Axios Vitals

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September 26, 2022

Monday's here, Vitals readers. Today's newsletter is 957 words or a 4-minute read.

1 big thing: The promise and perils of gene therapies

Illustration of a double helix made out of a $100 bill.

Illustration: Gabriella Turrisi/Axios

The era of multimillion-dollar gene therapies has arrived, providing a ray of hope to patients with debilitating diseases — but also presenting huge affordability challenges, Axios' Caitlin Owens writes.

Why it matters: Though the expected number of patients who'll likely receive the treatments is relatively low, it's unclear how small employers, state Medicaid programs, and the rest of the health system will absorb such large costs.

Driving the news: The FDA recently approved two gene therapies, doubling the number on the market for diseases other than cancer. Dozens more could be on the way in the next few years.

  • The average gene therapy is likely to cost at least $1.5 million, said Colin Young, director of drug development pipeline research at Tufts Medical Center's NEWDIGS Initiative.
  • Including oncology drugs, gene therapies could end up costing the U.S. around $30 billion a year, Young said.

The big picture: Even experts and groups generally critical of high drug prices say the cost could be justified if it delivers a lifelong cure that saves the health care system a lot of money in the long run.

  • Payers and pharmaceutical companies are both open to nontraditional payment models to cover the risk if the treatments don't work.
  • But experts say some payers may not have an incentive to provide access to a therapy that requires a one-time remittance and provides benefits over a lifetime.
  • Budget-conscious state Medicaid programs will also have to be careful about which patients they make eligible for the drugs.
  • And because gene therapies are so new, we're only in the preliminary stages of collecting data on their effectiveness.

What we're watching: The approved gene therapies to date are for rare conditions with very small patient populations. But two treatments for sickle cell disease could come onto the market as soon as next year.

Go deeper.

2. A new surprise billing court challenge

Illustration of an opened envelope with a billing statement inside and confetti spilling out.

Illustration: Aïda Amer/Axios

Providers are once again challenging the Biden administration on the surprise billing law and the method for deciding who picks up the tab in disputes over out-of-network care.

The big picture: Almost 10 months after the law protecting patients from unexpected medical bills took effect, key details have yet to be settled, with billions of dollars on the line for providers, insurers and employers.

Catch up quick: The Texas Medical Association last week sued in federal court over a final rule for implementing the law, saying it skews results in favor of insurers.

  • The same group successfully challenged an earlier version in court, saying it unfairly favored insurers by telling arbiters to select the rate closest to the health plans' median in-network rates for the same or similar services in the geographic region.
  • The Labor Department, the Health and Human Services Department and the IRS last month redefined the factors arbitrators have to weigh, saying they no longer have to start with that median in-network rate.

What we're watching: The court has to decide if the latest rule deprives physicians and providers of the arbitration process the law intended. Whatever the outcome, it likely will not be the final word on surprise billing.

3. Data du jour: Substance use disorders in the COVID era

Data: FAIR Health; Map: Erin Davis/Axios Visuals

While men were far likelier to be diagnosed with a substance use disorder during the pandemic, women were more likely to overdose, Axios' Tina Reed writes from a new FAIR Health analysis provided to Axios.

Why it matters: The study of private insurance claims shows the rising burden of substance use across the U.S.

The percentage of patients with a substance use disorder diagnosis decreased from 3.5% of all patients in 2019 before the pandemic to 3.4% in 2021.

Yes, but: The number of patients with an overdose diagnosis increased 4.3%.

  • From 2019 to 2021, 42 states saw an increase in the proportion of patients with opioid and opioid-like drug overdoses compared to the total number of patients using medical services, ranging from 148.4% in Pennsylvania to 0.7% in Minnesota.
  • New Mexico and Oklahoma had the highest proportion of patients with an overdose diagnosis over that period.
  • Between 2016 and 2021, about 62% of substance use disorder diagnoses were among males. 
  • In that same period, about 60% of overdose diagnoses were among females.

4. Arizona's murky abortion picture

Arizona produced the latest fault line in the post-Roe landscape — and no small amount of confusion — when a judge on Friday allowed a pre-statehood law banning almost all abortions to take effect.

Why it matters: The decision further elevates reproductive health as an issue in a key battleground state just over six weeks before the midterms.

Catch up fast: The law stipulates a two- to five-year prison sentence for anyone who helps someone obtain an abortion. A longstanding injunction had blocked its enforcement.

  • Abortion providers in Arizona temporarily halted services after the Supreme Court overturned Roe v. Wade, but many recently resumed them, writes Axios' Mark Robinson.

What they're saying: "The potential consequences of this ruling are catastrophic, dangerous and unacceptable," White House press secretary Karine Jean-Pierre said in a statement.

But the pre-statehood law conflicts with others regulating abortion in Arizona that were enacted since the 1970s, including ones that allow abortions in medical emergencies, Barbara Atwood, a law professor emerita at the University of Arizona, told the Washington Post.

  • Planned Parenthood Arizona argues that more permissive laws that state lawmakers had adopted should take effect.
  • "It is an unworkable situation," Atwood said, predicting further legal and legislative battles.

5. While you were weekending

Illustration of a desk on a beach under a palm tree.

Illustration: Aïda Amer/Axios

🏥 Many of the biggest nonprofit hospital systems have drifted away from their charitable roots, fixating on revenue targets and expansions into affluent suburbs. (New York Times)

💵 A short-term funding bill to prevent a government shutdown faces uncertain prospects with days to go. (Wall Street Journal)

🏛 CDC director Rochelle Walensky defended her agency's efforts to collect and disseminate COVID data, but added it has to restore and regain the public's trust. (STAT)

Big thanks to Bryan McBournie for copy editing the newsletter.