The proposed rule would raise its maximum add-on payment for new technology from 50 percent of estimated costs to 65 percent. This would increase reimbursement to hospitals administering the treatment to $242,450 from the current $186,500.
While it is a step in the right direction, the new payment increase wouldn’t cover the full cost of the treatment. The list prices for the two CAR-T therapies on the market — Gilead Sciences’ Yescarta and Novartis AG’s Kymriah — have price tags of $373,000 and $475,000, respectively.
Beyond just the list price of the drug, the costs of administering CAR-T can increase to more than $1 million because patients almost always are admitted to a hospital for CAR-T treatment because of the risk of life-threatening side effects. Medicare last year said it would pay its standard mark-up rate for CAR-Ts on an outpatient basis.
Medicare currently reimburses hospitals for CAR-T under a code for bone marrow transplants that doesn’t cover actual costs. CMS is proposing adding a new billing code for CAR-T cell therapy procedures.
CMS is seeking comment on the potential rule. The earliest it would take effect is in October.
CAR-T therapy, which uses patients’ genetically modified immune cells to fight cancer, has emerged as a promising new cancer treatment, but it has also left hospitals grappling with financial uncertainty as Medicare works to establish a more permanent payment plan.
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