Healthcare Financial News

Although health plans are developing tools to help consumers compare price and quality information across hospitals and physicians, the tools’ pervasiveness and usefulness are limited, according to a study released Aug. 28 by the Center for Studying Health System Change (HSC).

Responding to large employers’ interest in greater healthcare price and quality transparency, health plans generally provide some price information on inpatient and outpatient procedures and services, according to the study. However, the information often lacks specificity about individual providers, and its availability is often limited to enrollees in specific geographic areas. Likewise, few plans provide price information on services in physicians’ offices.

The study’s findings are detailed in a new HSC research brief, A Health Plan Work in Progress: Hospital-Physician Price and Quality Transparency. The study is based on HSC’s 2007 site visits to 12 nationally representative metropolitan communities: Boston; Cleveland; Greenville, S.C.; Indianapolis; Lansing, Mich.; Little Rock Ark.; Miami; northern New Jersey; Orange County, Calif.; Phoenix; Seattle; and Syracuse, N.Y. HSC has been tracking change in these markets since 1996. Read the research brief.

Medicare overpaid for irinotecan, a cancer drug sold by Pfizer under the name Campostar, by $6.5 million in March because of a delay in updating its pricing formula, according to a report released Aug. 26 by the Department of Health and Human Services Office of Inspector General. A generic version of the drug was approved for sale on Feb. 20. However, a two-month delay in integrating the new generic prices into the agency’s payment system resulted in the additional expense. According to the report, Medicare was paying $126 per dose of irinotecan in March despite average generic prices of $41 for the drug. When sales of the branded version were factored in, the drug’s average price in March was $52.

“The underlying pricing issues identified in this report are not limited to irinotecan because of the two-quarter lag in CMS’s standard process for establishing Medicare payment amounts,” says the report. “Absent a change in the standard process, Medicare payment amounts for drugs with new generic versions will continue to be temporarily higher than manufacturer sales prices, sometimes substantially.” Read the report.