Senate drug pricing plan unveiled

July 25, 2019

Senate Finance Committee leaders Tuesday unveiled a sweeping legislative package aimed at addressing drug prices. They have scheduled committee action Thursday on the bill, which was developed by Chair Chuck Grassley (R-IA) and the panel’s senior Democrat, Ron Wyden (OR). Sen. Cantwell serves on the committee.

The plan would overhaul Medicare Part B and D benefits, as well as Medicaid. Among the Part B changes, the bill would apply “site neutral” payment cuts to drug administration services furnished in off-campus hospital outpatient departments that were grandfathered in the 2015 budget bill. Thus, payments for all Part B drug administration services would be at the physician fee schedule rate beginning in 2021.

The measure would also cap the add-on payment at $1,000 for each Part B drug paid under the average sales price (ASP) or wholesale acquisition cost (WAC) methodology, beginning Jan. 1, 2021. The provider billing for the drug would be paid the lesser of the add-on amount that would otherwise be paid – 6 percent of the ASP or 3 percent of WAC – or $1,000 through Dec. 31, 2028. Beginning in 2029, the maximum add-on amount would be updated by CPI-U.

For Part D, the bill would reduce beneficiary cost-sharing and tie drug price increases to the rate of inflation.

In other news from Washington, congressional leaders and the White House agreed this week to raise budget caps and increase the nation’s borrowing limit for the next two years. A two-year extension of the Medicare sequester – through 2029 – was the only Medicare offset included in the package.

The House is expected to vote on the measure on Thursday before adjourning for a six-week recess. The Senate is expected to vote next week. (John Flink)


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