If Medicare increased its reimbursement for intravitreal bevacizumab (Avastin, Roche/Genentech) to equal what retina specialists get for a more costly competitor, it would actually reduce payer and patient costs by more than $500 million annually, according to a cost-analysis study published in the journal Ophthalmology.1
The idea of increasing reimbursement for a lower-cost medication is controversial. The study drew on ISIS Registry data of 2.6 million intravitreal injections for Medicare fee-for-service patients in 2018. The estimates are calculated on Medicare costs of $1,559.76 for aflibercept and ranibizumab 0.5 mg (Eylea, Regeneron Pharmaceuticals, and Lucentis, Roche/Genentech) and $855.91 for Lucentis 0.3 mg, with patients responsible for 21.2 percent of the average sales price for these drugs, and $70.56 for bevacizumab, with the patient covering 20 percent.
The study calculated that the total physician payment above cost for Eylea is $80.78 vs. about $25 for Avastin. Medicare would actually cut costs by adding that $80.78 to the reimbursement for Avastin, the study states.
The study notes that Medicare Part B spends more than $3.5 billion annually on anti-VEGF drugs and the volume of intravitreal injections has been increasing 6 to 8 percent a year over the past five year.
Lead study author David B. Glasser, MD, of Johns Hopkins University and the American Academy of Ophthalmology’s secretary for federal affairs, tells Retina Specialist that now that the paper has been published, the next step is to take this data back to Medicare administrative contractors (MACs) to convince them to increase payment for Avastin.
As it is, the study found that Avastin injections have been decreasing steadily, from more than 70 percent in 2012 to 55 percent in 2013 to 45 percent in 2018.
Of course, the cost equation for Avastin changed more so last summer when United States Pharmacopeia issued stricter requirements for syringes, driving up costs specialty pharmacies passed onto physicians. “The cost went up last summer and the reimbursement did not,” Dr. Glasser says. “Practices who were sort of limping along and still giving Avastin at a break-even or maybe a very slight loss were now underwater and stopped using it.” By 2019, IRIS data showed, Avastin accounted for a little more than one-third of all Medicare fee-for-service intravitreal injections.
He notes that many retina specialists have stuck with Avastin “despite the fact that they were making very little money or possibly even losing money on each injection, and the reason they did it was because they thought it was the right thing for the patient.”
But does that mean there’s enough upside demand for Avastin to justify Medicare increasing the physician fee for it? Dr. Glasser and colleagues found a study of a regional health plan that reported a 9-percent increase in Avastin use by increasing its reimbursement to be competitive with Eylea and Lucentis.2 “Do we think there’s anything fundamentally different in Medicare fee for service?” Dr. Glasser says. “Probably not. In fact, there might even be more suppression of Avastin use based on the poor reimbursement when you consider that some MACs are paying as little as $50 for the drug.”
The study modeled Medicare savings on 5-, 7.5- and 10-percent increases in Avastin market share. The model breaks even with a 0.74- percent increase. The 10-percent increase would yield $468 million in Part B savings and a $119 million reduction in patient co-pays annually. RS
1. Glaser DB, Parikh R, Lum F, Williams GA. Intravitreal anti-vascular endothelial growth factor cost savings achievable with increased bevacizumab reimbursement and utilization. Ophthalmology. Published online June 13, 2020.
2. Kelly K, Bhatt S, Aten A, Stockman C, Sumner A, Denno M. Cost of care initiative: Analyzing a least cost alternative program with specialty ophthalmic injections under the medical benefit. J Manag Care Spec Pharm. 2018;24:S105.