The Affordable Care Act Stands: Now What?

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Regardless of what happens politically, health-care reform has launched a series of irreversible changes that will affect the way we practice oncology.

— Beverly Moy, MD, MPH

On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act into law—a hotly contested bill that enacted sweeping changes to the U.S. health-care system. The debate over the Affordable Care Act continued all the way to the Supreme Court, spearheaded by the case Florida v Department of Health and Human Services, which challenged the constitutionality of the individual mandate, the centerpiece of the law. On June 28, 2012, in a 5 to 4 vote, the Supreme Court rendered its decision: The Affordable Care Act stands. Although the Court’s decision is conclusive, the political rancor over the legislation will undoubtedly be center stage in the upcoming battle for the White House.

The oncology-related parts of the Affordable Care Act were addressed during an educational session at this year’s ASCO Annual Meeting. Presenter Beverly Moy, MD, MPH, Massachusetts General Hospital, stated, “Regardless of what happens politically, health-care reform has launched a series of irreversible changes that will affect the way we practice oncology. For instance, value-based purchasing, payment bundling, and accountable care organizations are not going away.”

Access to Cancer Care

Dr. Moy explained that a cornerstone of the Affordable Care Act is Medicaid expansion. Beginning in 2014, the legislation will expand coverage to all Americans younger than 65, up to 133% of the federal poverty level, which is an income of $29,340 or less per year. “The law also provides ‘premium credits’ for the purchase of private insurance to individuals and families earning up to 400% of the federal poverty level, which is an income of about $88,000 per year for a family of four,” Dr. Moy said.

“[The Affordable Care Act] also provides dependent coverage for children up to age 26 under all individual and group policies. In short, the legislation creates national standards of uniform Medicaid eligibility for all people below the poverty level and extends coverage for dependent adult children on their family’s policies,” Dr. Moy said.

Perhaps the most popular provision for the oncology community is coverage for preexisting conditions, which will be fully implemented by 2014. “Under [the Affordable Care Act], insurance companies cannot deny coverage for people with preexisting conditions, and premiums cannot be based on gender or health status,” Dr. Moy said, She added that until the health insurances exchanges are available, uninsured Americans with preexisting conditions will be covered by a temporary high-risk pool.

Filling the Hole

Although Medicare Part D does not affect reimbursement for IV chemotherapy, the growing number of expensive oral oncology drugs makes the prescription drug program an issue of increasing importance. Prior to the Affordable Care Act (and until its provisions are fully enacted), once patients hit a preset spending limit on drugs of about $2,800, they enter a coverage gap known as the “donut hole” and are responsible for all drug costs until reaching the upper end of the donut hole—approximately $4,500—at which time they receive catastrophic coverage that pays for 95% of further medications.

Dr. Moy used a case example, a 67-year-old man with metastatic renal clear-cell cancer, to illustrate the economic effect of the donut hole. “He’s on sunitinib [Sutent], which runs $4,480 per cycle, so he gets into the donut (between $2,800 and $4,500) at cycle 1 of his treatment, which costs about $18,000 for the full 6 months of therapy. After emerging, he gets the 95% catastrophic drug coverage, but while in the donut hole he spent about $5,500, which is a huge out-of-pocket expense for a senior on a fixed income,” Dr. Moy said.

Dr. Moy commented that although the health-care reform legislation does not completely fix the donut hole, it helps close the out-of-pocket burden. “Every eligible senior receives a one-time tax-free $250 rebate check, but more importantly, incrementally between now and 2020, the coverage gap will be filled by subsidies from manufacturers of brand-name drugs and from the federal government. This is an extremely complex process that will require providers and payers working together to assist patients in navigating the benefit,” Dr. Moy stressed.

The Inevitable Reality

Dr. Moy pointed out that the fundamental philosophy behind the implementation of the Affordable Care Act was to provide coverage for all Americans, and at the same time increase quality of care and decrease overall costs. It is a grand vision that is largely a work in progress. But one thing is certain—the way physicians get paid for delivering services is being scrutinized.

“The Affordable Care Act establishes a national pilot program to encourage providers to improve coordination of care, and that’s where payment bundling comes in. Rather than the traditional fee-for-service payment model, hospitals and providers are paid a flat rate for an episode of care, such as a specific cancer diagnosis. Moreover, accountable care organizations are being set up all over the country, driving doctors together ostensibly to provide evidence-based medicine. The goal is to manage episodes of care collaboratively and reduce costs. We’ll be reimbursed singly, and this is inevitable,” Dr. Moy said with emphasis.

New Foundation for Health Care

“The Affordable Care Act has provided a new foundation for the entire health-care system to build on, but we in the oncology community need to be especially aware of how this bill is going to impact the way we provide care,” Dr. Moy said. She added that the hope among oncologists is that all patients with cancer will now have access to health insurance.

Moreover, she reemphasized the need for those in the oncology community to brace for what could be some unsettling changes. “The details of implementing the Affordable Care Act are left to the discretion of the Secretary of Health and Human Services, so there will be a series of changes, both positive and negative, that we need to keep abreast of,” Dr. Moy concluded. ■

Disclosure: Dr. Moy reported no potential conflicts of interest.

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