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Avalere Report Identifies Coverage Barriers to Oral Cancer Drugs

Contact: Lindsey Spindle, 202.207.1337, lspindle@avalerehealth.net

02.18.10

Washington, DC – Washington, DC – Cancer patients frequently face barriers to accessing oral oncology drugs compared to those delivered intravenously, finds new research from Avalere Health.  The new study sheds light on the tensions between therapeutic innovation, physician decision-making, insurance design, and the patient experience.

Today’s bifurcated insurance design – wherein medical benefits cover physician-administered drugs and pharmacy benefits cover patient-administered drugs – often results in higher cost-sharing requirements for oral oncology products, making them less affordable than traditional cancer drugs.  Despite this set-up, a recent Modern Medicine study reveals that 25% of the cancer drug pipeline is geared toward creation of oral oncolytics – a trend that creates both opportunities and challenges in cancer care.

To better understand the coverage environment as it relates to oncology products, Avalere worked with the Community Oncology Alliance (COA) to review 2009 Medicare Part D plan formularies and formularies of select private payers.  In particular, Avalere analyzed coverage of 11 common oral oncolytics, looking at coverage determinations and cost to patients.

Of the 11 oncolytics studied, only three – Hycamtin, Temodar, and Xeloda – had Medicare Part B coverage, while the remaining eight – Gleevec, Tykerb, Tarceva, Sutent, Revlimid, Nexavar, Tasigna, and Tamoxifen – were covered under Medicare Part D.  Of the eight drugs covered under Part D, Avalere found the most common formulary tier placement was the highest tier, where patients pay a large portion of a drug’s cost out of pocket.  Depending on the insurance plan, this could range from tier three to tier five, where cost sharing is typically a co-insurance requirement ranging from 25 percent to 55 percent of the drug costs.  The report notes that such a requirement could add up quickly; for example, a patient with Universal American’s Community CCRx Basic plan taking Revlimid for one year could expect to pay out-of-pocket costs of about $8,678.  

“As new oncology products emerge, payment systems and physician practices must innovate to ensure patients have access to the most clinically appropriate drug for each patient,” said Lauren Barnes, a vice president at Avalere Health and co-author of the report. “Cost-sharing inequity between pharmacy and medical benefits is a palpable challenge created by the current coverage of oncolytics.  This will become an increasingly important issue to evaluate and potentially reform as more oral oncolytics enter the marketplace.” 

Beyond its review of drug coverage, Avalere also interviewed 54 individuals familiar with oncology care to identify the most common barriers to oral oncolytics and potential solutions for addressing those barriers.  The interviewees stated that access barriers to oral oncolytics fell into five categories – administrative, clinical, compliance, patient experience, and reimbursement – each affecting patient access. While all stakeholders were unified in their belief that patients should receive the most clinically beneficial therapy, they also recognized that treatment decisions had to account for the burdens of everyday life, cost sharing, and side effects. 

The study, “Oral Oncolytics / Addressing the Barriers to Access and Identifying Areas for Engagement,” was authored by Lauren Barnes, Molly Burich, Brian Haroldson, Arlene Little, and Margaret Nowak, all of Avalere Health. The study was conducted and written on behalf of COA, which provided funding for this research.  Avalere maintained editorial control, and the conclusions expressed in its research are solely those of the authors. For more information on this research project and its funding, please visit www.communityoncology.org/oral-oncolytics-study-funding-information.

Avalere Health is an advisory services company whose core purpose is to create innovative solutions to complex healthcare problems. Based in Washington DC, the firm delivers research, analysis, insight, and strategy for leaders in healthcare business and policy. Avalere's experts span 125 staff drawn from the federal government (e.g., CMS, OMB, CBO, and the Congress), Fortune 500 healthcare companies, top consultancies, and nonprofits. The firm offers deep substance in areas ranging from healthcare coverage and financing to the changing role of evidence in healthcare decision-making. Its focus on strategy is supported by a rigorous, in-house analytic research group that uses public and private data to generate quantitative insight. Through events, publications, and interactive programs, Avalere also translates real-time healthcare developments into actionable information.

Learn more at www.avalerehealth.net.

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