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Cancer Care Groups Vocalize Opposition to Medicare Drug Payment Proposal

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   March 21, 2016

Oncologists have been the most vocal group opposing CMS's proposal to restructure Part B drug reimbursement because they believe patients have the most to lose—namely access to care.

The backlash against a new Medicare proposal that reduces physician reimbursement for Part B drugs has been swift. Several strongly worded letters were sent to the Centers for Medicare & Medicaid Services protesting the change, including one from more than 60 cancer care groups that represent nearly every state in the country.

Zon has held several leadership positions with American Society of Clinical Oncology (ASCO), one of many cancer organizations that believe restructuring Part B reimbursement from ASP plus 6% to a flat fee of $16.80 plus 2.5% will reduce patient access to cancer care.

Reimbursement Affects Patient Access

National Patient Advocate Foundation CEO Alan Balch, PhD, says the proposal will hit Medicare patients in rural areas. "Most cancer patients are still getting care in a community setting, especially in rural areas," he says. "Cutting reimbursement may mean providers won't take Medicare or they'll sell [their practice] to a hospital, which pushes patients to a setting that is further away."

Transportation is a major concern for the more than 20,000 patients NPAF helps annually, 50% of which are Medicare beneficiaries. Cancer care at a hospital is also more expensive. A Community Oncology Alliance study in 2012 on cost of cancer care by site showed that the cost of chemotherapy treatment in a hospital-owned outpatient office was 34% higher when compared to the same treatment in an independent oncology practice. 

Vice President of Texas Oncology, Debra Pratt, MD, says she is equally concerned about the potential impact on cancer patients in rural areas. Texas Oncology has more than 165 community-based cancer clinics in Texas and Oklahoma, some are in rural areas. Pratt calls the CMS proposal a "blunt instrument" with no consideration of oncologists and the cancer community.

"The natural consequences of this will be that Medicare patients will not have access, there will be further hospitalization, and increases to the cost of care," Pratt says.

The CMS proposal to change Part B drug reimbursement is described by the agency as budget-neutral. Some critics have charged that the current reimbursement model gives physicians an incentive to choose drugs with higher costs. But Zon says most oncologists are following clinical care pathways to do what's best for their patients. Plus, she says, the current model doesn't pay enough now.

"We are already in a situation where Medicare was not keeping up with the cost of drugs," Zon says. "ASP plus 6% was never updated quickly enough for physicians, and the sequester (2%) really made it ASP plus 4%. It's some desperate attempt to try and control drug costs. The problem is we have done nothing to cause the cost of drugs to escalate."

Independent oncologists also say there isn't a level playing field between them and hospitals. "[Hospitals] have bigger discounts on drugs," Pratt says.

The debate over drug costs is at a near-tipping point. Two studies out this month point to double-digit cost increases and billions of dollars wasted. The costs impact Medicare beneficiaries, too. Zon's practice has hired financial counselors to help patients figure out how to afford treatment. "It's taking a personal toll on them," Zon says. "Patients are coming in crying."

Jacqueline Fellows is a contributing writer at HealthLeaders Media.

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