Specialty Pharmacy

New Legislation Could Close Gap in Medicare Coverage of Home Infusion

Reprinted from the July 2007 issue of SPECIALTY PHARMACY NEWS, a monthly newsletter designed to help health plans, PBMs, providers and employers manage costs more aggressively and deliver biotechs and injectables more effectively.

A recently introduced bill in Congress looks to provide adequate home infusion coverage to Medicare beneficiaries who now are covered for only the drug but not the administration and supplies needed to infuse it.

Introduced on June 5 in the House of Representatives, H.R. 2567, or the Medicare Home Infusion Therapy Coverage Act of 2007, seeks to close this gap in Medicare drug coverage. The primary sponsor is Rep. Eliot Engel (D-NY), and the initial sponsors are Reps. Kay Granger (R-TX), Tammy Baldwin (D-WI), Chip Pickering (R-MS), Randy Kuhl (R-NY) and John Tierney (D-MA). The National Home Infusion Association (NHIA), the Infectious Diseases Society of America and the Biotechnology Industry Organization worked with various congressional members to craft the legislation.

If enacted, the bill would go into effect on Jan. 1, 2008.

Last year saw the introduction of a bill, H.R. 5791, or the Medicare Home Infusion Consolidated Coverage Act of 2006, that also focused on closing the coverage gap for Medicare beneficiaries. While that bill sought to consolidate all aspects of home infusion coverage - the drugs, supplies, equipment and professional services — under Part B, the current bill, though, takes a different approach.

The bill's provisions include the following aspects:

• Infusion-related services, supplies and equipment would be covered under Part B.
• National standards for the provision of infusion therapy would be developed by the HHS Secretary.
• Infusion drugs would be covered under Part D.

The bill, according to Engel, who spoke on June 19 at NHIA's 3rd Annual Legislative Conference, "is just common sense..It's a no-brainer." He added that "private plans have been using home infusion for years to keep down costs."

The coverage under Part B has two aspects: (1) professional services other than nursing services and all necessary supplies and equipment, and (2) nursing services except for those covered under the home health benefit. Separating these was necessary "to avoid duplicate coverage and payment," said attorney Alan Parver, a partner at Powell Goldstein LLP, who also spoke at the conference.

Parver pointed to one facet of the bill found within its definition of "qualified home infusion therapy provider." The third characteristic is any pharmacy, physician or provider licensed by the state who "meets the standards established by the secretary for the safe and effective provision of home infusion therapy on a seven-day-a-week, 24-hour-a-day basis," says Parver. He said that this was "an important element" of the bill, and said that "we've been having an ongoing conversation with CMS over logistical concerns with Part D and getting patients into the system in time to get their treatment. If they don't, patients often stay in nursing homes," which is costly and inconvenient for them, or they could even miss required infusions. According to Parver, "CMS is on board, as evidenced by the fact that it issued a proposed rule for Part D" that says there "must be a qualification of a patient before their next dose or within 24 hours, whichever comes first."

Two Payment Methodologies Would Be Used

The secretary would establish a per-diem payment schedule for the supplies, equipment and professional services (other than nursing). This will be based on the "reasonable costs of providing home infusion therapy in conformance with applicable laws, regulations and standards, and which assures patients' reasonable access to home infusion therapy," said Parver. The idea is to "link the payment to what is required for the therapy," not to simply bridge the gap "between what is paid and what is required," he said. The rates would be updated annually "by the percentage increase of the [Consumer Price Index]-Urban Index for the 12-month period ending in June of the previous year," he said. The secretary will also develop a payment methodology outside of the per diem that reflects the cost of infusion nursing services.

"One of the issues we've had with Part D is there is no national quality standard," said Parver. Information has been "inconsistent or nonexistent as far as home infusion standards."

Because Part D would cover all home infusion drugs if this bill were to pass, it would also "terminate coverage of infusion drugs under the durable medical equipment benefit," the placement of which Parver called "illogical..Infusion was shoehorned into an ill-fitting benefit from the very beginning." Infusion drugs, therefore, would not be impacted by the competitive-bidding program that applies to durable medical equipment, prosthetics, orthotics and supplies. Most infusion drugs are already covered under Part D, he says, so it makes sense to keep them there. This approach also avoids issues with the Average Sales Price, which affects only drugs paid for under Part B.

The bill's supporters hope when the Congressional Budget Office analyzes the measure, "if the CBO looks at certain factors, this bill will not have a cost, but will have savings," said Parver. He cited a RAND Corp. study that showed for every dollar of Part D spending, there will be savings of $1.63 to $2.05 in Parts A and B.

"Quality care that keeps people in their homes can actually save money," contended Jeffrey Kelman, M.D., chief medical officer at CMS's Center for Beneficiary Choices, who also spoke at the conference.

The bill takes an "expansive view of infusion drugs," Parver said. For the first two years of the bill, there is a requirement for open formularies for infusion drugs. After that time, the U.S. Pharmacopeia will develop a model formulary for prescription drug plans and Medicare Advantage prescription drug plans.

Ultimately, said Parver, for the coordination between Part B and Part D to work, "there must be common-sense thinking and approaches." Medical-necessity determinations will be made on the Part B side, and these decisions must be "communicated in real time to the Part D plan," he said. The benefit should be modeled on private-sector coverage and coding for home infusion, he added. "We are trying to capture, as much as we could, how business is done in the private sector."

And what are the prospects for the bill's passage? "I believe this [Congress] is the best opportunity so far for our legislation to have serious consideration," maintained Engel. "There is clear proof that the Part D benefit does not work for home infusion therapy. We obviously need to take a new approach..This fills in gaps in Part B while providing comprehensive coverage under Part D."

View the bill at http://thomas.loc.gov.

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