ESSENTIAL HEALTH BENEFITS: CANCER DRUGS/BIOLOGICS NOT “PROTECTED”

The introduction of draft regulations implementing the Affordable Care Act has begun. On November 20, 2012, HHS released its Proposed Rule, “Standards Related to Essential Health Benefits, Actuarial Value and Accreditation”.

The Proposed Rule bears watching and comment for a number of reasons. First and foremost, the Rule does not provide the “Protected Classes” designation that the Medicare Part D Drug Benefit allocated to 6 “therapeutic” classes; one of which was antineoplastics. In the establishment of the Part D benefit, essentially all FDA-approved antineoplastic agents were deemed as “protected” and thus covered. Such protection was deemed important to assure that serious conditions like cancers have available appropriate options to assure patient access to needed therapeutics. Under the newly proposed rule for the Essential Health Benefits (EHB) Packages for Qualified Health Plans, including Plans that will participate in the Health Exchanges, the inclusive nature of the “Protected Class” has been omitted. This disconcerting circumstance was indeed presaged by a lonely footnote at the bottom of the last half page of the HHS December, 2011 EHB informational bulletin that closed with: “we do not intend to adopt the protected class of drug policy in Part D.”

The benchmark for drug/biologic inclusion then becomes the greater of one drug in each category or class or the same number of drugs in each category and class of the EHB Benchmark plan. The focus on benchmark plan designs is on the largest small employer plan in the state. As the size of the plan decreases, the sophistication of benefit design and understanding of cancer therapeutics can be expected to decrease as well. The Proposed Rule then holds out the Guidelines of the United States Pharmacopeia (USP) as an organizational tool to help plans determine classes and categories of drugs that must be considered. One issue with the USP’s fine work is that updating may not occur for more than two years or so. It is noteworthy that in 2012, the FDA has approved over a dozen new drugs and biologics as cancer therapeutics.

The bottom line on all this is that as the science of cancer advances our understanding of the multiple genetic causes for cancers through RNA mediated expression of proteins our ability to develop targeted therapies is enhanced. However, the policy-based benefit rules (e.g., EHBs) offered threaten to diminish the availability of and access to the innovative mechanisms of action needed to make treatment more effective, less toxic and more efficient.

by Bill McGivney, PhD
National Health Policy Expert
McGivney Global Advisors

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