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A Project of The Annenberg Public Policy Center

60 Plus Wrong on Rationing

The chairman of the conservative 60 Plus Association made the bogus claim that the Food and Drug Administration has "declassified" a breast cancer drug "because of cost and cost alone," an example, he said, of the "rationing" of Medicare because of the federal health care law.

Jim Martin, the head of 60 Plus, made the inaccurate statement in an interview with ABC News in which he also claimed that "ending Medicare as we know it happened a year ago in March … when Obamacare passed."

Martin, April 27: And already rationing has started. I can name you one drug, it’s a breast cancer drug, called Avastin that has already been declassified by the FDA because of cost and cost alone. That is Medicare as we know it changed radically a year ago.

Martin is wrong. Avastin is not being rationed, and the Centers for Medicare and Medicaid Services tells us that Medicare will continue to cover it. The drug has not been "declassified … because of cost and cost alone." Instead, the FDA has recommended removing breast cancer from the label "because the drug has not been shown to be safe and effective for that use," a Dec. 16, 2010, FDA press release says.

Cost is not mentioned anywhere in the press release, and FDA spokeswoman Erica Jefferson told us: "Cost has absolutely nothing to do with the decision." In fact, she says, the FDA cannot make a decision based on costs. "That’s in our regulations; that’s public information."

Avastin is also prescribed for colon, kidney, brain and lung cancers, and the FDA said the breast cancer decision "will not affect" those approvals. Nor does this mean that patients have to stop using the drug for breast cancer, or that doctors cannot prescribe it for breast cancer. "The drug will still be available and the FDA doesn’t regulate the practice of medicine," Jefferson told us. If a doctor wants to use the drug, he or she has the option to do so, she said.

The FDA said that it reviewed four clinical studies of treatment of breast cancer with Avastin and found that the benefit of using the drug didn’t outweigh health risks, which include complications such as "heart failure" and "hemorrhage."

FDA, Dec. 16, 2010: The agency is making this recommendation after reviewing the results of four clinical studies of Avastin in women with breast cancer and determining that the data indicate that the drug does not prolong overall survival in breast cancer patients or provide a sufficient benefit in slowing disease progression to outweigh the significant risk to patients. These risks include severe high blood pressure; bleeding and hemorrhage; the development of perforations (or “holes”) in the body, including in the nose, stomach, and intestines; and heart attack or heart failure. In July 2010, after reviewing all available data an independent advisory committee, composed primarily of oncologists, voted 12-1 to remove the breast cancer indication from Avastin’s label.

Jefferson said that the drug manufacturer appealed the FDA recommendation and a hearing has been scheduled for the end of June.

Does the FDA decision have any bearing on Medicare? "Absolutely none at all," says Don McLeod, public affairs specialist at the Centers for Medicare and Medicaid Services. McLeod told us that removing the label for breast cancer "does not affect us." If a doctor prescribes the drug, Medicare will cover it. "We frequently pay for off-label uses for drugs," he said. "We cover it and have no plans to stop covering it."

Rep. Phil Gingrey of Georgia and other Republicans have charged, without evidence, that the FDA based its decision on cost, a claim also disputed by Richard Pazdur, director of the FDA’s cancer division in an interview with the Wall Street Journal. The paper reported that "[so]me insurers have said they won’t cover it for new breast cancer patients." We don’t know whether that will happen, but McLeod told us Medicare will continue to cover the drug.

Martin made his false claim about Avastin as support for his statement that "ending Medicare as we know it happened a year ago in March …when Obamacare passed. Because it radically changed Medicare as we seniors know it by cutting a half a trillion dollars out of Medicare."

As we’ve said before, the health care law calls for $555 billion in cuts in the future growth of Medicare spending over 10 years. It doesn’t call for axing half a trillion from current spending, as Martin’s statement may lead some to believe.

In the interview, the 60 Plus chairman gave another false example of the law’s impact. He was wrong when he said that these cuts in Medicare spending have caused three hospitals in Scranton to close. "There’s already hospitals that are in dire straits," Martin told ABC News. "Three up in Pennsylvania near Scranton have stopped, have closed their doors, quite frankly, because of these cuts or these savings."

But three hospitals in Scranton weren’t closed. They were sold and renamed. The sale of the Mercy Health Partners’ hospitals to Community Health Systems was approved in late March. Last fall, a group called CatholicVote.org claimed in a radio ad that the hospitals were "calling it quits" because of the health care law, and Republicans claimed the law was "a main reason" for the sale. But the CEO of the hospitals said his words were being "severely distorted." The CEO, Kevin Cook, said in a statement: "Discussions about mergers, acquisitions and strategic partnerships have been conducted in our health care community for years — long before the passage of the Affordable Care Act. Our decision announced [in October] was due to many factors."

We called 60 Plus to ask if Martin was possibly referring to any other hospitals near Scranton, but we have not yet received a response. According to a state website, only two Pennsylvania hospitals closed in 2010, and none has closed this year. One of the 2010 closings was UPMC Braddock, which closed in January 2010, before the health care legislation even became law.

Update, April 29: FDA spokeswoman Erica Jefferson sent us this link to the agency’s regulations. The information on drug approvals is in 314.125. Cost is not listed as a reason the FDA can give for refusing to approve a drug. "There is no mention of cost in the numerous details we provide on how we approve drugs or why we refuse to approve them," Jefferson said. "If it’s not outlined in our statute, we can’t legally factor it in."