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Predicting the Healthcare Future… (with proper caveats)

This being the season of predictions (and resolutions–but that’s for another venue) On-Target thought it timely and appropriate to “take up the challenge” and weigh in on the 2011 prospects for healthcare reform generally and the Affordable Care Act (ACA) in particular.

So, acknowledging the inherent hazards of making predictions that can actually be checked and taking note of the warnings of wiser folks who have commented on the difficulty of making predictions, “especially about the future”, here goes…

Conventional wisdom holds that the November elections profoundly changed the dynamics around the implementation of the ACA. However, the practical consequences of this new reality are unclear. On the key issues of outright repeal and court challenges to the individual mandate, expect considerable rhetoric but likely less action during 2011. While the reconfigured House may well attempt (and succeed) in repealing the ACA, there is little chance the Senate will agree and additionally the virtual certainty of a Presidential veto. Thus outright repeal would be a political strategy rather than a policy initiative.

The outcome of court challenges to the individual mandate, an integral component of the ACA, are less easily predicted since the opinions of individual judges in disparate jurisdictions are involved. Lower Court disagreements will likely persist, and the overall impact of these challenges during 2011 will depend upon the willingness of the Supreme Court to grant expedited review and resolve the matter with finality. This seems highly unlikely (during 2011), so expect to see much written on the issue and enjoy the chance to learn some constitutional law from the array of distinguished legal scholars likely to “weigh-in” on the matter; however, don’t expect resolution.

In sum, the ACA is very likely to survive 2011, largely intact, but the new House may well decide to make a “statement” by passing repeal.

Finally, we examine biosimilar/interchangeable products, areas of great interest to Target Health’s clients and subjects of a “grand bargain” in the ACA. The bargain was an attempt to balance the need to support innovation by conferring sufficient product exclusivity, now promised for 12 years post licensing (not approval), with the societal benefits of competition (by offering an expedited pathway for biosimilar approval following innovator patent expiry). Ultimately, the FDA will need to “fill in” the regulatory blanks, and that process has begun with a stakeholder meeting held in late 2010. Look for this process to advance, cautiously, in 2011 with the Agency providing additional specificity around the requirements for biosimilar approval. We at Target Health shall monitor this process.

Altogether, there will be much rhetoric and a modicum of activity and the implementation of the ACA will move, perhaps a bit unsteadily, forward. We shall try and keep readers updated on the status of relevant elements of the ACA, especially those that impact the approval, marketing and reimbursement of pharmaceuticals and devices, as the negotiations progress. (Mark L. Horn, MD, MPH; CMO Target Health Inc.)

For more information about our expertise in Medical Affairs, contact Dr. Mark L. Horn. For Regulatory Affairs, please contact Dr. Jules T. Mitchel or Dr. Glen Park.

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