By Sydney Abbott, JD, Manager, Provider Economics and Public Policy, ACCC
The failed debt negotiation talks of 2011 led to the 2% across-the-board Medicare sequester that has been squeezing the oncology community since CMS implemented it in April 2013. Shortly after the sequester began, ACCC surveyed its membership across varying sites of care and found that close to 60% of respondents reported being impacted by the 2% reduction in Medicare reimbursement. In October, when sequestration hit the six-month mark, ACCC conducted a follow-up survey of its membership to see how cancer programs were coping and if the picture painted at the start of the sequester still stood. The results of the follow-up survey highlight some interesting points about how the sequester is impacting community oncology care.
Two-thirds of survey respondents report being impacted by the sequester. Of those impacted, 84% are making adjustments to operating expenses, including reducing staff hours or not replacing staff when they resign. The follow-up survey results show the fastest growing area seeing cuts is non-revenue-generating programs, such as patient navigation services. Reducing these services hinders the quality of care for all cancer patients since these programs help patients with financial, dietary, cultural barriers, health literacy and other needs. These programs assist all patients in a cancer program; therefore, it is not surprising that 75% of respondents said the sequester is impacting every one of their patients, even though the 2% reduction in reimbursement is applied only to Medicare claims. This is an increase of 15% from the initial survey, showing that some of the broader implications of sequestration are just beginning to surface.
Interestingly, in the follow-up survey, of those who had not yet made changes, one-quarter responded that they did not expect to make changes in the future, as compared to 14% in the earlier survey. This may be good news indicating that more cancer programs are finding ways to adjust to these reimbursement reductions without making changes to patient care.
These results show that many ACCC members are resourceful and are coming up with innovative solutions to continue to care for their patients. However, overall, the results of these surveys show that more cancer facilities are being negatively impacted as a result of the 2% cut to Medicare reimbursement through sequestration, and that the cuts have impacts far beyond Medicare patients—they extend to all patients, to staff, and to supportive care programs. Providers are at the end of their rope—community oncology care cannot be cut further and the sequester must be reversed to preserve patient access to the supportive care services that relieve barriers to care, increase value, and help reduce long-term costs.
Please contact your legislators to let them know how the sequester is impacting you and your patients. ACCC will continue to encourage Congress to protect patient access to care by protecting community cancer care reimbursement.
by Sydney Abbott, JD, Manager, Provider Economics and Public Policy, ACCC
1) There is now bipartisan, bicameral legislation to reform the sustainable growth rate (SGR) that does not give Congress sticker shock; and
2) The U.S. Department of Health and Human Services (HHS) has declared that that it does not consider health insurance plans and other related federal subsidies that are offered through the new insurance exchanges, to be federal healthcare programs.
The House Energy & Commerce, Ways & Means, and Senate Finance Committees have worked together to introduce policy to repeal the flawed SGR formula with stable payments and quality-based incentive payments moving forward. Energy & Commerce was the first to introduce legislation in September, but the Congressional Budget Office (CBO) estimated the bill would cost $35 billion more over 10 years than the CBO’s most recent scoring for an SGR fix. Now, the Ways & Means and Senate Finance Committees have introduced new legislation more in line with the CBO’s anticipated costs.
This proposed legislation would prevent the 24.4% cut to reimbursement – which is currently set to go into effect on Jan. 1, 2014, unless Congress steps in. Under the new legislation, the SGR formula would be replaced with a pay freeze for the next 10 years. The proposal, which is still in discussion draft form, calls for gradually replacing Medicare’s existing fee-for-service payment system with a “value-based performance system” focused on medical outcomes rather than procedures. This means there will be financial incentives to participate in alternative payment models. Under the draft legislation, it’s possible that reimbursement could be adjusted based on performance as soon as 2017. The bill relies on the Physician Quality Reporting System (PQRS), the value-based modifier, and the EHR Meaningful Use Program – currently penalty-only systems – to create incentive payments for high-quality care. In addition, the proposed legislation would keep the penalty portion of these programs to help fund the incentive payments.
We can all agree that the current SGR formula is fundamentally flawed and that a new reimbursement system is necessary. The CBO has estimated the cost of “freezing” physician Medicare payments for 10 years at $138 billion. While this is a relative bargain in congressional terms, Congress still faces an uphill battle to find the funds to replace the SGR. To date, the draft legislation addresses the policy behind SGR reform only; the battle to identify a ‘pay-for’ has not yet begun.
Exchange Plans Not Federal Programs
With the new insurance exchanges, there has been much confusion concerning whether drug manufacturers would be able to continue certain patient assistance programs because it was unclear whether the new insurance exchanges and their related subsidies were considered federal programs. Generally, drug manufacturers can provide copay assistance to patients who are unable to afford their medication so long as they are not in receipt of assistance through a federal program. Although the insurance plans purchased through the exchanges are private, the fact that they are being offered through a federal marketplace and federal funds are available to offset the cost of premiums led to many unanswered questions. Many drug manufacturers wondered if they would be able to continue to offer patient assistance programs to these needy patients.
Thankfully, in a letter to Congressman Jim McDermott, HHS clarified that qualified health plans and related federal subsidies are not considered federal programs for the sake of manufacturer copay assistance programs. This is great news. The clarification means that drug companies may continue to offer the much needed assistance that many low-income patients have come to rely on.
So forget about the federal government shut down, looming debt ceiling, and other congressional woes for a few minutes. With Thanksgiving approaching, let’s be thankful for a few of the bright spots coming from Washington and, for the moment at least, view the glass as half full.
By Sydney Abbott, JD, Manager, Provider Economics and Public Policy, ACCC
The federal government is back in business. On Wednesday evening of this week, the House and Senate passed a continuing resolution to fund the government through January 15, 2014, and raise the debt ceiling until February 7, 2014. So, the shutdown is over, but Congress essentially just kicked the can down the road—and not very far.
The good news? Funding for new clinical trials will be restored and the Centers for Medicare & Medicaid Services (CMS) will get back to writing the final rules for the 2014 Physician Fee Schedule (PFS) and Hospital Outpatient Prospective Payment System (OPPS). However, funding has been restored at post-sequestration levels, and the conversation continues about how this is impacting community cancer care. It’s also possible that the three-week government shutdown may cause a delay in CMS’s release of the final rules, which would mean less time for implementation of the new policies that go into effect on January 1, 2014.
What about hopes for SGR reform? With less than two months remaining in 2013 and Congress focused on little besides the budget and debt ceiling, hopes of passing reform this year are slipping away. This means we are looking at the probability of yet another last-minute “Doc Fix” to stave off the anticipated 25% cut to Medicare reimbursement created by the flawed SGR formula. This year, many in the advocacy community believed that the timing was ripe to finally do away with the SGR given the CBO’s low budget score and the fact that the House Energy & Commerce, Ways and Means, and Senate Finance Committees all drafted legislation. While there is an outside chance that SGR repeal could get looped into a larger budget deal, the current SGR repeal legislation is expected to cost $175 billion over 10 years and no offsets have yet been identified, so Congress will likely wait another day to take on that fight.
Déjà vu all over again? Come January we may see ourselves in the same situation from which we just emerged: partisanship and political gridlock threatening another shutdown. While the conversation on the Hill continues to be budget-driven, ACCC will continue to work with members of Congress to preserve provider reimbursement and access to care for patients. We will be participating in a Hill day next week with other members of the cancer advocacy community to request adequate funding for cancer research and other programs. Please stay tuned for updates.
By Sydney Abbott, JD, Manager, Provider Economics and Public Policy, ACCC
As you undoubtedly already know, we are in the third week of the government shutdown due to Congress’s inability to agree on a continuing resolution (CR) to fund discretionary spending. This means that discretionary spending has stopped, but mandatory spending for things that protect life, property, and entitlements continues on an automatic basis. What does this mean for cancer care providers?
1) At least in the short term, Medicare reimbursement will continue as usual (at post-sequestration levels).
2) The National Institutes of Health (NIH) will continue with clinical trials currently in progress, but will not begin any new trials until funding is restored.
3) The U.S. Food and Drug Administration (FDA) has furloughed a number of workers, which could slow the approval of new drugs if there is a prolonged shutdown.
The federal government is expected to hit the debt ceiling—the point at which the country cannot borrow new money—on October 17. Speaker Boehner has committed to not reaching the debt limit, even though the House and Senate are still unable to reach a deal that pleases everyone. Some members of the House Tea Party remain committed to only voting in favor of funding if implementation of the Affordable Care Act (ACA) is delayed. Current negotiations would fund the government through the middle of January, and raise the debt ceiling through the middle of February; barely enough time to catch a breath before the threat of shutdown is upon us again.
While Congress continues to negotiate the government’s budget and borrowing limit, other important legislation waits on the sidelines. The status of the sequester remains of specific interest to the oncology community. ACCC continues to support HR 1416, legislation that would exempt cancer drugs from the Medicare sequester. This legislation is becoming increasingly important not only because of its 108 bipartisan cosponsors, but because of the current political climate. Congress is in a deficit-reduction mindset. While they understand that the sequester is a blunt budgetary tool which impacts oncology providers in a particularly unfair manner, they are reluctant to eliminate the sequester because it is saving the government money. In other words, Congress views the sequester as the new normal and proved this by only introducing budget bills with post-sequestration spending levels.
Cancer care providers, please complete ACCC’s follow-up sequester impact survey so we can show how the two percent Medicare sequester is impacting you and your ability to care for patients. As always, ACCC will keep members up to date on this important matter.
By Matt Farber, MA, Director Provider Economics and Public Policy, ACCC
On Friday, September 6, ACCC formally submitted comments to the Centers for Medicare & Medicaid Services (CMS) on the 2014 Physician Fee Schedule and the Hospital Outpatient Prospective Payment System proposed rules. ACCC has numerous concerns about proposals included in each of the rules, and the public comment period is an important opportunity to voice those concerns. If CMS does not hear from organizations such as ACCC, the agency may believe that its proposals will not adversely impact community oncology. Some of the key issues we focused on in our comments are outlined below.
Physician Fee Schedule. In its comments, ACCC asked that CMS:
- Work with Congress to develop a long-term fix to the Sustainable Growth Rate (SGR) formula and avert a 24.4 percent reduction to the conversion factor in 2014;
- Work with ACCC to study the issue of payment for services rendered in off-campus hospital-based departments;
- Apply adjustments to the work relative value units (RVUs) instead of the conversion factor to reflect changes in the Medicare Economic Index (MEI);
- Exercise caution when reviewing codes it identifies as potentially misvalued;
- Implement the proposal to create a new G-code for complex chronic care management services that meet certain standards; and
- Not implement the proposed cap on PFS non-facility payments using facility rates calculated under the Hospital Outpatient Prospective Payment System (OPPS) or Ambulatory Surgical Center (ASC) payment systems.
ACCC has great concern about the proposal to cap the PFS payments using rates from the hospital outpatient department or ambulatory surgical center settings. Our concern is that, for some codes, CMS is reducing payments based on procedures that are rarely given in certain sites of service. CMS also proposes to apply the cap when as little as five percent of the total volume of services are furnished in the hospital outpatient setting. Analysis of the proposed rates indicates that CMS often set the cap using ASC rates, even though the volume of services in that setting was far below five percent. This extremely low threshold does not help ensure that the capped rates accurately reflect typical costs for providing the service in either the physician office or facility setting. Further, when the Medicare Payment Advisory Commission (MedPAC) recommended that CMS cap certain hospital outpatient payments at the rates applicable in physician offices or ASCs, it recommended a threshold of 50 percent of claims in the setting used to establish the cap to ensure that payment rates are sufficient to protect access to care. ACCC believes that CMS’s proposal is unnecessary, and we are asking the agency to provide justification for its choice of site of service for setting payments.
OPPS Proposed Rule. ACCC asks that CMS:
- Implement the proposal to reimburse hospitals for the acquisition cost of separately payable drugs at ASP+ 6%;
- Make separate payment for all drugs with HCPCS codes, or, at a minimum, not increase the packaging threshold for drugs;
- Not implement the proposal to change the calculation for payment rates of computed tomography (CT) scans and magnetic resonance imaging (MRI);
- Not implement the proposal to consolidate clinic and emergency department evaluation and management (E&M) codes from five levels to one level; and
- Not implement the proposal to expand packaging for additional items and services until the agency corrects the significant errors and inconsistencies in the proposed rates, provides opportunity to comment on the corrections and clarifications, and reviews those comments.
In the 2014 proposed OPPS rule, CMS made some drastic moves to increase the amount of bundling in the hospital outpatient department. ACCC believes that the proposals will adversely impact cancer care. Of particular concern are proposals for the consolidation of E&M codes, changes to the calculation for payment rates of CT and MRI, and additional packaging of drug administration services. Added to these concerns is the fact that ACCC and other organizations believe there are significant errors in the proposed rates. We fear that these errors would further decrease reimbursement to critical areas of oncology care. Included with ACCC’s comments are memos from numerous experts that echo the same concerns about the validity of the data. The Hospital Payment Advisory Panel (HOP) agreed with ACCC and other stakeholders at its meeting last month, and recommended that CMS delay its proposals until the agency could verify these data. At a minimum, ACCC asks that CMS delay these proposals. Ultimately, however, it is our hope that CMS will listen to the stakeholders’ concerns and opt not to implement many of the packaging proposals.
We are reminded, once again, of the importance of public comments to these proposed rules. Unless ACCC and other organizations submit comments to CMS, these issues might never have come to light. If you are interested in learning more, or possibly submitting comments in the future, please contact me at firstname.lastname@example.org
By Sydney Abbott, JD, Manager, Provider Economics and Public Policy
On Tuesday, August 27, ACCC testified on the CY 2014 Hospital Outpatient Department (HOPD) proposed rule at the Centers for Medicare & Medicaid Services (CMS) Advisory Panel on Hospital Outpatient Payment (HOP). As you know, each year CMS releases the HOPD proposed rule and then allows 60 days for public comment. During this 60-day window, the HOP Panel meets to hear statements from the public and make recommendations based this testimony to CMS for the final rule.
Each year when the proposed rule is released various stakeholders and consultants feverishly work to model the proposed payment rates so that they can appropriately comment on CMS’s proposal. This year, however, for the first time since 2000, no one was able to mimic CMS’s proposal. As a result, ACCC and other stakeholders have been unable to comprehensively analyze the full implications of many of the proposals for 2014. Therefore, stakeholders testifying at the HOP Panel meeting largely spoke in unison asking CMS to not implement many of its proposals, at least until adequate time is given to analyze all data. Specifically, ACCC asked the panel to:
- Finalize the agency’s proposal to reimburse separately payable drugs at ASP+ 6%;
- Continue to make separate payment at ASP+ 6% for drugs without pass-through status that function as supplies when used in diagnostic procedures/tests or surgical procedures, restore separate payment for diagnostic radiopharmaceuticals and contrast agents without pass-through status, and to not increase the packaging threshold;
- Continue to make separate payment for all drug administration add-on codes;
- Continue to make separate payment for certain clinical diagnostic laboratory tests; and
- Continue to use five levels of HCPCS codes, assigned to five levels of APCs, to pay for clinic and ED visits.
We are pleased to report that the Panel listened to ACCC and others. The HOP Panel is recommending that CMS delay implementation of the 2014 proposals for comprehensive APC, expanded packaging, visit, and cost-center-based reimbursement changes for CT/MRI until data can be reviewed by the Panel at the Spring 2014 meeting that will look at the interaction between the proposals and their potential cumulative impact. The Panel also recommended that CMS postpone moving forward with collapsing the existing E/M visit CPT codes.
ACCC is thankful for the HOP Panel’s recommendations and will continue to work with CMS on these issues. CMS is expected to release the final 2014 Hospital Outpatient Department rule on November 1. The rule will become effective starting January 1, 2014. ACCC will keep members updated.
Congratulations ACCC members in Rhode Island! On Wednesday, July 17, your state became the most recent to sign oral parity legislation into law. This brings the total number of states with oral parity legislation to 26. In 2013, six states have passed oral parity legislation (Florida, Oklahoma, Massachusetts, Nevada, Utah, and now Rhode Island)—clearly oral chemotherapy parity legislation is gaining momentum among the states. See Oral Anticancer Treatment Access Map here.
By now you know that oral parity helps patients access their life-saving drugs by prohibiting private insurance plans from charging higher out-of-pocket costs for oral medications than for IV-infused medications. Cancer patients receiving IV-infusions through the physician office setting are covered under the medical benefit of their insurance plan, generally requiring about a $30 co-pay. However, patients on an oral chemotherapy regimen are covered under their pharmacy benefit, which often requires a cost-sharing component that is some percentage of the total cost of the drug. In the case of oral anti-cancer medications, that can be thousands of dollars out of pocket every month.
It has taken six years to get half of the states to pass these laws and Congress has yet to pass a federal measure, even though bills have been introduced in the past few years. So, why would anyone oppose such patient-focused legislation? There are a few common misconceptions about oral parity legislation that makes some legislators skittish:
- Given all of the controversy over the “personal mandate” in the Affordable Care Act (ACA), anything perceived as a mandate is given a bad name. Parity legislation is often viewed as mandating insurance plan coverage of oral therapies. However, this is not correct. Parity legislation, whether state-level or federal, only applies to health plans that already cover chemotherapy; there is no mandate to offer coverage for benefits not already provided.
- Oral chemotherapy drugs are much more expensive than their IV counterparts, so some believe oral parity legislation should not be supported in order to keep the total cost of healthcare down. This is not true when you take the whole picture into account. IV-infusion therapies involve additional costs such as facilities charges, nurse and/or physician time, and materials used to administer the therapy. It’s also important to consider the cost of time and loss of productivity for cancer patients who receive infusions and their caregivers. In addition, overall healthcare costs are higher if there are complications from administering an IV therapy, such as having to treat an infection at the site of infusion.
- Finally, some believe passing parity legislation would significantly raise insurance premiums for everyone. Studies conducted in states that have passed parity legislation, for example, Indiana, Texas and Vermont, show that any increases in insurance premiums are negligible.
ACCC continues to fight for oral parity legislation on both the state and federal level. While ACCC is pleased that six more states have passed parity legislation this year, we must be vigilant at the federal level, as well. State legislation only impacts individual health plans and small group plans that are not regulated by ERISA. Only federal legislation will cover patients participating in ERISA-regulated plans.
That’s why ACCC is joining forces with others in the oncology care advocacy community to fight for HR 1801, the federal oral parity bill, at today’s 2013 Patient Equal Access Coalition (PEAC) Hill Day.
ACCC asks its members to support this important bill. Click here to compose a message to your legislator in support of HR 1801.
On July 8, the Centers for Medicare & Medicaid Services (CMS) released the 2014 Physician Fee Schedule (PFS) and the Outpatient Prospective Payment System (OPPS) proposed rules. ACCC is currently reviewing the rules and preparing detailed summaries for its membership. On Wednesday, July 24, from 2:00 – 3:00 pm ET, ACCC will host a conference call for members to review the rules and their potential impact on community oncology. ACCC members should be on the lookout next week for an email with the call-in details for the conference call.
At first glance, what’s on the horizon for 2014? Not surprisingly, there are some positives and some negatives.
On the positive side, under the 2014 OPPS proposed rule, drug reimbursement will remain at the current level of ASP+ 6%. Under the 2014 PFS proposed rule, medical oncology will see about a 1% reduction in Medicare payments.
The news is less positive for radiation oncology, which faces a 5% cut in Medicare payments under the proposed 2014 Physician Fee Schedule. These cuts are due to several factors, including a change in the utilization rate for equipment—from 75 percent to 90 percent—that was mandated by the American Taxpayer Relief Act of 2012. CMS is also reviewing potentially misvalued codes, and the agency is seeking comments on how best to analyze the effects that consolidation has had on the Medicare system. As in both the proposed 2014 Inpatient Prospective Payment System (IPPS) rule and the proposed 2014 PFS, under the 2014 OPPS proposed rule radiation oncology will also see cuts. Most, if not all, of the APCs associated with MRI and CT testing will see double digit decreases in 2014. (Read ACCC’s comment letter to CMS on the IPPS 2014 Proposed Rule and Use of Separate Cost Centers for CT Scans and MRI Imaging here.)
Stay tuned for summaries and analysis from ACCC of the 2014 proposed PFS and OPPS rules. ACCC members, please join us on July 24 for our conference call on the rules.
A central focus of ACCC’s advocacy efforts is elimination of the federal spending sequester. As you know, the sequester, a $1 trillion dollar, across-the-board budget cut set up by Congress in 2011 as a deadline to encourage a successful negotiation of a $4 trillion spending cut by April 1, 2013, has now been in effect for several months, with no end in sight. Starting April 1, the Centers for Medicare & Medicaid Services (CMS) initiated a 2% cut in reimbursement to all Medicare claims.
In June, ACCC released the results of its survey on the impact of these cuts to its membership. Nearly 200 survey respondents, encompassing hospitals, physician offices, and shared operations, were asked if they had made any changes in care due to sequestration. Fifty-eight percent of respondents said yes. Of those, 78% said they were reducing operating expenses, including staff reductions, while 35% said they were referring patients to other sites of service. A full 61% reported that all patients, regardless of insurance, had their care impacted by these changes. ACCC is not alone in reporting that sequestration has negatively affected patient care. In a similar survey conducted by the American Society of Clinical Oncology (ASCO) 80 percent of survey respondents said that the sequestration cuts have affected their practices and nearly 50 percent reported not being able to continue caring for Medicare patients unless they have supplemental insurance.
Many members of Congress are aware of the grave problem these spending cuts pose for oncologists and patients alike. Central to the discussion during the June 28 Energy and Commerce Health Subcommittee hearing was HR 1416, the Cancer Care Patient Protection Act recently introduced by Congresswoman Renee Ellmers. This bill, which already has 91 House cosponsors from both parties, would eliminate sequestration on necessary chemotherapy drugs administered in the physician office setting and repay providers for any reduced payment since April 1. Chemotherapy is one of the services most heavily affected by sequestration. In ACCC’s survey 64% of respondents reported patients’ chemo infusions being affected. This bill would only remove the cuts to the fixed costs associated with Part B chemotherapy drugs, while leaving the cuts to more general services provided to cancer patients untouched.
ACCC proudly supports Representative Ellmers’ bill, and is actively working to introduce companion legislation in the Senate. In addition, we will continue to advocate for elimination of the sequester so that oncologists get the reimbursement they need to continue to provide quality care for all of their patients. Treating cancer is hard enough. We must end government sequestration as soon as possible and find solutions to the nation’s financial dilemma that do not penalize providers or patients.
Please urge your representative to support HR 1416 and let your senators know you want companion legislation introduced in the Senate. Please take a few minutes to send a letter using ACCC’s template to members of Congress on how these cuts are impacting care. ACCC will also continue to keep members informed of new developments.
If your cancer program is feeling the impact of sequestration, let us know. Contact Sydney Abbott at email@example.com.
Theo Salem-Mackall is the policy intern at the Association of Community Cancer Centers.