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What We’re Watching: June 11, 2019


Health systems interested in exploring participation in CMS’s Primary Cares First and Direct Contracting models must submit a non-binding Letter of Interest (LOI) by August 2.

What we’re saying: Two of the biggest unknowns around the Direct Contracting models remain the benchmarking and risk-adjustment methodologies, which we’ve been told will be released as part of the request for applications, in the next month or two. The Direct Contracting model is the most ambitious CMS model representing the bipartisan focus on shifting risk from public payers to private entities. These models are the future, irrespective of changes in administration, as illustrated by a group of congressional Democrats applauding the new models. Premier hosted a webinar on this in May.


Drug shortages plague the industry, adding more than half a billion dollars in increased healthcare expenditures annually and threatening patient access to life-saving medications. One study found that prices for drugs under shortage increased more than twice as quickly as they would in the absence of a shortage adding $230 million a year to U.S. drug costs.

What we’re saying: Premier is working to eliminate shortages, however the causes are complex and solving them calls for a multipronged approach. ProvideGx is one of Premier’s market-based solutions to creating a more stable and reliable supply chain for generic drugs in short supply. Premier has also been working with key members of Congress to advance legislative solutions, an effort that is gaining bipartisan steam. These sustainable approaches include providing additional authority to the FDA to help mitigate drug shortages and developing market-based incentives to help ensure a stable supply of critical medications.


What We’re Watching is a weekly blog focused on the current events Premier is following and their relevance to the work of Premier and its members. Check out last week's update.

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