President Trump and other administration officials have talked a big game about their new most favored nation model for lowering prices for Medicare Part B drugs, including cancer therapies and other potentially lifesaving treatments administered by physicians. But they failed to disclose the fine print: By their own estimates, nearly 10% of people covered by Medicare would lose access to treatment in the first year, and almost 20% by the end of the second year.
Here’s how this scheme would work: The Centers for Medicare and Medicaid Services Innovation Center would implement a mandatory nationwide “test” that would base on international drug prices how much hospitals, medical practices, and clinicians are reimbursed for using the top 50 Medicare Part B drugs.
(The irony of this move can’t be ignored: The administration is using the Innovation Center, which was created and funded by the Affordable Care Act, to conduct this experiment while simultaneously trying to kill the act in the Supreme Court.)
This dangerous experiment uses America’s seniors and providers as pawns to force drug companies to lower drug prices as the Trump administration heads out the door. It’s such a serious breach of faith with the millions of Americans covered by Medicare that the organization I lead, the Community Oncology Alliance, has sent a letter to the CMS administrator, Seema Verma, asking that the experiment be terminated immediately and filed an emergency lawsuit against CMS on Dec. 11 to stop this dangerous experiment from proceeding before it causes irreversible harm.
As CMS describes in its 257-page rule regarding the most favored nations approach, when reimbursement for these 50 drugs — 38 of which are used to treat cancer and blood diseases — are cut on Jan. 1, 2021, providers “will need to decide if the difference between the amount that Medicare will pay and the price they must pay to purchase the drugs would allow them to continue offering the drugs.”
That leaves seniors with the distressing “options” of traveling to one of the few facilities excluded from the experiment, finding a hospital that can take advantage of 340B drug discounts, or, as CMS says so blithely, “forgo access.” To take advantage of the first two options, cancer patients would have to sever ties with their oncologists and their practices and find new ones, even in the middle of treatment. The third option means the patient having “no access to treatment” or receiving a less-effective alternative drug for their cancer.
Make no mistake: If the most favored nations plan is allowed to proceed, it will have tragic and even deadly consequences. CMS is very clear in its estimates: 9% of Medicare beneficiaries will simply forgo access to treatment in the first year, increasing to 19% by 2023. Among the drugs that patients may “forgo access” to are some of the most cutting-edge immunotherapies, treatments that have had dramatic results in stopping the progression of cancer.
The president’s storyline that this experiment will dramatically reduce drug costs for seniors is simply false. People covered by Medicare pay only 20% of drug costs, with more than 94% having supplemental insurance or Medicaid to cover out-of-pocket obligations. Those without any coverage for their 20% coinsurance can obtain financial assistance from one of the foundations that community oncology practices tap into to ensure that no patients go without treatment, regardless of their means to pay for it.
Tackling the increasing cost of prescription drugs is a problem that needs to be desperately solved. The most favored nations approach isn’t the way to do it.
Real solutions lie in the 35 oncology payment reform models that community oncology practices are participating in across the country and the Oncology Care Model 2.0 that the Community Oncology Alliance is developing for Medicare, employers, and private insurers. We need to strip away regulations so drug competition is fostered in value-based arrangements, including the availability and use of lower-cost alternatives like biosimilars. The country also needs to reform the 340B program so drug discounts go directly to patients in need, not to well-endowed hospital health systems.
No model of care, even if on a limited basis, should ever endanger lives, as the most favored nations experiment does. In CMS’s own words, “While there are significant savings as a result of this model, a portion of the savings is attributable to beneficiaries not accessing their drugs through the Medicare benefit, along with the associated loss utilization.” Translation: Cancer patients won’t be able to get the drugs they need while the government saves money.
That makes the most favored nations approach a cruel and heartless experiment that will result in some Americans covered by Medicare “forgoing” treatment for cancer and other life-threatening condition, especially during the raging Covid-19 pandemic.
Ted Okon is the executive director of the Community Oncology Alliance.
In year the 2018 US citizens spent 365 billion dollars on drugs alone or 3 to 5 x what any other in the country in the world spent on drugs for the same ones. BIG Pharma controls laws via k street period
Obviously this scare article was not written by an actual healthcare provider. Anyone that is a Medicare contracted provider knows that the drug industry lobby, long ago, got congress to exempt them from competitive pricing which all other providers are subject to. This has caused a fiscal crisis in the Medicare program. Medicare can and does specify how much they will pay for every service they cover with the exception of drugs. The drug industry dictates to Medicare how much they will be paid. It is funny how the drug companies can afford to charge pennies on the dollar (or worse) for the same drug which they price gouge the US public. Is ok that Medicare subsidises lower drug prices for Canada, Mexico, France and other countries by paying higher domestic prices. This is effectively what is happening.
Totally agree. Plus the claim the public doesn’t pay for most of the drug cost because the govt or insurance company picks up the tab is pure nonsense. Ultimately the American public pays the cost through taxation or insurance premiums.
Then I guess everyone on Medicare is not going to be able to care for themselves, because the government wants more money. I rely on Medicare to finish my cancer treatments plus various other problems I have. There is no hope
You’re blaming the wrong entity. It’s the so called “free market” (which is actually a RIGGED market, rigged by big pharma and their $1M/year lobbyists) Big Pharma who refuse to behave like capitalists…which means willingness to negotiate. This article is full of half truths, at best.
The 50 drugs also include several drugs frequently used to treat rheumatoid arthritis, lupus, Crohn’s and other autoimmune/inflammatory diseases. This is terrible news for cancer patients but it also means that many thousands of others will have their lives seriously changed,too. Many will not be able to function and will become even more dependent on government disability programs. The fact that the drug restrictions were announced just 35 days before scheduled implementation is shocking. That fact alone should be enough to halt the program until a more realistic review takes place. If this program stands affected patients need a far longer time frame to find alternate treatments, if any are out there, before losing access to their current treatments.
If one of the government disability programs you’re talking about is Social Security disability insurance–Medicare is the health care coverage program that SSDI benefit recipients become entitled to—- 29 months after the date a disabled person is able to prove he/she met SSA’s criteria for disability. Only exceptions are people w/end stage (Stage 4) renal disease or ALS, they don’t have to wait for Medicare coverage. People who were able to work very little or not at all, who have very low (other) income and resources (resources are cash, or items that can be sold for cash to pay for shelter & food) and are disabled or over 65 may qualify for Medicaid coverage. What Medicaid covers is, to some extent, dependent on what each state agrees to cover-since states contribute part of the funding for Medicaid. Other then some tribal programs, I’m not sure what other “government disability programs” you’re referring to. Unless you mean VA health care benefits or retired military health care benefits and despite the pretty much constant military actions the US has been engaged in for 50 years, there are still not that many people who can get their health care through the VA hospitals and clinics.
Everything the Republicans touch hurts every day Americans.
I quess us old folks are expendable in their eyes.
They talk a good game but in truth they’re just heartless and cruel.
I worked for most of my 82 years and now when I need medicare help they are talking about less help
This reads like, Survival of the Fittest. The strongest determines the terms that favor their own survival. The selfishness and cruelty of government is suttle never goes away.
I am trying to determine how this is different than what happens now. My friend was denied a cancer drug because Medicare would not cover it. That was at the beginning of the year. She has since died.
Is there a letter drafted so that we can send it to our elected officials demanding that they put a STOP to this.
This is the real “death squad” or “killing of grandma” which the GOP concocted as fallacious campaign slogans to oppose Obama and the ACA. Now it will exist as their creation.
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