This Week in Managed Care: July 27, 2018

This week, the top managed care stories included CMS reversing its decision to suspend the risk adjustment payment program; out-of-pocket costs and copayment accumulators put an HIV prevention drug out of reach for patients; research finds geography can determine posttreatment imaging for women with breast cancer.

Health plans will get risk adjustment payments, a pharma giant blasts plans to import drugs, and out-of-pocket costs are hampering HIV prevention.

Welcome to This Week in Managed Care, I’m Laura Joszt.

Risk Adjustment Payments to Be Reinstated

CMS this week reversed a decision to halt payments to health plans that take on higher-risk patients.

The risk adjustment payment program, created under the Affordable Care Act, was designed to prevent health plans from avoiding the sickest patients. But CMS had suspended the 2017 payments after a New Mexico court decision. Now, a rule issued late Tuesday will restore the payments starting in October.

Said CMS Administrator Seema Verma: “This rule will restore operation of the risk adjustment program and mitigate some of the uncertainty caused by the New Mexico litigation. Issuers that had expressed concerns about having to withdraw from markets or becoming insolvent should be assured by our actions today. Alleviating concerns in the market helps to protect consumer choices.”

Criticism for Drug Import Proposal

Pharmaceutical giant Eli Lilly has criticized a Trump administration proposal that would allow limited imports of drugs, saying it is “the wrong road to go down.”

During a ratings call, Lilly Chairman and CEO David Ricks called imports a regulatory failure, even in the limited circumstances proposed by the administration, such as when prices are suddenly raised for a drug available from only one source.

Said Ricks: “We are shifting too much of the cost via list pricing directly to consumers. If consumer pricing came down, [it] would improve volume and medication adherence for patients.”

Ricks’ comments drew attention because the import proposal came from HHS Secretary Alex Azar, who ran Lilly’s US Division before joining the Trump Cabinet.

Access to PrEP

Use of pre-exposure prophylaxis, or PrEP, has soared in recent years, and public health officials promote use of the drug among at-risk youth and adults to prevent the spread of HIV. But now, changing health benefit designs are catching PrEP users off guard.

While Gilead offers copay assistance toward the $1600-a-month cost of therapy, some plans have implemented copay accumulator features that cause the assistance to max out after 4 months. And the copay assistance does not count toward the plan deductible, leaving patients, who are mostly gay men, with the entire bill.

Activists say these policies make no sense given the cost of HIV to health plans, which can be $400,000 over the lifetime of the disease.

Said Michael Kharfen of the Washington, DC, health department, “This is truly the first medical intervention we’ve had to prevent HIV in the entire history of the epidemic. We’ve had other tools to prevent HIV acquisition or transmission, such as condoms or clean needles for those using drugs, but we’ve never had an opportunity like this.”

Read more.

Posttreatment Imaging After Breast Cancer

When it comes to early-stage breast cancer, where you live can determine what kind of imaging you receive. A study of 36,000 women found that some women are not receiving dedicated breast imaging, while others receive high-cost nonbreast imaging that may offer no benefit.

The study in the Journal of the National Comprehensive Cancer Network raises important financial, medical, and ethical issues, because oncology imaging costs are rising at twice the rate of overall cancer care costs.

Of the 36,000 women in the study, 24,000 had a diagnostic mammogram, 11,400 had a high-cost imaging procedure, and nearly 5,000 had a positron emission tomography (PET) scan.

While guidelines support routine mammography based on age and risk factors, nonbreast surveillance imaging such as whole-body PET scans have shown no benefit in terms of quality of life or survival for patients with stage I to stage III metastatic disease.


Finally, FDA Commissioner Scott Gottlieb, MD, will hold a hearing September 4 on the Biosimilar Action Plan unveiled last week.

The plan featured 4 main elements:

  • Improve efficiency in the approval process
  • Maximize scientific and regulatory clarity
  • Develop better communication among all stakeholders
  • End gaming of FDA requirements to promote competition

You can learn more about what’s happening in the world of biosimilars by visiting AJMC’s sister website, The Center for Biosimilars®.

For all of us at the Managed Markets News Network, I’m Laura Joszt.

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