Will CMS add home infusion drugs to bid program?

Thursday, February 21, 2013

WASHINGTON – The Office of Inspector General (OIG) recommends in a new study that CMS change the way it pays for home infusion drugs.

One of the options laid out by the OIG: Include home infusion drugs in the next round of competitive bidding. While external infusion pumps and supplies were included in the Round 1 re-compete (but not Round 1 or Round 2), CMS has not included drugs at all. CMS concurred with this recommendation.

The second option: Seek a legislative change requiring home infusion drugs to be paid using average sales prices (ASPs), instead of average wholesale prices (AWPs). The OIG found that between 2005 and 2011, home infusion drugs based on AWPs exceeded their ASPs by 54% to 122% annually. Medicare spending would have been reduced by 44%—or $334 million—during this time period had payment amounts been based on ASPs. CMS partially concurred with this recommendation.

The OIG conducted the study because, while Medicare pays 106% of the ASP for most drugs covered under Part B, it pays 95% of the AWP for home infusion drugs.