Today, the Medicare Payment Advisory Commission (MedPAC), an independent congressional agency that advises Congress on issues related to the Medicare program, will vote on draft recommendations related to Part B. Unfortunately, these recommendations include proposals that could give the Centers for Medicare and Medicaid Services (CMS) new authority to make one-size-fits-all value judgments based on flawed cost-effectiveness standards, and to come between doctors and patients in deciding which treatment option is best.
The three proposals up for vote this week are based on flawed assumptions and could threaten seniors’ access to medicines in Part B. We urge MedPAC to vote in opposition to them.
1. Using flawed standards to cap payment for Part B medicines with accelerated approval. One analysis looked at five medicines with accelerated approval and found their approval resulted in thousands or even millions of patients gaining earlier access with significant clinical benefits. Overlooking this clear benefit of accelerated approval, MedPAC is considering a proposal that would empower CMS to impose government price-setting for important new medicines with accelerated approval, potentially using flawed standards like QALY-based cost-effectiveness analysis. The end result is that Medicare beneficiaries will face access barriers and delays to new medicines, and continued innovation will be suppressed by government officials picking winners and losers.
2. Tying Part B reimbursement to flawed, centralized judgements of “clinical similarity.” MedPAC has proposed establishing a single payment rate for groups of medicines and biologics that are deemed by CMS officials to have “similar health effects.” This type of pricing scheme ignores the unique benefits of individual medicines and often relies of flawed standards for determining “value” and “clinical benefit.” It also overlooks significant differences in the needs of patients and their preferences, as well as the significant differences in the various medicines used to treat a disease. Forcing comparisons between medicines to determine reimbursement discourages innovation, which ultimately threatens the availability of future medicines. Recent research shows how often government officials get it wrong on judgments of clinical “similarity.”
3. Reducing physician reimbursement for Part B medicines. As part of the reimbursement structure for Part B medicines, physicians receive what is called an “add-on” payment to help cover the cost of storing medicines, shipping them to their offices and the ongoing patient monitoring that goes with treating patients with complex conditions. This add-on payment is a percentage of the Part B payment rate, which is often the average sales price, and plays an important role in helping physicians keep their doors open – especially in smaller and rural communities. Ignoring the importance of this payment and falsely assuming physician prescribing decisions are driven by the add-on payment, MedPAC is proposing to reduce it for some medicines and eliminate it all together for others. This would have a significant impact on physicians’ ability to provide Part B medicines to seniors.
These proposed changes to Medicare Part B could have a detrimental impact on access for patients who rely on Part B therapies. Learn more about the program at PhRMA.org/PartB.
Topics: Research and Development, Medicare, Part B, Accelerated Approval