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Old 10-09-2007, 05:35 PM
gdpawel gdpawel is offline
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Default Study: Medicare Modernization Act Did Not Change Chemotherapy as Feared

Medicare Modernization Act Did Not Change Chemotherapy As Feared

DURHAM, N.C. -- Cancer patients receiving chemotherapy have not noticed a restriction in their access to treatment following the enactment of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA), despite the act's significant reduction in government reimbursement to oncologists, according to a new study led by researchers in the Duke Clinical Research Institute (DCRI).

"Critics of the MMA often said that it would reduce patients' access to chemotherapy services, because doctors would receive 30 to 40 percent less reimbursement from the government for administering treatment," said Kevin Schulman, M.D., director of the DCRI's Center for Clinical and Genetic Economics, and senior investigator on the study. "Our study showed that patients actually do not perceive barriers to their access to chemotherapy and perceptions about access are really the same among patients who received treatment before the legislation went into effect, and those who received it afterwards."

The team's findings will be published in the November 15, 2007 print edition of the journal Cancer, but also will appear earlier in the journal's October 8, 2007 online edition. The study was funded by a grant from the National Patient Advocate Foundation's Global Access Project, which brings together 42 national healthcare stakeholder groups -- such as pharmaceutical companies and advocacy groups -- to fund health research projects. The Project has focused on examining the MMA's consequences for patients, providers and healthcare systems.

The Duke researchers examined the results of 1421 surveys completed via the internet by 684 patients who had received chemotherapy prior to the enactment of the MMA and 737 patients who were treated after it went into effect. Respondents answered questions related to issues including the amount of time they waited to start chemotherapy after their initial cancer diagnosis, and how far they had to travel to get their treatments.

"When the act was passed in 2003, many doctors and patient advocates were concerned about the consolidation of services it might necessitate, such as the moving of chemotherapy services to hospital rather than outpatient settings and the elimination of staff positions," said Joelle Friedman, a DCRI researcher and lead author on the paper. "They were afraid these changes would affect patients' access to care, but our study showed that these concerns turned out to be largely unwarranted."

About half of the patients surveyed in each group were under the age of 65 and half were over 65. The majority of patients in each group reported being either satisfied or very satisfied with the care they received from their oncologists, Friedman said.

The researchers also found no difference in the amount of time from diagnosis to initiation of chemotherapy between the two groups; the median lapse in time was 22 days in both groups, Friedman said.

Patients reported an average travel time of 30 minutes to the location of their chemotherapy appointments, both before and after the implementation of the act, she said.

The speculation that treatment location would change -- that patients would either be forced to travel farther for therapy or switch treatment locations in the middle of therapy -- also proved to be unfounded, Friedman said.

The MMA represented the largest overhaul of the Medicare system since it was created in 1965. Changes included a new prescription drug benefit, and a $25 billion allocation of funds to rural hospitals. One key provision, however, was a significant reduction in Medicare reimbursement to healthcare providers. Oncologists were strongly affected, due to a perception that they had been over-compensated in the past.

Other researchers involved with this study were Lesley Curtis, Bradley Hammill, Jatinder Dhillon, Charles Weaver, Sugata Biswas and Amy Abernethy.

[url]http://www.dukemednews.org/news/article.php?id=10148

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Old 10-09-2007, 05:36 PM
gdpawel gdpawel is offline
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Default Medicare modernization act did not change chemotherapy as feared

Granted, the new Medicare D program was filled with lots of holes. The biggest problem was in designing the program. This administration did not want the Medicare drug benefit to be administered directly by the federal government (where Medicare is run efficiently). Instead, it devised a public program run by hundreds of competing private plans, each with its own prices and coverage policies.

Also, a joint Michigan/Harvard study confirmed, before the new Medicare reform, medical oncologists were more likely to choose cancer drugs that earn them more money. Yet a survey published in "Patterns of Care" showed that the Medicare reforms have not solved the problem of variations in oncology practice.

However, the new Medicare drug benefit plan was part of a much broader message. With oncology drugs accounting for about 69% of total Part B spending on prescription drugs and related services, the new Medicare D plan made it more important for Senior cancer patients.

A study published in the journal Health Affairs discovered that Part D expanded access to cancer therapies and required only low co-payments. Researchers found that the most commonly prescribed cancer drugs were available and when a brand-name drug was not covered, its generic equivalent was.

Apparently Medicare has gone far in accomplishing the task of making many cancer drugs available to our Seniors. Nearly all generic cancer drugs and 70% of brand-name cancer drugs are covered by the Part D plans. Most of the brand-name drugs not covered had generic equivalents that are covered. Also, a number of trusted old generic agents have been found to be just as effacious as the more expensive brand name ones.

According to NCI's official cancer information website on "state of the art" chemotherapy, no data support the superiority of any particular regimen. So, it would appear that published reports of clinical trials provide precious little in the way of guidance. There are many cancer drug regimens, all of which have approximately the same probability of working. The tumors of different patients have different responses to chemotherapy.

Medical oncologists are now be reimbursed for providing evaluation and management services, making referrals for diagnostic testing, radiaiton therapy, surgery and other procedures as necessary, and offer any other support needed to reduce patient morbidity and extend patient survival. In other words, medical oncologists were taken out of the retail pharmacy business. However, as Medicare tried to do this, private insurance plans still go along with the chemotherapy concession.

According to an article published in the New England Journal of Medicine, an unintended effect of the Medicare Part D benefit could be the creation of the world's most valuable resource for understanding how drugs are used, especially by the elderly and the chronically ill, and their risks and benefits.

[url]http://content.nejm.org/cgi/content/full/353/26/2742

Now, if only Medicare would be allowed to negotiate prices, eliminate the doughnut hole, and stop subsidizing private insurance Medicare plans!

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Old 11-02-2007, 03:23 PM
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Default Millions Saved and Patient Quality Still the Same

(Ivanhoe Newswire) -- Cuts in reimbursement for cancer care in 2003 have not affected the care of patients, at least not from the patients perception, according to a new study. The research reveals patients remain highly satisfied with their cancer treatments.

In 2003, the Medicare Prescription Drug, Improvement and Modernization Act (MMA) was signed into law by President Bush. It was the most comprehensive restructuring of the Medicare system since it began in 1965. One of the changes included reductions in Medicare reimbursement to health care cancer providers, which went into effect in 2005. Some pointed out this would require patients to travel further for treatment because cancer centers would have to downsize with less money.

Researchers from Duke Clinical Research Institute conducted a web-based survey interviewing patients before and after MMA went into effect. The research included 1,421 cancer patients with 684 treated before MMA and 737 treated after MMA. Study authors wanted to compare the patients perceptions of access to and satisfaction with their oncologists care.

Overall, there was no significant difference between the two groups. Both groups reported an average of 21 days for treatment to begin and an average travel time of 30 minutes. Both groups also reported being very satisfied with their medical care. While authors say this study does not support the generalizations that patients are being affected by the MMA changes, they add further examination of rural areas and those where only Medicare insurance is needed.

SOURCE: CANCER, published online October 8, 2007

The Medicare Modernization Act changed how the CMS pays for doctor-administered drugs to a system based on doctors' costs for the drugs from one based on average wholesale price. The government wasn't reducing payment for cancer care, it was simply reducing overpayment for cancer drugs. The government can't afford to overpay for these drugs in an era which they are fantastically expensive.

Medical oncologists are now reimbursed for providing evaluation and management services, making referrals for diagnostic testing, radiation therapy, surgery and other procedures as necessary, and offer any other support needed to reduce patient morbidity and extend patient survival.

The fact that medical oncologists received no reimbursement for providing oral-dose therapy to patients had been the principal barrier to the availability of oral-dose protocol. The advent of oral agents ultimately means that medical oncology will need to change its identity, prior to the chemotherapy concession. However, while Medicare tried to remove the profit incentive from the choice of cancer treatment, private payors still go along with it.

The new legislation started the process of providing access to a "full range" of the latest cancer-related prescription drugs to enhance the quality and standard of treatment for cancer. Medicare recipients were being relagated to treating their diseases with older, more toxic infusional chemotherapy agents at a time when new and more promising cancer drugs were reaching the market.

Compared to infusional therapy, oral-dose anti-cancer drugs can make receiving cancer treatment more convenient for patients by allowing flexibility in taking medication without disrupting work or other activities. They can often result in less time (or no time) spent in office-based oncology practices because of the absence of intravenous administration and its related side-effects.

The new "targeted" cancer therapies gave doctors a better way to tailor cancer treatment. There are a multiple of different cancer drug regimens, all of which have approximately the same probability of working. Treatments may be individualized based on the unique set of molecular targets produced by the patient's tumor, and these important treatment advances will require personalizing treatment based on testing the biological profiles of each patient's cancer.

What was needed, was to remove the profit incentive from the choice of cancer treatments, which were financial incentives for infusion therapy over oral therapy or non-chemotherapy, and financial incentives for choosing some drugs over others. Patients should receive what is best for them and not what is best for their oncologists.

The new system is clearly an improvement from the standpoint of cancer patients, taxpayers, and advocates of basing drug selection on individual tumor biology, rather than on a least common denominator approach which invites "conflict-of-interest medical decision-making." But again, private payors still go along with the concession.
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Old 07-09-2008, 01:04 AM
gdpawel gdpawel is offline
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Default Cancer Care Unaffected by Doctor Reimbursement Changes

Chemotherapy patients have not lost access to care despite federal legislation that has reduced reimbursements to their doctors in recent years, a new report finds.

Critics feared the passing of the Medicare Modernization Act of 2003 would make treatment more difficult, but investigators from the Duke Clinical Research Institute (DCRI) found little difference in the distance chemo patients traveled to be treated and the time between diagnosis and start of treatment.

"The Medicare Modernization Act took issue with the fact that oncologists were often reimbursed too much -- sometimes as much as three times what they had paid -- for the chemotherapy drugs they were giving their patients, and subsequently, doctors saw those reimbursement payments fall," senior study investigator Dr. Kevin Schulman, director of the DCRI's Center for Clinical and Genetic Economics, said in a prepared statement. "The concern was that patient care would suffer if doctors had to close their practices or scale back, making it necessary for patients to travel farther or go to inpatient facilities for treatment. Our study showed that this, in fact, has not yet occurred."

The researchers studied the treatment of people with leukemia, lymphoma, breast, lung or colorectal cancer from across the United States from 2003, before the act passed, through 2006.

"The distance patients traveled for chemotherapy treatments did not considerably increase after passage of the act," lead investigator Lesley Curtis, a health services researcher in the DCRI, said in a prepared statement. "And despite concerns that patients would have to go to inpatient settings with longer wait times to be treated, we observed a small shift in the provision of initial chemotherapy from inpatient to outpatient settings between 2003 and 2006."

The median amount of time between diagnosis and chemotherapy was 28 days and did not change significantly, regardless of the treatment settings between 2003 and 2006, Curtis said.

"We did find that patients in rural areas tended to have to wait longer to begin their chemotherapy after diagnosis -- their wait times increased by up to five days from 2003 to 2006," Curtis said. "Whether this is something that could have a negative effect on treatment outcomes is still unknown, but it is something we should continue to follow."

The findings were published in the July 9 issue of theJournal of the American Medical Association.

The lower reimbursement may still have long-term effects that have yet to be realized, Curtis cautioned.

SOURCE: Duke University Medical Center, news release, July 8, 2008
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Old 10-31-2008, 05:16 PM
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Default Medicare drug plan spending drops $6B in 2008

In a rare bit of good news for taxpayers, the cost of the Medicare prescription drug program fell $6 billion this year — savings driven by the widespread use of low-cost generic drugs.

The prescription drug program for seniors has cost about one-third less — about $50 billion — than originally estimated since it started in January 2006.

Medicare prescription drug spending dropped by 12% to $44 billion in the fiscal year ended Sept. 30.

When the program started, the Congressional Budget Office had predicted it would cost $74 billion a year by 2008. Medicare actuaries predicted even higher costs. Seniors have seen savings, too. The monthly premium for basic drug coverage was $26.70 in 2008 — a third less than forecast.

"The program's been a success," says David Certner, legislative policy director for AARP, a senior advocacy group that offers Medicare drug plans. "After the initial confusion at the launch, it started delivering many benefits people need."

The drug plan was the most expensive new federal program since the 1960s, until the current financial bailout.

About 32 million seniors are now enrolled. Enrollment for 2009 begins Nov. 15.

Big reasons for the savings:

•Generic drugs. The use of generic drugs has grown sharply, especially among seniors. Norvasc, for high blood pressure, and Fosamax, for osteoporosis, are among expensive drugs now available in generic form. Generics account for 64% of Medicare prescriptions compared with 61% in the private sector, Medicare says.

•Fewer enrollees. The program has 2 million fewer participants than originally forecast. Some seniors decided to keep existing drug coverage, Medicare says. Also, fewer poor people enrolled than expected.

•Doughnut hole. Seniors have cut costs to avoid falling into the "doughnut hole" — a coverage gap in which drug expenses between $2,510 and $4,050 a year are not insured.

Medicare drug costs are expected to start rising again next year as early savings fade and the first of 79 million Baby Boomers start entering the program in 2011.

[url]http://www.usatoday.com/news/health/2008-10-30-medicare_N.htm?loc=interstitialskip

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Old 02-22-2010, 08:59 AM
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Default How Medicare’s Payment Cuts For Chemotherapy Drugs Changed Patterns Of Treatment

How Medicare’s Payment Cuts For Cancer Chemotherapy Drugs Changed Patterns Of Treatment
Mireille Jacobson1, Craig C. Earle2, Mary Price3 and Joseph P. Newhouse4

1 Mireille Jacobson (mjacobso@rand.org ) is a senior health economist at the RAND Corporation, in Santa Monica, California, and a faculty research fellow of the National Bureau of Economic Research.
2 Craig C. Earle is director of the Health Services Research Program at Cancer Care Ontario and the Ontario Institute for Cancer Research, in Toronto.
3 Mary Price is a programmer with the Center for Health Policy Studies, Division of Research, Kaiser Permanente, in Oakland, California.
4 Joseph P. Newhouse is the John D. MacArthur Professor of Health Policy and Management at Harvard University, in Boston, Massachusetts, and a research associate of the National Bureau of Economic Research.

Abstract

The Medicare Prescription Drug, Improvement, and Modernization Act, enacted in 2003, substantially reduced payment rates for chemotherapy drugs administered on an outpatient basis starting in January 2005. We assessed how these reductions affected the likelihood and setting of chemotherapy treatment for Medicare beneficiaries with newly diagnosed lung cancer, as well as the types of agents they received. Contrary to concerns about access, we found that the changes actually increased the likelihood that lung cancer patients received chemotherapy. The type of chemotherapy agents administered also changed. Physicians switched from dispensing the drugs that experienced the largest cuts in profitability, carboplatin and paclitaxel, to other high-margin drugs, like docetaxel. We do not know what the effect was on cancer patients, but these changes may have offset some of the savings projected from passage of the legislation. The ultimate message is that payment reforms have real consequences and should be undertaken with caution.

Key Words: Physician Payment • Medicare

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 substantially reduced reimbursements for outpatient chemotherapy drugs. Prior to the act’s passage, Medicare reimbursed such drugs at the lesser of the charge billed for the drugs, or 95 percent of the average wholesale price (AWP) of the drugs. Many drugs were widely available to physicians at costs averaging 13–34 percent below the average wholesale price, and some agents were priced significantly lower. (At the same time, Medicare paid what many oncologists viewed as a below-cost fee for them to administer the drugs.) The net effect was that physicians and outpatient clinics administering the drugs were able to "buy" them on the open market at one price and "sell" them to Medicare patients at a higher price.

The large discrepancy between payment rates and acquisition costs for these drugs was identified as early as 1997. The then-named General Accounting Office, now the Government Accountability Office, reported widely available discounts of about 20 percent below average wholesale price for two drugs, carboplatin and paclitaxel, in 2001. A later analysis calculated that reimbursement for paclitaxel in 2004 was six times higher than actual cost. These reports documented that these chemotherapy purchase prices were well below Medicare reimbursement rates. As a result, the Medicare reform law aimed to lower Medicare spending by reducing reimbursements for specific drugs. It also aimed to reduce the incentive to prescribe certain drugs that afforded particularly higher margins for the doctors and clinics but did not offer any clear clinical advantage for patients.

Under the law, starting 1 January 2004, Medicare first lowered reimbursements on the drugs from 95 percent to 85 percent of average wholesale price as of 1 April 2003. Then, on 1 January 2005, Medicare instituted a new payment system based on a so-called average sales price. Under this system, Medicare reimburses chemotherapy agents based on manufacturers’ average national sales prices over the previous two quarters plus 6 percent to ensure adequate reimbursement to providers facing above-average drug costs. Medicare also began paying physicians an increased fee for administering the drugs, to better approximate physicians’ and clinics’ actual costs.

The new payment system set chemotherapy reimbursements at 1.06 times the average costs of the drugs. This rate represented a notable decline from the 2004 weighted average payment-to-cost ratio of 1.22. Comprehensive estimates of what this ratio was prior to 2004 are unavailable, but it was likely higher since reimbursement as a percentage of average wholesale price was higher.

The implicit reduction in margins for oncology drugs raised important concerns about cancer treatment. Many feared that the legislation’s reimbursement change would reduce access to cancer chemotherapy for Medicare beneficiaries. Community oncologists worried that the law would make it too unprofitable to treat cancer patients, forcing them to shift some beneficiaries from their offices to hospitals, where the patients might face treatment delays.

Previously published studies have found no evidence that cancer patients on Medicare experienced delays in chemotherapy treatment. To date, however, no work has formally assessed whether the likelihood of receiving chemotherapy in the first place has changed, or whether the administered agents have changed. Our study was designed to determine the answers.

[url]http://content.healthaffairs.org/cgi/content/abstract/hlthaff.2009.0563v1
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Old 06-29-2010, 02:25 AM
gdpawel gdpawel is offline
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Default Another Smoking Gun

The findings of this paper add to the survey done by Dr. Neil Love, entitled "Patterns of Care" [url]http://patternsofcare.com/2005/1/editor.htm

In Jacobson and colleagues' study, physicians switched from dispensing the drugs that experienced the largest cuts in profitability, carboplatin and paclitaxel, to other high-margin drugs, like docetaxel.

One of the results of Dr. Love's survey shows that for first-line chemotherapy of metastatic breast cancer, 84-88% of the academic center- based oncologists (who do not derive personal profit from infusion chemotherapy) prescribed an oral dose drug (capecitabine), while only 13% prescribed infusion drugs, and none of them prescribed the expensive, highly remunerative drug docetaxel.

In contrast, among the community-based oncologists (who do derive personal profit from infusion chemotherapy), only 18% prescribed the oral dose drug (capecitabine), while 75% prescribed infusion drugs, and 29% prescribed the expensive, highly remunerative drug docetaxel. (Patterns of Care: 2005,Vol 2,Issue 1).

While Newhouse and Earle's previous Michigan/Harvard study, "Does reimbursement influence chemotherapy treatment for cancer patients?" [Health Affairs 25, no. 2 (2006)] showed results before the new Medicare reform, Love's "Patterns of Care" study showed results that the Medicare reforms were still not working. This new study adds another "smoking gun" about the chemotherapy concession issue.

I believe that all of these studies showed results that the Medicare reforms are still not working. An impossible conflict of interest still exists. And the existence of this profit motive in drug selection has been one of the major factors working against the individualization of cancer chemotherapy based on testing the cancer biology. It is way past time to take medical oncologists out of the retail pharmacy business and let them be doctors again.

Infused Chemotherapy Use in the Elderly After Patent Expiration

Rena M. Conti, PhD, Meredith B. Rosenthal, PhD, Blase N. Polite, MD, Peter B. Bach, MD, MAPP and Ya-Chen Tina Shih, PhD

The University of Chicago, Chicago, IL; Harvard University School of Public Health, Boston, MA; and Memorial Sloan-Kettering Cancer Center, New York, NY

Corresponding author: Rena M. Conti, PhD, The University of Chicago, 5841 S. Maryland, MC 6086, Chicago, IL 60637; e-mail: [email]rconti@uchicago.edu

Abstract

Purpose:

The use of anticancer drugs (chemotherapies) is an important determinant of national spending trends. Recent policies have aimed to accelerate generic entry among chemotherapies to generate cost savings.

Methods:

We examined the effects of generic entry on the choice of chemotherapy for the treatment of metastatic colorectal cancer (MCRC) between 2006 and 2009 using autoregressive-moving average modeling with case control. A nationally representative sample of oncologists and patients with cancer (age ≥ 65 years) was employed to estimate the magnitude and significance of the impact of the generic entry of irinotecan in February 2008 on the number of administrations of irinotecan compared with oxaliplatin.

Results:

The generic entry of irinotecan resulted in a 17% to 19% decrease (P < .001) in use among elderly patients with MCRC compared with oxaliplatin. The results were robust to multiple sensitivity checks.

Conclusion:

This study provides novel and robust estimates of the decline in use of a chemotherapy to treat a common cancer in the elderly after patent expiration. The results suggest estimates from a previous Office of the Inspector General report of the potential savings derived from the generic entry of irinotecan for public payers are an overestimate, likely confounded by oncologists' response to financial incentives, changes in scientific evidence, and promotional activities. As calls for improving the quality and cost efficiency of oncology increase, future empirical work is needed to examine the responsiveness of oncologists' treatment decision making to incentives among patients of all ages and insurance types.

Am J Manag Care. 2012;18(5 Spec No. 2):e173-e178

[url]http://www.ajmc.com/articles/Infused-Chemotherapy-Use-in-the-Elderly-After-Patent-Expiration
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Old 07-26-2010, 12:00 PM
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Default Study: Medicare Part D Helps Heart Failure Patients

A number of cancer patients die of heart failure, brought on by the intense (over-aggressive cocktail) regimes of chemotherapy.

Taxol (paclitaxel) is an extremely potent chemotherapy drug, often producing a number of side effects in patients, such as cardivascular problems: hypertension or problems with the heart, such as arrhythmias, congestive heart failure or bradycardia. Many patients on chemotherapy become anemic and that can trigger further cardiac complications.

Chemotherapy in general can have a deadly side effect: heart trouble. However, the "antimicrotubules" class of chemotherapy drugs, of which Taxol is a member, is supposed to be relatively rare (they really don't know). The Platins (Carboplatin and Cisplatin) may be much different. Heart problems are more common than people think, affecting up to 25% of cancer patients.

According to MD Anderson cardiologists, many doctors do not adequately monitor their patients or manage their care to minimize the health risk. Chemotherapy can help achieve a clinical response (remission), but treatments can also hurt heart muscle by reducing the hearts ability to pump.

Problems can range from insignificant to so severe that a patient can die from the heart damage rather than the cancer itself. In many cases, cancer treatment heart damage isn't detected until it is advanced because traditional heart imaging tools often miss heart muscle damage.

Medicare Part D may be helping more older Americans with heart failure get medication used to control the disease. A new study of nearly 7,000 older heart failure patients in a big insurance plan found the number of filled prescriptions for standard heart failure medication increased after Part D began in 2006, and the biggest increase was among seniors who previously lacked drug coverage.

The results, which were reported in the American Heart Journal, are the first to show Part D may help more people with heart failure get meds that are recommended to lower the risk of hospitalization and extend lives.

The study examined records for 6,950 people age 65 and older who were enrolled in a Pennsylvania Medicare managed care plan between 2003 and 2007. In the year before Part D began, 534 plan members had no coverage, and 4,600 had coverage with quarterly caps of $150 or $350. The remaining 1,800 had coverage through an employer or union, with no cap, the news service reports.

Among those who had lacked coverage, the average number of scrips filled each year rose from 13 to 19, and the percentage who filled at least one scrip for a beta-blocker increased from 45% in the two years prior to Part D, to 59% in 2006 and 2007. For a beta-blocker plus an ACE inhibitor or ARB, the percentage rose from 21% to 32%. Plan members who previously had drug coverage with quarterly caps showed smaller increases. The percentage filling a scrip a beta-blocker rose from between 55 and 58% to about 63%.

Julie Donohue of the University of Pittsburgh Donohue said that these findings are consistent with a major goal of the (Medicare Part D) policy, which was to reduce financial barriers to medication access among the elderly.

Source: American Heart Journal

Common chemotherapy drug triggers fatal allergic reactions

[url]http://cancerfocus.org/forum/showthread.php?t=2871
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Old 09-12-2010, 06:19 PM
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Default Medicare Cuts May Have Led Docs to Prescribe More Chemo

Cuts in Medicare payments to doctors who administer outpatient chemotherapy drugs actually led to an increase in treatment rates among Medicare recipients, finds a new study.

"This sort of dynamic runs contrary to what most people would expect, but economists often encounter this sort of thing," Joseph Newhouse, a professor of health policy and management at Harvard University, said in a Harvard news release.

Oncologists can purchase chemotherapy drugs directly from pharmaceutical companies for far below the suggested cost and then bill the patient's insurer the full suggested cost, sometimes making more than a 20 percent profit, according to background information in the news release.

But under the 2005 Medicare Modernization Act, Medicare no longer automatically pays what physicians bill. Instead, Medicare calculates the average amount that physicians typically pay for each chemotherapy drug and reimburse no more than 6 percent above this average cost.

When the payment cuts were introduced, critics said patient care would suffer, the study authors noted.

In the new study, Newhouse and colleagues analyzed Medicare claims for 222,478 beneficiaries diagnosed with lung cancer between 2003 and 2005. On average, chemotherapy treatment within one month of diagnosis increased 2.4 percent after the new rules took effect, from 16.5 percent to 18.9 percent.

In addition, the use of more costly chemotherapy drugs increased, while the use of less-expensive drugs declined, the researchers found.

The study, published online June 17, appears in the July print issue of the journal Health Affairs.

"Physicians don't always respond to incentives the way most people expect, but in this case they do respond in a way that makes sense to economists. It seems logical on the one hand that when you pay less, you get less. However, in this case, since a high proportion of an oncologist's income depends on prescribing, paying less per drug results in more drugs," study first author Mireille Jacobson, of the non-profit RAND Corp., said in the news release.

SOURCE: Harvard University, news release, June 17, 2010
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Old 01-31-2015, 06:47 PM
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Default In Cancer Care, It Appears that More Is Less

Robert A. Nagourney, M.D.

With the interest in “value oncology” and cost containment, a report appeared in the December 2014 Journal of Clinical Oncology that analyzed the impact of the Medicare Prescription Drug Act of 2003 (MMA) on chemotherapy administration in an environment of diminishing reimbursement to physicians.

[url]http://jco.ascopubs.org/content/32/36/4027.full

Prior to the passage of the MMA, oncologists were compensated at 95% of the average wholesale price of a drug. The government accounting office found that the larger medical oncology practices could form “buyers groups” and purchase drugs at lower prices allowing them to pocket the difference. A 2003 New York Times article decried the practice as a “Chemotherapy Concession” and Medicare responded. The MMA of 2003 changed the policy so that chemotherapy drugs were reimbursed at the national average sale price plus 6%. It was hoped that this would result in cost savings.

Practices were divided into Fee-For-Service and Integrated-Health-Networks, the latter largely HMOs and the Veterans’ Administration. It was expected that integrated networks would be less affected since their physicians are salaried and an 11% disparity between the two groups was noted for MMA agents. However, a number of interesting, unexpected and instructive trends emerged.

First, contrary to expectations, the overall use of chemotherapy actually increased following the passage of the MMA.

Second, the cost of cancer care continued to increase unabated following the passage of the MMA.

Finally, changes in drug use appeared to be disease-specific. Colorectal and small cell lung cancer patients saw a decline in the use of MMA affected drugs while non-small lung cancer showed an increase for both fee-for-service and integrated networks. With the overall use of MMA drugs in lung cancer increasing by 1.6 fold, the same drug use increase in the integrated (salaried) groups was 6.3 fold higher.

Among the findings the authors note “reimbursement after MMA passage appears to have had less impact on prescribing patterns in fee for service than the introduction of new drugs and clinical evidence.” This gives the lie to the idea that practicing oncologists are driven by self-gain, a popular narrative in the current political environment.

The authors did find that passage of MMA “resulted in consolidations and acquisitions of practices by hospitals, many of which were able to purchase chemotherapy drugs at discounted rates through the federal 340B* program. Although the full impact of these changes is not known, the shift of chemotherapy from community practices to hospital outpatient settings is associated with higher total costs.”

Community fee-for-service oncologists represent a qualified, yet under-appreciated resource for patients. While their academic brethren bask in the limelight, it is private practitioners who must make sense of the complex and overly dose-intensive treatment schedules handed down to them by ivory tower investigators. We now come to learn that while fee-for-service doctors have been forced to consolidate, join hospital systems, or retire, the cost of cancer care has actually climbed by 66% since the passage of MMA.

It would appear that this experiment has failed. Costs were not contained and drug use was not curtailed. What other bright ideas can we expect from policymakers who seem intent on bending medical care to their wishes at the expense of doctors and their patients?

*The 340 B program was originally created by the Federal government to allow charitable hospitals to save money on expensive drugs by allowing them to purchase them at deep discounts. Over time a growing number of “not-for-profit” hospitals demanded the same consideration. Subsequent analyses have found that the majority of the hospitals that now take advantage of 340B actually provide less charity care than the national average. Hospitals that charge full fee for drug administration can then pocket the difference.
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Gregory D. Pawelski
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