[Ip-health] Wall Street Journal: Medicare Moves to Cover Costly Cell Therapies

Thiru Balasubramaniam thiru at keionline.org
Wed Aug 7 21:49:13 PDT 2019



Medicare Moves to Cover Costly Cell Therapies

Hospitals can get reimbursement for at least 65% of the costs of CAR-T
therapies and related treatment

By Jonathan D. Rockoff
Aug. 7, 2019 9:08 pm ET

Medicare and Medicaid will cover an expensive new kind of cancer drug and
related services, though the federal government insurance programs won’t
pay 100% of the costs, which can approach $1 million a patient.

The move, announced Wednesday by the Centers for Medicare and Medicaid
Services, could pave the way for more patients to get the cancer drugs,
known as CAR-T treatments because hospitals will know they can get payments
covering some if not all of the costs.

“We’re taking action to make sure we’re modernizing the program to provide
access to the latest therapies,” CMS Administrator Seema Verma said in a
conference call with reporters.

Under the new move, known as a national coverage decision, hospitals will
know they can get Medicare and Medicaid reimbursement for at least 65% of
the costs of the drug and related treatment. Hospitals can ask for even
more reimbursement if they encounter additional costs.

Hospitals will have to wait, however, for CMS to figure out the full cost
of CAR-T treatment that it will pay and to issue a billing code for the

CAR-T is a new kind of drug, which takes a patient’s own cells and
engineers them to fight cancers. So far, the Food and Drug Administration
has approved two: Kymriah from Novartis and Yescarta from Gilead Sciences
Inc. for certain lymphomas and leukemias.

The treatments provide new options for the cancer patients. Yet their use
has been limited, in part because hospitals aren’t always sure they could
get reimbursed for both the cost of the drugs and the lengthy hospital
stays for side effects and other care that are often required.

The problem was that health-insurance payments aren’t structured for
treatments like a CAR-T, which trigger not just the price of the drug
itself but related care costs that can reach hundreds of thousands of
dollars. Novartis listed Kymriah for $475,000, while Gilead priced Yescarta
at $373,000.

Until the latest move, hospitals weren’t sure they could get paid beyond
the cost of the drugs and if they did, how much the payment would be.

CMS said last week that it would pay at least 65% of a hospital’s costs,
but the announcement left coverage decisions to private regional
contractors hired by the agency to administer claims. The contractors will
grant reimbursement so long as certain criteria are satisfied, such as the
hospital gives the drug for a use that the FDA approved or that is outlined
in medical guidelines approved by CMS.

Ms. Verma described CMS’s newest move as an interim step, while the agency
gathers more information about how much CAR-T treatment costs in order to
develop a payment rate and accompanying billing code.

“There will be more to come from the agency on CAR-T,” Ms. Verma said. She
added that the agency still faces the issue of how to pay for such
expensive new treatments over the long term.

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

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