Pay-for-Performance Moves Ahead
AAO Says Ophthalmology Will be in the Forefront.

As Congress and the CMS move forward to implement pay-for-performance (P4P) or "value based purchasing," ophthalmology is now well positioned should it choose to participate, asserts the American Academy of Ophthalmology (AAO).

CMS Administrator Mark McClellan, M.D., indicated his commitment to establishing some form of P4P, with or without legislation, and announced that the agency will initiate a voluntary quality reporting system for physicians next year. Without legislation to provide funding, the 2006 program may not include additional compensation for participating physicians.

The AAO stepped up the development of quality measures for ophthalmology in early 2005 in response to congressional calls for physicians to take a leadership role. Its long-range goal is to have ophthalmology ready to compete for any additional monies that may become available in a new P4P payment system.

The Academy initiated a process to actively engage ophthalmic specialties in the effort, which resulted in eight performance measures for ophthalmology. Dr. McClellan recently distributed a list of all CMS-accepted clinical measures, including six from ophthalmology taken from the AAO's original list of eight. CMS will convert the measures on the list to G-Code, which are monitoring codes that are easily reportable on existing Medicare claim forms. Practices should be aware that having an EMR system will be of great benefit in meeting any P4P data-documentation requirements.

"With the measures in place, ophthalmologists can participate in the 2006 rollout of the voluntary reporting program if they choose to. The Academy has been out in front on this issue from the beginning. It has a long history of embracing the concept of quality standards as shown by the stature of our Preferred Practice Patterns," said Richard L. Abbott, M.D., the Academy's secretary for quality of care and knowledge-base development. "Fortunately, the Academy was able to facilitate a strong collaborative effort among the ophthalmic subspecialties, which made development of the first set of measures for ophthalmology quick work. Because of our efforts, most ophthalmologists will not only have the option of participating in the reporting demonstration project, but will feel comfortable doing so."

The Academy also consulted in the development of H.R. 3617, the P4P legislation introduced by Rep. Nancy Johnson, (R-Conn). The repeal of the Sustainable Growth Formula (SGR) has long been one of the Academy's top priorities. The Academy has made it clear that any legislative attempt to create a new system that pays physicians based on some kind of performance measures must also be linked to an SGR fix. Rep. Johnson's bill is the first P4P legislation to meet that requirement.

"Our top priority is fair and reasonable reimbursement for ophthalmologists. The best way to achieve that is to be ready and engaged on all fronts — legislative and administrative," said Catherine Cohen, the Academy's vice president of governmental affairs.

Major ASC Legislation is Proposed
Key Ophthalmic Groups Back Reform Bill.

Rep. Wally Herger (R-Calif.) has introduced legislation that would substantially reform the system under which ASCs are reimbursed and regulated. The legislation is at an early stage of its journey through Congress but already has the support of the American Academy of Ophthalmology, the Outpatient Ophthalmic Surgery Society and American Association of Ambulatory Surgery Centers.

First, the bill would adopt the recommendation of the Medicare Payment Advisory Commission that ASCs should be allowed to perform and receive Medicare facility payments for any surgical service, except for those procedures that the Department of Health and Human Services Secretary designates as unsafe to beneficiary safety when furnished in an ASC, or those that require an overnight stay. If enacted, this provision will vastly expand the procedures for which ASCs will be reimbursed.

Second, effective Jan. 1, 2008, the bill would link ASC payments to the payment rates which hospital outpatient departments (HOPD) receive under Medicare, generally paying ASCs at 75% of the HOPD fee schedule amount for each covered service.

The bill would also enable ASCs to receive annual payment updates and adjustments that hospitals now receive for drugs and medical devices. There would be a phase-in period for ASCs to transition from their current payment system to the HOPD payment system.

Currently, aggregate ASC payments for ophthalmic procedures stand at about 72% of HOPD payments, though specific procedures performed in ASCs are reimbursed at various levels in comparison to HOPD reimbursement rates. For example, at a 75% reimbursement ratio, payment for YAG capsulotomies performed in ASCs would drop sharply, cataract reimbursement would rise modestly, and payment for some common retinal procedures would double.

Ophthalmic organizations support the 75% ratio because HOPD reimbursement is increasing at about 3% annually, while ASC payments are frozen until 2010 under provisions of the current law. Thus, if no new legislation is enacted, ASCs will continue to see their reimbursement drop in comparison to HOPD payments.

The ophthalmology organizations also believe that the 75% ratio is realistic and essentially budget-neutral, giving the legislation the best chance of being passed in Congress.

IN THE NEWS

AcrySof toric approved. Alcon, Inc., said that the FDA has approved the AcrySof Toric IOL for use in cataract patients with pre-existing corneal astigmatism.

The AcrySof Toric lens is based on the AcrySof single-piece IOL design and acrylic material platform. The lens incorporates an optical design that corrects for pre-existing astigmatism in cataract patients, resulting in what the company says are significantly improved distance visual outcomes.

"Approval of the AcrySof Toric IOL is an important addition to our AcrySof IOL product portfolio and further demonstrates our commitment to helping cataract surgeons achieve the best possible outcomes for their patients," said Robert J. Stevens, vice president, Surgical Products Research and Development, Alcon, Inc.

The company is now targeting a commercial launch of the AcrySof Toric in conjunction with the annual meeting of the American Society of Cataract and Refractive Surgeons in March. In the interim, the company will continue to pursue approval of a blue-light absorbing chromophore designed to be incorporated in the AcrySof Toric lens.

K Lilly to file NDA. Eli Lilly and Company said it has completed a phase 3 clinical trial in which its investigational drug, ruboxistaurin mesylate (proposed brand name Arxxant) reduced the occurrence of vision loss in patients with diabetic retinopathy (DR). As a result, Lilly believes it is appropriate to submit a new drug application (NDA) to the FDA at the end of 2005 for the treatment of DR as the initial indication for Arxxant. If approved, Arxxant will be the first treatment for DR that can be taken orally.

Lilly said ruboxistaurin is a specific protein kinase C beta (PKC beta) inhibitor, the first of a new class of compounds being investigated for the treatment of diabetic retinopathy (DR) and diabetic peripheral neuropathy (DPN).

Doctors: Be Wary of Wall Street
Investigators Warned on Confidentiality Issues.

Allegations that clinical investigators involved in studies of ophthalmic drugs provided information to Wall Street analysts during paid "consultations" have led the American Society of Retinal Specialists and
the American Academy of Ophthalmology to caution ophthalmologists about relationships with Wall Street that may compromise confidential study data. The following statement has been released jointly by the two organizations:

"Serious legal issues may arise when an ophthalmologist who is an investigator in a clinical trial or a member of a data safety monitoring board consults with a representative of the investment industry about an ongoing study.

"First, providing information to the investment industry regarding the results of a clinical trial or even your general impressions of how a clinical trial is proceeding will, in many instances, be a breach of your clinical trial agreement, making you vulnerable to a breach of contract claim and liable for any damages caused by your breach. You also could be terminated from participation in the clinical trial. As a practical matter, clinical trial sponsors may avoid your participation in future trials.

"Second, providing information to the investment industry might violate state and federal statutes and regulations that prohibit insider trading, even if you do not buy or sell any securities. If you provide a "tip" of confidential, nonpublic information that is material to the purchase or sale of securities, you are at risk. Violations of the insider trading laws may result in significant monetary and/or criminal penalties. Senator Charles E. Grassley (R-Iowa), chairman of the Senate Committee on Finance, recently asked the Securities and Exchange Commission and the Department of Justice to investigate conduct that he said 'violates a trust that is fundamental to the integrity of both scientific research and our financial markets.' Given Senator Grassley's request and recent widespread publicity, prosecutions may follow.

"Please note that you are at risk whether or not you are compensated for your discussion with a representative of the investment industry. If you are being compensated, that increases the risk, especially with respect to insider trading issues.

"You may not think that you are providing confidential information when you speak with representatives of the investment industry. But responses to seemingly innocent questions may allow hedge funds and other investors to make significant trades in advance of FDA approval or disapproval of a new drug application."

The revelations relating to ophthalmologists came in a Seattle Times article which described clinical investigators' consultations with the Smith Barney investment firm earlier this year concerning the safety and efficacy of Lucentis for wet AMD. The Seattle Times charged that the consultations helped Smith Barney issue a report in early May correctly predicting that pivotal phase 3 Lucentis trial data would be impressive.

Subsequently, Ophthalmology Management pointed out that the Seattle Times article omitted relevant facts about phase 1 and 2 Lucentis data that have been publicly available since 2003 and that were predictive of the impressive results of the phase 3 trial.

REFRACTIVE SURGERY UPDATE

CK is OK for pilots. Ophthalmic device manufacturer Refractec Inc. said the Federal Aviation Administration (FAA) has established a protocol for airplane pilots wanting to reduce their dependence on glasses by having the NearVision CK (conductive keratoplasty) treatment.

"Certification by the FAA as a vision correction procedure for pilots validates the safety and value of CK as a refractive treatment," said Mitchell B. Campbell, president of Refractec, Inc. "Only the safest and most effective procedures obtain an FAA protocol and we're thrilled that pilots can now enjoy the benefits of NearVision CK."

U.S. pilots who are considering having CK to improve their vision may now have the procedure performed without losing their aeromedical certification for flying. First, before considering CK, the pilot should check with his or her employer (if employed by the airlines) and/or flight medical examiner to determine if CK is an appropriate treatment option and if post-CK vision meets their individual requirements for flying.

WORTH NOTING

New partnership. Topcon Medical Systems, Inc. and Anka Systems, Inc. have formed a strategic partnership to integrate their proprietary imaging solutions and jointly develop new and innovative products for the eyecare marketplace. This partnership will offer eyecare professional advanced solutions for digital imaging applications. The partnership focuses on the advancing needs for eyecare practitioners to capture, store and retrieve digital imaging information that is increasingly being managed within the eyecare practice.

"Anka Systems brings to Topcon advanced software engineering capability for image networking and remote Web access for images that perfectly enhance our IMAGEnet product offering," says Scott Hokari, president of Topcon Medical Systems. "This new partnership provides our IMAGEnet customer base with full-featured networked imaging capabilities for any practice."

K Refractec promotes Frinzi. Ophthalmic device manufacturer Refractec, Inc. announced the promotion of Thomas G. Frinzi to the new position of chief operating officer to oversee the company's growing global operations. Frinzi, formerly senior vice president of sales and marketing, will add clinical, regulatory affairs and quality assurance to his sales and marketing responsibilities. He continues to report directly to President and CEO Mitchell B. Campbell.

K CareCredit initiative. CareCredit, a leading patient financing company, has formed the CareCredit Ophthalmic Practice Advisory Board to work with refractive practices by helping to create programs and tools that will help those practices increase their business success.

K WaveLight awards. WaveLight, a developer, manufacturer and distributor of refractive surgery technologies, has honored three ophthalmologists for their role in bringing new refractive surgical technologies to the forefront.

WaveLight presented its Accento awards to Richard Lomas, M.D., of Renton, Wash., Philip C. Hoopes, M.D.,
of Salt Lake City, Utah, and David D. Dulaney, M.D., of Phoenix, Ariz. The Accento awards are presented each year to physicians who pioneer new refractive technologies in their communities. OM