CMS Decision to Abandon Medicare Part B Demo Greeted With Sighs of Relief

After widespread criticism from healthcare providers, drug companies, and lawmakers, CMS has announced that it will not go forward with its proposed Medicare Part B payment program. The experimental reimbursement model was intended to reduce outpatient drug spending, but oncologists worried it would have unfairly slashed their Part B payments.

After widespread criticism from healthcare providers, drug companies, and lawmakers, CMS has announced that it will not go forward with its proposed Medicare Part B payment program. The experimental reimbursement model was intended to reduce outpatient drug spending, but oncologists worried it would have unfairly slashed their Part B payments.

Under current Part B reimbursement rules, providers receive payments of an additional 6% of the sale price of a drug administered by infusion or injection. The proposed 5-year mandatory initiative, which was developed by the Center for Medicare and Medicaid Innovation at CMS, would have cut the extra payment to 2.5% of the drug’s average sale price plus a flat payment of $16.80 per drug per day.

The proposed changes were supposed to control drug spending by incentivizing physicians to choose less expensive drugs, but practitioners in some specialties said the new model was not feasible for them. In particular, oncologists raised concerns that they would be reimbursed much less for the expensive cancer treatments they provide. CMS acknowledged in the proposed rule that payments to medical oncologists would decline by 0.7% while increasing by 1.3% across the board for all specialties.

The decision by CMS not to implement the model came after the proposed rule provoked vastly negative public comments and pressure from lawmakers, including House Minority Leader Nancy Pelosi. In a statement, Pelosi said she and colleagues were “pleased” with the decision to cancel the proposal, a sentiment echoed by a number of patient advocacy groups.

“Cancer patients and their providers across the country can breathe a sigh of relief now that the Part B experiment on cancer care is finally dead,” said Ted Okon, executive director of the Community Oncology Alliance, in a statement. “It was encouraging to have such strong support from Congress to end this proposed model that was, at best, an overreach by CMS, created with no stakeholder input.”

The American Medical Association was also heartened by the announced reversal. In a statement, president Andrew W. Gurman, MD, said the group was “grateful that CMS came to the right decision after listening to stakeholders.”