SEQUESTRATION CAUSING MEDICARE COST INCREASES THREATENING SENIOR'S CANCER CARE

The Community Oncology Alliance (COA), a non-profit organization dedicated to preserving and fostering community cancer care, announced today the results of a national survey of oncology providers on the impact of the sequester cut to Medicare payments for cancer drugs and services that took effect April 1, 2013.  This survey revealed that the 2% sequester cut has inordinately impacted community oncology practices because it is a payment cut to the underlying cost of cancer drugs. This cut places many of these drugs “under water” — meaning that the reimbursement by Medicare is less than the purchase price of the drug.

 The majority of cancer patients are treated in office-based community oncology practices, where 69% of practices surveyed reported that patient treatment and/or operational changes already have been made due to the sequester cut to cancer drugs. These changes include:

 · 49% of practices forced to send Medicare patients elsewhere for treatment
 · 62% of practices reported they will be forced to send Medicare patients elsewhere for treatment if the sequester cut stays in place through July 31, 2013 · 21% of practices reported they are laying off staff
 · 38% of practices expect to lay off staff if the sequester cut remains in place through July 31, 2013 · 14% of practices report opening or resuming discussions with hospitals to be acquired or form a professional service agreement
 · 20% of practices will open or resume such discussions if the sequester cut remains in place through July 31, 2103 

 Based on the survey, and a study conducted by Milliman, an independent actuarial and consulting firm, on the cost differential between cancer care delivered in the practice versus hospital setting, the sequester cut will cost Medicare, and add to the deficit, an estimated $450-600 million annualized due to the shift to the more expensive hospital setting. This estimate does not include the increased cost to seniors when their treatment is provided in the hospital setting.

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