Trends in Antineoplastic Receipt after Medicare Payment Reform: Implications for Future Oncology Payment Design

The Medicare Modernization Act (MMA) reduced reimbursement for many antineoplastics delivered in outpatient settings, altering practice patterns for some cancers. To further evaluate the MMA's effect, we focus on colon cancer, where longstanding fluorouracil-based regimens were augmented in 2004 with 3 newly-approved drugs (oxaliplatin, bevacizumab, and/or cetuximab). Staggered implementation of MMA reimbursement changes (physician offices implemented reimbursement changes in 2005 vs hospital outpatient departments(OPD) in 2006) provide a natural experiment to examine policy effects.

Using the 2000-2009 SEER-Medicare data, we examined antineoplastic use among 59,642 stage II-IV colon cancer patients. Using multivariate logistic regression models, we conducted difference-in-differences analyses to examine an interaction between time (pre-post MMA) and setting (physician offices versus OPDs) on antineoplastic receipt, adjusting for patient and cancer characteristics. A significant interaction indicates different practice patterns in physician offices versus OPD during the staggered implementation.

After the reimbursement change in 2007-09 relative to 2000-03, use of fluorouracil-based therapy decreased slightly (Marginal Probability(MP): -0.07 stage II; -0.05 stage III; -0.05 stage IV; p< 0.01), while use of new drugs increased substantially (MP: 0.48 stage II; 0.69 stage III, 0.79 stage IV; p< 0.01). The interaction between MMA implementation and physician office setting was significant when examining use of new agents for Stage IV disease only.

Our results indicate that providers responded to reimbursement changes after the MMA by increasing use of newly approved agents, but the magnitude of the response was small and limited to individuals diagnosed with Stage IV disease.