Updated Apr 18, 2018 - Health

Cancer hospitals push for Medicare CAR-T payments

The sign outside Memorial Sloan Kettering Cancer Center.

Memorial Sloan Kettering Cancer Center in New York City. Photo: Smith Collection / Gado via Getty Images

Lobbyists representing cancer hospitals are urging Medicare officials to create a new set of payments for new, expensive CAR-T treatments.

Looking ahead: Medicare is expected to release a big annual payment rule any day now, and there's a chance it could propose "add-on" payments for CAR-T therapies — a move that would cost the government millions of dollars while immediately broadening dying cancer patients' access to promising new treatments.

The details: Federal meeting records show four lobbyists working on behalf of cancer hospitals like Memorial Sloan Kettering Cancer Center and MD Anderson met with Medicare officials in February — including Demetrios Kouzoukas, a top Medicare director in the Trump administration — to talk about the proposed inpatient payment rule that is released every April.

Specifically, they discussed Medicare's payment policies for CAR-T, a therapy that attacks cancer by using a patient's own immune cells. Two CAR-T treatments have gotten FDA approval:

  • Kymriah, made by Novartis, has a list price of $475,000.
  • Yescarta, made by Gilead Sciences, has a list price of $373,000.

The rub: Medicare has approved outpatient rates for CAR-T at the standard price plus 6%, but the cost of inpatient CAR-T treatments is rolled into smaller bundled amounts that encompass the entire hospitalization.

Why it matters: Cancer doctors have only been comfortable providing CAR-T on an inpatient basis because the treatment is still new and patients need to be monitored closely for adverse reactions.

  • Many hospitals "would like to start the program, but not without adequate reimbursement from Medicare," said one person familiar with the industry, adding that Medicare officials "know it's a problem."

Go deeper: Bloomberg profiled CAR-T insurance hurdles in December.

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