Myrl Weinberg, FASAE, CAE

Only 1% of all marketed drugs have a companion diagnostic to determine which patients will benefit from a specific treatment, and this lack of clinically useful diagnostics is hindering growth in personalized medicine.

Once a new diagnostic test is approved by the FDA, it can take anywhere from 18 months to several years before the diagnostic has an assigned code for prescribing and billing. This means precious treatment time is lost for the patient.

Take the example of the human epidermal growth factor receptor 2 (HER 2) diagnostic test to identify breast cancer patients for Herceptin drug therapy (

). The test received FDA approval in 1999, but the code for HER 2 was not established until 5 years later. That meant women with breast cancer had to gamble on whether to undergo Herceptin therapy, not knowing if it was the right treatment option for them, because there was no assigned code for ordering or paying for the HER 2 test.

On April 1, 2014, President Obama signed into law HR 4302: the Protecting Access to Medicare Act of 2014, a momentous step toward promoting the development and use of advanced diagnostics.

The bill received extensive media coverage because it was the latest effort to temporarily delay both a planned cut to physician reimbursements under Medicare and the implementation of the next-generation medical coding system known as the

 International Classification of Diseases, Tenth Revision

Also tucked inside this legislation were 2 game-changing provisions for which the patient advocacy community has been fighting since 2011:

		A means for getting advanced diagnostic tests to patients more quickly, and

		A process to promote high-value advanced diagnostics that truly personalize care for patients.

These provisions were first proposed in Section 102 of the Modernizing our Drug and Diagnostic Evaluation and Regulatory Networks (MODDERN) Cures Act, a bill crafted by the National Health Council.

Improving Patient Access to Advanced Diagnostics

It is rare for a drug to be safe or effective for everyone and under all circumstances.

 This inherent variability in response to a particular treatment has a significant effect on the quality and cost of healthcare.

 To ensure the best care, we need diagnostics to target the treatment that meets the specific needs of the patient. After such tests have been approved by the FDA, there needs to be a way to quickly get them into the market and to the patients who need them. Section 216 of HR 4302 creates a temporary Healthcare Common Procedure Coding System (HCPCS) code that can be assigned after tests are cleared or approved by the FDA. Also under the new law, existing approved tests that have not yet been assigned a Medicare reimbursement code must have a temporary HCPCS code assigned by January 2016. This temporary code will be used until a permanent code has been assigned, but not for longer than 2 years, ensuring that patients receive immediate access to these diagnostic tests and increasing the likelihood of establishing more effective treatment plans.

Promoting the Development of Advanced Diagnostics

In addition to enhancing access to approved diagnostics, the new law changes how the reimbursement rate is set for such tests in order to promote the development of high-value advanced diagnostics that truly personalize the delivery of care for patients.

When a new advanced diagnostic gets approved under the current system, CMS assigns the test a Medicare reimbursement rate that is comparable to that of the most similar test currently on the market. However, since the new diagnostics are innovative, there is no apples-to-apples comparison by which to determine a payment level.

Section 216 of HR 4302 creates an expert advisory panel that will use a more comprehensive approach to recommend the Medicare reimbursement rate for new diagnostics. This panel will take into consideration factors such as the improvement in patient care and the differential between the cost of developing and administering the new test compared with an existing test that is being used as the payment benchmark. Placing greater emphasis on the value of advanced diagnostics will encourage the development of such tests, which will improve the ability of healthcare providers to appropriately treat individual patients.

The Secretary of HHS is directed to create the advisory panel no later than July 1, 2015, and the law states that the panel should be “composed of an appropriate selection of individuals with expertise, which may include molecular pathologists, researchers, and individuals with expertise in laboratory science or health economics.” As originally conceived, this panel would also include patient representatives, including a patient representative for rare disorders; clinicians; experts in the area of pharmacoeconomics or health technology assessment; and individuals with expertise regarding the impact of new tests on quality of patient care, including genetic counselors.

Since the precise makeup of the expert advisory panel is not articulated in the law, the patient advocacy community will seek to ensure that the patient voice is part of the decision-making process.

For many people with chronic conditions, their health care history is a drawn-out trial-and-error process to find the treatment plan that meets their unique needs. There must be a better way to determine which therapy will be the most effective for an individual. The changes in the nation’s Medicare diagnostic system as enacted by Congress and signed into law by the president are 2 major steps toward meeting this goal.

Articles

Congress has passed a law designed to get advanced diagnostic tests to patients more quickly and to promote personalized care for patients.

New Law Promotes Development of and Access to New Diagnostic Tests

Back in June 2012, I wrote that a healthcare revolution was already under way in this country, and that there was no turning back.

 The Affordable Care Act (ACA) is the law of the land and millions of people are reaping the benefits—no discrimination for preexisting conditions or gender, improved coverage for children and the poor, and changes in Medicare to better serve the elderly caught in the “donut hole,” to name only a few of the monumental advancements to healthcare delivery. As more and more people become aware of the ACA and see the law in action, we face a new opportunity this summer. This is an opportunity to make the law better and strengthen the health insurance marketplace.

The final rule on essential health benefits, actuarial value of qualified health plans (QHPs), and accreditation of issuers laid out the standards that are now in effect for calendar year 2014 and 2015.

 This year, the Obama administration is expected to evaluate the current structure of the insurance marketplace and begin working on standards for 2016, which will be released in early 2015. This document will provide new guidance to QHPs to ensure continued access to affordable health coverage. This year is the advantageous moment to build on the successes already achieved under the ACA and to enhance marketplace operations in a way to make them more patient focused. In particular, the patient advocacy community believes there are needed improvements in 5 core areas: nondiscrimination, transparency, uniformity, continuity of care, and enforcement (

The ACA took a groundbreaking step in healthcare delivery by outlawing QHPs from discriminating against people with preexisting conditions. But the guidelines need to be more specific to prevent any unintended restrictions on care for people with complex chronic conditions.

For example, out-of-pocket costs must not create a barrier to access. Even though there is an out-of-pocket maximum on individual healthcare costs, people with complex—and expensive&mdash;healthcare needs could conceivably face their $6350 limit in the fi rst month of coverage.

Benefit designs should not create discrimination caused by unfair plan design elements, including utilization management techniques, the structure of the formulary, and cost-sharing requirements. QHPs should also provide meaningful access to healthcare providers across various specialties.

Purchasing health insurance can be a daunting task for people, and particularly for individuals who have never had to buy insurance before the ACA and its mandate for coverage were enacted. The only way patients will be able to make intelligent purchasing decisions is if they have access to complete details about the coverage and cost of QHPs offered in their state.

Information about plans should be designed in a way that leads to an understanding of the enrollee’s options. The information should be accessible in a variety of ways so it may serve a diverse patient population, such as via print, Web, and mobile devices. Patients should have easy access to comprehensive details about each plan prior to enrollment. Easy-to-understand, easy-to-locate formularies and provider network lists should be required of all plans.

Hand-in-hand with meeting transparency requirements, QHPs also need to provide their information in a uniform manner to make it easier for patients to compare plans side-by-side. The federal government should develop and require QHPs to use a standard template for formularies and provider networks. There also needs to be a uniform process that is clear and easy to navigate for people who need to file grievances with their plans or appeal adverse plan coverage determinations. These determinations should be easy for patients to understand and include a uniform definition of what services are deemed a “medical necessity.”

As people with chronic conditions become savvier about purchasing health insurance, they will naturally consider changing their plans during an approved enrollment period in order to better meet their budget and health needs. They should have the freedom to transition to new plans, and to do so without encountering repeated barriers.

QHPs should be required to fill prescriptions for patients who are transitioning into the new plan and also stabilized on specific medications. Plans should honor any prior authorization, step therapy, or exceptions process already attained by an enrollee. Plans should also allow the transitioning patient to continue treatment for a set period of time under the care of a prior physician or specialist and receive care as if the provider is “in network.”

With 16 states (and the District of Columbia) running their own insurance marketplaces, 15 others with various forms of federal-state arrangements, and 19 federally facilitated marketplaces, there are bound to be differences.

 For the approximately 36 million people who relocate each year, these differences could be a rude awakening when they shop for a health plan in their new community.

Patients should be confident that any QHP sold through the marketplace meets federally established nondiscrimination standards and that the threshold is uniform across the United States. There should be a federal monitoring program to ensure that appropriate quality checks are in place to guarantee that QHPs are meeting federal requirements and that states are held accountable for plans not in compliance.

The patient advocacy community has created a list of basic principles that it believes should guide the federal government as it considers modifi cations to the insurance marketplace. In the coming months, all stakeholders in the health community—including insurance companies; provider organizations; and pharmaceutical, biotechnology, and medical device companies&mdash;will be invited to work with the National Health Council and its patient advocacy organization members to sketch out potential solutions. We believe that as long as the patient&mdash;especially the patient with complex chronic conditions&mdash;is at the focal point of the discussion, then the solutions will ensure a more robust and effective healthcare marketplace for all.

As the administration looks at improving the insurance marketplace, patient advocates are developing a wish list of modifications to ensure that it is more patient focused.

Making the Marketplace More Patient Focused

On October 1, 2013, the newly created health insurance marketplace opened for business. It was a rocky beginning, with frustrations incurred by patients, providers, payers, and policy makers. However, by December 30, more than 2.1 million people had enrolled in private health insurance plans through the new federal and state websites.

 The Affordable Care Act (ACA) provides a lifeline to heathcare coverage that was outside the grasp of some individuals.

The implementation of this groundbreaking legislation is an important advancement to our country’s healthcare system. Yet people are being required to make purchasing decisions without adequate information to help them pick the right insurance plan.

The ACA states that, at a minimum, a marketplace must “establish and make available by electronic means a calculator to determine the actual cost of coverage” of qualifi ed health plans (QHPs).

Healthcare.gov, the federal government’s website, can help a person understand the premium and deductibles for insurance plans offered in the various states.

 The Henry J. Kaiser Family Foundation created a subsidy calculator where people can get an estimate of their eligibility for health insurance subsidies, plus detailed information about how the estimate is calculated.

The website created by the nonprofit organization Get Covered America helps people estimate their insurance costs based on premiums for the least expensive QHPs plus federal subsidies based on a person’s income.

It is important for a person to know about premiums, deductibles, and subsidies before enrolling, but these data points do not present the whole cost picture.

For patients to adequately compare costs across available QHPs, they need access to a tool that assists in the calculation of expected out-of-pocket costs for an entire plan year and for their individual healthcare needs. Out-of-pocket costs include copays, coinsurance, and other costs to a patient in addition to their premium. For consumers with minimal healthcare needs, comparing plans is fairly straightforward. In contrast, people with chronic diseases and disabilities and their family caregivers face greater difficulty analyzing expected out-of-pocket costs without a calculator. It is critical that these patients have the tools to select the right plan to meet their complex health needs.

As this publication was going to press, the National Health Council (NHC) was putting final touches on a new website to help people with chronic diseases and disabilities better understand the new health insurance marketplace and provide a guide to what they need to consider when selecting a health insurance plan that meets their personal health and budget requirements.

A central function of the the Putting Patients First website will be a cost calculator. People will be able to insert their age and state of residence, plus their expected annual use of healthcare: visits for primary care, specialty care, mental healthcare, and emergency department care; potential hospitalizations and outpatient surgeries; and their use of prescriptions, both brand name and generic.

The resulting cost report will show estimated out-ofpocket medical and prescription costs and the premiums across different metal levels of the QHPs in the person’s state. While the Putting Patients First website will not direct people to specific health plans, the estimate of their total annual health costs will help guide patients to the right metal level to meet their needs.

People will also be able to read short sketches about patients with different medical and drug utilization patterns to see how plan selection impacts personal healthcare spending. Also included on the website is a library of resources to assist with enrolling in health plans, such as primers and checklists, which have been created by the NHC and its member patient organizations.

The Putting Patients First website encourages people to share their experiences enrolling in a QHP purchased through the new marketplace. The NHC will be using these stories as well as data collected from a statistically relevant survey to help policy makers understand what is working and what needs to be changed to improve the marketplace. These stories will infl uence the recommendations the NHC will be sending to the administration in 2014 to enhance the patient marketplace experience.

The Centers for Medicare & Medicaid Services (CMS) created a cost calculator tool for Medicare benefi ciaries shopping for Medicare Advantage plans.

 This Plan Finder allows people to evaluate out-of-pocket estimates for the average amount a benefi ciary might expect to spend each year for health and drug coverage. Conceptually and mechanically, a similar tool for the health insurance marketplaces would be an invaluable resource, particularly for the purchasers of QHPs who may not be as comfortable navigating the complex world of health insurance.

Since the federal government has decided at this time not to create such a calculator for QHPs, the patient advocacy community is stepping up to fill the information gap. The Putting Patients First cost calculator is not perfect. The website is not as robust as what the federal government could create. Therefore, the patient advocacy community will continue to actively urge CMS to make creating a cost calculator that presents actual health insurance plan costs a top priority for 2014.

People with chronic conditions need effective and affordable drugs to live longer and better lives. Unfortunately, regulations covering plans in state exchanges may impede access.

Understanding the Actual Cost of Health Insurance

The American Journal of Pharmacy Benefits

 certainly understand the importance of patients having access to effective and affordable drugs in order to live longer and better lives. Unfortunately, the regulations that will guide health plans available in the state exchanges may actually impede access to essential medicines.

In February 2013, the Centers for Medicare & Medicaid Services (CMS) issued its fi nal rule defining essential health benefi ts (EHBs).

 The rule requires health plans to cover at least the number of medicines in each United States Pharmacopeia (USP) category and class as the  state’s selected benchmark. The CMS counting methodology was designed to be an initial test for adequate coverage of prescription drugs. It was not intended to be the only mechanism to ensure appropriate access or  nondiscrimination. Reliance on this overly simplistic counting approach will allow plans to limit patient access to medications and yet still be deemed adequate.

The counting methodology has several inherent flaws that impede its usefulness as an indicator of formulary adequacy. For example, this approach does not account for combination therapies, leaving plans with less incentive to cover these products. For people with  human immunodeficiency virus (HIV), this oversight could have devastating impact. The National Institutes of Health recommends that all people infected with HIV undergo antiretroviral therapy involving a combination of medications.

The rule is silent on the coverage requirements for drugs provided under a plan’s medical benefit, such as intravenous (IV) or injectible drugs, with no standards to ensure adequate coverage of these medical-benefi t drugs. The CMS requirements also do not account for products with time-release technology, which are the standard of care for various mental health conditions. In addition, there are no specific guidelines on how to treat new drugs that enter the market in the middle of the benefit year. Patients want assurances that new drugs are considered in an appropriate and timely manner to ensure access to better treatments.

The patient advocacy community believes 2 specific action steps need to be taken by the federal and state entities responsible for approving qualified health plans (QHPs) that will be offered through the exchanges. Regulators must:

		 Set additional QHP coverage requirements for drug types that are not adequately protected by the CMS counting methodology, such as combination products, physician-administered and medical-benefi t drugs, and time-release products;

		Require health plans to establish a process to review new drugs that come to market during a benefit year,  including a set time frame and transparent method for making coverage decisions.

Factors such as tiering, cost sharing, and utilization management have an enormous influence on whether patients can actually get the medications they need. Currently, there are no standards for how plans should place drugs from a single class of medications across tiers and no requirements that a covered class have even a single “preferred” drug. Additionally, the cost sharing assigned to each tier is not limited, so plans may have cost sharing at or above 50% coinsurance for higher tiers.

There also are no restrictions on the use of utilization management strategies, such as prior authorization, step therapy, and quantity limits. For someone with epilepsy, it may take trial and error using several of the more than 20 antiepileptic drugs in succession to come up with the right treatment plan.

 Even when plans meet the standard established by the counting methodology, a plan’s tiering, cost sharing, and utilization management rules are likely to result in insured patients who cannot access their necessary prescribed medications. More intensive reviews of these elements of benefi t design could ensure that plan enrollees have appropriate access to those medications that are covered by their QHP’s formulary.

Federal and state entities responsible for approving QHPs must:

		Review the combination of coverage, cost sharing, and utilization management when reviewing plan formularies;

		Require coverage of at least 1 preferred brand per class on a preferred tier; and

		Establish maximum cost-sharing levels for higher formulary tiers.

Our country needs stronger benefi t requirements and better review of the formularies for QHPs to ensure that they provide appropriate and cost-effective patient access to medications.

State and federal overseers should look beyond a simplistic counting methodology for drugs and review formularies in their totality, taking into consideration a  combination of factors, including coverage, cost sharing, and utilization management. Concrete actions, such as those listed above, will results in formularies that meet the needs of all enrollees, especially those of people livingwith chronic diseases and disabilities.