Adding On. So glad to see this research from Avalere conducted on behalf of the Community Oncology Alliance (COA) on the impact of the Inflation Reduction Act (IRA) negotiation on Medicare Part B provider reimbursement. While in Medicare Part D, negotiated prices do not factor into Average Manufacturer Price, the legislation is silent on whether Medicare Part B (provider-administered drug) negotiated prices factor into Average Sales Price (ASP.) The question among the wonky has been whether that was intentional or not. Some say it was written this way to drag down provider-administered drug prices overall, others say it was just a drafting error. If you want to learn more, I wrote about it here.
Avalere found that this could cost providers a minimum of $25 billion in add-on payments. COA is proposing that Congress legislate a technical fix that has manufacturers paying the negotiated price discount directly to the government. It is a good idea and one that would make way more sense in Part D as well (make it look like the coverage gap discount program) but that doesn’t seem to be the direction we’re headed. Fingers crossed.
Message (Not) Received. Kaiser Family Foundation polling points to a good thesis project for health science students – how to communication information in 2024. Despite all the media attention, <40% of voters are aware of the Medicare drug negotiations and, maybe more worrisome, 34% of voters over 65 know that there is an out-of-pocket spending cap in Medicare Part D.
Fun with Charts. Johnson & Johnson is out with their annual transparency report and it has some great nuggets – including that their rebates in 340B are HIGHER than in Medicare Part D. In 2023, they gave away $6B in 340B discounts/rebates. That is up from $2B in 2016. Add in all the other discounts/rebates ($42.8B) and it starts to make sense why list prices may seem high but there is seepage across the whole supply chain, just maybe not for patients. Out-of-pocket costs rose 26% for patients between 2016 and 2022. The whole report is worth flipping through.
Save for Later. Medicare Advantage is a policy fight that is going to happen sooner rather than later. This piece in Health Affairs covers the world of supplemental benefits (key driver of Medicare Advantage popularity) and a good thing to know/have around when the time comes to dive in.
Waiting. The landscape files are out! Soon we’ll start hearing more about the Medicare Part D plan designs for 2025 and I’m ready to learn about formulary coverage and benefit design decisions. Premiums went up but where and how much and what decisions were made by plans to mitigate the risk.
Prep Work. ICER is studying GSK products they believe will be part of the next round of Medicare negotiations.
What He Said. Brian Reid wrote about Senator Sanders and his lack of appreciation for intellectual property. It was exactly what was bugging me about the news of the day so I’m just sharing his and saying “ditto.”
Two other quick things to note from this week – Express Scripts is suing for the Federal Trade Commission to redact its PBM report saying it is defamation. Noisy news for those of us in the weeds already… Ozempic likely to be part of the next round of Medicare negotiation.