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.