Health Policy Report – September 10, 2024

The US Oncology Network Submits Comments on Physician Fee Schedule Proposed Rule

On Monday, September 9, The US Oncology Network formally submitted comments to the Centers for Medicaid and Medicare Services (CMS) Physician Fee Schedule Proposed Rule outlining concerns with another reduction in the conversion factor, following the 60-day comment period window.

In its comments, The Network described that years of payment cuts have contributed to market consolidation, particularly in oncology. “Payment policies that reimburse hospital-owned physician clinics (considered to be hospital outpatient departments) at rates that are significantly higher than independent physician clinics for the same services creates an unlevel playing field. Increasing payment to hospital-owned physician offices while decreasing payment to independently-owned physician offices increases costs in the short and long term to patients and the Medicare system,” The Network wrote.

The Network also expressed its support for a permanent, inflation-based update to the Medicare Physician Fee Schedule. This need for reform has been echoed by others in the community oncology sector. “CMS’ payment policies do not keep pace with the costs of running an independent medical practice, and they further drive medical care into the much more expensive hospital setting,” Ted Okon, Executive Director of the Community Oncology Alliance (COA), said in a recent interview.

Physicians across specialties have expressed similar concerns. In a recent letter, The US Oncology Network, American College of Radiology, and other groups called on Congress to enact long-term reform and ensure payment stability for physicians. “Congress must act before the end of 2024 to provide clinicians with the financial stability needed to ensure beneficiaries continue to have access to high-quality care,” the letter read.

The Network’s comment letter went on to address CMS’ proposals on telehealth services, payment for radiopharmaceuticals in the physician office setting, CAR-T therapy services, and colorectal cancer screening.

The Network expressed support for billing codes to account for care coordination services provided by patient navigators under new principal illness navigation (PIN) payments. However, it expressed the need to minimize additional administrative burden. “However, there is significant burden on the clinician associated with completing the initiating steps and on the patient to gain access to services and we caution that this burden should not outweigh the benefits and reimbursement. The Network believes streamlining these processes is essential to ensure that patients receive the care they need without unnecessary obstacles,” the letter read.

CMS will now review the comments submitted by stakeholders and will release the final rule later this fall, typically around November.

To read The Network’s comments, CLICK HERE.

To read the American College of Radiology’s letter, CLICK HERE.

To read more about long-term Medicare physician pay reform, CLICK HERE.

 To read more about new patient navigation billing codes, CLICK HERE.

Dr. John Schuler Pens Letter in The Oregonian on Threats to Independent Medicine

Dr. John Schuler, radiation oncologist at Compass Oncology, recently penned a letter to the editor (LTE) in The Oregonian describing the impact that Oregon Ballot Measure 118 would have on the state’s community oncology practices. If passed, Measure 118 would impose a 3% gross receipts tax – a tax on gross revenue, rather than profits – on Oregon businesses, including independent medical practices. 

In his letter, Dr. Schuler thanked Oregon lawmakers who have opposed this measure and explained how the proposal fails to recognize the distinction between medical clinics and traditional businesses. “While other businesses may pass this tax on to consumers, independent oncologists cannot pass this on to our patients – nor would we want to. The crushing tax burden of Measure 118 would force independent oncology practices to restrict the number of government-insured patients we see, limit the hiring of new staff, reduce patient support services or even be absorbed by larger hospital systems, which often charge more for care and are less convenient for patients. Nobody wants this worst-case scenario,” he wrote. 

Dr. Schuler concluded by urging Oregonians to vote against the measure in November. 

To read the piece, CLICK HERE. 

Texas Oncology – Odessa Hosts Congressman August Pfluger for Site Visit

Texas Oncology recently hosted Congressman August Pfluger (R-TX) at the Odessa West Texas Cancer Center to learn more about community oncology, value-based care, and patient access to clinical trials.

During the site visit, Congressman Pfluger toured the pharmacy, infusion suite, and new construction work on the radiation vault while meeting with several physicians, nurses, and support staff.

The tour, led by Drs. Kaczor, Khandelwal, Borra, and Tammi Mermis, allowed Congressman Pfluger to gain insights into the critical role community oncology is playing in providing high-quality, value-based care to West Texans. Congressman Pfluger represents Texas’s 11th District and serves on the House Energy and Commerce and Homeland Security Committees. The Network and Texas Oncology are eager to continue working with him to advance policies that support patient access to essential oncology services, clinical trials, and innovative treatments in the region.

To read more about Congressman Pfluger’s visit to Texas Oncology – Odessa, CLICK HERE.

HRSA Blocks Johnson & Johnson Proposal to Implement 340B Rebate Model 

Johnson & Johnson is reigniting controversy over the 340B drug pricing program after announcing that it would stop providing 340B discounts on two of its medications, plaque psoriasis treatment Stelara and blood thinner Xarelto. According to the plan, which is set to begin on October 15, the drugmaker will require hospitals to pay full price for the drugs and issue them a rebate later. Currently, drugmakers are required to provide 340B discounts at the time of purchase. 

“We believe this update will significantly improve program integrity while at the same time enabling covered entities to obtain the 340B price on eligible 340B sales,” J&J said in its notice.

In response to the announcement, the Health Resources and Services Administration (HRSA), which oversees the 340B program, notified Johnson & Johnson that the rebate model was “inconsistent with the 340B statute” and had not been approved by HHS Secretary Xavier Becerra. The American Hospital Association and America’s Essential Hospitals also pushed back, writing to HRSA that this rebate model is another example of a drug company squeezing hospitals and health systems. 

Drugmakers and hospital-based providers are perennially at odds over the 340B program, which requires drugmakers to provide discounts on eligible outpatient drugs at hospitals serving a large number of low-income patients. Drug companies and some patient advocates argue that the program has expanded beyond its intended purpose, noting that many 340B eligible hospitals provide insufficient charity care and fail to pass discounts on to patients. 

To read Johnson & Johnson’s announcement, CLICK HERE. 

To read more, CLICK HERE. 

To read the American Hospital Association’s letter to HRSA, CLICK HERE.

To read America’s Essential Hospitals’ letter to HRSA, CLICK HERE. 

Federal Judge Strikes Down FTC’s Noncompete Ban

A Texas federal judge struck down the Federal Trade Commission’s (FTC) nationwide ban on noncompete agreements just 15 days before the ban was set to take effect. Judge Ada Brown of the U.S. District Court for the Northern District of Texas ruled that the agency “lacks the authority to create substantive rules” for banning noncompete agreements, violating the Administrative Procedure Act and exceeding the agency’s statutory authority.

In April, the FTC approved a ban on noncompete agreements, which would invalidate existing noncompete agreements and prevent new contracts. Within healthcare, this noncompete ban was expected to help break restrictive contracts and increase job flexibility for physicians, nurses, and other medical workers.

Judge Brown stated that the ban is arbitrary within the meaning of the Administrative Procedure Act “because it is unreasonably overbroad without a reasonable explanation” for creating substantial rules precluding unfair methods of competition in employer contracts. In response, the FTC announced that it is “seriously considering” an appeal.

To read more, CLICK HERE.

FDA Rule on LDTs Faces Legal Challenges

The Association for Molecular Pathology (AMP) – a professional organization for molecular diagnostics professionals – and University of Texas pathologist Michael Laposata have filed a lawsuit over the FDA’s decision to regulate lab-developed tests (LDTs). The move marks the first legal case on the issue to cite the Loper Bright Enterprises v. Raimondo ruling following the Supreme Court’s overturn of the Chevron doctrine, which did away with courts’ deference to federal agency interpretations of ambiguous laws.  

In May, the American Clinical Laboratory Association (ACLA) and its member company HealthTrackRX filed the first lawsuit in May over the Food and Drug Administration’s (FDA) LDT final rule, which was issued earlier in the year. 

AMP writes that “courts must ‘exercise their independent judgment in deciding whether an agency has acted within its statutory authority’ and ‘may not defer to an agency interpretation of the law simply because a statute is ambiguous,’” citing Loper Bright.

To read more about the lawsuit, CLICK HERE. 

Community Oncology Experts Offer Favorable View of Enhanced Oncology Model (EOM)

During a panel organized by the Community Oncology Alliance, community oncologists reported that the Centers for Medicare & Medicaid Services’ (CMS) changes to the Enhanced Oncology Model (EOM) offer more flexibility for providers, including improved compensation and the ability to participate in an alternative advanced payment model (APM). 

The EOM, a successor to the Oncology Care Model (OCM), is built around 6-month periods of care or “episodes,” and practices are reviewed in 6-month performance periods. After only 44 practices signed on for the EOM in July 2023, CMS made substantial changes to ensure that practices could learn the nuances of the program before risking penalties. 

“It’s really encouraged us to reach out into different areas of care that we hadn’t spent as much time in, [and] develop new partnerships,” Abra Kelson, MSW, LICSW, support services manager for Northwest Medical Specialties, PLLC said about the program. 

To read more, CLICK HERE.