Medicare Part B outpatient drug payment cancelled

The Center for Medicare and Medicaid Innovation will not move forward with a mandatory five-year Medicare initiative to test new ways of paying for outpatient drugs.

A Centers for Medicare and Medicaid Services spokesman announced the agency scrapped the program after reading more than 1,300 public comments, most of them negative.

“While the proposed Medicare Part B demonstration had admirable goals, our members raised a number of concerns, and we are pleased the Center for Medicare and Medicaid Innovation has decided not to move forward,” House Minority Leader Nancy Pelosi said in a statement.

The Part B demo program would have explored new ways to pay for drugs in an attempt to improve patient outcomes and cut costs. Medicare Part B reimburses 6 percent plus the average sales price of the drugs administered by infusion or injection in doctors’ offices and hospital outpatient departments. The agency proposed dropping the payment from 6 to 2.5 percent of a drug’s average sales price while adding a flat payment of $16.80 per drug a day.

Critics argued the current model incentivizes physicians to prescribe a more expensive medication while opponents argued the proposed pricing demonstration would have undermined physicians’ ability to care for patients and could pose a threat to patients’ safety. 

Nicole Stempak

Nicole was Senior Editor at I Advance Senior Care and Long Term Living Magazine 2015-2017. She has a Journalism degree from Kent State University and is finalizing a master’s degree in Information Architecture and Management. She has extensive studies in the digital user experience and in branding online media. She has worked as an editor and writer for various B2B publications, including Business Finance.