Medicare changes are important for cancer drug manufacturers as approximately 60% of newly diagnosed patients will be covered by the program. Medicare has traditionally covered nearly all cancer treatments for US Food and Drug Administration indications and for indications with a National Comprehensive Cancer Network level 1 or 2 rating; however, while ultimate coverage may remain comprehensive, changes in types of coverage will inevitably complicate oncologists’ treatment decision-making and patients’ access.
The continued growth of Medicare Advantage (MA) represents an immediate and frequently impactful change to cancer care. The program’s share of Medicare lives has risen substantially in recent years; even states with high penetration experienced growth of 5% or more between 2022 and 2023 (Figure 1).
Source: Centers for Medicare & Medicaid Services. Monthly Enrollment by State 2023 03. Accessed April 25, 2023. https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/mcradvpartdenroldata/monthly/monthly-enrollment-state-2023-03
*North and South Dakota, Wyoming, and Alaska were excluded due to very low penetration.
Multiple factors suggest that many health insurers will continue to seek growth in the MA market:
MA disrupts “business as usual” for all stakeholders in three ways:
Source: Cornell Law School Legal Information Institute. 42 CFR § 422.116 - Network adequacy. Published April 12, 2023. Accessed April 25, 2023. https://www.law.cornell.edu/cfr/text/42/422.116
Implications for Manufacturers
Manufacturers’ payer relations are increasingly important as commercial insurers extend their reach to growing numbers of seniors where cancer is most prevalent. Although coverage is still subject to Medicare policy, insurers’ implementation includes PA, step therapy, and differential out-of-pocket costs. Optimizing access will require active engagement and, in many cases, contracting.
MA networks may exclude leading cancer providers in many markets. Manufacturers can expect referrals and patient volume to decline in practices excluded from major payers’ networks. Channeling will increase patient volumes, and value to manufacturers, of those oncology groups willing to accept insurers’ terms. These terms may include compliance with relatively strict medical management processes featuring pathways, guidelines, and step therapies.
Changes to Medicare, including Medicare Advantage, have important repercussions on patient access to care, oncologists’ treatment decisions, and drug manufacturers’ processes.Lee Blansett
Welcome to the April 2023 edition of our Monthly Insight Series. This month we are evaluating the desire among oncology pharmacists to return to in-person meetings.Cindy Chen
Welcome to the March 2023 edition of our Monthly Insight Series. This month we discuss how Humana terminated its employer group line of business and the implications.Chris Van Denburg