A few months ago, in the wake of a National Coverage Determination for BIIB's Aduhelm that significantly reduced prospects for its utilization, Secretary of HHS Xavier Becerra pledged to review the 2022 Part B premiums. The idea, apparently, was that through the heroism of the SecHHS Part B premiums would be lowered and the administration could claim some credit for "controlling drug prices" this fall.
Of course, it was all fiction to begin with. The Office of the Actuary did not specifically consider Aduhelm' s costs in its 2021 Trustees report, citing uncertainties, and until last week had not published any estimates that we can find. Further, a mid-year review of premiums is unheard of, administratively burdensome and actuarily suspect. To his credit the head actuary, Paul Spitalnic, declined to revise the 2022 Part B premium and instead indicated that fall rate setting would take into account all relevant experience.
Also to his credit - this is Washington after all - Mr. Spitalnic offered a retrospective estimate of Aduhelm' s role in the Part B rate setting, had that information been available in late 2021, as follows:
As noted above, the 2022 Part B premium is $170.10, and, as it was set back in November 2021, it includes a greater level of uncertainty than is typical regarding the potential costs associated with Aduhelm. If the same assumptions and methods that were used in the original determination were applied but all of the possible effects of Aduhelm were completely eliminated, then the 2022 Part B premium amount recommended by OACT last fall would have been $160.30. Alternatively, if all spending assumptions used in the 2022 premium development were the same but the annual price for Aduhelm were updated to $28,200, then the OACT recommended 2022 Part Bpremium last fall would have been $166.50. Lastly, if all spending assumptions remained as assumed in the 2022 premium but the annual price for Aduhelm were updated to $28,200 and the NCD with evidence development was reflected, the 2022 premium recommendation last fall would have been $160.40.
In other words, Part B premiums would have increased between 7.5% and 11% instead of the 14.5% due to the factors originally cited. The primary driver remains, as the actuary pointed out last year, an increase in the intensity of delivered Part B services and a high level of uncertainty associated with post-COVID utilization.
Inflation is a sore spot for the White House so none of the alternative scenarios would offer much comfort. But hey, all good because the COLA for Social Security increased for the first time in years.
So goes things through the looking glass in Washington, DC.
Emily Evans
Managing Director – Health Policy
Twitter
LinkedIn
