CMS’ final rule for Medicare Advantage and Part D eliminates 2 of 3 proposed protected class exceptions.

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May 17, 2019

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FEATURED STORY
 

Patient Advocates for the Win: Eliminate 2 of 3 Proposed Protected Class Exceptions

 
 

Late Thursday afternoon, the Centers for Medicare & Medicaid Services (CMS) released a final rule outlining changes to the Medicare Advantage (MA) and Part D programs—many of which will be effective January 1, 2020.

While the proposed rule was heavy on plan flexibility—allowing plans 3 exceptions to the protected-class policy in Medicare Part D and considering redefining negotiated price to the lowest possible payment to the pharmacy—CMS scaled back in the final rule.

In the final rule, CMS decided:

  • To not move forward with provisions that would provide plan “flexibility” to manage protected classes by allowing plans to exclude a drug if a new formulation does not provide a unique route of administration or if the drug has cost increases above a certain threshold
  • To permit plans to use prior authorization and step therapy for protected class drugs (only “new starts” and not antiretrovirals)
  • To require plans to implement at least 1 electronic real-time benefit tool that integrates with provider systems
  • To require that Part D plans’ Explanation of Benefits statements communicate drug price increases and lower-cost alternatives
  • To introduce new requirements for when MA plans may apply utilization management, including step therapy, for Medicare Part B drugs and have exception requests mirror Part D timelines
  • To postpone any redefinition of negotiated price

The final rule was accompanied by a press release and fact sheet. From a patient perspective, the final rule still has additional barriers to access (step therapy, prior authorization) which are worrisome, but, considering the exceptions that had been on the table, it feels like a bit of a relief.

 
 

AMCP Webinar: Trends in Healthcare: Artificial Intelligence and Tech

 
 

Wednesday, May 29 | 2:00–3:00 PM ET

Health IT, artificial intelligence, and big data: it’s all contained within the technology global influencer we are tracking in the AMCP Foundation Trends in Healthcare. Register now to gain insight and prepare for the tech changes arriving at your organization in the coming years.

Xcenda’s Amy Duhig, PhD, Vice President of Strategic Market Access and Intelligence, will join Tina Moen, PharmD, Senior Deputy Chief Health Officer and Chief Pharmacy Officer at IBM Watson Health, to discuss the latest findings from the Foundation’s environmental monitoring. Two innovative case studies about artificial intelligence and wearables will be discussed.

Register now >

 

 

HPW Rebuild

 
LEGISLATIVE UPDATES
 

Ideas That Might Cascade: State-Based Public-Option Insurance

 
 

This week, Washington became the first state to enact public-option legislation. On Monday, Gov. Jay Inslee announced the signing of a bill, known as Cascade Care, that will offer public healthcare plans that cover standard services to all residents, regardless of income, by January 2021. Cascade Care’s intent is to boost insurance coverage across the state and to lower premiums and deductibles for families and people purchasing insurance on the individual market. The state will determine the terms of the public-option plans but will hire private insurance companies to administer them. The bill strives to ensure that patients do not spend more than 10% of their income on premiums.

The bill is meant to counter attempts by the Trump Administration and Republican lawmakers to undermine the Affordable Care Act (ACA), as Inslee has been working to expand and protect healthcare under the ACA for the past few years. Under this bill, the state Health Benefit Exchange will work with the Health Care Authority and others to create standardized health plans. Cascade Care will require health plans to reimburse medical providers and facilities at up to 160% of the Medicare rate. The original version of the bill capped the reimbursement at the Medicare rate, but a higher rate was implemented to help ensure health insurance companies would participate in the program.

Details remain about the scope of coverage that will be offered and how much (or whether) Cascade Care will drive down insurance costs. Supporters insist the bill will create competition in the insurance market, thus lowering premiums. Critics argue that the bill is a push for government-run healthcare and that it is a move toward a single-payer system.

Lawmakers in at least 8 other states, including Colorado and New Mexico, have proposed public options, but Washington is the only state to get it across the finish line. Washington’s experience with Cascade Care could influence how other public-option efforts develop around the country and drive the “healthcare as a right” conversation on a state, not federal, level.

 

Legislative Bytes

 
 
  • A White House Statement of Administration Policy calls for a veto of the Strengthening Health Care and Lowering Prescription Drug Costs Act (HR 987). The statement says that, while the “…legislation includes positive steps called for by the President to lower drug prices, …[it] also contains proposals…that would restrict access to healthcare coverage for many Americans and impede efforts to reduce inefficient spending on healthcare programs.”
  • Sen. John Cornyn (R-TX) introduced S 1416 that would amend the Federal Trade Commission Act to prohibit anticompetitive behaviors by drug product manufacturers. See accompanying press release.
  • Sen. Tammy Baldwin (D-WI) introduced S 1391 that would require reporting regarding certain drug price increases. See accompanying press release.
  • Sen. Dick Durbin (D-IL) introduced S 1437 that would require ads for prescription drugs and biological products to include truthful pricing information. See accompanying press release.
  • Senate Finance Committee Ranking Member Ron Wyden (D-OR) introduced the Health Care Price Check Act of 2019 that would require Medicare and insurance companies to make available an online tool and a toll-free number for beneficiaries to inquire about the cost of any service, procedure, or product, including prescription drugs.
  • Rep. Danny Davis (D-IL) introduced HR 2710 that would establish a new Medicare Part B device add-on payment for new medical devices furnished to individuals with end-stage renal disease.
  • Rep. John Larson (D-CT) introduced HR 2693 that would establish a minimum Part B payment amount for bone mass measurement.
  • Rep. Michael Burgess (R-TX) introduced HR 2700 that would incentivize low-cost drug options and generic competition.
  • Rep. Joe Cunningham (D-SC) introduced the Creating Lower Cost Alternatives for Your Prescription Drugs Act that would lower the cost of prescription drugs for beneficiaries who receive the low-income subsidy in Medicare Part D.
  • The House Budget Committee announced a May 22 hearing on key considerations for establishing a single-payer healthcare system. The 3 witnesses are from the Congressional Budget Office.
  • The House Energy and Commerce Health Subcommittee announced a May 21 hearing, “Improving Drug Pricing Transparency and Lowering Prices for American Consumers.”
 

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

 
 

ISPOR 2019 Symposium | Tuesday, May 21 | 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 >

 

 

 

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THE VALUE CORNER
 

ICER: Never Leaving Well Enough Alone + WA HCA

 
 

This week, the Washington State Health Care Authority (HCA) opened its public comment period for whole exome sequencing (WES) draft key questions. WES identifies small changes in DNA base pair sequences that can disrupt protein function and cause disease; when combined with bioinformatics analyses, it allows for the testing of a wide range of genetic diseases. WES is being assessed by the HCA due to concerns regarding its safety, efficacy, and cost.

Public comments on the draft key questions will be accepted until close of business on May 28. Comments can be submitted to shtap@hca.wa.gov. The Health Technology Clinical Committee (HTCC) is scheduled to review the WES assessment at its public meeting on November 15.

On May 9, the Institute for Clinical and Economic Review (ICER) released an evidence report assessing the comparative clinical effectiveness and value of SPRAVATO (esketamine), a nasal spray approved by the Food and Drug Administration (FDA) in March as a therapy for treatment-resistant depression (TRD). The report concludes that, in the absence of long-term safety data, the evidence provides moderate certainty that esketamine, when taken with a background antidepressant, achieves a comparable, small, or substantial net health benefit, but the evidence is inadequate to completely exclude the possibility that harms may exceed benefits.

Using the wholesale acquisition cost for esketamine, economic analyses assessing long-term cost-effectiveness found that treatment with esketamine is estimated to cost $198,000 per quality-adjusted life-year (QALY) gained, exceeding the commonly cited cost-effectiveness thresholds of between $50,000 and $150,000 per QALY.

ICER also released revised voting questions last week, which will be used for deliberation during the public meeting of the Midwest Comparative Effectiveness Public Advisory Council (Midwest CEPAC) on May 23 in Rosemont, IL. This 2-topic meeting will cover ICER’s review of esketamine for TRD as well as MAYZENT (siponimod) for secondary-progressive multiple sclerosis.

Last week, ICER also published a revised scoping document for its 2019 rheumatoid arthritis (RA) condition update. In its 2017 RA assessment, ICER evaluated 11 targeted immune modulators for the treatment of moderately-to-severely active RA. ICER’s 2019 RA assessment will include new data on upadacitinib, which is currently under review by the FDA, as well as clinical and economic evidence for INFLECTRA (infliximab-dyyb), a biosimilar of REMICADE (infliximab). The full research protocol is expected to be published on June 14.

As covered in the May 3 issue of Health Policy Weekly, ICER is still accepting public comments during the open input period for consideration in updating its value assessment framework (VAF).

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

A detailed agenda is 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.

HPW Rebuild

 
REGULATORY UPDATES
 

Interch-ch-ch-ch-changeables: Creating a More Defined Path Forward

 
 

Last Friday, the FDA released its final guidance regarding interchangeability of biosimilars. The document lays out the data and scientific justification required for biosimilar manufacturers to prove that a biosimilar produces “the same clinical result as the reference product in any given patient.”

The guidance is intended to assist manufacturers with submitting or supplementing their marketing applications; the following is a list of data that may be required for an application:

  • Identification and analysis of critical quality attributes
  • Identification of analytical differences and analysis of the potential clinical impact of such differences
  • Analysis of the mechanism of action in each condition of use
  • Analysis of differences in expected pharmacokinetics and biodistribution in different patient populations
  • Analysis of differences in expected immunogenicity risk
  • Analysis of differences in expected toxicity
  • Information on factors that could affect safety or efficacy

For biosimilars administered more than once to a patient, the final guidance requires a “dedicated switching study” design, in which patients start with the reference product and are randomly assigned to switch to the biosimilar or to continue using the reference product, for 1 or more conditions of use. This design serves to demonstrate that there is no added risk or diminished efficacy from switching treatments. In addition, the guidance specified that the product sponsor is not required to seek interchangeability for all of the product’s indications; however, the FDA recommends doing so by providing scientific justification that addresses any differences in safety and efficacy metrics.

The guidance will be helpful for healthcare systems that include pharmacies, as most states require a biosimilar to have the interchangeability designation before pharmacists can make the switch without informing the prescriber.

With the FDA providing the finalized guidance around what needs to be provided to meet the legal standard for interchangeability, biosimilars have a more defined pathway to improving payer uptake, patient access, and physicians’ willingness to prescribe—potentially accelerating the development of the biosimilars market and reducing overall US healthcare spending.

 

HCPCS Updates: Too Dull for a Snappy Title*

 
 

CMS held a series of public meetings May 13–15 to discuss upcoming Healthcare Common Procedure Coding System (HCPCS) coding decisions. The meetings allowed for public comment on HCPCS applications submitted for the 2020 HCPCS cycle.

During the meetings, Cindy Hake, Deputy Director of the Division of DMEPOS Policy, provided a few updates with requests for additional comments and feedback from interested parties on broader HCPCS issues:

  • Electronic submission of HCPCS applications. CMS piloted submitting HCPCS applications electronically in the 2020 cycle. Feedback from selected participants was very positive overall. CMS is working through operational considerations to implement this as an option for applicants, but no timeline or instructions were given for when it would be operational.
  • Ability to submit HCPCS applications more frequently. CMS Administrator Seema Verma issued a statement on May 2 that CMS will be moving away from the annual cycle of submitting HCPCS applications (as featured in the May 3 issue of Health Policy Weekly). CMS is moving toward a quarterly submission cycle for drugs and biologics, and a bi-annual cycle for durable medical equipment, prosthetics, orthotics, and supplies. CMS is also working through operational considerations, and no timeline or instructions were given for implementation, except that this would not go into effect in 2019.
  • Q-codes for biosimilars. One commenter mentioned that using Q-codes to report biosimilars was problematic for some payers and requested the creation of J-codes for them instead.

For all of these issues, the CMS HCPCS Workgroup is seeking feedback and input. Interested parties may submit questions, comments, and suggestions on any of the above issues to HCPCS@cms.hhs.gov.

*This is the opinion of the Editor-in-Chief and not representative of others on the editorial team and/or at Xcenda. She is just glad that others find this interesting so that she doesn’t have to.

 

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:

  • CMS issued guidance for Medicaid and the Children’s Health Insurance Program (CHIP) managed care plans regarding the calculation of a plan’s medical loss ratio (MLR). The MLR regulations for Medicaid and CHIP managed care plans currently require them to exclude prescription drug rebates from the amount of actual claims costs used to calculate an MLR. In the new guidance, CMS clarified that, for purposes of the MLR regulation, “prescription drug rebates” means any price concession or discount received by the managed care plan or by its pharmacy benefit manager (PBM), regardless of who pays the rebate or discount.
  • CMS announced it would not be issuing a final National Coverage Determination on chimeric antigen receptor (CAR) T-cell therapy for cancer today, but a decision is forthcoming.
  • Civica, the nonprofit generic drug company founded last year by hospital executives frustrated by drug shortages, announced it is partnering with Danish manufacturer Xellia to supply 2 generic antibiotics often in short supply, vancomycin and daptomycin. It marks the first time Civica announced the production of generic drugs.
  • The Community Oncology Alliance launched a national campaign to “stop PBM abuses and highlight patient horror stories.”
  • The Margolis Center for Health Policy at Duke University released a policy brief, “Breakthroughs and Barriers: Advancing Value-Based Payment for Transformative Therapies.” Transformative therapies are 1-time treatments with expected long-term, or even curative, effects.


 

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 next week, connect with us in New Orleans.

 

 

 

 

 
HEARD ON THE STREET
 

“Taking a cell phone into the bathroom and then leaving with it is kind of like going in, not washing your hands and then coming back out.”

– Emily Martin, Assistant Professor of Epidemiology at the University of Michigan School of Public Health

Source: Time Magazine, “Your Cell Phone Is 10 Times Dirtier Than a Toilet Seat. Here’s What to Do About It

 

 
POLICY BY NUMBERS
 

18.2 Million

 

In 2018, 30.4 million persons of all ages (9.4%) were uninsured at the time of interview—not significantly different from 2017, but 18.2 million fewer persons than in 2010.

Source: “Health Insurance Coverage: Early Release of Estimates From the National Health Interview Survey, 2018,” National Center for Health Statistics, May 2019

 
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

 

AMCP Webinar: Trends in Healthcare: Artificial Intelligence and Tech

Wednesday, May 29 | 2:00–3:00 PM ET
Xcenda’s Amy Duhig, PhD, Vice President of Strategic Market Access and Intelligence, will join Tina Moen, PharmD, Senior Deputy Chief Health Officer and Chief Pharmacy Officer at IBM Watson Health, to discuss the latest findings from the AMCP Foundation Trends in Healthcare environmental monitoring of health IT, artificial intelligence, and big data. Two innovative case studies about artificial intelligence and wearables will be discussed. Register now

 
 
 

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:

Anuja Kanaskar | Cliffrey Li | Amanda O’Hora | Scott Shields | Jennifer Snow | Robin Tan | Stephen Wilson

PRODUCTION:

Laurie Kozbelt | Ellen Olson

 

May 17, 2019

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