum in Medicare Part D.

OBJECTIVES: Three different out-of-pocket (OOP) maximums in Medicare Part D have been proposed: $2000 by the House of Representatives, $3100 by the Senate Finance Committee, and the beginning of catastrophic coverage by the Medicare Payment Advisory Commission. However, little is known about how beneficiaries would be affected. STUDY DESIGN: We estimated multivariate linear regression models to determine which beneficiary characteristics were associated with the greatest savings under each proposed OOP maximum and simulated a potential behavioral response by beneficiaries. METHODS: Using Part D 2017 claims data for beneficiaries in stand-alone prescription drug plans (PDPs) and Medicare Advantage prescription drug (MA-PD) plans, we estimated the number of beneficiaries affected, their demographic characteristics, and their drug utilization patterns. We then simulated a potential behavioral response by beneficiaries. RESULTS: Under the $2000 OOP proposed threshold, only 7% of PDP and 4% of MA-PD plan beneficiaries would have spending high enough to reach the OOP maximum. Annual mean (SD) savings would be $1301 ($1849) for PDP beneficiaries and $1363 ($1888) for MA-PD plan beneficiaries, concentrated among beneficiaries taking specialty drugs. As the threshold increases, fewer beneficiaries would accrue savings, but savings would increase. For the highest proposed OOP maximum, mean (SD) savings would be $2720 ($3465) and $2473 ($2805) for PDP and MA-PD plan beneficiaries, respectively. In our simulations, we estimated that the number of beneficiaries affected by an OOP maximum could increase by 2% to 11%, depending on the magnitude of response, but changes in savings would be minimal. CONCLUSIONS: As currently drafted, proposed OOP maximums would reduce OOP spending for a small population of Part D beneficiaries, with savings concentrated among beneficiaries with the very highest costs who are taking specialty medications.

Impact of Electronic Prescribing of Controlled Substances on Opioid Prescribing: Evidence From I-STOP Program in New York.

New York's Internet System for Tracking Over-Prescribing (I-STOP) Act, requires prescribers in the state to electronically prescribe controlled substances (EPCS). We examine the effects of this mandate on prescribing patterns of opioids for Medicare Part D beneficiaries. Using 2014-2017 CMS Medicare Part D Prescriber Data, we apply a lagged dependent variable regression approach to identify the impact of I-STOP on the prescription of opioids. In the first year of implementation, the number of opioid prescriptions per prescriber decreased by 5.7 per year. The policy had a larger effect on the prescription of short-acting opioids and on prescribers prescribing medication for predominantly younger beneficiaries. Overall, I-STOP resulted in a reduction in the number of beneficiaries being prescribed opioids and in the number of opioid claims in the state of New York, suggesting positive implications for other states intending to curtail opioid overprescribing and misuse through the use of EPCS.

Comparing patient OOP spending for specialty drugs in Medicare Part D and employer-sponsored insurance.

OBJECTIVES: Per capita spending on specialty drugs increased 55% between 2014 and 2018. Individuals aged 55 to 75 years using specialty drugs make the transition from employer-sponsored insurance (ESI) to Medicare Part D coverage. We compared out-of-pocket (OOP) spending across ESI, Medicare fee-for-service (FFS), and Medicare Advantage (MA) prescription drug plans to examine the impact of benefit design on OOP spending. STUDY DESIGN: Analyses consisted of Truven MarketScan and Medicare Part D prescription drug claims from 2013 to 2017 for individuals enrolled in ESI, FFS, and MA drug plans taking at least 1 drug among the top 4 specialty drug classes: rheumatoid arthritis (RA), multiple sclerosis (MS), cancer, and hepatitis C. METHODS: Multivariate regression analyses with fixed effects were used to assess whether there are differences in OOP spending by insurance type and the impact of benefit design differences. A secondary outcome was drug choice within a therapeutic class. RESULTS: There were small differences in drug choice between Medicare and ESI but significant differences in OOP spending. Monthly OOP spending for ESI relative to FFS was $108 less for RA drugs, $288 less for MS drugs, $504 less for cancer drugs, and $1437 less for hepatitis C drugs. Spending was slightly greater for beneficiaries in MA plans compared with FFS. Higher Medicare spending was driven by gaps in coverage in the Part D benefit phases because beneficiaries pay a percentage of list price. CONCLUSIONS: OOP spending was substantially higher for Medicare enrollees compared with ESI enrollees as a result of the Part D benefit structure.

Market Exclusivity for Drugs with Multiple Orphan Approvals (1983-2017) and Associated Budget Impact in the US.

OBJECTIVES: The Orphan Drug Act extends exclusivity of branded drugs by 7 years for each rare disease approval. By extending market exclusivity, manufacturers can forestall generic competition. We determined the prevalence of drugs with multiple orphan approvals, the duration for which manufacturers are able to maintain exclusivity using this mechanism, and the budget impact of these additional exclusivity periods on US spending on orphan drugs. METHODS: We analyzed a retrospective cohort of US orphan drug approvals filed between 1983 and 2017. Drug costs throughout this time period were measured using IQVIA claims data. We estimated additional years of exclusivity per drug per orphan approval using mixed-effects negative binomial regression. The budget impact analyzed potential cost-savings for exclusivity periods greater than 7 years after the initial orphan approval based on potential price reductions from the introduction of biosimilar/generic competition. RESULTS: A total of 432 branded drugs were approved for 615 orphan indications, of which 108 had multiple indications. Market exclusivity, beyond the initial 7 years, increased by 4.7 years with two orphan approvals, and there were 3.1-, 2.7-, and 2.9-year extensions for three, four, and five approvals, respectively (p < 0.05). Drugs with five approvals averaged 13.4 additional years of exclusivity. Sixteen drugs had exclusivity periods extending at least 1 decade beyond the original exclusivity period. The potential budget impact of additional exclusivity was estimated at US$591 billion for 7 years following the end of the first approval. CONCLUSIONS: Multiple blockbuster drugs have received exclusivity of > 10 years through the Orphan Drug Act, thereby delaying rare disease cohorts' access to generic/biosimilar equivalents.