Findings From Recent CMS Research On Medicare Brennan
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Findings from Recent CMS Research on Medicare Chair: Niall Brennan Patent Expirations and Part D Spending on Atypical Antipsychotic Medications Eric Rollins Director, Policy & Data Analytics Group Office of Information Products and Data Analytics Use of Generic Drugs in Part D, 2007-2012 ● The share of total prescriptions filled with generics rose from 63% in January 2007 to 84% in December 2012 3 Brand-Name Drugs Losing Patent Protection ● These figures are based on total U.S. sales 4 Part D Spending for Atypical Antipsychotics ANTIPSYCHOTICS/ANTIMANIC AGENTS 2013 Spend (%) 2013 Fills (%) Total Spending Trend 300 250 $5.8 B (6%) 29 8 M (2%) 29.8 200 150 100 50 2006 2007 2008 2009 2010 2011 2012 2013 5 Major Atypical Antipsychotics: Patent Expiration Dates and Part D Market Shares Drug Generic Name Patent Expiration * Forms Affected Percentage of 2011 Fills Clozaril Risperdal Zyprexa Geodon Clozapine Risperdone Olanzapine Ziprasidone 30-Aug-96 30-Jun-08 24-Oct-11 02-Mar-12 Tablet Tablet Tablet Capsule 5.2 25.6 14.3 5.5 1.7 6.5 26.2 7.1 Seroquel Quetiapine Fumarate 26-Mar-12 26 Mar 12 Tablet 34 32 3 32.3 Abilify Aripiprazole Apr-15 Tablet 12.1 19.7 N/A N/A N/A 96.7 93.5 Total Percentage of 2011 Spend * This is the expiration date for the patent on the leading dosage form, as reported by the FDA Orange Book; the date for Abilify comes from Express Scripts/Medco's file of anticipated patent expiration dates, accessed on April 1, 2013. 6 Generics as a Share of Total Prescriptions, by Drug Drug, by Months after Patent Expiration (Here month 1 is the month when the patent expired.) 7 Part D Market Shares, by Prescriptions, 2006-2013 (Risperdal patent expires) (Zyprexa (Seroquel patent patent expires) expires) 8 Part D Market Shares, by Spending, 2006-2013 (Risperdal patent expires) (Zyprexa (Seroquel patent patent expires) expires) 9 Year-over-Year Monthly Growth Rates in Average Spending per Prescription (Here month 0 is the month when the patent expired) 10 11 12 13 14 Key Findings ● Rapid generic substitution (80-90% within 2 months of patent expiration and ~95% within 9 months) months), but limited therapeutic substitution within the drug class ● Savings in first 180 days after patent expiration were relatively limited for two drugs The average cost of the brand-name brand name drug increased rapidly leading up to patent expiration When a single generic manufacturer held the market exclusivity rights for the first 180 days after patent expiration, the average cost of the generic was similar to the brand-name cost 12-24 months prior ● The average cost of generic prescriptions declined sharply after the 180-day period, but full extent of savings may take years to appear 15 Use of Post-Acute Care Following a Hip or Knee Replacement (DRG 470) Allison Oelschlaeger Office of Information Products and Data Analytics Episode Construction ● Episodes started with an index hospitalization that occurred in CY 2010 Initial episodes had to be preceded by a 30-day clean period, during which the beneficiary received no acute or post-acute post acute care services ● Episodes ended “naturally” with either a clean period (20 days) or admission for certain surgical MS-DRGs MS DRGs ● PAC defined as use of home health, SNF, IRF, LTCH, or Part B outpatient therapy (hospital outpatient therapy services and therapy claims delivered by independent therapists) 17 MS-DRG 470: Profile ● Total Episodes = 285,520 $25,000 (Total discharges for DRG 470 = 437,981) ● Total Spending = $6.1 B ● Average episode cost = $21,317 $20,000 $15,000 $990 $731 $7,663 ● Average episode length = 56 days ● Beneficiaries: Survived the index admit in 99.9% of episodes (285,242) Survived the index and used PAC as the fi t service first i after ft the th index i d in i 92.3% 92 3% off episodes (263,507) ● Readmissions per episode = 0.09 $10,000 $5,000 $11,942 $0 Index Readmissions PAC Other All figures based on standardized dollars 18 Distribution of Spending PAC is a much larger share of episode spending for MS-DRG 470 100% 90% 80% 70% 5% 3% 9% 12% SNF 48% $7,663 36% 23% 60% HH 28% $3,770 $ , 50% LTCH 1% 40% 30% Therapy 7% 56% 56% All Episodes MS-DRG 470 $16,083 $21,325 IRF 16% 20% 10% 0% Avg Spending Per Episode p Index PAC Readmissions Other Limited to episodes where the beneficiary survived the index admit 19 Distribution of Episodes by First/Second Service Used after Discharge 1st Service After Index 2nd Service After Index Service % of Total None Therapy HHA SNF IRF LTCH Acute Admit None 7.1% 7.1% -- -- -- -- -- -- Therapy 11.4% 10.8% -- 0.1% * * -- 0.4% HHA 35.2% 15.1% 18.7% -- 0.1% * * 1.2% SNF 36.3% 5.0% 9.1% 18.9% 0.9% 0.1% * 2.4% IRF 9.5% 0.8% 2.4% 5.2% 0.7% * * 0.4% * * * * * * -- * 0.5% 0.2% 0.1% 0.1% 0.1% * * * 100.0% 39.0% 30.3% 24.3% 1.8% 0.1% * 4.4% LTCH Acute Admit Episodes that accounted for less than 0.1% of the total are marked with an asterisk Limited to episodes where the beneficiary survived the index admit 20 Average Episode Cost by First/Second Service Used after Discharge 1st Service After Index 2nd Service After Index Avg. Episode Cost None Therapy HHA SNF IRF LTCH Acute Admit None $9 301 $9,301 $9 301 $9,301 -- -- -- -- -- -- Therapy $14,000 $13,551 -- $18,196 * * -- $24,281 HHA $16,920 $15,689 $17,088 -- $27,202 * * $28,548 SNF $27,154 $24,860 $23,388 $26,729 $36,345 $40,065 * $45,865 IRF $32,746 $25,466 $26,887 $32,595 $50,015 * * $52,724 * * * * * * -- * $24,319 $15,732 $20,609 $24,463 $36,599 * * * $21,325 $15,311 $19,764 $27,944 $41,405 $39,711 * $39,881 Service LTCH Acute Admit Episodes that accounted for less than 0.1% of the total are marked with an asterisk Limited to episodes where the beneficiary survived the index admit 21 Average Episode Cost by HRR National Average = $21,325 Hackensack, NJ $29,254 A h AK Anchorage, $15,222 Ratio to National Average Limited to episodes where the beneficiary survived the index admit 22 Outlier HRRs Average % of “No Episode p PAC” Length Episodes High Outlier HRRs* HRRs 69 All HRRs 56 Low Outlier HRRs* 46 3.4% 7.1% 15 6% 15.6% Share of PAC Episode Dollars Going to . . . SNF HHA IRF Therapy LTCH 46.40% 22.60% 24.00% 6.60% 0.40% ($5,217) ($2,505) ($2,825) ($724) ($42) 47.90% 16.20% 7.20% 0.50% ($3,986) ($2,345) ($1,344) ($595) ($46) 54 00% 54.00% 28.20% 24 00% 24.00% 11 10% 11.10% 10 80% 10.80% 0 10% 0.10% ($3,112) ($1,332) ($648) ($601) ($6) *Outlier HRRs had spending that was 15% above / below the national average. Limited to episodes where the beneficiary survived the index admit 23 Average Episode Length Rochester, MN 29 days National Average = 56 days Hackensack, NJ 78 days Ratio to National Average Limited to episodes where the beneficiary survived the index admit 24 Percent of Episodes without PAC services Missoula, MT 29.2% National Average = 7.1% Worchester, MA 1.8% Limited to episodes where the beneficiary survived the index admit 25 Average PAC Cost (for Episodes with PAC spending) National Average = $8,295 Hackensack, NJ $14,363 A h AK Anchorage, $4,187 Ratio to National Average Limited to episodes where the beneficiary survived the index admit 26 Real-Time Real Time Reporting of Medicare Readmissions Data Niall Brennan g Director, Offices of Enterprise p Management g Acting Why CMS is Focused on Readmissions ● Nearly one in five fee-for-service Medicare patients returns to the hospital within 30 days of being discharged 2 million readmissions each year 139,000 beneficiaries had 3 or more readmissions in 2012 ● High readmission rate can be indicator of poor quality care ● Readmissions estimated to cost Medicare $26 billion per-year, per year, $17 billion of which is potentially avoidable ● Examples of CMS initiatives to reduce readmissions: Hospital Readmissions Reduction Program Partnership for Patients Shared savings programs Quality Improvement Organizations 28 OIPDA Readmission Rate Methodology ● Source: 100% Medicare claims from Chronic Conditions Warehouse ● Medicare fee-for-service beneficiaries enrolled in Part A ● All acute care hospitals (IPPS and CAH) ● Index stay = impatient admission where patient did not die in hospital ● Readmission stay = inpatient admission within 30 days of discharge from index stay ● Stays can count as both index admission and readmission ● Readmission is attributed to the month of index stay and location of facility where index admission occurred ● Not risk adjusted 29 Real-Time Reporting of Readmissions Data ● Takes up to 13 months for all Medicare claims to reach final action status ● OIPDA adjusts preliminary readmissions data to compensate for claims that have not reached final action ● Can report reliable monthly readmissions data after just 2 months of claims run run-out out Far faster than other types of reporting Difficult to perform risk adjustment on real-time basis ● Timely reporting improves feedback to CMS programs and h l enable helps bl faster f quality li iimprovement 30 Claims Maturity for Index and Readmission Stays For a Typical Month 100% 800 80% 600 60% 400 40% 200 20% 0 Percentt of Final S Stays Nu umber of S Stays (in th housands) 1,000 0% 1 2 3 4 5 6 7 8 9 10 11 12 13 Months of Claim Run-Out Run Out Index Admission Stays % Index Admissions Processed Readmission Stays % Readmissions Processed 31 Improvement in Readmission Rate Among Medicare FFS Beneficiaries ● After holding steady at 19% over 2007-2011 period, national readmission rate started falling in 2012 18.5% in 2012 and 17.9% in 2013 ● Improvement has been broad-based across geography, demographics, and clinical conditions ● Estimate 150,000 fewer readmissions occurred during 2012-2013 than if readmission rate had remained at 19% ● Reduction in inpatient readmissions does not seem to be driven by substitution by outpatient ED visits or observation stays 32 Medicare 30-Day, All-Condition Readmission Rate January 2007 – February 2014 20% Readmiss sion Rate 19% 19.0% (2007-2011) 18% 18.5% (2012) 17.9% (2013) 17% 16% 2007 2008 2009 Monthly Readmission Rate 2010 2011 2012 2013 Mean Rate for Period 33 Medicare 30-Day, All-Condition Readmission Rate January 2007 – February 2014 20.0% 19.5% Readmission Rate e 19.0% 18.5% 18.0% 17.5% 17.0% 16.5% 16.0% % J F M A M J J A S O N D Month 2007-2011 2012 2013 2014 34 Annual Change in Hospital Services 30 Days Post Inpatient Discharge ● Hospital outpatient services growing more slowly than readmissions have been declining Ch hange in N Number of S Stays/Visitts 60,000 40,000 20,000 0 -20,000 Inpatient Readmissions -40,000 Post-Discharge ED Visits -60,000 Post-Discharge Observation Stays -80,000 -100,000 -120,000 2008 2009 2010 2011 2012 35 Change in Medicare All-Condition Readmission Rate 2007-2011 Mean to 2013, 2013 by Hospital Referral Region Change in national rate = -1.1 percentage point 36 Medicare All-Condition Readmission Rate by Age 24% Readmiss sion Rate 22% Under 65 20% 65 69 65-69 18% 70-79 80 and older 16% 14% 2007 2008 2009 2010 2011 2012 2013 37 Medicare All-Condition Readmission Rate by Race 26% Readmissiion Rate 24% Black 22% Hispanic p 20% Other 18% Non-Hispanic White 16% 14% 2007 2008 2009 2010 2011 2012 2013 38 Medicare All-Condition Readmission Rate by Hospital Size ● Smaller hospitals started with lower rates, but have also seen the largest reductions 22% Re eadmission Rate 20% 18% 2011 16% 2013 2011 Mean 14% 2013 Mean 12% 10% 1-49 50-99 100-199 200-299 300-399 Number of Beds Per-Hospital 400-499 500+ 39 Annual Percentage Point Change in Readmission Rate by DRG Type ● Rates have decreased across different types of services Perc centage Poin nt Change in n Readmissio on Rate 0 2% 0.2% 0.1% 0 0% 0.0% -0.1% -0.2% Medical DRGs -0.3% Surgical DRGs -0.4% -0.5% -0.6% -0.7% 2008 2009 2010 2011 2012 2013 40 Medicare Readmission Rate for Selected Conditions ● These conditions represent about half of total readmission stays 30% Readmission Ratte 25% 20% 15% 2011 2013 10% 5% 41 Hospital Readmissions Reduction Program (HRRP) ● Section 3025 of the Affordable Care Act ● Reduces Medicare payments to IPPS hospitals with excess readmissions ● Started by measuring heart failure, failure acute myocardial infarction infarction, and pneumonia Payment adjustments began in FY 2012 ● CMS proposing to expand measures to include COPD and elective hip and knee replacement p 5 conditions represent 20% of all readmissions Payment adjustments based on all 5 measures would start in FY 2015 ● Readmission rates for these conditions have gone down, but improvement is not limited to these conditions p 42 Medicare Unplanned Readmission Rate for Conditions Measured by HRRP 28% Readmis ssion Rate e 26% 24% CHF 22% COPD AMI 20% Pneumonia 18% All Other 16% 14% 2007 2008 2009 2010 2011 2012 2013 Readmission rate for elective hip and knee replacement fell from 4.7% in 2011 to 3.8% in 2013 (not shown). 43
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