Tag Archives: biosimilars

CMS Proposed 2018 Medicare Rules: What Lies Ahead?

By Leah Ralph, Director of Health Policy, ACCC, and Blair Burnett, Policy Analyst, ACCC

Healthcare costsHere in Washington, D.C., as we count down the days remaining in the Congressional August recess, the Centers for Medicare & Medicaid Services (CMS) has reminded us that big changes in healthcare are not limited to the political brinkmanship of ACA repeal. On July 13, 2017, the agency released its CY 2018 proposed Hospital Outpatient Prospective Payment System (OPPS) and Physician Fee Schedule (PFS) rules. The proposed OPPS rule was the big news this year, signaling major changes may be in store for hospital reimbursement in 2018. The agency is proposing significant reduction in payment for drugs purchased under the 340B Drug Pricing Program and for 2018, CMS is proposing further reimbursement reductions for new off-campus provider-based departments (PBDs).

Holy OPPS!
The 340B Drug Pricing Program, created in 1992, requires drug manufacturers to provide outpatient drugs at a discounted price to eligible healthcare facilities who are generally providing care to a certain percentage of indigent patients. While the 340B program has grown, and reform has been widely debated by policymakers over the past decade, CMS’ rule proposes to fundamentally alter the way providers will get reimbursed for drugs purchased through the program. It’s worth noting though that 340B oversight is under the jurisdiction of the Health Resources & Services Administration (HRSA), an agency of the U.S Department of Health and Human Services, and not under CMS purview.

For 2018, under the OPPS CMS proposes to reduce Medicare reimbursement for separately payable drugs without pass-through status purchased through the 340B Program from average sale price (ASP) plus six percent to ASP minus 22.5 percent. Further, because CMS cannot currently identify 340B drugs in Medicare OPPS claims data, CMS also proposes to require that hospitals submitting claims for separately payable drugs not acquired through the 340B program use a modifier on the claim to be reimbursed at ASP plus six percent.

Medicare’s HOP Panel Weighs In
ACCC continues to work through the details of the proposal and meet with policymakers and other stakeholders to put forward meaningful, workable solutions for reforming the 340B program. Most recently, on August 21, ACCC and other stakeholders testified at Medicare’s Advisory Panel on Hospital Outpatient Payment (HOP) meeting, outlining the deleterious impact this proposal would have on cancer programs participating in the 340B program. (ACCC also testified against the agency’s proposal to related to packaging Level 1 and 2 drug administration services, more on this below.) At the conclusion of the meeting, the HOP Panel voted to recommend to CMS that the agency drop the current proposal to cut 340B payments.

To learn more about CMS’ proposal and ACCC advocacy efforts, join us in Nashville, Oct. 18-20 at the 34th ACCC National Oncology Conference.

And There’s More
Another significant proposed change relates to packaging of drug administration services. Currently CMS excludes packaging of low-cost drug administration services (i.e., costing less than or equal to $100) from the ancillary services packaging policy. For 2018, the agency is proposing to package Level 1 and 2 drug administration services when these services are performed with another separately payable service, but pay for them separately when performed alone. CMS believes that this “conditional” packaging of drug administration services will promote equitable payment between physician offices and hospital outpatient departments. ACCC disagrees with the agency’s rationale and will be urging CMS not to finalize this policy.

Opportunity to Comment on 14-Day Rule
In the 2018 proposed OPPS rule, CMS is also soliciting comments on the “14-Day Rule.”  This is a policy that determines when a hospital may bill Medicare for a clinical diagnostic laboratory test versus when the laboratory performing the test may bill Medicare directly. CMS is considering potential modifications to the “14-Day Rule” that would allow labs to bill Medicare directly for molecular pathology tests and advanced diagnostic laboratory tests. ACCC played an active role in requesting that this policy be reopened for public comment.

Moving to the Proposed 2018 PFS Rule: CMS Proposes Change to Site-Neutral Payment
For 2018, CMS is proposing to further reduce reimbursement for non-excepted off-campus provider-based departments (PBDs). [Notably, this provision is included in the PFS proposed rule, despite impacting facilities traditionally billing under the OPPS, because in 2017, the PFS was the “applicable payment system” for these non-excepted PBDs and CMS reimbursed them under the PFS at non-facility rates.] Read on for details.

In the 2018 PFS  rule, CMS  proposes to significantly change last year’s site-neutral payment policy and further reduce reimbursement for non-excepted off-campus provider-based departments (PBDs). In general, these are entities that began billing Medicare as an off-campus PBD after November 2015.  For these non-excepted PBDs, the agency is proposing to decrease payment from 50% to 25% of OPPS rates. The agency is basing this proposed rate reduction on a comparison of payment rates for clinic and office visits under both payment systems (i.e., the OPPS and PFS). CMS expressed concern that paying 50% of the OPPS rate might result in payments for items and services that are greater than would otherwise be paid to physician offices under the PFS. Early analysis by ACCC, however, shows that reimbursement at 25% of OPPS will be well below PFS rates for certain services.

Of note: In the proposed rule, CMS does not address whether the payment reduction for drugs acquired under the 340B Program or the modifier for drugs not acquired under that program would apply to these non-excepted office-campus provider-based departments

More on the 2018 Proposed PFS Rule
While, overall, the Physician Fee Schedule was fairly quiet this year, one notable provision is CMS’ approach to payment for biosimilars. For 2018, the agency is proposing to continue its approach (from 2016) that biosimilars will generally share a single HCPCS code and that these products will be grouped into the same payment calculation for the purposes of determining a single ASP payment limit. While CMS isn’t officially opening this policy for comments, the agency requests feedback on how this already-implemented policy will impact the ability to create a competitive marketplace and encourage innovation in the biosimilars market.

Big Picture
Overall, CMS estimates that OPPS payments will increase by nearly two percent next year (except for the impact of the 340B proposal), while under the proposed PFS, payment rates will see no change for hematology/oncology and a one percent increase for radiation oncology in 2018.

Let Us Hear From You
CMS is taking comments on both the OPPS and PFS CY 2018 Proposed Rules through Sept. 11, 2017, and, importantly, also seeking open-ended comments from the public on policies that would maintain flexibility and efficiencies in the Medicare program while reducing unnecessary burdens for clinicians and patients. ACCC is busy drafting its comments and we want to hear from you. Please contact Leah Ralph, Health Policy Director, at lralph@accc-cancer.org with your input. We also encourage you to submit comments directly to CMS at regulations.gov.

 

Policy Summit Focuses on Biosimilars & Molecular Testing

By Brittney Fairman, Policy Analyst, ACCC

On Friday, September 16, the National Comprehensive Cancer Network (NCCN) held a policy summit at the National Press Club in Washington, D.C., on Developments in Biosimilars and Molecular Testing. ACCC was in attendance to hear oncology experts from across the country discuss topics ranging from the clinical implications to the regulation of biosimilars and molecular testing in oncology.

Discussions at the summit  also touched on the latest developments, trends, and future implications for both biosimilars and molecular testing, as well as maximizing patient outcomes and overall readiness for real-world applications in the clinical setting.  Look for an article from NCCN on the summit in the coming months.

Across the summit presentations some overarching themes surfaced regarding biosimilars and the rapid developments in molecular diagnostics. In both areas, key discussions revolved around quality, utility and cost, with implications created by many factors including regulation policies, disjointed and disconnected data, patient expectations, and nuanced reimbursement issues. Three key takeaways centered around:

  • The importance of developing methods for capturing data in novel ways and improving on EMR information linking to create a data warehouse to aggregate quality outcomes data. Ultimately, these data could be used to support best patient outcome decisions.
  • The imperative to achieve collaboration from all stakeholders to foster robust investments in resources to enhance science and information technologies.
  • The need to revise payment paradigms to appropriately account for the total cost of care.

In general, policy arguments over biosimilars will eventually narrow as biosimilars begin to be looked at more and more as nearly generics. In turn, there will eventually be less cost in production, and regulations for clinical trials may begin to roll back. Finally, there will be an even bigger role for education for both patients and providers to level-set expectations and address current communication barriers.

There are real implications being created by the current structure of regulations, as they apply to both biosimilars and molecular diagnostic tests.  ACCC will be following developments closely and providing more updates as they come.

Meanwhile, for providers seeking to integrate molecular testing into practice, ACCC offers resources and tools for process improvements for molecular testing in the community setting.  Learn more.

 

 

2016 Medicare Payment Rules Finalized

Centers_for_Medicare_and_Medicaid_Services_logoBy Maureen Leddy, JD, Manager, Policy and Strategic Alliances, ACCC

The Centers for Medicare & Medicaid Services (CMS) on Oct. 30, 2015, released the final 2016 Physician Fee Schedule and Outpatient Prospective Payment System rules. With the exception of radiation therapy codes, the final rules align quite a bit with the proposed rules. A preliminary summary is included below. Stay tuned for detailed summaries and analysis on an upcoming ACCC members-only conference call on these 2016 final rules.

Highlights of 2016 PFS Final Rule

Radiation Oncology

In a noteworthy departure from the proposed 2016 PFS rule, CMS did not finalize new radiation therapy treatment payment codes. CMS responded to concerns expressed by ACCC and other stakeholder groups and delayed implementation of new radiation oncology codes, continuing use of current G-codes and values for 2016. However, the agency did finalize its proposal to increase the linear accelerator equipment utilization rate assumption from 50 percent to 70 percent over two years. CMS continues to seek empirical data on costs and usage of capital equipment, including linear accelerators.

Advance Care Planning

For 2016, CMS finalizes its proposal to establish separate payment for advance care planning services, consistent with the recommendations of the American Medical Association and other stakeholders, including ACCC. These new codes compensate providers for shared decision-making conversations at various stages of a patient’s illness.

Biosimilars

For 2016, CMS finalized its proposal to include all biosimilars of a reference biological product within the same billing and payment code. ACCC had commented against this proposal, raising concerns regarding traceability and administrative burdens expected with the use of a single code. While ACCC supports efforts to increase patient access to biologics, ACCC maintains that a system must be in place to track the specific biosimilar product used for each patient.

“Incident To”

CMS finalized its proposal to clarify requirements for billing for “incident to” services. CMS now formally requires that the physician or practitioner billing for “incident to” services must have directly supervised the auxiliary personnel providing these services. Addressing stakeholder concerns about the treating physician’s supervisory role in “incident to” services, the final rule clarifies that the supervising physician need not be the treating physician for billing purposes.

Highlights of 2016 OPPS Final Rule

CMS finalized its proposed cut in hospital outpatient payment rates of – 0.3 percent. Within this calculated –0.3 percent rate update is a –2 percent cut, applied due to the agency’s calculation of excess packaged payment for laboratory services in 2014. As a result of this year’s rate cut due to miscalculations in packaging policies, ACCC urged CMS to proceed cautiously with any additional packaging proposals to ensure future negative adjustments would not be necessary. However, CMS finalized its proposal to expand conditionally packaged services to include three new APCs: level 4 minor procedures, and level 3 and 4 pathology services. CMS notes that packaging of these services is consistent with the agency’s overall packaging policy.

Advance Care Planning

ACCC had also advocated for separate payment under advance care planning codes in the hospital outpatient setting. The 2016 OPPS final rule calls for conditionally packaging payment for these services, permitting separate payment in the hospital outpatient setting in limited circumstances.

Biosimilars

In the 2016 OPPS final rule, CMS finalized its proposals to pay biosimilars based on ASP+ 6% of the reference biologic product, and to allow biosimilars to be eligible for pass-through status. ACCC supported these proposals, noting that providing equivalent payment rates in the physician office and outpatient setting for biosimilars removes incentives to select one setting over another.

Two-Midnight Rule

CMS also finalized proposed changes to its two-midnight rule regarding hospitalization payment status. CMS will now allow certain patients not expected to meet the two-midnight stay requirement for inpatient status to still be classified as inpatient. CMS indicates that qualifying patients are those that require inpatient hospital care, as determined by the admitting physician and supported by the medical record, despite the expectation that their stay will last less than two midnights.

ACCC continues to analyze the 2016 payment rules and will update its members in the coming weeks.

 

Pre-Conferences Kick Off ACCC National Oncology Conference

by Amanda Patton, ACCC, Communications

OPEN Pre-Conference attendees listen to session on biosimilars

OPEN Pre-Conference attendees listen to session on biosimilars

Cancer care professionals from across the country are gathering in Portland, Oregon, this week for the ACCC 32nd National Oncology Conference.

Yesterday’s pre-conferences set the stage with sessions on oncology pharmacy issues and a program designed for administrators new to oncology.

One hot topic under discussion at the Oncology Pharmacy Education Network (OPEN) pre-conference: Institutional Review of Biosimilars. Jim Koeller, MS, PharmD, of the University of Texas at Austin, told attendees that “nationally, what we hope to create…we’re really trying to get to is a national standard on how biosimilars should be reviewed [by institutions].”  Until that time, what can P&T Committees do to be ready for institutional review? Setting up a subcommittee or working group for biosimilars is an important first step, Koeller  said.

While biosimilars will be less expensive, they will still be costly and reimbursement for biosimilars will “take a long time to figure out,” Koeller warned.

Key takeaways for oncology pharmacists and the oncology pharmacy:

  • Biosimilars are not generics: Use of biosimilars will require clinical review by a multidisciplinary team through the P&T Committee or other mechanism
  • A systematic review process will be necessary, looking at product, manufacturing, and institutional factors
  • Interchangeability is generally a state issue; keeping up with state laws will be essential.

A common theme across both pre-conferences: Oncology today requires multidisciplinary leadership.

“Almost everything in oncology practice is interdisciplinary,” said presenter John Hennessy, MBA, CMPE, in a New to Oncology session on Leadership and Organizational Structure. To succeed, oncology programs must have processes in place for identifying and training future leaders and aligning incentive across all team members, he said.

Stay tuned for more from the ACCC National Oncology Conference.  Follow the conference on Twitter at #ACCCNOC.

ACCC Responds to CMS on Proposed 2016 PFS Rule

By Leah Ralph, Manager, Provider Economics and Public Policy, ACCC

Centers_for_Medicare_and_Medicaid_Services_logoOn September 8th, ACCC submitted comments on CMS’ proposed 2016 Physician Fee Schedule rule. This year, the proposed PFS was released later than usual and contained a number of provisions that ACCC will be watching closely in the coming months.

Read on for a quick roundup of major provisions and ACCC recommendations to CMS:

Radiation Oncology Cuts

CMS proposes several significant changes to payment for radiation oncology procedures that would collectively result in drastic cuts for radiation oncology providers – an estimated 3% for radiation oncology and 9% for freestanding radiation therapy centers. CMS is proposing payment rates for new CPT codes that would effectively reduce Medicare reimbursement for IMRT and other radiation treatment delivery services. The agency also proposes to remove several essential direct practice expense inputs from the new radiation treatment delivery codes, including the on-boarding imaging equipment that is essential to providing safe and accurate radiation treatment. Finally, CMS proposes to adjust the equipment utilization rate assumption for the linear accelerator used in image guidance from 50% of available time to 70% of available time over two years, reducing reimbursement for services that make use of that equipment.

In our comments, ACCC expressed significant concern to CMS that these deep, simultaneous cuts in radiation oncology reimbursement will have the effect of forcing some cancer care providers, particularly those operating in rural and underserved areas, to close their doors. ACCC urges CMS to take the necessary steps to mitigate this threat, for example, by not implementing the proposed increase in the equipment utilization rate. ACCC will be monitoring this closely and stands ready to work with CMS to find ways to implement any appropriate changes over a period sufficient to allow providers to absorb the changes while not compromising access to critical radiation oncology services.

 Biosimilar Reimbursement

CMS proposes a payment methodology for biosimilar products in which all biosimilars with the same reference product would be assigned a single HCPCS code and reimbursed based on the volume-weighted average sales price (ASP) for all products under the code plus 6% of the reference product’s ASP.

ACCC asks CMS not to finalize this proposal. We expressed concern that assigning multiple biosimilar products a single HCPCS code would create new and unnecessary administrative burdens for physicians and other providers when treating patients with biosimilar products, as they would not only need to enter the HCPCS code into the medical record, as they do now, but also the specific biosimilar therapy used for the patient. Additionally, this approach could significantly impede effective tracking of safety information and other information about the patient experience with specific biosimilar products—after these enter the market. We urge CMS to promote effective tracing of safety information and to minimize administrative burdens on providers who prescribe biosimilars.

 Advance Care Planning

CMS proposes to establish payment rates for the two CPT codes adopted by the AMA CPT Editorial Panel to describe advance care planning services. ACCC strongly supports this proposal and asks that the payment rates for these services adequately reflect the cost to physicians of providing advance care planning.

As ACCC believes advance care planning services are equally important in the hospital outpatient setting, where they also take substantial time and resources and contribute significantly to the quality of patient care. In our comments to the proposed 2016 Outpatient Prospective Payment System rule, we urged CMS to pay separately for these two CPT codes in the outpatient setting as well.

Chronic Care Management

CMS recognizes that Medicare’s payment rates for the CPT codes for transitional care management (TCM) and chronic care management (CCM) do not fully account for the cognitive work that primary care physicians and other practitioners perform in managing and delivering care, particularly to chronically ill beneficiaries. CMS identifies add-on codes as one potential means of establishing payment rates that appropriately value the additional time and intensity of physicians’ cognitive work often involved in delivering care management services. ACCC encourages CMS to develop such codes, and to work with ACCC and other provider organizations to ensure that any new add-on codes are structured and valued appropriately.

ACCC also has concerns related to CMS’ proposal for chronic care management in the 2016 OPPS proposed rule. On the hospital outpatient side, CMS is proposing to permit only one hospital to bill for CCM services during a calendar month. ACCC points out to CMS that because cancer care is highly multidisciplinary, it can be difficult to agree upon who should be the designated CCM physician, and we are concerned that CMS’ rules for these services already make it very difficult for hospitals to seek payment for them. We urge CMS to continue to consult with hospitals and physicians on the best way to determine which entities should bill for these services.

“Incident To” Services

CMS proposes to require that the physician or other provider who bills for an “incident to” service must also be the physician or other provider who directly supervises the auxiliary personnel in providing that service. If CMS were to finalize this proposal, ACCC urges the agency to provide education to physicians and other providers on the revised requirement to ensure providers do not experience unwarranted disruption in billing for appropriate “incident to” services.

CMS is expected to finalize the 2016 Physician Fee Schedule rule in late October. Stay tuned, as ACCC will keep members updated as CMS revises and finalizes these important proposals.

Proposed 2016 Medicare Rules

Centers_for_Medicare_and_Medicaid_Services_logoBy Leah Ralph, Manager, Provider Economics and Public Policy, ACCC

The Centers for Medicare & Medicaid Services (CMS) 2016 proposed rules are out, and, not surprisingly, we continue to see the agency push outpatient payments toward more bundled services and move full steam ahead to tie Medicare payments at large to quality and value in the coming year.

2016 HOPPS Proposed Rule

Generally speaking, the proposed Hospital Outpatient Prospective Payment System (OPPS) rule includes few surprises, most notably CMS is proposing a -2% across-the-board reduction to compensate for “excessive” packaged payments for laboratory services in CY14. The rule also includes nine new comprehensive ambulatory payment classifications (C-APCs) to add to the 25 introduced last year and proposes consolidation and restructuring of nine APC clinical families. Importantly, CMS will continue to reimburse drugs at ASP+6% in the hospital outpatient department. The agency also provides some flexibility on the “two-midnight” rule. Currently the rule requires that a beneficiary to remain in the hospital for longer than two midnights in order for the stay to be reimbursed as an inpatient stay. Under the proposed rule, CMS would recognize some shorter stays as inpatient, and would evaluate on a “case-by-case” basis.

 2016 PFS Proposed Rule

The proposed Physician Fee Schedule (PFS) rule was released later than expected this year, perhaps due to slightly more contentious provisions. The good news – perhaps – is that, as proposed, the 2016 PFS would have no (0%) impact on Medicare payments in hematology/oncology. However, on the radiation oncology side the news is not so good. If all of the proposals in the rule are finalized, radiation oncology will face an estimated -3% cut and freestanding radiation therapy centers will see a -9% cut due to a combination of new code values and a change in assumption involving the overall use of linear accelerators. CMS also indicates how it will treat biosimilars for the purposes of Part B reimbursement, proposing to assign the same HCPCS code to all biosimilars that reference the same innovator drug. These would be paid based on their volume-weighted ASP+6% of the reference product’s ASP. If no ASP data is available, biosimilars would be reimbursed at 100% of their wholesale acquisition cost.

Under the PFS, CMS also proposes to create two new CPT codes for advanced care planning services, one to start the conversation with a patient and the other for continued discussion. The rule also begins the phasing out of the PQRS (the 2018 payment adjustment will be the last); adjustments for quality reporting will now be made under the new Merit-Based Incentive Program (MIPS), created by the legislation that repealed the Medicare Sustainable Growth Rate (SGR). CMS seeks comments on MIPS on issues like the definition of clinical practice improvement activities, how to define a physician-focused payment model, and more.

ACCC will be submitting comments on both rules, due August 31 and September 8, respectively. On Tuesday, July 21, 4:00-5:00 PM EST, ACCC is hosting a members-only conference call with a full rundown of both proposed rules. Stayed tuned.