Skip to main content
The Keckley Report

The Lown Institute-AHA Showdown: Does it Make a Difference?

By April 1, 2024No Comments

Last week, Lown Institute released its latest report about hospital charity care concluding “80% of all nonprofit hospitals’ charity care falls behind tax breaks” based on 2021 IRS data for 2425 NFP hospitals it analyzed. Headline findings in this report include:

  • ‘Hospitals spent 3.87% of their budget on “community investments”, on average, but this proportion varied widely from less than 1% at some facilities to nearly 9% at others. In 5 states – Michigan, West Virginia, Louisiana, Washington and Rhode Island – 97% or more of all hospitals have a fair share deficit vs. 5 states in which a majority of hospitals have a fair share surplus: Delaware, Montana, Maryland, Texas and Utah.’
  • ‘In last year’s report, the Lown Institute found 77% of nearly 1,800 nonprofit hospitals received more in tax break benefits than they gave back in community support, based on 2020 IRS data. Tuesday’s report included data from more than 650 additional hospitals.’
  • ‘The combined fair share deficit for all hospitals included is $25.7 billion for 2021– enough to erase 29% of the country’s total medical debt, as reported on the Consumer Financial Protection Bureau’s Consumer Credit Panel.’

The American Hospital Association, which represents investor-owned, public and not-for-profit hospitals, replied: “Though the Lown Institute’s so-called Fair Share report highlights the important contributions of certain hospitals, it misses the larger point, selectively relying on isolated data to paint a negative picture about the hospital field in general… The most recent full year of data show that tax-exempt hospitals provided $129 billion in total benefits to their communities in 2020 alone. Said another way, every dollar invested in non-profit hospitals results in $9 in benefits delivered back to the community, according to a study by the accounting firm, EY.”

Sound familiar? It should. It’s the annual tit-for-tat exchange between the two. Lown Institute operates alongside Arnold Ventures, Patient Rights Advocate and West Health as privately-funded think tanks committed to bringing greater transparency and public accountability to hospital business practices. Collectively, the four horsemen conduct studies and sponsor events that spotlight what they each deem shortcomings of the hospital industry. They stir the pot.

Lown’s Fair Share calculus is focused on charity care and community benefits using its proprietary methodology about which AHA takes exception.  LI includes some IRS Schedule H designated “community investment” categories (financial assistance, community health improvement services, cash and in-kind contributions, community building activities, and subsidized health services) but excludes others including of the Medicaid shortfall, health professions education and research. And understandably, market factors like population health status and demography, insurance coverage, payer reimbursement and key characteristics of hospitals (programs, size, location) are not considered in LI’s analysis nor others.  “Community investment” is a fuzzy term not adequately defined by the IRS nor consistently understood in the communities served.    

Trade association 101 is about opening doors that facilitate access to markets for members and fighting regulations that threaten their future. They collect dues from members and fees from vendors, consultancies and third parties to fund their programs, build alliances, sponsor research and fend off threats from disgruntled members, upstart coalitions and unwelcome attention from groups like Lown. In responding aggressively to Lown’s study, AHA is acting responsibly on behalf of its members. But the reality is this:

The issues around charity care, community benefits and tax exemptions for hospitals is more complex than this showdown between Lown and AHA reflects.: For 15 years, academicians, health services researchers, consultancies, government agencies and trade groups have investigated the association between the tax exemption and the community benefit provided. I reviewed 20+ peer reviewed and trade association sponsored studies in preparing this post and studied Lown’s 31-page methodology. My conclusions are these:

  • Current measures and methods for calculating charity care and the IRS Schedule H community benefits activities are inadequate lending to disinformation/misinformation/sensationalism in covering hospital business practices. Powerful AI tools can be used to expand inputs in models more reflective of unique market conditions and hospital characteristics. Current methods are blunt instruments.
  • Lown’s methodology is sophisticated and defensible based on its proprietary inclusion criteria for weighting factors used in its Index. AHA’s assertion that Lown’s methodology excludes community investments for Medicaid shortfalls, research and workforce development is also defensible. Both are useful.

The issue is not going away. That’s the result of three confluent trends:

  • Increased access to hospital data: Historically, government data and self-reporting by hospitals were primary sources. Today, sophisticated analyses using AI and datasets like Triilliant, Definitive, Turquoise advance what’s known and expand access beyond traditional hospital audiences.
  • Increased coverage across multiple media platforms by healthcare-experienced journalists: Names like Bob Herman, Alex Kacik, Rachel Cohrs, Blake Madden, Casey Ross, Reed Ebelson, Anna Wilde Matthews, David Johnson, David Burda, Eric Topol, Melanie Evans, Tara Bannow, Caroline Hudson, and others are associated with media coverage about the business of healthcare. They dissect studies, compare methodologies, study rules and regulations and understand the hospital landscape: it’s expected by their editors. Assessing methodological bias in studies sponsored by trade groups or think tanks is standard operating procedure.
  • Increased public interest: Per Gallup’s March 2024 polling, healthcare affordability is one of the top issues on voters’ minds in Campaign 2024. The steady flow of stories about surprise hospital bills, prices, debt collection practices, private equity alliances, executive compensation and others lend to public confusion. Thus, reports about hospital business practices by organizations like Lown Institute, West Health, Patient Rights Advocate and Arnold Ventures get the attention of journalists, regulators and community leaders.

My take:

The hospital industry is big, influential, respected and important but it’s not invincible. Unflattering attention to hospital business practices is the new normal. Beyond upskilling Boards and Management on media relations, two mandates are clear:

  • Regulatory modernization of definitions, rules, regulations and standardization of reporting for hospital charity care, value, community benefit and tax exemption.
  • Re-definition of the role hospitals should play in systems of health in which business practices are standardized and transparent, public health services are fully integrated and value is defined specifically and measured consistently.

The showdown between Lown and AHA will make a difference only if it prompts regulators and industry leaders to address these mandates.



Why Not-for-Profit Hospitals are Soft Targets April 18, 2022 Why Not-for-Profit Hospitals are Soft Targets – Paul Keckley

About – Lown Institute


Home | West Health

Our work | Arnold Ventures

Study says nonprofit hospitals fall short in charity care spending ( March 26, 2024

Hospital Charity Care: How It Works and Why It Matters | KFF

Tax-Exempt Hospitals and Charity Care: Should Those Hospitals Do More? | Tax Policy Center July 7, 2021

Nonprofit Hospitals No Better than For-Profits on Charity Care – Non-Profit News | Nonprofit Quarterly August 7, 2015

Tax exemptions for nonprofit hospitals: a bad deal for taxpayers? – STAT (

3 Strategic Differences Between Nonprofit and For-Profit Hospitals | HealthLeaders Media

There is Nothing ‘Fair’ about the Lown Institute’s ‘Fair Share’ Report | AHA News

Inside the rise and fall of Steward’s Ralph de la Torre ( March 29, 2024

After Appalachian Hospitals Merged into a Monopoly, Their ERs Slowed to a Crawl – KFF Health News

STAT Healthcare Inc March 25, 2024

Why Americans Have Lost Faith in the Value of College – WSJ

Charitable Hospitals – General Requirements for Tax-Exemption Under Section 501(c)(3) | Internal Revenue Service (

Annual filing and forms | Internal Revenue Service (

The Estimated Value of Tax Exemption for Nonprofit Hospitals Was About $28 Billion in 2020 | KFF

Hospital charity care falls short of nonprofit tax breaks: Lown | Modern Healthcare




Sections in Today’s Industry News Update

  • Quotables from Last week
  • Care Management
  • Hospitals
  • Insurers
  • Investing
  • Physicians
  • Politics
  • Polling
  • Prescription Drugs
  • Public Health
  • Regulator Reports


Re: Primary care: “The U.S. spent 4.7% of its total health care spending on primary care in 2021 compared to an average of 14% in other high-income countries. Greater financial support for primary care, including physicians and their care teams, would give providers greater resources to expand access through telehealth, home visits, and after-hours appointments, and make care more comprehensive by addressing behavioral health and social needs. More than 20 states have increased investment in primary care in recent years, and there are opportunities for supportive federal policy action, like updating the Medicare physician fee schedule.”

Finger on the Pulse: Primary Care in U.S. and Nine Other Countries | Commonwealth Fund


Re: CMS’ Primary Flex Model: “Earlier this month, the CMS Innovation Center released the ACO Primary Care Flex Model (Model). The announcement was well received… Specifically, the Model provides an important opportunity for MSSP ACOs to move away from the fee-for-service chassis, a direction desired by many.  However, as with most Innovation Center models, the devil is in the details…

As designed, the Model excludes high revenue MSSP ACOs from participation. The debate over the need for a high revenue/low revenue distinction in the MSSP ACO program has existed for some time…

ACOs are more deeply engaged with multi-specialty practices, so excluding high revenue ACOs will likely force some of them to drop specialists or otherwise risk departure of primary care clinicians to join low revenue MSSP ACOs. When coupled with other policies that have disproportionately negative impacts on multi-specialty ACOs, excluding high revenue ACOs may result in MSSP ACO withdrawals altogether.”

Health Care Transformation Task Force Newsletter – March – – Mail (


Re: Medical debt and health status: “An estimated 8% of US adults, or about 20 million people, live with medical debt of at least $250, based on recent survey results from the nonprofits Peterson Health Center and KFF (formerly Kaiser Family Foundation). The majority of those with medical debt owe more than $1000. Now, a study that examined data from 93% of US counties found that the burden of unpaid medical bills might be affecting physical and mental health as well as shortening lives.

The researchers found that every 1-percentage point increase in medical debt—defined as bills sent to a third-party collector or assigned to a creditor’s internal collections department—was tied to about 18 more physically and mentally unhealthy days each month per 1000 people after accounting for sociodemographic factors. Increased medical debt was also linked with more premature deaths and more deaths from any cause, including cancer, heart disease, and suicide.”

Medical Debt in US Linked with Worse Health, More Deaths | Cardiology | JAMA | JAMA Network

Re: retirement affordability: As a society, we focus a tremendous amount of energy on helping people live longer lives. But not even a fraction of that effort is spent helping people afford those extra years…

It’s not just that more people are retiring in America; it’s also that their retirements are increasing in length. Today, if you’re married and both you and your spouse are over the age of 65, there’s a 50/50 chance at least one of you will be receiving a Social Security check until you’re 90…

All this is putting the U.S. retirement system under immense strain. The Social Security Administration itself says that by 2034, it won’t be able to pay people their full benefits…

When the U.S. Census Bureau released its regular survey of consumer finances in 2022, nearly half of Americans aged 55 to 65 reported not having a single dollar saved in personal retirement accounts. Nothing in a pension. Zero in an IRA or 401(k).”

Larry Fink’s 2024 Annual Chairman’s Letter to Investors | BlackRock

Re: Hospital finances: “Robust hospital margins in February demonstrate continued recovery from the pandemic years, but challenges are on the horizon. The aftermath of the Change Healthcare cyberattacks and continued competition from industry disrupters may test financial performance in coming months, as disrupters capture more profitable, lower-acuity, and lower-capital-intense services from hospitals.”

Erik Swanson, senior vice president of Data and Analytics, Kaufman Hall National Hospital Flash Report: March 2024 | Kaufman Hall

Re: private equity in opioid treatment: “Private equity firms have acquired stakes in nearly one-third of all methadone clinics in recent years, gaining outsize control of the U.S. addiction treatment industry even as the country’s opioid epidemic has developed into a full-fledged public health crisis.

A small handful of little-known financial institutions now has an ownership stake in 562 methadone clinics across the country, according to a first-of-its-kind STAT analysis. And in the past two years, large clinic chains backed by private equity firms have launched a lobbying blitz aimed at preserving their exclusive right to dispense methadone, a powerful medication that cuts the risk of opioid overdose death by more than 50%…

Private equity firms typically invest in businesses with the intent of streamlining them to increase profit margins, then sometimes selling the businesses again just years later, once their value has increased. One recent review of published studies on the effect of private equity investment in health care concluded that private equity ownership generally led to higher costs for patients, payers, and government programs.”

Private equity moves into the methadone clinic monopoly – STAT (

Re: Big 8 Consultancies: “Not long ago the consulting industry looked indestructible. Fees rocketed during the covid-19 pandemic as clients sped up efforts to digitize their businesses, diversify their supply chains and respond to growing calls to bolster their environmental, social and governance (esg) credentials. The consulting revenues of the industry’s most important firms—including the triumvirate of strategy advisers (Bain, bcg and McKinsey), the “big four” accounting giants (Deloitte, ey, kpmg and pwc) and Accenture (also the world’s largest outsourcer)—grew by 20% in 2021 and then 13% in 2022.

Since then, however, growth has been soggy for the industry’s “great eight”, slowing to around 5% in 2023, according to estimates by Kennedy Research Reports, an industry-watcher, and calculations by The Economist, based on company filings. Clients grappling with inflation and economic uncertainty have cut back on splashy consulting projects. A dearth of mergers and acquisitions has led to a slump in demand for support with due diligence and company integrations…

The quicker corporate clients become comfortable with chatbots, the faster they may simply go directly to their makers in Silicon Valley. If that happens, the great eight’s short-term gains from ai could lead them towards irrelevance. That is something for all the strategy brains to stew on. “

Have McKinsey and its consulting rivals got too big? (


Re: Magnificent 7 or Fab 4 in the 1Q 2024 S&P 500: “The Magnificent Seven trade is beginning to fizzle—and yet, the stock market is still heading higher. The S&P 500 climbed 10% in the first quarter, its best start to a year since 2019, even though two of its biggest constituents suffered double-digit declines.

Apple AAPL -1.06%decrease; red down pointing triangle shares fell 11% in the first three months of the year, while  Tesla TSLA -2.25%decrease; red down pointing triangle dropped almost 30%.  Alphabet shares sputtered for much of the period before making a run in the past three weeks and ending up 8%. The other four big tech stocks in the group known as the Magnificent Seven—Nvidia, Meta Platforms, Microsoft,—continued their meteoric run and outpaced the broader market. Some market strategists have dubbed them the new Fab Four.”

The Stock Market’s Magnificent Seven Is Now the Fab Four  – WSJ


Care Management

Addiction management and methadone access: At a leading Swiss addiction clinic in Zurich, all patients who need addiction care gain instant access to weeks’ worth of medication. They are not required to participate in counseling, or subjected to drug tests, or punished if they relapse and use any kind of illicit substances. American methadone clinics would say that approach leads to disaster. European experts disagree, saying that’s the continent’s key to success. They have a point in Switzerland, where the opioid death rate is now roughly one-twentieth the U.S. rate.

In a dozen other wealthy, developed nations where methadone is far more accessible than in the U.S., public health outcomes are far better, with lower rates of opioid overdose, infectious disease transmission, and death.

American doctors, lawmakers, and public health officials are beginning to speak out for liberalizing access to methadone as the best tool available to address the crisis. Those who take it are 59% less likely to die of opioid overdose. But American methadone clinics counter that argument, saying that the current restrictions are necessary safety precautions.

STAT investigates the opposition to buprenorphine, methadone use (



Kaufman Hall February Flash Report: “The National Hospital Flash Report uses both actual and budget data over the last three years, sampled from more than 1,300 hospitals on a recurring monthly basis from Syntellis Performance Solutions.” Key takeaways:

  • Margins this month were at 3.96%, continuing a strong start to 2024. However, data this month do not reflect the full impact of the Change Healthcare outage, which began February 21st.
  • Gross revenue continues to rise at a faster rate than net revenue, highlighting payer mix changes. Bad debt and charity care have also risen over the last few years.
  • Revenue growth is primarily being driven from the outpatient setting. There continues to be a decline in inpatient revenue and increase in outpatient revenue.

National Hospital Flash Report: March 2024 | Kaufman Hall

Study: hospital performance after HEA: Researchers examined potential changes in hospital performance after Hospital Equity Adjustments (HEA). Findings:

Of 2676 hospitals participating in the HVBP program in fiscal year 2021, 1470 (54.9%) received bonuses and 1206 (45.1%) received penalties. After HEA, 102 hospitals (6.9%) were reclassified from bonus to penalty status, whereas 119 (9.9%) were reclassified from penalty to bonus status. At the hospital level, mean (SD) HVBP payment adjustments decreased by $4534 ($90 033) after HEA, ranging from a maximum reduction of $1,014, 276 to a maximum increase of $1,523,765. At the aggregate level, net-positive changes in payment adjustments were largest among safety net hospitals ($28 971 708) and those caring for a higher proportion of Black patients ($15 468 445).

Health Equity Adjustment and Hospital Performance in the Medicare Value-Based Purchasing Program | Health Disparities | JAMA | JAMA Network


Impact of ACA on insurer stock prices: Since the ACA was enacted in 2010, the collective stock prices of Centene, Cigna, Elevance Health, Humana, Molina Healthcare and UnitedHealth Group rose 1,032% and outpaced S&P 500 ETF, according to the Paragon Health Institute. The institute showed that financial gains mirrored other industries much more closely before the law was passed…

“The cost to taxpayers has been 36,798 per additional private insurance enrollee and 20,739 per additional non-group enrollee, which is more than triple CBO’s original projections of 10,538 and 6,850, respectively…

All told, nearly 3 in 4 Americans polled are dissatisfied with the current healthcare system, data from the Harris Poll show.”

Insurers are booming as ACA debate rages. What’s next? (

Study: Prior authorization in Medicare Advantage Plans: Researchers examined data for 2008-2019 to assess the annual share of MA enrollees in plans requiring at least some prior authorization and plotted trends over time. Finding:

“From 2009 to 2019, the share of MA enrollees in plans requiring prior authorization for any service remained stable. By service category, the share of MA enrollees exposed to prior authorization ranged from 30.7% (physician specialist services) to 72.2% (durable medical equipment) in 2019, with most service categories requiring prior authorization more often over time. Several area-level demographic and provider market characteristics were associated with prior authorization requirements, but these associations weakened over time. The use of prior authorization varied widely across plans.”

The Extent and Growth of Prior Authorization in Medicare Advantage (

Brookings: No Surprises Act dispute resolution results: Researchers specifically focused on emergency care, imaging and neonatal and pediatric critical care:

“Looking across three categories of services, we find that the median IDR decision is at least 3.7 times what Medicare would pay. For the two categories of services where we have estimates of historical mean in-network commercial prices relative to Medicare, the median decision is at least 50% higher than these past prices. Decisions appear closer to the amounts insurers historically paid for out-of-network care. These outcomes reflect the fact that providers are submitting relatively high offers and that IDR entities are selecting the provider’s offer more than three-quarters of the time. And they contrast with Congressional Budget Office (CBO) projections that outcomes would hew close to prior in-network rates.”

A first look at outcomes under the No Surprises Act arbitration process | Brookings

Study: Marketing to the uninsured: Researchers analyzed the effects of informational emails on plan switching and health care utilization among households enrolled in Affordable Care Act marketplace coverage during the 2021 enrollment period.

Findings: In this randomized clinical trial that included 42, 470 California households enrolled in non–silver-tier plans and eligible for plans that cover 94% of medical costs, informational emails led to a statistically significant 75% increase in switching to silver-tier plans.

Health Plan Switching and Health Care Utilization: A Randomized Clinical Trial | Health Policy | JAMA Health Forum | JAMA Network

Weight loss drug coverage by insurers: Last week, CVS Health,   Elevance Health,  and Kaiser Permanente announced they would cover  Novo Nordisk’s  Wegovy for the use of reducing the risk of heart attacks and strokes in people who have cardiovascular disease, meet body-weight criteria and are covered by a Medicare drug-benefit plan…

For Novo and Eli Lilly, which makes the competing anti-obesity drug Zepbound, expanding Medicare coverage could mean billions of dollars in additional sales over time. In the near term, supply shortages could limit sales growth.

The insurers’ decisions arose from new guidance issued last week by the Centers for Medicare and Medicaid Services, which administers Medicare for millions of people 65 and older, and younger people with certain disabilities and diseases.

Wegovy: First Medicare Health Plans to Start Paying for Weight-Loss Drug – WSJ



First Quarter S&P Results: In 1Q 2024, the S&P 500 notched its best quarter in 5 years—up 10.2% led by gains in Nvidia (up 82.5% in Q1) and expectations of rate cuts by the Federal Reserve. The “Magnificent 7” — Apple, Amazon, Alphabet, Microsoft, Meta, Nvidia and Tesla — drove about 40% of these gains YTD. Notably, Apple (down 7.6%) and Tesla (down 29.2%) have stumbled on weakening demand worries for their core products.

S&P 500 ends Q1 on a high note as rally keeps going (

Pitchbook: 4Q 2023 HCIT investments: Healthcare IT companies raised $811.0 million cumulatively in VC funding across 50 deals in Q4 2023, representing a 12.7% decline in deal value and a 21.9% decrease in deal count QoQ. Annual VC deal value for healthcare IT decreased by 29.2% YoY. By far, the quarter’s largest VC deal was the Oak HC/FT-led $315.0 million fundraise by VBC enabler Main Street Health. Led by former Centers for Medicare & Medicaid Services (CMS) Deputy Administrator Brad Smith, Main Street focuses exclusively on enabling rural healthcare providers to transition to value-based MA contracts.

PE investors announced or closed 24 healthcare IT software deals in Q4 2023, down 22.6% from Q3 but roughly flat with the average pace of deal activity throughout 2023. PE healthcare IT deal activity decreased by 24.0% YoY in 2023. Other than the close of Thoma Bravo’s take-private of NextGen Healthcare, there were no large PE deals or exits in Q4 2023, and the quarter was dominated by small to medium-size platform combinations such as patient engagement content vendor pCare’s sale to Uniguest and third-party administrator CHCS Services’ acquisition of home care claims platform AssuriCare. However, as described earlier in this report, several larger exits are either in progress or were announced in Q1 2024, suggesting that activity may pick back up in 2024

Q4_2023_Healthcare_IT_Report_Preview.pdf (

Private equity in healthcare staffing: From 2020 through 2023, private equity firms acquired 116 healthcare staffing companies and were involved in more than 60% of all clinical staffing transactions…

Many major healthcare staffing companies are private equity-owned, including CHG Healthcare, Medical Solutions, SCP Health, TeamHealth and Fastaff Travel Nursing.

Last year, private equity investors were involved in 19 clinical staffing deals, according to Pitchbook, a private equity and venture capital database. The majority of the deals were in the physician and post-acute staffing spaces.

How private equity-backed staffing companies impact providers | Modern Healthcare



Study: Payments to physicians by vendors: Researchers examined data from the Open Payments platform from 2013 to 2022 for payments (cash and noncash equivalents) for consulting services, non-consulting services (such as fees for serving as a speaker or faculty at a venue), food and beverages, travels and lodging, entertainment, education, gifts, grants, charitable contributions, and honoraria made to physicians (allopathic and osteopathic). Findings:

From 2013 to 2022, payments with a total value of $12.13 billion were made by industry to 57.1% of physicians (826, 313 of 1,445 944 eligible physicians) or $48 per physician.

Orthopedic surgeons received the greatest sum of payments at $1.36 billion, followed by neurologists and psychiatrists at $1.32 billion, and then cardiologists at $1.29 billion.

The 3 drugs associated with the most payments were Xarelto ($176.34 million), Eliquis ($102.62 million), and Humira ($100.17 million). The 3 medical devices associated with the most payments were the da Vinci Surgical System ($307.52 million), Mako SmartRobotics ($50.13 million), and CoreValve Evolut ($44.79 million)

Industry Payments to US Physicians by Specialty and Product Type | Surgery | JAMA | JAMA Network


Study: primary care physician perspectives on interoperability: Findings from survey of 2088 physicians:

  • 70% indicated being at least somewhat satisfied
  • 11% were very satisfied with their ability to electronically access all 10 types of information from outside organizations included on the questionnaire, and a mean of 70% were at least somewhat satisfied.
  • 23% of family medicine physicians reported information from outside organizations was very easy to use, and an additional 65% reported that information was somewhat easy to use. Only 8% reported that information from different electronic health record (EHR) developers’ products was very easy to use compared with 38% who reported information from the same EHR developer’s product was very easy to use.

Primary Care Physicians’ Satisfaction with Interoperable Health Information Technology | Electronic Health Records | JAMA Network Open | JAMA Network



Gallup: March 2024: “Gallup asks Americans to rate their concern about a variety of national issues each March as part of its Environment poll. This year’s survey, conducted March 1-20, asked respondents about 14 different issues:

The 55% of Americans who worry “a great deal” about inflation is just slightly above the percentages concerned about five other domestic issues that are troubling to majorities of Americans. These are crime and violence (53%), hunger and homelessness (52%), the economy (52%), the availability and affordability of healthcare (51%), and federal spending and the budget deficit (51%).

Healthcare was 40% among Republican voters, 53% to independent voters, and 57% to Democratic voters.

Inflation, Immigration Rank Among Top U.S. Issue Concerns (

PWC: Trust in organizations: “Business executives continue to overestimate how much they are trusted by employees and consumers. And they’re more off the mark today than they were in the last two years. Consider that 90% of business executives think customers highly trust their companies while only 30% of consumers actually do. That gap of 60%is greater than the 57% we saw in both 2023 and 2022. Employees are more likely than consumers to trust businesses, but there’s still a widening gap: 86% of business executives think employee trust is high, compared to 67% of employees who say they highly trust their employer. This employee trust gap of 18% is higher than in the past.

One reason companies may be overly optimistic about trust levels is that they don’t have internal structures in place to consistently identify where the trust expectation gap exists.”

Trust in US Business Survey: PwC


Prescription Drugs

46 Brooklyn: February drug pricing report: There was a total of 38 brand-name medications that saw wholesale acquisition cost (WAC) price increases in February and 1 list price decrease.

List price changes ranged from -10% to 486% and impacted $110 million in prior year gross Medicaid expenditures (PYME). As a reminder, January saw brand changes impacting over $30 billion in PYME, so this is a very, very small month in terms of impact to gross Medicaid expenditures.

“In comparison to prior Februarys, this month is about average. February 2023 saw 54 net brand price increases (combined increases and decreases) whereas February 2022 saw 43. However, that’s just the number of price changes. The impact of this February is likely smaller as measured by its impact to expenditures. Both 2023 and 2022 February price increases impacted roughly $300 million in Medicaid drug spend whereas this year is roughly a third of that. This is likely a function of both the mix of drugs taking a price increase but also the increasing use of generic drugs within the Medicaid program over time… February price changes push the median price increase from 4.7% up to 4.9%. “

Valentines from the drug channel? — 46brooklyn Research

Medication adherence: There’s a price to pay for neglecting to take prescription drugs. An astonishing 40 to 50 percent of people who are prescribed medicines for chronic conditions like high blood pressure or diabetes fail to take them — and incur at least $100 billion in preventable medical costs annually as a result. This lack of compliance is estimated to lead to at least 100,000 preventable deaths each year.

Even a heart attack may not be enough to scare people into taking the current arsenal of cardiac drugs, shown to prevent heart disease deaths. Some studies show that just half of people who had heart attacks were still taking drugs to protect their heart two years later

And while cost plays a role, at least one study found that even when drugs are free, adherence can be abysmal.

Patients Hate ‘Forever’ Drugs. Are Ozempic and Wegovy Different? – The New York Times (

Drug Pricing: Two contrasting reports:

Insulin, SGLT2Is and GLP1As: Researchers analyzed projected prices of insulins, sodium-glucose cotransporter 2 inhibitors (SGLT2Is), and glucagonlike peptide 1 agonists (GLP1As) be if they were closer to the cost of their production. Findings:

“In this economic evaluation of manufacturing costs, estimated cost-based prices per month were US $1.30 to $3.45 for SGLT2Is (except canagliflozin), and $0.75 to $72.49 for GLP1As, substantially lower than current market prices in nearly all comparisons. Twice-daily mixed human insulin NPH could cost $61 per year, while basal-bolus treatment with insulin glargine and as part could cost $111 per year, with reusable pen formulations having the lowest estimated prices.”

Estimated Sustainable Cost-Based Prices for Diabetes Medicines | Diabetes and Endocrinology | JAMA Network Open | JAMA Network

Lenmeldy: “The staff of the Institute for Clinical and Economic Review, or ICER, are known as the nerds of the drug industry: bespectacled killjoys who emerge a few times a year to scold drugmakers for pricing their latest cancer or MS advance far beyond reason.

But last year, its staff sat down and concluded a forthcoming treatment was worth up to $3.9 million — more than any medicine in history, more than a 45-year supply of Humira, the autoimmune drug often held up as an emblem of America’s runaway drug spending.

It was a testament to the power of a new class of gene therapies to deliver something pharma so rarely does: Genuine cures. The treatment, approved last week as Lenmeldy, may allow some babies born with an ultra-rare neurodegenerative disease called metachromatic leukodystrophy, or MLD, to grow up and live essentially normal lives.”

ICER Comments on the FDA Approval of Zolgensma for the Treatment of Spinal Muscular Atrophy – ICER

Study: OOP expenses for biologics: Researchers analyzed insured patient use of biologic drugs, is competition by biosimilars associated with lower out-of-pocket (OOP) spending:

“In this cohort study of 190 364 outpatients with 1.7 million claims for 7 biologics between 2009 and 2022, annual OOP spending did not decrease after the start of biosimilar competition, and OOP costs were similar for biosimilars and their reference biologics.

Findings of this study suggest that the introduction of biosimilar competition did not systematically lower patient OOP spending on biologics, highlighting the need for targeted policy interventions to ensure that savings from biosimilar competition improves affordability for patients.”

Patient Out-of-Pocket Costs for Biologic Drugs After Biosimilar Competition | Health Policy | JAMA Health Forum | JAMA Network

Public Health

Study: School shootings incidence rate: Researchers analyzed data from 2 public databases involving 1453 school shootings and mass school shootings between 1997-1998 and 2021-2022. They defined school shootings as anytime someone pulled out a gun or fired one; mass school shootings are those in which at least 3 people were killed. Findings:

Almost 800 school shootings occurred between 2017 and 2022, which is 135 more shootings than took place during the previous 15 years combined, the researchers found. And although the number of mass shootings per year has remained stable during the 25-year period, they have become more dangerous since 2012. The largest number of people—57—died or were injured during the 2017-2018 school year, with the second-largest number dying or being injured during 2021-2022.

School Shootings in US Reach Highest Recorded Levels | Pediatrics | JAMA | JAMA Network


Regulator Reports

White House re: Junk Insurance Plans “Today, the Biden-Harris Administration is taking a major step to crack down on junk health insurance for American families and consumers and deliver better health. As the President has said, people hate being played for suckers and the current practice of offering low-quality insurance that people pay into, but then provides no coverage when people need it, is a bait and switch. That’s why the Biden-Harris Administration is issuing a final rule that protects consumers from junk health insurance and makes sure Americans aren’t scammed into low-quality coverage that leaves consumers on the hook for thousands of dollars in medical bills or denies life-saving care right before treatment. The President is committed to building on the promise of the Affordable Care Act and its critical consumer protections that ensure meaningful coverage for people’s health care needs.

“Short-term” plans must be truly short-term.  Under the new rules, new plans that claim to be “short-term” health insurance are now limited to just 3 months, with renewal for a maximum of 4 months total, if extended – instead of up to 3 years as the previous administration allowed, causing junk health insurance plans to proliferate and confuse consumers that they were real, comprehensive coverage when they in fact provided little to no coverage.

Plans have to clearly disclose limitsInsurance plans will now be required to provide consumers with a clear disclaimer that explains the limits of what services they cover and how much they cover. “

FACT SHEET: President Biden Announces New Landmark Rule to Protect Americans from Junk Health Insurance | The White House

HHS OIG re mental health parity in Medicaid: Per the OIG audit of eight states (AZ, IL, KS, MS, NJ, NY, SC TX), none provided public documentation of compliance by the deadline or ensured all services adhered to parity requirements for mental health and substance use services. In 2021, nearly 58 million adults experienced a form of mental illness, and 46.3 million people 12 and older had a substance use disorder, the report says.

CMS Did Not Ensure That Selected States Complied with Medicaid Managed Care Mental Health and Substance Use Disorder Parity Requirements, A-02-22-01016 (

FDA: On March 1, 2024, the U.S. Food and Drug Administration (FDA) announced in a letter of enforcement discretion that it does not object to the use of certain qualified health claims regarding the consumption of yogurt and reduced risk of type 2 diabetes, provided that the qualified health claims are worded so as not to mislead consumers, and that other factors for the use of the claim are met.

FDA Response to Petition for a Qualified Health Claim for Yogurt and Reduced Risk of Type 2 Diabetes Mellitus (Docket No. FDA-2019-P-1594) – March 1, 2024

CFPB: In its most ambitious move to date, the Consumer Financial Protection Bureau is developing rules to bar medical debt from consumer credit reports, a sweeping change that could make it easier for Americans burdened by medical debt to rent a home, buy a car, even get a job. Those rules are expected to be unveiled later this year…But CFPB’s defenders say its move to address medical debt simply reflects the scale of a crisis that now touches some 100 million Americans and that a divided Congress seems unlikely to address soon. The push to remove medical bills from consumer credit reports culminates two years of intensive work by the CFPB on the medical debt issue…

With Medical Debt Burdening Millions, a Financial Regulator Steps in to Help – KFF Health News

Retail Health

Rite Aid, which filed for bankruptcy protection in October, reached preliminary agreements to transfer ownership of the bankrupt drugstore operator to its senior bondholders while settling certain lawsuits over its alleged role in overprescribing opioids, according to court papers filed last Thursday.

Under the plan, Rite Aid’s senior bondholders would swap their claims for 90% of the stock in the reorganized company, while senior lenders would be paid in full in either cash or in new loans.

The deal, if approved by bankruptcy court, will cut more than $2 billion of debt and keep much of the Philadelphia-based company’s network of drugstores intact.

Rite Aid earlier this month reached an agreement in principle with the Justice Department to resolve the government agency’s claims over alleged violations of the False Claims Act and Controlled Substances Act for knowingly filling unlawful prescriptions for controlled substances.

Rite Aid Strikes Deal to Hand Control to Creditors, Settle Opioid Claims – WSJ