Medicare/Medicaid reimbursement not keeping pace with rising cost of alteplase

The cost of IV tissue plasminogen activator has more than doubled since 2006, while Medicare/Medicaid reimbursement has only increased by 8% during the same time period, according to data presented at the International Stroke Conference.

Dawn Kleindorfer, MD , FAHA , professor in the neurology and rehabilitation department and director of the stroke team at the University of Cincinnati, reported during a press conference that while IV tissue plasminogen activator (alteplase, Genentech) is still overall cost-effective — 564 quality-adjusted life years and millions in nursing home and rehabilitation costs saved — there is a disconnect between drug costs and hospital reimbursement.

Kleindorfer and colleagues evaluated the average sales price of alteplase since 2006, and compared it with the reimbursement hospitals receive from CMS. Using the CMS website, they calculated the base payment for alteplase and then they compared it against the Consumer Price Index.

One limitation of the study, Kleindorfer acknowledged, is that the drug manufacturer cost did not reflect regional and local variations in price.

According to the findings, between 2005 and 2014, there was a 111% increase in the cost of the medication, while all other prescription drugs according to the Consumer Price Index increased by 30.2%. Kleindorfer and colleagues reported that 1 mg of alteplase cost $30.50 in 2005 and $64.30 in 2014, translating to $6,500 for a standard 100-mg vial of alteplase in 2014.

During the press conference, Kleindorfer pointed out that the biggest change in drug cost occurred in 2009 and that by 2013 “over half of the total [hospital] reimbursement was going towards the cost of the drug.”

The other half of the reimbursement is expected to cover all other hospital costs related to the care of a patient with stroke.

Kleindorfer said that the government assumes “that all drugs are marked up equally.” However, “that’s not what actually happens,” she said. “The lower-cost drugs have a much higher markup than the higher-cost drugs. Hospitals would have to charge $30,000 per vial to achieve the mark-up rate that CMS assumes.”

Kleindorfer emphasized that “health care providers that are caring for these stroke patients need to be aware of this increased cost as they’re managing their stroke centers’ finances.

“Stroke physicians need to come together and lobby the government to increase the [diagnosis-related groups’] payments to the hospitals so that we’re not using up so much of the reimbursement we have on their first dose of medication,” she said. – by Tracey Romero

References:

Kleindorfer D, et al. Abstract 78. Presented at: International Stroke Conference; Feb. 16-19, 2016; Los Angeles.

D isclosures: Kleindorfer reports receiving speaking fees from Genentech. Please see the full abstract for a list of all other researchers’ relevant financial disclosures.