Health Policy Report – March 5, 2024

Dr. Marcus Neubauer Pens Op-Ed Urging Action on Hospital Consolidation

In a recent op-ed in MedPage Today, Dr. Marcus Neubauer, Chief Medical Officer of The US Oncology Network, outlined the negative impact that hospital consolidation has on independent medicine and patient access to care. Dr. Neubauer notes that over the last 25 years, hospital mergers have reduced the number of hospitals from about 8,000 to just over 6,000. “Ultimately, however, hospitals’ market power has gone largely unchecked, resulting in fewer physicians owning their own practices,” Dr. Neubauer writes.

In the piece, Dr. Neubauer describes how hospitals are using their growing market power to engage in anti-competitive behavior such as patient steering, referral restraints, and strong-arm negotiating tactics. He cited lawsuits in Wisconsin and North Carolina, where health systems used acquisitions, referral restraints, and non-compete agreements to stifle competition and hike prices across their facilities. Meanwhile, in Pennsylvania, Alliance Cancer Specialists was faced with referral restraints from a large health system after rebuffing an acquisition attempt years prior. 

“Less competition is harmful to consumers. But for patients, it can distort their quality of care and where they receive it, leading to higher costs and reduced access to vital health services, including cancer treatment. As this issue continues to spiral out of control, federal and state policymakers must implement policies that rein in hospitals and healthcare systems’ use of these anti-competitive tactics,” Dr. Neubauer concluded.

To read Dr. Neubauer’s op-ed, CLICK HERE.

In Letter to the Editor, Dr. Shail Dalal Highlights Progress on White Bagging 

Dr. Shail Dalal, hematologist-oncologist at Texas Oncology-Palestine, recently penned a letter to the editor in the Palestine Herald-Press highlighting the recent passage of HB 1647, a bill that prohibits insurers and pharmacy benefit managers (PBMs) from enforcing harmful “white bagging” policies on Texas cancer patients and other patients with chronic, complex, rare, or life-threatening diseases.

“As a practicing oncologist for 20 years, I thank Representative Cody Harris for championing this critical patient protection law that will improve cancer care, while demonstrating to the rest of the country how to create policy that restricts insurers and PBMs from putting profits over patients,” Dr. Dalal wrote. 

Dr. Dalal’s letter to the editor comes as states across the country are considering similar legislation. Notably, Colorado House lawmakers recently passed HB 24-1010, a bill that mirrors HB 1647 by prohibiting white bagging mandates for patients with chronic, complex, rare, or life-threatening medical conditions. “Health care decisions should be based on the health and safety of a patient, not dictated by profits for health care insurers,” said Rep. Iman Jodeh, D-Aurora, sponsor of HB 24-1010, in a statement. The bill will now move to the Colorado Senate for consideration and final passage. 

To read Dr. Dalal’s letter to the editor, CLICK HERE.

To read a statement from Colorado lawmakers on HB 24-1010, CLICK HERE. 

Congress Passes Short-Term CR, Releases Draft Bill to Reduce Physician Fee Schedule Cuts

On February 29, congressional leaders reached an agreement on fiscal 2024 appropriations bills, putting lawmakers on course to wrap up the process in the coming weeks. The deal includes a new continuing resolution (CR) that will extend funding for agencies like the Food and Drug Administration (FDA) until March 8. Funding for these agencies was originally set to expire on March 1. Meanwhile, funding for remaining agencies, including the Department of Health & Human Services (HHS), will be pushed to March 22, rather than March 8, as originally scheduled. The deal follows intense negotiations among congressional leaders, who were called to the White House on February 27 to work out differences. 

Over the weekend, appropriators released draft legislation to fund the first subset of federal agencies for the rest of the 2024 fiscal year, which includes a 1.68% increase to the Medicare Physician Fee Schedule through December 31, 2024. This would reduce the 3.4% cut to the physician fee schedule that went into effect on January 1, 2024, by about half on a go-forward basis. The slimmed down appropriations bill also includes an extension for the Advanced Alternative Payment Model bonus for the 2024 performance year; however, the 3.5% bonus has been reduced to 1.88%. Congress is expected to vote on the bill after the March 8 funding deadline.

Although there is a slight mitigation to the physician schedule cuts, the bill does not contain healthcare provisions such as site neutral payments, pharmacy benefit manager (PBM) reforms, or a provision to allow for the resumption of home delivery of needed oral medications. These reforms remain top-of-mind for both industry experts and lawmakers. In a recent letter to the editor in KFF Health News, Dr. Scott Rushing, Compass Oncology, urged Congress to address rising consolidation through site neutral payment reform. “It’s time for Congress to finish the job through bills like the Lower Costs, More Transparency Act and the SITE Act, which would help level the playing field once and for all,” Dr. Rushing wrote. 

To read the text of the funding bill, CLICK HERE.

To read Dr. Rushing’s letter to the editor in KFF Health News, CLICK HERE.

To read the Lower Costs, More Transparency Act (H.R. 5378), CLICK HERE.

To read the SITE Act (S. 1869), CLICK HERE.

States Expand Use of Prescription Drug Affordability Boards

On February 23, Colorado’s prescription drug affordability board (PDAB) agreed to set a payment limit on Amgen’s Enbrel, marking the first time any state PDAB has moved to cap a medicine’s price. The board will now embark on a months-long process to determine an upper payment limit for the drug and is likely to encounter significant pushback from Amgen.

The Colorado board’s move comes as states seek to establish PDABs to review certain high-cost prescription drugs and determine if states should take action to reduce those costs. 12 states are currently considering legislation to establish a PDAB, while 10 states had a PDAB in place as of October 2023. While the primary function of these boards is to reduce government and commercial market spending, their exact functions vary from state to state. Additionally, their effectiveness is highly dependent on how these boards evaluate affordability and whether drugmakers will successfully challenge these efforts in court.

In any case, PDABs’ work across the country is set to augment federal efforts, like the drug pricing reforms in the Inflation Reduction Act, and signals continued interest in lowering government healthcare spending and out-of-pocket costs for patients.

To read more about the Colorado PDAB’s decision, CLICK HERE.

New Study Reveals Drop in Cancer Incidence During COVID-19 Pandemic

A new study from JAMA Oncology reveals that more than 134,000 cancers might have gone undiagnosed during the first 10 months of the COVID-19 pandemic. The study analyzed 2020 U.S. cancer incidence data to evaluate disruptions and delays in cancer diagnoses during the first year of the COVID-19 pandemic.

According to the study, diagnosis of early- and late-stage cancers declined, with prostate, breast, and lung cancers accounting for the most potential missed cases. The disruption had the biggest impact from March to May of 2020, when total cancer diagnoses decreased by 38.6% from the expected rate.

“While the world focused on the threat posed by a novel respiratory virus, the threat of cancer remained ever present, and any associated reduction in observed cancer incidence during this period is of particular concern. Unlike other population health outcomes studied, a decline in new cancer diagnoses in 2020 does not indicate that cancer occurrence in the US decreased, but rather that new cancers were undetected. The longer cancer exists undetected, the greater the risk of tumor progression and the lower the chances of survival and other positive outcomes for patients,” the authors wrote.

To read more, CLICK HERE.

To read the study, CLICK HERE.