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The U.S. Centers for Medicare and Medicaid Services (CMS) on Wednesday said it has finalized a decision to cover expensive cancer cell therapies sold by Gilead Sciences Inc and Novartis AG. CMS, which runs Medicare - the federal government's health plan for Americans 65 and older - said it will cover the U.S. Food and Drug Administration-approved therapies when provided in healthcare facilities that have programs in place to track patient outcomes. (Beasley, 8/8)

Officials said Medicare will cover CAR-T cell therapies for certain types of lymphoma and leukemia , uses that are approved by the Food and Drug Administration. The cost can run to hundreds of thousands of dollars per patient, not counting hospitalization and other expenses. Medicare Administrator Seema Verma said the decision will provide consistent and predictable access nationwide, opening up treatment options for some patients “who had nowhere else to turn.” (Alonso-Zaldivar, 8/7)

In announcing the decision, Seema Verma, administrator of the Centers for Medicare and Medicaid Services, said that until now, Medicare’s regional administrators had decided whether to cover the treatment, which led to confusion. Verma said the agency, which had scheduled this coverage decision originally for late May, has been struggling to figure out how to cover and pay for the treatment, called CAR T-cell therapy. The treatment costs $375,000 or $475,000, depending on whether it is used for advanced lymphoma or pediatric leukemia. Hospital stays can add hundreds of thousands of dollars to the cost of care. (McGinley, 8/7)

The treatments provide new options for the cancer patients. Yet their use has been limited, in part because hospitals aren’t always sure they could get reimbursed for both the cost of the drugs and the lengthy hospital stays for side effects and other care that are often required. The problem was that health-insurance payments aren’t structured for treatments like a CAR-T, which trigger not just the price of the drug itself but related care costs that can reach hundreds of thousands of dollars. Novartis listed Kymriah for $475,000, while Gilead priced Yescarta at $373,000. (Rockoff, 8/7)

CMS hasn’t yet set a price that it will pay for the treatments, and instead will cover 65% of a hospital’s costs, Verma said. They can also apply for an additional outlier payment, offered for some new breakthrough therapies that have steep price tags. Between the two payments, some hospitals are getting close to the average sales price of the drug, she said. (Cortez, 8/7)

The agency also abandoned its previous idea of requiring hospitals collect data on how patients fare when they receive these treatments. Wednesday’s announcement does not, however, ensure that hospitals are breaking even when offering CAR-T treatments. CMS’ coverage policy does not change how much CMS reimburses for CAR-T treatments, which currently cost over $300,000. The agency has been “struggling” to set those payment rates, and it could be years before that issue is solved, Verma told STAT in an interview earlier this week. (Florko, 8/7)

Congress this year could enact the biggest overhaul of Medicare’s prescription drug benefit since it was first established in 2003. If successful, seniors — and taxpayers — would be more insulated against the cost of the most expensive drugs.  One proposed change is meant to help Medicare control the costs it absorbs so that the program’s premiums can remain stable despite increasing drug prices. Supporters of the drug program tout its low premiums, with the Trump administration and the private insurers who run Part D recently highlighting that average consumer premiums will fall in 2020. (Siddons, 8/8)