Cancer Care Ontario’s(CCO)latest initiative will have an impact on private drug plans, said Ellen Aquilina of ESI Canada at The Ontario Club in Toronto today.

Under CCO’s New Drug Funding Program(NDFP), created in 1995, drugs were administered and funded by the CCO. In 1997, the program was expanded to include newer, more expensive IV cancer drugs. Under the NDFP, hospitals have to submit manual requests to CCO for funding. CCO can then approve or disapprove funding based on clinical guidelines.

Last spring, CCO outlined a proposal to administer privately bought cancer drugs in Ontario hospitals. This proposal was sent to 14 hospitals across the province, said Aquilina.

The potential impact on private drug plans and, in turn, on plan sponsors, is fivefold.

• increase in costs, as hospitals will have more access to prescribe and administer non-formulary drugs

• costs shift to private payers, as there may be less incentive for CCO to provide funding for unsanctioned or even future IV cancer drugs

• increase in administrative costs as there will be more manual claims and also a lack of standard claims(each hospital has its own way of billing)

• an increase in auditing services to ensure claims aren’t overpaid

• using private clinics instead of hospitals. Some patients may opt to receive their medication in a clinic, which is currently happening with some non-formulary drugs, said Aquilina. At present, clinics are not regulated and may charge higher fees(than the current $250 charged by hospitals)and/or extra fees.

Aquilina recommends plan sponsors review the wording of their drug benefit plans to see what it is the plan actually pays for. They should also have a process in place for handling these claims, for example, any higher or extra fees. And sponsors may want to enlist a consultant with expertise on cancer and its therapies in order to determine coverage.

Although increased prescription and accessibility to the newer IV cancer drugs is positive for patients, it poses potential higher costs for private plans.

Plan sponsors, then, must review their plans and the process for reimbursement of these newer treatments, she said.

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