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Part B Drug Reimbursement

Medicare Part B drug reimbursement to physicians continues to be on the “chopping block” in 2017. Last year, the Centers for Medicare and Medicaid Services (CMS) proposed a harmful Medicare Part B Drug Payment Model, which would have cut physician reimbursement from Average Sales Price (ASP) plus 6% to ASP plus 2.5% and a nominal flat fee. That proposal was defeated due to overwhelming concern from the patient and provider communities about the effect on patient access to office-based infusions.

This year, the Medicare Payment Advisory Commission (MedPAC) has released several policy proposals that would cut reimbursement for Part B drugs, including a reduction in the add-on percentage. Given that the effective add-on is already 4.3% due to budget sequestration, any additional cuts will jeopardize the ability of physicians to continue offering infusion in their offices. Other policy options include setting an ASP benchmark and requiring manufacturers to pay a rebate if drug spending exceeds a target; grouping “like” drugs into a “single billing code” which would be paid at the volume weighted average of all the products ASP+6%; and a “drug value program” that would entail independent vendors negotiating with manufacturers for lower prices.

The CSRO actively participates in the Coalition for Part B Access for Seniors and Physicians (“ASP Coalition”), which recently sent a letter to MedPAC signed by 183 organizations (including the CSRO), urging MedPAC to abandon any cuts to Part B drug reimbursement.