Health Policy Report – July 25, 2024

Texas Oncology – Waco Hosts HHS Delegation and Site Visit

On June 24, Texas Oncology – Waco hosted representatives from the Department of Health and Human Services (HHS), the Centers for Medicare and Medicaid Services (CMS), the CMS Innovation Center (CMMI), and the Health Resources and Services Administration (HRSA) for a site visit. Led by Dr. Carlos Encarnacion and Practice Director Charla Herndon, the tour provided an opportunity for Texas Oncology – Waco to discuss the practice’s history, rural patient outreach, and operational challenges with HHS, CMS, and CMMI. The conversation focused on Texas Oncology’s participation in CMMI models, emphasizing how they’ve enhanced services, improved quality, and reduced costs while maintaining affordable, high-quality patient access.

The US Oncology Network and Texas Oncology look forward to continuing to work with HHS to enhance the delivery of cancer care and protect patient access to high-quality, affordable care in the most efficient manner.

To read more, CLICK HERE.

CMS Releases Proposed Rule on Physician Fee Schedule, Hospital Outpatient Proposed Payment System

The Centers for Medicare & Medicaid Services (CMS) on July 10 issued the CY 2025 Medicare Physician Fee Schedule (PFS) and Quality Payment Program (QPP) proposed rule, in addition to the Hospital Outpatient Prospective Payment (HOPPS) proposed rule. 

In the Medicare Physician Fee Schedule proposed rule, CMS proposed a cut to the conversion factor of $32.36, a decrease of $0.93 (or 2.8%) from the CY 2024 PFS conversion factor, marking the fifth straight year with a cut. The conversion factor is the multiplier that Medicare applies to relative value units (RVUs) to calculate reimbursement for services or procedures under Medicare’s fee-for-service system.

In response, provider groups expressed concerns over the decrease in physician payments, noting that the cuts exacerbate instability in the healthcare system.

“Ongoing cuts undermine the ability of patients to receive vital, high-value cancer care close to home, and elucidate the need for legislative action to create long-term, comprehensive Medicare payment reform. ASTRO calls on Congress to usher in a sustainable solution to ensure that people with cancer can access their treatments without unnecessary financial or geographic barriers,” Jeff M. Michalski, MD, MBA, FASTRO, Chair of the American Society for Radiation Oncology (ASTRO) Board of Directors, said in a statement.

Similarly, the American Medical Association (AMA) called on Congress to find a long-term solution. “With CMS estimating a fifth consecutive year of Medicare payment reductions—this time by 2.8%—it’s evident that Congress must solve this problem,” said AMA President Bruce A. Scott, MD. “In addition to the cut, CMS predicts that the Medicare Economic Index [MEI]—the measure of practice-cost inflation—will increase by 3.6%. Facing this widening gap between what Medicare pays physicians and the cost of delivering quality care to patients, physicians are urging Congress to pass a reform package that would permanently strengthen Medicare.”

CMS also unveiled a proposal to remove coverage of barium enema as a method of screening and proposed to expand coverage for colorectal cancer screening (CRC) screening to include Computed Tomography (CT) Colonography.

Meanwhile, in the Hospital Outpatient Prospective Payments (OPPS) proposed rule, CMS proposed an increase of 2.6% to Medicare outpatient payments. In a statement, The Network expressed disappointment in the widening gap between physician and outpatient payment. “It is really discouraging to see the Medicare physician fee schedule cut year after year,” said Dr. Marcus Neubauer, Chief Medical Officer of The US Oncology Network. “Independent oncology practices support high-quality care for patients in communities across the nation. Cuts that threaten our sustainability and access to care for our patients must end– it isn’t good for cancer care.”

To read more about the PFS proposed rule, CLICK HERE and HERE.  

To read The Network’s statement, CLICK HERE.

Federal Trade Commission Releases Interim Report on Pharmacy Benefit Managers (PBMs)

In a recent interim report, the Federal Trade Commission (FTC) revealed how pharmacy benefit managers (PBMs) are profiting at the expense of patients and independent pharmacies.

After years of criticisms about pharmacy benefit managers (PBMs), the Federal Trade Commission issued an interim report revealing how these middlemen inflate drug costs and squeeze independent pharmacies. The FTC reached out to the nation’s top six PBMs – Express Scripts, CVS Caremark, Optum Rx, Humana Pharmacy Solutions, Medimpact, and Prime Therapeutics – for information. The report is part of an ongoing inquiry launched by the FTC in 2022 on PBMs and their impact on access and affordability of care.

The report found that pharmacies affiliated with the top three PBMs in the country are often paid 20 – 40 times the national average cost for acquiring a drug. Further, the report noted that certain contact practices and tactics used to steer patients to acquire drugs from PBM-affiliated pharmacies contribute significantly to inflated drug costs. Additionally, the report found that rebate contracts between PBMs and drug makers are structured to provide payments from the drug manufacturer to health plans, in exchange for favorable formulary placement – disrupting patient access to more affordable medications.

However, the FTC highlighted that several PBMs have yet to supply the information requested. Still, the report renewed calls from legislators, led by Ron Wyden (D-OR), Chair of the Senate Finance Committee, to pass PBM reform legislation and move it to the president’s desk by the end of the year.

To read the report, CLICK HERE.

To read more, CLICK HERE.

House Oversight Committee Holds Hearing on PBMs

On July 23, the House Committee on Oversight and Accountability held a hearing on how pharmacy benefit managers (PBMs) alleged use of anti-competitive practices has impacted prescription drug costs, independent pharmacies, and patient care.

During the hearing, executives from the nation’s three largest PBMs – Adam Kautzner, PharmD of Express Scripts, David Joyner of CVS Caremark, and Patrick Conway, MD of OptumRx – provided testimony.

Committee Chairman James Comer (R-KY) opened the hearing by reviewing some of the findings of the committee. “PBMs position as middlemen should have enabled them to reduce the costs of prescription drugs and improve Americans’ health outcomes – they have not,” he stated.

Ahead of the hearing Oversight Chairman James Comer (R-KY) released a report entitled, “The Role of Pharmacy Benefit Managers in Prescription Drug Markets,” outlining how the largest PBMs have monopolized the pharmaceutical marketplace by utilizing deliberate, anticompetitive pricing tactics that are raising prescription drug prices, undermining community pharmacies, and harming patients across the United States.

To view the hearing, CLICK HERE.

To view the report, CLICK HERE.

Three Major Drugmakers Continue to Push Lawsuits Against Medicare Drug Price Negotiation Program

After facing legal setbacks earlier this year, Johnson & Johnson, Bristol Myers Squibb, and AstraZeneca have filed appeals in lawsuits against the Medicare drug price negotiations being rolled out under the Inflation Reduction Act.

On July 12, Johnson & Johnson and Bristol Myers Squibb filed an appeal at the U.S. Court of Appeals for the Third Circuit, while AstraZeneca filed an opening appeal before the Third Circuit on July 15.

The lawsuits argue that the Medicare drug price negotiation program violates the companies’ Fifth Amendment rights by taking private property without adequate compensation. Further, the companies argue that the program violates their First Amendment rights by compelling them to enter agreements that they wouldn’t otherwise.

The three drugmakers each have drugs up for negotiated prices beginning in 2026.

To read more, CLICK HERE.