When prices surpass benefits — CMS' proposal may bring the Medicare Part B drug payment system up to speed

CMS' proposal to change the way providers are reimbursed for Medicare Part B drugs has sparked fierce opposition from various physicians and medical groups across the country. Many claim the proposal, which would lower the drugs' add-on payments from 6 percent to 2.5 percent with an additional $16.80 flat payment, will limit patients' access to the critical drugs they need.

However, drug prices are soaring, and the benefits these drugs could provide are largely overshadowed by the exorbitant prices pharmaceutical companies charge, according to an article Morning Consult published by Peter B. Bach, MD, director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Center in New York City.   

In his article, Dr. Bach cited evidence stating while biologic drugs increased 335 percent in the last 10 years, spending on cancer surgeries have remained the same. These drugs do have benefits for patients, but "the prices for cancer drugs have risen much faster than the benefits."

However, concerns over the proposal are valid in that payments may be lower. If the proposal comes to fruition, oncologists would have a 1 percent deduction in drug-associated Medicare revenue. Physicians who use more costly drugs may face steeper financial losses. Healthcare is transitioning to pay-for-performance and Dr. Bach explained the current payment system has lagged behind other payment systems focused around value-based care. However, CMS has to make certain changes to the system to ensure it doesn't negatively impact small practices or beneficiaries.

Dr. Bach claimed CMS should calculate the flat drug fee for each specialty separately, so some specialists are not disproportionately affected by the payment update. To maintain oncologist pay, Dr. Bach and his colleagues calculated the flat drug fee in oncology would have to be increased from $16.46 to $23.74. Additionally, CMS should consider reexamining the flat fee to ensure it aligns with care coordination and chronic care management payments.

All facets of the care spectrum, ranging from specialty groups to patients, should play a part in the payment update as it impacts all parties. Dr. Bach said, "Technical, administrative and scientific issues are challenging but manageable, and could be addressed in a way that these groups can support."

More articles on coding & billing:
Latest payer ACA departures further limit consumers' options — 5 takeaways
Medicaid reimbursed 6 Texas institutions an extra $57.8M due to erroneous calculations — 6 things to know
Can the ACA make a comeback? 4 key takeaways

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

 

Featured Webinars

Featured Whitepapers

Featured Podcast