Medicare Monday: Stakeholders raise concern with MedPAC’s proposed changes to drug purchasing program

Nicole Longo   |     April 24, 2017   |   SHARE THIS


A couple weeks ago, we looked at what a broad group of stakeholders have said about the recommended changes to Part B that the Medicare Payment Advisory Commission (MedPAC) voted in support of. But this week, we wanted to examine one proposed change a bit more.

MedPAC has proposed creating the “drug value program,” essentially a redesign of the competitive acquisition program that the Centers for Medicare & Medicaid Services piloted in Part B from 2006 to 2008. MedPAC offered this proposal in an attempt to make Part B more competitive. But this proposal includes several elements that would actually impede a competitive market, including a binding arbitration process to set prices for new drugs, government price controls and, for the first time, imposing access restrictions for patients.

A number of groups have called attention to the dangers of this proposal in particular. In a letter to MedPAC, nearly 200 patient and provider groups said “the MedPAC proposal to create a new ‘Drug Value Program’ leaves a number of critical questions unanswered, and as proposed could harm patient access by imposing new restrictions on Part B therapies.”

The Community Oncology Alliance points out, “There are numerous problems with the Part B Drug Value Program (DVP) outlined in the MedPAC draft recommendations [… ] the idea of creating a formulary to artificially induce competition in price negotiations, administered by a third party PBM-type entity, is simply reckless. This would create obstacles to Medicare beneficiaries receiving the most appropriate cancer therapy available as decided by the physician and patient – not some corporate, profit-seeking PBM-type entity.”

Additionally, Amy Bricker, a MedPAC commissioner and vice president of supply chain strategy & product development at Express Scripts, raised concerns with the “drug value program” proposal, telling Modern Healthcare, “For me, it’s a bridge too far [ … ] There is a way for us, I believe, to foster competition, to bring value to the market without adopting something as drastic as this.”

Stakeholders from across the health care sector agree: MedPAC’s proposal would make Part B less market based and reduce access to treatment for beneficiaries with serious conditions.   

Nicole Longo

Nicole Longo Nicole is senior director of public affairs at PhRMA focusing on Medicare, 340B, importation and more. She previously worked for a D.C.-based public affairs firm where she assisted a wide range of clients with communications efforts on everything from trade policy to agriculture policy to health care policy. Outside the office, Nicole can be found trying new restaurants (usually Italian), taking an occasional barre class and cheering on the Cincinnati Bengals.

Topics: Medicare, Medicare Monday, Part B

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