Drug Costs

IPI Comments Running 1000:1 Against

January 24, 2019 10:07 am

The Centers for Medicare and Medicaid Services (CMS) received more than 2,000 comments regarding its proposal to adopt the International Pricing Index (IPI) for Medicare prescription drugs. We’ve highlighted some of these comments, but STAT News reporter Nicholas Florko also has read them – more than he’d “like to admit,” he said.


His conclusion?


Only two groups “unequivocally” support the administration’s proposal – Patients for Affordable Drugs and Memorial Sloan Kettering’s Drug Pricing Lab, both of which are funded by hedge-fund billionaire John Arnold. Florko noted one group of Medicare advisers even warned the IPI model “has several structural features that hamper its feasibility.” Meaning? It might not work as envisioned, or at all.


One organization that’s certain the model won’t work for patients is the American Action Forum (AAF). In her comments to CMS, AAF Deputy Director of Health Care Policy Tara O'Neill Hayes, who is a member of the National Academy of Social Insurance (a nonprofit, nonpartisan group of experts on programs like Social Security and Medicare), said – unequivocally – that the IPI model would reduce access to life-saving and life-enhancing medications.


Hayes noted the 14 countries CMS has proposed using in its model have, on average, access to just 48 percent of the new drugs developed in the past eight years. Hayes also explained it took these countries about 16 months longer to get the medicines it does have on the market. She concluded, “If the United States adopts the prices of those countries, American patients may very well face the same access restrictions as exist in those countries and lose access to existing treatment options.”


Hayes also estimated adoption of the IPI would reduce revenues by $9 billion annually, a sum equivalent to the cost to bring three drugs to market. She also warned IPI could raise costs for other types of health insurance, including employer-sponsored health plans.


In a recent column in The Hill, Jesse Milan Jr., president and CEO of AIDS United in Washington, D.C., also argued IPI would harm patients.


Milan has lived with AIDS for more than three decades. Noting new treatments are the reason the number of AIDS deaths has dropped from 500,000 annually in 1995 to less than 7,000 today, Milan explained CMS’s proposal “would clear the way for prior authorization” – allowing health insurers to determine if a drug is necessary before it’s administered – a “hurdle that delays and discourages people from getting their medications.”


Milan also warned IPI could result in the adoption of step therapy. He cited AIDS patient Scott Daly who, in 2015, told New York state lawmakers “Step therapy puts patients like me who are stable on proven medications at risk unnecessarily. … Failure on this new drug would mean failure of the entire regimen, which has been successful keeping me virally suppressed for the past 10 years.” (More on step therapy here.)


If Medicare experts are skeptical and patients are fearful, it’s time for the administration to rethink its IPI proposal.