Study: Growth of Antibiotic-Resistant Infections Could Have Massive Human, Financial Costs

Share on Facebook
Share on Twitter
Share on
LinkedIn
+

Dysfunctional market, perverse incentives caused by Medicare reimbursement rates contribute to problem

BOSTON – The world was blindsided by COVID-19, but a new Pioneer Institute study finds that even as we continue to wrestle with the pandemic, another threat looms that scientists have long known about but the nation has thus far failed to address: the growth of antibiotic-resistant infections.

“Market dysfunction and perverse Medicare reimbursement rates have led to a growth in infections that resist antibiotics,” said Gunnar Esiason, author of “Antimicrobial Resistance: Learning from the current global health crisis to prevent another one.”  If we don’t solve this problem, the human and economic costs are likely to be astronomical.”

In the U.S., around two million people per year contract infections that are resistant to antibiotics and as many as 23,000 of them die.  These drug-resistant infections account for $20 billion in health care costs.

If unchecked, it’s forecast that the problem could claim 10 million lives per year worldwide and be responsible for the loss of $100 trillion in economic output by 2050.

Antibiotic resistance is driven by years of overuse and misuse of antibiotics.  Medicare is the nation’s largest payer, and its recipients account for the majority of resistant infections.  Because hospitals receive the same reimbursement whether they use an older generic drug or a new drug that is likely to be more expensive, there is a financial incentive to prescribe the older drugs, even if those drugs may not be as effective because patients have built up resistance to them.

The continuing use of older drugs exacerbates the antibiotic resistance problem.  It can also result in higher health care costs because additional treatments are required to treat the infection, or cause hospitals to use unnecessarily strong antibiotics to treat it effectively.

Hospitals favoring older generic drugs even if they are less effective makes it harder for new drugs to recoup development costs, which can be up to $2.6 billion.  As a result, investment is down and the number of new antibiotics approved by the FDA has fallen in recent years.  In addition, companies working on new antibiotics are more likely to be small firms or start-ups that are less financially stable.

With its large concentration of life science companies, Massachusetts could be particularly hard hit if investment in new antibiotics continues to lag.

One effort to address the antibiotic-resistant infection problem is the DISARM Act, which was introduced in Congress last year.  The legislation would increase Medicare antibiotic reimbursements and eliminate the incentive to prescribe less expensive drugs that are often less effective by allowing for the reimbursement of all antibiotics, regardless of cost.  Backers argue that the bill would slow the growth of resistant infections by ending the overuse of older drugs that have become less effective, and that newer, more effective antibiotics could reduce long-term costs.

Esiason also recommends mounting a broad awareness campaign that would tie this impending public health and economic threat to our current battle against COVID-19.

About the Author

Gunnar Esiason is a cystic fibrosis and rare disease patient leader, who is passionate about early stage drug development, patient empowerment and health policy. He is a second-year M.B.A. student at the Tuck School of Business at Dartmouth and is also working towards a Master of Public Health degree at the Dartmouth Institute for Health Policy and Clinical Practice. At Tuck, Gunnar serves as a Tuck Center for Health Care MBA Fellow, a health care club co-chair and a club hockey captain. Prior to Tuck, Gunnar received a BA form Boston College in 2013, worked on an enteral feeding product at a medical nutrition company, was appointed to the board of directors at the Boomer Esiason Foundation, and was the head coach of his high school alma mater’s varsity hockey team. Gunnar maintains the roles of patient advocate and director of patient outreach at the Boom­er Esiason Foundation.

He has consulted on clinical trial development, a real-world evidence population health study, and a cystic fibrosis-specific mental health and wellness screening tool. In 2019, Gunnar delivered the pre-commencement address at the St. Louis Uni­versity School of Medicine commencement exercises. He has also been featured as a keynote speaker at more than two-doz­en top medical centers, biotech conferences, and health indus­try events across the United States. His health policy opinions have been featured in Newsweek, The New York Daily News, The Hill, US News & World Report, and Morning Consult.

About Pioneer

Mission: Pioneer Institute develops and communicates dynamic ideas that advance prosperity and a vibrant civic life in Massachu­setts and beyond.

Vision: Success for Pioneer is when the citizens of our state and nation prosper and our society thrives because we enjoy world-class options in education, healthcare, transportation and economic opportunity, and when our government is limited, accountable and transparent.

Values: Pioneer believes that America is at its best when our citizenry is well-educated, committed to liberty, personal responsibili­ty, and free enterprise, and both willing and able to test their beliefs based on facts and the free exchange of ideas.

Get Updates On Our Life Sciences Work!

Related Posts

Why did some nursing homes experience more COVID-19 deaths and infections than others?

/
The COVID-19 pandemic has caused great loss for Massachusetts…

Why does a gender-gap persist in vaccination rates?

/
Men are more likely to die of COVID-19 than women: 13 men die…

Alzheimer Breakthrough Disillusionment: Confusion on FDA’s Approval of Expensive and Possibly Ineffective Drug

Hubwonk host Joe Selvaggi talks with precision medicine expert Hannah Mamuszka and Pioneer Institute's Bill Smith about the promises and pitfalls of the newly approved Alzheimer’s drug Aduhelm, and the challenges presented when new, expensive drugs of dubious benefit are introduced to the nation’s formulary.

Comparing Covid-19 Vaccination and New Infection Rates in Suffolk County: Is Vaccination Working?

/
Massachusetts ranks fourth nationally for the highest percent…

Dr. Babak Movassaghi on Winning in Football & Healthcare Innovation

/
This week on JobMakers, Host Denzil Mohammed talks with Dr. Babak Movassaghi, founder of InfiniteMD (acquired last summer by ConsumerMedical), which connects patients with top U.S. medical professionals through second-opinion video consultations, guiding patients to better care. When the world shut down due to COVID-19, Dr. Movassaghi's company was already prepared to serve patients via telehealth. In this episode, they discuss his fascinating pivot from physics and professional football in Germany, to healthcare and innovation here in the U.S., an extension of his ability to navigate multiple identities as an Iranian-German living the American Dream.

Valuing Life-Saving Drugs: What is the Price of Life and Who Decides?

Hubwonk host Joe Selvaggi talks with Pioneer Institute visiting fellow Dr. Bill Smith about Quality Adjusted Life Years (QALY) standards, and the ways in which so-called objective cost-containing strategies use expert opinion to determine the value of a life and thereby disadvantage the elderly, disabled, and those with less common vulnerabilities to disease.

Study: Massachusetts Should Retain Additional Healthcare System Flexibility Granted During Pandemic

Massachusetts’ emergency declaration for COVID-19 ends on June 15, and with it some enhanced flexibility that has been allowed in the healthcare system.  Some of the added flexibility highlighted barriers that make the system more expensive, harder to access and less patient-centered, and the Commonwealth should consider permanently removing these barriers, according to a new study published by Pioneer Institute.

Origin of COVID-19: As Animal Source Evidence Eludes Scientists, Lab Leak Hypothesis Gains Purchase

This week on Hubwonk, host Joe Selvaggi talks with author and former New York Times science journalist Nicholas Wade about his recent article in the Bulletin of the Atomic Scientists on the possible origins of the SARS2 virus that caused the COVID-19 pandemic. In their conversation, they consider the possibility that, absent finding evidence of a natural jump from animals, the SAR2 virus may have come from a lab.

Study Calls for Better Reporting on Impact of COVID-19 in Eldercare Facilities

Over time, the Massachusetts Executive Office of Health and Human Services and Department of Public Health (DPH) have improved reporting about cases and deaths from COVID-19 in state-regulated eldercare facilities, but flaws and omissions remain and should be corrected, according to a new study published by Pioneer Institute.

Amar Sawhney on Sikhs, STEM & COVID

On this week's episode of JobMakers, host Denzil Mohammed talks to Dr. Amar Sawhney about his journey from India to Boston, and how he is using his chemical engineering background to save lives through remarkable local therapy innovations. To date, he has founded eight companies accounting for 4,000 jobs and more than $2 billion in revenue.

Massachusetts Should Disclose More Information about Its Recent Reduction in the Official Count of Long-term Care Deaths

The public -- particularly in Massachusetts, where COVID-19’s toll on elders has been so great -- has a right to know how many deaths occurred in state-regulated eldercare facilities, and how that compares to the total number of deaths. But the state's new counting standard clouds this information, and should be corrected or at least disclosed.

Preparing For Disaster: Health Readiness Expert’s Performance Review

Hubwonk Host Joe Selvaggi talks with Emergency Preparedness expert Dr. Paul Biddinger about how experts plan for disasters, and what went right and wrong in this pandemic.

COVID-19 Vaccine Tracker

Pioneer is proud to present a new vaccine tracker, the newest tool in our COVID-19 tracking project. Pioneer distilled the vaccination data down to those who are either fully vaccinated or partially vaccinated, by all the demographic categories published by the DPH. Use the new tool below to compare rates among groups, by municipality and by county. We will update the data every week.

Doctor Heal Thyself: Insider’s Prescription For Healthcare Reform

Host Joe Selvaggi talks with surgeon and New York Times bestselling author Dr. Marty Makary about the healthcare reform themes in The Price We Pay, the 2020 Business Book of the Year.  The discussion covers the value of price transparency, provider accountability, and performance information to drive better medical outcomes and improve doctor and patient satisfaction.

The QALY and Cancer Treatments: An Ill-Advised Match

This report examines the alarming methodological and contextual shortcomings of the Quality Adjusted Life Years (QALY)-based methodology in evaluating new cancer therapies. It reveals five specific problems with ICER’s evaluation of cancer treatments and demonstrates the urgent need to prohibit the use of the QALY amid trends in rapid cancer innovations and personalized medicine.

New Analysis: ICER Framework Ignores Patient Preferences, Innovation & Societal Benefits in Evaluating Cost-Effectiveness of New Cancer Treatments

Pioneer Institute today released a new analysis, The QALY and Cancer Treatments: An Ill-Advised Match, that examines the alarming methodological and contextual shortcomings of the Quality Adjusted Life Years (QALY)-based methodology in evaluating new cancer therapies. The Pioneer Institute analysis reveals five specific problems with ICER’s evaluation of cancer treatments and demonstrates the urgent need to prohibit the use of the QALY amid trends in rapid cancer innovations and personalized medicine.

Digesting Digital Medicine: Healthcare Benefits When Smart Pills Track When Taken

/
Host Joe Selvaggi and Pioneer Institute’s Bill Smith talk with Valerie Sullivan, President and CEO of EtectRX about the health care costs of improperly taking prescriptions and the promise of smart pills to signal and track medicines when ingested.

Patient-centered Model Outshines Insurance-centered Healthcare during Pandemic

/
Joe Selvaggi talks with Pioneer Institute Senior Fellow Josh Archambault about his newest research paper entitled, "Direct Health Care Agreements: A New Option For Patient-Centered Care That Costs Less and Reduces Provider Burn-out" and how this emerging service model provided its patients with comprehensive health service throughout the COVID-19 pandemic.