Submission to Senate Community Affairs Committee. Out-of-pocket costs in Australian healthcare. 12 May 2014

Transcription

1 Submission to Senate Community Affairs Committee Out-of-pocket costs in Australian healthcare 12 May mtaa.org.au Medical technology for a healthier Australia

2 Executive Summary The Medical Technology Association of Australia (MTAA) strongly supports the need to lessen the burden of consumers out-of-pocket costs for healthcare. Out-of-pocket costs can impede patients access to life saving or life changing medical technology. However private patients are not always well served by private health insurance funds in circumstances where surgical medical technology is not included on the federal government s mandatory reimbursement list known as the Prostheses List. Most health funds do not routinely reimburse non-implantable medical technology used in surgery. The outcome of requests by healthcare providers for ex-gratia payments to cover these items is erratic and can be unpredictable. As a consequence, many hospital providers have either ceased or limited performing affected procedures and privately insured patients are not receiving the health benefits of these technologies. MTAA asserts that surgical technology chosen by a consumer s physician on the basis of clinical need should in the first instance be entirely reimbursed by the patient s health fund. Failing that, the consumer should have the prerogative to elect to pay an out-of-pocket payment to cover the cost of provision of all or part of the medical technology. Where health funds and private hospitals have a contractual arrangement, the terms of the contract will most often prevent the hospital from charging patient co-payments for therapeutic procedures or any related services (i.e. accommodation, theatre fees and medical technology). The same contract will also require confidentiality of private hospitals data on such problematic matters which transparency would otherwise reveal to its full extent. MTAA wishes to reflect on Term of Reference f, role of private health insurance, of the Community Affairs Reference committee inquiry into out-of-pocket costs in Australian healthcare and recommends that: health funds be required to reimburse clinically appropriate, non-implantable, medical technology used in surgery; and health funds be prohibited from preventing consumers exercising their prerogative to choose a co-payment in the event that their clinical needs are not met by their private health insurer. 2

3 Level 12, 54 Miller St, North Sydney NSW 2060 Australia PO Box 2016 North Sydney NSW 2059 Australia P (+612) F (+612) E reception@mtaa.org.au 1. About the Medical Technology Association of Australia (MTAA) MTAA represents the manufacturers, exporters and suppliers of medical technology products in Australia. MTAA member companies account for the majority of products listed on the Australian Register of Therapeutic Goods (ARTG) and approximately 70% of the higher risk implantable medical devices listed on the Prostheses List and used in the Australian marketplace. The member companies cover the spectrum of the industry in Australia, from subsidiaries of major multinational medical technology companies, to independent distributors and small to medium sized Australian innovator companies. 2. Reimbursement of surgically implanted prostheses In 1985, the federal government introduced a reimbursement scheme, then called Schedule 5 in response to demands by a number of NSW orthopaedic surgeons led by Dr Bruce Shepherd, that health funds provide access to clinically necessary orthopaedic joints. In 2005 this became the Prostheses List (PL) which mandated both the products to be reimbursed and the dollar amount of reimbursement. The PL does not cover non-implantable medical technology. The listing criteria is at Enclosure 1. To be included on the PL, sponsors of prostheses must provide clinical evidence which is reviewed for suitability by experienced physicians. This process is in addition to requirements of the Therapeutic Goods Administration for product use within Australia. The benefit payable for reimbursement of listed products is determined by the Minister for Health or his delegate based on recommendations from the Prostheses List Advisory Committee. There is no legal obligation on medical technology companies to sell PL listed items at a price equivalent to the listed benefit amount but due to prevailing circumstances, it is problematic for suppliers to sell at a price above the promulgated reimbursement level. This results in very few privately insured consumers paying out-of-pocket costs for their surgically implanted prostheses. 3. Access to medical technology not listed on the Prostheses List Due to the Hospital Purchaser Provider Agreement (HPPA ) contractual restrictions that private hospitals operate within, medical technology not included on the PL may not be reimbursed by insurance fund. Health fund contractual arrangements will cover accommodation and theatre fees but coverage of non-implantable medical technology used in surgical procedures is problematic. Health funds may claim that case payments already include and cover the cost of additional medical technology but this is a contentious area. The final determination of coverage will rest with the 3

4 hospital so in the event that the product is not covered by the health fund, and its contractual relationship prevents passing on the cost to the patient, it has the choice of absorbing the additional cost or not providing the procedure. Anecdotal reports indicate that it is a frequent problem and getting worse. Failure by health funds to cover medical technology not listed on the PL has also led to cost-shifting to the public sector. 4. Examples of technology not routinely reimbursed by health funds MTAA would like to cite three examples of proven technology which is not routinely reimbursed by health funds leading to variable access by consumers: Pressure wires Drug eluting balloons; and Ablation catheters. 4.1 The Pressure Wire Procedure Fractional Flow Reserve (FFR) guided Percutaneous Coronary Intervention (PCI) FFR measured with a Pressure Wire during angiography measures blood flow in diseased coronary arteries and determines where coronary stents should be placed. It has been demonstrated that 30% of stents are unnecessary and that better outcomes are achieved with fewer stents. See Enclosure 2 for further data to the effect that this is a clinically and cost effective procedure which provides clinical benefits to appropriate patients and financial benefits to their health funds, yet inexplicably not all health funds provide reimbursement. 4.2 Drug eluting balloon (DEB) The drug eluting balloon is a balloon catheter for percutaneous transluminal coronary angioplasty. The balloon is coated with the antimitotic drug paclitaxel, with the aim of reducing restenosis. When the balloon is expanded, paclitaxel is released into the vessel wall. Using paclitaxel reduces restenosis and recurrence of symptoms. The UK s National Institute for Health and Clinical Excellence has provided a report on this technology which is at Attachment 1. NICE reports that: Hospital teams may want to use the SeQuent Please drug-coated balloon catheter as the evidence showed that it reduces restenosis of the coronary arteries more than drug-coated stent. It also reduces the need for further treatments and procedures to treat restenosis. 1 In circumstances where a DEB is indicated in lieu of a drug eluting stent (DES), direct and immediate cost savings are possible as the list price of the Sequent Please DEB is $1,800 whereas the PL benefit of a DES is $A3,450. There are also follow-on pharmaceutical savings in that only one month of Dual Anti Platelet (DAPT) Coverage 2 is indicated for patients receiving a DEB whereas 24 months coverage is required in respect of DES. Despite these potential health fund and PBS savings, inexplicably not all health funds provide DEB reimbursement. 1 See 2 Post procedure Dual Antiplatelet Therapy, DAPT (Clopidogrel) is listed at dispensed price maximum quantity (DPMQ) cost of $A54.96 per month 4

5 4.3 Ablation catheters The Electrophysiology and Pacing Council of the Cardiac Society of Australia and New Zealand have stated that: Atrial Fibrillation (AF) is a common sustained cardiac arrhythmia. It is estimated that approximately 165,000 Australians have AF. It is an irregular and rapid electrical activity of the atrium and can be associated with dizziness, chest pain and shortness of breath. It causes disability and decreased quality of life due to decreased cardiac output. Some patients may be unable to work. It is associated with frequent hospitalisations and increased morbidity due to an increased risk of heart failure and stroke. In 2006/2007 there were admissions into Australian hospitals with a principal diagnosis of AF. Prior to the development of radiofrequency ablation (RFA) techniques the only available treatment was anti-arrhythmic drugs and anticoagulants to prevent clot formation and possible stroke. This treatment is not curative and is a life long requirement. In up to 50% of patients AF will recur within 2 years despite drug therapy. RFA is a curative minimally invasive procedure where catheters are introduced into the heart via the femoral vein. 3D imagery is used to facilitate the ablation. Radio frequency energy is delivered via the catheters to destroy the cardiac tissue that is responsible for the arrhythmia and the catheters are then removed. Studies show that up to 83% of patients are free of AF at one year following ablation. Once a patient has been free of AF for six months drug therapy is usually no longer necessary. The Expert Consensus Statement of the Heart Rhythm Society supports the use of ablation as the treatment of choice if anti-arrhythmic drugs are unsatisfactory. 3 The Cardiac Society of Australia and New Zealand Position Statement on Atrial Fibrillation Ablation: supports catheter ablation in selected patients as a Class 1 indication for paroxysmal atrial fibrillation and a Class 2A indication for more persistent forms. This is in accordance with most recent European and American guidelines and is supported in the Australasian environment by two recent papers endorsed by the CSANZ. Currently there is significant inequity of access to these procedures and the CSANZ supports calls to redress this imbalance to ensure all patients have access to best practice. 4 An article on member services on the Medibank Private website also appears to accept the benefits of catheter ablation: Atrial fibrillation in itself is not dangerous; it can increase the risk of other problems, like stroke. If AF can't be controlled with medication, catheter ablation may be performed This destroys the cells that may be causing the atrial fibrillation, and allows the heart to beat in a normal rhythm. 5 3 Submission by the Electrophysiology and Pacing Council of the Cardiac Society of Australia and New Zealand to the 2009 Review of Health Technology Assessment in Australia see Attachment 2. 4 The Cardiac Society of Australia and New Zealand - Position Statement on Atrial Fibrillation see Attachment 3. 5 Medibank Private website member services - coverage of ablation cathetorisation see Attachment 4 5

6 Whilst on the one hand commending the curative effects of catheter ablation, Medibank Private in correspondence to hospitals has advised that from 31 August 2013 it would no longer approve ex-gratia payments for cardiac disposables. Informed stakeholders would interpret this to mean that non-implantable medical technology such as the technologies referred to above will not be reimbursed through ex-gratia payments. 4.3 Example of a hospital s coverage of cardiac procedures involving nonimplantable medical technology MTAA acknowledges the difficult position of hospitals constrained by confidentiality arrangements with health funds and their conflicting desire to see the removal of inequitable restrictions to clinically necessary technology. A de-identified summary of one hospital s relationship 6 with six health funds is shown at Table 1 below and demonstrates the variability of access by patients to cardiac technology. Table 1. Example of a hospital s coverage of cardiac procedures involving non-implantable medical technology Fund Ex-Gratia Process Electrophysiolo gy Drug Eluting Others Listed Pressur e % Approve Patient Co Payment A Yes Yes No Yes Yes Varies Yes B Yes Yes No Yes Yes 100% N/A C No Yes No No No 75% No D No No No No No Nil No E Yes Yes yes yes Yes 100% N/A F Yes Yes No No No 75% No Key to columns: Ex-Gratia process whether the fund has a process to obtain an ex-gratia payment % Approved is the % that the fund will pay of the purchase price Patient co-payment if the fund allows the hospital to charge the patient for all or a portion of the purchase price 4 Conclusion MTAA believes that the uncertainty surrounding access to cardiac technologies detracts from the value proposition of private health insurance coverage to patients. Manufacturers of medical technologies can supply non-implantable innovative technologies to patients that provide better health outcomes but due to the limitations of the criteria, may not qualify for formal reimbursement through the Prostheses List. MTAA s members are prepared to present these items for health technology assessment in the same manner as items on the PL to ensure that only clinically effective and cost-effective medical technology is mandated for reimbursement. 6 The health care provider requests anonymity. 6

7 In the first instance MTAA believes that health funds should meet their implied responsibilities to their members/consumers and provide routine reimbursement for clinically necessary non-implantable medical technology used in surgery but failing that, consumers must be permitted the prerogative to pay for these technologies themselves in whole or in part, should they elect to do so. Enclosures: 1. Criteria for listing on the Prostheses List 2. Pressure wire Attachments: 1. NICE medical technology guidance 1 SeQuent Please balloon catheter for instent coronary restenosis 2. Submission by the Electrophysiology and Pacing Council of the Cardiac Society of Australia and New Zealand to the Review of Health Technology Assessment in Australia 3. The Cardiac Society of Australia and New Zealand - Position Statement on Atrial Fibrillation 4. Medibank Private website member services - coverage of ablation cathetorisation 7

8 Criteria for listing on the Prostheses List 7 Enclosure 1 Products meeting all of the following criteria are eligible for consideration for inclusion on the Prostheses List: 1. The product must be included on the Australian Register of Therapeutic Goods; and 2. The product must be provided to a person as part of an episode of hospital treatment or hospital-substitute treatment; and 3. A Medicare benefit must be payable in respect of the professional service associated with the provision of the product (or the provision of the product is associated with podiatric treatment by an accredited podiatrist); and 4. The product should: (a) be surgically implanted in the patient and be purposely designed in order to: (i) replace an anatomical body part; or (ii) combat a pathological process; or (iii) modulate a physiological process; or (b) be essential to and specifically designed as an integral single-use aid for implanting a product, described in (a) (i), (ii) or (iii) above, which is only suitable for use with the patient in whom that product is implanted; or (c) be critical to the continuing function of the surgically implanted product to achieve (i), (ii) or (iii) above and which is only suitable for use by the patient in whom that product is implanted; and 5. The product has been compared to alternate products on the Prostheses List or alternate treatments and: (i) assessed as being, at least, of similar clinical effectiveness; and (ii) the cost of the product is relative to its clinical effectiveness. 7 DoH PL Guide see p14 F C5/$File/plguidept1Oct10.pdf 8

9 Introduction Pressure Wire Enclosure 2 The example of the St Jude Medical Pressure Wire illustrates how a less expensive and comparatively more effective procedure is very often not delivered to private patients as a result of its exclusion from the Prostheses List due to restrictive criteria. The Pressure Wire Procedure Fractional Flow Reserve (FFR) guided Percutaneous Coronary Intervention (PCI) FFR measured with a Pressure Wire during angiography measures blood flow in diseased coronary arteries and determines where coronary stents should be placed. It has been demonstrated that 30% of stents are unnecessary and that better outcomes are achieved with fewer stents This is supported by 16 years of clinical evidence i ii iii - however pressure wires are under-utilised in private hospitals in Australia. By contrast, uptake in the public sector is much higher. The FAME Trial iv Compared FFR guided PCI to Angiography guided PCI in multi-centre RCT 2 year results 30% reduction in the use of stents Reduction of death and heart attack (combined) by 34%. Reduction of heart attack alone by 37% Lesions that were deferred from stenting on the basis of FFR measurement showed only a 0.2% incidence of causing a heart attack Economic Evidence A cost-effectiveness analysis (CEA) and a public health and budget impact analysis of FFR guided PCI versus PCI guided by angiography alone in multi-vessel patients in Australia was conducted in 2012 v. Results FFR guided PCI was found to be cost saving in 78% of cases FFR guided PCI was found to be cost effective in greater than 99% of cases assuming a willingness to pay of $50,000 per Quality Adjusted Life Year (QALY) The cost of the initial procedure was reduced by $974 on average Overall cost was reduced by $1812 on average Potential savings to payers if Australian practice followed evidence from the FAME trial: Private Sector - $23,000,000 Public Sector - $27,000,000 At present uptake of FFR, 65 deaths, 154 heart attacks, 268 major adverse cardiac events, 91 PCIs and 76 bypass surgeries are avoided These numbers would increase proportionally if FFR uptake was increased. Implications The FAME trial demonstrated that, overall, 30% of stents are unnecessary. Stents are included on the Prostheses List and a hospital is financially indifferent to how many stents are used. Health insurers must pay a benefit of $3450 for each drug eluting stent (DES). The St Jude Medical Pressure Wire costs $1360 and is not 9

10 included on the Prostheses List and in most cases is an additional cost to the hospital. A pressure wire when indicated will, on average, be cost saving to a health fund; however in a majority of cases health funds choose not to pay a benefit. Some health insurers will pay a benefit but often only if a request is made several days prior to the procedure. However this is inconsistent, impractical, and varies between insurers and between patients in different hospitals but covered by the same insurer. An equity issue exists as purchasers of private insurance have no visibility of decisions of this nature and have no ability to compare insurance products on this basis. In fact private health insurance members may purchase identical products but one member will have access to a pressure wire in a specific hospital whereas another member will not if admitted to a different hospital. Copyright 2014 Medical Technology Association of Australia Limited (MTAA) To the extent permitted by law, all rights are reserved and no part of this publication covered by copyright may be reproduced or copied in any form or by any means except with the written permission of MTAA Limited. i Pijls NHJ et al Measurement of Fractional Flow Reserve to assess the Functional Severity of Coronary Artery Stenoses New Eng J Med 334: (1996) ii De Bruyne B et al Fractional Flow Reserve-Guided PCI versus Medical Therapy in Stable Coronary Disease New Eng J Med 2012; 367: iii Tonino PA et al Fractional Flow Reserve versus Angiography for guiding percutaneous coronary intervention New Eng J Med 2009; 360: (2009) iv Pijls NHJ et al Fractional Flow Reserve Versus Angiography for Guiding Percutaneous Coronary Intervention in Patients With Multivessel Coronary Artery Disease: 2-Year Follow-Up of the FAME(Fractional Flow Reserve Versus Angiography for Multivessel Evaluation) Study Journ. Am. Coll. Card. Published online May 26, 2010 v Siebert U FFR-Guided PCI in Multi-vessel Patients Australian Economic Sub-Analysis and Health/Budget Impact Analysis of the FAME Trial St Jude Medical Breakfast Session, 6 th Annual ANZET Meeting, Convention Centre, Brisbane Australia 10