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Medicare Part B
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The Medicare Prescription Drug Improvement and Modernization Act of 2003 established average sales price reimbursement methodology for drugs reimbursed under Medicare Part B program. Part B drugs, sometimes referred to as specialty pharmaceuticals, are those administered in the outpatient or physician office setting and are considered administered “incident to” a physician’s services. Reimbursement to physicians of the costs related to such drug administration includes the Actual Sales Price (ASP) plus 6% to cover additional associated expenses.
The ASP+6% fee schedule is market driven and has worked well. Since the formula was enacted reimbursement for drug prices have been reduced to levels closer to provider purchase prices  and payment rates for drug administration increased. In 2013, sequestration resulted in the reimbursement rate for Part B drugs to be cut to ASP+4.3%.  Physicians have already encountered challenges to obtaining some drug products. Further cuts will only imperil patients, their access to life-saving treatments and place many physician practices, especially small rural providers, at risk, causing serious disruptions for extremely ill patients.
MichBio opposes any cuts to physicians who administer Medicare Part B drugs and thereby limit beneficiary access to important life-saving drugs. We oppose any Congressional action that would make changes to the ASP reimbursement system. MichBio supports ASP+6% to ensure adequate patient care.

Related Resources

CMS Rule on Physician Fee Schedule - Federal Register 2013
MedPac A Data Book - Health Care Spending and the Medicare Program (pdf)
MedPac Report on Impact of Changes to Medicare Payment (pdf)
MichBio Letter to Congress re Part B and ASP 2012 (pdf)
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