Health Policy Weekly looks at the federal response to the opioid crisis and Harvard Law School’s report on the lack of access of hepatitis C treatments for Medicaid patients.

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Oct. 27, 2017

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FEATURED STORIES
 

Trump Declares Public Health Emergency for Opioid Addiction

 
 

On Thursday, President Donald Trump declared opioid addiction a “public health emergency” as he sought to accelerate a federal government response to the crisis.

President Trump said his plan would include a requirement that federally employed prescribers be trained in safe practices for opioid prescriptions, and a new federal initiative to develop non-addictive painkillers. He also plans to suspend a rule preventing Medicaid from funding many drug rehabilitation facilities; Medicaid currently covers residential addiction treatment in community-based programs only if they have 16 or fewer beds.

Critics noted the directive stops short of the “national emergency” designation that Trump had said over the summer he would apply to the epidemic of abuse and overdose of the drugs. They also pointed out that, so far, the President has not released any additional funding, and he did not request any, although his aides said he would soon do so.

 

No Grade Inflation: Harvard Fails Some States on Hep C Treatment Access

 
 

According to a Harvard Law School and National Viral Hepatitis Roundtable report card released Monday, over half of states received a “D” or “F” in overall access to hepatitis C treatment for Medicaid patients.

Hepatitis C affects 3.5 million Americans, many of whom are Medicaid recipients, and it kills more patients than all other infectious diseases (including HIV) combined. In 2013, curative treatments with minimal side effects became available, offering cure rates of nearly 100%. Given the cost of these therapies, however, many states are setting access limits to Medicaid patients, including:

  • Liver Disease Progression: Requiring patients reach a certain stage of liver disease, which could be irreversible and can cause cancer
  • Substance Use/Sobriety Requirements: Excluding patients who have a history of substance or alcohol abuse
  • Prescriber Restrictions: Only allowing certain specialists to prescribe a cure

These 3 treatment restrictions contradict guidance from the Centers for Medicare & Medicaid Services (CMS) and recommendations from the American Association for the Study of Liver Diseases and the Infectious Disease Society of America which recommend more expanded access.

While a majority of states scored poorly, there has been improvement across the country. In a study conducted in 2014, 42 state Medicaid programs were identified as potentially violating federal Medicaid law, which requires states to cover drugs consistent with their Food and Drug Administration (FDA) labels, and all drugs with rebate agreements with the Secretary of Health and Human Services (HHS) must be available with only limited restriction methods. The 2014 study recommends states consistently develop transparent criteria for coverage of these products that are easily accessible and evidence based. Access has also grown due to an increase in the number of products available on the market, which has driven the price of treatment down.

 

Amanda Forys Featured in The Center for Biosimilars

 
 

Biosimilars Payment: New Market Could Reduce Drug Costs but Faces an Uphill Policy Battle

“Because Medicare will be such a large payer for these drugs, coding and payment policy set forth by CMS will have a significant effect on the success, sustainability, and availability of these lower-cost alternative products.”

The promise of biosimilar cost savings in the US market faces an uphill battle. Coding and payment policies could hinder the potential for a robust biosimilars market. In a series appearing in The Center for Biosimilars, Amanda Forys, Director of Xcenda’s Reimbursement Strategy Insights team, looks into the controversial payment model and its implications for the healthcare market. Read more

 

 

 
LEGISLATIVE UPDATES
 

One More Bite at the (Healthcare Reform) Apple

 
 

On Tuesday, Republican Senate Finance Committee Chairman Orrin Hatch (R-UT) and Republican House Ways and Means Chairman Kevin Brady (R-TX) announced a plan to stabilize the health insurance exchanges created by the Affordable Care Act (ACA). The newly released plan, referred to as Hatch-Brady, is the latest in what has been a long and tumultuous congressional session of failed attempts at healthcare reform in the US.

Hatch-Brady is competing with a bipartisan plan sponsored by Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA). Alexander-Murray was developed during a previous attempt to strike down the ACA and has gained attention after the last failed repeal effort. On Wednesday, the Congressional Budget Office (CBO) said enacting the legislation Alexander-Murray would reduce the deficit by $3.8 billion over the 2018–2027 period without substantially changing the number of people with health insurance coverage. A CBO score is not yet available for Hatch-Brady.

The 2 plans share one commonality: funding cost-sharing reduction (CSR) payments to insurers. Otherwise, key provisions of Hatch-Brady include suspending the individual mandate, refunding employer mandate penalties, and expanding health savings accounts.

When scoring past repeal and/or replace proposals, the CBO has noted that a repeal of the individual mandate will lower the deficit with a tradeoff of increasing the number of uninsured Americans. Further, critics of Hatch-Brady cite the threat of undermining the ACA health insurance markets if the individual mandate is rolled back. After initially praising the Alexander-Murray deal, President Trump has indicated preferences for action more closely aligned with Obamacare repeal—enter Hatch-Brady, stage left. Regardless, before either proposal gets to the President’s desk, each will face challenges accumulating the necessary votes.

 

Legislative Bytes

 
 
  • Senate Budget Committee Ranking Member Bernie Sanders (I-VT) and House Committee on Oversight and Government Reform Ranking Member Elijah Cummings (D-MD) introduced the Medicare Drug Price Negotiation Act.
  • The House will take up legislation next week to extend federal funds for the Children’s Health Insurance Program, Majority Leader Kevin McCarthy (R-CA) announced yesterday; the House is also expected to vote on repeal of the Independent Payment Advisory Board (IPAB) next week.
  • A bipartisan group of 179 House members sent a letter to Speaker Paul Ryan (R-WI) urging repeal of the medical device tax which, absent legislative action, will take effect in 2018.
 

Practical Implications of Value-Based Pricing and Emerging Value Frameworks in Health Technology Assessments

 
 

ISPOR’s 20th Annual European Congress
Glasgow, Scotland | 4–8 November 2017

Join Jay Jackson, PharmD, MPH, Senior Vice President of Consulting Services, as he moderates a Tuesday lunchtime symposium titled, “Practical Implications of Value-Based Pricing and Emerging Value Frameworks in Health Technology Assessment,” at the ISPOR 20th European Congress in Glasgow, Scotland.

Visit us at booth #602 to meet with our global HEOR team. Click here to learn about our award-winning research and our other ISPOR Glasgow contributions.

 

 

 
REGULATORY UPDATES
 

Making Things Interesting: CSR Subsidies Don’t Have to Resume

 
 

This week, US District Court Judge Vince Chhabria ruled the federal government does not have to immediately resume paying the ACA’s CSR subsidies that President Trump halted last week. The subsidies would have totaled $7 billion this year.

A coalition of 19 state attorneys general (including the District of Columbia) had argued several weeks ago the monthly payments were required under the ACA and that ending them would harm consumers. They were seeking an emergency temporary order that would have maintained the funding while the rest of the case is decided.

However, Judge Chhabria, appointed by former President Barack Obama, said the Trump Administration had the “stronger legal argument” and that the emergency relief sought by the states would be “counterproductive.” He stated the vast majority of states already have prepared for the termination of the payments and “devised responses that give millions of lower-income people better health coverage options than they would otherwise have had.”

The states had asked him to force the government to keep making the payments while the case works its way through the courts, which will take months.

 

New Savings Estimate for Biosimilars

 
 

The introduction of biosimilars could reduce healthcare spending in the US by $54 billion over the next decade, according to new analysis from the RAND Corporation. The savings estimate is about 20% larger than a similar analysis conducted by RAND researchers 3 years ago, due to improved analysis methods and rapid growth in spending for biologics overall.

The updated estimate focuses on the potential reduction in spending due to lower unit prices for biologics. RAND modeled 2.5% quarter-on-quarter market growth (or about 7% year-on-year growth), a 30% biosimilar market share, constant reference biologic prices, and biosimilar prices that are 70% of the reference biologic price.

RAND researchers estimated that biosimilars will reduce biologics spending by about 3% over the next 10 years. The range of the new savings estimate given “reasonable” ranges of key assumptions, such as the price of biosimilars vs reference biologics and biosimilar market share, varied from $24 billion to $150 billion from 2018 through 2027.

The biosimilar market is currently moving slowly. While the FDA has approved 7 biosimilars, 4 are not available on the market due to legal challenges.

The study authors acknowledged the fluidity of the biosimilar market, stating its baseline estimate hinges, in large part, on whether manufacturers continue to have a business case to invest in developing and marketing biosimilars. They listed a number of key challenges and sources of uncertainty that could determine the direction of the market:


    
In terms of payment arrangements, CMS is expected to release the Medicare Physician Fee Schedule within the next 2 weeks, where it may revisit the Medicare Part B payment methodology for biosimilars. CMS had asked for public comments about current policy, in which reference biologics have their own Healthcare Common Procedure Coding System (HCPCS) codes and average sales prices (ASPs), while biosimilars to a reference biologic share HCPCS codes and an averaged ASP. This sets up a few weeks of potential change in the biosimilars space that could dramatically shape its marketplace moving forward.

For another analysis of the cost-saving potential of biosimilars, we invite readers to Xcenda’s joint collaboration with the Biosimilars Forum that shows how adopting a policy in which each biosimilar has its own billing code and separate payment rate could increase savings by an additional $15.1 billion.

 

Information Buffet (AKA, Other Stuff That Caught Our Attention)

 
 

We kept running into stories we wanted to bring to your attention, so here’s a quick hit list of other news we thought you should know:

  • Joe Selby, Executive Director of the Patient-Centered Outcomes Research Institute, describes highlights of the organization’s third annual meeting, “Delivering Results, Informing Choices,” taking place October 31–November 2.
  • A Gallup poll found the US uninsured rate climbed to 12.3% in Q3 2017.
  • The Commonwealth Fund discusses options to expand health insurance enrollment in the individual market.
  • The Wall Street Journal reported yesterday that CVS Health is in talks to buy Aetna.
 
HEARD ON THE STREET
 

“It was so eye-opening to go through and find all the inefficiencies and to see how we have moved the bar from both a clinical and financial perspective in a way I would never have imagined.”

 

– Jon Fohrer, Network Vice President for Orthopedics and Neuroscience at Community Health Network, commenting on how his attitude toward the Center for Medicare and Medicaid Innovation Comprehensive Care for Joint Replacement (CJR) program changed once his facility started implementing the demonstration

Source: “Hospitals warm up to CMS bundled payments as agency cools off on them,” Modern Healthcare, October 26

 
POLICY BY NUMBERS
 

21% vs 25% | 42% vs 46%

 

Despite continued publicity and physician-outreach efforts about the American Board of Internal Medicine (ABIM) Foundation’s Choosing Wisely campaign, there were no significant changes between 2014 and 2017 in awareness of the campaign among physicians (awareness increased from 21% to 25%) or physician-reported difficulty in talking to patients about avoiding a low-value service (42% reported that such conversations had gotten harder in 2014, and 46% did so in 2017).

Source: “Choosing Wisely Campaign: Valuable For Providers Who Knew About It, But Awareness Remained Constant, 2014–17,” Health Affairs, October 24

 
UPCOMING MEETINGS & CONFERENCES
 

ISPOR 20th European Congress

November 48 l Glasgow, Scotland
Join Xcenda’s Jay Jackson, PharmD, MPH, Senior Vice President of Consulting Services, as he moderates a Tuesday lunchtime symposium titled, “Practical Implications of Value-Based Pricing and Emerging Value Frameworks in Health Technology Assessment,” at the ISPOR 20th European Congress in Glasgow, Scotland. Visit us at booth #602 to meet with our global HEOR team and learn more about our award-winning research. Learn more

 

13th Annual Personalized Medicine Conference

November 14–16 l Boston, MA
Join Jennifer Snow, MPH, Director of Health Policy, at the 13th Annual Personalized Medicine Conference in Boston as she moderates a panel titled, “Precision Valuation: A Discussion of How Value Assessment Frameworks Can Account for Personalized Medicine.” Learn more

 
 
 

Count on Health Policy Weekly for an at-a-glance view of legislative and regulatory developments and news that impacts the healthcare industry.

 
 
 
 
 
FEATURED CONTRIBUTORS
 

EDITOR-IN-CHIEF:
Jennifer Snow
Director,
Health Policy
Xcenda

MANAGING EDITOR:
Scott Shields
Associate Director,
Health Policy
Xcenda

 

ADVISORY BOARD:

Peyton Howell, MHA
President | Global Sourcing & Manufacturer Relations | AmerisourceBergen Corporation

Amy Grogg, PharmD
Senior Vice President | Strategy & Commercialization | AmerisourceBergen Corporation

Tommy Bramley, PhD, RPh
President | Xcenda

Stacie Heller
Vice President | Government Policy | AmerisourceBergen Corporation

Rita Norton
Senior Vice President | Government and Public Policy | AmerisourceBergen Corporation

Ana Stojanovska
Vice President | Reimbursement & Policy Insights | Xcenda

CONTRIBUTING AUTHORS:

Amanda Forys | Andrew GaiserScott Shields

PRODUCTION:

Laurie Kozbelt | Ellen Olson | Tia O’Brien

 

Oct. 27, 2017

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