Writing for Morning Consult, Dr. Lucy Langer, a clinical oncologist with Compass Oncology in Portland, Oregon, applauds the administration’s goal of lowering drug prices, but warns of the dangers associated with proposals like the International Pricing Index (IPI) that will – in the words of Dr. Langer – “do more harm than good.”
“[T]he administration announced its intention to lower the reimbursement rates of certain physician-administered drugs by basing reimbursement for these medications on the average price paid by 16 other 'economically similar' countries. However, these countries — which may include nations such as Denmark, Belgium and Greece — often set artificial price controls and certain access constraints that could threaten my patients’ ability to obtain important cancer therapies.”
Pointing to a recent study by researchers from Avalere Health, Langer challenges the Centers for Medicare & Medicaid Services’ (CMS) claim that the IPI model will reduce drug costs.
“According to [the] findings, since a substantial majority of seniors enrolled in Part B have supplemental insurance plans such as Medicaid, Medicare Advantage and employer-sponsored care, the cost sharing associated with these auxiliary plans already covers the out-of-pocket payments the IPI model seeks to lower. Thus, if the model were to go into effect, less than 1 percent of seniors in Medicare would see any kind of savings for the 27 drugs included in the proposal. Thus, the IPI Model, regardless of all the noise, would do little to lower drug costs for Medicare patients.”
Advocacy groups representing patients, providers, and physicians across the nation, as well as BIO, echoed the concerns of Dr. Langer about the IPI model.
“We believe that the Model as written could actually make it harder for cancer patients, especially those living in rural areas, to find the right provider to treat their cancer with the right drug. We cannot sacrifice this patient access for program savings that may or may not materialize, based on price-setting processes that no American citizen can control.” – American Cancer Society Action Network
“We are greatly concerned that the IPI Model, which would conduct nothing short of a mandatory national experiment on Medicare Part B beneficiaries, could disrupt access to the innovative therapies and care that vulnerable seniors with cancer and other serious diseases need and are guaranteed under Medicare.” – Community Oncology Alliance
“[FAH is] very concerned that the system CMS is planning to implement will be highly disruptive to the current Part B drug distribution system and will be more burdensome, rather than less burdensome, to the hospitals and physicians that will be mandated to participate in the model. Further, FAH is concerned that the model may increase international prices rather than lower U.S. drug prices and potentially increase US prices for physicians and hospitals not within the bundle.” – Federation of American Hospitals
“The type of price control proposed via the IPI would discourage the development of innovative new drugs and could create drug shortages, the kind that are commonplace in countries with socialized, government-run medical systems.” – Independent Women’s Forum
“We believe new models must support innovation; enhance the alignment of incentives; incorporate key perspectives to define high-value care; focus on outcomes that matter to patients; and construct efficient arrangements between payers, drug manufacturers, and other stakeholders. The IPI Model for Medicare Part B described in the ANPRM is not a model we can support when viewed through this lens.” – Personalized Medicine Coalition
For a better approach, policymakers should consider market-based policies designed to ensure all patients have access to affordable, innovative cures and treatments. President Trump’s commitment to lowering health care costs for the American people is encouraging, but implementing shortsighted legislation like “fail first” or the adoption of foreign price controls is dangerous for patients in need. As Dr. Langer writes:
“Reducing the cost of care for patients is of paramount importance to myself and others, but we cannot address big problems with solutions that compromise patient care.”