Community Oncology Alliance Finds Proposals in 2019 Medicare Physician Fee Schedule Puzzling

CMS Proposals Devalue Evaluation and Management of Cancer in Seniors, Will Raise Drug Costs

No words can adequately describe how puzzling the CMS 2019 Medicare Physician Fee Schedule proposals are”
— Ted Okon, executive director of COA
WASHINGTON, DISTRICT OF COLUMBIA, UNITED STATES, July 13, 2018 / -- Yesterday, the Centers for Medicare & Medicaid Services (CMS) released its proposed rule for the 2019 Medicare Physician Fee Schedule. Although the Community Oncology Alliance (COA) has not yet conducted an in-depth analysis of the rule, there are two proposals that initially raise alarm.

First, CMS is proposing to drastically cut payment for the critical evaluation and management of more complex cancer cases from $172 to $135 (a 22% payment cut) for a new patient and from $148 to $93 (a 37% payment cut) for an existing patient. Although CMS is proposing to streamline the reporting of these cases, the proposal severely undervalues the thorough and critical evaluation and management of seniors with cancer, especially life-threatening complex cases.

Second, CMS is proposing to cut Medicare Part B reimbursement for new cancer drugs and other specialty therapies to the rate of list price plus 1.35%, factoring in the sequester cut, for the first six months on the market. This is a payment cut from the current rate of wholesale acquisition cost (WAC) plus 6%, or what is really plus 4.3% when factoring in the sequester. COA believes that this payment cut for new cancer therapies will result in drug manufacturers actually increasing WAC list prices so that their new products will not be at a competitive disadvantage to existing products which are reimbursed at average sales price (ASP) plus 6%.

“No words can adequately describe how puzzling the CMS proposals are,” said Ted Okon, executive director of COA. “At a time when the Trump administration is floating its blueprint to bring down drug prices, they are proposing a move that will actually fuel list prices of chemotherapy and other life-saving drugs. And their scheme to pay a physician the same amount for evaluating a case of sniffles and a complex brain cancer simply defies all logic. It is the antithesis of value-based healthcare and cheapens the medical care seniors are entitled to under Medicare.”

Nicolas Ferreyros
Community Oncology Alliance
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