The Players & Money Flow
What are patients referred to as in our slides?
Consumers (also members, beneficiaries, enrollees)
What are payers referred to as?
Third-party payers (insurers)
Number of phases in the FDA approval process
4 phases
Average time for drug pipeline from preclinical to official launch
What is 10+ years?
Doctors, hospitals, and clinics that deliver care to patients are collectively called what?
A provider
The type of insurance payment that you pay monthly
What is a premium?
The two types of items that go through FDA approval
Drugs and med devices
Who are the main buyers of most medical devices?
Hospitals and providers
Hospitals and doctors rarely bill the patient for the full cost. Who do they send the bill to instead?
The payer (insurer)
3 main categories of insurance
What is publicly funded, private, and employer sponsored insurance?
Purpose of Phase 4 in FDA approval
Safety monitoring after launch
True or False: for a hip implant, the payer pays the device company directly.
False. The hospital buys the device, and the payer pays the hospital.
Which player acts as the financial middleman, negotiating bulk-rate discounts with provider networks and deciding what is covered?
The payers
The type of insurance payment that you must pay before you are covered for expenses
What is a Deductible?
Number of risk-based classes for med devices
What is 3?
What are the three clinical trial phases before FDA review, in order? (need brief explanations of each)
Phase 1 (safety), Phase 2 (early efficacy), Phase 3 (large pivotal trials)
Payers negotiate bulk discounts with their network of providers. What is the discounted price a provider agrees to accept called (hint: it’s the “negotiated” or “contracted” ___)?
Negotiated (contracted) rate
The type of insurance payment that is the amount of money a patient pays for each healthcare service
What is a Copayment?
These are drugs marketed under a proprietary, trademark-protected name.
Brand-name Drugs
Purpose of patent for big pharma
What is market exclusivity?