LIZ GIBSON: Medicare cuts are hurting California’s elderly and sickest

Posted by Kassy Perry

Recent budget proposals in Washington include several dramatic and potentially devastating changes to Medicare. These proposed budget cuts fall particularly hard on drugs covered under Medicare Part B. This is the part of the program that covers care for those Medicare patients with conditions that are treated by injected or infused drugs that must be administered by physicians, like cancer and multiple sclerosis.

Although I am not currently a Medicare patient, I will be one in the future and I am concerned now about patients who are currently on Medicare and undergoing chemotherapy. I’m a fairly typical oncology patient. Every three weeks, I visit my oncologist to receive infused and injected treatments for cancer.

Receiving this treatment at my physician’s office in my community instead of in a hospital not only makes chemotherapy less unpleasant, it saves money. Studies have shown that total costs of care are lower for chemotherapy patients treated in a physician’s office setting compared to a hospital setting. It’s partly for this reason that four in five American cancer patients are treated in a community setting.

While some politicians in Washington are trying to change this through severe cuts, patients like me would prefer to keep receiving quality care close to home.

Part B reimburses physicians and clinics according to a formula based on the average sale price of the medications, plus a 6 percent add-on. This is called “ASP +6” pricing.

This add-on is intended to cover the costs associated with administering the drugs: supplies, shipping, nursing staff and patient education, just to name a few.

Physicians are now dealing across the board Medicare payment cuts from the sequester. The sequester’s 2 percentage point reduction for Medicare Part B land squarely on the add-on payment, effectively cutting it by a third and reducing payment from “ASP +6” to “ASP +4.” The President’s budget proposes to replace this existing cut with an even deeper one — reducing payment to “ASP +3 percent.”

These cuts are likely to exacerbate a dangerous trend. Since 2008, more than 1,200 community cancer clinics in the United States have closed, merged with hospitals, or reported financial difficulties. Here in California alone, 38 clinics have closed, merged or been acquired, and another 43 report that they are struggling financially — and that was before sequestration took effect.

Cuts are particularly damaging to California seniors in rural areas who may live an hour or more from the nearest hospital. For many of these seniors, access to cancer treatments in community clinics or physicians’ offices may very well be their only viable treatment option.

If more clinics close because of financial pressures, a growing number of seniors may need to seek treatment in more costly hospital settings and have to travel further distances to receive care. That’s a bad outcome for both seniors and taxpayers.

Just consider that between 2006 and 2011, overall health care costs in America went up by over 20 percent, while Part B drug costs stayed relatively stable thanks to cost containment from the “ASP +6%” formula.

Simply put, cuts to Medicare Part B are precipitating a public health crisis for senior citizens and the chronically ill, especially those who are particularly vulnerable or who live in rural areas.

And while the federal government certainly needs to get spending under control, making cuts to a program that has a good record of keeping costs down hardly seems like a sensible decision.

I urge Congress to make sure no further cuts to Part B covered medicines are considered. Not only are cuts to this area of Medicare counterproductive to reducing health care costs and federal spending, it would cause a real hardship for sick seniors and chronically ill patients across the country.

Liz Gibson of Elk Grove receives chemotherapy every three weeks for breast cancer that has metastasized to her bones and liver.

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