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Post by dreamboatcruise on May 22, 2018 19:36:36 GMT -5
There are more than one model and a lot of complications, but you're referring to the difference between the health plan organization and the Pharmacy Benefit Manager (PBM). We wen't through a whole wave in the industry where health plan organizations outsourced the pharmacy benefit management to 3rd party companies. Now some health plan insurers are (or considering) bringing it in house again. The model of having independent PBMs certainly did not result in the cost savings they claimed was their raison d'etre. From a consumer standpoint it looks an awful lot like a total scam. Your comment is more precise than mine. Afrezza will save insurance companies lots of money by avoiding a whole host of diabetes-related costs, but the 3rd party PBMs who control access to Afrezza don't care because they make their money on drug discounts and rebates. Duh... I'd hadn't realized that most PBMs are third parties that have little incentive to support a drug like Afrezza that saves their insurance company employers money, but doesn't generate any meaningful revenues for them. I'm not sure MNKD can win that battle. Afrezza has nothing to offer PBMs... Sigh... There is one class of payer for which the equation is very different... large employers that are self insured. They actually don't have anybody to easily pass those costs onto. They also have a lot of power to change formularies for their covered employees. However, I think in the past they've relied too much on the PBMs to make decisions for them. I'd encourage anyone that is or knows a patient desiring Afrezza working for a large company to contact HR... they may well be self insured and have the power to demand their PBM add Afrezza, and even if they aren't self insured, it's good to register ones dissatisfaction. |
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Post by kball on May 22, 2018 19:49:00 GMT -5
I thought i could. I thought i could.
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Post by boca1girl on May 22, 2018 20:37:45 GMT -5
bill - Maybe that's why MNKD has kept the list price of Afrezza so high - so that they can rebate money to PBM's. I think Mike knows the game he must play to get widespread insurance coverage. Unfortunately, it screws the cash-paying patients. I remember Mike describing this pricing problem on a shareholder’s call (not an earnings call) a couple of years ago before he became the CEO. That was the first time I heard about the rebates to the PBMs. A bit later we heard him talk about how surprisingly large the cash paying population was and thoughts of a subscription service like OneDrop with test strips. |
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Post by bill on May 22, 2018 20:43:38 GMT -5
bill - Maybe that's why MNKD has kept the list price of Afrezza so high - so that they can rebate money to PBM's. I think Mike knows the game he must play to get widespread insurance coverage. Unfortunately, it screws the cash-paying patients. I remember Mike describing this pricing problem on a shareholder’s call (not an earnings call) a couple of years ago before he became the CEO. That was the first time I heard about the rebates to the PBMs. A bit later we heard him talk about how surprisingly large the cash paying population was and thoughts of a subscription service like OneDrop with test strips. @liane Maybe Mike C and Dr. K need to create a new pitch for the insurance companies and self-insured employers that points out their BPMs interests are not aligned with their interests or their covered PWDs when it comes to Afrezza. Afrezza will lower their costs and improve the quality of life for PWDs, but their BPMs are not approving it because it doesn't benefit their bottom-line. Thoughts on the idea and whether it's worth passing on to Mike C? |
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Post by dreamboatcruise on May 22, 2018 21:14:00 GMT -5
I remember Mike describing this pricing problem on a shareholder’s call (not an earnings call) a couple of years ago before he became the CEO. That was the first time I heard about the rebates to the PBMs. A bit later we heard him talk about how surprisingly large the cash paying population was and thoughts of a subscription service like OneDrop with test strips. @liane Maybe Mike C and Dr. K need to create a new pitch for the insurance companies and self-insured employers that points out their BPMs interests are not aligned with their interests or their covered PWDs when it comes to Afrezza. Afrezza will lower their costs and improve the quality of life for PWDs, but their BPMs are not approving it because it doesn't benefit their bottom-line. Thoughts on the idea and whether it's worth passing on to Mike C? I think insurers' incentives may not be as aligned with patients as you might think. In many places there are at best a few major insurance options so the competition isn't... robust. They are often regulated, and in places like CA that means there is a limitation on the amount of "profit" they can make. That profit limit is based as a percentage of the premiums they charge. Premiums go up... profit goes up. Premiums go down... profit goes down. If expenses, such as paying for drugs go up, the next year they can charge more for the premium and voila, more profit. That's one theory about our broken system... no need for actual collusion but if everyone plays by the same game book they all are prosperous. Though you also see insurance denying coverage of things, making it seem as if controlling costs for those paying the premiums is a factor. My personal guess is that insurance companies want steady predictable health care cost increase over time... setting aside political risk that if they do it too much there could be a backlash and detrimental changes in regulations for them. With self insured employers the equation is pretty clear. [Edit: though I do agree some companies may well view as Aged states below. Only thing clear would be that employers right now are getting shafted by the rebate system. That and the fact that if reasonably short term cost savings could be shown such as reduced hospitalizations for hypos, self insured employers actually do have incentives aligned with their employees.] |
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Post by agedhippie on May 22, 2018 21:14:08 GMT -5
I remember Mike describing this pricing problem on a shareholder’s call (not an earnings call) a couple of years ago before he became the CEO. That was the first time I heard about the rebates to the PBMs. A bit later we heard him talk about how surprisingly large the cash paying population was and thoughts of a subscription service like OneDrop with test strips. Maybe Mike C and Dr. K need to create a new pitch for the insurance companies and self-insured employers that points out their PBMs interests are not aligned with their interests or their covered PWDs when it comes to Afrezza. Afrezza will lower their costs and improve the quality of life for PWDs, but their PBMs are not approving it because it doesn't benefit their bottom-line. Thoughts on the idea and whether it's worth passing on to Mike C? The average length of employment is around 5 years and then you become someone else's problem. That's not even long enough to develop complications. Working this through - if I am the first employer in the chain I don't want to use insulin because metformin is a lot cheaper and bad things are not going to happen yet so I save the cost. Now I am the second employer in the chain, I inherit an employee who is accumulating damage, but probably not noticeably so lets stick with the non-insulin, or maybe the basal option and save money. The third employer catches it. We are 10 years in and complications are appearing, probably neuropathy, and maybe some level of retinopathy. This is where earlier treatment would have started to pay back. By now treatment is expensive, probably drugs and MDI so they are on insulin. It is from the third employer onward where there may be an option for Afrezza, but since the damage is done so why argue with the PBM over brands of insulin - the damage is done so go with the cheapest option. Maybe I am being unduly cynical but I cannot see an upside for the company in using Afrezza from the start. If I am a good guy and do it I am just subsidizing the companies that don't since they get the benefit and not the cost. The PBM provides the excuse since they claim to be the pharmaceutical experts so the company is applying best practice. |
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Post by peppy on May 22, 2018 21:37:37 GMT -5
Maybe Mike C and Dr. K need to create a new pitch for the insurance companies and self-insured employers that points out their PBMs interests are not aligned with their interests or their covered PWDs when it comes to Afrezza. Afrezza will lower their costs and improve the quality of life for PWDs, but their PBMs are not approving it because it doesn't benefit their bottom-line. Thoughts on the idea and whether it's worth passing on to Mike C? The average length of employment is around 5 years and then you become someone else's problem. That's not even long enough to develop complications. Working this through - if I am the first employer in the chain I don't want to use insulin because metformin is a lot cheaper and bad things are not going to happen yet so I save the cost. Now I am the second employer in the chain, I inherit an employee who is accumulating damage, but probably not noticeably so lets stick with the non-insulin, or maybe the basal option and save money. The third employer catches it. We are 10 years in and complications are appearing, probably neuropathy, and maybe some level of retinopathy. This is where earlier treatment would have started to pay back. By now treatment is expensive, probably drugs and MDI so they are on insulin. It is from the third employer onward where there may be an option for Afrezza, but since the damage is done so why argue with the PBM over brands of insulin - the damage is done so go with the cheapest option. Maybe I am being unduly cynical but I cannot see an upside for the company in using Afrezza from the start. If I am a good guy and do it I am just subsidizing the companies that don't since they get the benefit and not the cost. The PBM provides the excuse since they claim to be the pharmaceutical experts so the company is applying best practice. I think you nailed it. Terrible system. Our terrible system. Throw on top of it, a share of employers getting rid of people over 55 years of age. |
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Post by nylefty on May 22, 2018 21:50:38 GMT -5
Most large employers are self-insured and that includes corporations, state and local governments and the federal government -- so all the emphasis on "insurance companies" on this board may need another look. In my case, I've been covered by GE's health and drug plans since 1975, while I was working there and now in retirement. GE has used three different PBMs during that time (it switched from CVS Caremark to OptumRx last year). GE uses UnitedHealthcare to administer its health plan (for current employees and retirees). www.investors.com/politics/commentary/self-insured-companies-help-push-health-care-innovations/
Mar 22, 2017
Self-insurance has long been the coverage model of choice for large companies.
Eighty percent of those with more than 500 employees self-fund their health plans. But it's becoming more popular for smaller companies, too. The number of midsize firms who self-insure has jumped 19%; the number of small firms, 7%. Sixty percent of Americans with employer-sponsored health benefits are on self-insured plans.
Self-insured companies pay only for the medical services and treatments their employees need — plus any administrative costs associated with running their plans. When overall expenses are less than expected, employers, employees, and their families pocket the savings.
Self-insured businesses also have considerable freedom to adopt innovative models for delivering care. That's great news for workers and their families, since many of these new approaches are much more convenient — and effective. |
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Post by boca1girl on May 23, 2018 7:38:50 GMT -5
The average length of employment is around 5 years and then you become someone else's problem. That's not even long enough to develop complications. Working this through - if I am the first employer in the chain I don't want to use insulin because metformin is a lot cheaper and bad things are not going to happen yet so I save the cost. Now I am the second employer in the chain, I inherit an employee who is accumulating damage, but probably not noticeably so lets stick with the non-insulin, or maybe the basal option and save money. The third employer catches it. We are 10 years in and complications are appearing, probably neuropathy, and maybe some level of retinopathy. This is where earlier treatment would have started to pay back. By now treatment is expensive, probably drugs and MDI so they are on insulin. It is from the third employer onward where there may be an option for Afrezza, but since the damage is done so why argue with the PBM over brands of insulin - the damage is done so go with the cheapest option. Maybe I am being unduly cynical but I cannot see an upside for the company in using Afrezza from the start. If I am a good guy and do it I am just subsidizing the companies that don't since they get the benefit and not the cost. The PBM provides the excuse since they claim to be the pharmaceutical experts so the company is applying best practice. I think you nailed it. Terrible system. Our terrible system. Throw on top of it, a share of employers getting rid of people over 55 years of age. All of the above excuses for not supporting Afrezza early on is why we need a national health care system. Only then will “we” be responsible for the long term health care of all of “us”. But assuming a national health plan is still years away, my near term hope is that Afrezza becomes the standard of care and then Mannkind drops the price so that cash payers can afford it and “payers” would cover it at at Tier I. |
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Post by Deleted on May 23, 2018 10:48:34 GMT -5
Speaking of late breaking posters accepted by the ADA, did you know that according to Dr. Kendall they only accept approx. 10% of those late breaking submissiions, which to me says they were impressed enough by the reduced hypo's when compared to aspart numbers that they thought it was 90% more important then the other submissions.  I heard the doc say that, Joey, and you mean they don't do it strictly by lot, but by merit?
Gotta love a 7 game series in the East!!!! Hope they continue to pound each other!
Winner of tonights game will take the series. If the rustbelt team wins tonight, they will close it out game 6. If they don't win, it will be Celts on to the finals in 7. |
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Post by Deleted on May 23, 2018 10:52:34 GMT -5
@scotta @sportsrancho Based on some DMs with Mike C. I've come to understand that there are two halves to the insurance companies. My interpretation of those DMs are that one half handles the fees and payments, and the other handles the drug coverage, pricing, and rebates. It seems the part of the insurance company we want to change is the one that handles drug coverage, but the part where we save the insurance companies money is the half that handles the payments. The two halves have their own profit / loss metrics and our trying to obtain change from the drug coverage half by saving the payments portion money has not worked and may not ever work if that's actually how things work. Instead, our best hope may be to get the Standard of Care changed. When Dr. K starts using words like barbaric in his presentations, folks might actually start to listen. There are more than one model and a lot of complications, but you're referring to the difference between the health plan organization and the Pharmacy Benefit Manager (PBM). We wen't through a whole wave in the industry where health plan organizations outsourced the pharmacy benefit management to 3rd party companies. Now some health plan insurers are (or considering) bringing it in house again. The model of having independent PBMs certainly did not result in the cost savings they claimed was their raison d'etre. From a consumer standpoint it looks an awful lot like a total scam. Will be interesting to see what, if anything Amazon does in the Rx space. They have been adding experienced people to that new business and supposedly they are going to start their own PBM. That would be as they say, disruptive. |
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Post by babaoriley on May 23, 2018 11:57:01 GMT -5
I heard the doc say that, Joey, and you mean they don't do it strictly by lot, but by merit?
Gotta love a 7 game series in the East!!!! Hope they continue to pound each other!
Winner of tonights game will take the series. If the rustbelt team wins tonight, they will close it out game 6. If they don't win, it will be Celts on to the finals in 7. Sorry, Scotta, Joey and I were talking real sports! Celtics? |
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Post by joeypotsandpans on May 23, 2018 12:45:30 GMT -5
Winner of tonights game will take the series. If the rustbelt team wins tonight, they will close it out game 6. If they don't win, it will be Celts on to the finals in 7. Sorry, Scotta, Joey and I were talking real sports! Celtics? 
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Post by agedhippie on May 23, 2018 14:48:29 GMT -5
There are more than one model and a lot of complications, but you're referring to the difference between the health plan organization and the Pharmacy Benefit Manager (PBM). We wen't through a whole wave in the industry where health plan organizations outsourced the pharmacy benefit management to 3rd party companies. Now some health plan insurers are (or considering) bringing it in house again. The model of having independent PBMs certainly did not result in the cost savings they claimed was their raison d'etre. From a consumer standpoint it looks an awful lot like a total scam. Will be interesting to see what, if anything Amazon does in the Rx space. They have been adding experienced people to that new business and supposedly they are going to start their own PBM. That would be as they say, disruptive. At annual shareholder meeting of Berkshire Hathaway Buffett said they expect to recruit the CEO in the next couple of months. The company will cover employees in Amazon, JPMC, and some number of Berkshire Hathaway companies - about 1 million people in all. They will cover healthcare top to bottom, not just PBMs. |
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Post by dreamboatcruise on May 23, 2018 16:05:02 GMT -5
There are more than one model and a lot of complications, but you're referring to the difference between the health plan organization and the Pharmacy Benefit Manager (PBM). We wen't through a whole wave in the industry where health plan organizations outsourced the pharmacy benefit management to 3rd party companies. Now some health plan insurers are (or considering) bringing it in house again. The model of having independent PBMs certainly did not result in the cost savings they claimed was their raison d'etre. From a consumer standpoint it looks an awful lot like a total scam. Will be interesting to see what, if anything Amazon does in the Rx space. They have been adding experienced people to that new business and supposedly they are going to start their own PBM. That would be as they say, disruptive. Maybe they could shave a little expense from the mail order pharmacy part of that. I'd question whether they really have anything to contribute that would be disruptive regarding PBM business. Those are already business with large scale. |
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