Insurers are also looking closely at the cost of CAR-T therapies. In early April, UnitedHealth Group, the largest player in Medicare Advantage with about five million members and 25% of the market, asked the Trump administration to rule on just what an insurer’s obligations are for Medicare beneficiaries regarding CAR-T coverage. America’s Health Insurance Plans warns that there’s not enough clinical evidence to mandate coverage. But CAR-T has been proven to be effective in some patients whose cancer has not responded to traditional chemotherapy or radiation, one of the reasons the FDA approved it for certain blood cancers.
There’s also this: Perhaps insurers lack an incentive to control costs.
A report issued in March by the Medicare Payment Advisory Commission (MedPAC) focused on the rising costs in Medicare Part D from 2007 to 2017. In 2007, only 6% of spending in Medicare Part D was for specialty drugs. By 2017, that proportion jumped to 25%.
The cost of the drugs drives thousands more beneficiaries into Part D’s catastrophic phase, where the insurer pays 15%, the enrollee 5%, and the government 80%. This year, the catastrophic phase is reached when a beneficiary pays $5,100 in out-of-pocket costs. About 33,000 beneficiaries filled a prescription that put them in the catastrophic phase in 2010; that jumped to 360,000 by 2016.
Medicare payments to Part D plans, which most Medicare Advantage plans offer, increased from $46 billion in 2007 to $80 billion in 2017.
Caron A. Jacobson, MD, director of a cell therapy program at the Dana-Farber Cancer Institute in Boston, tells the New York Times that the price tag may not be as daunting as it looks in context; “when you actually consider what you are paying for over the course of someone’s lifetime, and you think about the cost of other therapies that this is replacing, it actually is not astronomical.”