[Ip-health] Washington Post: Medicare boosts payment for breakthrough cancer therapy

Thiru Balasubramaniam thiru at keionline.org
Mon Aug 5 00:48:08 PDT 2019


Medicare boosts payment for breakthrough cancer therapy

But the change doesn’t go as far as many health providers had hoped.

By Laurie McGinley
August 2

Medicare officials on Friday said it would increase reimbursements to
hospitals for expensive new medical technologies, including a high-priced
therapy used as a last-resort treatment for patients with blood cancers.

The Centers for Medicare and Medicaid Services issued a final rule raising
payments for new technologies from 50 percent to 65 percent of estimated
costs. CMS Administrator Seema Verma said the step would promote access to
potentially lifesaving treatments and reduce uncertainty about payments for
a cancer immunotherapy known as CAR T-cell therapy, among other new

But the increase only partly eases the squeeze on hospitals offering CAR
T-cell therapy, health providers said. The change means hospitals will be
reimbursed about $240,000 for the cancer treatment for Medicare lymphoma
patients, up from $186,500. The hospitals pay a list price of $373,000 for
the treatment, and related costs can drive their expenses much higher.

Jayson Slotnik, a partner at Health Policy Strategies, a consulting firm,
said hospitals and manufacturers will be disappointed by the CMS decision.
Some provider groups and manufacturers said the agency should raise the
payment to 80 to 100 percent of costs.

“Under this plan, I have concern that access to CAR T won’t be universal,”
he said, adding that only some hospitals will be able to afford to offer it.

Currently, hospitals say they lose tens of thousands to hundreds of
thousands of dollars on each Medicare patient who gets CAR T.

Joseph Alvarnas, an oncologist at the City of Hope Comprehensive Cancer
Center, was muted in his response. “For now, this should probably be viewed
as a step forward, but an incremental (rather than decisive) one,” he said.
He noted that technology payments last for three years, so it is not clear
what happens when the one for CAR T expires in 2021.

But the Leukemia & Lymphoma Society said it was “very pleased” by the CMS
decision. The American Hospital Association said the change will provide
“some much-needed short-relief” but further long-term solutions are needed.

The CMS decision came after months of criticism from hospital officials
about what they said were inadequate reimbursements. Some oncologists have
warned that the low payments have resulted in smaller-than-expected numbers
of patients receiving the treatment.

The CMS announcement was part of the agency’s final rule for payment rates
for hospital inpatient services and long-term care hospitals for fiscal
year 2020, which begins Oct. 1.

The Food and Drug Administration has approved two versions of CAR T-cell
therapy, which stands for chimeric antigen receptor T-cell. Kymriah is made
by Novartis for certain types of lymphoma and childhood leukemia, and
Yescarta is manufactured by Gilead Sciences for lymphoma.

The treatment, when it works, can last for months, years or even a
lifetime, experts say. Still, a substantial proportion of patients who are
treated eventually relapse.

The complicated treatment uses the patient’s own immune system to fight
cancer. Their T cells, which are part of the immune system, are extracted,
sent to a special lab and genetically modified to attack a protein on the
surface of the cancer cells. After being multiplied in number, the T cells
are infused back into the patient, where they expand further, creating an
army of anti-cancer agents.

Separately, CMS is weighing whether to issue a national policy that will
cover CAR T-cell therapy for Medicare patients everywhere in the United
States. Currently, Medicare’s local administrators decide whether Medicare
patients will be covered, which can lead to regional differences in
coverage and patient access.

Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International
41 22 791 6727
thiru at keionline.org

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