High drug costs on doctors and patients, and other top line issues for 2018

By: Dr. Angus Worthing MD, FACP, FACR
Washington is back to work after the holiday recess and they’re busily trying to avoid a government shutdown on January 19. This week will likely see a short-term continuing resolution (“CR”) to keep the government running at current funding levels through mid-February. At some point, it would be great for Congress to pass a budget (instead of a CR) in order to enact bipartisan plans to increase biomedical research funds through NIH. Several important issues are complicating negotiations for the CR and budget including DACA, immigration, and plans to reauthorize CHIP and hopefully fund ACA insurance market stabilization. The landscape is busy and the American College of Rheumatology (ACR) advocacy team is hard at work to advance our top issues.

2017 Year in Review

Before I get into our 2018 outlook, here are a few “wins” and accomplishments that the rheumatology community logged in 2017, through the work of dedicated volunteers and staff, like-minded coalition partners, and relationships from our bipartisan PAC:
  • 50% reduction of Medicare penalties for doctors in 2018 — keeps doctors in the system and focused on patient care
  • Cancelled the Medicare Part B Demonstration plan to protect access to medication administration in the doctor’s office
  • Drafted an alternative payment model (APM) for rheumatoid arthritis. ACR’s Dr. Colin Edgerton testified to Congress about it, asking for reduced risks and hurdles to quality for APM track
  • NIH research funding boosted by $2 Billion
  • Senate held 2 hearings to publicize the dealings of pharmacy benefits managers and the need for transparency in the troubling drug rebate system (thanks to ATAP with strong support of ACR, the Coalition of State Rheumatology Organizations, and others)
  • Reversed the Medicare policy to reimburse for in-office biosimilars based on average of drugs in groups, which would have increased financial risks to practices; new policy will reimburse drugs individually
  • Successfully called on the US to restart premium processing for physicians applying for H-1B visas to work in underserved areas & boost our workforce
  • Successfully protected tax-exempt status for graduate student tuition waivers in the GOP tax bill, to protect our pipeline for future medical researchers
  • Rheumatologists and patients sent nearly 4,000 emails to Congress through ACR’s legislative action center and simpletasks.org, published nearly 90 op-eds, letters to the editor and other stories, held over 260 meetings in Congressional offices, and reviewed or monitored nearly 600 pieces of legislation. You and your advocacy team are the best!!
Looking to 2018, many opportunities and challenges pertain to the issues of the high cost of our medicines, growing administrative burdens, maintaining our patients’ access to care and fostering our workforce, education and research funding. We hope to accomplish more relief for us and our patients from high drug costs (see below) including an urgently-needed act of Congress to eliminate Part B drug costs from the MIPS payment adjustments. We’re also looking for new ways to reduce patients’ out of pocket expenses so they can obtain necessary treatments, eliminate the arbitrary cap on physical therapy in Medicare, and other key goals.

The Complexity of Cost in 2018

Drug prices are too high in the United States, period. Congress, President Trump, the media, insurers, businesses, patients, and doctors agree. 2017 saw an uptick in the pressure on pharmaceutical companies, who girded for battle with a lobbying war chest of over a quarter billion dollars in cash. This week, one of the drugs we prescribe (Humira) was in the media’s crosshairs for its high price — and rightfully so. Though rheumatologists represent only about half a percent of US doctors, we participate in this debate because of the relatively large costs incurred by biologics, and also the outcomes from rheumatic disease progression and disability that can occur. I can’t overstate how important it is that rheumatologists, rheumatology health professionals and patients have a voice. We will, and you should, plan to exercise our first amendment rights to exert influence on our government to fix this price problem. Send a prepared email to your elected officials now!
That said, it’s difficult for rheumatologists to single-handedly cut drug prices. The ACR takes strong positions such as allowing Medicare to negotiate prices, publicizing the role pharmacy benefits managers play in increasing drug costs; and shepherding safe, effective biosimilars to compete in the marketplace as quickly as possible; however, current events are focusing our advocacy efforts. Right now, a few very important problems related to costs within Medicare are coming to a head and may turn the rheumatology world upside down quickly. I would like to explain 2 pressing issues fully:
  • Medicare’s new value-baed payment adjustments will now include the cost of drugs given in the office (Part B). Biggest issue of the year. This summer, doctor groups will discover if they will have a Medicare bonus or a penalty of up to 4% in 2019. That bonus or penalty will be multiplied by the sum of the full costs of “items and services” which will now include Part B drug costs, compared to prior years’ adjustments which did not include Part B drug costs. These very high sums could magnify penalties so much as to easily stop physicians from providing Part B drugs to patients in 2019, and instead try to switch patients to Part D (self-administered) drugs, or worse, they could threaten clinics’ financial viability. Meanwhile…
  • Medicare’s quality performance scores will include drug costs for the first time in 2018, and it doesn’t look like the costs of self administered (Part D) drugs are being counted. Cost will count as 10% of a provider/group score — a big jump from 0% in the first year in 2017. And Medicare has not communicated that the agency has an effective way to count costs for self-administered (Part D) drugs, but it will be able to count Part B costs. Thus, doctors who provide drugs in the office will essentially incur a penalty. Sound familiar?
The ACR advocacy team has been working hard on these issues. Since early November, when it became clear that Medicare would not change the policy regarding Part B drugs in its payment adjustments, the ACR has been pressuring Congress to fix the problem. In fact, I’m proud that the ACR has become a national leader on this issue. We’re hearing that a fix has bipartisan support, but it may not be as high a priority as other issues facing Congress today. ACR President David Daikh and American Academy of Ophthalmology President Dr. Cynthia Bradford published a strong op-ed in the influential beltway publication, The Hill, last month. We’re now planning a series of meetings with key Congressional offices — and it’s critical for them hear your voice, too. Tell your elected officials to protect access to Part B therapies. Patients and families can send a prepared letter from here. Doctors from here. Do it now!

Medicare Rehabilitation Therapy Caps

Medicare beneficiaries who need physical, occupational and speech therapy face self-rationing of their own care due to the $2010/year hard cap that was instituted on January 1. Soon, patients will start hitting that cap and will not be able to receive more rehab benefits in 2018 without paying out of pocket. Luckily, with key Congressional committees supporting active legislation that permanently repeals this therapy cap, there’s momentum right now. 30 groups including the ACR are campaigning to #StopTheCap by January 19. Tell lawmakers: Therapy Can’t Wait — Protect access to vital rehabilitation services!


As the Trump administration works reduce and simplify regulation across agencies, the ACR advocated for continuing FDA’s critical scientific vigilance in developing a biosimilars marketplace. Specifically, ACR’s wish list for the FDA regarding biosimilars includes finalizing the robust plan to require 3-switch studies for biosimilars to be designated as interchangeable (and possibly substituted by pharmacists), and creating memorable, distinct names for biosimilars (in the form of memorable suffixes). It is quite unfortunate that despite the approval of biosimilars in the US, prices are being kept high and competition is being held back by dealings between pharmaceutical companies and intermediaries in the drug distribution system like PBMs. ACR, through ATAP, is working to fix that.

CMS Nominee

Alex Azar, the president’s nominee to lead CMS, testified a second time in front of Congress last week. The good news: he appears to agree with our view that intermediaries like PBMs incentivize higher prices, and he supports government working to reduce drug prices. The bad news: he expressed interest in allowing PBMs to work in the Part B drug space, which could increase rheumatologists’ administrative burden and take their attention away from patient care. Additionally, he stated support for Medicare demonstrations to be mandatory if needed — a significant departure from when Dr. Tom Price headed CMS and supported doctors’ ability to opt out of Medicare payment demonstration tests. The Senate will likely vote on Azar’s candidacy soon, and the ACR stands ready to work with him and his team to make sure our profession and our patients are represented at CMS.
One last word: as we all work on our New Year’s resolutions, please remember to go out and EXERCISE your first amendment right to petition your government! (See what I did there?)
GAC Chair
@AngusWorthing  <— lots to remember in this email but don’t worry, you can easily follow along on Twitter
PS Please forward/share this with friends and family. And check out this great video from Sen Murkowski!

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