Physicians who administer biosimilar medications are reimbursed far less for the drug than it cost them to purchase it. This leads to a significant financial loss each time a provider administers one of these biosimilars, putting them financially “underwater” for the clinical visit. While Congress has increased the ASP “add-on” for select biosimilars for a limited five-year period through the Inflation Reduction Act, physicians are still underwater with these highly rebated biosimilars because the ASP is so artificially low. This disparity creates immediate financial hardship on physician practices and leads to an unsustainable situation.
When physicians cannot afford to offer these biosimilars due to underwater reimbursement, it leads to decreased overall biosimilar usage. It can also force providers to send patients elsewhere for treatment, often at a much higher cost. Independent, private practice in-office infusion centers are a much lower-cost option than hospitals infusion centers, where higher costs are incurred due to facility fees and elevated rates. If no alternative site can be secured, the patient ultimately loses access to the biosimilar medication because their insurance refuses to cover the reference product or any of the other biosimilar options. In only covering the “fail first” option, healthcare providers are left with no other choice but to try the patient on a completely different medication.
Ultimately, these perverse market incentives are forcing patients to “fail first” provider administered biosimilars that are unaffordable for the provider and lead to higher costs for the patient and the healthcare system, including the government and self-insured employers.
For a more in-depth overview of CSRO’s concerns regarding Underwater Biosimilars, click here.
The Coalition of State Rheumatology Organizations (CSRO) and the American College of Rheumatology co-lead the Underwater Biosimilar Coalition, which includes over 40 organizations nationwide working to address this reimbursement issue. Through the coalition and through its own advocacy work, CSRO regularly engages the Centers for Medicare & Medicaid Services (CMS) and the Medicare Payment Advisory Commission (MedPAC), as well as with congressional offices, on this priority issue.
Contact your elected officials through CSRO's Action Center and make your voice heard.
