New Medicare Drug Pay Model Invites Industry Clash

Law360, New York (March 8, 2016, 9:32 PM EST) -- Federal regulators on Tuesday proposed a nationwide, five-year test of new drug payment policies aimed at cutting costs in Medicare Part B, likely touching off a significant fight with drugmakers, doctors and hospitals.

The proposal would affect most health care providers that bill for Part B drugs, which tend to be injectables or infusion products administered in professional settings. Under the plan, providers would be placed randomly into one of four groups: three that use new payment models, and one that uses the existing model and serves as a control group.

The existing model pays providers the so-called average sales price...

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