Oral Chemotherapy law to open access for more patients Kentucky s new law takes effect January 2015

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1 For Immediate Release For more information, contact Scott Sisco Oral Chemotherapy law to open access for more patients Kentucky s new law takes effect January 2015 FRANKFORT, Ky., Nov. 11, 2014 As of Jan. 1, 2015, many Kentucky cancer patients will benefit from the state s new Oral Chemotherapy Parity Bill, which passed the Kentucky Legislature in the 2014 session. Intravenous (IV)/infused anticancer medications are typically covered under a health plan's medical benefit, with patients responsible for a nominal copayment, per treatment. Orally-administered anticancer medications, however, are usually covered under a health plan's pharmacy benefit. Under the pharmacy benefit, oral anticancer medications are often included in the highest tier of a health plan s drug benefit and come with the highest out-of-pocket cost, requiring patients to pay a coinsurance or a percentage of the overall total cost of the drug. This percentage coinsurance can often equal thousands of dollars each month; a price tag that restricts access to life-saving oral anticancer therapies for untold numbers of cancer patients. On January 1, this will change for cancer patients in Kentucky, when KAR Chapter 304, as amended, goes into effect, giving patients greater access to the latest and most effective anticancer treatments. The bill, which passed at the end of the 2014 legislative session after a hard fought battle by the Kentucky Pharmacists Association, patients, patient advocacy organizations and Senator Tom Buford, limits how much health insurance companies can charge patients to no more than $100 out-of-pocket for a 30-day supply of orally administered anticancer medications. The original bill was sponsored by Sen. Buford and overwhelmingly passed both houses of the state legislature. This legislation was added to HB 126 and was signed into law by Governor Steve Beshear in April. We are proud to have been a part of the successful outcome of this important legislation needed by cancer patients, stated KPhA President Bob Oakley. Improving access to one s medication therapy by controlling out of pocket costs will increase adherence and be positive for the patient overall. The law does not require health plans to cover a new service and only impacts those that currently list chemotherapy as a covered benefit. The state law impacts residents covered by a private commercial health plan. The law does not impact the federal Medicare program. Kentucky joins 33 other states and the District of Columbia, including Missouri, Wisconsin and Ohio, in enacting similar legislation. For more information about KAR Chapter 304/HB126, please visit: Since 1879, the Kentucky Pharmacists Association has served Kentucky pharmacists in all practice settings by promoting the profession of pharmacy, enhancing the practice standards of the profession, and demonstrating the value of pharmacist services within the health care system. -30-

2 The Kentucky Pharmacists Association is the largest professional organization representing pharmacists in the Commonwealth and has been serving its members since KPhA is the voice of pharmacists from all practice settings concerning education, policy, legislative, and regulatory matters to shape and improve the future of healthcare across Kentucky and the United States. The voices of democracy speak loudly, especially when many voices join together. The Kentucky Pharmacists Association offers its members the opportunity to band together with like-minded voices to be heard. By uniting members for a single cause, KPhA can benefit pharmacists in all practice settings. We also alert our members on rapidly changing healthcare issues via multiple technologies, publications and educational seminars. Throughout its history, the Kentucky Pharmacists Association has maintained a positive and respected position in the Commonwealth's political arena. To Kentucky legislators and Kentucky executive branch officials, KPhA is the voice of pharmacy concerning legislative and regulatory matters. We are affected by the decisions of government officials, insurance companies, the Board of Pharmacy, and elected officials. Maintaining KPhA's presence in the Capitol is a high priority for the association. Political advocacy for the profession of pharmacy is vital to preserve a favorable and progressive environment for the practice of pharmacy in the Commonwealth. We believe protecting and serving pharmacists is the most important function of KPhA US 127 South * Frankfort, KY *

3 NEW LEGISLATION TO BENEFIT CANCER PATIENTS KRS Chapter 304 was amended by the General Assembly to include parity for oral chemotherapy treatment and will go into effect in Kentucky on January 1, Starting January 1, 2015 Kentucky law will limit what cancer patients, taking oral anticancer medications, have to pay each month to $100 for one thirty day treatment period. For countless patients this means a saving of thousands of dollars & increased access to the most effective therapies to treat their cancer. Kentucky Insurance Law now Limits Patient Out-of-Pocket Costs for Oral Anticancer Therapies Not a Mandate Kentucky's new law does not require insurers to provide a new benefit for cancer patients; it simply directs health plans in Kentucky who currently cover cancer treatments to limit what patients taking oral anticancer medications pay each month to $100 per thirty day treatment period. KRS Chapter 304 Change Will Not Greatly Increase Premiums for All Based on a study by Milliman, an independent actuarial consulting firm, new laws to limit patient out-ofpocket for oral anticancer will only minimally increase health insurance premiums. Specifically, the study showed an average increase of only $0.50 per member per month for most plans. This translates to a mere 0.17% increase in premiums (a typical plan within this context costs over $300 per member per month). [1] Moreover, fiscal impact studies conducted in states like Kentucky, Indiana, Missouri and a host of others, where legislation has passed, showed similar results. Flawed Benefit Design to Blame for Gap in Out-of-Pocket The disparity in patient out-of-pocket exists because coverage for an IV/injected drug is listed under a plan s medical benefit, which requires a fixed copay of $25-$50 per treatment, depending on the plan. Conversely, oral anticancer therapies are typically covered by a plan s pharmacy benefit and involve patient out-of-pocket costs ranging from hundreds to thousands of dollars per month. HB 126 amended KRS Chapter 304 to fix that. Out-of-Pocket Costs Impact Patient Compliance with Treatment Plan A study in the Journal of Managed Care Pharmacy found that patients whose monthly costs were greater than $200, for one prescription, were at least three times more likely to not fill their prescription for their oral anticancer drugs, compared to patients with out-of-pocket costs of $100 or less. Abandoning one s medication may lead to costly follow-up visits or hospitalization, among other issues. 1 Fair access to oral drugs can help prevent this outcome. Oral Anticancer Therapies Are Wave of the Future As many as 30% of new anticancer treatments in the research pipeline are in oral form, making oral therapies an increasingly important component of cancer treatment. In fact oral anticancer medications are already the standard of care for a range of cancers. Legislation to Limit Patient Costs Sweeping the States Kentucky proudly joins 34 states and the District of Columbia in enacting legislation that makes oral anticancer medications affordable for patients whose physician deems them the most effective therapies to treat their cancer. [1] Milliman, Inc. Parity for Oral and Intravenous/Injected Cancer Drugs. January Gleason PP, et al. Oral Oncology Prescription Abandonment Association with High Out-of-Pocket Member Expense. Journal of Managed Care Pharmacy, 16:

4 ORAL ONCOLOGY PARITY LAWS The way we treat cancer is changing with oral anti-cancer medications playing an increasingly important role. These therapies available in pill form directly attack cancer cells, often with fewer side effects. Oral oncology parity laws can assist patients in accessing these new innovative therapies. As of June 2014, 34 states and the District of Columbia have passed these laws. Is your state one of them? WHAT IS ORAL ONCOLOGY PARITY? Traditional anti-cancer medications are primarily administered intravenously and covered under a health plan s medical benefit, often requiring patients to pay a minimal co-pay or no cost at all for the medication. Oral anti-cancer medications are usually part of the health plan s pharmacy benefit, often resulting in high, burdensome out-of-pocket costs through coinsurance (requiring patients to pay a percentage of the overall cost of the prescription therapy). This disparity negatively impacts patient adherence 1 and forces physicians to make decisions based on outdated health plan benefit designs rather than what is best for the patient. 2 WHAT DO ORAL ONCOLOGY PARITY LAWS DO? Oral oncology parity laws are intended to address this problem of inequitable coverage between oral and IV anti-cancer medications by requiring health plans to equalize a patient s out-of-pocket costs between oral and IV therapies. The laws do not mandate coverage of oral chemotherapy, but simply state that if a health plan covers chemotherapy treatment, the patients out-of-pocket costs must be the same, regardless of how the therapy is administered.

5 WHO BENEFITS FROM THESE LAWS? As of June 2014, 34 states and the District of Columbia (DC) have passed legislation to limit patient out-of-pocket costs for oral anti-cancer medications and a number of others are expected to take action in However, state laws can only impact certain health plans and do not apply to Medicare or Medicaid. Health plans covered under the federal Employee Retirement Income Security Act (ERISA) (usually large, multi-state health plans) are also exempt. Since state laws can only protect a portion of cancer patients, a federal bill like the Cancer Drug Coverage Parity Act is important to fill the gaps. Oral oncology parity laws allow many patients and physicians to choose the right therapy that offers the most hope---without worrying about outdated health plan benefit designs that charge patients more simply because the therapy they need is only available in pill form. It is estimated that 25-35% of the therapies in the oncology pipeline will only be available in pill form. 3 These laws ensure that patients fighting cancer today and those who will be diagnosed in the future have access to the innovative therapies offering them the best chance at survival. An increasing number of state legislatures have taken steps to ensure patients have equal access to oral anti-cancer therapies. In addition to the 34 states and the District of Columbia that have passed oral oncology parity laws, there is a federal bill, the Cancer Drug Coverage Parity Act, that has been introduced in Congress. Where can I go for more information or to learn about the law in my state? Visit the State Patients Equal Access Coalition website at for more information on the important role Oral Oncology Parity laws play and to download state-specific fact sheets on all the existing state laws. For more information on efforts to pass a federal bill ensuring oral oncology parity, please visit 1 Streeter, SB, Schwartzberg, L. and Johnsrud, M. Patient and Plan Characteristics Affecting Abandonment of Oral Oncolytic Prescriptions. Journal of Oncology Practice, 7.3S 46s-51s. 2 Neumann, PJ et al. Cancer Therapy Costs Influence Treatment: A National Survey of Oncologists. Health Affairs, 29, no. 1 (2010): Geynisman, DM and Wickersham, KE. Adherence to Targeted Oral Anticancer Medications. Discovery Medicine, 2014: 17, no. 095