Medicare facing cancer, cardiac care cuts

[gdpawel]

Mayo said it will continue to accept Medicare for critical care and specialty services as well as lab services and physical therapy—but not routine primary care.

Over 50% of their practice is taking care of Medicare patients. Primary care is a small component of their practice, so apparently that is why Mayo decided to pull back on primary care, while continuing to provide critical care.

http://takingnote.tcf.org/2009/10/ma...-patients.html

[gdpawel]

Oncotech was an American laboratory providing individual chemoresponse testing as a service to patients and physicians since the mid-1980s. It was co-founded by Drs. Robert Nagourney and Larry Weisenthal. They each left the company in the early 1990s, over disagreements with the controlling investors (4 venture capital companies) over the management and directions of the company. Dr. Weisenthal remained supportive of the company, over the years, and played an important role in securing and, later, retaining reimbursement by Medicare for their services. Drs. Nagourney and Weisenthal each started their own small private laboratories to offer related cell culture testing services.

Oncotech continued operations as a privately-held, venture-capital controlled company until February of 2008, when it was acquired by a Danish biotechnology company called Exiqon, Inc. for $45 million (US) in Exiqon securities.

Exiqon replaced the Oncotech CEO and installed its own management team, continuing to operate Oncotech as a wholly-owned subsidiary, with a business model centered around providing chemoresponse assays on a (US) national basis — importantly to Medicare patients.

In the case of Weisenthal Cancer Group, they opted out of Medicare, effective July 1, 2008, because the reimbursements received from Medicare did not cover our costs of providing our services (although they are still required to file a Medicare claim on your behalf).

Exiqon Oncotech, however, depended on Medicare reimbursement to support its business model. In the USA, Medicare coverage decisions for many types of medical services are made at the regional level (Local Coverage Decision or LCD), by the private insurance companies with which Medicare contracts to administer services to Medicare beneficiaries. Previous Medicare contractors for California made the determination that chemoresponse assays qualified as a Medicare covered service. These included the TransAmerica and National Heritage Insurance (NHIC) companies. Most recently, an insurance company called Palmetto was awarded the contract to administer Medicare services for California. Palmetto made the decision to discontinue Medicare payment for chemoresponse assays in California.

Last week, Exiqon Oncotech announced that it was discontinuing operations, because of the withdrawal of Medicare reimbursement for its services. This was an entirely understandable, if regrettable, decision. What was in no way understandable — or defendable, for that matter — was the way that they ceased operations.

Exiqon Oncotech sent out notifications to its client physicians that it was ceasing operations, virtually immediately. On a single day this past week, they received two dozen specimens from human tumor biopsies via FedEx and other couriers. All of these specimens were simply sent back to the hospitals and clinics which sent the specimens. Physicians were told that there were no other laboratories who could perform the tests requested.

While it is true that no other American laboratories have chosen to utilize Exiqon Oncotech’s non-proprietary technology for chemoresponse assays, it was well known to Exiqon Oncotech that there are a number of highly experienced, well qualified, well-published American laboratories which provide this service, utilizing different, but at least comparably valid, technologies (cell-death as opposed to cell-growth endpoints).

There have been only two previous, investor-backed, clinical laboratory companies which provided chemoresponse assays as a service to patients, only to make the decision that their business models were no longer viable. These companies were Analytical Biosystems and NuOncology Laboratories. When these latter companies ceased operations they did so in an orderly fashion, giving their clients adequate advance warning and winding down operations at a pace which enabled them to provide testing for those patients and physicians who had already planned and depended upon receiving these services, and these companies were open and helpful in providing their former client physicians with contact information for other laboratories within the US which continued to provide chemoresponse assay services.

In the case of Exiqon Oncotech’s two dozen tumor specimens simply marked “return to sender,” It can scarcely be imagined anything more irresponsible. In many of those cases, doubtless the physicians and/or surgeons discussed in advance with their patients the importance of sending their biopsies for cell culture analysis. In some cases, the surgical procedure may have been performed primarily for the purpose of this analysis. In other cases, the patients were doubtless comforted by knowing that this testing was to be performed.

Business is business, but, at a certain point, business is also about people, and cancer business is, or should be, about cancer patients.

Many are saddened by the shuttering of Oncotech’s doors, 25 years after its founding, and are ashamed at the way in which those doors were apparently shutterd.

It should be noted that the Medicare contractor for the state of Pennsylvania continues to provide coverage for chemoresponse assays and that there is an experienced laboratory in Pennsylvania (Precision Therapeutics) which both provides the assays and accepts Medicare reimbursement as payment in full. California laboratories continuing to provide chemoresponse assays with functional profiling (without Medicare reimbursement, possibly requiring patient payment for services) include Rational Therapeutics, Anticancer, Inc., and Weisenthal Cancer Group.

This has been a double sign of irresponsibility, not only on what Oncotech did, but on what Palmetto GBA did.

The previous CMS administrator for Medicare in Southern California (NHIC) spent almost the entire 2006 doing a extensive, transparent tech assessment of chemoresponse assays and made the decision that the assays were a perfectly appropriate medical service, worthy of coverage on a “non-investigational” basis.

What was of particular significance this time (as compared to approval for the resistance part of the testing in 2000) was that they abandoned the artificial distinction between “resistance” testing and “sensitivity” testing and provided coverage for the whole FDA-approved kit.

Why it was a local coverage decision (LCD) and not a national coverage decision (NCD)? Medicare has only about 20 doctors and 40 total clinicians working in its coverage office.

Also, Medicare doesn’t have a single oncologist on staff, yet since the year 2000, they issued 165 restrictions and directives on the use of cancer drugs and diagnostic tools. Private insurers (like NHIC), on the other hand, employ thousands of doctors and nurses to do this.

Medicare wants to put off-lable drug decision making (which some 60% of cancer drugs are) in the hands of compendia writers in the private sector, many of whom are on the payrolls of the companies that make the drugs. I am just wondering if this had anything to do with what Palmetto GBA is doing?

It amazes me that they don’t emphatically mandate this testing as a requirement for obtaining chemotherapy reimbursement against ill-directed treatments. Evidence in support of these tests is more than sufficient to justify them, particularly in light of the Duke University impact study of chemoresponse assays on the treatment costs for recurrent ovarian cancer.

Impact of a chemoresponse assay on treatment costs for recurrent ovarian cancer.

Havrilesky LJ, Krivak TC, Mucenski JW, Myers ER. Division of Gynecologic Oncology, Department of Obstetrics and Gynecology, Duke Comprehensive Cancer Center, Duke University Medical Center, Durham, NC.

Objective

We sought to estimate mean costs of chemotherapy treatment for recurrent ovarian cancer with or without use of a chemoresponse assay.

Study design

We estimated mean costs for 3 groups: (1) assay assisted: 75 women who received oncologist’s choice of chemotherapy following chemoresponse testing (65% adherence to test results), (2) assay adherent: modeled group assuming 100% adherence to assay results, and (3) empiric: modeled from market share data on most frequently utilized chemotherapy regimens. Cost estimates were based on commercial claims database reimbursements.

Results

The most common chemotherapy regimens used were topotecan, doxorubicin, and carboplatin/paclitaxel. Mean chemotherapy costs for 6 cycles were $48,758 (empiric), $33,187 (assay assisted), and $23,986 (assay adherent). The cost savings related to the assay were associated with a shift from higher- to lower-cost chemotherapy regimens and lower use of supportive drugs such as hematopoiesis-stimulating agents.

Conclusion

Assay-assisted chemotherapy for recurrent ovarian cancer may result in reduced costs compared to empiric therapy.

PMID: 20417480

[gdpawel]

It was noted above, the Medicare contractor for the state of Pennsylvania continued to provide coverage for chemoresponse assays and that there is an experienced laboratory in Pennsylvania (Precision Therapeutics) which both provided the assays and accepted Medicare reimbursement as payment in full.

The California laboratories that continued to provide chemoresponse assays with functional profiling (without Medicare reimbursement, possibly requiring patient payment for services) included Rational Therapeutics, Anticancer, Inc., and Weisenthal Cancer Group.

It looks like Novitas Solutions, Inc. (formerly Highmark Medicare Services) has arbitrarily made the decision, like Palmetto, GBA did in California, to discontinue Medicare payment for chemoresponse assays done by Precision Therapeutics in Pennsylvania.

The rationale for the non-coverage decision is totally bogus. It's a shame. The biggest thing is that the "expert reviews" upon which they rely on made no attempt whatsoever to determine the "accuracy" of the tests being evaluated.

They all used the phony, made-up criterion of test "efficacy" -- demanding rigorous proof that the use of the tests improves outcome -- which is a standard not achieved by any of the large number of laboratory tests currently used to assist in treatment/drug selection in oncology -- or for that matter, in medicine in general.

The only criteria ever used to evaluate laboratory or radiographic tests has been the accuracy of the tests. And this criterion was totally ignored in the reviews. They just made up their minds in advance that they didn't want to pay for the tests.

ASCO made up its mind in advance that it didn't want to have anything to do with the tests (for a lot or reasons, including the certainty that it would siphon patients away from their clinical trials). So they erected an impossibly high bar.

One of the major reasons academic cancer institutions don't like in vitro chemosensitivity test is that it may be in direct competition with their randomized controlled clinical trial paradigm - a fiercely defended relic of their ignorance.

Cell culture assay measure the "efficacy" of anti-cancer drugs. The randomized clinical trial measures the "efficacy" of anti-cancer drugs. And the new molecular testing rates the "efficacy" of population research vs rating the "efficacy" of drugs "actually" tested against an individual's cancer cells.

The oncologist’s trade group, American Society of Clinical Oncologists (ASCO) says oncologists should make chemotherapy treatment recommendations on the basis of published reports of clinical trials and a patient’s health status and treatment preferences. All the rigorous clinical trials identified are the best treatments for the “average” patient (do cancer cells like Coke or Pepsi). But cancer is far more heterogeneous in response to various individual drugs than are bacterial infections. The tumors of different patients have different responses to chemotherapy.

The ASCO tech assessments say that chemotherapy sensitivity and resistance assays (CSRAs) should not be used outside the confines of a clinical trial setting. The same people who maintain that assay-directed therapy should not be used until proven in prospective randomized clinical trials, are the same people whose entire careers are utterly dependent upon mega-trials 100% funded by pharmaceutical companies (that, plus fees from speeches they give for these companies), are the same people who control the clinical trials system, the grant review study sections, and the journal editorial boards.

No wonder ASCO doesn’t recommend the use of CSRAs (no matter how good they are) to select chemotherapeutic agents for individual patients outside of the clinical trial setting. Besides the authors of these tech assessments trying to invent a brand new criterion for validating a laboratory test, they’d like to have these tests in clinical trials. Tens of thousands of scientists pushing a goal of finding the tiniest improvements in treatment rather than genuine breakthroughs that fosters redundant problems and rewards academic achievement and publication above all else.

Why is ASCO (and others) protecting the status of treatments which are only marginally and minimally and inconsistently effective? This prevents serendipitous and fortuitous discovery. Truly effective treatment don’t need prospective randomized trials. Even ASCO points out, because the number of available chemotherapeutic agents has increased enormously over the past few years, the emphasis on the rationale for these assays have never been stronger. As the number of possible treatment options supported by completed randomized clinical trials increases, the scientific literature becomes increasingly vague for guiding physicians.

With all these uncertainties, would it be wrong to make a clinical decision based on CSRAs? Should it be denied to patients who walk in the door asking for it? Patients who want this testing, after a thorough discussion about the peer-reviewed studies and experience that supports it, should not be hindered by restrictive ASCO policy. I never heard that ASCO had been knighted a regulatory agency.

Until the controlled, randomized trialist approach has delivered curative results with a high success rate, the choice of physicians and patients to integrate promising insights and methods like chemoresponse assays, remains an essential component of this kind of treatment technology.

Michael Castro, M.D., stated on the Rational Therapeutics blog, "In 1992, the Church publicly forgave Galileo for his “crime” of the heliocentric theory…a lesson in the slow pace of circumspection by authoritative bodies… seems we haven’t yet overcome an analogous religious intolerance in medical oncology and I’m not holding out for an apology from ASCO any time soon, but eventually it may come… Certainly, the insistence on population medicine at a time when the technology for individualized medicine has arrived borders on religious intolerance, not the scientifically curious patient advocacy patients want and naively expect… I’m afraid this intolerance is buttressed by the economic incentives of giving drugs to as many individuals as possible – a double problem…."

https://www.novitas-solutions.com/po...ab/l32571.html

[gdpawel]

Robert A. Nagourney, M.D.

An article by Scott Gottlieb, MD, in Forbes (Medicare Nixes Coverage for New Cancer Tests), described Medicare reimbursement for new molecular diagnostics. As many readers are aware, there have been a growing number of diagnostic tests developed and marketed over recent years designed to identify and monitor the progress of cancer. Many of these tests are multiplexed gene or protein panels that identify prognostic groups using nomograms developed from prospective or retrospective analyses. The 21-gene Oncotype DX and related Mammoprint, are among the most widely used. Related tests for lung, colon, and other cancers are in development.

With the explosion of assays designed to personalize cancer care, comes the expense associated with conducting these analyses. Medicare, as the largest provider of medical insurance in the United States, is at the leading edge of cost containment. Not surprisingly, HHS has a jaundiced view of adding tests without clear cost benefit.

The issue is far broader than cost analysis. It goes to the very heart of what we describe as personalized medicine. Every patient wants the right treatment for their disease. Every laboratory company wants to sell their services. Where the supply and demand curve meet however, is no longer set by market forces. In this instance, third party reimbursers set the fee and the companies then need to determine whether they can provide their service at that cost.

The problem, as with all economic analysis, is meeting patient’s unlimited wants with limited resources. Two solutions can be envisaged. On the one hand, medical care progressively moves to a scenario of haves and have nots wherein only wealthier individuals can afford to obtain those drugs and interventions that are beyond the price range of most. On the other hand, care is rationed and only those treatments and interventions that rise to the highest level of evidence are made available.

While the subject of this article was sophisticated diagnostic tests, it will only be a matter of time before these same econometric analyses begin to limit the availability of costly drugs like highly expensive targeted agents. In a recent editorial published in blood, leading leukemia experts pointed out that 11 of the 12 recently approved drugs each cost $10,000 or more per month.

As we examine the rather grim prospect of unaffordable or rationed care, a glimmer of hope can be seen. Using expensive and relatively insensitive molecular diagnostic tests to select expensive targeted agents could be replaced by less expensive testing platforms. The dramatic, yet brief responses observed for many targeted agents reflect the shortcoming of linear thinking applied to the manifestly non-linear human biology, characterized by cross talk, redundancies and unrecognized hurdles. To address these complexities phenotypic analysis (the phenotype being the end product of genomic, transcriptomic and proteomic events) provide global assessments of tumor response to drugs, combinations and signal transduction inhibitors. These more discriminating results identify cellular response at the level of biology, not just informatics. While it is theoretically possible that high-throughput genomic analyses using neural networks and high throughput computer analyses may ultimately provide similar information, it is unlikely that most patients will have ready access to a Cray computer to decipher their results.

We need to stop working hard and start working smart. The answers to the many questions raised by the Forbes article regarding resource allocation in cancer treatment may already be at hand.

* The Cray computer is an American supercomputer

[gdpawel]

Scott Gottlieb, MD

Medicare has sharply changed the way it pays for diagnostic tests, cutting payment rates and curtailing coverage for some new tests altogether.

The makeover in the way that Medicare reimburses molecular diagnostics has been foreshadowed for years, but was abruptly put into effect this summer.

Affected are the kinds of tests that probe for gene and protein markers found in our body’s tissues. These tests help doctors diagnose a multitude of diseases and monitor our response to drug treatments. They are used in a variety of medical settings. Some of their greatest promise has been in personalizing the treatment of cancer by tailoring drug therapies to a person’s unique tumor type.

The labs that perform the test are the same outfits that market them. The tests are typically sold as a laboratory service, rather than marketed as a medical device.

The new payment system has cut payment rates across the board, by an average of about 20% (and as high as 80% in some cases) from 2012 levels. Most of the new rates are being based on the work of one Medicare contractor, Palmetto GBA.

Hardest hit by the change, however, are many new diagnostic tests that aren’t yet a part of routine medical practice or may only benefit a small patient group, often with rare disease states. These diagnostics are being dubbed “tier 2” tests since they weren’t assigned discrete “codes” under the AMA’s new coding scheme.

In many cases, that also means that they haven’t been assigned a payment rate.

These tier 2 tests can try to file for Medicare payment under a so-called “miscellaneous” code for new tests. But that is often a dead end. In many cases, Medicare carriers have stopped paying for novel “tier 2” altogether, even tests that were previously reimbursed under the old scheme.

All of these tests typically probe for novel markers, or for a panel of (multiplexed) gene or protein markers whose combination of outputs are used to make predictions about things such as the potential for cancer to spread or respond to a medicine.

Previously, these tests were reimbursed under a “code stack” system that based payment rates on a sum of the cost of each of step used in conducting a particular test. Code stacking had a lot of problems. For one thing, the payment rates didn’t reflect the clinical value of a test, just the cost to perform it. The system also obscured from Medicare’s view what the agency was ultimately paying for.

When a bill arrived at Medicare, it merely listed the different markers that a particular test was probing for, and the laboratory steps being taken to identify these genes or proteins. Ultimately, the “code stack” didn’t reveal to Medicare what the test actually set out to do, and how doctors were using it.

So Medicare is replacing the ambiguous code stacks with a new set of discrete CPT codes that identify each common test by its own billing number. These codes are established by the American Medical Association at the behest of the Medicare agency. The AMA CPT Editorial Panel, which administers the development of new codes (but not reimbursement) for Medicare and all payers, made its first serious effort to come up with a new list of discrete codes back in 2010. After a long delay, the first tranche of 116 “tier 1” discrete codes finally went into effect January 1st.

As I wrote in an earlier article for Forbes, reimbursement for many of the tests were put on hold altogether while Medicare figured out what payment rates it wanted to assign to its new codes. Those rates are now starting to emerge, and the money is finally starting to flow again, although not all of the tests that fall under these “tier 1” codes are being reimbursed.

But the situation is even worse for tests that didn’t get one of the new codes. These novel tests don’t fit into one of Medicare’s new buckets. Many aren’t getting paid for.

This is having a profound impact on investment, and in turn, continued innovation and development. The policy change ends the established model for how novel tests got introduced into medical practice. With no suitable alternative, the new scheme will thwart the introduction of novel diagnostics and limit bets on new technology.

Labs traditionally don’t get paid for research and development. Nor are the sunk costs of R&D fully baked into the price of newly launched diagnostics. In this way, the pricing of diagnostic tests is very different than the pricing of drugs.

Except for a few exceptions, the intellectual property supporting a new diagnostic test is easy to engineer around. So it doesn’t support premium pricing for a new test.

As a result, most diagnostics get priced based on some measure of the cost of performing a test, not the cost it took to develop the novel diagnostic. So paying for diagnostic tests early in their product life cycle, before the clinical utility of a new test was fully demonstrated to Medicare’s approval, was a way of funding that R&D.

Early adoption of tests, often by clinical thought leaders at academic medical centers, wasn’t just a way to offset the cost of developing a new test. It also gave doctors a chance to start incorporating a new test as a part of medical practice. It enabled some doctors to practice medicine at its cutting edge. Typically academic doctors expert on a new marker were able to deploy a test and refine its role in medicine.

[Rich66]

Reviewing the info in this thread, this latest Mayo announcement seems fairly predictable. And that's in a mixed reimbursement system that shifts costs to private insurers. Primary care today, cardio and oncology tomorrow? I hope I'm wrong. But I've already been directly involved with a treatment center that had to look at their Medicare/private ratio before they could reserve an appointment for my mom. That was in Nov '08. A month ago, a cardiologist point blank told me my father's need for a defibrillator (vs pacemaker) had to be measured against "rationing" guidelines of Medicare. I didn't use the word, he did. The issue isn't feeling very abstract or academic to me.