Medical Billing Consultants

Healthcare Reforms

A new proposed rule issued in March 2016, aimed at creating a new Medicare payment methodology for part B drugs administered by physicians and other providers, is taking a lot of heat from both parties of the Congress. Both Republican members of the House of Representatives and the Democratic Senators on the Senate finance committee sent letters to CMS administrator Andy Slavitt raising concerns on the proposed bill. The Republicans members also suggested CMS to withdraw its policy completely, if possible.

As per Medicare Part B, drugs such as cancer medications, antibiotics, or eye care treatments must be administered by a physician or a health care provider, in an office setting. The Average Sales Price of the drug currently paid by Medicare is 2.5%, which is going to be lowered in the first phase by 6%. And on top of that, it would add a flat fee of $16.80 per drug per day for all Part B drugs.

Medical Billing Medisoft

Plan B Drug Payment

For the most recent 12-month period, the consumer price index for medical care, CMS will update the flat fee at the beginning of each year by the percentage increase. Similar to those used by commercial health plans and others to manage drug utilization, the second phase will implement what CMS calls “value based purchasing tools”. It would be more cost effective and efficient way to pay for Medicare drug costs.

Many of the same concern are expressed in the two letters. It is the concern of the legislators that reducing the reimbursements of Part B drugs could cause the administration of certain drugs to result in a financial loss for the practice and would therefore limit beneficiary access to these treatments. Also, they think that the CMS payment reform initiative of the Oncology Care would get undermined because of this proposal.

Both parties feel this is too big for an experiment, which could push patients away from community based providers and hospital outpatient department. But since it release many patient groups as well, providers have come out in support of the CMS proposal despite the concerns of the Congress.