Oncology Community Faces Complex Challenges in Evolving Policy Arena

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As the political environment heats up in advance of the upcoming presidential campaign season, many issues crucial to the oncology community are being placed on the political chopping block as policymakers seek ways to reduce the mounting debt and soaring health-care spending. To help clarify some of the current policy concerns crucial to the delivery of cancer care, The ASCO Post spoke with Ms. Shelagh Foster, Director of Government Relations for ASCO.

The SGR Problem Resurfaces

As reported previously in The ASCO Post, a “patch” for the sustainable growth rate (SGR)—the instrument used to calculate physicians’ fee schedule—was passed at the end of last year, averting a 23% cut in Medicare reimbursement for physician services. However, if Congress does not act by January 1, 2012, a 29.5% cut in physician reimbursement could take effect. Congress faces a dilemma: A true SGR fix—eliminating the problematic instrument—would cost taxpayers well in excess of $300 billion.

“Current talks on the Hill include a permanent fix to the SGR formula or a freeze of some period to allow ample time for policymakers to develop a permanent fix. However, these proposals do not outline what the fix will be, and any solution will likely be tied to quality reporting,” said Ms. Foster. “ASCO continues to work hard with members of Congress to include the SGR fix into any of the comprehensive budgetary packages that are put forth,” she added.

Cuts to Medicare Reimbursement

Foster quoteThe cancer community is expressing deep concern over a proposed $3 billion cut in Medicare reimbursement for oncology drugs. ASCO and other leading cancer groups signed onto a letter, sent to the White House and congressional leadership on July 14, urging both parties to oppose a proposed $3 billion funding cut to Medicare reimbursement for oncology drugs. While these cuts were originally proposed in the debt ceiling negotiations, they will likely be on the table for any Medicare reform or proposed SGR fix.

Ms. Foster explained that cuts would shave another 2 points off the average sales price, which is linked to the reimbursement rate, bringing it from 106% of average sales price, down to 104%. “The message we impress on policymakers is that many community practices are already struggling to make up the shortfall from Medicare drugs currently ‘underwater’ [ie, insufficiently covered by current Medicare payments], and cuts of this proportion would have a devastating effect on access,” said Ms. Foster.

She stressed that in the grand scheme, the cuts to oncology being proposed have little effect on the overall budget or Medicare, but will hamper an already fiscally challenged cancer care delivery system.

Reporting System Signals Change

In 2007, Medicare began operating the Physician Quality Reporting System (formerly known as the Physician Quality Reporting Initiative) on a voluntary basis. The Centers for Medicare & Medicaid Services (CMS) program provides incentive payments to eligible professionals who report data on quality measures. Providers also receive confidential feedback reports.

However, the Affordable Care Act established penalties for providers who do not successfully participate in this reporting system. That change in the program—from bonuses for voluntary participation to reductions in payment for nonparticipation—has increased the pressure on physicians to participate. It is important for the oncology community to keep abreast of how this program unfolds in the coming months, in order to prepare for any changes that might affect the delivery of care.

Prompt Pay Hurts Community Practices

Another issue that has been on ASCO’s front burner for numerous legislative calendars is the customary prompt pay discounts that are based on negotiated terms between the manufacturer and the distributor for payment within a certain time frame and represent the time value of money. These discounts are typically not passed on to the physician purchasing the drugs.

“Removing prompt pay from the average sales price formula for physicians creates a more accurate reimbursement for drugs, closer to the average sales price plus 106%, which we should be getting based on the 2003 Medicare Modernization Act, said Ms. Foster. She pointed out two bills currently in Congress: H.R. 905 and S. 733. These bills are bipartisan and were introduced by Representatives Al Green (D-TX) and Ed Whitfield (R-KY) in the House and Senators Debbie Stabenow (D-MI) and Pat Roberts (R-KS) in the Senate.

Cognitive Services Still Underreimbursed

Under certain Affordable Care Act provisions, Medicare will transition physicians to a value-based purchasing reimbursement system using quality and cost measures as calipers to gauge proper payment. Reimbursement will be tied to CMS reporting on physicians’ relative patterns of use—but it is unclear how this will be implemented as a way to pay for difficult-to-quantify oncology services.

To that end, Ms. Foster addressed a long-standing problem for oncology providers—getting proper compensation for cognitive services and other complex, difficult-to-bill practices. “We need to look at the reimbursement system differently. We should be paying oncologists for cognitive services, such as treatment plans,” said Ms. Foster.

Put simply, oncologists are reimbursed for evaluation and management, for administering chemotherapy drugs in the office setting (plus related services), and for the cancer drugs they purchase and deliver. However, all the other cognitive services, such as treatment planning, follow-up care, and survivorship support, are not adequately reimbursed. ASCO continues its efforts to educate lawmakers about the uncompensated services that are delivered every day in community practices.

Cuts to Oncology Impact Care

Ms. Foster acknowledged that gaining headway on tough-to-sell political issues such as adequate reimbursement for physicians is an uphill battle for the oncology community. “It’s not that we find policymakers unsympathetic to our concerns; it basically boils down to taking a back seat to the economic challenges of the day,” Ms. Foster explained.

In general, many of the issues and challenges in today’s tough environment have overlapping problems and solutions. ASCO and other major cancer organizations are working with bipartisan groups of policymakers to focus on developing ways to fairly compensate oncologists for delivering evidence-based, cost-effective quality care.

“We’re cautioning members from both sides of the aisle on the Hill that proposing wholesale reductions in funding and reimbursement for oncologists as a way to generate revenue will have the unintended consequence of hampering access to care for the nation’s patients with cancer,” concluded Ms. Foster. ■

Disclosure: Ms. Foster reported no potential conflicts of interest.

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