Oncology Stakeholders Summit, Fall 2015 - Episode 10

Drug Prices and Patient Burden in Oncology

Scott Gottlieb, MD, asked the panelists about the burden of drug costs for patients, seeking their opinion on the overall impact of oncology drugs on patient care and on plans.

John L. Fox, MD, MHA, explained that the Priority Health Plan includes Medicare, commercial products, and Medicaid, and each has been affected in a different manner. The heaviest burden, he thinks, falls on Medicare beneficiaries because there is no relief for the patients. On the commercial side, there are copay assistance programs for patients, but these undermine many of the management strategies for cancer drugs and other drugs. For Medicaid, the drug cost sharing is nominal.

Dr Gottlieb indicated that some legislative efforts have been made to address oncology drug costs for patients at the state level, especially with parity laws and caps on out-of-pocket costs. Kavita Patel, MD, MS, added that there has been a strong precedent set for this issue with the Affordable Care Act and the changes it has made in the private insurance market with out-of-pocket maximums. Most of this work, however, was predicated on in-network services, and that, at the federal level, out-of-pocket issues in out-of-network situations still have not been taken care of. States are then individually regulating pocket exposures to drugs, and this could pose a problem.

“I think what’s dangerous,” Dr Patel said, “is that because oncology is such a polarizing issue, they are sometimes being selective about the clinical indications of those drugs.” Looking at this at a policy level, and in narrow indication, is a mistake, she said.

Dr Fox pointed out further issues regarding selectivity, where youth cancer patients are noticed but patients with other diseases, who also require expensive drugs and biologic agents, are not recognized. Then there is the other issue with the parity laws, where the legislation does not address the real problem, the high cost of drugs, but shifts the cost to everybody else, either in the form of higher premiums or to taxpayers and employers.

In fairness to the proponents of the drug industry, Dr Gottlieb mentioned that spending has been relatively stable to the amount of money spent, and that drug costs are rising as other costs are obviated. The issue, he said, is with closed networks where once one goes out of the network, he or she does not receive coverage. The same concept applies with closed drug formulary, where if one has no coinsurance, he or she goes off the formulary, and Dr Gottlieb asked if this applied in an oncology situation, as well.

Dr Patel agreed that this is also a problem in oncology, citing the $250 cap that California has instituted, as an example. As such, there is a greater pressure for the federal government to follow suit. Yet because the government treads lightly when it comes to preempting states, Dr Patel said, she thinks we will continue to see state-by-state regulation rather than a federal push.