The biggest lobbyists for seniors and the pharmaceutical industry are fighting over an experiment to drastically reform how Medicare pays doctors.
AARP, the biggest senior lobbying group, said Monday it supports the Obama administration’s experiment to overhaul the payment model for Medicare Part B to ensure doctors prescribe cheaper drugs to patients. The proposal has received significant pushback from the pharmaceutical industry, cancer patient advocacy groups and many Republican lawmakers.
AARP said in comments on the proposed rule that were due Monday that seniors need relief from high drug prices.
“Given prescription drug price and spending trends, it is imperative that policymakers find ways to ensure that treatments are chosen based on how well they work and not their price tag,” the group said.
Medicare Part B reimburses items such as doctor visits and it reimburses doctors for drugs administered in a healthcare setting. An example is chemotherapy treatments that aren’t taken at home.
Currently a doctor gets back the average sales price of a drug and an additional 6 percent. AARP said that extra 6 percent incentivizes doctors to prescribe more expensive drugs to get more money.
“The payment amount does not vary based on the price an individual provider or supplier pays to acquire the drug,” AARP said. “It also does not take into account the effectiveness of a particular drug or the cost of clinically comparable drugs.”
The Centers for Medicare and Medicaid Services has proposed changing that 6 percent add-on for all Part B drugs to 2 percent and a small fee of $16 per drug.
AARP is one of several allies of the White House in its effort to implement the model. Other key groups advocating for the experiment include the AFL-CIO labor federation and insurance giant Aetna.
Since the proposal has been released, the pharmaceutical industry, congressional Republicans and cancer advocacy groups have criticized it. The main concern, according to the groups, is that it will prevent patients from getting treatments they need.
The American Cancer Society’s lobbying arm issued comments Monday that said smaller oncology practices are on the decline, hurting access especially for rural cancer patients.
The experiment may “result in more oncologists leaving their practices, further exacerbating beneficiary access to needed cancer care,” the society’s Cancer Action Network wrote.
Oncologists may leave practices because of “significant reductions in reimbursement” for some cancer drugs, the society said.
That could force cancer patients to get care in “higher-cost, less desirable settings like hospital outpatient departments.”
The pharmaceutical industry also has vehemently opposed the experiment. The leading industry lobbying group, Pharmaceutical Research and Manufacturers of America, said the current Medicare Part B payment model already controls costs.
“Part B medicines represent a small and stable share of overall Part B spending, and price growth for Part B drugs is below overall medical inflation,” PhRMA said in a March statement.
Congressional Republicans have pushed hard against the experiment. A recent letter from 242 House lawmakers blasted the proposal, with top House leaders saying that it would hinder doctors’ choices for what is right for their patients.
The lawmakers also said the reimbursement cuts could lead physicians to refer patients to hospital outpatient departments instead of delivering the care themselves.
“Driving more care to an often less convenient, more costly setting makes it more challenging for beneficiaries to access needed care,” the letter said. “This will lead to further consolidation and less choice for patients.”
CMS has repeatedly said that the policy won’t hinder access to drugs for patients. The agency pointed to a new appeals process for doctors to overrule a CMS reimbursement decision.
“The proposal was to try to remove the financial consideration from the prescribing of medicines,” CMS Deputy Administrator Patrick Conway said during a recent briefing with reporters.
