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Combination Immunotherapy Pricing and Reimbursement

Jul 27, 2017

At approximately $150,000 per year for monotherapy checkpoint inhibitors, and $256,000 a year for the newly-approved combination of ipilimumab and nivolumab for patients with advanced or inoperable melanoma,1 it’s no secret that immuno-oncology (I-O) treatment is expensive.2 These costs are likely to grow with several studies underway involving checkpoint inhibitors in combination with other immunotherapeutic agents, as well as with chemotherapy, radiation therapy, targeted therapy; CTLA-4 and PD-1 combinations; and combinations with standard anticancer agents and antiangiogenic agents.3

As other combinations are approved, they will pose additional reimbursement challenges for community cancer programs and practices. ICLIO talked with Niesha Griffith, MS, RPh, FASHP, Vice President of Cancer Services at West Virginia University to learn what some of these challenges might be, and how academic and community cancer programs prepare to address them.

What do you see at the moment as the main factors that are affecting the cost sustainability of combination immunotherapy?

Niesha Griffith: Both cost and reimbursement. These agents alone are amongst the most expensive medications we use today; using them in combination with another expensive agent is certainly going to capture the attention of payers. Then we can expect even more challenges with reimbursement.

Today, a prior authorization is merely a suggestion of payment. Because of this, providers are having to invest more resources on the front-end to make sure that they get paid for drugs.  In the past, you could simply call the payer and provide the names of the drugs and the anticipated dates of administration. Things have certainly changed.  Ensuring appropriate reimbursement is resource intensive and requires a lot more clinical information on the front-end (with the prior authorization) and on the back-end (with the denials).

It’s also important for providers to enroll patients in the manufacturer patient assistance programs so that they can seek reimbursement support should it be needed. The anticipated cost increases associated with combination therapies will certainly lead to more payer scrutiny and more requirements for payment, placing more of a burden on providers.

Some of the things that you’ve touched on are already challenging for monotherapy checkpoint inhibitors. Do you think there is a point where the kind of scrutiny that we’re seeing at the payer end is going to become untenable for cancer centers?

Griffith: I do fear that and I’ve heard others voice similar concerns. Some practices already do not want to stock I-O drugs because of their high cost and the resource intense processes necessary to ensure their appropriate reimbursement. The lag time between purchasing the drug and getting reimbursed from the payer presents challenges for smaller practices.

Is it going to become unmanageable?  Yes, likely for some smaller practices it will, and they will move away from the buy-and-bill model and opt for receipt of patient-specific medications from an outside pharmacy. In the hospital-based setting, if a medication is ordered for one of its Food and Drug Administration (FDA) approved indications and therefore expected to be reimbursed, it will most likely continue to be provided.

Larger health systems will control costs by limiting “site of care” for certain medications. In other words, for an expensive medication regimen that is best prescribed by a disease-specific specialist, a hospital system may limit its use to one site only where the disease-specific specialists practice. These drugs will also most certainly be restricted to outpatient use as well, because of the financial losses that would be incurred if they were provided during an inpatient visit.

To optimize the likelihood of reimbursement, I recommend that providers always enroll patients in the manufacturer assistance programs for any medications costing more than $50,000 per patient per year (all I-O agents). For combination therapy, it would entail completing the forms for both medications. Most manufacturers require the paperwork to be done on the front-end to be eligible for any type of reimbursement support. All of the paperwork must be completed, signed, and submitted prior to the medication being given. 

So aside from enrollment in patient assistance programs and getting prior authorizations, are there other things that hospitals or community cancer programs or pharmacy services ought to be doing that are particular to combination therapies?

Griffith: It’s important to have clinical staff on the front-end, performing the prior authorizations. Clerical staff obtaining a prior authorization is no longer a sustainable model. The same goes for responding to denials, it’s important to have clinically trained staff doing this work.  I consider a best practice model to be one where an oncology trained individual (nurse, pharmacist, etc.) reviews and responds to denials. The amount of clinical information that’s being required for reimbursement on the front- and back-end is significantly different than what it used to be.  

Some organizations are investing more in peer review and providing physicians with guides on how to conduct a peer-to-peer interview. Hospitals overall are beginning to invest more on the financial infrastructures, including human capital, to support the reimbursement of oncology medications. New requirements have overwhelmed traditional models that had been effective for years.

Before we even get to prior authorization, clinicians have to make decisions about patient selection, and it’s complex to define the patient population for I-O drugs. Where do you see the payers sitting on the question of determining patient selection?

Griffith: It shouldn’t be a problem to use medications prescribed for their FDA approved indications, as payment can be expected. However, we are likely to see more requirements, even for on-label usage, such as requiring a patient to fail one drug before another can be used. Off-label indications, even when they have become an accepted standard of care, present challenges. Payers don’t routinely support a non-FDA-approved indication, the process for these approvals is much more rigorous. And with these drugs [checkpoint inhibitors], we’re already seeing a lot of off-label use, because there is strong data to support it. Biomarkers will continue to grow in importance as data on new indications precede an actual FDA approval.

When your staff is doing prior authorization applications, what information are they having to provide in order to communicate with the payers?

Griffith:  It’s important for staff to review the payer policies that are posted online. Larger payers have detailed polices which state exactly what information must be provided, such as previously failed therapies and performance status. We haven’t historically seen requirements for providing this type of information, but this trend is likely to continue and to grow. Policies for the I-O therapies can be a page or more in length.

And do you ever run into the situation then where payers are asking for information that you don’t necessarily have at hand or hasn’t been documented?

Griffith: Yes, that’s a concern, and [that’s] why clinical staff must be interacting with payers. Even staff that have been in roles for years that included performing prior authorizations and managing denials require additional training to meet these new requirements. Now they minimally require “view only” access to screens detailing patient-specific clinical information, access not needed previously. I can’t recommend one specific “go to” resource to assist with training staff on the complex reimbursement requirements. Professional societies such as the Association of Community Cancer Centers (ACCC) do provide various helpful resources, and educational sessions at their meetings.

Are there particular tools or resources that could be helpful for combination therapy reimbursement?

Griffith: No, not specific to combination therapy, because the same principals apply to any therapy. It’s important to stay on top of the payer policies, because often you find out about the changes only after receiving a rejection. In my experience, payers are not good about telling you when they make a change; organizations need to assign staff to monitor the policies for changes. Monthly payer meetings in your organization can be a helpful way to find out about payer policy changes.

Equally important is having a process to feed that information back to the people that are doing the approvals and the denials so they are able to avoid a rejection, or to submit a successful appeal. Cancer centers will need to make sure that they have a solid infrastructure in place to support prior authorization for combination therapies before they start using them, or their bottom line will suffer.

Cancer centers will need to make sure that they have a solid infrastructure in place to support prior authorization for combination therapies before they start using them, or their bottom line will suffer.

How do you think combination therapies are going to influence the conversation on value-based care and risk-sharing?

Griffith: I think the conversation becomes more challenging, because to enter a risk-sharing agreement, it’s necessary to have strong data on the risks and benefits of each of the agents and how that may change when they are used in combination. When making treatment decisions in a risk-sharing arrangement, the combined use data becomes more important than the data for each individual agent. Unfortunately, we often don’t have enough information to make that determination and it becomes difficult to predict why a patient hasn’t responded appropriately. If the risk-sharing agreement is for only one of the agents, how will we know which one is the cause of not having the response that was expected?

Combination therapies add another layer of complexity to the risk-sharing models that are being discussed (Figure 1.) and will be difficult to implement. Most organizations are just beginning to entertain conversations about risk-sharing. Although there are centers who have been progressive and have entered into an arrangement, it is not the norm.  I think many cancer centers are still intimidated by the concept of a risk-sharing arrangement.

It won’t be long until expensive combination therapies become a phenomenon that we’re dealing with every day. Unfortunately, their use adds another layer of complexity to a situation that’s already gotten so complex and resource intense for organizations.  It is reasonable for there to be scrutiny around the use of expensive medications, but at times it seems that there are unnecessary obstacles for their approval and payment. Like everything else, practices will find ways to cope, as they strive to ensure patients have access to innovative therapies, regardless of their cost.

References                                             

  1. Larkin J, Chiarion-Sileni V, Gonzalez R, et al. Combined nivolumab and iIpilimumab or monotherapy in untreated melanoma. N Engl J Med. 2015;373(1):23-34.
  2. Beasley D. The cost of cancer: new drugs show success at a steep price. Reuters Health News. April 3, 2017. http://www.reuters.com/article/us-usa-healthcare-cancer-costs-idUSKBN1750FU
  3. Ott PA, Hodi SF, Kaufman HL, et al. Combination immunotherapy: a road map. J ImmunoTher Cancer. 2017;5:16.