Medicare can follow blazed trails to revitalize Alzheimer's care

If Medicare is allowed to step up to the challenge of Alzheimer’s, patients could receive affordable and good quality care as soon as their disease develops.

New Alzheimer's treatments, while not curative, have made significant strides, offering hope to millions. Yet, there's a pressing issue in how these treatments will be accessed, particularly when it comes to insurance coverage.

Commercial insurers, covering most people under 65, will hesitate to pay for these treatments. Not only are they expensive, but the long-term benefits will accrue after their coverage period when patients enter Medicare. 

And if they won't pay for treatments, there is little incentive to pay for diagnoses. Of the nearly 7 million Americans with the disease, about 5 percent develop clinical symptoms before age 65, putting them at a distinct disadvantage in the current health insurance landscape, as our research has shown.

It is time to consider some sweeping reforms to meet this problem and the issue of access to Alzheimer’s treatments generally. 

First, Medicare should be allowed to pay for biomarker screening of patients with cognitive impairment and treatment of Alzheimer’s disease, regardless of age. This would be similar to how Medicare pays for treatment for anyone diagnosed with end-stage renal disease, even if younger than 65 years.

Second, to ensure that Alzheimer’s treatments are cost-effective and to contain federal fiscal obligations, an Alzheimer’s carve-out is warranted from Medicare price negotiation exemptions for recently approved drugs. The law now enables such negotiations only after 13 years have passed since FDA approval, which would be in 2036 for the Alzheimer’s treatment Lecanemab.

The use of Medicare to pay for end-stage renal disease irrespective of age is instructive in the case of Alzheimer’s. Medicare coverage of dialysis was codified precisely because, at the time, dialysis was so prohibitively expensive that its use was heavily rationed. Expanding Medicare eligibility following a diagnosis of amyloid-positive mild cognitive impairment or dementia, regardless of the patient's age, would enable timely diagnosis and treatment of Alzheimer’s, especially for those who develop it before age 65.

At the same time, advocates must be careful not to overstate the benefits of Alzheimer’s treatments. Policymakers eagerly anticipated that many patients on dialysis would return to work, resulting in large offsets for the federal program, only to learn that most patients remained unemployed and unable to pay income taxes. Moreover, researchers must aim to provide accurate estimates of the prevalence of Alzheimer’s disease. The dramatic increase in the number of End-Stage Renal Disease diagnoses after the policy change surprised policymakers and, ultimately, resulted in a much costlier program than initially anticipated.

By negotiating pricing for Alzheimer's medications, Medicare could not only protect taxpayers but also establish a sustainable price to be paid to drug manufacturers that would encourage continued innovation. Negotiated pricing should tie the cost of new Alzheimer’s therapies to their real-world effectiveness, encouraging the development of even more effective treatments and ensuring a more sustainable future.

This is a potential win-win solution. An expansion of Medicare following a verified diagnosis of Alzheimer’s disease would lift a huge potential burden from commercial insurers and ward off crushing premium hikes. Doctors would be encouraged to make timely diagnoses of Alzheimer’s. Medicare and patients would, in turn, accrue benefits from the earlier treatment of the disease.

The current system results in few winners, and patients with early-onset Alzheimer’s disease bear the brunt of these poor economic incentives. The majority of people with cognitive impairment do not have a proper diagnosis. Hundreds of thousands are aging into Medicare without such a diagnosis. We estimate more than a million Americans are being left behind, excluded from the possibility of new treatment for Alzheimer’s disease while it is still possible to slow the disease's course.

If Medicare is allowed to step up to the challenge of Alzheimer’s, patients could receive affordable and good quality care as soon as their disease develops. Nothing less than the quality of life of millions of Americans, and the sustainability of U.S. healthcare spending, is on the line.

Jakub Hlávka is a nonresident fellow at the USC Schaeffer Center for Health Policy and Economics and director of the Health Economics, Policy and Innovation Institute at Masaryk University. Eugene Lin is an assistant professor of medicine at Keck School of Medicine of USC and a clinical fellow at the USC Schaeffer Center.