Medi­care Ad­van­tage may add re­stric­tions on drugs

Austin American-Statesman - - MORE OF TODAY’S TOP NEWS - By Su­san Jaffe Kaiser Health News

Start­ing next year, Medi­care Ad­van­tage plans will be able to add re­stric­tions on ex­pen­sive, in­jectable drugs ad­min­is­tered by doc­tors to treat can­cer, rheuma­toid arthri­tis, mac­u­lar de­gen­er­a­tion and other se­ri­ous dis­eases.

Un­der the new rules, th­ese pri­vate Medi­care in­sur­ance plans could re­quire pa­tients to try cheaper drugs first. If those are not ef­fec­tive, the pa­tients could re­ceive the more ex­pen­sive med­i­ca­tion pre­scribed by their doc­tors.

In­sur­ers use such “step ther­apy” to con­trol drug costs in the em­ployer-based in­sur­ance mar­ket as well as in Medi­care’s stand-alone Part D pre­scrip­tion drug bene- fit, which gen­er­ally cov­ers medicine pur­chased at re­tail phar­ma­cies or through the mail. The new op­tion al­lows Ad­van­tage plans, an al­ter- na­tive to tra­di­tional, gov­ern­ment-run Medi­care, to ex­tend that cost-con­trol strat­egy to th­ese physi­cian-ad­min­is­tered drugs.

In tra­di­tional Medi­care, which cov­ers 40 mil­lion older or dis­abled adults, those med­i­ca­tions given by doc­tors are cov­ered un­der Medi- care Part B, which in­cludes out­pa­tient ser­vices, and step ther­apy is not al­lowed.

About 20 mil­lion peo­ple have pri­vate Medi­care Ad­van­tage poli­cies, which in­clude cov­er­age for Part D and Part B med­i­ca­tions. Some physi­cians and pa­tient advo- cates are con­cerned that the pur­suit of lower Part B drug prices could en­dan­ger very sick Medi­care Ad­van­tage pa­tients if they can’t be treated promptly with the medicine that was their doc­tor’s first choice.

Crit­ics of the new pol­icy, part of the ad­min­is­tra- tion’s ef­forts to ful­fill Pres­i­dent Don­ald Trump’s prom- ise to cut drug prices, say it lacks cru­cial de­tails, in­clud- ing how to de­ter­mine when a less ex­pen­sive drug isn’t ef­fec­tive.

“Do you have to lose vi­sion be­fore you are al­lowed to use” med­i­ca­tion ap­proved by the Food and Drug Ad­min- is­tra­tion? asked Richard O’Neal, vice pres­i­dent for mar­ket ac­cess for Re­gen­eron, which makes Eylea, a medicine that is in­jected into the eye to treat macu- lar de­gen­er­a­tion. In 2016, Medi­care paid $2.2 bil­lion for Eylea pre­scrip­tions for pa­tients in tra­di­tional Medi­care, more than any other Part B drug, ac­cord­ing to gov­ern­ment data.

Medi­care Ad­van­tage in­sur­ers spend about $12 bil­lion on Part B drugs, com­pared to the $25.7 bil­lion tra­di­tional Medi­care spent in 2016 on such drugs. In­sur­ers that adopt the step ther­apy pol­icy can ap­ply it only to new pre­scrip­tions — medicine a pa­tient hasn’t re­ceived in the past 108 days.

The change in pol­icy gives in­sur­ers a new bar- gain­ing tool: Phar­ma­ceu­ti­cal mak­ers may want to com­pete by cut­ting prices to get their prod­uct on the plans’ list of pre­ferred lists, al­low­ing pa­tients to re­ceive the medicines with­out step ther­apy pre-con­di­tions. That “strength­ens their ne­go­ti­at­ing po­si­tion with the man- ufac­tur­ers,” Medi­care chief Seema Verma said when she un­veiled the pol­icy last month. It could also save pa­tients money since they usu­ally pay a por­tion of the Part B pre­scrip­tion cost. In ad­di­tion, Medi­care is re­quir­ing plans to share the sav­ings with en­rollees.

“Com­pe­ti­tion is a big fac- tor in price con­ces­sions,” said Daniel Nam, ex­ec­u­tive direc­tor of fed­eral pro­grams at Amer­ica’s Health In­sur- ance Plans, an in­dus­try trade group. But in­sur­ers haven’t had much lever­age to nego- tiate lower prices for th­ese drugs with­out strate­gies like step ther­apy, he said.

Fed­eral health of­fi­cials told in­sur­ers in a memo last month that they could sub­sti­tute a less ex­pen­sive Part B drug to treat a med­i­cal con­di­tion the FDA has not ap­proved it for, if in­sur- ers can doc­u­ment that it is safe and ef­fec­tive. Yet cov­er­age for a Part D drug is usu­ally de­nied for a con­di­tion that doesn’t have FDA ap­proval, ac­cord­ing to the Cen­ter for Medi­care Advo- cacy, which helps ben­e­fi­cia­ries with ap­peals.

Rep­re­sen­ta­tives of medi- cal spe­cialty groups re­cently met with Alex Azar, the sec- re­tary of the Depart­ment of Health and Hu­man Ser­vices, to ex­press their con­cerns. Dr. Stephen Grubbs, vice pres­i­dent of clin­i­cal af­fairs at the Amer­i­can So­ci­ety of Clin­i­cal On­col­ogy said Azar told them the new pol­icy would not have a big im­pact on can­cer treat­ment.

Pa­tients and their physi­cians who en­counter prob- lems get­ting spe­cific Part B drugs can ap­peal us­ing the “pro­cess that we have through­out the Medi­care Ad­van­tage pro­gram and Part D plans,” ad­vised Verma.

Sec­re­tary of Health and Hu­man Ser­vices Alex Azar met re­cently with rep­re­sen­ta­tives of med­i­cal spe­cialty groups.

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