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Legislative and Economic Update

Legislative and Economic Update. Arash Naeim, MD PhD Director, UCLA Geriatric-Oncology Member, ASCO Clinical Practice Steering Subcommittee. Special Thanks. Joseph S. Bailes, MD Chair, ASCO Government Relations Council Shelagh Foster, Esq ASCO Leglislative Affairs Georgia Nixon

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Legislative and Economic Update

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  1. Legislative and Economic Update Arash Naeim, MD PhD Director, UCLA Geriatric-Oncology Member, ASCO Clinical Practice Steering Subcommittee

  2. Special Thanks • Joseph S. Bailes, MD • Chair, ASCO Government Relations Council • Shelagh Foster, Esq • ASCO Leglislative Affairs • Georgia Nixon • Program Coordinator, ASCO State/Regional Affiliate Program

  3. Overview • Physician Reimbursement • Quality Initiatives • Drug Coverage • Treatment Plans • Imaging • Red Blood Cell Support • Coverage of Clinical Trials • Recovery Audit/Medicare Administrative Contractors • Food and Drug Administration • Appropriations for National Institutes of Health • Workforce • Cost of Cancer

  4. Medicare Physician Fee Schedule • Annual Update • 10.6% decrease in conversion factor (CF) was set to go into effect on July 1, 2008 • Congressional action instead continued 2008 increase of 0.5% for July – December. In 2009 there will be a 1.1% increase • Brief time where 10.6 cut was in effect. Legislation was retroactive • CMS should be automatically reprocessing claims that had the 10.6% reduction

  5. Ongoing Issues with SGR • Sustainable growth rate methodology (“SGR”) will reduce physician fee schedule conversion factor by about 5% each year for several years unless Congress fixes it permanently. • SGR compares actual expenditures to target amount and penalizes or rewards any difference • Congress keeps passing short term fixes which makes the subsequent cut larger • Issues impeding SGR fix include: • Very expensive to fix permanently. • What is the appropriate formula?

  6. Legislative Outlook - SGR • Congress now has until the end of 2009 to fix SGR • Leadership discussing various options but cost still an issue

  7. Oncology Reimbursement Quality Measurement Payments for chemotherapy and supportive care drugs Imaging Legislative Outlook

  8. Quality Measurement • ASCO has been on forefront of developing and implementing measures (e.g., NICCQ, QOPI, ASCO/NCCN Quality Measures) • Tax Relief and Health Care Act 2006 requires that measures be developed by specialty societies and put through a consensus organization. • National Quality Forum • AMA Physician Consortium for Practice Improvement • Ambulatory Quality Alliance • Others?

  9. Quality Measurement – PQRI 2008 • CMS will continue the Physician Quality Reporting Initiative (PQRI) with minor modifications • PQRI establishes a financial incentive for eligible professionals to participate in a voluntary quality reporting program • Payment bonus for 2008 is ~ 1.5% • Payment bonus for 2009 & 2010 ~ 2.0% • Program applies only to Medicare FFS and not Medicare Advantage • PQRI measures may be reported by non-physician practitioners

  10. Quality Measurement – PQRI 2008 (2) • 119 PQRI quality measures available in 2008 • 15 specific oncology measures and 13 general measures • 2007 oncology-related measures to be used in 2008, with some coding and specification changes • NOTE: Coding and specifications for breast cancer hormonal therapy (#71), colon cancer chemotherapy (#72) and chemotherapy planning (#73) measures have been changed • 2007 G codes cannot be submitted for these measures in 2008

  11. Quality Measurement – PQRI 2008 (3) • NOTE: Reporting for measures 71 (breast cancer hormonal therapy) and 72 (colon cancer chemotherapy) is more burdensome in 2008 • New CPT II staging codes require use of instructions for interpretation and reporting • Hormone Status, Stage, Adjuvant Hormonal Therapy for Stage IC to III (Breast) • Stage, Adjuvant Chemotherapy Code for Stage III (Colon) • ASCO requested changes to CPT II codes but AMA declined to make changes for 2008 because of time constraints

  12. Quality Measurement – PQRI 2009 (4) • CMS proposes to adopt several new cancer specific measures for 2009 including: • Medical and radiation: plan of care for pain • Pain intensity quantified • Radiation dose limits to normal tissues • Recording of clinical stage for esophageal & lung cancer • Measures to be deleted in 2009: • #74: Radiation recommended for invasive breast cancer • #104: Review of treatment options in patients with localized prostate cancer

  13. Payments for Chemotherapy and Supportive Care Drugs • Payments for drugs based on 106% of manufacturer’s average sales price (ASP) • Manufacturers report ASPs for their drugs to CMS within 30 days after the end of each calendar quarter • Payments for multiple-source drugs determined by weighting each drug’s ASP by its sales volume • Payments are adjusted quarterly with 2-quarter lag • New drugs are paid at 106% of wholesale acquisition cost (WAC) until ASP data are collected

  14. Principal Problems with ASP System • “Underwater” drugs • Some drugs are not available to some physicians at the Medicare payment amount. • Prompt pay discounts included in calculation but not passed on to the physician. • No exceptions process for particular drugs. • 2-quarter delay in adjusting payment amounts to reflect price increases • IVIG continues to be underwater but CMS has proposed to discontinue preadministration payment of $71 in 2008.

  15. Legislation Outlook – Towns Bill • H.R. 3011 • Sponsored by Reps. Towns (D-NY), Hall (R-TX) and Whitfield (R-KY) • Bill addresses “underwater” drugs: • Would establish a floor on Medicare payment for Part B drugs at the “widely available market price” (WAMP) • WAMP is defined in current law as the price that a prudent physician would pay for the drug • CMS would increase payment above 106% of ASP as necessary to reach WAMP

  16. Legislation Outlook – Towns Bill • Bill would also increase payment amounts in general • Manufacturers would no longer consider prompt pay discounts to wholesalers and distributors in reporting their average sales price (ASP) • These discounts do not go to physicians and therefore artificially lower ASP for purposes of calculating Medicare payments • Change would parallel 2005 change to calculation of average manufacturer price in Medicaid rebate program, which eliminated prompt pay discounts to wholesalers from the calculation

  17. Competitive Acquisition Program • Changes implemented to make CAP more attractive: • CAP vendor may not bill beneficiary for coinsurance until drug is administered • Time limit for physicians to file claims has increased from 14 days to 30 days • CMS will now allow a physician who has elected the CAP program to revoke that decision based on “exigent circumstances” in first 60 days of participation • Termination at any time also possible if “a circumstance not previously known to the practice” becomes a burden • For 2009 CMS proposes to allow transport of drugs between practice locations.

  18. Off-Label Drug Coverage • By statute, Medicare must cover off-label uses of drugs used in anticancer chemotherapy regimens if the uses are supported by citations in: • U.S. Pharmacopoeia – Drug Information (and successor publications) • American Hospital Formulary Service • CMS has authority to recognize other authoritative compendia as well. • Recent law harmonizes Part B and Part D off-label coverage rules for anticancer chemotherapy.

  19. Off-Label Drug Coverage (2) • CMS has established an annual process to review compendia. • CMS recently announced recognition of: • NCCN Drugs & Biologics Compendium • Clinical Pharmacology • Thomson Micromedex DrugDex • Thomson Micromedex DrugPoints will not be recognized. • AHFS will continue to be recognized.

  20. Off-Label Uses Not in the Compendia Medicare statute authorizes carriers to cover off-label uses of cancer drugs not in the compendia based on studies in peer-reviewed publications specified by CMS CMS’s current list of 15 journals had not been updated since legislation was passed in 1993 ASCO recommended that additional journals be added to the CMS list. CMS announced that an additional 11 journals would be recognized effective October 22, 2007.

  21. Recently Added Journals Annals of Oncology Biology of Blood and Marrow Transplantation Bone Marrow Transplantation Gynecologic Oncology Clinical Cancer Research Int’l Journal of Radiation, Oncology, Biology, and Physics • Journal of NCCN • Radiation Oncology • Annals of Surgical Oncology • Journal of Urology • Lancet Oncology

  22. Hospital Outpatient Issues • Payment for drugs • Separately billable drugs now paid at ASP + 5% • CMS proposes to further reduce payments to ASP + 4% in 2009. • Medicare proposes to continue paying separately for drugs costing more than $60 per day; drugs costing less than $60 are not reimbursed separately • Anti-emetics are reimbursed separately regardless of their daily cost in 2008

  23. Hospital Outpatient Issues (2) • IVIG • CMS is continuing payment for G0332, pre-administration services for IVIG; payment is approximately $37 in 2008. CMS has proposed eliminating payment in 2009. • Imaging • New proposal for composite imaging APCs would provide a single payment when two or more imaging procedures using same modality are conducted in one session.

  24. Oncology Treatment Plan and Summary • ASCO is developing a series of customizable, disease-specific chemotherapy treatment plans and summaries. • Treatment plan captures: • Planned chemotherapy regimen, dose, cycles and duration • Major side effects of chemotherapy regimen • Treatment summary describes: • Details of chemotherapy care delivered, major toxicities experienced, follow-up plan of care • Colon Adjuvant Chemotherapy , Breast Adjuvant Chemotherapy, and general Cancer Treatment Plan and Summary templates available: www.asco.org/treatmentsummary

  25. Legislation Outlook for 2008 – Capps-Davis Bill • H.R. 1078/S. 2790: Reps. Capps (D-CA) and Davis (R-VA)/Senator Landrieu (D-LA) developed in coordination with NCCS. • 114 Cosponsors • Adds new Medicare benefit for comprehensive cancer care planning services • Detailed plan of care furnished in person to cancer patient soon after diagnosis • Revised plan of care if substantial change in condition • Follow-up plan after completion of primary treatment • Revised follow-up plan if substantial change • Payment for plan of care or revision equal to payment for Level 5 new patient consult plus home health certification ($298 in 2006) • Service could be provided by physician or hospital

  26. Imaging Services Payments for technical component of imaging services provided in the office capped at HOPPS level (includes CT, PET, MRI, etc. but not mammography) Reduction of 25% for multiple imaging services in same “family” continuing. Savings will not be transferred to other services as CMS had planned For services affected by both provisions, CMS will first apply the multiple imaging adjustment and then apply the HOPPS cap

  27. Legislation Outlook for 2008 – Imaging • Recently passed Medicare bill requires physicians and other suppliers that furnish advanced diagnostic imaging services like MRI, CT and PET to meet Medicare accreditation criteria by 2012 • ASCO member of Access to Medical Imaging Coalition • GAO Report recommending prior authorization to control spending

  28. Medicare Coverage of Clinical Trials • In 2000, CMS issued a National Coverage Decision (NCD) announcing coverage for routine costs of clinical trials. • July 2007, CMS issued proposed revisions that would: • Eliminate automatic coverage for federally funded or FDA-reviewed trials • Instead, would require self-certification of trial with CMS according to 13 standards • October, 2007 – CMS decided not to proceed with proposed revisions but may revisit. • Brown-Specter (Senate), Pryce (House)

  29. Reporting on Hematocrit/Hemoglobin • Effective January 1, 2008, physicians must report hematocrit or hemoglobin levels on any claim for treatment of anemia in connection with cancer treatment. • Not limited to erythropoiesis stimulating agents (ESAs) but also applies if other anti-anemia drugs are used • CMS has issued carrier instructions on how to report. • CMS will accept “most recent” hematocrit or hemoglobin and will recognize that multiple claims may be submitted with the same hematocrit or hemoglobin.

  30. Reporting on Hematocrit/Hemoglobin (2) • CMS has released new modifiers for use in 2008; these need to be reported on claim form along with actual hematocrit/hemoglobin. • EA – ESA, anemia, chemo-induced • EB – ESA, anemia, radio-induced • EC – ESA, anemia, non-chemo/radio

  31. ESAs: What’s New The CMS NCD still stands FDA mandated changes to ESA labels (July 2008) Two new reports of negative outcomes in ESA studies (November/December 2007) ODAC met March 13 to review ESA safety data and make recommendations to FDA.

  32. Label Changes • ESAs are no longer indicated for patients receiving myelosuppressive chemotherapy if the anticipated treatment outcome is cure. They remain indicated when myelosuppressive chemotherapy is intended for palliation. • ESAs should not be initiated if the patient's hemoglobin is above 10 g/dL. Further, the label change • specifies that ESA treatment should target the lowest hemoglobin concentration that will avoid transfusion, • removes "...or exceeds 12 g/dL" as an upper range for ESA use, and • removes language that allowed earlier initiation of ESAs, or treatment to higher hemoglobin targets, if the patient cannot tolerate anemia due to a co-morbid condition.

  33. ASCO Actions on ESAs • Added language on FDA changes into recent ASCO/ASH guideline • Available online • Ongoing dialogue relating to the implementation of the national coverage decision

  34. Recovery Audit Contractors CMS Recovery Audit Contractors (RACs) have identified overpayments (and underpayments to a lesser extent) in New York, Florida, and California as part of a demonstration project. Drugs and services are subject to review. In response to complaints that audits are excessively burdensome, ASCO has recommended measures to CMS to make program less onerous on practices. Recent legislation authorizes expansion of RAC program to all 50 states by 2010.

  35. Medicare Administrative Contractors • Under a competitive bidding process, Medicare is replacing fiscal intermediaries and carriers with new entities called MACs • Will be two types of MACs • Part A/Part B MACs • Specialty MACs (covering durable medical equipment, home health, and hospice) • 15 Part A/Part B MAC regions

  36. Medicare Administrative Contractors (2)

  37. Medicare Administrative Contractors (3)

  38. FDA Reform and Drug Safety • Unanticipated safety problems with FDA-approved drugs to treat chronic conditions (Vioxx) causing policymakers to call for increased monitoring and oversight of drug safety • Congress recently passed legislation with drug safety provisions: • Risk Evaluation and Mitigation Strategies establish post-market safety procedures • Limits FDA Conflict of Interest Waivers • Requires sponsors to register trials in clinical trials database; HHS examining results database

  39. Biosimilars Legislation • HR 5629, the Pathway for Biosimilars Act, introduced by Representatives Anna Eshoo (D-CA) and Joe Barton (R-TX) • Interchangeability: “can be expected to produce the same clinical result” • No determination of interchangeability may be made without publication of a final guidance, following notice public comment.

  40. NIH Appropriations • ASCO and others in the cancer community are requesting a 6.6% increase for FY 2009. • NIH budget for FY 2008 and previous years essentially flat. President’s FY 2009 proposes another flat budget. • Likely to see a long-term “continuing resolution” to maintain 2008 funding through the election and possibly beyond.

  41. Kennedy-Hutchinson Initiative • NCI Funding • National Bio-specimen Network to detect patterns in cancer screening • Grants for molecularly oriented research into targeted therapy • Access to high quality care, national pathology standards, cancer survivors program

  42. Future Supply of and Demand for Oncologists • ASCO-commissioned study on supply and demand for oncology services • Reported in March 2007 Journal of Oncology Practice • Demand expected to rise 48% between 2005 and 2020 • Based on population aging and growth and improvements in cancer survival rates • Supply expected to rise 14% • Based on oncologists’ current age distribution, practice patterns, and number of oncology fellowships • ASCO Workforce Implementation Group to recommend steps to meet the challenge of workforce shortage

  43. Cost of Cancer • Significant advances in drug development of novel therapeutics associated with higher prices of individual drugs • Cancer patients are unfamiliar with how to approach difficult trade-offs associated with out-of-pocket expenses and expensive treatment with measurable yet often modest benefits. • ASCO has an ad-hoc task force examining this issue

  44. QUESTIONS ?????? Contact ASCO’s Cancer Policy & Clinical Affairs Department (571) 483-1670 / publicpolicy@asco.org

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