Australian cancer registry data

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An article published today and available free in The Medical Journal of Australia by Louise Gordon of QIMR provides an insight into another aspect of the Australian healthcare system in addition to the controversial issue of out-of-pocket medical costs.

The findings are based on 452 cancer patients diagnosed from Nov 2010- Nov 2011 identified via linkage to the Queensland Cancer Registry. Melanoma accounted for 44% of cases, prostate 25%, breast 19%, colorectal 7% and lung 5%. The costs for medical services and pharmaceuticals were collected for the 2-year period following diagnosis via data linkages with Medicare.

The power of data linkage is clear, but in 2018, how useful is information on services performed prior to Dec 2013?

All cancers, except basal and squamous cell carcinomas of the skin, are notifiable diseases in Australian states and territories. This means there is legislation in each jurisdiction that requires hospitals, pathology laboratories and various other institutions to report all cases of cancer to their central cancer registry.

An agreed minimum data set collected by these cancer registries is supplied annually to the Australian Institute of Health and Welfare (AIHW), where it is compiled into the Australian Cancer Database (ACD). The ACD currently contains data on all cases of cancer diagnosed from 1982 to 2012 for all states and territories, and for 2013 cases for all jurisdictions except NSW.

However, the current data set does not collect any genetic information at tumour-level, and this needs to be addressed urgently to ensure the ongoing value of the data.

Further to this, the introduction of an electronic health record for every Australian, unless they opt out, by the end of 2018 should be the catalyst for an overhaul of the existing cancer registry infrastructure to enable faster availability of collected data to researchers and policy makers.

Community Pharmacy Agreements

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Community Pharmacy Agreements (CPAs) take the form of 5-year ‘contracts’ between the Commonwealth Government and the Pharmacy Guild of Australia. These determine the remuneration paid to pharmacists for dispensing pharmaceutical benefits and to perform other functions required under that agreement. An interesting nuance is that the agreements also include wholesaler compensation. Why wouldn’t the National Pharmaceutical Services Association (NPSA), who does represent the wholesalers, as well as other relevant stakeholder groups, also be in the negotiation room and part of the agreement?

An independent statutory body, the Pharmaceutical Benefits Remuneration Tribunal (PBRT) was established in 1981 under section 98A of the National Health Act 1953 (the Act) to determine compensation levels. Immediately prior to 1990, remuneration consisted of a dispensing fee and a 25% mark-up on PBS listed items.

In the late 1980s, there was a dispute between the Commonwealth Government and the Pharmacy Guild around the issue of whether the price paid for dispensing PBS drugs should be based on the average cost of dispensing across all pharmacies, or the cost of dispensing in an ‘efficient pharmacy’. No agreement on calculating the price on an efficient pharmacy basis could be reached.

This period of unrest ended after the 1990 election, and since 1990, section 98BAA requires the Commonwealth to enter into successive five-year agreements with the Guild, ‘or another pharmacists’ organisation that represents a majority of approved pharmacists’ approved to supply PBS subsidised medicines in Australia.

The first Community Pharmacy Agreement was negotiated and covered the period 1991-95. A new approach to dispensing fees was introduced with a combination mark-up and flat dollar amount based on the value of the PBS item. Financial incentives to close and amalgamate pharmacies were included to stimulate rationalisation of the distribution of pharmacy services. The intent being that lower pharmacy numbers would encourage economies of scale greater and profitability. From 1991-95, this program resulted in 630 pharmacy closures and 64 amalgamations, at a cost to Government of $52 million.

Other clauses restricted where a pharmacy could relocate its existing PBS approval, and imposing strict restrictions on approving a new pharmacy. Additional financial support was provided to community pharmacies in rural and remote areas, and by the end of the first Agreement, just over 400 pharmacies were receiving an Essential Pharmacy Allowance.

The second Community Pharmacy Agreement 1995-2000 consolidated the gains made by the 1CPA initiatives. It also included a fee for service to accredited pharmacists conducting limited medication reviews for nursing home residents. This expansion into payment for services will be further seen in future CPAs (in the next article).

Supply Chain Arrangements

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Today’s Budget Estimates 2018-19 Public Hearing of the Senate Community Affairs Legislation Committee on Outcome 4.3 Pharmaceutical Benefits (11.15 am – 1.15 pm) provided a few more details about the new pricing arrangements that are to be piloted from 1 July 2019.

The Department of Health is currently in discussion with a number of companies who have agreed to participate in the trial. Negotiation of changes to Special Pricing Agreement clauses have been underway since the start of 2018. There are currently 162 active Deeds of Agreement.

One of the four supply chain options being considered was described as having two flows of payments for PBS medicines from the Government. One, based on the effective price, being paid directly to the manufacturer. The other, paid directly to the pharmacy, based on eligible fees (dispensing & Administration Handling Infrastructure) including the wholesaler mark-up (per 6CPA, either 7.52% of ex-manufacturer price or a flat fee of approximately $70 depending on the medicine price to pharmacy). The pharmacy would then reimburse the wholesaler.

From 1 July 2018, three products will have changes to their published prices such that the cash flow issue for the Department of Finance and pharmacies will be ameliorated. An interesting consequence of rebates has been the impact on commercial rents where these are linked to business turnover. It is widely speculated that the 3 products treat Hepatitis C and the price reductions are possible due to decreases in company mandated global floor prices.

On the $1 billion provision for new PBS listings, an important question was taken on notice by the Department: will the medicines with positive PBAC recommendations being listed using the contingency funds require Cabinet approval?

Australian PBS Supply Chain

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The supply chain for Australian Pharmaceutical Benefits Scheme (PBS) medicines has come sharply into focus during the changes to rebate arrangements recently pursued by the Federal Government, and whose introduction has subsequently been delayed until July 2019.

Supply chain refers to the specialised pharmaceutical wholesalers and pharmacies (community and hospital) that provide distribution, dispensing and patient care services associated with each listed medicine beyond the manufacturer’s door. This is not necessarily a straight forward endeavour in a sparely populated large country like Australia, and considering the cold-chain and other storage and handling requirements for some medicines.

While the PBS debate has been about time to and funding of new listings, as well as overall investment in the scheme, protagonists of the supply chain have been efficiently taking steps to secure, and even grow their proportion of the PBS ‘pie’. Current estimates put supply chain costs, after removal of rebates, as representing up to as much as 40% of Government expenditure on the PBS.

To put this in context, the proportion is comparable to the 41% reported for the sector in the USA, although the supply chain there includes the additional players in Pharmacy Benefit Managers and Insurers to be compensated.

The details of Government payments for provision of universal access to PBS medicines for Australians, no matter where they live within 24-hours, are contained in a series of, usually 5-year, agreements between supplier associations and the Commonwealth Government.

The content of some these agreements will be reviewed in the next few articles.

Cancer Screening Programs

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Monitoring reports for two of Australia’s government-funded, population-based national cancer screening programs were recently released by the Australian Institute of Health and Welfare (AIHW).

The report on the National Cervical Screening Program (NCSP) for women aged 20-69, measured incidence and mortality at 9–10 new cases, and 2 deaths, per 100,000 women, respectively. These rates have remained steady since halving between the introduction of the program in 1991 and 2002. The 2015-2016 report card however, shows two measures trending in the wrong direction over the past 3-5 years, with participation rates falling from 58% to 56%, and pap tests with no endocervical cells rising from 21 to 24%.

The impact of the National Human Papillomavirus (HPV) Vaccination Program is in evidence with a decline in the rate of detection of high-grade abnormalities for women under 30 as girls who were vaccinated against HPV move into the screening cohort.

Following a review of the NCSP by the Medical Services Advisory Committee (MSAC Application 1276) in 2014 an alternate Cervical Screening Test and pathway were recommended. The new NCSP commenced on 1 December 2017 with a five-yearly HPV test replacing the two-yearly Pap test. More than 99% of cervical cancers are caused by HPV, which includes squamous cell and adenocarcinoma. Neither the Pap nor the HPV test effectively detect the remaining <1% of neuroendocrine or small cell cervical cancers.
HPV vaccinated women are still at risk of cervical cancer from the 30% of oncogenic HPV types other than 16/18 (covered by the vaccine) known to cause cancer and hence, also need to participate in regular cervical screening.

Between January 2015 and December 2016, the participation rate in the National Bowel Cancer Screening Program was 41% of the eligible target population aged 50-74 years, which was slightly higher than the 39% recorded in the previous 2-year rolling period (2015-16). Of those who had participated in an earlier round, those returning for subsequent screening was 77%.

In 2016, approximately 8% of those screened returned a positive screening test. Of those who received a positive test, 68% had reported a follow-up diagnostic assessment.
Since the program commenced in 2006, data available for participants who have undergone a diagnostic assessment, reveal 1 in 30 have been diagnosed with a confirmed or suspected cancer, and 1 in 7 have had an adenoma detected.

The roll-out of biennial screening for those in the target group is expected to be completed by 2020.

Screening programs are funded by Federal and State Governments. In 2015-16, this amounted to $84 million for the cervical program and $56m for bowel. The reports may be downloaded from the AIHW website.

Remember the 10% MBS-PBS dataset?

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Update

The final report of the Productivity Commission inquiry into Data Availability and Use has been released. One of the Government’s responses is to create an Office of the National Data Commissioner, whose role is designed to implement an efficient data sharing framework within government.

Background
Back on 1 August 2016, the Department of Health published information on the Australian Government’s central catalogue of public data, data.gov.au, for a 10% sample of individuals who had made a claim for payment of Medicare Benefits since 1984, or Pharmaceutical Benefits since 2003. This was for research purposes in the public interest, and followed recommendations made by the May 2016 Senate Select Committee on Health’s Sixth Interim Report (Big Health Data: Australia’s Big Potential). The required precautions were considered to have been taken with regard to de-identification and privacy at the time.

Read more

National Cancer Data in one Place!

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Have you seen the National Cancer Control Indicators (NCCI) website?

It is Australia’s first single location of cancer data.

An initiative of Cancer Australia, the national cancer control agency, this data resource launched last November. The framework above shows the sources and type of data collected. The Australian Bureau of Statistics (ABS) and Australian Institute of Health and Welfare (AIHW) feature prominently as data custodians.

Data is updated dynamically on the site as it becomes available and can be displayed as required using interactive features. The information is organised around the cancer journey from Prevention, Screening, Diagnosis, Treatment and Outcomes. Two further domains, Research and Psychosocial Care, are currently under development.

The site acknowledges that there is a large degree of variation in the availability and completeness of data for some cancer domains, and for certain tumour types. The data is still also relatively old, with the recently released National Cancer Stage at Diagnosis analysis dating to 2011. Despite these caveats, which will improve moving forward, it is a fantastic initiative and invaluable to policy makers, researchers and reimbursement submission writers!

Is this service Bulk Billed?

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The status of out-of-pocket (OOP) costs paid by Australian patients for healthcare continues to be an enigma. On one hand, regular media releases, reports & inquiries suggest it is an issue; while on the other, Australian Institute of Health & Welfare figures support a conclusion of limited growth in this component of healthcare spend, although somewhat blurred between public and private settings.

Clinician fees are one place where precise data, incorporating both public and privately provided services, are available, courtesy of the Department of Human Services Medicare payment system. Medicare bulk billing is at the discretion of the health professional. Patients assign their right to the Medicare benefit amount to the health professional, meaning the patient pays nothing and the health professional accepts the Medicare scheduled fee as full payment for provision of the service.

The Australia-wide Medicare schedule fee observance statistics for 2016-17 (see graph) show that the majority (over 80%) of doctor visits are bulk billed. However, removing the impact of the relatively higher volume of GP visits, reveals that approximately 65% of specialist visits did require an out-of-pocket payment by the patient during that period.

In defence of clinicians, the MBS rebate indexation freeze, first introduced for nine months by Labor in 2013, and a further 4-years from July 2014 by the Coalition, is considered a key factor contributing to the increasing gap (OOPs) between patient’s Medicare rebates and medical fees. The decision to extend the freeze for a further two years in 2016 was partially wound back in the 2017-18 Budget, with the provision of $1.0 billion to reintroduce indexation for certain items on the MBS.

‘Rebate gate’ (Part 2 of 2) – Potential Consequences

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Will the real price be revealed?

As described in Part 1, the Australian Federal Government wants to eliminate an existing process whereby certain PBS medicines are reimbursed through the supply chain at ‘published (list) prices’, even though a lower price, known as the ‘effective price’ has been agreed. At a latter date, sponsor companies repay (rebate) the difference between these two prices to the Government. For medicines where this applies, the real price paid is kept confidential for international reference pricing purposes, with the trade-off being subsidised access for Australian patients.

The schematic shows a simplified version of the current flow of money and product through the supply chain from manufacturer to patient based on the published price in the PBS schedule. Note that as mark-ups and fees are calculated on the published price, relevant adjustments are made and also repaid by sponsor companies as part of rebate amounts.

Who pays and when?

The Government is proposing that instead of one Medicare payment being made to a pharmacy on submission of an eligible claim for a dispensed PBS item, for those products to which a rebate applies, the Government will directly pay each step in the supply chain the relevant amount based on the effective price.

Two potential consequences become clear:

1.      Loss of confidentiality of the ‘effective price’. This should be of concern, as it means Australia may be moved to the end of the list of countries provided with the registration dossier for a new medicine. This will add years to the wait for innovative medicines before the TGA or the PBAC even get to consider the value offered to the Australia public.

It is the perfect storm as local affiliates will be forced to sacrifice access for Australian patients for markets that reference to PBS prices. This is a very real phenomenon, and decisions not to launch, or withdraw products have already been made locally by companies due to international reference pricing concerns.

You don’t need to look far to appreciate what the future may look like.

2.      Business mayhem. What happens to well-established terms of trade and legalities around ownership of goods and responsibility for product condition (cold chain continuance, breakages, delivery failures, etc.) with a move to agent status on the basis of ‘phantom’ invoices? The payment of GST as required at the various steps in the process will also need new systems and processes to ensure that obligations to the Australian Tax Office continue to be met (watch this week’s abc Four Corners program).

A way forward?

Without compromise, it is unlikely that change of such magnitude will be in place by the arbitrary time frame of 1 July 2018. Retaining the current arrangements with tweaks seems most sensible. What about tighter (such as, monthly) time frames around repayments to the Government? This would require a quicker turnaround of invoices than has currently been the case. Another option is for companies to pay rebates (monthly or quarterly) in advance based on Deed agreed utilisation estimates. Perhaps you have a better idea?