Insurance Coverage Of Biopharmaceuticals

It is by now readily apparent to all concerned that new, breakthroughbiopharmaceuticals pose a difficult challenge to existing arrangementsfor financing care because of their high costs, the small patientpopulations they often serve, and problems in measuring theirincremental therapeutic value. How the U.S. health system dealswith this challenge will reflect its unique and intricate mixof public and private institutions and processes. In a shiftfrom an earlier era of scientific exploration financed primarilyby government, the discoveries that paved the way for today’sbiopharmaceuticals have been underwritten by private investorsas well as public sources. By the same token, payment policiesfor the new treatments derived from breakthroughs in molecularmedicine are hatching pluralistically among public and privateinsurers.

In the first of these papers, Jamie Robinson describes how privateinsurers have so far resorted to an ad hoc application of familiartools such as medical management, network controls, and benefitdesign. However, Robinson argues, these insurers "possess onlymodest social legitimacy to decide which patients should receivewhich drug in a context of scientific uncertainty. They cannotserve as society’s fulcrum for comparing and balancingthe cost and quality of novel therapeutics." In contrast, SeanTunis and Steve Pearson describe an exquisitely rational attemptby the Centers for Medicare and Medicaid Services (CMS) to balancepatients’ access with prudent financial and medical managementby calibrating Medicare coverage decisions rigorously to evolvingclinical evidence—only to find that implementation ofthis elegant policy is hedged at every turn by the competingdemands of patients, providers, legislators, and manufacturers.

The remaining papers plunge deeper and deeper into the labyrinth.Tanisha Carino and colleagues explore in greater depth the applicationof the CMS’s new "coverage with evidence development"(CED) policy to new biopharmaceutical treatments for colorectalcancer. Patients and clinicians see life-saving opportunitiesin using these expensive cancer drugs for uses not approvedby the Food and Drug Administration (FDA), creating excruciatingdilemmas for politically accountable public payers. Under Medicare’snew Part D drug benefit, though, access to new cancer treatmentsis mediated by private drug plans, which have substantial discretionover formulary design and patient cost sharing but are likelyto be subject to increasing budget pressure in the future, asJennifer Bowman and colleagues explain. Dennis Cotter and colleaguesgo on to describe how private-sector pressures may impinge onMedicare payment policy; and Patricia Keenan and colleaguesassess the future of evidence-based coverage policy and considerationof cost-benefit trade-offs.

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Insurance Coverage Of Biopharmaceuticals