Managed Care - November 2008 - (Page 34)

800-pound gorilla and establish the trend for private payers. A good 40 percent to 50 percent of health plans have basically gone to ASP.” The more private plans that make the shift to the Medicare formula, says Matt Farber, manager of provider economics and public policy at the Association of Community Cancer Centers, the tougher the arrangement for physicians. “You can imagine that if all payers shift over to that system,” says Farber, “it will create a major problem.” Meanwhile, in Iowa That economic lesson has not been lost on the health plans in Iowa. “We, the Iowa Oncology Society, met with Wellmark Blue Cross & Blue Shield and talked about our ASP pricing problem,” says Kovach. “They felt an extra 30 percent was a fair price. We felt good with that. I feel that was a pretty generous offer.” Other oncologists have been doing the same with other carriers, he adds, negotiating an ASP premium ranging anywhere from 10 percent to 22 percent. “Medicare really changed their world,” says Sheryl Nuzum, group leader for network economics at Wellmark in Iowa. And not for the better. “I don’t think it’s limited to oncology,” he adds. “We’re making up for differences of what Medicare doesn’t pay. It’s no secret. It’s just a question of how much. And under what reimbursement code.” Wellmark isn’t just beefing up reimbursements for cancer drugs. It’s also paying more for professional oncology services. And that includes finding a way to pay doctors for planning patient treatments. But it’s not a panacea. “Even at our rate, they tell me they’re under water on some drugs. I don’t think we’re done yet,” Nuzum adds. “If you look out at the pipeline of drugs to be introduced, almost all of them are cancer drugs, and they’re very, very expensive.” Not all doctors, though, are happy with manage care’s response. “Medicare is the basis on which everything else is negotiated,” says Marsland. “The private insurance payers are tending to follow Medicare trends and a number of them are switching over to ASP systems. There are some at ASP plus 6. And we basically tell them we aren’t taking that. It varies from contract to contract, but we shoot for ASP plus 10 percent to 15 percent. And what we’ll sometimes do is look at the total book of business. If they don’t want ASP plus 15 percent, but ASP plus 8 percent, and they won’t budge, we’ll say you need to pay more on the administration fee. We need 150 percent to 170 percent of Medicare.” Not all health plans have a problem with Medicare’s approach. “We’re using some of the same ASP pricing, but not to the extent Medicare is,” says Richard Bruzek, vice president for pharmacy at the not-for-profit HealthPartners in Minnesota. “I kind of agree with Medicare’s approach. It is equitable. But we don’t just believe in squeezing the entire balloon. We are trying to maintain their practices. We do make up for it on the drug administration side.” Even with the reimbursement strategy, he adds, the price of cancer drugs presents a painfully serious issue for payers. “Our total drug trend last year was less than 2 percent,” says Bruzek. “But if you look just at oncology drugs, there was a 25 percent increase. That’s substantial and points to the fact that more expensive biologics are being used — and hopefully producing better outcomes.” Hospitals, meanwhile, may soon find it harder to take any money-losing referrals. Farber notes that oncology drug reimbursements for in-patient treatment in hospitals are already at ASP plus 5 percent, and that is slated to be cut to 4 percent. Legislation afoot Doctors aren’t waiting. There are companion bills in the Senate and House — S1750 and HR1190 — that take aim at the reimbursement policies, says Okon. A separate effort is aimed at fixing what oncologists see as a problem with the prompt-pay calculation. Perhaps a new era of personalized medications will eventually point the way to a new approach, says Marsland. New insights into genetics and molecular science can give the best and brightest oncologists an advantage in improving responses for cancer patients. By reimbursing doctors for their successes in treating cancer, rather than just paying a fee for each service, the best doctors could make more and the worst doctors would be encouraged to learn more. “Will we ever see that happen? Probably not,” Marsland says with a laugh. “But those are the kind of societal issues that we ought to look at.” MC 34 MANAGED CARE / NOVEMBER 2008

Table of Contents Feed for the Digital Edition of Managed Care - November 2008

Managed Care - November 2008 Editor’s Memo Contents News and Commentary Legislation & Regulation Letters Medication Management Compensation Monitor Do It Yourself for Less Biomarkers Promise, but Do They Deliver? Oncologists Complain About Drug Payment Consider Blood Pressure Self-Monitoring Q&A: Keep Industry in the Game Formulary Files Plan Watch Tomorrow’s Medicine Outlook Respiratory Syncytial Virus Managed Care Considerations Contents Continuing Education Objectives RSV Disease in the Pediatric Population In the Trenches RSV Infection in the Adult Population Health Plan Medical Director Health Plan Pharmacy Director RSV Issues and Solutions Assessment/Evaluation/Certificate Request Post-Test

Managed Care - November 2008

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