Health Policy Report – October 3, 2023

CMMI Director Liz Fowler Visits Texas Oncology San Antonio

Starting July 1, 2023, 12 oncology practices across the U.S. with more than 1,000 physicians — including Texas Oncology — started implementing the Enhancing Oncology Model (EOM) developed by the Center for Medicare & Medicaid Services (CMS). This latest step in value-based oncology care builds on Texas Oncology’s previous experience with the Oncology Care Model (OCM) designed to provide higher quality care at a lower cost.

As one of the largest oncology practices in the U.S. Texas Oncology’s participation is important to the overall success of EOM. To get an up close and first-hand view of the practice in operation, Elizabeth Fowler, Ph.D., J.D., CMS deputy administrator and the Center for Medicare & Medicaid Innovation (CMMI) director visited Texas Oncology–San Antonio Medical Center in September.

“Our practice has invested in staffing and enhanced services to improve patient care,” said Debra Patt, M.D., Ph.D., MBA, executive vice president at Texas Oncology, “as well as using electronic patient reported outcomes, or ePRO, which helps providers monitor symptoms in real time to be able to offer care quickly.”

Dr. Patt and Debbie Gaeke, executive director of Texas Oncology–San Antonio, led Dr. Fowler on a tour of the comprehensive cancer center — one of more than 250 sites in the practice — where they visited the lab, infusion pharmacy and retail pharmacy, infusion suite, radiation vault, and patient exam rooms.

“We were delighted to continue to demonstrate our commitment to value-based care, as well as enhancing our partnership with CMMI through EOM,” said Dr. Patt.

OCM Outcomes

In 2016, Texas Oncology implemented the OCM — precursor to the EOM — for Medicare beneficiaries undergoing systemic treatment for cancer. The outcomes achieved under OCM were stellar, including more than $160 million in savings to Medicare and other patient care improvements such as decreased emergency room visits and hospitalizations.

Dr. Patt will be presenting the results of using ePRO to improve the quality and value of cancer care under the OCM at the 2023 American Society of Clinical Oncology (ASCO) Quality Care Symposium, along with eight other presentations by Texas Oncology providers — all characterizing quality improvement initiatives to enhance the care of patients.

“In EOM, we are building on the success of OCM, extending the use of evidence-based processes already in place, including patient symptom response, digital treatment care plans and patient education, as well as an electronic health record built for clinical decision support, 24/7 access, and remote access,” said Susan Escudier, M.D., FACP, medical oncologist and hematologist, and vice president of value-based care at Texas Oncology.

Escudier is confident in the practice’s ability to meet the stringent criteria in EOM and plans to report on outcomes at the 2024 ASCO Quality Care Symposium.

The statements contained in this document are solely those of the authors and do not necessarily reflect the views or policies of CMS. The authors assume responsibility for the accuracy and completeness of the information contained in this document.

Congress Passes Short-Term Funding Package to Avoid Government Shutdown

Congress narrowly avoided a government shutdown on Saturday, September 30, as the House of Representatives approved a short-term funding package to keep the federal government through November 17. Following Senate passage, President Biden signed the bill shortly after midnight. The final bill, known as a continuing resolution (CR), will continue funding at current levels and provide $16 billion in disaster relief.

In the preceding days, concern grew in Washington as the House failed to advance various short-term spending bills. While mandatory spending programs, like Medicare, have permanent funding and would not immediately be impacted by a shutdown, federal staff not considered “essential” would have been furloughed, impacting federal healthcare agencies. Prior to the short-term funding agreement on Saturday, the Centers for Medicare & Medicaid Services (CMS) announced that 6,000 employees would stay on the job, while 88,000 employees would remain at the Department of Health and Human Services (HHS).

The short-term funding bill includes a temporary extension of some of the health programs set to expire after September 30, including funding for community health centers and the National Health Service Corps, as well as a delay of the Medicaid Disproportionate Share Hospital (DSH) pay cuts. However, the funding deal did not reauthorize the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR), Children’s Hospital Graduate Medical Education, the Pandemic and All-Hazards Preparedness Act, and federal addiction programs created by the SUPPORT Act, meaning that these programs expired at 12:01 a.m. on Sunday.

To read more, CLICK HERE and HERE.

Federal Judge Denies Bid to Halt Medicare Drug Price Negotiation Program

A federal judge on Friday, September 29, declined to block the Biden administration from implementing Medicare drug price negotiations as part of the Inflation Reduction Act. The lawsuit, brought by the Chamber of Commerce in June, argued that the drug negotiations violate the separation of powers, as well as the First and Fifth Amendments of the U.S. Constitution.

The Chamber of Commerce was the only group among lawsuits brought by six drugmakers and PhRMA that had sought an injunction to block the program. The Chamber asked the court to prevent the drug price talks before October 1, the deadline for manufacturers of the first 10 drugs selected for negotiations to agree to participate in the talks or face steep excise taxes.

“The Court is not convinced that granting Plaintiffs preliminary injunctive relief will protect them from imminent and irreparable harm,” the judge, Michael J. Newman, wrote in his opinion. “Any economic harm – which, on its own, is insufficient to satisfy this prong of a preliminary injunction analysis – will not occur for years in the future.”

The Chamber must follow an amended complaint by October 13, giving the Department of Justice (DOJ) until October 27 to renew its motion to dismiss.

Also, on Friday, September 29, Novo Nordisk became the latest pharmaceutical company to file a lawsuit against the administration’s drug price negotiation program. Novo Nordisk is now the ninth active case against the program, arguing that the negotiations also violate the First and Fifth Amendments.

To read more, CLICK HERE.

To read more about the Novo Nordisk lawsuit, CLICK HERE.

Protecting Patient Access to Cancer and Complex Therapies Act Introduced

On Wednesday, September 13, Senator John Barrasso, MD (R-WY) and Representative Michael Burgess, MD (R-TX) introduced the Protecting Patient Access to Cancer and Complex Therapies Act in the House and Senate, which would protect access to care for Medicare beneficiaries being treated with Part B covered drugs, including treatments for cancer.

As the Inflation Reduction Act (IRA) is currently written, Medicare reimbursement for negotiated drugs will be based on the Maximum Fair Price (MFP) plus six percent, rather than the standard Average Sales Price (ASP) plus six percent. These additional Part B payment cuts are untenable for many practices, particularly as providers have seen continued cuts to reimbursement over the years.

If passed, the Protecting Patient Access to Cancer and Complex Therapies Act would help address these cuts by having manufacturers directly rebate Medicare for the lower negotiated rates, preserving the original payment structure.

The legislation received widespread support from health care stakeholders. “The Protecting Patient Access to Cancer and Complex Therapies Act would ensure patients receive the benefit of lower prescription drug costs without unfairly penalizing providers. This important legislation removes physicians from the middle of the price negotiation process and preserves patients’ access to treatments and therapies they need,” The Network wrote in a letter to Sen. Barrasso, MD, Rep. Burgess, MD, and Rep. Murphy, MD. “On behalf of the nation’s leading community cancer care providers, we appreciate your recognition of the financial pressures facing independent providers today and thank you for your leadership on this issue.”

The bill’s introduction comes as lawmakers are scrutinizing the implementation of the IRA’s drug pricing provisions. In a House Oversight and Investigations Subcommittee Hearing, entitled “At What Cost: Oversight of How the IRA’s Price Setting Scheme Means Fewer Cures for Patients,” lawmakers expressed concern about how the IRA may impact medical innovation and patients’ access to care. “I’m deeply concerned that—because of the so-called Inflation Reduction Act—the American people will not have the same fighting chance for a host of serious diseases,” Rep. McMorris Rodgers explained.

To read the Protecting Patient Access to Cancer and Complex Therapies Act, CLICK HERE and HERE.

To read The Network’s letter to lawmakers, CLICK HERE.

To urge your Member of Congress to cosponsor this legislation, CLICK HERE.

To watch the House Oversight and Investigations Subcommittee Hearing, CLICK HERE.

Amid Senate Probe, New Study Shows 340B Program Reached $54 Billion in 2022

Sen. Bill Cassidy (R-LA), the top-ranking Republican on the Senate Health Committee, recently launched an investigation as to how certain hospital systems are spending revenue generated through the 340B drug discount program, which allows eligible hospitals to purchase prescription drugs at a discounted rate.

On Thursday, September 28, Cassidy sent letters to Cleveland Clinic and Bon Secours requesting information on how they use money generated from the 340B program. In the letters, Cassidy noted that, according to news reports, these hospitals have stripped vital services and haven’t passed drug savings down to patients, despite benefitting from the 340B program.

The investigation follows the release of a new report that details how hospitals and other entities bought a record $53.7 billion worth of medicines last year – a 22% jump from 2021. This increase came even though drug price growth lagged behind overall inflation, calling into question claims from some program advocates that drugmakers’ business practices are hindering the program’s effectiveness.

The report also showed that manufacturers’ contract pharmacy restrictions reduced 340B purchases by $270 million, or less than 1% of total purchases in 2022 – far below the figure quoted by hospital lobbyists. 

Congress has been weighing legislative proposals to increase oversight of the 340B program, which requires drugmakers to provide discounts on outpatient drugs to providers that serve low-income patients. Over the last few years, drugmakers have increasingly accused providers of using the program to generate profits, rather than distribute savings to patient care. Drug manufacturers have been involved in multiple lawsuits regarding how much the companies can limit discounts.

To read more about Sen. Cassidy’s investigation, CLICK HERE.

To read the study, CLICK HERE.

Second House Oversight PBM Hearing Sparks Potential Committee Legislation

On Tuesday, September 19th, the House Oversight & Accountability Committee held a second hearing on the role of Pharmacy Benefit Managers (PBMs) in prescription drug markets. During the hearing, representatives of brand and generic drug manufacturers and pharmacies testified in favor of PBM reforms, showcasing how PBMs have fallen short of their intended purpose. However, Democratic lawmakers also called out drug makers for their opposition to drug price controls in the Inflation Reduction Act (IRA), which are meant to bring down the costs of certain prescription drugs in Medicare.

“PBMs started out as beneficial additions to the healthcare system because they were competing with each other to provide clarity to pharmacies, payers, and patients about drug costs. But that environment of competition and transparency is no longer true today,” said Committee Chair James Comer (R-KY). Comer also suggested that the Oversight Committee may soon craft its own reform bill if the Lower Costs, More Transparency Act or other transparency bills do not advance.

Following the hearing, six pharmacy benefit manager companies – Navitus, SmithRx, AffirmedRx, Liviniti, MedOne Pharmacy Benefit Solutions and RxPreferred Benefits – established a lobbying coalition, entitled Transparency-Rx, to advocate for prescription drug price reform. The coalition backs a ban on spread pricing, reforms to the rebate model, and a pass-through model for discounts – policies that are likely to ruffle feathers among the industry’s biggest companies. However, many of these reforms are already underway in various bills. The coalition noted that it is working with bipartisan lawmakers and the Biden administration.

“We embrace critical reforms to a costly and misaligned drug pricing market. In fact, most of these reforms are already reflected in the business and innovations of transparent PBMs,” LeAnn Boyd, CEO of Liviniti, said in the press release.

To watch the Committee Hearing, CLICK HERE.

To learn more about Transparency-Rx, CLICK HERE.

ARPA-H Settles on Headquarters in DC, Massachusetts, and Texas

The Advanced Research Projects Agency for Health (ARPA-H), a multibillion-dollar innovation agency aimed at curing major diseases, recently announced that it will be housed in a “hub and spoke” model across the country. The main hubs will be located in the D.C. suburbs, Cambridge, Massachusetts, and Dallas, Texas, with additional locations at ten sites spanning from Florida to Alaska. ARPA-H will distribute a small amount of funding to each of the hubs for basic administrative activities.

“We are thinking ahead 10, 15 years from now, to create that ecosystem that is going to be required to catch ARPA-H technologies,” said Renee Wegrzyn, ARPA-H Director, said of the hub and spoke model.

The announcement comes after months of frenzied lobbying, as many regions aggressively sought to host ARPA-H. However, others have noted that a financial boom is more likely to be experienced by cities with universities or biotech companies that receive agency contracts, not in cities that host ARPA-H headquarters.

To read more, CLICK HERE.