Healthcare professionals plan to fight new Medicare prescription model
U.S. Healthcare professionals plan to fight new Medicare prescription model. [Representational Image]Reuters

Just a day after President Barack Obama's administration released its Medicare Part B prescription drug model, many specialty physicians and other health care providers have launched efforts to derail the federal proposal for testing whether paying doctors should be paid less for the drugs they are administering.

The new plan, announced Wednesday by the Centers for Medicare & Medicaid Services (CMS), proposed a rule to test new models to improve how Medicare Part B pays for prescription drugs and supports physicians and other clinicians in delivering higher quality care.

The reactions from specialty doctors, drug-industry groups and Republican lawmakers to the proposal, however, suggest a major fight ahead against the proposal, as they describe the plan as ill-conceived, reported the Wall Street Journal (WSJ).

Dan Durham, executive vice-president for health policy of Biotechnology Innovation Organisation (BIO) — one of the largest trade associations for biotech, said in a statement, "...upon initial review we are gravely concerned that the model threatens to disrupt the successful reimbursement framework for drugs covered under the Medicare Part B program, particularly for rural and smaller provider groups."

The new model is designed to test different physician and patient incentives to drive the prescribing of the most effective drugs, and test new payment approaches to reward positive patient outcomes. Some of the tests will focus on elimination of certain incentives that work against the selection of high performing drugs as well as the creation of positive incentives for the selection of high performing drugs, including reducing or eliminating patient cost sharing to improve patients' access and appropriate use of effective drugs.

According to WSJ, some oncologists want the proposal withdrawn as they fear that the independent practices will fold, while some stated that their reimbursements from the drugs barely cover their costs.

The Community Oncology Alliance (COA), a non-profit focused on community oncology, in a letter sent to the Department of Health and Human Services, stated, "The CMS Medicare Part B Drug Payment Model is an inappropriate, potentially dangerous, and perverse experiment on the cancer care of seniors who are covered by Medicare." It was signed by Bruce B. Gould, MD, president of COA, on behalf of the COA Board of Directors.

The new plan has been criticised for having perverse incentives, as generally, under Part B, doctors are reimbursed the average sale price of a drug plus an additional 6 percent premium. The pilot model of Medicare Part B Drugs Payment model aims to change that as the reimbursement rate would be slashed by more than half, but with a new flat rate per prescription. That rate will drop to 2.5 percent under the model, with a flat payment of about $16.

Kevin Brady, Chairman of the House Ways and Means Committee; Fred Upton, Chairman of House Energy and Commerce Committee; and Orrin Hatch, Chairman of Senate Finance Committee, issued a statement, regarding the proposed changes to the Medicare Part B Drug Payment Model. It stated that "the decision was made with a complete lack of transparency and clear disregard for the people and stakeholders who will be impacted the most." The Republicans also said that it "could ultimately result in seniors' receiving different standards of care based solely on where they live in the country."

According to the statement issued by CMS, the proposal is part of the administration's broader strategy to encourage better care, smarter spending, and healthier people by paying for what works, unlocking health care data, and finding new ways to coordinate and integrate care to improve quality.

Stressing that the plan was still in the early stages, Andy Slavitt, the acting administrator of CMS, said, "There is nothing that we propose to do, or should do, in any way, that prevents a patient from getting a prescription medicine that they need," The Hill reported. She also added that the agency would be soliciting feedback for several months.