Medicare Rule Expands Coverage Of Off-Label Cancer Treatments

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Cancer / Oncology
Article Date: 28 Jan 2009 - 4:00 PDT

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A November 2008 change in Medicare policy to expand coverage of drugs for off-label uses to treat cancer patients "has sparked questions about rising health care costs and the influence of drugmakers," the Wall Street Journal reports. The new rule expanded from one to four the number of guides -- also known as compendiums -- on which Medicare relies to authorize a drug for use on a certain form of cancer (Armstrong, Wall Street Journal, 1/27).

According to the New York Times, the authors of the compendiums, who are not affiliated with the federal government, evaluate medical literature to make their recommendations. The new rules changed the compendiums' authority. Under the previous rules, Medicare representatives were supposed to consult reference guides or compendiums and use their own discretion to interpret recommendations in determining which treatments were covered. However, the decision now is based only on the compendiums, "even when there is little clinical evidence behind a particular recommendation," according to the Times. The Times reports that if one of the compendiums recommends a cancer treatment, Medicare is "essentially obliged to pay for it -- unless one of the other guides specifically advises against it," according to the Times (Abelson/Pollack, New York Times, 1/27). According to the Journal, the new guides consider more drugs effective for more cancers than the previous guide did (Wall Street Journal, 1/27). Medicare officials will review the choice of compendiums annually, according to the Times.

Proponents Laud Changes
Drugmakers and some oncologists have applauded the changes. A spokesperson for the Pharmaceutical Research and Manufacturers of America said the rule changes ensure "that cancer patients have access to the treatments they need." The Times reports that many oncologists say they required "greater flexibility" in choosing cancer drugs because the FDA approval process for new cancer treatments is lengthy. In addition, the Times reports that expanded access to off-label treatments may be necessary because, with some rare types of cancer, there are too few patients to make it worthwhile for drugmakers to undergo the formal FDA approval process. For example, FDA has approved only two drugs for brain cancer, but oncologists say they need the ability to try other combinations of treatments.

Issues Arise
Several issues have arisen with the new rules. The Times reports that there are possible conflicts of interest because "some of these new compendiums have close financial ties to the drug industry." In addition, while the American Society of Clinical Oncology has said its doctors will ensure that the appropriate off-label uses are covered, some cancer specialists have said that the ability to offer more off-label drugs could let physicians avoid difficult discussions with patients regarding poor prognoses. "It makes it easier to give drug after drug and keep the fantasy alive," Andrew Berchuck, director of gynecologic oncology at Duke University, said. Critics also say the changes make it easier to get questionable treatments covered by Medicare. Medicare is giving "carte blanche in treatment for cancers," Steven Findlay, a health policy analyst for Consumers Union, said, adding that the expanded coverage could encourage doctors to use patients as test subjects for unproven treatments. Furthermore, while oncologists "had clamored for the changes," claiming that some of the off-label treatments are essential, "there is scant clinical evidence" of the efficacy of some of the drugs, which can cost as much as $10,000 monthly, the Times reports. Opponents say the rule changes are wasteful and may needlessly expose patients to side effects of drugs that may not be helpful.

Spending Increase?
According to the Times, "it is hard to predict how much" Medicare spending on cancer drugs could increase as a result of the new rules because Medicare officials canceled a cost analysis of the changes. However, the changes "seem almost certain to raise the federal drug bill," which could make it "more difficult for the new administration to rein in spending on unproven medical treatments," according to the Times. In 2007, Medicare paid $2.4 billion for cancer drugs (New York Times, 1/27). Private insurers, who "typically follow Medicare's coverage guidance," spend nearly $45 billion annually on cancer drugs, the Journal reports (Wall Street Journal, 1/27).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation.

© 2009 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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