HHS estimates $73 million in savings if Congress extends immunosuppressive drug coverage

A new HHS report estimates that Medicare would save $73 million during the course of 10 years if Congress extends coverage of immunosuppressive drugs beyond the current 3 years post-transplant.

President Donald J. Trump signed the 2019 appropriations spending package into law in October 2018 that included completion of an HHS-directed study on determining the cost of lifetime coverage for anti-rejection drugs for transplant patients.

Medicare offers lifetime immunosuppressive drug coverage for people older than 65 years who are diagnosed with ESKD and receive a kidney transplant. Those younger than 65 years, however, who qualify for Medicare based on their diagnosis of ESKD only receive coverage for 3 years after the transplant. Various studies have shown that patients who cannot obtain insurance coverage and cannot afford the cost of the drugs, which according to a 2017 Milliman and Associates report average around $17,000 per year, lose the transplant to rejection and end up back on dialysis.

Legislation has been introduced several times to extend the immunosuppressive drug coverage but has failed to win Congressional passage. The last bill, the Immunosuppressive Drug Coverage for Kidney Transplant Patients Act, was introduced in September 2016.

The HHS report, released May 10 by the Office of the Assistant Secretary for Planning and Evaluation (ASPE), analyzed the financial implications of extending Medicare coverage specifically for immunosuppressant drugs for more than 3 years post-transplant.

“Providing limited Medicare coverage for only immunosuppressive drugs could result in savings associated with preventing reversion to dialysis and may have the added benefit of supporting transplant recipients in deciding to transition off Social Security Disability Insurance and Medicare,” according to the report. “This may enable transplant recipients to return to the labor market and possibly enroll in private health insurance coverage, since they may be less concerned about losing coverage for their immunosuppressive drugs.”

To determine the potential savings, ASPE said it projected the number of kidney transplants for patients younger than 65 years by insurance status, graft failure and survival rates, costs of the mix of immunosuppressive drugs historically prescribed to patients, and dialysis costs using a rolling average of historical trends in the United States Renal Data System (USRDS). The analysis also uses data from a United Network for Organ Sharing survey and the CMS National Health Expenditure projections.

The results, according to the report, showed that extending Medicare coverage of immunosuppressive drugs beyond 3 years post-transplant would result in savings to Medicare starting in the fifth year of extended coverage.

“ ... The federal investment required to cover the costs of extending coverage for immunosuppressive drugs would grow at a slower rate than the savings generated by averting cases of reversion to dialysis, resulting in net savings of $0.1 million in the fifth year of policy implementation and increasing in each subsequent year resulting in an accumulated 10-year savings of approximately $73.4 million,” according to the report. “If trends remain as they have, the annual savings to Medicare would continue to increase each year, as would the accumulated net savings.”

The authors of the report estimate that, in 2015, the average cost to Medicare of a patient reverting to dialysis from a failed transplant was $116,902 in the first year post-transplant. That dropped to $91,306 in later years after the transplant loss.

Milliman and Associates estimate that a kidney transplant costs just more than $400,000.

References:

https://aspe.hhs.gov/pdf-report/assessing-costs-and-benefits-extending-coverage-immunosuppressive-drugs-under-medicare

www.milliman.com/insight/2017/2017-U_S_-organ-and-tissue-transplant-cost-estimates-and-discussion/

 

A new HHS report estimates that Medicare would save $73 million during the course of 10 years if Congress extends coverage of immunosuppressive drugs beyond the current 3 years post-transplant.

President Donald J. Trump signed the 2019 appropriations spending package into law in October 2018 that included completion of an HHS-directed study on determining the cost of lifetime coverage for anti-rejection drugs for transplant patients.

Medicare offers lifetime immunosuppressive drug coverage for people older than 65 years who are diagnosed with ESKD and receive a kidney transplant. Those younger than 65 years, however, who qualify for Medicare based on their diagnosis of ESKD only receive coverage for 3 years after the transplant. Various studies have shown that patients who cannot obtain insurance coverage and cannot afford the cost of the drugs, which according to a 2017 Milliman and Associates report average around $17,000 per year, lose the transplant to rejection and end up back on dialysis.

Legislation has been introduced several times to extend the immunosuppressive drug coverage but has failed to win Congressional passage. The last bill, the Immunosuppressive Drug Coverage for Kidney Transplant Patients Act, was introduced in September 2016.

The HHS report, released May 10 by the Office of the Assistant Secretary for Planning and Evaluation (ASPE), analyzed the financial implications of extending Medicare coverage specifically for immunosuppressant drugs for more than 3 years post-transplant.

“Providing limited Medicare coverage for only immunosuppressive drugs could result in savings associated with preventing reversion to dialysis and may have the added benefit of supporting transplant recipients in deciding to transition off Social Security Disability Insurance and Medicare,” according to the report. “This may enable transplant recipients to return to the labor market and possibly enroll in private health insurance coverage, since they may be less concerned about losing coverage for their immunosuppressive drugs.”

To determine the potential savings, ASPE said it projected the number of kidney transplants for patients younger than 65 years by insurance status, graft failure and survival rates, costs of the mix of immunosuppressive drugs historically prescribed to patients, and dialysis costs using a rolling average of historical trends in the United States Renal Data System (USRDS). The analysis also uses data from a United Network for Organ Sharing survey and the CMS National Health Expenditure projections.

The results, according to the report, showed that extending Medicare coverage of immunosuppressive drugs beyond 3 years post-transplant would result in savings to Medicare starting in the fifth year of extended coverage.

“ ... The federal investment required to cover the costs of extending coverage for immunosuppressive drugs would grow at a slower rate than the savings generated by averting cases of reversion to dialysis, resulting in net savings of $0.1 million in the fifth year of policy implementation and increasing in each subsequent year resulting in an accumulated 10-year savings of approximately $73.4 million,” according to the report. “If trends remain as they have, the annual savings to Medicare would continue to increase each year, as would the accumulated net savings.”

The authors of the report estimate that, in 2015, the average cost to Medicare of a patient reverting to dialysis from a failed transplant was $116,902 in the first year post-transplant. That dropped to $91,306 in later years after the transplant loss.

Milliman and Associates estimate that a kidney transplant costs just more than $400,000.

References:

https://aspe.hhs.gov/pdf-report/assessing-costs-and-benefits-extending-coverage-immunosuppressive-drugs-under-medicare

www.milliman.com/insight/2017/2017-U_S_-organ-and-tissue-transplant-cost-estimates-and-discussion/

 

    See more from Healio Special Report: Health Care and Politics