Top health industry issues of 2017: Reflections for compliance executives
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The inauguration of a new president in 2017 introduces additional uncertainty into the healthcare ecosystem, which is already rebounding from existing market forces altering ways of how healthcare is provided and managed. At the start of each new year, PwC’s Health Research Institute (HRI) publishes its annual Top Health Industries Issues report, which forecasts the top ten topics affecting the industry in the upcoming years adding comprehensive insights for each. Compliance implications are essential parts of these annual projections and the following are some to consider in 2017:

·  Under a new administration, the fate of the Affordable Care Act (ACA) remains unclear

How “repeal and replace” will be enacted remains difficult to predict and still unknown, though we soon expect a GOP replacement plan. However, there are topics that continue to resurface which could impact the compliance risk profile of many companies.

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Compliance leaders at healthcare providers and payers will want to prepare in a number of ways: ensure that appropriate controls exist over building tighter relationships with state regulators who may assume Federal oversight responsibilities, develop multi-state network strategies to deal with proposed loosening of cross-state insurance sale laws, and create approaches to increase pricing transparency for hospital services.

·  Pharma’s new strategic partner – patients

Patients are more involved than ever in their health, and between the 21st Century Cures Act and the FDA, there is a call for increased patient engagement in the research and clinical trials process. The expected result is better insight into the patient experience, and this trend will likely expose companies to greater risk as patient interactions and Protected Health Information exchanges expand.

Compliance teams will need to navigate an environment traditionally sparse in patient interaction regulatory guidance to develop the cross-functional infrastructure, data management protocols, social media guides, and patient interaction policies that best support company risk tolerances. Furthermore, patient organizations that have previously been critical to both the commercialization of life-altering treatments and for the influencing / approval of reimbursement decisions, will need to undergo careful review in light of a recent JAMA study questioning the nature of these organizations’ relationship with life science companies. Compliance officers will want to ensure that corporate interactions with these organizations do not present reputational or legal issues individually or in aggregate.

·  Easing the training wheels off value-based payment 

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Meeting quality standards for reimbursement means providers may rely more heavily on data analytics to identify and address risk areas early. Blending technology and clinical skills to increase efficiency and provide tailored care management solutions will drive these analytics. However, providers should also consider partnerships with compliance and technology specialists to build customized infrastructure that does not burden doctors with excessive quality metrics reporting. 

Combined with these issues are the challenges of ensuring accurate claims submission and billing, including a temptation to “game the system” through means such as false claims, improper coding, and improper billing. Ongoing risk assessment and monitoring is the key to building confidence that both the quality metrics are achieved, and that the integrity of the measurement metrics themselves are sound for obtaining a quality result.

·   Insert your card here for healthcare

Credit card payments for healthcare expenses are now more common, yet most health systems have lagged in both credit card system modernization and cybersecurity protections. Payers / Providers now updating credit card processing systems will want to include focus on increasing efficiency and improving visibility into revenue intake and management processes for internal data metrics and regulatory reporting, while also emphasizing cyberattack countermeasures to guard data and mitigate punitive fines and reputational damage.

·   The battle against infectious disease sparks invention

In 2017, millions of dollars and legislative support from initiatives such as the 21st Century Cures Act will likely expedite the development of diagnostic tests, antimicrobials and other infectious disease treatments. Aside from collaborating with regulators and public agencies to secure funding and expedite research and approval, companies should also understand the regulatory requirements involved with newly introduced programs such as the Limited Pathway for Antibiotics / Antifungals to ensure timely and compliant entrance into the market.

·   Putting the brakes – gently – on drug prices

Bipartisan populist rhetoric around rising drug costs are expected to result in action towards reducing prices. These efforts will likely pose myriad compliance consequences – balancing commercial and / or government actions taken against current government price reporting requirements, managing the impact on patient assistance programs, and enabling the production and dissemination of outcomes / value-affirming data to support negotiations while complying with existing promotional regulations. Life science compliance officers will want to assess pricing methodologies as well as public disclosures of pricing rationale to diminish risk of negative public and regulatory scrutiny. This, in addition to patient access programs - both sponsored advocacy and assistance – are seeing increased skepticism and will require clear justification.

Many healthcare and life sciences companies have already taken the lead in the conversation by: committing to single digit percent ceilings for any increase each year, limiting increases to inflation or the Consumer Price Index, or by moving towards greater price transparency by publishing historical increase information. As part of “compensation” for concessions, life sciences companies will likely want to know the benefits to pursue for these price concessions, and that these benefits are realizable given the complex regulatory and enforcement environment.

·   Paging Dr. Drone: it’s time to prepare for emerging technologies; Rx cauliflower: Nutrition takes a more central role in health; A year of new partnerships and collaborations

This year’s report highlights emerging technologies and higher interest in nutrition and wellness. These trends promote healthcare partnerships with non-traditional sectors and a more consumer-friendly healthcare environment that integrates into daily life outside of hospital walls.

However, new approaches bring new concerns, as healthcare and technology companies must decide whether to partner with, or compete against one another for limited resources. Either approach will challenge the compliance atmosphere as new questions arise: When does nutrition advice turn into medical advice, or a wellness app turn into a medical app? Will my virtual reality medical training tool constitute as a medical device? How will supply chain risk and liability be managed for a drone-based medical product delivery model? Compliance teams seeking to reduce risk will need to monitor these type of new questions, and provide ample guidance to partner entities unfamiliar with the strict healthcare compliance environment.

The impact of 2017 depends on evolving trends and anticipated action by policymakers. However, following election victories that are likely to usher sweeping policy changes, coupled with ongoing healthcare cost and value concerns, consumers and compliance officers alike should maintain a pulse on the policy arena to stay abreast with potential implications.

Peter Claude and Joseph Rogel are part of PwC Health Industries Risk & Regulatory Practice.


The views expressed by this author are their own and are not the views of The Hill.