Price Transparency Is Critical to Drug Pricing Solutions

Prescription drug costs are a hot political issue, not as much because of the share of the U.S. health care dollar they consume but because consumers pay a larger share of their drug costs out of pocket than they do for other health care.

The lack of price transparency for prescription drugs is a large part of the problem, and making pricing more transparent throughout the process could help in finding viable solutions.

About 10% of overall health spending in the U.S. goes to prescription drugs, dwarfed by the 32% spent on hospitals and 26% on physician, dental, and other clinical services, according to National Health Expenditure data.

But more of the costs for prescription drugs are shifted to consumers than for other health costs.

Under a typical plan, consumers pay a $20-$30 copayment for physician visits and $250 for a hospital stay.  But the complex charges for prescription drugs often range from co-payments of $15 – $100 for “preferred” drugs to 45% or more of the cost of specialty or non-preferred drugs.

Consumers therefore experience more out-of-pocket costs for medicines while a greater share of other, likely more-expensive, medical expenditures is run through insurance.

A huge system of drug rebates and discountshappens behind the scenes in the pharmaceutical supply chain, further distorting the market and confusing consumers about the actual price of a drug. Only a trickle of these discounts and rebates actually reaches the consumer.

Even though rebates paid by biopharmaceutical companies can substantially reduce the prices insurers and pharmacy benefit managers (PBMs) pay for brand medicines, insurers use list prices—rather than discounted prices—to determine how much to charge patients when they pay their share, further increasing what consumers pay.

A survey by the National Community Pharmacists Association taken in early June looked at these behind-the-scenes pricing deals.  “One pharmacist told surveyors that a major PBM required the pharmacy to collect a $35 copay for a generic allergy spray [from the consumer], then took $30 back from the pharmacy. Another said a PBM charged a $15 copay for insomnia drug Zolpidem, then took back $13.05.”

In another example, the pharmacy received only a few dollars in net payments “while patients were charged $30 above the cash price for a generic cholesterol medication,” according to a report on CNN.

In many cases, a consumer pays more to fill a prescription than the PBM paid to purchase the drug, even though consumers “assume what they are paying is the cost of the drug,” said Susan Pilch, vice president for policy and regulatory affairs with the pharmacists’ group.

The percentage of people paying more than $1,000 out-of-pocket a year for medicines also is on the rise: From 2004 to 2014, the portion of people spending more than $1,000 outside of their insurance coverage nearly tripled, from 1% to 2.8%, according to the Kaiser Family Foundation.  Kaiser also reported that 8% of adults report foregoing prescriptions because they can’t afford them.

There also is a built-in incentive in the health care industry, including the pharmaceutical sector, to set their prices artificially high.   Private insurers, PBMs, and others demand the discounts in exchange for their business.  Government entities also demand kickbacks from drug companies: States require them to pay “rebates”—basically a tax for the privilege of participating in Medicaid.

Because of these discounts and rebates to volume purchasers of their products, manufacturers of innovator drugs realized 39% of gross drug expenditures in 2015, according to a study by the Berkeley Research Group. Other players received 42% of total drug spending, with the largest share going to the various rebates, discounts, and fees that manufacturers pay to PBMs, health plans, government entities, and patients.  The total value of pharmaceutical manufacturers’ price concessions was $127 billion in 2016, according to a separate report by the Quintiles IMS Institute.

Consumers, therefore, are impacted in at least two ways.  Few of these discounts actually reach them directly, and many are required to pay their share of their prescription drug bills based upon the retail price of the drug.

Insurance companies generally create complex “drug formularies” in which their insured patients pay less for “preferred” drugs, especially generics, but can pay much more for expensive brand and specialty drugs.  Consumers may be required to pay a percentage of the cost—called co-insurance. Others may pay a flat co-payment.

The sickest patients needing newer and more expensive drugs to treat their illness may face hundreds or even thousands of dollars in out-of-pocket costs to get their medicines, especially

if the drug they need is not on their insurers “preferred” formulary list.

Patients who need generics—older drugs which are generally much less expensive—may face lower drug costs.  But if patients need a newer, brand-name drug, they could face much steeper prices.  Many patients are being asked to pay a greater share of prescription costs for more-expensive specialty drugs because of high coinsurance amounts.

More than half of out-of-pocket spending for brand-name innovator medicines by commercially insured patients is based on the full list price of the drug, according to an analysis by Amundsen Consulting.

Adding another layer of cost-exposure, a growing number of consumers face hefty annual deductibles with their health insurance policies.  In 2016, 83% of people who get health insurance at work faced a deductible for single coverage averaging $1,478.   That means a worker must spend the first $1,478 out of pocket before health insurance kicks in.  And if he or she needs medicine, the full retail price must be paid up front at the pharmacy.  Consumers who have coverage through the ObamaCare exchanges face annual deductibles ranging from $6,000 for an individual to more than $12,000 for a family.

Consumers benefit little if at all from the huge system of discounts and rebates in the pharmaceutical pricing chain.

PBMs and health plans argue that the savings they receive from the discounts and rebates the drug companies provide help reduce the overall cost of premiums.  Some portion may be shared directly with consumers through lower premiums and by helping to lower the cost of physician or hospital care. But the higher visible costs of prescription drugs are a key reason consumers are angry about drug costs.  That strategy isn’t helping them.

Some companies are trying to address the problem in other ways.

  • Express Scripts has created Inside Rx, a new subsidiary to pass discounts to patients who are uninsured or who face unaffordable out-of-pocket costs for diabetes, asthma, and other prescription drugs. Inside Rx says it delivers average savings of 34% off a drug’s typical cash price.  Patients can apply for a discount card that can be used at any of 40,000 pharmacies across the country.
  • UPMC Health Plan is working to change the way it pays for drugs, creating a new Center for Value-Based Purchasing of Pharmaceuticals, saying it wants to “fundamentally change the way medications are paid for in the U.S.” It plans to test various payment models, including payment for outcomes. This is a system that the pharmaceutical industry is also advocating.
  • CVS Health, a PBM run by the drug chain, also has developed a program to help reduce the costs of drugs at the point of sale. While nearly 9 out of 10 drugs dispensed in the U.S. today are generics, patients needing newer, often more-expensive innovator drugs may face significant out-of-pocket costs for the reasons explained above. CVS Health reports it has “developed the capability to reduce members’ [out-of-pocket] spending by applying rebates at the point of sale.”  The plan is being implemented for CVS employees and by some CVS Health clients.
  • Prescription drug companies also provide billions of dollars in donations to help those in need with the cost of their medicines.  Pharmaceutical manufacturers contributed $6.5 billion in 2014 to charities that offset the costs of medicines for patients who need assistance.  These patient assistance programs actually account for 10 of the largest 15 charities in the U.S., according to an analysis by Sanford C. Bernstein & Company.Critics say that the drug companies do this to pay a patient’s cost so they can take advantage of the added costs the insurers will pay. But doctors say the assistance is vital to their patients needing the drugs.

The Amundsen Consulting study found that prescriptions subject to a deductible or facing undiscounted prices were more than twice as likely to be abandoned at the pharmacy than those whose costs were manageable, leading to avoidable hospitalizations and poorer health outcomes.

“While biopharmaceutical companies set the list prices for their medicines, it is the health plan that ultimately determines how much a patient pays out-of-pocket,” said Stephen J. Ubl, president and chief executive officer of the Pharmaceutical Research and Manufacturers of America, or PhRMA, which commissioned the analysis.

There are a number of other price distortions in the health sector, including 340B discounts that many hospitals and clinics receive. The program began in 1992 to provide safety-net hospitals, clinics, and other providers the same kind of relief from high drug costs that Congress provided to the Medicaid program with the Medicaid rebate law.

While originally designed to help entities that serve the nation’s most vulnerable patient populations to stretch dollars further, the number of 340B entities has soared and now includes most major hospitals and many specialty medical practices, such as oncology clinics.  While 340B discounts affected 3% of purchased drugs in 2004, the discounts impacted more than a quarter of prescription drugs in 2013.

Too often, the steep discounts that these 340B entities receive are not passed along to consumers, keeping their prices high while the hospital or other facility reaps the benefits of the lowest-price the drug companies are required to accept. Some 340B providers may sell 340B drugs to non-qualified patients (usually those covered by an insurance plan) and pocket the difference, according to a study by the American Action Forum.

The Medicare prescription drug benefit program can be a model for a more transparent insurance system.  Under Medicare Part D, insurers compete fiercely for senior’s business, with plans offering transparency on the price of drugs and the drugs listed on their formularies.  And the plans have an incentive to pass the savings on to consumers to encourage them to enroll in their plans.

Pacific Research Institute economist Wayne Winegarden explains that “the current pricing model for pharmaceuticals is overly-complicated and diminishes the beneficial role that prices typically play in a market economy.”  He explains that “most rebates are not passed on to patients, and since co-pays are based on the list price, individuals’ co-pays are higher than they should be.”

Pricing reforms that establish a simpler, more transparent pricing structure are needed. The Institute for Policy Innovation published a paper on “Selective Transparency: Transparency Efforts Obscure Real Health Care Pricing Issues” by Merrill Matthews and Peter Pitts.  They detail five ways to lower prices and increase transparency.

  • Fire the MiddlemenBloomberg News, for example, reports that Caterpillar moved away from its PBM, suspecting that a quarter of the manufacturer’s $150 million annual drug bill was being wasted. The company began negotiating its own drug discounts and deals with pharmacies.
  • Promote Transparent PBMs. Bloomberg also reports that some companies are switching to “transparent PBMs” that charge flat fees for negotiating drug discounts. And some states are embracing a “fiduciary standard,” requiring PBMs to put their clients’ interests ahead of the company’s interests.
  • Reduce Regulatory Burdens. President Trump has made it a key part of his presidency to reduce onerous regulations. Food and Drug Administration Commissioner Scott Gottlieb is well aware of the agency’s regulatory roadblocks and is working aggressively to modernize the drug and device approval system.
  • Allow New Payment Models. Several experts have proposed new payment models that should be considered. For example, the pharmaceutical manufacturers are developing value-based payment approaches for some of their most expensive branded drugs, where the price of the drug depends on how successful it is.
  • Critical Care Life Insurance. This is traditional term life insurance, but it allows policyholders facing high medical costs the ability to draw on part or all of the value of the policy to pay for medical expenses. It’s not a loan; the face value of the policy is reduced accordingly. But it is a way to have both life insurance and a safety net in case the policyholder has a major medical incident. Both approaches mean fewer laws and regulations that bottleneck the health care system and make transparency so difficult. And they try to increase competition and put the consumer in charge once again.

Prescription drug pricing is teed up to be the next major health reform debate once Congress completes work on legislation to stabilize health insurance markets.

Sorting through this maze of pricing distortions in the pharmaceutical sector is important to achieve viable policy solutions rather than easy talking-point “wins” that are unlikely to succeed.

The basic truth is that billions of dollars are sloshing around in the prescription drug purchasing chain, but too few of the discounts trickle down to consumers paying out of pocket for their prescription medicines.  List prices also are artificially inflated by the bizarre pricing system for pharmaceuticals. A patient needing a drug costing $800 may have to pay half or more of the cost, but a patient needing a prescription for a generic drug may pay only a small copayment. And a patient without insurance pays the full, sometimes inflated retail price at the pharmacy.

Fueling the problem, prices for brand-name pharmaceuticals have increased as new specialty drugs have been introduced at high costs, often due to years of investment in research, the costs of manufacturing more complex medicines, and regulatory delays in getting new drugs to market.

Greater price transparency is will be a crucial element in a long-term solution to engage millions of consumers in getting the best value for their health care dollar.

– Grace-Marie Turner is the president of the Galen Institute, a non-profit research organization focusing on patient-centered health reform.

[“Source-forbes”]

The BlackBerry DTEK60 is officially out with a $499 price tag

BlackBerry might pride itself on a unique security-oriented approach to Android, but that was hardly reflected in the DTEK60 development process. If you have been keeping an eye on the Canadian company over the past few months, then you definitely know about the leaked renders, followed by a full specs reveal on the official website, all topped off by a weird pre-release pre-order campaign in Canada.

That being said, it comes as no surprise that we are already pretty well acquainted with the device BlackBerry made official today. Much like its DTEK50 sibling, the DTEK60 is based on an existing Alcatel, or rather TCL design. This time, however, it is the higher-end Idol 4S and to top things off, BlackBerry has made a few improvements to the specs sheet as well.

BlackBerry DTEK60 BlackBerry DTEK60
BlackBerry DTEK60

The DTEK60 features a metal-framed body with a dual-glass finish – one on the back and one on the front. This already makes it considerably more appealing than the DTEK50. The rest of the specs only further that notion. The DTEK60 is equipped with a 5.5-inch QHD panel and is powered by a Snapdragon 820 SoC with 4GB of RAM and 32GB of internal storage. In terms of camera, it features a 21MP rear unit and an 8MP front shooter. A 3,000mAh battery is there to keep the lights on. The device also comes with a fingerprint sensor, USB Type-C port and a programmable button on the side.

However, for many, the main course comes in the software department. In line with BlackBerry’s new development strategy, the DTEK60 boots an extra secure Android 6.0 Marshmallow distribution, with a Nougat update planned in the future. You get some added piece of mind thanks to the secure bootloader, Hardware Root of Trust and some added productivity in the right enterprise environment thanks to BlackBerrry’s own apps, such as the Hub and Calendar.

As already mentioned, the BlackBerry DTEK60 is now available to end users SIM-free for $499. But the primary target market remains business. Although no longer involved in direct hardware manufacturing, BlackBerry is still just as strong as an end-to-end enterprise communications supplier. That being said, the DTEK 60 is most-likely to end up in your possession if you work in a company signed up for BlackBerry’s device services.

The Canadian OEM has also reaffirmed its intentions to keep to a similar business model in the foreseeable future. Hence, we can only expect to see more TCL manufactured devices get the BlackBerry treatment.

source”cnbc”

Why AMD FreeSync is beating Nvidia G-Sync on monitor selection and price

gsync monitor key visual

Let’s say you’ve just bought one of Nvidia’s slick new Pascal-based GeForce graphics cards such as the GTX 1070, and now you’re seeking a G-Sync monitor to go with it.

Looking at what’s available, you’ll probably become envious of PC gamers on the Radeon side of the fence. Compared to G-Sync monitors, displays supporting AMD’s FreeSync adaptive sync tech are generally much cheaper, with a wider range of vendors and tech specs to choose from. The website 144HzMonitors lists 20 available G-Sync monitors, versus 85 FreeSync monitors, the latter showing more combinations of screen size, refresh rate, and resolution.

Why the disparity? The conventional wisdom is that Nvidia’s proprietary G-Sync hardware module raises the monitor price due to licensing fees, but that’s not a satisfying explanation. Nvidia is still far and away the market share leader in graphics cards, so you’d think that most monitor makers would create G-Sync variants of their FreeSync displays and at least give GeForce users the option of absorbing the module cost.

As I started talking to monitor makers, a more complicated picture emerged. The real reason for G-Sync’s limited availability is as much about design and development concerns as it is about the price of the module itself.

G-Sync vs. FreeSync refresher

PCWorld has already published a detailed primer on G-Sync and FreeSync, but the gist is that both technologies allow the graphics card to adjust the monitor’s refresh rate on the fly, matching it to the PC’s current framerate. This prevents the screen tearing effect that occurs when refresh rate and framerate fall out of sync, and (mostly) eliminates stutter, creating a buttery-smooth gameplay experience.

catalyst omega amd freesync

G-Sync accomplishes these variable refresh rates with a proprietary hardware module, which is built into every supported monitor. With FreeSync, no such module is required, because it uses the variable refresh rate tech that’s part of the DisplayPort standard (and, more recently, HDMI as well). But again, the lack of extra hardware is not the only reason FreeSync monitors are cheaper and more readily available.

Design costs

Some display makers say Nvidia’s module requires more room inside the monitor enclosure. While that may not seem like a big deal, creating a custom product design for one type of monitor raises development costs considerably, says Minhee Kim, a leader of LG’s PC and monitor marketing and communications. By comparison, Kim says, AMD’s approach is more open, in that monitor makers can include the technology in their existing designs.

“Set makers could adopt their technology at much cheaper cost with no need to change design,” Kim says. “This makes it easier to spread models not only for serious gaming monitors but also for mid-range models.”

LG’s FreeSync monitor selection bears this out: The company offers several 1080p monitors under 30 inches diagonal with an ultrawide 21:9 aspect ratio, priced as little as $279. With G-Sync, the only 1080p ultrawide monitor is a 35-inch curved panel from Acer with a much higher refresh rate. The cost? $900.

gsyncpredator

The cheapest ultrawide 1080p G-Sync monitor will set you back nearly $1000.

Even if monitor makers proceed with the necessary research and development, the resulting product will be more expensive, which inevitably means it will sell in lower volumes. That, in turn, means it’s harder for monitor makers to recoup those up-front development costs, says Jeffry Pettinga, the sales director for monitor maker Iiyama.

“You might think, oh 10,000 sales, that’s a nice number. But maybe as a manufacturer you need 100,000 units to pay back the development costs,” Pettinga says.

Meanwhile, he says, monitors are constantly improving in other areas such as bezel size. As monitors shrink from wide bezels to slim bezels to edge-to-edge displays, the risk is that a slow-selling G-Sync will become outdated long before the investment pays off.

“Let’s say you introduced, last year, your product with G-Sync. Six months of development, and you have to change the panel. You haven’t paid off your development cost,” Pettinga says. “There’s a lot of things going on on the panel side.”

Limited flexibility

Costs aside, some monitor makers feel restricted in how they can differentiate their G-Sync monitors.

Display maker Eizo, for instance, has a feature in its gaming monitors called Smart Insight that adjusts gamma and brightness on the fly, helping to improve visibility in light and dark areas. This feature wouldn’t be possible with G-Sync, says Keisuke Akiba, Eizo’s product & marketing manager, because Nvidia’s module handles all the color adjustments itself.

“The G-Sync module accepts color adjustment in the module, not an outside chip,” Akiba says. “Our color adjustment needs power and flexibility so we’ve gone for FreeSync.”

eizo

G-Sync doesn’t allow monitor makers to offer their own color adjustments, like Eizo does.

Monitor makers also have limits on what video inputs they can include. All G-Sync monitors have one DisplayPort input, and in some cases they also include an HDMI input that doesn’t support variable refresh rate. You won’t find any G-Sync monitors with more than two inputs (or with support for DVI). Also, G-Sync doesn’t support variable refresh rate over HDMI. That means every G-Sync monitor must include DisplayPort—again raising the cost to manufacture.

“DisplayPort is relatively expensive on a monitor because of the cable—it’s a quite expensive cable if you include a cable—and the board design itself. So DisplayPort adds a lot more to the cost than HDMI,” Pettinga says.

Nvidia’s answer: It’s about value, not cost

In an interview, Tom Petersen, Nvidia’s director of technical marketing, doesn’t dispute any of these concerns, and acknowledges that the high cost to develop G-Sync monitors puts them into a pricier segment of the market.

But to Nvidia, that’s okay, because G-Sync is supposed to be a premium product. The company points to several ways in which G-Sync is superior to FreeSync, including its ability to handle any drop in refresh rate—FreeSync only works within a specified range—and Nvidia’s complete control over things like monitor color and motion blur, which Petersen argues are superior to what monitor makers are offering outside the module.

For those reasons, Petersen says any price disparity between comparable G-Sync and FreeSync monitors is not due to the module, whose cost he says is “relatively minor,” but due to monitor makers’ decision to charge more.

“To me, when I look out and see G-Sync monitors priced higher, that’s more of an indication of value rather than cost,” he says. “Because at the end of the day, especially these monitors at the higher segments, the cost of the components don’t directly drive the price.”

gsyncmodule

Nvidia says the proprietary module is not a major contributor to the cost of G-Sync monitors, especially since it replaces some other standard components.

Perhaps that’s a fair point for higher-priced monitors, but as we’ve heard from monitor makers, the bigger issue is that the module is inherently harder to include in lower-priced options. With G-Sync, for instance, you can’t buy a 60Hz monitor in less than 4K resolution, whereas FreeSync offers plenty of options in 1440p and 1080p.

Nvidia’s Petersen suggested that addressing these mid-tier markets isn’t a priority. “I think over time, you’ll see lower-priced monitors that are lower-featured, that include G-Sync, but it’s not our goal,” Petersen says. “Our goal is to provide a premium gaming experience, and the premium gaming experience requires a lot of hands-on work from Nvidia, and that’s where we’re going to continue to focus over time.”

Of course, some monitor makers would prefer that Nvidia supported DisplayPort’s adaptive sync standard, so users could ,at least enjoy some anti-tearing benefits even if they didn’t splurge for a G-Sync monitor. To that, Petersen says “never say never,” but right now he argues there’s no benefit to doing so.

“I’m worried that by just throwing it out there, we could be delivering the same less-than-awesome experience that FreeSync does today,” he says, “and that’s just not our strategy.”

For loyal Nvidia customers, the takeaway is clear: If you want G-Sync, be prepared to jump into the deep end of luxury gaming monitors, because the technology isn’t going downmarket anytime soon.

source”cnbc”

Samsung Gear S3 to carry €399 price tag in Europe

Samsung has announced pricing information for its latest Gear S3 smartwatch, which wasunveiled by the company at the ongoing IFA conference in Berlin. The wearable, as you might already know, comes in two variants: Classic and Frontier.

The South Korean company has confirmed that both variants will carry a price tag of €399 (around $445) in Europe.

There’s, however, currently no word on when the latest Samsung smartwatch will be available for purchase in the region, although we expect the tech giant to reveal the information soon. Meanwhile, you can read our hands-on impressions to know more about the device.

source”gsmarena”

Oppo F1s is official with a 16MP selfie camera and $270 price tag

The Oppo F1s is now official and takes over the company’s “Selfie Expert” banner from the F1. The phone carries a 16MP front-facing camera (no LED flash here, though) with a 1/3.1-inch sensor and f/2.0 aperture.

Selfies come out even better thanks to Oppo’s Beautify 4.0 feature. Additional software features of the selfie camera include a selfie panorama and filters. The back camera is 13MP and supports up to 1080p video recording. The focus is definitely on the front camera.

Below the selfie camera, there’s a 5.5″ 720p IPS display. Below that is a fingerprint sensor. Inside the metal body, we’ve got a Mediatek MT6750 chipset with an octa-core Cortex-A53 CPU running at 1.5GHz. RAM is 3GB, while the internal storage is 32GB, backed up by a microSD card slot. The battery is a non-removable 3075mAh Li-Po unit.

Pricing is around INR 18,000 ($270), which is a great price if your main concern is taking great selfies.

We’ve actually got a visit from the Oppo F1s at the office and were quick to give it a whirl. Check out our extensive Oppo F1s hands-on to learn more about what it’s all about
[“source -pcworld”]

7,shares,with,a,high,earnings,beat,price

a collection of shares reporting profits within the following couple of days may be ready to pop, if historyis any manual.

Of the 41 S&P 500 businesses which have mentioned first-region effects so far, 29 beat EPS estimates, 3matched and some other 9 ignored. of these names, about 1/2 disclosed sales figures above analysts’expectancies.

while betting on stocks ahead of profits is mostly a hard trade, investors tend to have a look at historicfacts to make checks approximately the future.
right here are some of the names that could advantage from a postincome surge.

Analysts foresee 24% dip in Chipotle stock price

Chipotle Mexican Grill

Scott Elsen | Getty Images

Deutsche Bank downgraded shares of Chipotle Mexican Grill to a “sell” from a “hold” on Tuesday, citing a lack of faith in the company’s ability to recover after a series of foodborne illness outbreaks.

“We still question what a recovery will look like (and when it will materialize),” Deutsche Bank analysts said in a research note. They said that while management has been proactive in “trying to regain consistency and customer trust, there is tremendous uncertainty on how well they will be received.”

The bank’s analysts foresee a 24 percent drop in Chipotle’s stock price, a plunge to $400 from its Feb. 22 price of $525.90. Shares in the restaurant are down more than 22 percent in the past 12 months, even though the stock is up more than 8 percent since January.

What’s the next big restaurant? 10 brands to watch

Source: Juice Served Here

Chipotle did not immediately respond to CNBC’s request for comment.

The move comes just weeks after the Centers for Disease Control and Prevention announced that the fast-casual chain’s E. coli outbreak was over. Chipotle also faced outbreaks of norovirus and salmonella, resulting in at least nine lawsuits, according to the Chicago Tribune.

Chipotle’s same-store-sales trends had shown signs of weakness before its series of foodborne illness outbreaks, Deutsche Bank noted. The analysts blamed a lack of new menu introductions and price increases for the dip.

Deutsche Bank is the first firm to go to a “sell” rating, but this is not the first time Chipotle has been downgraded this year. A majority of analysts now rate the fast-casual chain’s stock as a “hold” when they previously had it at “buy.”
[“source -pcworld”]