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Remarks Before the House Prescription Drug Task Force on Part B Demo

By Justin Lowenthal, MD/PhD student

Thank you. I want to thank Representatives Doggett and Welch for their leadership on this issue and for the invitation. I also want to thank my colleague Bruce Rector from DFA, my co-chair and the energy behind much of the work we do.

To introduce myself, I currently serve as the Co-Chair for Doctors for America’s Drug Price, Value, and Affordability Working Group, and serve as the State Director for DFA in Maryland. I am currently a medical student in the joint MD/PhD program at the Johns Hopkins University School of Medicine, and was previously trained as a bioethics fellow in the Department of Bioethics at the National Institutes of Health.  

I am here today representing Doctors for America, a nonpartisan nonprofit organization, with the combined voices of more than 18,000 physicians and medical trainees as well as others involved in providing health care to millions of Americans. Our members span the spectrum from rural primary care and family medicine physicians to those in tertiary care oncology and surgical subspecialty practices. We are all united in our mission to fight on behalf of the patients we serve, advocating for policy positions based on what we see and what we hear on the ground from our patients each and every day. This is why DFA was formed: to be a group of health care providers who advocate for their patients first.

It is because of our motivation to improve the quality, affordability, efficiency, and compassion of the health care systems our patients experience that we support the Part B Demonstration. This past spring, DFA leadership voted overwhelmingly to support the Demonstration because we have seen too often how meaningful and well-intentioned efforts at reforming our completely irrational drug pricing systems get derailed by theoretical concerns.

Meanwhile, there are hundreds of thousands of patients – by some estimates, up to 24% of Medicare beneficiaries – who at this very moment are having difficulty accessing the medications they need because of high and ever-rising drug prices. The current Part B reimbursement formula has unintended incentives that forces some physicians to sustain their practices through reimbursement for these higher-price medications rather than through fees that better reflect the care they give to patients. And the pharmaceutical industry retains the ability to utilize the perverse incentives that are currently embedded in the Part B reimbursement scheme to their advantage, using the high price of a drug as a tactic to encourage physicians to use their products.

Increasing prices for medications cause a spiral of unintended consequences where higher-priced medications are prescribed frequently - even when a comparable, cheaper alternative is available - leading to barriers being placed to reduce their use. With no restraints in place, drug companies raise prices further in order to increase profits. Such a system is unsustainable for the country. It is also actively harming real people – people like Heather Block - in that it often prevents those suffering from devastating cancers and disabling autoimmune conditions from accessing the very care that these systems are set up to support. 

You may have heard of Heather Block’s story; if not, she is a patient with metastatic stage 4 breast cancer who is fast going through her savings trying to pay for her medications, which are billed through Part B and require her to pay 20% with no out-of-pocket-maximum. She has written and spoken out in support of this demonstration. And there are many more in the same situation.

We recognize the concerns raised by our colleagues in oncology, rheumatology, and elsewhere that these reforms risk adversely impacting their practices. Our membership includes many providers in these specialties and our goal is to enable our patients to access and be able to afford the care that they need and for physicians to maintain adequate financing for their practices. However, we feel strongly that the prudent path forward is to collaborate with CMS to strengthen the Demonstration before and during its implementation, NOT to prevent it from happening. In this vein, we are part of the previously-mentioned coalition who has proposed several modifications to the demonstration, and support the ideas of Dr. Bach and others regarding increasing the flat fee, for example. 

It is possible to simultaneously focus on the needs of all our patients, while also making sure specialty patients maintain access and that physicians are protected. To say otherwise is a false choice. We have past experience with formula changes where there were dire warnings of patients not having access and physicians going bankrupt – both when the system transitioned to ASP as the reimbursement standard, and during the sequester. These warnings did not pan out, yet these threats continue to be raised, most often by those with a stake in the status quo. More than anything, our physicians want to be adequately paid for doing what they do best – doctoring – and do not want to worry about balancing their practice finances based on reimbursements from drugs. 

We are confident that CMS can monitor the Demonstration to ensure that physician practices are not being unduly harmed by these reimbursement adjustments. We need to make sure specialty drugs are priced at reasonable levels, and that patients do not face unthinkable trade-offs between medications and other essentials. By changing reimbursement incentives, focusing on concepts of value, testing models such as reference-based pricing, and providing clinical decision-support tools – all of which, as you’ve heard, this Demonstration proposes to do – we can allow physicians to focus on providing the best care possible for their patients and limit the ability of drug companies to raise prices. 

This demonstration could have real positive impact on patients like Heather Block, patients like those on expensive infusions for autoimmune diseases like Multiple Sclerosis, patients like the approximately 1 in 5 Medicare patients without supplemental coverage facing co-pays that are as much as 20% of the total Medicare payment amount for the drug, patients whose stories have been shared with us by dozens of our members (stories which I am happy to share with you). It is THESE patients that illustrate why the ideas embedded in the Part B demonstration must be implemented. 

We know that several other physician groups have come out against this proposal, and those in oncology are particularly concerned. Thus, I want to share the perspective of a prominent practicing oncologist-hematologist, Dr. Vincent Rajkumar of the Mayo Clinic, who in August 2015 brought together a large coalition of oncologists in calling for efforts to lower the prices of cancer drugs. He shared with DFA his opinion on the CMS Part B Demonstration, writing: “I express my strong support for the proposed Medicare Part B changes. The current system rewards physicians for dispensing the more expensive drug when two equally good options are available. The push back against the proposals are coming from those who stand to lose revenue. This is to be expected.  Thus, it is best to get feedback from those who don't have conflicts of interest. It is sad that what is good for patients does not have the support it deserves."

We believe the CMS Part B Demonstration Project represents an important step, and it is because of the thousands of patients that we see each day that we strongly support moving forward. We urge all of you to do the same. Please – please – be the ones who take a stand in support of the patients that are suffering now, the patients that we see each day. Give them the support they deserve. Thank you.

Justin Lowenthal an MD/PhD student at Johns Hopkins, a biomedical engineer, and a bioethicist with expertise in ethical issues at the intersection of emerging therapeutic technologies and health care systems. 

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