CMS is committed to modernizing regulations around new technologies, including additional HCPCS code assignment opportunities.

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May 3, 2019

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FEATURED STORY
 

That Cheer? It Was the Coding Nerds Happy About More Codes, More Often

 
 

Last month, the Centers for Medicare & Medicaid Services (CMS) released not 1 but 2 HCPCS Quarterly Update files for July 2019 updates that included several new J-codes for drugs that would become active for dates of service on and after July 1, 2019. No doubt, coding gurus nationwide had a double take at the J-codes in these files, since new J-codes have traditionally been added only once annually in January. The conspiracy theorists among us (thou who shall not be named) were concerned that, any moment, CMS might remove the files once the error had been discovered.

But this week, CMS Administrator Seema Verma confirmed that CMS is indeed moving in the direction to assign HCPCS codes quarterly for drugs and semi-annual opportunities for devices. Expect additional details posted on the CMS website regarding updates to the process; however, Xcenda recommends to submit completed HCPCS applications as soon as possible to meet the first possible deadline.

Verma also announced a change for technologies billed with category III HCPCS codes, representative of emerging technologies. CMS will require Medicare Administrative Contractors (MACs) to follow the new Local Coverage Determination (LCD) process, which CMS stated will provide more transparency into the evidence and rationale used in proposed coverage determinations for emerging technologies.

Verma said CMS is committed to removing government barriers and modernizing regulations around new technologies to ensure safe and effective treatments are readily accessible to beneficiaries without delaying patient care. The CMS actions represent key components of the agency’s attempts to facilitate access to innovative drugs and other technologies, which were already improved with the proposed decision to increase the new technology add-on payment discussed in last week’s proposed rule for the fiscal year 2020 Inpatient Prospective Payment System.

As you can probably tell, our coding folks thought this was the coolest news (we proposed that they need more time off given the excitement they showed). But the moral of the story is that the coding season has opened up and our team here at Xcenda is (more than) eager to help.

 

HPW Rebuild

 
LEGISLATIVE UPDATES
 

And So It Begins: Looking for What Comes Next in Healthcare Reform

 
 

On Tuesday, the House Rules Committee held the first Medicare for All hearing. On the agenda was HR 1384. Despite the partisan nature of the issue, the discussion was fairly “even keeled.” The committee and viewers heard perspectives from a couple of economists, a patient, and an ER doctor.

The bill that was the subject of Tuesday’s hearing was authored by Rep. Pramila Jayapal (D-WA), Co-chair of the Congressional Progressive Caucus. The Medicare for All Act of 2019 (HR 1384) would: enhance Medicare’s benefits; eliminate copays, deductions, and premiums; and extend coverage to all American residents. Many of the presidential candidates support Medicare for All, though they have different ideas about how it would take shape.
 
There was discussion about possible changes to the Medicare for All bill:

  • Transition time between 2 or 4 years
  • Encourage private plans to compete
  • Create a cap on out-of-pocket costs
  • Develop a public plan based on a Medicare pilot program in certain states without many insurers
  • Allow public funding for drug research
  • Reduce the Medicare age to 64 as a transition
  • Measure outcomes, savings (administrative, billing)
  • Address issues with costs (eg, learn from Vermont’s attempt at a single-payer system)

Days later, the Congressional Budget Office (CBO) released a report detailing the primary features of single-payer systems and what policy makers will need to consider when creating the programs’ design. (See Legislative Bytes.)

 

If At First You Don’t Succeed, Try, Try Again

 
 

The Maryland House of Delegates voted in favor of a bill (HB 768) that would allow prices for certain drugs to potentially be capped. The objective is to create an opportunity to set the maximum that state and local governments would pay for a particular medication.

Should the bill be signed into law, a 5-person board would evaluate 3 types of cases: drugs with a $30,000 price for a year or for course of treatment, brand name drugs that increase by at least $3,000 over the same period, and generic drugs that go up at least 200%.

If, after the review, the Drug Affordability Board concludes that a medication presents an accessibility challenge, and after considering various factors related to the drug’s pricing, if considered appropriate, it would set an upper payment cap for that medication. Manufacturers would have the right to appeal a decision by the board, and, should the appeal be denied, they could file a lawsuit.

PhRMA opposed the bill, asserting it could lead to drug shortages and reduce access to lifesaving medicines.

The bill is expected to affect 250,000 public employees and dependents as well as state purchases. The governor has until the end of May to either sign the bill or do nothing, and it becomes state law.

HB 768 was written to incorporate lessons learned from a US Court of Appeals overturning the state’s “price gouging” law last year. Other states that have been attempting to control drug prices through legislation, such as Massachusetts, will be keeping a close eye on what happens in Maryland.

 

Legislative Bytes

 
 

HPW Rebuild

 
THE VALUE CORNER
 

ICER: Making Up for the Silence of 2 Whole Weeks

 
 

After a 2-week hiatus from new reports and requests for input, the Institute for Clinical and Economic Review (ICER) made up for lost time.

Yesterday, ICER announced a national call for public comment on a methodological and process update to its value assessment framework (VAF). As part of ICER’s plans to amend its VAF every 2 years, the new framework will formally go into effect January 1, 2020, and will guide all of ICER’s assessments from that date forward.

Feedback on how to improve any element of ICER’s current VAF will be accepted until 5:00 PM ET Monday, June 10, and these comments will be used to inform the first iteration. Specifically, ICER is looking for suggestions related to the:

  1. Cost-effectiveness thresholds ICER uses to establish its value-based price benchmarks for treatments of both common and ultra-rare diseases
  2. Approach ICER takes to evaluate the magnitude and certainty of the net health benefit demonstrated by the clinical evidence, as well as how real-world evidence can be incorporated into these judgments
  3. Use of both the quality-adjusted life-years (QALY) and the equal value of life-years gained (evLYG) calculations to evaluate the degree of improvement in health outcomes
  4. Methods by which to integrate those potential benefits, contextual considerations, and other factors relevant to judgments of an intervention’s value that cannot be easily captured through review of the clinical evidence or through cost-effectiveness modeling

After posting the draft update on August 16, a second public comment period on the proposed modifications will be open for 8 weeks and will close on October 11. The final document will be posted on December 18.

This week also brought draft scoping documents reviewing type 2 diabetes treatments and an evidence report on the use of MAYZENT (siponimod) to treat secondary progressive multiple sclerosis.

In addition, we would like to highlight that there will be several key value-related sessions and symposiums that will be featured at the upcoming ISPOR 2019 meeting in New Orleans later this month. Topics include VAFs, value-based contracting, and health technology assessment (HTA) decision making. Be sure to reference this list of exciting sessions when planning your ISPOR 2019 agenda.

A detailed agenda is also available at the ISPOR 2019 website. As always, if you need assistance with all things ICER or value-related, please contact kristen.migliaccio@xcenda.com.

 

Concerned About ICER’s Unsupported Price Increase Assessment?

 
 

Let’s talk about how the current value framework landscape can impact your launch.

On May 2, 2019, ICER announced an opportunity for public input on its methodology. Come talk with former ICER associates and current Xcenda value experts on proactive measures your HEOR teams can take to be prepared.

Contact us now, or if you’re attending ISPOR 2019 later this month, connect with us in New Orleans.

 

 

 

 

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REGULATORY UPDATES
 

CMS NCD for NGS of DNA Because BRCA LCD

 
 

This week, CMS reopened its national coverage determination (NCD) for next-generation sequencing (NGS) for patients with advanced cancer. CMS is only reconsidering the evidence available for tests of germline mutations to identify those with hereditary cancer who may benefit from targeted treatments based on results of the test, and stated that all other tests are beyond the scope of the reconsideration.

NGS testing involves simultaneous sequencing of millions of DNA fragments and allows for analysis of a large number of genomic targets with a single test; the process can help to predict how an individual may respond to potential oncology treatments. The original NCD covered NGS testing for patients with recurrent, relapsed, refractory, metastatic, or advanced stage III or stage IV disease. The original policy caused confusion in the lab industry, as it was interpreted as removing coverage for germline NGS testing for early-stage (stage I or II) patients, which occurs in approximately 60% of cancer patients. In February, 63 healthcare organizations sent a letter to CMS asking for the NCD to be revised, arguing that the policy would restrict patient access to NGS testing for early-stage cancer patients, thus negatively impacting cancer care and outcomes.

CMS finalized the original NCD in 2018. At the start of this year, a Medicare contractor revised an LCD to align with the NCD by restricting BRCA1 and BRCA2 genetic testing in patients with early-stage cancer. CMS recently delayed implementation of this LCD from March until April. CMS initiated the national coverage analysis for NGS for Medicare beneficiaries with advanced cancer on April 29, 2019, and is accepting public comments until May 29, 2019. A draft proposed decision memo is expected by October 29, 2019, and the new NCD is expected to be finalized by January 2020.

 

Looking To Be the Tortoise, Not the Hare:
Geisinger’s Efforts to Lower Spend on Biologics

 
 

A recent Healthcare Financial Management Association report showed how Geisinger Health Plan slowed its rapid increase in biologic spending. In 2014, biological drugs comprised 24.2% of the integrated health system’s total drug spending. By 2018, the share was 35.9%, even though biologics represented only 0.77% of the health plan’s drug claims.

However, broad implementation of a systematic approach to population management has flattened that increase, with biologics representing 36.1% of total drug spending so far in 2019. The approach used the following steps:

  • Researched current literature and guidelines to develop best practices
  • Established procedures for process evaluation and updates
  • Incorporated patient feedback
  • Required robust reporting
  • Aligned health plan, provider, and patient incentives

Specific disease states that this model had a significant impact on included psoriasis and hepatitis C. For psoriasis, the health plan examined its enrollees’ results from different treatments and found that use of a light box for phototherapy was much more effective than high-cost system biologics. For hepatitis C, a key to improving treatment efficacy was the finding that some patients require 4 additional weeks of treatment beyond the standard 8 weeks.

Overall, Geisinger was able to maintain biologic drug spend at a steady rate, instead of spending more throughout the course of the year; plan executives were concerned that the cost of biologics was going to hit 50% of drug spend.

This finding comes at an interesting time; drug pricing and the rising cost of healthcare are areas that have received a lot of attention. Perhaps other health plans will follow suit implementing similar models.

 

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:



 

Concept to Coverage:
Utilization of Value Assessment Frameworks in Payer Decision Making

 
 

ISPOR 2019 Symposium | May 21, 2019 | 7:15–8:15 AM CT

In an era when VAFs are formally being adopted and impacting coverage, pricing, and reimbursement decisions, we examine recent high-profile cases where specific VAFs are being utilized and discuss their impact on the broader trend toward formal adoption of VAF recommendations in the United States.

This symposium will also review recent payer trends and provide perspective from payer decision makers on their own experiences incorporating “value” into coverage determination.

Learn more about our participation at ISPOR 2019 >

 



Have immediate needs to evaluate how ICER and other VAFs may impact your product portfolio?

Contact us to set up a free 30-minute consultation at ISPOR 2019 >

 

 

 

 
HEARD ON THE STREET
 

– Joe Biden on Twitter, April 29

 

 
POLICY BY NUMBERS
 

$177 Billion vs $196 Billion

 

The Trump Administration’s plan to eliminate drug manufacturer rebates in Medicare and Medicaid would increase federal spending by about $177 billion over a decade, a new CBO analysis finds—slightly less than the $196 billion CMS actuaries estimated for increased federal Medicare Part D spending.

Source: “Incorporating the Effects of the Proposed Rule on Safe Harbors for Pharmaceutical Rebates in CBO’s Budget Projections—Supplemental Material for Updated Budget Projections: 2019 to 2029,” CBO, May 2

 
UPCOMING MEETINGS & CONFERENCES
 

ISPOR 2019

May 18–22 | New Orleans, LA
Xcenda’s global HEOR experts join more than 4,200 attendees from around the world at ISPOR 2019 in New Orleans. Timely topics such as VAFs and what to expect with them in the future will be our focus. Join us at booth #501 to meet our team and learn how we can help you navigate the changing healthcare landscape. 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
Vice President,
Reimbursement and
Policy Insights,
Xcenda

MANAGING EDITOR:
Scott Shields
Associate Director,
Health Policy
Xcenda

 

ADVISORY BOARD:

Doug Cook
President | Commercialization Services & Animal Health

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 | Commercial Consulting | Xcenda

CONTRIBUTING AUTHORS:

Jenna Kappel | Anne Loos | Joaquin Zabalza Seguin | Scott Shields | Robin Tan | Linnea Tennant | Tammy Washington

PRODUCTION:

Laurie Kozbelt | Ellen Olson

 

May 3, 2019

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