Reforming oncology reimbursement is one method that could increase incentives to manufacturers and subsequently reduce drug shortages, according to testimony at a Senate Finance Committee hearing.
The hearing addressed causes of the recent drug shortages. About 30% of the drugs in short supply are oncology products.
Oncology drugs are reimbursed according to average sales price and an additional 6% markup that covers practice costs as a result of the Medicare Modernization Act in 2003, according to a perspective published last month in the New England Journal of Medicine. The authors said in the perspective that oncologists have incentive to use brand-name drugs that will provide a higher margin.
Source: Modern Healthcare