Payer-Specific Negotiated Prices for Prescription Drugs at Top-Performing US Hospitals

Feldman, William B.; Rome, Benjamin N.; Brown, Beatrice L; Kesselheim, Aaron S.

doi:10.1001/jamainternmed.2021.6445

Cited by 10 publications

(14 citation statements)

References 3 publications

(4 reference statements)

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“…Negotiated prices in our study varied greatly within hospitals as well as across hospitals, which is consistent with many previous reports on price transparency 17‐19 . Price variations have largely been attributable to differences in market power between insurers and providers.…”

Section: Discussionsupporting

confidence: 89%

“…Negotiated prices in our study varied greatly within hospitals as well as across hospitals, which is consistent with many previous reports on price transparency. [17][18][19] Price variations have largely been attributable to differences in market power between insurers and providers. Our subanalysis demonstrated that hospital-level factors, particularly 340B status and geographic location in the northeast and west, also appear to significantly impact price markups.…”

Section: Discussionmentioning

confidence: 99%

“…Nondisclosure has been documented in previous studies and is concerning in that it limits a patient's ability to budget for out-of-pocket costs of care. [17][18][19] A recent analysis by Xiao et al of the top 25 parenterally administered cancer therapies found a price disclosure rate of 44.1%, significant price variation between hospitals, and a large range in price markups over acquisition costs (118%-633%). Our study confirms these findings among the top hospitals in otolaryngology.…”

Section: Discussionmentioning

confidence: 99%

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Private Payer‐Negotiated Rates for FDA‐Approved Head and Neck Cancer Immunotherapy and Chemotherapy Agents

Talwar

Kim

et al. 2023

Otolaryngol.--head neck surg.

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ObjectiveTo quantify the price that private payers pay hospitals for head and neck squamous cell carcinoma (HNSCC) treatments and identify hospital‐level factors associated with price variation.Study DesignCross‐sectional study.SettingPrice transparency files.MethodsFiles from the top 50 hospitals in otolaryngology according to the US News and World Report were analyzed between December 2021 and June 2022. This study analyzed the following Food and Drug Administration‐approved HNSCC therapies: pembrolizumab, nivolumab, cetuximab, cisplatin, carboplatin, and paclitaxel.ResultsTwenty‐four (48%) hospitals reported prices for at least 1 medication in our sample. Newer biologics were significantly more expensive than traditional chemotherapeutic agents. Given approved medication regimens, all biologics in our sample have similar annual costs. Price markups over acquisition costs ranged between 109% (pembrolizumab, nivolumab) and 530% for carboplatin. Across hospitals, prices varied the most for paclitaxel, the cheapest medication in our sample, and prices varied the least for pembrolizumab the most expensive medication in our sample. Hospital 340B status and geographic location in the northeast/west are associated with lower price markups.ConclusionPrice nondisclosure remains a significant problem among hospitals. Newer biological medications are more expensive when compared to traditional chemotherapeutic agents. Prices vary significantly across hospitals, with lower price markups observed in 340B hospitals as well as hospitals located in the geographic northeast and west. It remains to be seen if price transparency will lead to more uniform pricing or lower costs of treatments.

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Section: Discussionsupporting

confidence: 89%

Section: Discussionmentioning

confidence: 99%

Section: Discussionmentioning

confidence: 99%

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Private Payer‐Negotiated Rates for FDA‐Approved Head and Neck Cancer Immunotherapy and Chemotherapy Agents

Talwar

Kim

et al. 2023

Otolaryngol.--head neck surg.

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“…A recent analysis of 10 high-expenditure drugs at 20 top-rated hospitals found that 45% were noncompliant with requirements to disclose payer-specific negotiated drug prices that, when disclosed, were typically much higher than Medicare payment limits . Our study builds on this work by additionally estimating hospital markup relative to acquisition costs and the magnitude of price variation over the course of treatment in a larger and more clinically homogeneous cohort of NCI-designated cancer centers.…”

Section: Discussionmentioning

confidence: 99%

“…Third, the findings may underestimate the extent of price markups and variations if centers chose not to disclose any drug prices or selected drug prices to prevent public concern about price-gouging . Fourth, we were unable to ascertain the proportion of patients at each hospital covered by specific insurance plans; thus, the findings may not accurately reflect average prices weighted by payer and plan mix . Fifth, we were unable to estimate the extent to which negotiated prices were associated with patient out-of-pocket costs, which depend on plan benefit design; for example, higher prices would not directly translate to higher costs for patients who have already reached out-of-pocket spending caps.…”

Section: Discussionmentioning

confidence: 99%

Hospital-Administered Cancer Therapy Prices for Patients With Private Health Insurance

et al. 2022

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rule, which became effective in 2021, requires hospitals to publicly disclose payer-specific prices for drugs. However, little is known about hospital markup prices for parenterally administered therapies.OBJECTIVE To assess the extent of price markup by hospitals on parenterally administered cancer therapies and price variation among hospitals and between payers at each hospital. DESIGN, SETTING, AND PARTICIPANTSA cross-sectional analysis was conducted of private payer-specific negotiated prices for the top 25 parenteral (eg, injectable or infusible) cancer therapies by Medicare Part B spending in 2019 using publicly available hospital price transparency files. Sixty-one National Cancer Institute (NCI)-designated cancer centers providing clinical care to adults with cancer were included. The study was conducted from April 1 to October 15, 2021.EXPOSURES Estimated hospital acquisition costs for each cancer therapy using participation data from the federal 340B Drug Pricing Program. MAIN OUTCOMES AND MEASURESThe primary outcome was hospital price markup for each cancer therapy in excess of estimated acquisition costs. Secondary outcomes were the extent of across-center price ratios, defined as the ratio between the 90th percentile and 10th percentile median prices across centers, and within-center price ratios, defined as the ratio between the 90th percentile and 10th percentile prices between payers at each center. RESULTSOf 61 NCI-designated cancer centers, 27 (44.3%) disclosed private payer-specific prices for at least 1 top-selling cancer therapy as required by federal regulations. Median drug price markups across all centers and payers ranged between 118.4% (sipuleucel-T) and 633.6% (leuprolide). Across-center price ratios ranged between 2.2 (pertuzumab) and 15.8 (leuprolide). Negotiated prices also varied considerably between payers at the same center; median within-center price ratios for cancer therapies ranged from 1.8 (brentuximab) to 2.5 (bevacizumab).CONCLUSIONS AND RELEVANCE Most NCI-designated cancer centers did not publicly disclose payer-specific prices for cancer therapies as required by federal regulation. The findings of this cross-sectional study suggest that, to reduce the financial burden of cancer treatment for patients, institution of public policies to discourage or prevent excessive hospital price markups on parenteral chemotherapeutics might be beneficial.

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Patient Out-of-Pocket Costs for Biologic Drugs After Biosimilar Competition

Feng,

Russo,

Maini

et al. 2024

JAMA Health Forum

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ImportanceBiologic drugs account for a growing share of US pharmaceutical spending. Competition from follow-on biosimilar products (subsequent versions that have no clinically meaningful differences from the original biologic) has led to modest reductions in US health care spending, but these savings may not translate to lower out-of-pocket (OOP) costs for patients.ObjectiveTo investigate whether biosimilar competition is associated with lower OOP spending for patients using biologics.Design, Setting, and ParticipantsThis cohort study used a national commercial claims database (Optum Clinformatics Data Mart) to identify outpatient claims for 1 of 7 clinician-administered biologics (filgrastim, infliximab, pegfilgrastim, epoetin alfa, bevacizumab, rituximab, and trastuzumab) from January 2009 through March 2022. Claims by commercially insured patients younger than 65 years were included.ExposureYear relative to first biosimilar availability and use of original or biosimilar version.Main Outcomes and MeasuresPatients’ annual OOP spending on biologics for each calendar year was determined, and OOP spending per claim between reference biologic and biosimilar versions was compared. Two-part regression models assessed for differences in OOP spending, adjusting for patient and clinical characteristics (age, sex, US Census region, health plan type, diagnosis, and place of service) and year relative to initial biosimilar entry.ResultsOver 1.7 million claims from 190 364 individuals (median [IQR] age, 53 [42-59] years; 58.3% females) who used at least 1 of the 7 biologics between 2009 and 2022 were included in the analysis. Over 251 566 patient-years of observation, annual OOP costs increased before and after biosimilar availability. Two years after the start of biosimilar competition, the adjusted odds ratio of nonzero annual OOP spending was 1.08 (95% CI, 1.04-1.12; P &lt; .001) and average nonzero annual spending was 12% higher (95% CI, 10%-14%; P &lt; .001) compared with the year before biosimilar competition. After biosimilars became available, claims for biosimilars were more likely than reference biologics to have nonzero OOP costs (adjusted odds ratio, 1.13 [95% CI, 1.11-1.16]; P &lt; .001) but had 8% lower mean nonzero OOP costs (adjusted mean ratio, 0.92 [95% CI, 0.90-0.93; P &lt; .001). Findings varied by drug.Conclusions and RelevanceFindings of this cohort study suggest that biosimilar competition was not consistently associated with lower OOP costs for commercially insured outpatients, highlighting the need for targeted policy interventions to ensure that the savings generated from biosimilar competition translate into increased affordability for patients who need biologics.

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Payer-Specific Negotiated Prices for Prescription Drugs at Top-Performing US Hospitals

Abstract: NIH) during the conduct of the study. Mr Crusan reported receiving grants from the NIH during the conduct of the study. Dr Heit reported receiving grants from the NHLBI, NIH during the conduct of the study. No other disclosures were reported.

Cited by 10 publications

References 3 publications

Private Payer‐Negotiated Rates for FDA‐Approved Head and Neck Cancer Immunotherapy and Chemotherapy Agents

Private Payer‐Negotiated Rates for FDA‐Approved Head and Neck Cancer Immunotherapy and Chemotherapy Agents

Hospital-Administered Cancer Therapy Prices for Patients With Private Health Insurance

Patient Out-of-Pocket Costs for Biologic Drugs After Biosimilar Competition

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