The CMS proposed rule would alleviate access-to-care requirements for certain scenarios for states.

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Mar. 30, 2018

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Editor’s Note: Health Policy Weekly will be on hiatus next week. We will resume publication April 13.

 
FEATURED STORY
 

Springing States Free From Medicaid Requirements

 
 

As part of the Trump Administration’s commitment to “cut the red tape” for states, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that would provide states with relief from certain regulatory access-to-care requirements within the Medicaid program.

Current regulations require states to develop and submit to CMS an access monitoring review plan (AMRP) for fee-for-service (FFS) Medicaid that must be updated at least every 3 years. States have expressed concerns regarding the administrative burden associated with meeting the Medicaid program’s access requirements. In particular, states with small numbers of Medicaid members enrolled in their FFS program, those that have members only temporarily enrolled, and states making small reductions to FFS payment rates have questioned the benefit of analyzing data and monitoring access in that program.

The proposed rule would alleviate access-to-care requirements in the following 3 scenarios:

  1. When at least 85% of covered Medicaid lives in a given state receive services through managed care plans, the proposed rule would exempt the state from requirements to analyze certain data and monitor access.
  2. Provider payment cuts would be exempt from access analysis if less than 4% in overall service category spending for a particular year, or 6% for 2 consecutive years.
  3. States making minor cuts to Medicaid payment rates would be able to use baseline information on access to care under current payment rates, instead of having to predict how those rate reductions would impact access.

By proposing these changes, CMS stated it is making an effort to provide states with more freedom to design innovative programs and focus on measuring program outcomes, while holding states accountable for achieving positive results for the populations they serve. The intention is also to relieve states from undue regulatory requirements while steering clear of increasing administrative costs for taxpayers. The Trump Administration has been focused on minimizing regulatory burden since its inauguration, and this proposed rule represents a concrete effort toward that goal.

 

Payer Tactics to Manage Commercial Copay Assistance

 
 

The prices for brand-name prescription drugs—particularly those products deemed as specialty drugs—continue to soar, leading to health insurance plans in the commercial (private market) sector exploring ways to manage these drugs more aggressively.

Patients may end up bearing the brunt of these market dynamics, often facing high out-of-pocket (OOP) costs for these drugs. Xcenda examines the payer tactics to manage copay assistance in a new issue brief. Download now

 
 

 
REGULATORY UPDATES
 

Questioning Things That Come in Bulk (Candy Not on List)

 
 

Earlier this week, Food and Drug Administration (FDA) Commissioner Scott Gottlieb released a statement regarding the FDA’s next steps in implementing the Drug Quality and Security Act (DQSA) and section 503B of the Federal Food, Drug, and Cosmetic Act. The draft guidance introduced by Gottlieb highlights the new provisions that will limit the bulk drug substances that outsourcing facilities can use in compounding and directs the FDA to develop the 503B bulks list, a list of bulk drug substances for which there is a clinical need.

Compounding can be critical for advancing the health of patients who have specific medical needs that cannot be met by FDA-approved drugs, but these drugs can also present a greater risk to patients because they do not undergo premarket review by the FDA for safety, effectiveness, and quality.

In January, the FDA released the compounding policy priorities plan, which lays out how the agency will implement, over the course of 2018, certain key provisions of the DQSA and other requirements of the law relevant to compounders.

As the next step in implementing the compounding policy priorities plan, this new draft guidance discusses the FDA’s interpretation of the statutory phrase “bulk drug substances for which there is a clinical need,” as well as the factors and processes the FDA proposes to use when evaluating whether to include a bulk drug substance on the list of bulk drug substances that outsourcing facilities may use in compounding drugs.

As the FDA further refines the policies regarding this topic, stakeholders will need to bring concerns to the FDA’s attention through public comment, and to be active participants as the 503B bulks list is implemented.

 

Utah Planting New Medicaid Ideas and Hoping They Take

 
 

On Thursday, Utah Gov. Gary Herbert (R) signed into law an authorization for the Utah Department of Health to submit a request to CMS to expand the state’s Medicaid program. This request is independent of the Affordable Care Act (ACA) and is more limiting.

While the ACA offers an opportunity for states to access available federal funds by expanding Medicare to individuals and families earning up to 138% of the federal poverty level (FPL), Utah is requesting a waiver to restrict availability to those earning just 95% of the FPL. The FPL is $12,060 for an individual and $24,600 for a family of 4. If granted, the waiver would expand Medicaid coverage to an additional 60,000 recipients in the state. The bill (HB 472) authorizing the waiver request also includes a work requirement and a path to self-sufficiency for able-bodied recipients.

Many Republicans have expressed a willingness to expand Medicaid if they can cap eligibility at the FPL. Gov. Herbert said of the bill, “This allows us to buy something today that we can afford tomorrow.” Eight of 12 Democrats in the State Senate voted for the Republican-supported bill, although some more conservative Republicans voted against it. President Trump recently demonstrated receptivity to work requirements linked to Medicaid eligibility, but CMS previously denied a similar waiver request from Arkansas.

If approved, other conservative states that have not expanded Medicaid might be motivated to follow Utah’s approach.

 

Hopping to It. Aetna Offers Point-of-Sale Rebates

 
 

Earlier this month, UnitedHealthcare announced its new program to pass a portion of drug-manufacturer rebates directly to some customers at the point of sale (POS), instead of using them to spread the savings across all members via lowered premiums and cost-sharing. On Tuesday, Aetna announced a similar initiative that will automatically apply pharmacy rebates at the time of sale for its fully insured commercial plan members, representing approximately 3 million members. The policy would go into effect in 2019.

The health insurer included in the announcement that it “believes that greater transparency is needed throughout the pharmaceutical supply chain in response to the nearly 25% increase in drug prices between 2012 and 2016” without an acknowledgement that its policies may have contributed to the price increase.

Health and Human Services (HHS) Secretary Alex Azar praised UnitedHealthcare’s decision several weeks ago. With 2 of the largest health insurers offering POS rebates—coupled with the full support of HHS—other health insurers are going to find it difficult to refrain from offering a similar benefit, as employers are likely to inquire when negotiating contracts. While these POS rebates are a step in the right direction, with the limited populations involved, it is a gesture and not a solution.

 

ICER Deems CAR-T to be a ‘Good Egg’

 
 

Last Friday, the Institute for Clinical and Economic Review (ICER) reported that chimeric antigen receptor (CAR) T-cell therapy improved response rates and survival for patients with cancer who have exhausted most other options. A majority of the panel felt the evidence demonstrated that KYMRIAH (tisagenlecleucel) and YESCARTA (axicabtagene ciloleucel) had a net health benefit for their specific indications when compared against traditional therapies.

ICER initiated the review process last summer, released the draft report in mid-February for public comment, and then held a panel discussion at the beginning of March.

The KYMRIAH arm was twice as expensive as the clofarabine comparator arm, but it showed gains in life years (LYs) and quality-adjusted life years (QALYs) more than 4 times greater, resulting in an incremental cost-effectiveness ratio of approximately $46,000 per QALY gained and approximately $42,000 per LY gained.

The YESCARTA arm was 4 times more expensive than the chemotherapy comparator arm, but its LY and QALY gains were more than double. This resulted in an incremental cost-effectiveness ratio of approximately $136,000 per QALY gained and approximately $112,000 per LY gained.

According to the report, the cost-effectiveness of both CAR-T therapies fell below or within commonly cited thresholds of $50,000–$150,000 per QALY.

Supporters of CAR-T therapy should be pleased—if not thrilled—that this novel way to treat cancer has gotten ICER’s imprimatur, as it has found most treatments to not be cost-effective. The open question is whether this will influence payer coverage of CAR-T therapy which, thus far, has been limited.

 

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:

 
HEARD ON THE STREET
 

“We took a first step toward transparency, but it wasn’t substantial enough to give us anything of true value.”

 

– Vermont State Representative William Lippert (D), commenting on the disappointing latest progress report of Vermont’s 2016 drug transparency law

Source: “Vermont’s Heralded Drug Prices Transparency Bill Disappoints Nearly Two Years In,” Kaiser Health News, March 29

 
POLICY BY NUMBERS
 

25%

 

Cigna has reduced opioid use among its customers by 25% within 2 years, 1 year ahead of schedule.

Source: “Cigna’s Partnership with Physicians Successfully Reduces Opioid Use by 25 Percent—One Year Ahead of Goal,” Cigna, March 28

 
UPCOMING MEETINGS & CONFERENCES
 

AMCP Managed Care & Specialty Pharmacy Annual Meeting

April 23–26 l Boston, MA
Join AmerisourceBergen companies, US Bioservices and Xcenda, at AMCP’s Annual Meeting at the Boston Convention and Exhibition Center, April 23–26. Meet with our specialty pharmacy and commercialization experts at the largest gathering of managed care professionals who work, lead, and innovate in the ever-changing world of pharmaceutical management. Visit AmerisourceBergen at booths 316 and 321. 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
Senior Director,
Health Policy
Xcenda

MANAGING EDITOR:
Scott Shields
Associate Director,
Health Policy
Xcenda

 

ADVISORY BOARD:

Peyton Howell, MHA
Executive Vice President & President, Health Systems & Specialty Care Solutions | AmerisourceBergen Corporation

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

Kristine Flemister, PharmD
President | Xcenda

Tommy Bramley, PhD, RPh
President | Lash Group

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:

Chris Droukas | Maureen Holmes | Stew Kaufman | Scott Shields

PRODUCTION:

Laurie Kozbelt | Ellen Olson

 

Mar. 30, 2018

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