Practice Manager Insider

CAP Enrollment Starts April 3, 2006

Physician practices can begin enrolling in the Competitive Acquisition Program (CAP) as of April 3, 2006. By that date, CMS expects to have posted on its website the names of participating CAP vendors for 2006, the categories of drugs that they will provide, and the geographic area in which each vendor will operate. Physicians then can choose the categories of drugs that they wish to receive from each vendor under CAP. Reports indicate that, initially, 182 Part B drugs and biologicals will be included in CAP.

For this first CAP cycle, which is a partial year running from July 1 through December 31, 2006, physicians have until May 18, 2006 to make their selections and there will be one category of drugs and one geographic area. Starting January 2007, the CAP cycle reverts to a calendar-year basis and elections will occur in the fall of each year.

CAP offers physicians the choice of obtaining certain drugs from vendors selected in a competitive bidding process, rather than buying and billing for these medications under the average sales price (ASP) system.

Will NCCN’s Drug Compendium Become a Source for Off-Label Coverage Determinations?

The Medicare Coverage Advisory Committee is meeting tomorrow, March 30, to consider whether to add a third source of information regarding coverage for off-label uses of anticancer medications. Practice Manager Insider will follow up on this story next week.

The law allows three drug compendia to be used in determining the “medically accepted indication” of agents used off-label in chemotherapeutic regimens. One of these, American Medical Association Drug Evaluations, is no longer published. The National Comprehensive Cancer Network (NCCN) is seeking recognition for its publication, NCCN Drugs & Biologics Compendium™. This resource is based on NCCN recommendations and practice guidelines, as well as FDA-approved uses. The NCCN guidelines are already an accepted tool in the 2006 CMS oncology demonstration project.

The other two compendia approved as sources for off-label coverage determinations are American Hospital Formulary Service Drug Information, and United States Pharmacopeia Drug Information. The latter will cease publication under that name and continue under a new name.

Calling All Practice Managers – Tell Us What You Want!

Practice Manager Insider is your blog – your forum. We need your input to serve you better. What do you want to read about? What news can you not find elsewhere? What do you think of the topics that we cover? Are they relevant to you? If not, what would be? Please tell us in the comments section so everyone can read them.

For example, what do you think about the following topics covered here recently:

• MedPAC recommendations – eg, don’t pay for demonstration projects, require Hgb levels on erythroid growth factor claims

• Reimbursement news – eg, Medicare expands coverage of PET

• New resources for practice managers – eg, NCCN guidelines coded to match the 2006 CMS Oncology Demonstration Project

• What the mainstream media says about oncologists – eg, “Reimbursement Sways Treatment Decision?”

Thanks in advance for your participation!

Less than 10% of Eligible Patients Screened for Colorectal Cancer in Federal Health Care Centers

The low proportion of patients screened for colorectal cancer comes from a study published in the current issue of the Journal of Health Care for the Poor and Underserved. Authors reviewed medical records of patients (N = 3416) receiving primary care at a federally qualified health center serving low-income neighborhoods in Chicago. By age and family history, 642 were eligible for colorectal cancer screening. Physicians recommended screening for 9.2% (n = 59); about 7% (n = 45) were screening appropriately. About three-quarters (76.2%) of patients for whom screening was recommended completed the suggested evaluation. Older patients were more likely than younger ones to have received a recommendation for screening and to actually be screened.

Most diagnosed patients receive quality care

Results of another survey of patient records (N = 1765) conducted to evaluate quality of cancer treatment provided were published recently in the Journal of Clinical Oncology. Patients with breast cancer received 86% of care recommended by the National Initiative for Cancer Care Quality. Those with colorectal cancer received 78% of recommended care.

March 22--Last Chance to Comment on Proposed HEDIS Changes

The National Committee for Quality Assurance (NCQA) has proposed changes to the recommended age ranges for breast and cervical cancer screening in the Health Plan Employer Data Set (HEDIS^®). NCQA is accepting comments about these proposals until 5 pm on Wednesday, March 22.

The first proposed change would broaden the age window for breast cancer screening from 50 through 69 years to 40 through 74 years. The revised lower age limit would bring HEDIS into line with recommendations from the American Cancer Society and the US Preventive Services Task Force (USPSTF). The increase in the upper age limit is based on a recommendation from the Technical Expert Panel and Committee on Performance Measures, which offers advice about HEDIS.

The second proposed change would raise the minimum age for cervical cancer screening from 18 years to 21 years, matching the recommendations of the American College of Obstetricians and Gynecologists, the ACS, and the USPSTF.

HEDIS is the tool used by most of the healthcare industry to measure health plan performance. NCQA manages the evolution of HEDIS.

NCQA prefers to receive comments by email. Click here for the comment page.

Oncology in the News: Reimbursement Sways Treatment Decision?

An analysis in the March-April issue of Health Affairs made the New York Times with the headline, “Pay Method Said to Sway Drug Choices of Oncologists”. Is this accurate?

The Health Affairs article examined the effect of physician reimbursement on choice of chemotherapy treatment for Medicare beneficiaries >65 years old (N = 9357) with various metastatic cancers. It covered a 3-year period (1995-1998) during which physicians were reimbursed based on the average wholesale price (AWP) for drugs administered in the office. The analysis concluded that the decision to administer chemotherapy was not influenced by higher reimbursement but that “providers who were more generously reimbursed…prescribed more-costly chemotherapy regimens to metastatic breast, colorectal, and lung cancer patients.” The New York Times article did not note that physicians are not currently reimbursed in this way.

The New York Times article creates a misleading impression, said Practice Manager Insider editorial board member Roberta L. Buell, MBA. The article “makes it seem that the only reason an antineoplastic agent is given is the drug profitability,” said Buell, vice president of P4 Healthcare, Sausalito, California. Based on her experience with drug hotlines, she said, “Oncology clinics everywhere work very hard to get patients who have no insurance or a non-covering diagnosis a supply of drug.  Sometimes this effort takes many hours of the clinic’s time. They make no money on this drug or the time spent trying to acquire it and, yet, the patient is treated. Most practices will go to great lengths to make sure a patient gets a novel agent regardless of profitability.”

The profit motive may enter “when two drugs are exactly alike and there is absolutely no difference in patient outcome,” Buell said. When the generic for paclitaxel became available, for example, it carried the same AWP as the branded version. “This was a corporate pricing move to generate clinic profits and was not a conscious decision by the provider. Yet, the provider absorbs the bad press, even though what they are doing is their prerogative in a free market economy,” she pointed out.

Another recent study has examined the impact of payer policies on physician treatment decisions and patient access to off-label therapies. This one was commissioned by the Association of Community Cancer Centers, the Biotechnology Industry Organization, and the Pharmaceutical Research and Manufacturers of America. It surveyed 28 oncologists and 12 oncology practice managers. Oncologists reported relying on peer-reviewed literature (89%), drug compendia (60%), drug manufacturer hotlines (25%), and case reports (25%) to make clinical decisions. Payer policies did influence whether decisions were carried out. About 54% said that Medicare non-coverage “frequently” or “very frequently” caused them to change their decision. The comparable figure for private payer policies was 28%.

Buell noted a systemic problem with drug pricing during the period covered by the Health Affairs study. “The RBRVS [resource-based relative value scale] pricing mechanism rewards procedural efficiency… but oncology is not procedure-based,” she said. For many years, drug profitability made up the difference between the RBRVS fee schedule and practice cost. Use of average sale price (ASP) and “better” coding for drug administration represent attempts to fix the problem of inadequate compensation for practice overhead. But so far, “these have not yet adequately done the job,” Buell concluded.

MedPAC: Limiting Patient Cost Sharing “Merits Further Study”

A Medicare Payment Advisory Commission (MedPAC) report to Congress expressed concern about Medicare patients’ growing and unlimited out-of-pocket costs for drugs used in cancer therapy. The commission found no cases where beneficiaries could not obtain chemotherapy but did note that persons without supplemental insurance were more likely to receive chemotherapy in hospital outpatient departments rather than in their oncologist’s office. Some oncology practices surveyed by MedPAC had stopped office-based treatment of Medicare patients without supplemental insurance, sending them to hospital outpatient departments or safety net facilities. Oncology practices that MedPAC visited estimated that 5% to 20% of their Medicare patients lack supplemental coverage, according to this report.

Practices also recounted instances in which a patient refused treatment in order to avoid traveling to a hospital or leaving their family with debts for out-of-pocket medication expenses, the report said. Some patients told the commission that they were concerned about exceeding lifetime caps on their retiree coverage.

Part of the commission’s efforts to compile the report included visiting community oncologists and hospital outpatient departments, and conducting focus groups with Medicare patients who received chemotherapy during the past year.

MedPAC noted that unpaid patient out-of-pocket costs become bad debt. Medicare pays 70% of hospital bad debt but does not cover such costs to physician practices, the report said. It concluded that changing benefit design to limit cost-sharing liability for cancer patients and others with sizable health care expenses “merit(s) further study.”

“This is an important recognition by MedPAC of the bad debt issue faced by physician practices,” said Practice Manager Insider editorial board member Elaine L. Towle, CMPE. Oncology organizations, practices and lobbyists have presented this information to Congress and to the Center for Medicare and Medicaid Services in the past, noted Towle, program director at Oncology Metrics. “Having it acknowledged by MedPAC is satisfying, and sends an important message to Congress,” she added.

How Oncologists Have Adapted to Medicare Payment Changes: A View from MedPAC

A recently released Medicare Payment Advisory Commission (MedPAC) report to Congress found that oncology practices considered 2005 Medicare payment changes significant, and detailed practices’ coping tactics. These findings come from a Congressionally mandated report evaluating the effect of changes in how Medicare pays for drugs administered by oncologists. Part of the commission’s efforts to compile the report included visiting community oncologists and hospital outpatient departments, and conducting focus groups with Medicare patients who received chemotherapy during the past year.

Oncologists and their office managers reported that some practices made the following changes to compensate for Medicare payment changes:

• Choosing drugs for treating chemotherapy side effects based on price
• Keeping smaller inventories of drugs on hand. This allows the practice to respond quickly to price changes and avoids tying up large sums of capital. They also took advantage of prompt pay discounts.
• Hiring financial advisers to work with patients and assess whether patients can pay out-of-pocket expenses. If patients have no supplemental insurance, the adviser determines whether the person qualifies for other assistance such as Medicaid or programs from pharmaceutical manufacturers. Practices may give patients a payment schedule for making copays.
• Replacing full-time employees with part-time employees
• Reducing employee health and pension benefits
• Replacing nurses with pharmacy techs
• Hiring employees to handle coding to free nurses for patient care
• Hiring a pharmacist to buy and mix drugs, and advise on drug purchases based on price and clinical effectiveness
• Purchasing positron emission tomography (PET) scanning for their offices and increasing imaging services

The report said that neither patients nor oncologists and office managers reported any decline in quality of care.

Board member analysis

This MedPAC report includes only partial Medicare claims data for 2005. Practice Manager Insider editorial board member Elaine L. Towle, CMPE, commented that “2006 is the real test” for payment changes instituted under the Medicare Prescription Drug Improvement and Modernization Act. She predicts a deteriorating situation this year, as the transitional add-on payment for drug administration services are no longer available and the 2006 demonstration project provides “much less money that the 2005 project.” 

Towle, program director at Oncology Metrics, foresees significant shifting of services from offices to hospitals and access problems, as “hospitals may not accept additional chemotherapy patients.” Small practices who were unprepared for these changes are already struggling, she said. “We are already seeing consolidations and practice closures. Quality of care should not suffer, but quality of the patient and provider experience may.”

MedPAC Recommendation: Require Hgb Levels on Erythroid Growth Factor Claims

The Medicare Payment Advisory Commission’s (MedPAC) recent report to Congress recommended requiring that patient hemoglobin levels be recorded on claims for erythroid growth factors such as epoetin alfa and darbepoetin alfa. Medicare payments for these growth factors rose from 2004 to 2005, while its expenses for chemotherapy drugs declined during that period. The US Food and Drug Administration has recommended a target hemoglobin level in cancer patients of ≤12 g/dL, and that growth factor be withheld if hemoglobin >13 g/dL, according to the MedPAC report. Data regarding hemoglobin values should be used as part of Medicare’s pay-for-performance initiative, the commission said.

Practice Manager Insider editorial board members Elaine L. Towle, CMPE, and Patricia P. Falconer, MBA, both predicted that this requirement would mean headaches for oncology offices. “The recommendation to include hemoglobin levels on growth factor claims will have a huge effect on office-based oncologists and will add one more hurdle to successful submission of clean claims to Medicare,” said Towle.

Falconer, president of Health Options, “strongly disagree[d]” with the recommendation. “This additional data requirement will add administrative costs to both the medical practices and the CMS [Centers for Medicare & Medicaid Services] intermediary.” She added that the recommended requirement “suggests that physicians are not adhering to clinical guidelines in their use of growth factors.” Guidelines for growth factor use are available from both the American Society of Clinical Oncology and the National Comprehensive Cancer Network, Falconer pointed out. “If CMS wants to address anemia management as part of Medicare’s pay-for-performance initiative, then CMS should add the anemia diagnoses to the current 13 diagnosis profiles in the demonstration project for 2006 and collect data on the utilization of growth factors and adherence to clinical guidelines,” she advised.

MedPAC Recommendation: Don’t Pay for Demonstration Projects

The Medicare Payment Advisory Commission’s (MedPAC) recent report to Congress recommended that Congress and the Centers for Medicare & Medicaid Services (CMS) should use demonstration projects not to increase payments and make payment policy but to test innovations in health care. The report evaluated the effects of changes in how Medicare pays for drugs administered by oncologists. Panelists noted that the 2005 quality of life demonstration project added about $200 million in payment to providers. Many physicians reported to MedPAC that they did not believe that the 2005 demonstration project would improve quality of care or provide useful information, but noted that demonstration project payments enabled them to continue to care for Medicare patients.

Practice Manager Insider editorial board members Larry A. Oday and Elaine L. Towle, CMPE, concurred with this advice. “Payment for demonstration projects is good incentive for participation,” said Towle, program director at Oncology Metrics. But “the current Medicare payment system needs fundamental change, not year-to-year Band-Aids in the form of demonstration projects.”

Oday, a Washington-based health care attorney, had this comment regarding the demonstration projects: “CMS is abusing its authority. If it can [use its authority] to give money, it won’t hesitate to use it to take money away. Demos are, by definition, an experiment. They are not to be used for political pork barrel.”

MedPAC also recommended an exception to the Competitive Acquisition Program (CAP) oncology drug delivery rules for rural practices. Under the existing rule, drugs must be delivered to the site where the medications will be administered. Rural practices often administer drugs in satellite offices at which they cannot receive and mix medication. MedPAC recommended that CMS allow such practices to accept drug deliveries at their main offices so that they can participate in the CAP.

Towle predicted that this will have limited effect on CAP participation. “While I believe that very few medical oncologists will choose to participate in the CAP program, the recommendation regarding rural practice sites may influence this decision for some,” said Towle.