States Rally Behind Innovative Treatment Program
The healthcare landscape for rare disease treatment is undergoing a significant transformation as the Centers for Medicare & Medicaid Services (CMS) prepares to officially announce participating states in its groundbreaking Cell and Gene Therapy (CGT) Access Model this June. This innovative initiative represents a pivotal shift in how cutting-edge therapies reach patients with rare and previously untreatable conditions.
According to recent reports from Bloomberg, the program has already gained remarkable traction, with one state already implementing the model and 35 additional states signaling their commitment to participation. This robust response encompasses approximately 84% of Medicaid beneficiaries living with sickle cell disease, the initial focus of the CGT Access Model.
Financial Hurdles Create Implementation Challenges
Despite the program’s promising expansion, a comprehensive report from the Pharmaceutical Strategies Group (PSG) reveals significant concerns among insurers regarding the financial sustainability of cell and gene therapies. The survey, which gathered insights from representatives of employers, health plans, and unions, highlights a widespread apprehension about cost management.
Nearly three-quarters (73%) of respondents identified the affordability of these advanced therapies as either a moderate or major challenge anticipated in the next two to three years. This concern is even more pronounced among health plan representatives, where the figure climbs dramatically to 87%. The financial uncertainty extends beyond immediate cost concerns, with a majority (70%) of respondents expressing limited confidence in their understanding of the long-term financial implications these treatments might have on their organizations.
Balancing Innovation with Affordability
The fundamental challenge lies in reconciling the transformative potential of gene therapies with their substantial upfront costs. The CGT Access Model, first introduced in 2023, aims to address this tension by creating sustainable pathways for treatment access while simultaneously working to flatten the cost curve over extended periods.
While the model’s initial implementation targets sickle cell disease patients, CMS has indicated that the framework could eventually expand to support a broader range of gene and cell therapies. This scalable approach recognizes the rapidly evolving therapeutic landscape and prepares healthcare systems for upcoming innovations.
Real-World Cost Implications
The financial magnitude of these treatments cannot be overstated. According to PSG’s analysis, therapy for hemophilia B currently carries a price tag of approximately $3.5 million per patient, while treatment for acute lymphoblastic leukemia can cost up to $475,000. Industry experts anticipate continued growth in this sector, with PSG estimating “a dozen new” therapy approvals expected this year alone.
The report’s authors emphasize an urgent need for education, noting that “benefits leaders may require additional education about the CGT pipeline to fully appreciate value and develop interest in CGT financial protection products.” This knowledge gap represents a significant barrier to implementation that extends beyond mere cost concerns.
Limited Adoption of Risk-Sharing Models
The survey further reveals a hesitancy to embrace innovative payment structures that could help manage these extraordinary costs. An overwhelming 90% of employer respondents and 60% of health plan representatives reported no participation in value-based contracts or warranties through risk-sharing financial programs with pharmaceutical manufacturers.
However, there are early signs of movement toward alternative payment models, with 28% of health plan respondents indicating they have engaged in risk-sharing financial agreements. These pioneering arrangements may provide valuable blueprints for broader implementation as the market continues to evolve.
Policy Shifts and Program Continuity
Recent political developments have introduced additional complexity to the program’s implementation. President Donald Trump, in his first week back in office, issued an executive order rescinding a Biden-era directive that had instructed the CMS Innovation Center to test three models, including the CGT Access Model.
Despite this policy shift, a CMS spokesperson subsequently clarified to Fierce Healthcare that the order would not disrupt the CGT Access Model’s ongoing operations. This reassurance suggests a recognition of the program’s importance across administrations and its potential to address critical healthcare needs regardless of political considerations.
Industry Perspectives and Future Outlook
PSG, which conducted the comprehensive survey, brings significant industry expertise to these findings. As one of the largest independent pharmacy benefit consulting firms before its acquisition by EPIC in 2021, its analysis carries substantial weight within the healthcare sector.
The report concludes with a broader observation about industry priorities, noting that approximately 80% of respondents identified managing specialty drug costs as one of their top concerns. This statistic contextualizes the specific challenges of cell and gene therapies within the larger landscape of pharmaceutical expense management that continues to challenge healthcare systems nationwide.
As the June announcement approaches, stakeholders across the healthcare spectrum will be watching closely to see how this ambitious model unfolds and whether it can successfully balance the competing priorities of innovation, access, and financial sustainability.
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