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Mira hopes to take AR mainstream with $99 phone-powered headset
 Cofounders Matt Stern and Ben Taft showed me the device recently in San Francisco. I played around with a silly outer-space demo that had me do things like turn in circles to spot and shoot evil doughnut holes floating in an imaginary galaxy, and land a tiny rocket ship on a target.

Mira is using paper targets to affix some of its virtual objects to surfaces, and by using the iPhone’s front-facing camera, you can identify these targets and pull up associated 3-D virtual objects. So if you had an app projecting a three-dimensional chess board onto a marker on a table, for instance, you could walk around it or have multiple people view it from different angles at the same time.

The Prism headset looked extremely goofy, and I had some trouble navigating with the remote control. But the visuals looked pretty good even as I turned my head or, in the case of one virtual object that clung to the table, walked around them. And since it allows multiplayer interactions in AR via Bluetooth, it was neat to be able to play a Pac Man–like game against Taft. (Meanwhile, Stern was able to watch what we were doing from the display on his iPhone.)

Yet the world of AR and VR is still in the very early stages, so Mira is likely to struggle to fit in. Smartphone-reliant headsets like Gear VR and Google’s Daydream View VR are more popular than devices that need to be plugged in to a computer. But a total of only 2.3 million headsets—the vast majority of them for virtual reality—shipped out in the first three months of the year, according to tech market researcher IDC.

A big problem for even the biggest manufacturers is that there isn’t a ton of content—especially top-quality content—for these smartphone-based headsets, says Brian Blau, an analyst with the market research firm Gartner.

“I think that they’re going to have a tough road,” he says.

Output: San Francisco start-up Mira has raised $1.5m of funding from Sequoia Capital to commercialise its low-cost AR headset. Called Prism, the headset works much like an AR version of the Samsung Gear or Google Daydream systems. The user puts their phone into a slot and the images are projected from the screen, not via lenses directly onto the eyes (as in VR) but onto a transparent perspex visor, making virtual objects appear to exist in the real world.


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Pirelli to launch all-black calendar for 2018
 Stay ahead of the trend in fashion and beyond with our free weekly Lifestyle Edit newsletter Stay ahead of the trend in fashion and beyond with our free weekly Lifestyle Edit newsletter Please enter a valid email address Please enter a valid email address SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy notice Thanks for signing up to the

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Tim Walker and incoming British Vogue editor Edward Enninful have joined forces to create the 2018 Pirelli Calendar, featuring an all-black cast.

In homage of John Tenniel’s original Alice in Wonderland illustrations, the calendar will recreate imagery inspired by beloved characters including the Queen of Hearts, the caterpillar and Tweedledee.

Naomi Campbell takes centre stage in the Royal Beheader role with Sean “Diddy” Combs as her trusty sidekick.

Thando Hopa as the Princess of Hearts and Whoopi Goldberg as the Royal Duchess

The cast boasts an eclectic cacophony of talents, ages and nationalities – including Whoopi Goldberg, Ru Paul and model-turned-feminist-activist Adwoa Aboah.

Alice in Wonderland has long been a source of inspiration, transcending the bounds of literary laurel with surrealistic interpretations cropping up across art, film and music.

Yet for Tim Walker, whose enchanting extravagance is responsible for creating some of the most loved images in fashion photography, this project is a particularly revolutionary: “It’s never been done before. Alice has never been told like this”, he said.

Tim Walker and Edward Enninful

Since its launch in 1964, the annual calendar has had a history for unveiling the lithe limbs of supermodels.

However, in recent years it has acquired more of a social commentary aesthetic, acting as a cultural lens through which important conversations can be conveyed artistically.

The 2016 calendar breached conformity by featuring an array of powerful women famed for their professional, social, cultural, sporting and artistic accomplishment, shot by esteemed photographer Annie Leibovitz.

Serena Williams, Amy Schumer and Yoko Ono all starred in what was an incredibly inspiring amalgamation of women of varying races, ages and body types that we don’t see enough of in popular culture.

Ru Paul pictured with Australian model Duckie Thot as Alice and Enninful.

Though Pirelli have featured an all-black cast before - in 1987, starring a 16-year-old Campbell - the cultural relevance and overriding tone this time around feels more pertinent than ever.

“This is an important step in culture development – to push images that aren’t generic, that don’t conform to stereotypes,” said model Thando Hopa, who plays the Princess of Hearts.

Slick Woods plays the Mad Hatter

In an industry where lack of representation is constantly coming under question, the calendar marks an important part in the seismic shift that's been shaking up the fashion world in recent months.

Brands are championing diversity more than ever before, with Gucci’s latest campaign featured an all-black cast and the autumn/winter 2017 runways boasted the most racially diverse cast of models to date.

Not to mention the fact that this year's calendar was styled by Edward Enninful, who will not only be the first black editor of British Vogue, but the first male to take the helm of the title in its 100 year history.

The former W magazine creative director was awarded an OBE in 2016 for his services to the fashion industry. His appointment to Vogue, which was announced in April, was hailed as a “historic moment” by Campbell, his long time friend who has since been named as a contributing editor to the title.

Enninful pictured with Campbell at this year's Met Gala. (Rex Features)

His work for Pirelli follows a string of projects champion diversity, including an issue of W featuring all-black models in 2015 and a recent campaign for Gap which brought together a mixture of faces from the art and music worlds including Priyanka Chopra and Yara Shahidi.

Pirelli is an inaugural indication of Enninful's acclaimed revolutionary spirit, for whom diversity is more than just a trend. His refreshing approach will undoubtedly give the fashion industry the contemporary revival it's been craving when he joins Vogue next month.

Maybe, just maybe “the times they are a changing”.

Output: The 2018 Pirelli Calendar is to feature an all-black cast of models in poses that pay homage to the original "Alice in Wonderland" illustrations by John Tenniel.  Models will include Naomi Campbell, Adwoa Aboah, Sean “Diddy” Combs, Whoopi Goldberg, and Ru Paul. Pirelli previously used all-black models, including a 16-year-old Campbell, in 1987. The company’s 2016 calendar also defied convention by featuring images of powerful women famous for artistic, cultural, social, and sporting achievements, including Yoko Ono and Serena Williams, photographed by Annie Leibovitz.


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Student housing accounts for one tenth of commercial investment
 The student housing market is growing and is predicted to account for £1 in every £10 invested in commercial property this year, according to the latest analysis from JLL.

The analysis by the real estate services and investment management specialists showed that £1.9bn has been invested in the student housing market so far this year.

This is an increase on the £1.7bn that was invested in the same period last year.

At present, there is over £3bn of investment stock pending in the market which is thought to be completed in 2017.

Student housing has been one of the main drivers in the growth in alternatives investment volumes and it is expected to account for 34.7% of alternatives investment volumes this year.

JLL’s analysis predicts that investment volumes will hit £5.4bn by the end of the year, up on the £3.2bn reached in 2016.

This year, Unite Students acquired 640 beds across two sites in Birmingham and Durham for £56m.

This is in addition to Watkin Jones’ disposal of a development portfolio of six schemes to Europa Generation, providing 1,691 beds for £165m.

Poll As a broker, do you currently quote 'green' loan options alongside standard loan quotes for property development finance? Yes No Vote Results

JLL believes there will be more growth in university student housing partnerships as there is an estimated requirement of a further £5bn needed to meet demand to develop new beds and upgrade ageing stock.

Philip Hillman, chairman of JLL’s alternatives team, said: “Amid a slowdown in some real estate capital markets, the robust and defensive qualities of alternatives assets remain highly attractive in the current climate, as demonstrated by the strong levels of investment in the student housing sector in the first half of 2017.

“The softening of the ‘hard Brexit’ rhetoric as a result of the general election result may lead to reconsideration of the Conservative manifesto pledge to keep student visas in any immigration cap.

“This will be further underpinned by demographic fundamentals as the number of 18- to 19-year-olds in the UK is set to increase at a rate of 40,000 per annum for the three years from 2022.

“These are both likely to support a robust performance in the student housing sector.”

JLL predicts that 70% of investment volumes in 2017 will comprise portfolio transactions.

Output: The UK student housing market will account for £1 in every £10 invested in commercial property this year, according to Property manager JLL. An analysis of real estate services and investment management specialists has found that £1.9bn has been invested in the student housing market in 2017 alone. It marks an increase of £0.2bn on the same period in 2016. JLL also found that there is over £3bn of investment still due to be made in 2017.


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Peer-to-peer blockchain network to allow EV charger sharing
 The Share&Charge mobile app connects EV drivers with available residential and commercial EV charging stations and facilitates blockchain-based payments from visiting EV drivers to station owners. The new sharing platform aims to increase the availability of public charging stations and decrease range anxiety current and prospective EV drivers experience. This partnership marks the first peer-to-peer charging network to use blockchain technology in North America.

Starting this summer, California residential and commercial owners of electric vehicle charging stations enabled with eMotorWerks ’ JuiceNet smart-grid charging technology will have the opportunity to rent out charging time on their stations to EV drivers participating in a new peer-to-peer (P2P) network powered by MotionWerk’s Share&Charge open platform. Share&Charge was founded by the innogy Innovation Hub.

In today’s marketplace, the availability of public EV charging is still of concern to potential EV drivers. However, P2P charging opens the opportunity to break free of infrastructure limitations and gasoline oligopolies to access electricity for their cars. By establishing networks of individuals willing to share their EV charging stations, we are opening up more charging options to EV drivers, while at the same time ensuring station owners are compensated accordingly.

As one of the most popular EV charging solutions in the United States and Europe, eMotorWerks is the perfect partner for our debut in the United States. With this new sharing technology we are bringing to North America, we aim to prove how blockchain technology can make sharing and payment easier and more efficient. We are excited to enable anyone, from individual, to small company or large utility to share their charging stations for an accelerated growth of emobility. —Dietrich Sümmerman of Share&Charge

Expanding its P2P charging network already established in Germany, Share&Charge leverages decentralized and transparent Ethereum-powered blockchain technology to allow people to interlink with each other to share and bill products and services securely and conveniently.

Through the app, residential and commercial owners of JuiceNet enabled stations can share their charging asset with other EV drivers in the network. Meanwhile, any EV driver can download the Share&Charge app to see available charging facilities on a map and navigate to the closest charging station for charging. With a few clicks in the app, the station owners can choose the times to share their service with others and set the price to charge visiting drivers.

California owners of any JuiceNet enabled devices who would like to share their charging stations are eligible to participate in the new P2P network, but initial participation will be limited on a first-come first-serve basis.

Currently compatible devices include charging stations such as eMotorWerks JuiceBox Pro, Aerovironment EVSE-RS JuiceNet Edition, Clipper Creek HCS-40 JuiceNet Edition, and Nayax EVMeter.

Additionally, the new service is compatible with eMotorWerks’ JuicePlug smart-grid charging adapter that allows any charging station by any manufacturer to participate in the program. All drivers of an electric vehicle can sign up to make use of the shared residential charging stations.

The joint pilot program between eMotorWerks and Share&Charge is slated to begin 1 August 2017. Users can sign up to participate for the program by filling out the registration form on eMotorWerks website or by sending an email to [email protected].

Output: Electric vehicle (EV) charging companies eMotorWerks and Share&Charge will launch a blockchain-based peer-to-peer (P2P) network to allow EV users to pay the owners of charging stations. Powered with Ethereum, the Share&Charge blockchain platform will enable residential and commercial owners of eMotorWerks' JuiceNet charging stations to receive direct payment for rented out charging time. Any EV user can view and pay for available charging stations through Share&Charge's app. The partnership aims to increase the availability of public charging stations and simplify payments.


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L&G can prefab a fully-furnished one-bed flat in a week
 The first production run from a vast new factory outside Leeds began this week – with timber delivered at one end, and just a week later a fully furnished one-bed flat popping out the other.

Legal & General Homes is promising to build thousands of flats and houses a year at the revolutionary, and highly secretive, factory, and delivered around the country on the back of trucks. Is this the solution to the housing crisis – or a new age of soulless prefabs for rabbit hutch Britain?

In Richmond, south-west London, the future opened its doors on Wednesday, with the first of hundreds of housing units to be built by L&G, driven down the A1 and placed on site in just a couple of hours.

The housing association that has ordered the homes, RHP, buys them off-the-peg for at least 15% below the standard cost for onsite construction.

Home petite home! The RHP’s prefabricated flat. Photograph: Andrew Holt

It is an extraordinary move by L&G, better known as a car and home insurer, which if successful will catapault it into the top league of Britain’s housebuilders, albeit using a Ford-style production line.

This is not an Ikea-style flat-pack approach – what arrives on site is a “turn-key” home complete with a kitchen, fitted carpet, curtains and bathroom, and even furniture if requested.

The eight production lines at the highly automated 550,000 sq ft factory will be able to build around 3,500 houses and flats a year – a one bedder in one week, a two-bedder in two weeks. The timber-framed homes are made in modules, bolted together on site, with external cladding the only other extra required.

Small, perhaps, but it does boast some outdoor space. Photograph: Andrew Holt

“At full production, homes like this will be delivered repeatedly in a matter of weeks without the snagging issues faced by traditional methods,” saidNigel Wilson, the chief executive of L&G. “Just as the car industry was automated, so the UK’s traditional housebuilding sector now needs to step up. We need to build houses faster and more efficiently than ever before.”

For housing associations such as RHP, which took over 9,000 homes from the local council, the new L&G prefabs answer their most pressing need: accommodation for young, single, urban workers earning between £20,000 and £40,000 who do not qualify for conventional social housing but who are priced out of buying.

In Richmond, the average semi-detached home fetches more than £1m and Rightmove does not list a single one-bed flat to rent at less than £1,000 a month. RHP said the new L&G-built “modular” homes will be rented out at £600 to £700 a month.

For less than the price of most flatshares in the capital, tenants will receive a high-spec home complete with a luxury kitchen and lounge, separate bedroom and bathroom, underfloor heating and PV solar cells that promise to shave total energy bills to as little as £10 a year. There’s even a “smart door” that lets the tenant ping the entrance open remotely from their mobile at work should they need to let someone in.

The drawback? They are tiny. At just 26 sq metres (280 sq ft), the L&G/RHP homes squeeze living space down to levels never seen before in publicly sponsored housing.

New national space standards, introduced in 2011, demand that a one-bed flat for one person should be a minimum 37 sq m. The new modular homes will pitch housing associations desperate to build homes – and meet government targets for 200,000 new homes a year – against planners desperate to avoid a “race to the bottom” on home sizes.

At RHP, the development director, Robin Oliver, said: “It has been priced for a single person, and we wouldn’t expect a couple to live in the space. We’re not saying this is going to be the new norm – we see people renting it for six months to two years, then moving out as they have saved for a deposit. A lot of our own employees pay more than £600 a month for a room in a shared house. The most common question we are getting from them, is ‘how can I get one?’”.

RHP’s new prefab home.

The housing association is able to raise money to buy the units from L&G at interest rates of 2-3% and place them on infill and brownfield sites in the capital. Even on rents of £600-£700 per month, they require almost no public subsidy. Neither L&G or RHP will reveal the cost price of the units, although RHP said the cost is 15% below the standard £2,600 to £3,000 per sq m build cost of conventional homes in the borough, which indicates that the 26m sq flats cost £60,000- £70,000 to buy.

But RHP admits the homes still don’t have full planning permission – and they could have a battle on his hands.

At the Greater London Authority, Jennifer Peters, in charge of the London Plan, is determined to maintain existing space standards. “They [space standards] have made a real difference to the quality of development in London. I’m confident that space standards are right and will continue to be right,” she said, adding that if standards are relaxed, there is a risk that land values simply rise to reflect the extra units a developer can squeeze into a space. However, she adds that there could be “some flexibility if it can be demonstrated that it has an exceptional design”.

Much-needed storage space is found up high. Photograph: Andrew Holt

Britain already has some of the smallest homes in Europe, with the average new-build home around 76 sq m compared with 137 sq m in Denmark. Controversial office-to-residential conversions, outside normal planning rules, have produced some flats at just 14.9 sq m.

Will Wimshurst of Wimshurst Pelleriti, which designed the L&G home for RHP, said: “We’re not saying we’re against space standards. What we are saying is that there is a big problem in the middle of the market – companies just can’t hold on to workers in places such as London. These people are forced to leave, and they need a solution.”

Visitors to the new L&G homes expecting a shipping container with frills will be disappointed. The flats are higher than standard build, making an otherwise tight space feel more spacious, as well as allowing for more storage, with raised mezzanine beds giving extra space below.

The bedroom. Photograph: Andrew Holt

The housing association deliberately avoided primary colours to get away from the Lego-like feel of some other prefab units.

The factory construction allows buyers such as RHP to ask L&G to finish it to any specification, much like a car buyer does. Want to add a microwave? Change the size of the cupboards? Have the bed raised higher? It’s like ordering metallic paint or a sunroof from Ford. “The amazing thing is that you can just feed the design into the computer, then it’s cut to size in the factory,” said an associate at Wimshurst Pelleriti.

Legal & General’s prototype two-bed home, destined more for the suburbs than the city. Photograph: Handout

The two-bedder prototype unveiled by L&G this week, and designed for couples and small families rather than singles, is much larger at 82 sq m and will have no issues meeting current space standards. It has a more conventional look, designed for the suburbs rather than city centres.

For now, both the one and two bedders are prototypes, with RHP expecting the first tenants – subject to planning permission – through its doors in early 2018.

Output: Legal & General Homes (L&G) is to create 3,500 flats and houses a year from its new factory just outside Leeds, which can build a fully-furnished one-bedroom flat in just one week. L&G aims to provide turn-key complete homes that can be manufactured and transported within weeks. Although the homes are small, starting at just 26 sq m, if the price is right, and full planning permission granted, they could be a step on to the property ladder for many people otherwise unable to do so. A housing association in Richmond, southwest London, has just taken delivery of the first order for the homes.


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Education data breach valued at $245 per record
 Data Security

Average Cost Per Record of US Data Breach in Ed: $245

The average cost of a data breach in the United States rose for the fourth straight year, hitting $225 per compromised record--the highest it has been since 2006, when the Ponemon Institute began to publish research on the topic.

In education, which tends to be more heavily regulated regarding data privacy, the average "per capita" cost for 2017 in this country is even higher: $245. That's considerably more than the worldwide per-record cost in education of $200. (Per capita represents the total cost of the data breach divided by the number of lost or stolen records.)

According to Ponemon's "2017 Cost of Data Breach Study," the average total organizational cost across all segments, not just education, is $7.35 million, up almost five percent over last year's $7 million. The average number of records exposed was 28,512. The major component of that expense--about $1.51 million--is related to the business lost because of the breach: turnover of customers or "churn," increased customer acquisition cost, "reputation losses" and "diminished goodwill." Education, as an industry, experiences far less churn (1.8 percent) compared to other segments, such as financial or life sciences (7.1 percent and 5.7 percent, respectively).

The next largest portion of the expense ($1 million) is tied to detection and escalation efforts, such as forensics, root cause determination, identifying victims and organizing a response. That's followed by related services ($930,000), such as help desk operations, inbound communications, product discounts and setting up subscriptions to identity protection services for victims. The smallest aspect of the cost of a data breach is the expense of notifying the affected people and regulators; that equals about $199,000.

Ponemon reported that nearly half of U.S. data breaches (47 percent) are due to "malicious or criminal attack." These are also the most expensive type of breach to resolve. Another 28 percent come about through human error; and 25 percent occur because of "system glitches, including both IT and business process failures."

New factors that the research took into consideration as the results were being compiled included two areas of importance to schools: the extensive use of mobile platforms, which tacked an additional cost of $6.50 per record breached, and compliance failures, which added a whopping $19.30 per capita.

Compared to other types of organizations, education tends to take a long time to identify and contain data breaches. On average, worldwide, education takes 221 days for the first part of the work and 83 days for the second part. As a comparison, financial takes only 155 days to identify a potential breach and 34 days to respond and contain it. those aspects are important, the research noted, because the longer the duration of those two aspects of data breaches, the higher the cost to the organization.

The report offered several strategies for reducing the cost of future data breaches. For example, organizations that have an incident response team in place tend to lower the damage control cost per record by more than $19. Those that use encryption extensively save about $16. And a solid training program for employees has an impact of $12.50. These aren't cumulative because there's so much overlap, explained Researcher Larry Ponemon during a recent presentation covering the results of the report. "Companies that have an [incident response] team probably also use encryption extensively."

Keeping up with the bad guys "can be a problem," Ponemon added. However, in the many years he has studied data breaches, he has also seen a positive side: "Most organizations that we have studied over time have improved their security posture by using more and better technologies and relying more on intelligence [and becoming] more systematic in terms of how they approach the data breach event." That's a trend, he noted, "consistent across industries and also geographies."

The full study examined the cost of data breaches for 419 companies worldwide in 17 industries. IBM sponsored the research. Both the worldwide report and country-specific reports are available for registration on the IBM security website here.

Output: The average per-record cost for a data breach in the heavily regulated education sector has risen for the fourth consecutive year to $245, far higher than the global $200, according to a study by the Ponemon Institute. It found education experiences low turnover of customers after a breach, with just 1.8%, compared to 7.1% in the financial sector and 5.7% in life sciences. The study also revealed the total average cost across 419 businesses in 17 countries was $7.35m, up 5% on the 2016 figure of $7m.


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Humaniq set to release beta currency platform in Ghana
 “…next year the platform will be expanded to support additional financial services like insurance, business financing, and even an in-app e-commerce system.”

Humaniq will trial its digital banking platform in Ghana starting at the end of this month.

A ‘Lite’ version of its flagship app will launch on Android on July 31st, allowing users to test the company’s HMQ cryptocurrency. Users will be prompted to register their biometrics for subsequent logins, and will then get access to HMQ. From there, users will be able to store and transfer HMQ to others, even those who haven’t yet signed up for the app.

Humaniq says its aim is to bring inclusive financial services to the world’s unbanked. It plans to launch a ‘Pro’ version of the app for both Android and iOS to the general public “later in the year,” according to a statement from the company; and it says next year the platform will be expanded to support additional financial services like insurance, business financing, and even an in-app e-commerce system.

The face recognition biometric technology featured on the HumaniQ app is provided by VisionLabs, a visual recognition company.

HumaniQ says it will offer numerous further details about the platform and its plans at a presentation and meeting on July 26th at Barclays’ Rise London FinTech space.

Output: Blockchain start-up Humaniq will launch its digital banking platform in Ghana as it aims to offer its services to the country's unbanked population, according to a company statement. It said a 'lite' version of its app will launch on Android on 31 July, offering a taste of the firm's HMQ digital currency, during which time users can register with facial recognition technology for access to the full platform. Humaniq said it plans to launch a Pro version on iOS and Android later in the year, and will offer more details at this week's Barclays’ Rise London FinTech event.


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BoA to halt deals with China's HNA Group over debt concerns
 LONDON/HONG KONG (BLOOMBERG) - Bank of America has told investment bankers to stop working on transactions with HNA Group for now amid growing concerns about the acquisitive Chinese conglomerate's debt levels and ownership structure, according to people familiar with the matter.

The US investment bank joins other Wall Street firms, including Citigroup and Morgan Stanley, that are largely steering clear of advising and financing the group on deals because they are unable to get internal approvals from "know your customer" committees, the people said, asking not to be identified because the information is private.

Bank of America had advised HNA on several attempted overseas acquisitions in the past few years, people said. The decision has affected deals the firm was working on for HNA, including the planned Singapore IPO of HNA Commercial Reit, two of the people said. The Reit was expected to raise some S$700 million.

Banks regularly reassess their comfort with potential clients, and their stance towards HNA could change, they said.

HNA has not done significant fee-paying business with Bank of America in recent months, one person with knowledge of the company said.

Senior officials at Bank of America's Merrill Lynch unit communicated internally last month that bankers should not currently pitch for new acquisitions and fund-raisings, the people said. Scrutiny of Chinese companies came into focus this week after people familiar with the matter said that China plans to cut off some funding for billionaire Wang Jianlin's Dalian Wanda Group, concluding the conglomerate breached restrictions for overseas investments.

An internal memo at Bank of America on holding off on deals with HNA for now went to fewer than five bankers who would be in a position to solicit business from the Chinese company, another person familiar with the matter said. The New York Times reported earlier that Bank of America had said in an internal e-mail that it had decided to remove itself from transactions with HNA.

Citigroup's and Morgan Stanley's internal committees have also struggled to get sufficient clarity on the source of funds and ownership structures at HNA, leading those banks to avoid deals for some time, the people said. Still, some firms that shy away from the parent company are willing to do business with HNA units. Morgan Stanley was one of the banks that committed to a total US$8.5 billion (S$11.63 billion) in financing for Avolon, a business owned by one of HNA's listed arms, in its purchase of CIT Group Inc.'s airline leasing business last year.

A representative for HNA could not immediately comment. Representatives for Bank of America, Citigroup and Morgan Stanley declined to comment.

Support from Western banks has helped fuel a debt-backed buying spree by HNA, as it expanded from its home base on China's sunny Hainan island to add logistics, hotel and financial assets around the globe, including a US$6.5 billion deal to buy a stake in Hilton Worldwide Holdings announced last year. Chinese regulators have begun assessing local banks' loan exposure to HNA and are examining examples of acquisitions gone awry, people with knowledge of the matter have said.

Still, banks including JPMorgan Chase & Co and UBS Group have financed and advised on large HNA deals this year, notably the Hilton stake and the firm's acquisition of a 10 per cent stake in German lender Deutsche Bank AG.

Even UBS, which has historically helped HNA on multiple transactions, has started monitoring the conglomerate's debt levels more closely, separate people said. The Swiss bank is increasingly concerned that the Chinese company would struggle in the short term to complete large acquisitions, according to one of the people. UBS continues to do business with HNA, though its internal risk and compliance teams have begun asking more questions about dealings with the Chinese firm, another person said.

UBS advised HNA on its US$1.5 billion acquisition of Gategroup Holding, which completed this year. The Swiss lender has been one of the most active bankers for HNA, advising the firm on almost US$15 billion of aviation-related acquisitions since 2015, according to data compiled by Bloomberg. It also provided collar financing to help the conglomerate increase its stake in Deutsche Bank, people familiar with the matter said in May.

A spokesman for UBS declined to comment.

The pushback comes as HNA has been working to raise its profile in the West, hosting the French Open tennis tournament this year, a first for the firm. Executives including chairman Li Xianhua and chief executive officer Adam Tan kicked off with a gala celebration in Le Petit Palais in Paris that included politicians, bankers and celebrity chef Joel Robuchon.

HNA has recently told bankers it plans to slow the pace of its overseas dealmaking, according to one of the people with knowledge of the matter. The move comes as acquisitive Chinese companies are under increasing scrutiny at home. The China Banking Regulatory Commission asked some banks to provide information on overseas loans made to Dalian Wanda, Anbang Insurance Group, HNA, Fosun International and the Chinese owner of Italian soccer team AC Milan, people familiar with the matter said in June.

China is working to cut capital outflows that may be heaping pressure on the value of the yuan and, late last year, moved to temporarily restrict the largest deals valued at US$10 billion or more, people familiar with the matter said at the time.

HNA's ownership is difficult to decipher as the group is held together through scores of companies - mostly unlisted entities with little available public information - holding stakes in one another. Atop the hierarchy is a person named Guan Jun, according to Chinese corporate filings.

Little is known about Guan. HNA plays down his role, with CEO Adam Tan saying he is just a Chinese businessman and chairman Chen Feng telling the South China Morning Post newspaper that Guan is not a significant shareholder as he owns only a "tiny" stake. Yet Guan owns the equivalent of a 29 per cent stake in the group, more than any of HNA's executives, including Chen and Tan's stakes combined.

HNA's ownership has also been under attack from Guo Wengui, a fugitive Chinese tycoon who has been alleging HNA has secret ties to powerful Communist Party officials - claims denied by the company. Guo is facing defamation lawsuits from HNA and others over his various claims.

Its governance has drawn questions from the likes of The New York Times, which on Wednesday reported that HNA has been doing business deals with family and friends of its top executives in the past quarter century, with limited disclosure to investors. In response to the article, HNA said its related-party transactions are reviewed and documented on terms consistent with appropriate standards.

HNA's financing practices have also stood out. Its latest annual report says the company is saddled with US$73 billion of debt, which would be the second-highest debt level for a non-financial corporation in China if HNA were to be listed, according to data compiled by Bloomberg. What is more, HNA filings show HNA and its units have pledged at least US$24 billion of shares across 15 publicly traded firms to finance its acquisitions, signalling a pattern of reliance on pledged assets that has triggered concerns from credit-rating agencies and analysts. HNA has said it has consulted financial advisers on all its pledge transactions.

Output: Bank of America has announced plans to cease transactions with China's HNA Group due to growing concerns over the company's debt levels and ownership structure, according to sources. This comes as other banks like Citigroup and Morgan Stanley advise bankers to avoid the company. An impact on the deals made by Bank of America with HNA is expected, including the planned Singapore IPO of HNA Commercial Reit. Highly acquisitive Chinese companies, like HNA, have recently come under increasing scrutiny by Chinese authorities.


Instruction: create a high quality summary of the given input

Input:
CMS Moves Toward Much-Needed 340B Reforms
 Insight

Tara O'Neill Hayes

In order for a manufacturer’s drugs to be covered by the Medicaid program, the manufacturer must agree to participate in the 340B Drug Pricing Program (340B). Under the 340B program, manufacturers must provide discounts to eligible health care providers for covered outpatient drugs. As the federal government pays for roughly 40 percent of all prescription drugs in the United States,[1] these discounts are intended to allow “scarce Federal resources [to be stretched] as far as possible.” However, because the law does not require the health care providers who receive these discounts to pass their savings along to consumers, many question whether the program’s goal is being met and if reforms are needed. To that end, the Centers for Medicare and Medicaid Services (CMS) proposed last week to adjust the Medicare reimbursement rate for drugs obtained through 340B and provided to Part B enrollees.[2]

Background

The 340B program was established in response to the development of an unintended consequence of Medicaid’s “best price” policy. Because no exception to the “best price” policy was provided for drug manufacturer’s charitable giving—in which medicines were provided for free or at an extreme discount for uninsured and low-income patients, most of those donations disappeared and hospitals were often left footing the bill. In response, Congress amended the Public Health Service Act, adding Section 340B, which set a ceiling price (essentially, the price charged to Medicaid after statutory rebates are accounted for under the “best price” policy) that drug manufacturers may charge for such drugs provided to “covered entities.” [3] This change thus formalized and expanded the former practice of charitable giving by mandating minimum discounts be provided to certain hospitals and other outpatient centers.

While these discounts were intended to be targeted to uninsured and low-income patients, the number of entities eligible for such discounts has increased dramatically over the years—particularly with the expanded definition of a “covered entity” provided in the Affordable Care Act (ACA)—and the broad definition of “qualified patient” for whom these discounts must be provided. Further, current law does not require that these discounts be passed on to either the patient and/or the insurer, including the Federal government, paying for drugs obtained through the 340B program. Patients and taxpayers are therefore not necessarily benefitting from the mandated discounts.

In addition to the discounts provided directly through 340B, the same law provides for the creation of Prime Vendor Program (PVP) which can provide entities additional savings beyond the 340B discount. According to the Department of Health and Human Services (HHS), PVP participants receive an estimated average discount of 10 percent of the 340B price.[4]

Proposed Rule

On July 13, 2017, CMS issued a proposed rule that would, among other things, change the Medicare Part B reimbursement rate for drugs obtained through 340B. Currently, Medicare pays providers for covered 340B drugs just as it does for any other drug covered under Medicare Part B: the average sales price (ASP) plus six percent of the ASP. This payment formula is set in statute and the six percent add-on serves as an administrative dispensing fee, common among prescription drug reimbursement formulas. Under the proposed rule, CMS would instead pay for drugs obtained at a discount through the 340B program and provided to Medicare beneficiaries ASP – 22.5 percent.[5] This payment change will more closely reflect the actual acquisition cost faced by hospitals for such drugs, as explained below.

Potential Impact

If this proposal goes into effect, Medicare beneficiaries and taxpayers stand to reap significant savings. Because beneficiaries pay their coinsurance (20 percent under Medicare Part B) based on Medicare’s reimbursement rate, beneficiaries will pay significantly less for the same drug as a result of this change. Medicare will also save substantial amounts. According to MedPAC, 48 percent of Medicare Part B drug spending goes to 340B hospitals and totaled $3.5 billion in 2013, up from 22 percent and $0.5 billion in 2004.[6] Much of this increased spending is a result of the dramatic increase in the number of entities participating in 340B. Between 2005 and 2014, the number of hospitals participating in 340B grew from 583 to 2,140, largely as a result of the ACA’s expansion of eligible entities.[7]

To illustrate potential savings, imagine the average sales price of a drug is $100. Under current law, Medicare would pay the provider $106 and the beneficiary would pay $21.20. Under this new proposal, Medicare would instead pay $77.50 and the beneficiary would pay $15.50. Total savings to Medicare and the beneficiary for that drug would be $34.20.

As for the hospitals—recent reports suggest the impact to their bottom line should be minimal. Again, the total dollar value at stake, based on 2013 Medicare expenditures, is roughly $1 billion. Revenue from the top seven non-profit hospitals alone, as ranked by U.S. News & World Report, totaled nearly $34 billion in 2015, while their charity care fell to $272 million.[8] Further, the proposed new payment rate is based on findings from multiple government agencies regarding the average amount of savings received by entities participating in 340B. In May 2015, the Medicare Payment Advisory Commission (MedPAC) reported that, on average, 340B hospitals receive a minimum discount of 22.5 percent of the ASP.[9] The HHS Office of the Inspector General (HHS OIG) found that in 2013 payments made by Medicare Part B and the coinsurance paid by beneficiaries for 340B drugs were 58 percent higher than the ceiling price which may have been charged to the hospitals to obtain the drugs; this difference between the cost to the hospital and the reimbursement amount allowed hospitals to retain approximately $1.3 billion that year from 340B discounts alone.[10] The Government Accountability Office (GAO) has found 340B participation to be associated with higher Medicare expenditures: in 2012, average spending per Medicare beneficiary at 340B hospitals was more than double expenditures at non-340B hospitals, and this difference was not explained by patients’ health status.[11] Finally, there are a plethora of other programs designed to provide safeguards to hospitals treating significant numbers of uninsured and underinsured patients, including the Disproportionate Share Hospital (DSH) program and bad debt payments made by Medicare—though both of these programs could also use reform.[12]

Additional Reforms Still Needed

As outlined by the American Action Forum here and by the aforementioned reports from the GAO, MedPAC, and HHS OIG, the 340B program suffers from a lack of appropriate benchmarks for determining program eligibility, clear guidance regarding use of savings, and necessary program oversight. The House Energy and Commerce Subcommittee on Oversight recently held a hearing highlighting the lack of resources available to provide proper oversight in the 340B program. Accordingly, non-compliance rates between FY2012-FY2016 ranged from 63 to 82 percent.[13] The program no longer seems to be serving its intended purpose and warrants substantial reform.

The proposal outlined by CMS is a worthwhile first step in providing much-needed reform to this ever-expanding program. But it just serves as a band-aid, attempting to mitigate the impact of the underlying problems. Congress should work to enact additional reforms that ensure program integrity, and that savings are distributed appropriately.

[1] https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/index.html

[2] https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheet-items/2017-07-13.html?DLPage=1&DLEntries=10&DLSort=0&DLSortDir=descending

[3] https://www.hrsa.gov/opa/programrequirements/publiclaw102585.html

[4] https://www.hrsa.gov/about/budget/budgetjustification2017.pdf

[5] https://s3.amazonaws.com/public-inspection.federalregister.gov/2017-14883.pdf

[6] http://www.medpac.gov/docs/default-source/reports/may-2015-report-to-the-congress-overview-of-the-340b-drug-pricing-program.pdf?sfvrsn=0

[7] http://www.medpac.gov/docs/default-source/reports/may-2015-report-to-the-congress-overview-of-the-340b-drug-pricing-program.pdf?sfvrsn=0

[8] http://www.politico.com/interactives/2017/obamacare-non-profit-hospital-taxes/

[9] http://www.medpac.gov/docs/default-source/reports/may-2015-report-to-the-congress-overview-of-the-340b-drug-pricing-program.pdf?sfvrsn=0

[10] https://oig.hhs.gov/oei/reports/oei-12-14-00030.pdf

[11] https://www.gao.gov/assets/680/670676.pdf

[12] http://www.gao.gov/assets/680/678127.pdf

[13] http://docs.house.gov/meetings/IF/IF02/20170718/106269/HHRG-115-IF02-20170718-SD002.pdf

Output: In order for a manufacturer’s drugs to be covered by the Medicaid program, the manufacturer must agree to participate in the 340B Drug Pricing Program (340B). Under the 340B program, manufacturers must provide discounts to eligible health care providers for covered outpatient drugs.


Instruction: create a high quality summary of the given input

Input:
ASCO Advocates Value in Drug Pricing
 Potential solutions to improve affordability of cancer drugs require prioritizing and testing and then should be applied in a standardized way to assess drug value, according to a new position statement from the American Society of Clinical Oncology (ASCO).

Value and affordability have emerged as central issues in cancer drug development, as the cost of new cancer drugs routinely exceeds $100,000 a year. Many patients delay or forgo treatment because they cannot afford drugs, which have become the fastest-growing component of cancer care costs, ASCO officials said in a statement.

A majority of patients with cancer report distress related to financial aspects of their care, and they declare bankruptcy twice as often as the general population.

"In what, undoubtedly, is one of the most difficult times in their lives, individuals with cancer should be focused on getting the best care possible, not worrying about financial strain on their families," said ASCO CEO Clifford Hudis, MD. "As cancer doctors, we're accountable for ensuring our patients receive the right drug at the right time, but that alone isn't going to rein in costs. We need our nation's leaders to tackle the major drivers of patients' cost burdens, including rising prices."

As a first step toward reducing the cost of cancer drugs, ASCO calls on stakeholders from "across the healthcare sector" to come together to identify, prioritize, and test potential solutions to address the affordability of cancer drugs. The stakeholders should then develop or define a standard, broadly applicable approach to assess the value of drugs and inform drug pricing and reimbursement.

A number of potential solutions have already been set forth by various individuals and groups, but prioritizing and testing cannot proceed without an agreed-upon definition of value, said position statement co-author Blase Polite, MD, of the University of Chicago.

"Once you define value, once you reach some general agreement, then you can test all sorts of different proposals," Polite told MedPage Today. "But you can't do any of it until you can come up with some fundamental agreement on how to assess the value of a drug."

Several "pretty sophisticated" efforts to define value have been put on the table, each with its own strengths and weaknesses, Polite continued. Evaluation of those definitions will require policymakers to prioritize testing and authorize demonstrations, perhaps beginning with one or two payment models.

ASCO officials acknowledged "unprecedented success" with recent therapeutic development in oncology but noted that "in some cases, the price of a new drug bears no relation to its effectiveness." One study showed that only 19% of cancer drugs recently approved by the FDA met criteria for "clinically meaningful outcomes."

In the position statement, ASCO suggested the FDA consider using meaningful clinical outcomes when assessing new and supplemental drug applications, rather than "small benefits that achieve statistical significance in large trials." ASCO previously published a position statement that included a recommended definition of clinically meaningful outcomes.

ASCO also suggested that Medicare test the feasibility of a "value-based pathway" to encourage providers to use higher-value drugs and encourage the pharmaceutical industry to develop high-value treatments.

"We begin setting the expectation that, when pharma designs trials, they understand what the rules of the game are in terms of value thresholds," said Polite. "If you say 'these are the kinds of hazard ratios, tails on [survival] curves, quality of life that we expect for something to have real uptake in the market,' then we hope they start designing clinical trials around that."

The complete position statement is available on the ASCO website.

Charles Bankhead is senior editor for oncology and also covers urology, dermatology, and ophthalmology. He joined MedPage Today in 2007. Follow

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Output: Potential solutions to improve affordability of cancer drugs require prioritizing and testing and then should be applied in a standardized way to assess drug value, according to a new position statement from the American Society of Clinical Oncology (ASCO).


Instruction: create a high quality summary of the given input

Input:
The Myth of Drug Expiration Dates
 This story was co-published with NPR’s Shots blog.

The box of prescription drugs had been forgotten in a back closet of a retail pharmacy for so long that some of the pills predated the 1969 moon landing. Most were 30 to 40 years past their expiration dates — possibly toxic, probably worthless.

But to Lee Cantrell, who helps run the California Poison Control System, the cache was an opportunity to answer an enduring question about the actual shelf life of drugs: Could these drugs from the bell-bottom era still be potent?

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Cantrell called Roy Gerona, a University of California, San Francisco, researcher who specializes in analyzing chemicals. Gerona had grown up in the Philippines and had seen people recover from sickness by taking expired drugs with no apparent ill effects.

“This was very cool,” Gerona says. “Who gets the chance of analyzing drugs that have been in storage for more than 30 years?”

The age of the drugs might have been bizarre, but the question the researchers wanted to answer wasn’t. Pharmacies across the country — in major medical centers and in neighborhood strip malls — routinely toss out tons of scarce and potentially valuable prescription drugs when they hit their expiration dates.

Gerona and Cantrell, a pharmacist and toxicologist, knew that the term “expiration date” was a misnomer. The dates on drug labels are simply the point up to which the Food and Drug Administration and pharmaceutical companies guarantee their effectiveness, typically at two or three years. But the dates don’t necessarily mean they’re ineffective immediately after they “expire” — just that there’s no incentive for drugmakers to study whether they could still be usable.

ProPublica has been researching why the U.S. health care system is the most expensive in the world. One answer, broadly, is waste — some of it buried in practices that the medical establishment and the rest of us take for granted. We’ve documented how hospitals often discard pricey new supplies, how nursing homes trash valuable medications after patients pass away or move out, and how drug companies create expensive combinations of cheap drugs. Experts estimate such squandering eats up about $765 billion a year — as much as a quarter of all the country’s health care spending.

What if the system is destroying drugs that are technically “expired” but could still be safely used?

In his lab, Gerona ran tests on the decades-old drugs, including some now defunct brands such as the diet pills Obocell (once pitched to doctors with a portly figurine called “Mr. Obocell”) and Bamadex. Overall, the bottles contained 14 different compounds, including antihistamines, pain relievers and stimulants. All the drugs tested were in their original sealed containers.

The findings surprised both researchers: A dozen of the 14 compounds were still as potent as they were when they were manufactured, some at almost 100 percent of their labeled concentrations.

“Lo and behold,” Cantrell says, “The active ingredients are pretty darn stable.”

Cantrell and Gerona knew their findings had big implications. Perhaps no area of health care has provoked as much anger in recent years as prescription drugs. The news media is rife with stories of medications priced out of reach or of shortages of crucial drugs, sometimes because producing them is no longer profitable.

Tossing such drugs when they expire is doubly hard. One pharmacist at Newton-Wellesley Hospital outside Boston says the 240-bed facility is able to return some expired drugs for credit, but had to destroy about $200,000 worth last year. A commentary in the journal Mayo Clinic Proceedings cited similar losses at the nearby Tufts Medical Center. Play that out at hospitals across the country and the tab is significant: about $800 million per year. And that doesn’t include the costs of expired drugs at long-term care pharmacies, retail pharmacies and in consumer medicine cabinets.

After Cantrell and Gerona published their findings in Archives of Internal Medicine in 2012, some readers accused them of being irresponsible and advising patients that it was OK to take expired drugs. Cantrell says they weren’t recommending the use of expired medication, just reviewing the arbitrary way the dates are set.

“Refining our prescription drug dating process could save billions,” he says.

But after a brief burst of attention, the response to their study faded. That raises an even bigger question: If some drugs remain effective well beyond the date on their labels, why hasn’t there been a push to extend their expiration dates?

It turns out that the FDA, the agency that helps set the dates, has long known the shelf life of some drugs can be extended, sometimes by years.

In fact, the federal government has saved a fortune by doing this.

For decades, the federal government has stockpiled massive stashes of medication, antidotes and vaccines in secure locations throughout the country. The drugs are worth tens of billions of dollars and would provide a first line of defense in case of a large-scale emergency.

Maintaining these stockpiles is expensive. The drugs have to be kept secure and at the proper humidity and temperature so they don’t degrade. Luckily, the country has rarely needed to tap into many of the drugs, but this means they often reach their expiration dates. Though the government requires pharmacies to throw away expired drugs, it doesn’t always follow these instructions itself. Instead, for more than 30 years, it has pulled some medicines and tested their quality.

The idea that drugs expire on specified dates goes back at least a half-century, when the FDA began requiring manufacturers to add this information to the label. The time limits allow the agency to ensure medications work safely and effectively for patients. To determine a new drug’s shelf life, its maker zaps it with intense heat and soaks it with moisture to see how it degrades under stress. It also checks how it breaks down over time. The drug company then proposes an expiration date to the FDA, which reviews the data to ensure it supports the date and approves it. Despite the difference in drugs’ makeup, most “expire” after two or three years.

Cantrell keeps a collection of old bottles of chemicals and medicines. He’s tested some of them and found that they’re still potent. (Sandy Huffaker for ProPublica)

Once a drug is launched, the makers run tests to ensure it continues to be effective up to its labeled expiration date. Since they are not required to check beyond it, most don’t, largely because regulations make it expensive and time-consuming for manufacturers to extend expiration dates, says Yan Wu, an analytical chemist who is part of a focus group at the American Association of Pharmaceutical Scientists that looks at the long-term stability of drugs. Most companies, she says, would rather sell new drugs and develop additional products.

Pharmacists and researchers say there is no economic “win” for drug companies to investigate further. They ring up more sales when medications are tossed as “expired” by hospitals, retail pharmacies and consumers despite retaining their safety and effectiveness.

Industry officials say patient safety is their highest priority. Olivia Shopshear, director of science and regulatory advocacy for the drug industry trade group Pharmaceutical Research and Manufacturers of America, or PhRMA, says expiration dates are chosen “based on the period of time when any given lot will maintain its identity, potency and purity, which translates into safety for the patient.”

That being said, it’s an open secret among medical professionals that many drugs maintain their ability to combat ailments well after their labels say they don’t. One pharmacist says he sometimes takes home expired over-the-counter medicine from his pharmacy so he and his family can use it.

The federal agencies that stockpile drugs — including the military, the Centers for Disease Control and Prevention and the Department of Veterans Affairs — have long realized the savings in revisiting expiration dates.

In 1986, the Air Force, hoping to save on replacement costs, asked the FDA if certain drugs’ expiration dates could be extended. In response, the FDA and Defense Department created the Shelf Life Extension Program.

Each year, drugs from the stockpiles are selected based on their value and pending expiration and analyzed in batches to determine whether their end dates could be safely extended. For several decades, the program has found that the actual shelf life of many drugs is well beyond the original expiration dates.

A 2006 study of 122 drugs tested by the program showed that two-thirds of the expired medications were stable every time a lot was tested. Each of them had their expiration dates extended, on average, by more than four years, according to research published in the Journal of Pharmaceutical Sciences.

Some that failed to hold their potency include the common asthma inhalant albuterol, the topical rash spray diphenhydramine, and a local anesthetic made from lidocaine and epinephrine, the study said. But neither Cantrell nor Dr. Cathleen Clancy, associate medical director of National Capital Poison Center, a nonprofit organization affiliated with the George Washington University Medical Center, had heard of anyone being harmed by any expired drugs. Cantrell says there has been no recorded instance of such harm in medical literature.

Marc Young, a pharmacist who helped run the extension program from 2006 to 2009, says it has had a “ridiculous” return on investment. Each year the federal government saved $600 million to $800 million because it did not have to replace expired medication, he says.

An official with the Department of Defense, which maintains about $13.6 billion worth of drugs in its stockpile, says that in 2016 it cost $3.1 million to run the extension program, but it saved the department from replacing $2.1 billion in expired drugs. To put the magnitude of that return on investment into everyday terms: It’s like spending a dollar to save $677.

“We didn’t have any idea that some of the products would be so damn stable — so robustly stable beyond the shelf life,” says Ajaz Hussain, one of the scientists who formerly helped oversee the extension program.

Hussain is now president of the National Institute for Pharmaceutical Technology and Education, an organization of 17 universities that’s working to reduce the cost of pharmaceutical development. He says the high price of drugs and shortages make it time to reexamine drug expiration dates in the commercial market.

“It’s a shame to throw away good drugs,” Hussain says.

The drugs kept in emergency crash carts at Newton-Wellesley Hospital, outside Boston, Massachusetts, often expire before they can be used and must be thrown away. (Erik Jacobs for ProPublica)

Some medical providers have pushed for a changed approach to drug expiration dates — with no success. In 2000, the American Medical Association, foretelling the current prescription drug crisis, adopted a resolution urging action. The shelf life of many drugs, it wrote, seems to be “considerably longer” than their expiration dates, leading to “unnecessary waste, higher pharmaceutical costs, and possibly reduced access to necessary drugs for some patients.”

Citing the federal government’s extension program, the AMA sent letters to the FDA, the U.S. Pharmacopeial Convention, which sets standards for drugs, and PhRMA asking for a re-examination of expiration dates.

No one remembers the details — just that the effort fell flat.

“Nothing happened, but we tried,” says rheumatologist Roy Altman, now 80, who helped write the AMA report. “I’m glad the subject is being brought up again. I think there’s considerable waste.”

At Newton-Wellesley Hospital, outside Boston, pharmacist David Berkowitz yearns for something to change.

On a recent weekday, Berkowitz sorted through bins and boxes of medication in a back hallway of the hospital’s pharmacy, peering at expiration dates. As the pharmacy’s assistant director, he carefully manages how the facility orders and dispenses drugs to patients. Running a pharmacy is like working in a restaurant because everything is perishable, he says, “but without the free food.”

Federal and state laws prohibit pharmacists from dispensing expired drugs and The Joint Commission, which accredits thousands of health care organizations, requires facilities to remove expired medication from their supply. So at Newton-Wellesley, outdated drugs are shunted to shelves in the back of the pharmacy and marked with a sign that says: “Do Not Dispense.” The piles grow for weeks until they are hauled away by a third-party company that has them destroyed. And then the bins fill again.

“I question the expiration dates on most of these drugs,” Berkowitz says.

One of the plastic boxes is piled with EpiPens — devices that automatically inject epinephrine to treat severe allergic reactions. They run almost $300 each. These are from emergency kits that are rarely used, which means they often expire. Berkowitz counts them, tossing each one with a clatter into a separate container, “… that’s 45, 46, 47 …” He finishes at 50. That’s almost $15,000 in wasted EpiPens alone.

Newton-Wellesley Hospital throws away about $200,000 in expired drugs each year. Studies have shown that many expired drugs are still potent and usable. (Erik Jacobs for ProPublica)

In May, Cantrell and Gerona published a study that examined 40 EpiPens and EpiPen Jrs., a smaller version, that had been expired for between one and 50 months. The devices had been donated by consumers, which meant they could have been stored in conditions that would cause them to break down, like a car’s glove box or a steamy bathroom. The EpiPens also contain liquid medicine, which tends to be less stable than solid medications.

Testing showed 24 of the 40 expired devices contained at least 90 percent of their stated amount of epinephrine, enough to be considered as potent as when they were made. All of them contained at least 80 percent of their labeled concentration of medication. The takeaway? Even EpiPens stored in less than ideal conditions may last longer than their labels say they do, and if there’s no other option, an expired EpiPen may be better than nothing, Cantrell says.

At Newton-Wellesley, Berkowitz keeps a spreadsheet of every outdated drug he throws away. The pharmacy sends what it can back for credit, but it doesn’t come close to replacing what the hospital paid.

Then there’s the added angst of tossing drugs that are in short supply. Berkowitz picks up a box of sodium bicarbonate, which is crucial for heart surgery and to treat certain overdoses. It’s being rationed because there’s so little available. He holds up a purple box of atropine, which gives patients a boost when they have low heart rates. It’s also in short supply. In the federal government’s stockpile, the expiration dates of both drugs have been extended, but they have to be thrown away by Berkowitz and other hospital pharmacists.

The 2006 FDA study of the extension program also said it pushed back the expiration date on lots of mannitol, a diuretic, for an average of five years. Berkowitz has to toss his out. Expired naloxone? The drug reverses narcotic overdoses in an emergency and is currently in wide use in the opioid epidemic. The FDA extended its use-by date for the stockpiled drugs, but Berkowitz has to trash it.

On rare occasions, a pharmaceutical company will extend the expiration dates of its own products because of shortages. That’s what happened in June, when the FDA posted extended expiration dates from Pfizer for batches of its injectable atropine, dextrose, epinephrine and sodium bicarbonate. The agency notice included the lot numbers of the batches being extended and added six months to a year to their expiration dates.

David Berkowitz, assistant director of the pharmacy at Newton-Wellesley Hospital, said he questions the validity of many drug expiration dates. (Erik Jacobs for ProPublica)

The news sent Berkowitz running to his expired drugs to see if any could be put back into his supply. His team rescued four boxes of the syringes from destruction, including 75 atropine, 15 dextrose, 164 epinephrine and 22 sodium bicarbonate. Total value: $7,500. In a blink, “expired” drugs that were in the trash heap were put back into the pharmacy supply.

Berkowitz says he appreciated Pfizer’s action, but feels it should be standard to make sure drugs that are still effective aren’t thrown away.

“The question is: Should the FDA be doing more stability testing?” Berkowitz says. “Could they come up with a safe and systematic way to cut down on the drugs being wasted in hospitals?”

Four scientists who worked on the FDA extension program told ProPublica something like that could work for drugs stored in hospital pharmacies, where conditions are carefully controlled.

Greg Burel, director of the CDC’s stockpile, says he worries that if drugmakers were forced to extend their expiration dates it could backfire, making it unprofitable to produce certain drugs and thereby reducing access or increasing prices.

The 2015 commentary in Mayo Clinic Proceedings, called “Extending Shelf Life Just Makes Sense,” also suggested that drugmakers could be required to set a preliminary expiration date and then update it after long-term testing. An independent organization could also do testing similar to that done by the FDA extension program, or data from the extension program could be applied to properly stored medications.

ProPublica asked the FDA whether it could expand its extension program, or something like it, to hospital pharmacies, where drugs are stored in stable conditions similar to the national stockpile.

“The Agency does not have a position on the concept you have proposed,” an official wrote back in an email.

Whatever the solution, the drug industry will need to be spurred in order to change, says Hussain, the former FDA scientist. “The FDA will have to take the lead for a solution to emerge,” he says. “We are throwing away products that are certainly stable, and we need to do something about it.”

Output: Hospitals and pharmacies are required to toss expired drugs, no matter how expensive or vital. Meanwhile, the FDA has long known that many remain safe and potent for years longer.


Instruction: create a high quality summary of the given input

Input:
Obamacare Exchanges In Limbo
 About Capitol Desk Capitol Desk delivers the latest in health care policy and politics from Sacramento and around the state. Have an idea? Let us know.

California’s Obamacare exchange scrubbed its annual rate announcement this week, the latest sign of how the ongoing political drama over the Affordable Care Act is roiling insurance markets nationwide.

Covered California might not wrap up negotiations with insurers and announce 2018 premiums for its 1.4 million customers until mid-August — about a month later than usual. Similar scenarios are playing out across the country as state officials and insurers demand clarity on health care rules and funding, with deadlines fast approaching for the start of open enrollment this fall.

“It’s insane,” said John Baackes, CEO of L.A. Care Health Plan, which has about 26,000 customers on the California exchange. “Here we are in the middle of July and we don’t even know what rules we will be operating under for open enrollment. It is not how you want to run a business.”

Consumers could face sharply higher premiums and fewer choices if more health insurers leave the insurance marketplaces due to lingering uncertainty. State and industry officials around the United States are concerned that the federal government could stop funding so-called cost-sharing subsidies that reduce out-of-pocket costs for low-income consumers. And they worry the Trump administration won’t enforce the individual mandate that requires people to purchase health coverage or pay a penalty.

The National Association of Insurance Commissioners has called on the Trump administration and Congress to fully fund the cost-sharing subsidies. And the insurance commissioners of Washington state and California have warned that premiums will rise without enforcement of the ACA’s coverage mandate.

Use Our Content This story can be republished for free ( details ).

Amid those concerns, there was a sense of relief Tuesday among many exchange officials and insurers after the U.S. Senate’s latest attempt to replace the Affordable Care Act failed.

Two large insurer trade groups bluntly warned last week that parts of the Senate plan were “unworkable” and could plunge the market into chaos. In a letter to the Senate, America’s Health Insurance Plans and the Blue Cross Blue Shield Association particularly objected to an amendment by Sen. Ted Cruz (R-Texas) that would have allowed insurers to sell bare-bones health plans to people who wanted cheaper premiums. That provision, the insurers said, would split the market between the healthy and the sick, driving up costs for people with preexisting conditions.

However, the Republicans’ failure to pass that ACA replacement plan did not resolve questions swirling around the current health law.

Tuesday, President Donald Trump expressed disappointment at the outcome in the Senate, telling reporters, “We’ll let Obamacare fail and then the Democrats are going to come to us and they’re going to say, ‘How do we fix it?’”

Some Senate Republicans struck a more conciliatory tone, suggesting that lawmakers should work on a bipartisan measure that would help stabilize the individual insurance markets.

Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Committee on Health, Education, Labor and Pensions, said he plans to hold hearings in the coming weeks on ways to shore up the individual insurance market. Lawmakers may look at creating a new stabilization fund that helps compensate insurers for higher-cost patients. Such a fund would be similar to one that existed during the first three years of the ACA exchanges.

Some insurance industry executives welcomed the talk of bipartisanship, but they said action must be taken quickly to resolve key issues affecting consumers.

“We are running out of time and we need a resolution on what we are charging for 2018,” said Gary Cohen, vice president of public affairs at Blue Shield of California in San Francisco, the largest Covered California insurer by enrollment.

Cohen, who helped launch the exchanges in 2014 as an official in the Obama administration, noted that the Republican bills in both the House and Senate included money for reinsurance that can help lower premiums industrywide. Those provisions are among the “immediate steps Congress and the Trump administration need to take in order for markets to provide coverage that is affordable.”

A federal reinsurance program helps compensate insurers for the high costs incurred by the sickest patients. That, in turn, allows health plans to keep their overall premiums lower and attract healthier customers into the insurance pool.

Lawmakers could also appropriate federal funds for the cost-sharing subsidies, which have a price tag of about $7 billion a year. Those payments, made directly to insurers, help reduce deductibles and other out-of-pocket costs for policyholders who earn up to 250 percent of the federal poverty level. This year, that’s up to about $29,000 for an individual or around $61,000 for a family of four. More than half of the people enrolled on exchanges nationwide qualify for this financial assistance.

Without it, many consumers would face annual deductibles of $2,000 or more when visiting the doctor or undergoing medical tests. That would make people far less likely to sign up with participating insurers.

Conservatives in Congress oppose the subsidies, calling them a bailout of the insurance industry and arguing that the Obama administration didn’t have the authority to pay them. Trump has repeatedly threatened to cut off those cost-sharing subsidies as well.

With their future up in the air, some states, including California and Pennsylvania, allowed insurers to submit two sets of proposed premiums. One filing reflects continued federal funding of those subsidies, and a separate one assumes they are eliminated and their cost is included in health plan premiums.

In Pennsylvania, premiums next year without the subsidies would increase by an average of 20 percent, compared with 9 percent if they remained intact.

Pennsylvania Insurance Commissioner Teresa Miller said the market in her state would be in good shape without the uncertainty over federal policy. “The only thing right now keeping everyone on edge is what’s going to happen in Washington, D.C.,” Miller said. “If things calm down in D.C. and if we don’t see further changes, then Pennsylvania’s market really is stabilizing.”

On Tuesday, Covered California said the two different rate filings its health plans submitted will be released Aug. 1. The exchange may announce that same day what the final premiums are, or it could postpone the decision for several more weeks if Congress has begun to pursue fixes to the ACA.

“This decision is based on the ongoing federal uncertainty around the repeal and replacement attempts of the Affordable Care Act and the dramatic potential impacts such uncertainty has on the rates and on California consumers,” the exchange said in a statement.

A recent analysis commissioned by Covered California estimated that premiums for silver-tier plans would jump by 16.6 percent if the federal government stopped paying for the cost-sharing subsidies. That would be in addition to normal increases meant to cover rising medical costs. An exchange spokeswoman declined to comment further Tuesday, citing the ongoing developments in Washington.

In the Florida exchange market, health insurers have sought an average rate increase of nearly 18 percent. But Florida Blue, the state’s largest health insurer, said those rates would go even higher if the cost-sharing reduction payments disappeared.

Robert Laszewski, an industry consultant in Virginia and a frequent ACA critic, said the exchange markets aren’t imploding, despite what the Trump administration has often said. But their premiums will continue to rise unless more young and healthy people are persuaded to buy coverage, he said.

“I think most insurance companies will at least break even, or even make a profit, in 2018,” Laszewski said. “Coverage will be ‘stable,’ but it will stabilize at a horrific premium rate level.”

Eric Whitney, Abe Aboraya and Ben Allen contributed to this story.

Output: California’s Obamacare exchange scrubbed its annual rate announcement this week, the latest sign of how the ongoing political drama over the Affordable Care Act is roiling insurance markets nationwide.


Instruction: create a high quality summary of the given input

Input:
Insurtech start-up Visicover teams with Allianz on plane coverage
 Allianz Global Corporate & Specialty (AGCS) announced it has formed a partnership agreement with insurtech company, Visicover.

Visicover’s existing and new aeroplane and helicopter insurance products now will be underwritten by AGCS, which also will provide claims management services.

Customers buy their aircraft insurance online with Visicover, which also enables them to self-administer their policies including renewals, said AGCS, which is Allianz Group’s corporate & specialty insurance business,

“The aviation industry is undergoing significant change. New technologies are impacting companies’ risks, creating new and eliminating old risks,” said Tom Chamberlain, AGCS’ underwriting manager for Aerospace and General Aviation.

This new partnership with Visicover aligns with Allianz’ strategy “to focus on new distribution channels for our products and, in particular, explore ways to enhance the customer journey in an increasingly digital world,” he added.

“Through working with Visicover, we will be part of the innovative drive to understand how new technologies and insurance propositions can benefit the customer and how they will develop in the future,” Chamberlain went on to say.

“The original vision for Visicover was to create a better solution based on simple flexible products, lower premiums and online self-servicing so that aircraft owners could manage their cover themselves,” said Jan Houlberg, managing director, Visicover.

“Since launching only four years ago, we’ve taken a significant share of the general aviation insurance market,” he noted. “Allianz is the ideal partner as we look to increase our presence and expand our offering in the aviation space and look to move into other markets.”

Visicover detailed key points about its service, which included:

Most eligible customers can get a quote and buy their policy in under 10 minutes.

Customers can pay their premiums in full or opt to pay a 30 percent deposit and spread the balance over eight monthly, interest free installments.

Customers only pay for the cover they want. Some insurers include “free” covers, but, in reality, the customer pays for them in their premiums whether they want them or not.

Customers are in control and can change their cover when they need to, 24 hours a day, 365 days a year, which removes the need to wait in a broker’s office or phoning a call center.

A 24-hour phone line is provided for claims notification and management queries.

Documents are saved online so customers can access them at any time and see their complete policy history.

Source: Allianz Global Corporate & Specialty (AGCS)

Topics Mergers & Acquisitions InsurTech Tech Aviation

Output: UK-based online aircraft insurance start-up Visicover has signed a partnership agreement with Allianz Global Corporate & Specialty (AGCS), as the four-year-old firm seeks to expand its presence in the aviation market. Tom Chamberlain, AGCS’s underwriting manager for aerospace and general aviation, said the deal allowed AGCS to "focus on new distribution channels for our products and, in particular, explore ways to enhance the customer journey".


Instruction: create a high quality summary of the given input

Input:
With Obamacare repeal off the table, will Republicans start trying to actually improve healthcare?
 Millions of Americans whose healthcare coverage was imperiled can breathe a sigh of relief now that congressional Republicans’ reckless efforts to dismantle the Affordable Care Act have foundered. They can thank a handful of courageous moderates in the Senate Republican Caucus for being unwilling to repeal the ACA without having a replacement ready that wouldn’t make matters worse for their constituents.

Merely stopping bad legislation, however, won’t solve the problems that helped to drive the “repeal and replace” effort this year. Major insurers have withdrawn from the individual market in several states, leaving some counties with no one to serve residents who don’t have coverage through their jobs, Medicare or Medicaid. And other counties are seeing staggering premium increases. At least some of these problems resulted directly from the crippling uncertainties created by Republican policymakers.

With characteristic graciousness, President Trump has now called on Congress to “let Obamacare fail,” something made only more likely by his ongoing efforts to sabotage it. Meanwhile, Senate Republican leaders say they’ll vote next week on the repeal bill, evidently for no better reason than to prove they can’t pass it. That’s a waste of time. The responsible thing to do would be to shore up the markets created by the ACA for individual policies. This needs to be done soon, given that insurers have to set their offerings and rates for 2018 within the next couple of months.

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The problems start with the uncertainty over who will sign up for coverage and how much it will cost — a situation that applies to states with robust individual markets, such as California, as well as to those with ailing ones, such as Iowa and Tennessee.

The Trump administration can’t continue to disregard the ACA’s mandate that adult Americans obtain insurance, at least not without an alternative way to persuade healthy people to sign up. Otherwise, insurers will have too few healthy people and too many costly ones in their risk pools. Congress and the administration also need to commit publicly to paying for the subsidies that the law requires insurers to provide to low-income consumers for out-of-pocket costs. The threats to the mandate and the subsidies have led some insurers to drop out of the market and others to seek larger rate hikes, further discouraging healthy consumers from buying insurance.

Those steps may not be enough to help some less populous states, where too much cost is being spread across too few people. Reviving the ACA’s reinsurance program for health insurers there would help hold down premiums.

There’s broad consensus within the industry about the need to make these moves. The problem is that Republicans have campaigned against some or even all of them. Now, however, they’ll have to put politics aside in order to spare the individual markets in their states the chaos they’ve set in motion.

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Output: Millions of Americans whose healthcare coverage was imperiled can breathe a sigh of relief now that congressional Republicans’ reckless efforts to dismantle the Affordable Care Act have foundered.


Instruction: create a high quality summary of the given input

Input:
Regulatory Decisions Inconsistent With High-Value Health Care System
 Despite a desire to transition the United States to a health system that rewards value over volume, which was evidenced in the bipartisan approach to the Medicare Access and CHIP Reauthorization Act, too many regulatory decisions on issues of reimbursement still encourage high-volume, hospital-based providers over independent community physician practices. As the public conversation remains acutely focused on legislative efforts to repeal and replace the Affordable Care Act, important policy and statutory changes must occur in order to prioritize truly site-neutral payments and transform the U.S. health care system into one that optimizes the value care model.

A notable example of this type of biased policy, which restricts free market competition while augmenting more expensive site-of-service care, is the Centers for Medicare & Medicaid Services’s approach to the Final Rule for the Medicare Hospital Outpatient Prospective Payment System and the Medicare ambulatory surgical center payment system.

Specifically, the Final Rule creates an interim policy that appears to contradict the language and purpose of Section 603 of the Bipartisan Budget Act of 2015, which equalizes Medicare reimbursement between off-campus hospital departments and other sites of service. Without certain revisions, CMS will have created an exemption so large that “the exemption will swallow the rule” and prevent the implementation of a site-neutral payment structure as Congress directed.

The Final Rule appears to remove all limitations on the services for which an off-campus provider-based department — essentially a freestanding facility or practice purchased by a hospital — may bill under the OPPS, even if these services are entirely different from the types of services the PBD provided prior to Nov. 2, 2015. That means the physician practice I used to compete against that sold out to a hospital is now able to expand its services and get paid more for the same services. How does this further the goals of developing a high-value health system that controls cost?

Within the last several months, the failings of the government’s approach to site-neutral payments were highlighted with the release of the Medicare Payment Advisory Commission’s March 2017 Report to Congress on Medicare Payment Policy. Although overshadowed at the time by the frenzy of the repeal and replace debate, the report is important because MedPAC once again reiterated the site-neutral payment recommendations it has stated repeatedly over the years, which are different than CMS’s Final Rule.

Written after the adoption of the OPPS rule, MedPAC clearly felt CMS still did not go far enough with site-neutral payments. As a physician leading an independent, specialty medical practice I cannot stress how critical it is for policymakers to look closer at the disparity between the goals for a high-value system and the reality of CMS’s final OPPS rule. Every day my colleagues and I offer quality, cost-efficient care that produces excellent patient outcomes. We do this while competing daily with hospitals’ aggressive expansion plans and purchase of independent physician practices and off-campus service providers that limit patient choice and increase costs. There is no reason hospitals should be paid more to deliver the same care.

For physicians within the Large Urology Group Practice Association, the creation of a truly site-neutral reimbursement system is the only way to achieve Congress’s goal of curbing the practice of hospital acquisition of physician practices — a practice that results in additional out-of-pocket costs for Medicare beneficiaries and greater expenses for the healthcare system as a whole.

My colleagues and I, who provide high-quality care in independent settings, are hopeful that the new administration will work to resolve the inconsistent implementation of regulations that govern how we transition to a high-value care system. This issue is too important to get pushed aside. America’s independent physician group practices stand ready to assist.

Neal Shore, MD, FACS, is the president of LUGPA, a trade association representing the independent urology group practices in the United States, and more than 2,200 physicians who make up more than 25 percent of the nation’s practicing urologists and provide more than 30 percent of the total urologic care in the U.S.

Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.

Output: Despite a desire to transition the United States to a health system that rewards value over volume, which was evidenced in the bipartisan approach to the Medicare Access and CHIP Reauthorization Act, too many regulatory decisions on issues of reimbursement still encourage high-volume, hospital-based providers over independent community physician practices.


Instruction: create a high quality summary of the given input

Input:
Self-perceptions of aging
 Credit: University of Michigan

In the 1960s, the Beatles sang about wondering whether their true love would still love them as they grew older—after they've lost their hair and are no more adventurous than wanting to knit a sweater.

A group of four studies led by University of Michigan researchers has found that however the hero of the Beatles song turns out, his health—and his wife's health—may be dictated by their perceptions of their own aging.

"Beliefs about one's own aging are shared within couples, and these beliefs are predictive of future health above and beyond individual beliefs," said Shannon Mejia, a postdoctoral fellow at U-M's Institute for Social Research. "Husbands' and wives' individual experiences of physical activity and disease burden are important for their current shared beliefs and future functional health."

That is, couples who tend to view their aging negatively tend to become less healthy and less mobile than couples who view their aging positively. In addition, husbands' disease burden shape their attitudes toward both their own aging and their wives' aging. Mejia and colleagues surmise that the husbands' limitations stemming from disease negatively affect the wives' health because of the increased burden of caregiving.

Jennifer Sun, an M.D./Ph.D. candidate at the U-M Medical School who conducted the research as a psychology doctoral candidate, found that a person's self-perception of aging affects whether he or she accesses health care in a timely fashion. She found that the more negatively a person viewed his or her aging, the more likely he or she was to delay seeking health care and the more barriers he or she saw for seeking care.

This association between negative self-perceptions of aging and health care delay persisted even after Sun controlled for problems that can delay health care, such as low socioeconomic status, lack of health insurance and multiple chronic health conditions.

"While many studies have focused on financial and structural barriers to care, it is also important to consider how psychosocial, emotional and cognitive factors are affecting the decisions of older adults to delay medical care," Sun said.

A third study authored by U-M doctoral candidate Hannah Giasson found that people who experience age discrimination feel less positive about their own aging.

A fourth study found that as people aged, their explicit bias toward older people—or how they would talk out loud about how they felt toward fellow older adults—improved as they aged. But their implicit bias—how they felt internally about fellow older adults—became more negative as they aged. Giasson and William Chopik, a Michigan State University researcher, led this study.

The papers are published today in a special supplement to the August issue of The Gerontologist.

"We're interested in the way people interpret their own lives," said Jacqui Smith, the principal investigator of a project on well-being in midlife and old age and second author on some of the published papers.

"We know that the images in the world and age stereotypes play a role in how people perceive their own aging. But subtle experiences of discrimination in interactions with strangers and sometimes with your own kids or partner—that is feedback that people take to heart and either rebel against it or begin to believe it."

The AARP supported the publishing of the supplement ahead of the annual meeting of the International Association of Gerontology and Geriatrics.

"Wherever these negative perceptions come from, the damage can be profound—for individuals, communities and larger populations," said AARP CEO Jo Ann Jenkins. "We need to change the conversation about age and aging in this country. It's not about being 'polite.' It's a necessity."

Output: In the 1960s, the Beatles sang about wondering whether their true love would still love them as they grew older—after they've lost their hair and are no more adventurous than wanting to knit a sweater. A group of four studies led by University of Michigan researchers has found that however, the hero of the Beatles song turns out, his health—and his wife's health—may be dictated by their perceptions of their own aging.