New Rules to Deprive Seniors of Drugs, Doctors

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Two provisions in lengthy proposed regulations published by the Centers for Medicare and Medicaid Services in the Federal Register on January 10 would deprive seniors of vital drugs and make it more difficult for them to see their doctors.

These provisions should be changed before the regulations become final. Comments are due by March 7.

The proposed regulations limit the drugs covered under Medicare's Part D, the prescription drug component of the program, beginning in 2015.

Now Part D plans have to include drugs within six drug classes, namely antineoplastics, anticonvulsants, antiretrovirals, antipsychotics, antidepressants, and immunosuppressants. CMS is proposing no longer to require all drugs from the antidepressant and immunosuppressant drug classes to be covered by Part D.

Seniors would no longer necessarily have access to insurance for these drugs, with serious consequences. Depression is the most frequent mental health problem in the elderly, and lack of treatment can lead suicide. Depressed patients can cause difficulties for family members and caregivers.

Immunosuppressant drugs are used in the case of a transplant, to prevent the body from rejecting a transplanted organ. Cutting back on these drugs mean that transplants would be more risky and less successful. This would decrease life expectancy of seniors.

CMS calculates that the savings from disallowing these drugs would be $720 million over the five-year period 2015 to 2019. That is $144 million a year, two tenths of one percent of the $677 billion in net Medicare outlays in 2019. In comparison, spending on HIV/AIDS remains untouched, at almost $30 billion in 2014.

Reducing access to major classes of drugs that were required from the beginning of the Part D program would cut Medicare costs by shortening seniors' lives, but it is not the direction in which our society wants to go. Congress should demand a true cost-benefit analysis of trimming antidepressant and immunosuppressant drugs, including a calculation of the value of lives that could have been saved with the drugs.

As well as depriving seniors of drugs, CMS wants to deprive them of their doctors.

Doctors are dropping out of Medicare due to low reimbursements and massive paperwork. But under the proposed regulations, if seniors receive prescriptions from doctors who do not participate in Medicare, these prescriptions cannot be covered under Part D. This holds even if the senior is paying for Part D.

Since pharmaceuticals are often costly, this regulation, if made final, would have the practical effect of requiring seniors to see doctors who are enrolled in Medicare.

In 2012 another 9,500 doctors left Medicare, according to CMS. (Data are not yet available for 2013.) This is happening as baby boomers are turning 65 and signing up for Medicare and Social Security in record numbers.

Doctors can be "nonparticipating," where they file claims to Medicare but charge more and bill patients for the difference. Doctors can also opt out of Medicare entirely. They file no claims and patients pay out of pocket.

Under the Affordable Care Act, physicians who order medical devices and home health care must be enrolled in Medicare. The newly-proposed rules would extend this to drugs and all other Medicare services.

Regulations say that this is to prevent fraud and abuse, but the clear intention is to prevent seniors from visiting physicians outside the Medicare system. The government program is becoming increasingly unattractive to both patients and providers, so CMS wants to make sure that no one leaves.

Of course, if seniors visited doctors privately, that would save Medicare the cost of the visit. But CMS says that the proposal does not have any costs or savings, because "we presume that if a beneficiary's prescriber is not enrolled or does not enroll in Medicare, the beneficiary will find a new prescriber who is enrolled, rather than go without needed medications. Therefore, we do not estimate any savings from this proposal."

This reasoning neglects the cost of a patient's time, a patient who might not be able to find a convenient Medicare provider within a reasonable period. It also neglects the peace of mind for those who have seen a doctor for years and who will be forced to see a different one.

The language in the CMS fact sheet announcing the proposed rule is positively Orwellian and reflects the CMS mindset. On page 2 it reads, "In order to ensure that beneficiaries have better access to health plan services....CMS proposes that Prescription Drug Plan Sponsors offer no more than two Part D plans in the same service area." It makes no sense that to offer better access the number of Part D plans is being limited.

The newly-passed fiscal year 2014 budget cuts $10 million from the Independent Payment Advisory Board, which was given the power under the Affordable Care Act to disallow medical drugs, devices, and procedures that the Board deemed too costly and therefore inefficient. But the new regulations show that CMS has taken over the rationing role.

As our economy grows and society gets wealthier, it is natural that people want to spend more on health care, making their lives longer and more comfortable. By reducing seniors' freedom to contract with private doctors, and taking vital drugs out of the Medicare program, CMS is being penny-wise and pound-foolish.

Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is senior fellow and director of Economics21 at the Manhattan Institute. Follow her on Twitter: @FurchtgottRoth.   

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