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2021 New Drug Approvals, By The Numbers

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Health and Human Services Drug Pricing Report – What Does It Mean?

 On July 9, 2021, President Biden issued an Executive Order affirming his administration’s commitment to encouraging competition in the prescription drug market as well as reducing the prices of prescription drugs in the United States. The order required the Secretary of Health and Human Services to report on the challenges addressing innovation and costs within the prescription drug market and to recommend legislative and administrative actions. The HHS report focused on three “guiding principles”: affordability, competition and innovation. By following these three principles, the report intends to illustrate a pathway to protecting patient access to prescription drugs while simultaneously improving quality of care. Controlling drug pricing has been a focal point for many years. Many proposals have been made but few have taken root. In fact, according to AARP’s report “ TRENDS IN RETAIL PRICES OF BRAND NAME PRESCRIPTION DRUGS USED BY OLDER AMERICANS, 2006 TO 2020 ” the cost

President Biden Signs Law Delaying Medicare Payment Cuts

On December 10, 2021, President Joe Biden signed into law the "Protecting Medicare and American Farmers from Sequester Cuts Act" (S.610). In addition to establishing procedures to be used to increase the nation's debt limit, the Act makes a number of changes to the Medicare program that stakeholders have called for. Stakeholders have argued that without these changes, Medicare fee-for-service payments could have fallen by $14.1 billion in 2022 alone. The infographic below shows the five key Medicare takeaways from this Act.  The full text of the act is online .

Benefit Category Determinations

On December 21, 2021 CMS released an early Christmas present for stakeholders who have clamored for many years for a formalized process for making benefit category determinations (BCD). A BCD is a national decision by CMS whether an item or service meets the statutory definition of a benefit category. Benefit categories include: durable medical equipment, prosthetics, orthotics, supplies and others. When an item meets the definition of a benefit category, it may be covered by Medicare -- as long as the item is not otherwise excluded from coverage by law and is reasonable and necessary for an individual's medical condition. Since the implementation of Section 531(b) of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), CMS has hosted annual public meetings to discuss preliminary coding and payment determinations for new items and services.  Since 2005, this process of making preliminary payment determinations has included the determination of w

CMS Releases Final New Technology Add-on Payment Decisions

On August 2, 2021, CMS placed on display at the Federal Register the final fiscal year 2022 Inpatient Prospective Payment System Final rule. Amongst the over 2,000 pages are CMS's final decisions on New Technology Add-on Payments (NTAP) for FY 2022. The NTAP program was designed to identify new technologies and to ensure that payment under the IPPS would be adequate so that early adopters of  new technologies would not be financially disadvantaged. Under the traditional NTAP pathway, a technology must be considered "new",  the charges of cases involving the technology must be more than 75 percent of the unadjusted rate for the MS-DRG to which the technology is assigned, and the technology must represent a substantial clinical improvement over existing technologies.  Beginning in 2021, CMS implemented an alternative NTAP pathway for technologies granted "break-through" approval by the FDA and for certain antimicrobial products. For this alternative pathway, techn

CMS Proposes Modifications to Coverage for Opioid Use Disorder Treatment

  Since January 1, 2020, CMS has made separate payment for the treatment of opioid use disorder when furnished by qualified opioid treatment practitioners (OTP). This new Medicare benefit, established by the SUPPORT Act, allows CMS to make bundled payments for weekly episodes of care. Medicare will pay for episodes of care that include drugs, for non-drug episodes of care, for intake and periodic assessments, take-home dosages of methadone and buprenorphine, as well as for additional counseling. Pricing The episodic payment rate includes reimbursement for the drug- and non-drug-components of the encounter. Pricing for the drug component of the bundle is set using the most appropriate pricing mechanism currently in place and varies depending on the drug. Annual updates to the drug component of the bundle are made using the most recently available data from the applicable pricing mechanism. The non-drug portion of the bundle is updated based on the Medicare Economic Index. To reflect var

CMS Proposes Revisions to Drug Pricing Policies

In the CY 2022 Physician Fee Schedule Proposed Rule, released yesterday ( CMS is proposing two changes to its long-standing policies on drug pricing.  First, CMS is proposing to require manufacturers of drugs covered under Part B to report ASP data even if the manufacturer does not have a Medicaid rebate agreement. Noting that many manufacturers without a Medicaid rebate agreement currently report ASP data to CMS, CMS believes its proposed will cause little upset to manufacturers and would in fact preserve the status quo.  In a 2017 report (, MEDPAC presented findings many repackagers do not report ASP data to CMS and that this failure to report could be skewing Medicare payment rates. In this year’s proposal, CMS presents its own findings that exempting repackagers from reporting ASP data could increase errors in ASP calculations and delay CMS’s ability to timely pu