Medicare Compliance & Reimbursement

Could prior studies have already proven opposite results?

Oncologist organizations have been especially vocal in their dissent concerning the recent proposed rule to makeover the way Medicare Part B pays for prescription drugs provided in physician offices and hospital outpatient departments. The reason, in part, is due to the high prevalence of oncology-related and expensive drugs paid under Part B.

“Medicare beneficiaries comprise 60 percent of the 14 million Americans living with cancer, and the elderly are 10 times more likely to get cancer than the younger population,” stated a Feb. 25 letter from the American Society of Clinical Oncology (ASCO) to Centers for Medicare & Medicaid Services (CMS) Acting Administrator Andy Slavitt. “We are deeply concerned this risky, unproven experiment to Medicare Part B drug payments will jeopardize the health of millions of Medicare patients with cancer.”

“We strongly oppose any effort to rush through a cost-cutting program that will affect patients’ access to life-saving Medicare Part B covered drugs,” the ASCO added, echoing sentiments in a March 9 letter to Slavitt and HHS Secretary Sylvia Burwell from the Community Oncology Alliance (COA).

CMS’ concern that the current 6-percent add-on to the average sales price (ASP) could create incentives to use higher-priced drugs “fails to acknowledge providers’ prescribing decisions depend on a variety of factors, including clinical considerations that may influence a provider’s choice among therapeutic alternatives, especially as it relates to cancer,” the ASCO said. The ASCO also claimed that there is no evidence that the proposed Part B payment changes will improve care quality or even reduce spending.

Case in point: The ASCO highlighted a recent UnitedHealthcare project designed to eliminate any such incentives within community oncology practices. The project appeared to prove the opposite of CMS’ assumption — the study found that “eliminating existing financial chemotherapy drug incentives paradoxically increased the use of chemotherapy.”

Also, the COA letter bemoaned two previous cuts to cancer drugs — when CMS incorrectly interpreted the MMA and mandated that drug manufacturers include “prompt pay” discounts provided to drug wholesalers in the calculation of the ASP, as well as when CMS applied the 2-percent sequester cut to Medicare drug reimbursement. These previous cuts to Part B drug reimbursement, along with the current proposed reduction, “would effectively result in drug reimbursement below ASP,” COA said.

Trend: Both the ASCO and COA point to these pay cuts as the cause of the consolidation of cancer care in the United States, pushing the oncology care model into the more expensive hospital setting. You can read the ASCO letter at www.asco.org/sites/www.asco.org/files/oncology_asp_letter.pdf and the COA letter at http://blog2.communityoncology.org/userfiles/76/COA_CMS_ASPExperimentLetter_3-9-16_FINALR.pdf.