Boston University School of Law’s Kevin Outterson* looks at how cost-saving measures are contributing to the rise of drug-resistant “superbugs” in the US and the steps that need to be taken to remedy the situation.


Globally, 700,000 people lose their lives to drug-resistant infections each year

In November 2019, Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma outlined her agency’s strategy for combatting drug-resistant bacteria, or “superbugs.”


The announcement is timely. Bacteria are evolving to resist our most powerful antibiotic treatments. Globally, 700,000 people lose their lives to drug-resistant infections each year. By 2050, that number could grow to 10 million.


Yet, as Verma explained in her announcement, “Our antiquated systems for reimbursing physicians and hospitals for antibiotic treatment have disincentivized both the development and use of new antibiotics.” To ignite the level of antibiotic development we need, U.S. policymakers will need to change the way we dispense and pay for antibiotics.


Most infections can still be treated safely and effectively with generic antibiotics. But even when they’re battling multidrug-resistant infections, healthcare providers tend to use older, sometimes toxic antibiotics, simply in order to save money.


Consider colistin, a commonly prescribed antibiotic that dates back to the 1950s.


The antibiotic, which treats certain types of drug-resistant infections, often spurs kidney damage. Some colistin treatments cause acute kidney injuries in more than 50 percent of patients, according to a recent analysis. The medicine is so toxic that if it were invented today, the Food and Drug Administration probably wouldn’t approve it for sale.


Despite these well-known health risks, and the fact that newer, less toxic drugs are available for infections being treated with colistin, doctors have administered colistin in well over 1,000 cases per year.


Or consider oral vancomycin, which treats colon infections caused by Clostridioides difficile bacteria. Vancomycin hit the market in the 1950s but was not used much because it can damage people’s guts. In addition, it often fails to wipe out the infections it’s supposed to target.


Safer, more effective treatments exist for drug-resistant infections. Yet doctors often use oral vancomycin, in part because the drug is so cheap.


Why do hospitals repeatedly dispense these toxic medicines?


The “antiquated” Medicare reimbursement rules Verma described are largely to blame. In many cases, doctors would like to prescribe newer, more expensive, and more effective antibiotics. But hospitals receive the same flat payment regardless of whether they prescribe older treatments or newer ones. So they’re discouraged, if not barred, from dispensing the latest medicines, even if they’re the most clinically appropriate.


Further, these reimbursement rules hinder the development of new antibiotics. Investors won’t fund research into novel antibiotics if hospitals are unlikely to purchase them.


Fortunately, CMS is tackling this problem. The agency will let more novel antibiotics receive add-on payments and will increase what it pays for these drugs. “In the long-term, CMS will lead a broader effort to modernize Medicare’s payment systems for antibiotics and other endangered innovations,” Verma said.


The recently introduced, bipartisan DISARM Act represents another step forward. The bill would empower Medicare to offer a separate payment to hospitals that appropriately use novel antibiotics. That would remove the perverse incentive to prescribe older, toxic drugs.


CMS has also committed to revamping stewardship programs that aim to reduce the inappropriate use of antibiotics while ensuring that patients have access to the antibiotic that’s right for them at the right time.


Some hospitals evaluate the effectiveness of their stewardship programs by looking solely at what they spend on antibiotics. If they’re keeping costs down, the thinking goes, they must be using antibiotics responsibly. Indeed, between 1950 and 2017, only half the studies evaluating stewardship initiatives looked at clinical outcomes. Most reported on process outcomes, which include drug costs.


But effective stewardship programs should always consider patient outcomes, too. If CMS rationalizes the way it pays for antibiotics, then hospitals will be less tempted to zero in on cost as the chief determinant of whether their stewardship program is working.


Drug-resistant bacteria are a global public health crisis. The world is in desperate need of new cures. If policymakers take action, we can defeat the superbugs.


* These views are personal and do not necessarily represent the position of CARB-X or any CARB-X funder.