Introduction

Federal and state governments play critical roles in establishing policies that shape and fund virtually every aspect of cancer care and research throughout the United States. Although federal health care reform legislation—the Affordable Care Act (ACA)¹—has attracted headlines for several years, such high-profile legislation is just one aspect of cancer policy. Many important policies arise with much less fanfare. Examples include policies adopted by the National Cancer Institute (NCI) to guide funding of research proposals, national coverage determinations for Medicare promulgated by the Centers for Medicare & Medicaid Services (CMS), and policies established by the U.S. Food and Drug Administration (FDA) regarding products used for the prevention, diagnosis, and treatment of cancer.

For the foreseeable future, cancer policy initiatives must be forged in a political environment beset by extreme financial pressure. Potential cuts in reimbursement and funding will remain an ongoing threat, raising the stakes for efforts to advocate for policies that protect and promote the needs of persons with cancer, the cancer research enterprise, and oncology professionals.

As the modalities and therapies available to diagnose and treat cancer have become more successful and more complex, the administrative burdens and financial constraints placed on all cancer care specialists have become more extreme. Perhaps more than at any other time, policy issues confronting the cancer community are most properly viewed as affecting the oncology community as a whole rather than any individual segment. The fates of community-based, hospital-based, and university-based cancer care providers and researchers are increasingly intimately linked in ways that may not be transparent to the casual observer.

This chapter does not catalogue every policy initiative that affects the cancer community. Rather, the following discussion provides a framework for understanding the important roles that federal and state governments play in regulating, shaping, and funding the oncology care delivery system and research enterprise.

The roles played by federal and state policy makers in cancer can be divided into the following primary functions:

Background

Multiple areas of authority and discretion are relevant to cancer policy development within federal and state governments. The three branches of government—the legislature, the executive branch, and the courts—each play distinct roles in a carefully constructed system of checks and balances. Although the Supreme Court’s review of the ACA during 2012 provides a notable example of the interplay between these branches of government, most cancer policies do not involve litigation.

The Supreme Court considered the constitutionality of two major provisions of the ACA—the individual mandate (a requirement that individuals maintain a minimum level of health care insurance for themselves and their tax dependents) and the ACA’s requirements for states to expand their Medicaid programs. Architects of the ACA relied heavily on Medicaid as a vehicle for expanding coverage to the uninsured. In June 2012, the Supreme Court upheld the individual mandate but did so by defining it as a tax. The court struck down the ACA’s requirement for states to expand their Medicaid programs.³

Medicaid funding and oversight is a shared responsibility between states and the federal government, and political leaders in many states have indicated an initial unwillingness to engage in any significant expansion of their Medicaid programs. From the perspective of oncology patients and providers, the issue of Medicaid expansion remains complicated. Although any form of coverage may appear preferable to being uninsured, the coverage for cancer care under most Medicaid programs is grossly inadequate, and some studies indicate that cancer outcomes are not significantly better for Medicaid patients in comparison with the uninsured.6–6

Although some provisions of the ACA will remain highly controversial, a number of relatively noncontroversial provisions are particularly important for the cancer community. These provisions include protections for patient access to preventive screening for cancer; protections to help vulnerable individuals with cancer secure and retain access to health insurance; safeguards for individuals with cancer and other preexisting conditions; and protections for patient access to clinical trials.7,8 The political debate over the ACA is certain to continue for many years, and these patient safeguards, which have bipartisan support, warrant the cancer community’s ongoing attention.

As with the ACA, cancer-related policies of significance at the federal level often arise from laws enacted by the U.S. Congress (Table 21-1). However, in virtually every law enacted by Congress, there are substantial gaps, conflicts, and ambiguities within the legislation that must be resolved as part of the implementation process. As a result, the work to influence the final version of a national policy involving cancer rarely ends with the enactment of legislation. Advocates for the cancer community must typically devote substantial attention to educate agency officials and influence policies adopted by agency officials under both new and preexisting legislative authority. These same dynamics also occur at the state level.

For policies relevant to the cancer community at the federal level, the discretion to identify and address the gaps, conflicts, and ambiguities in statutes rests with the executive branch, including the Office of the President and the U.S. Department of Health and Human Services. In practice, all but the most politically sensitive issues are typically determined by one of the agencies within the Department of Health and Human Services, including the NCI, the National Institutes of Health (NIH), CMS, the FDA, the Centers for Disease Control and Prevention, the Health Services and Research Administration, and the Agency for Healthcare Research and Quality.

These agencies are charged with providing the expertise to make effective policies in areas involving complex scientific and clinical issues. As a result, there often are a substantial number of agency employees who have scientific and clinical backgrounds, although other agency officials may have limited experience in these areas. In many instances, agency employees are left with lean staffing to contend with some of the most challenging issues facing the U.S. health care system. This situation heightens the importance of efforts by oncologists to share detailed, practical solutions with federal and state policy makers regarding the complex issues facing the cancer community and the health care system.

Research

The federal government plays an integral role in cancer research in the United States, including basic science research, translational research, and clinical trials. Although a number of federal agencies are active in supporting cancer research, the NCI (one of 27 NIH institutes and centers) is the primary agency charged with guiding and funding national research initiatives in oncology. Congress established NCI under the National Cancer Institute Act of 1937.⁹ Although subject to oversight by Congress and the Administration, NCI retains significant discretion to establish overarching policies and make case-by-case decisions that shape national research efforts.

Most of NCI’s funds are used to support extramural research activities in communities located throughout the United States, which often focus on important scientific questions that industry may have little incentive to explore (such as comparisons of competing drugs or drug regimens). NCI also supports intramural research conducted at NCI’s facilities in Maryland. From 1999 to 2003, NCI and NIH benefitted from strong patient advocacy and a concerted effort by Congress to double the NIH budget during this 5-year period. The NCI budget for fiscal year 2012 exceeded $5 billion.

Federal policy makers have recognized the importance of harnessing the economic benefits of cancer research and supporting the United States’ international leadership position in this field. For example, as part of the American Recovery and Reinvestment Act of 2009 (ARRA), Congress provided nearly $1.3 billion in additional funding to NCI for use during fiscal years 2009 and 2010.¹⁰ Congress required that NCI target the ARRA funding to preserve and create jobs, promote economic recovery, and increase economic efficiency through technological advances in science and health. The cancer community welcomed ARRA funding, despite the fact that the ARRA funds did not become part of the permanent baseline for the NCI and NIH budgets.

Although the national resources devoted to cancer research remain substantial, the nation is losing opportunities and efficiencies because of suboptimal funding. Despite the significant successes achieved in oncology research from the long-standing collaboration between the federal government and researchers throughout the country, the uncertainty and inconsistency in federal funding for NCI during recent years is taking a substantial toll. The aggregate funding levels for NCI and NIH have been relatively flat since the doubling of these budgets concluded in 2003 (Fig. 21-1). This stagnation has eroded the effective level of federal support for cancer research by more than 20% because of the rate of biomedical research inflation during the past decade.

At a time when other nations, including China, Russia, India, and several European countries, are implementing substantial increases in their national commitments to biomedical research and related economic growth, the United States is facing the prospects of potential cuts in cancer research funding levels. This environment of flat budgets and looming cuts is undermining and delaying realization of the significant scientific progress made during the past two decades. Without sustained and predictable increases in annual funding for NCI, significant efficiencies are being lost because important studies may be started but not completed, the awarding of multiyear research grants is compromised, and established research teams are destabilized. Oscillations in federal funding levels and uncertainty in the late 1980s and early 1990s have the potential to dissuade highly talented young people from pursuing careers in cancer research.

One issue of particular concern is the need to restructure and improve funding for the NCI Clinical Trials Cooperative Group Program. The Institute of Medicine published a report in 2010 recommending changes, and NCI is working to implement modifications designed to both streamline the research process and prioritize clinical trials with the most promise for improving patient outcomes.¹¹ Even with these changes, increases in NCI funding are needed to ensure that clinical trials can be conducted in a timely manner to translate recent scientific discoveries into benefits for day-to-day patient care. For example, the Institute of Medicine report recommends that NCI increase the payment rate for clinical trials because the current rate only accounts for one third to half of the actual costs incurred by providers conducting clinical trials. With current funding constraints, the NCI has said that, in order to implement such a recommendation, they would have to scale back plans for new trials or reduce accrual rates to existing studies.

The national commitment to cancer research has continued, even through challenging economic times, since Congress initially authorized NCI in 1937. However, the promise for new highly effective cancer therapies has never been brighter, and as a result, the need to amplify our commitment to ensure that adequate research funding exists has never been greater.

Patient Safeguards

The government develops safeguards to protect individuals from potential harms in the health care arena. There are many examples within the federal government of initiatives to create safeguards for patients with cancer through laws, regulations, and agency determinations. Two examples, the regulation of genetic testing products and the regulation of generic drugs and oncology drugs under shortage, illustrate this aspect of federal oversight.

Generics, Biosimilars, and Drug Shortages

One of the most challenging issues facing the oncology community is the issue of drug shortages. During the past few years, there has been a worsening trend in which critical and often curative anticancer drugs are suddenly becoming unavailable to patients in the United States (Fig. 21-2). These shortages of important cancer drugs are increasing daily, forcing oncologists to substitute less effective treatments in many instances. Frequently, these shortages result in unacceptable delays in treatment (particularly involving pediatric cancers), increased costs to patients with cancer and, in some instances, the denial of curative therapies. These developments are quite alarming.

In the vast majority of oncology drug shortages, a generic drug is involved. By many measures, the legislation and regulations that fostered the use of generic drugs have been a success. Since the enactment of the Drug Price Competition and Patent Term Restoration Act of 1984,¹⁴ the proportion of generic drugs used in the United States grew from less than 20% to nearly 75% over a 25-year period. By one estimate, the savings achieved for the United States health care system through the substitution of generic drugs were in excess of $1 trillion between 1999 and 2010.¹⁵

The seriousness of the drug shortages issue has attracted the attention of many policy makers in Washington, D.C. The FDA has been actively engaged in working to mitigate existing and developing shortages, and several members of Congress have introduced legislation to address this issue. President Obama signed an executive order on October 31, 2011, aimed at reducing drug shortages through such means as heightening reporting requirements for manufacturers in advance of foreseeable shortages.¹⁶ In 2012, Congress enacted legislation to help ameliorate drug shortages through a combination of manufacturing reporting requirements, direction for the FDA to reduce regulatory burdens, and means to otherwise address potential shortages.^16a

In oncology, most drug shortages affect generic injectable drugs. A small number of manufacturers appear to be producing these products, and faced with low profit margins, these companies may not be investing adequately in their production facilities and may be reducing carrying costs by limiting inventory. Some voices from the pharmaceutical industry have blamed the FDA for exacerbating the problems related to drug shortages, but there is widespread concern that expediting FDA inspections and making other changes in FDA processes will have only a minimal impact on this problem.

Under the ACA, Congress established authority for the approval of “biosimilars” (essentially generic forms of biologicals) by the FDA. It remains unclear whether the pharmaceutical industry will invest in the development of biosimilars to the same degree that the industry historically has invested in generic forms of traditional prescription drugs, which typically present lower costs and fewer technical challenges to develop and manufacture.

Health care professionals in oncology are not in a position to evaluate the economic and regulatory issues facing pharmaceutical companies that manufacture generic oncology drugs. However, they are well positioned to understand and describe the human suffering that is arising as a direct result of these drug shortages. As with many policy issues confronting the oncology community, oncologists and other health care professionals have been critical to educating the widest possible audience of federal policy makers about the adverse effects of this crisis.

Important protections and safeguards can also arise from state legislation; one important example is state oral parity legislation. Significant scientific advances in recent years have resulted in increasing opportunities to treat individuals with cancer with orally administered medications. This is not merely an issue of convenience for the patient or health care provider. In some instances, oral cancer drugs may represent the only treatment option. As health insurance products have evolved over time, some insurance plans impose significantly higher cost sharing requirements on cancer patients for oral cancer drugs covered under the outpatient prescription drug benefit compared with traditional intravenous cancer drugs covered under the medical benefit.

At least 20 jurisdictions (including 19 states and the District of Columbia) have enacted oral parity legislation.¹⁷ Although the laws vary from state to state, oral parity legislation generally is designed to create safeguards for the financial burdens faced by individuals with cancer that may result from excessive copayments, coinsurance, deductibles, or similar requirements. Under these laws, the patient’s cost sharing for oral anticancer medications typically is limited to no more than the level that would occur under an insurance plan’s policies for intravenous and injected anticancer drugs.

Although state oral parity laws do not address the overarching problems with the pricing of cancer drugs, these laws provide a tangible step that can be taken in the short-term to help alleviate the financial burdens placed on persons with cancer. In addition, these laws provide a model for the types of reform that can be pursued by the cancer community at the state and local levels. Templates for state legislation and related talking points can be obtained from the American Society of Clinical Oncology.

Health Care Insurance

Policies adopted by the Medicare program regarding prevention, diagnosis, and treatment of cancer have greatly influenced both the practice of oncology and the services available to both Medicare and non-Medicare patients throughout the United States. Medicare is a federal health insurance program that provides health care coverage to persons who satisfy eligibility requirements related to age or disability. The influence of the Medicare program is due in large part to the significant size of the program, which covers approximately 60% of all patients with cancer in the United States.² However, the influence of Medicare’s policies extends well beyond its patient population. Both public and private insurers often rely on coverage policies, reimbursement levels, and coding used by Medicare as a starting point for establishing their own policies.

Cancer care has changed dramatically since Congress initially created the Medicare program in 1965, and as Medicare has evolved, the program has played an important role in defining the modern practice of oncology. As the number of effective anticancer chemotherapy regimens grew in the 1980s and 1990s, Medicare’s coverage of intravenous drug therapies in outpatient settings enabled hospitals and physician practices to establish sophisticated, full-service facilities that serve patients with cancer within their local communities throughout the United States.

However, since the late 1990s Congress enacted changes in Medicare reimbursement levels for oncology drugs and professional services that have placed significant financial and administrative burdens on cancer care providers. For example, Congress enacted provisions to control the growth of spending on all physician services through the “sustainable growth rate” under the Balanced Budget Act of 1997,¹⁸ and this blunt budgetary instrument has required multiple interventions by policy makers over the years to address the flaws in this system.

Congress enacted provisions within the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (commonly referred to as the Medicare Modernization Act) that changed the reimbursement formula for oncology drugs administered in outpatient settings.¹⁹ Despite multiple steps taken by Congress and CMS to mitigate adverse effects on oncologists, the net effect of these changes over time has contributed to the financial challenges to provide optimal care faced by many oncology practices. Policy makers often justify the various forms of cuts in payments to oncologists and other physicians on the basis that health care providers can shift the financial burdens arising from Medicare’s underreimbursements to private-sector employers and insurers. This approach is problematic in general, but it is especially difficult for oncologists who must serve increasingly large numbers of elderly (i.e., Medicare) patients.

Congress enacted multiple safeguards over the years to protect persons with cancer. For example, Congress enacted provisions in 1993 requiring Medicare to cover off-label uses of drugs and biologicals if such uses were supported by clinical evidence reflected in the peer-reviewed medical literature or specific compendia.²⁰ This patient safeguard has been critically important during the past two decades because pharmaceutical companies are unlikely to seek FDA approval for multiple supplemental indications that support the most important therapeutic agents.

Congress enacted a number of changes to Medicare under the ACA, including the creation of a new center within Medicare called the Center for Medicare and Medicaid Innovation (the Innovation Center).¹ Congress vested broad authority in the Innovation Center to test and expand the use of innovative approaches to reimbursement under Medicare without the need for further action by Congress. In the future, the Innovation Center could test and implement new oncology payment models under this authority. As part of the ACA, Congress suggested but did not require that the Innovation Center conduct a treatment planning project. This demonstration would focus on cancer care and provide financial incentives for treatment planning and follow-up care planning in the context of cancer care guidelines.

Perhaps the most high-profile project involving the Innovation Center is the Medicare Shared Savings Program, which relies on the establishment of accountable care organizations (ACOs).¹ ACOs operate under the traditional fee-for-service rules for Medicare Part B. However, the Medicare program will share the savings achieved by ACOs if the aggregate costs incurred by Medicare for the ACO’s assigned Medicare beneficiaries falls below an established benchmark. ACOs are required to meet a minimum set of performance measures. In an attempt to avert the economic incentive that could exist for providers to undertreat patients, one of these measures would assess whether ACOs are permitting patients to access specialists, however there are no performance measures that provide any meaningful assessment of treatment for cancer. In general, Medicare beneficiaries have the autonomy to seek care from any physician at any time, and ACO physicians have no authority to limit the beneficiary from visiting other health care professionals (whether inside or outside of the ACO).

One can view the ACO program as the logical extension of a prior demonstration conducted by CMS. From 2005 to 2010, CMS conducted the Medicare Physician Group Practice Demonstration. Under this demonstration, CMS shared the savings achieved with the participating physician groups. CMS used performance measures focusing on diabetes, congestive heart failure, coronary artery disease, and preventive care. Several physician groups succeeded in sharing a portion of the cost savings achieved for the Medicare program.²¹

The ACA also includes a safeguard to ensure that persons with cancer and other life-threatening conditions are covered under private insurance if they determine with their physicians that enrolling in a clinical study is in their best interest.¹ The legislation requires insurers to cover the routine costs of care associated with qualifying phases I, II, III, and IV clinical trials. Ensuring that patients with cancer can access clinical trials is not solely focused on promoting research, because it is a long-standing and firmly held belief in oncology that the option to participate in a clinical trial is a key component of high-quality cancer care and should be a readily accessible option for any patient with cancer. In many instances, clinical trials provide persons with cancer with the best chance for a successful outcome. The ACA safeguard for patients who need access to clinical trials is similar to a protection that already exists for Medicare beneficiaries.

In the face of extreme economic pressure, major transformations are occurring in both the public and private health insurance sectors. Policy makers are making piecemeal (but significant) changes to the traditional reimbursement systems at the same time that new models of reimbursement are being tested by Medicare’s Innovation Center and private payers. Oncologists and other cancer care professionals must remain engaged in helping to shape these changes to ensure that efforts to reduce health care expenditures do not undermine the quality of care received by persons with cancer, as well as to ensure that fair and adequate reimbursement exists to permit the ongoing delivery of high-quality, high-value cancer care.

Conclusion

Policies promulgated by government at the federal, state, and local levels have profound effects on virtually every aspect of the day-to-day practice of oncology. In the face of extreme financial pressures, policy makers will continue to make decisions that have tremendous impact on the cancer community. Oncologists and other cancer care specialists have unique insights involving the care of patients with cancer, and it will continue to be increasingly important to communicate these insights effectively. Policy can have a profound impact on practice, making engagement in the process not only important but a professional responsibility.