‘Most Favored Nation’ Rule Not Favored by Oncology Groups

Nov. 24, 2020
ASCO, Community Oncology Alliance oppose imposition of any mandatory demonstration projects on oncology practices, especially if they carry risk of harm to patients

Despite its stated goal of lowering drug costs, a new mandatory payment model from the outgoing leadership at the Centers for Medicare & Medicaid Services (CMS) is being panned by provider organizations and oncology associations. For instance, the Community Oncology Alliance called the so-called Most Favored Nation (MFN) drug-pricing model “brazen and unhinged.”

CMS recently announced the new payment model and issued a corresponding Interim Final Rule with Comment Period (IFC). Starting Jan. 1, 2021, the MFN Model will pay no more for high-cost Medicare Part B drugs than the lowest price that drug manufacturers receive in other similar countries.

As the New York Times has noted, the proposal is possible under a provision of the Affordable Care Act that allows Medicare to test policy ideas that improve patient care and save money. “But it is highly unusual because it would be established as a national, mandatory demonstration program. Most such projects have been set up as either voluntary or mandatory for only a random fraction of health providers, in order to study their effects.”

The Times quotes Peter Bach, M.D., the director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Hospital, as saying, “This absolutely prevents the experiment from yielding results that could be interpreted. They’re not even pretending it’s an experiment.”

Ted Okon, executive director of the Community Oncology Alliance, put out a statement noting that the model “not only threatens community oncology providers as they struggle to treat a majority of Americans with cancer during an unchecked pandemic, but it also brazenly bypasses existing law as established by the legislative branch of the government.

Rather than give community oncology providers the support they need during this third wave of the pandemic, as they struggle to keep their facilities and staff COVID-19-free while treating cancer patients, Okun added, “the Trump Administration is essentially throwing these providers under the bus. Forcing a radical change in the entire healthcare system during a global pandemic is not rational or safe. It puts politics over people.

A statement from Monica Bertagnolli, M.D., board chair of ASCO’s Association for Clinical Oncology, criticized the nationwide, mandatory demonstration that will be phased in over four years, with full implementation for the final three years of the seven-year model. “This plan effectively overrides a statutory provision under the guise of a demonstration project by imposing a new reimbursement model on cancer care absent any evidence that it can lower costs without negative consequences for Medicare beneficiaries,” she wrote. The model, she added, will cut reimbursement for a number of cancer drug treatments, which will limit access to care for Medicare beneficiaries.

“In fact, the MFN interim final rule acknowledges that ‘… a portion of the savings is attributable to beneficiaries not accessing their drugs through the Medicare benefit, along with the associated lost utilization.’ Patients with cancer require timely access to potentially lifesaving treatment, and limited and specific treatment options are often indicated,” Bertagnolli wrote. “That the rule plans for and achieves part of its savings by limiting or restricting access to care for nearly one in five patients is unconscionable and unacceptable. ASCO has engaged in good faith with the Administration on the shared goal of controlling the rising cost of drugs. However, ASCO has consistently opposed the imposition of any mandatory demonstration projects on oncology practices, particularly those that carry significant risk of harm to patients with cancer.”

Anders Gilberg, senior vice president, government affairs, for the Medical Group Management Association, also noted that the model will result in reimbursement cuts to medical practices treating some of the nation’s most vulnerable patients. “MGMA has long opposed mandatory untested models and questions how putting the onus on medical group practices instead of drug companies will ultimately solve the issue of high drug prices in this country,” Gilberg wrote. “We are concerned over the way in which this rule was issued, which provided no opportunity for input from medical practices and other key stakeholders before being finalized."

In a Health Affairs blog post, Rachel Sachs, J.D., M.P.H., an associate professor of law at Washington University in St. Louis, gives the administration credit for establishing Republican Party support for the idea of drug price controls. “But it is very disappointing to see the Administration choose to finalize these rules in ways that create serious legal jeopardy for their future implementation. Having released these proposals years ago, the Administration had sufficient time to finalize them through the standard administrative process,” she wrote. Sachs added that “HHS is correct that, for too many patients, the problem of high drug prices is one that urgently needs to be solved. But patients deserve better than this rushed lame-duck process. This administration could have delivered on its promises months or years ago.”

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