Incorporating New Treatments Technologies Can Your Program

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					Incorporating New Treatments
  & Technologies: Can Your
 Program Afford It? Can You
       Afford Not To?

           Gary A. Goldstein
             Financial Coordinator
 Stanford Blood & Marrow Transplant Program
                Case Studies

1.   Kepivance (palifermin)

2.   Mozobil (plerixafor)

3.   Isolex (cell sorter)

4.   Defibrotide (anticoagulant)
Payor Mix & Reimbursement Strategies


   Commercial Insurance & HMO’s
    – Fee For Service
    – Case Rates


   Medicare

   Medicaid
                Commercial

   Fee for service (% discount)

   Case rate structure
                    Medicare

   Inpatient DRG

   Outpatient Fee Schedule

   Professional Fees
          Medicaid (Medi-Cal)

   Inpatient per diems

   Outpatient fee schedules

   Professional Fees
    Transplant Case Rate Contracting

   When does the case rate start?

   Is mobilization included?

   Is cell collection included?

   How is the preparative regimen defined?
           Case #1 - Kepivance
               (palifermin)

   Indicated “…to decrease the incidence and
    duration of severe oral mucositis in patients with
    hematologic malignancies receiving myelotoxic
    therapy requiring hematopoietic stem cell
    support.”
    Case #1 - Kepivance (cont)

3 doses should be administered prior to myelotoxic
  therapy, with the third dose 24 to 48 hours
  before myelotoxic therapy.

3 doses should be administered post myelotoxic
  therapy, starting after, but on the same day of
  hematopoietic stem cell infusion.
Schema – Stanford Autologous HCT
      for Multiple Myeloma

Day   -7:   Kepivance
Day   -6:   Kepivance
Day   -5:   Kepivance
Day   -4:   BCNU
Day   -3:   Rest
Day   -2:   Melphalan
Day   -1:   Rest
Schema – Stanford Autologous HCT
   for Multiple Myeloma (cont)

Day 0: Autologous hematopoietic cell
 infusion & palifermin

Day +1: Palifermin

Day +2: Palifermin
              Dollars & Cents
   Cost, charge & reimbursement figures
    discussed today are generalizations and
    used for example purposes only. Actual
    figures may be proprietary.

   Assumption – Cost of Kepivance may be
    offset by 1 or 2 less inpatient days due to
    mucositis.
         Reimbursement modeling –
           Commercial Insurance
       Fee for service, Medicare & Medicaid
    – Is mark-up greater than or equal to discount
      provided?
       Case rates
    – What is the case rate starting point?
            Is Palifermin part of the preparative regimen?
    -     When does the case rate end?
         -   Are post-discharge days included in the case
             rate?
         Palifermin – The Stanford
                 Experience
- Drug was administered at the Transplant Center
- Decision was made to consider this part of the
  transplant’s preparative regimen (therefore
  included in most case rates)
- Minimal reduction in post-transplant inpatient
  LOS.
- Patients had trouble coming to the transplant
  center several days early
    - Local housing, caregiver, & childcare were all issues
 Case #2 – Mozobil (plerixafor)

Indicated “…in combination with G-CSF to
  mobilize hematopoietic stem cells to the
  peripheral blood for collection and
  subsequent autologous transplantation in
  patients with NHL and multiple myeloma.”
           Mozobil (plerixafor)

-   Once a patient is identified as a poor
    mobilizer, plerixafor injections are
    administered SQ/QD for 1 to 4 days,
    starting 11 hours prior to apheresis.

-   It is discontinued when adequate cells
    have been collected.
    Cost & Reimbursement Factors

-   Will patients self-inject or will patients
    receive the injection at the Transplant
    Center?
-   How soon can patients be identified as
    poor collectors (Mozobil candidates)?
-   Assumption – Cost of 1-2 doses equals
    that of a bone marrow harvest.
Reimbursement modeling – Commercial
            Insurance

   Fee for service (% discount)
    – Is mark-up greater than or equal to discount
      provided?
   Case rates
    – Is mobilization included in the case rate?
    - Can patient get Mozobil through their
      prescription drug plan?
    Mozobil – The Stanford Experience
-   Drug is administered at the Transplant
    Center
-   Considered part of Mobilization phase (in
    some case rates, not in others)
-   Planned for 1-2 doses, but some patients
    have needed up to 4 injections.
-   All patients have collected adequate cell
    doses for transplant
       Mozobil – The Stanford
         Experience (cont)
- All poor collectors have had higher than average
  charges.
- Some Mozobil patients have been cost-neutral
  vs. those that went on to marrow harvest, but
  others had increased costs.
- Over all, a slight negative impact on cost but
  clinically successful. The program is willing &
  able to accept additional costs in some cases.
     Case #3 – Isolex Cell Sorter
-   Used for positive cell selection
-   AKA Miltenyi device
-   No FDA approval in USA due to Baxter
    Isolex patent
-   FDA approval given to as an
    investigational device
-   Being used in haploidentical transplant
    trial
 Cost & Reimbursement Factors

Significant cost factors include:

  - Initial capital investment for the device

  - Sorting kit (individual use)

  - Lab tech time
Reimbursement modeling – Commercial
            Insurance

 Charge is for the process (cell selection)
  and not for the device
 Considered part of allogeneic cell
  collection
 Related donor cell collection is usually
  within a case rate
 Added charges but no cost offset
    Isolex – The Stanford Experience
   Major capital outlay

   Use cost is billed but doesn’t always increase revenue

   Allows significant new protocols including allogeneic HCT
    using haploidentical donors
    – Increased patient numbers
    – Differentiates our program from the crowd
    – Could be a key to separate Graft vs Malignancy from GvHD


   Dollar-based stop loss avoids major negative impact on
    bottom line
          Case #4 – Defibrotide

   Anticoagulant used to treat or prevent a failure of
    normal blood flow (Veno-occlusive disease, VOD) in the
    liver of patients who have had HCT.
   Used outside of the USA, but not FDA approved for open
    use within the USA.
   FDA gave orphan drug designation in 2007.
   Gentium is sponsoring research in the USA.
    Cost & Reimbursement Factors

-   Drug was provided at no cost by maker,
    but they will now start charging
    Transplant Centers.
-   Typically administered during inpatient
    hospital stays, often soon post-transplant.
-   Assumption – Cost will be significant, but
    VOD is a costly and deadly complication
Reimbursement modeling – Commercial
            Insurance

 Can a transplant provider charge for a
  non-FDA-approved medication?
 Charges will almost always be within the
  BMT case rate.
 Clinical need is tremendous.
 Patients with VOD can turn into
  catastrophic cases that are major charge
  outliers.
    Defibrotide – The Stanford Experience


-   Clinically the drug appears very useful.

-   We are working with our Compliance
    Officers to see how this drug can be
    added to our Charge Master.

-   We must educate insurance companies in
    order to obtain authorizations when
    needed and avoid claim denials.
             Lessons learned
-   Medicare & Medical have rigid reimbursement
    schedules that may not cover costs.

-   Payor mix is extremely important.
    Nonmyeloablative allogeneic HCT has led to a
    significant increase in the percentage of
    Medicare patients.

-   Can Transplant Centers influence Medicare
    reimbursement? Yes, but it’s not easy.
       Commercial Ins Contract
            Structures
 Case rate contracts are the norm
 What’s in a case rate can vary widely
 Auto HCT
    – Should mobilization be included?
    – Should G-CSF (& Mozobil) be included?
    – Should apheresis or BMT harvest be included?
   How long post-transplant should the case
    rate go?
         Case rate contracting
   Should a Transplant Center negotiate
    carve-outs for new drugs & technologies?

   A well-designed case rate structure can
    help with adoption of new
    treatments/technologies

   Dollar-based stop-loss?
                   In Closing
   Failure to adopt new treatments & technologies
    and take advantage of new medicines (including
    biopharmaceuticals) will drag your program
    down clinically. HCT must move forward.

   Failure to adequately structure contracts can
    leave a center financially unprotected. Programs
    can’t make clinical strides while going broke. At
    least not for long.