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Part B proposal too limiting, costly for patients and doctors, advocates tell House committee

Physicians do not base their treatment decisions on cost, physicians told a House Energy and Commerce Committee Tuesday.

Susan Morse, Managing Editor

“I am disappointed that CMS has masked their efforts to control rising drug costs by suggesting physicians are not providing their patients with the most appropriate, highest quality medical care but instead prescribe more expensive drugs for ‘profit,’” said Debra Patt, MD.“I am disappointed that CMS has masked their efforts to control rising drug costs by suggesting physicians are not providing their patients with the most appropriate, highest quality medical care but instead prescribe more expensive drugs for ‘profit,’” said Debra Patt, MD.

Proposed Medicare Part B drug payment models threaten medical practices and patients who are already financially strained due to the price of needed treatment, physicians told a House Energy and Commerce Committee Tuesday.

Oncologists especially feel the threat of lower proposed reimbursements as the cost of cancer drugs is higher, they said.

The Centers for Medicare and Medicaid is proposing two demonstration models that lower reimbursement rates and promote the use the generic drugs over more expensive therapy.

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Joe Baker, president of the Medicare Rights Center, said the model is continuing CMS's move to value-based reimbursement.

[Also: Medicare paid out $91 billion in Part B in 2014, just-released data show]

Marcia Boyle, a patient and president and founder of the Immune Deficiency Foundation said she saw value as masquerading as cost cutting.

"I'm convinced it will reduce quality and access for patients," Boyle said.

Committee Chairman Joseph Pitts, R-Pennsylvania, asked doctors and others who attended the hearing how the new model would affect their practices.

All said that the new models had the potential to limit access for patients.

Physicians do not base their treatment decisions on cost, they said.

[Also: Opponents of CMS Medicare Part B proposal call plan 'perverse' and 'dangerous']

"I am disappointed that CMS has masked their efforts to control rising drug costs by suggesting physicians are not providing their patients with the most appropriate, highest quality medical care but instead prescribe more expensive drugs for 'profit,'" said Debra Patt, MD. "CMS is absolutely incorrect in its assumptions that reducing reimbursements for Part B drugs will both lower Medicare costs and drug prices."

Former president Jimmy Carter would not have had access to the innovative treatment for the cancer that spread to his brain had the Centers for Medicare and Medicaid's new Medicare Part B model for drugs been in effect, Patt told the House Energy and Commerce Committee.

Carter's treatment for metastatic cancer, announced as in remission this March, was from new medication that trains the immune system to fight cancer tumors.

These types of innovative drugs are costly and many new products don't have generic alternatives, said Patt, who is vice president of Texas Oncology and medical director of the U.S. Oncology Network.

CMS wants to modify the average sales price add-on amount for Medicare Part B that covers drugs administered in a physician's office or hospital outpatient department.

In Phase I, CMS would study Part B drug payments under the current payment methodology of the average sales price plus 6 percent; and  under a second demonstration it would study a reduced add-on payment of the average sales price plus 2.5 percent, plus a flat fee of $16.80, according to Michael Schweitz, MD, national advocacy chair of the Coalition of State Rheumatology Organizations.

[Also: Healthcare, patient groups speak out against Medicare Part B proposal]

In Phase II, CMS would add value-based purchasing tools currently used by commercial health plans, pharmacy benefit managers and hospitals.

Phase I would begin this summer. Phase II could begin as soon as January 1, 2017.

"As CMS acknowledges in the rule, the proposed approach 'does not directly address the manufacturer's ASP, which is a more significant driver of drug expenditures than the add-on payment amount for Part B drugs.' Given that a slash to the ASP add-on is unlikely to actually lower costs for patients ... and may jeopardize access, we have requested that CMS withdraw the model and we urge the Committee to do the same," Schweitz said.  "A reduction from 6 percent to 2.5 percent plus a $16.80 flat fee will result in unsustainable cuts, especially considering that CMS did not incorporate the impact of sequestration in its calculations."

Patient and advocate Heather Block, who was diagnosed with stage 4 breast cancer, is living beyond projections, she said, but she has gone through most of her savings, paying 20 percent Medicare copay for her cancer drugs.

Block applauded CMS's efforts, though the new models may not change her 20 percent copay.

"It is measured and fair, and it's a way for the government to begin to shift pricing practices incrementally, based on what they learn," Block said. "By evaluating payment models over a five year period, CMS can determine the best practices without forcing me to change doctors, hospitals or affecting my drug coverage."

Also supporting CMS is the AARP and other groups, which on May 2 sent a letter to Health and Human Services Secretary Sylvia Burwell and CMS Acting Administrator Andy Slavitt.

"Beneficiary cost-sharing under fee-for-service Medicare Part B is 20 percent with no out-of-pocket limit, leading some older adults and people with disabilities to face catastrophic expenses, amounting to as much as $100,000 per year," the letter says. "We share CMS's concern that Medicare Part B reimbursement for prescription drugs may inadvertently encourage the use of more expensive drugs."

Twitter: @SusanJMorse