Aetna Tightens Reimbursement On Anemia Drugs
2 CommentsBy Ed Silverman // October 19th, 2007 // 10:56 am
The big insurer is taking a cue from Medicare and tightening reimbursement on Amgen’s Aranesp and Epogen, as well as Johnson & Johnson’s Procrit meds, according to The Los Angeles Times. The move comes just three months after Medicare greatly lowered the maximum dose for which it would provide reimbursement for the drugs.
The restrictions follow studies that raised concerns the meds may be harmful to some patients and controversy over higher dosages administered by some docs. And other insurers are expected to follow suit. “Aetna is likely to be the first of many insurers to change their guidelines,” Bear, Stearns biotech analyst Mark Schoenebaum tells the paper.
Aetna’s new policy is less restrictive than Medicare’s but severe nonetheless, the Times writes, and the insurer may face a backlash over its decision. Another insurer, Blue Shield of California, attempted to change its policy this summer to restrict dosages of the anemia drugs but partially reversed itself weeks later after complaints from members and some docs.
Aetna has no plans to rescind its decision. “Our criteria are consistent with those of medical societies with regard to the treatment of anemia in patients on chemotherapy or who have chronic renal disease,” says Rachelle Cunningham, an Aetna spokeswoman.
Overall, the anemia drugs accounted for $7 billion in sales for Amgen last year, nearly half its revenue, the paper notes. After Medicare’s decision, Aranesp US sales last quarter dropped 20 percent. On Monday, Johnson & Johnson reported domestic Procrit sales declined an additional 15 percent during its most recent quarter.
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What Do We Do About The Anemia Drug Controversy?
Most doctors and patients would agree the drugs are very helpful for patients when used to correct “severe” anemia, which can be debilitating and even life-threatening. The drugs reduce the need for somewhat risky blood transfusions and can give patients more energy and improve their quality of life.
”These are drugs that were presumed to be entirely safe, given for supportive care and to improve quality of life,” not to actually treat cancer, said Dr. Eric Winer, director of breast oncology center at the Dana-Farber Cancer Institute in Boston. ”So any concern that they could shorten someone’s life are taken quite seriously.”
There is little evidence that the drugs make much difference for patients with “moderate” anemia. Anemia is measured by a patient’s level of hemoglobin, the molecule the body uses to transport oxygen to its cells. Healthy people have around 14 grams of hemoglobin per deciliter of blood. Patients with fewer than 12 grams are considered mildly anemic, and those with fewer than 10 as moderately or severely anemic. The labels on the drugs approved by the FDA encourage doctors to aim for a hemoglobin level of 10 to 12.
Critics of the drugs say their increased use has been driven by profit. According to Dr. John Glaspy, director of UCLA’s Outpatient Oncology Clinic, one complicating factor is that oncologists make significant revenue buying cancer drugs from manufacturers and charging patients a higher price for receiving the drugs in their offices. That profit motive could influence some doctors’ decisions.
Len Lichtenfeld, deputy chief medical officer for the American Cancer Society, told UPI last year that “probably more than a billion dollars is spent on erythropoietin each year, which makes it one of the most expensive cancer drugs.” A six-month course of treatment can cost more than $10,000 per patient.
After this issue had started to be reported, U.S. Oncology took an 8-10 million dollar hit in its first-quarter SEC report last year, including reduced pre-tax income due to lower use of anemia drugs. They also were handicapped by CMS stopping the Medicare Demonstration Project which paid chemotherapy providers $130 per report, per infusional-chemotherapy recipient, on a patient’s level of nausea, vomiting, pain and fatigue, something that Congress found out that they were supplying free of charge anyway.
A continuance of the Medicare Demonstration Project would have exacerbated existing economic and clinical problems instead of resolving them by increasing the temptations for physicians to overuse injectable drugs and promise to aggravate the economic problems Congress attempted to fix with the new Medicare law.
A New York Times article reported last year that Federal laws bar drug companies from paying doctors to prescribe medicines that are given in pill form and purchased by patients from pharmacies. However, companies can rebate part of the price that doctors pay for drugs, like the anemia medicines, which they dispense in their offices as part of treatment. Doctors receive the rebates after they buy the drugs from the companies, but they also receive reimbursement from Medicare or private insurers for the drugs, often at a markup over the doctors’ purchase price.
Although the new Medicare bill tried to curtail this kind of drug concession, private insurers still go along with it. What needs to be done is to remove the profit incentive from the choice of drug treatments. Let’s take physicians out of the retail pharmacy business and force them be doctors again!