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Medicare Part B Payment Model “Part B Demo” Officially Withdrawn


On October 3, CMS officially withdrew the much maligned Part B Demo, nearly a year after the 2016 elections forced the Obama Administration to halt its implementation. Senate Finance Chairman Orrin Hatch (R-UT), House Energy & Commerce Chairman Greg Walden (R-OR) and Ways & Means Chairman Kevin Brady (R-TX) praised the decision:

“Today’s announcement is welcome news for seniors, ensuring the Obama administration’s experiment that would have limited the critical care they and other Medicare beneficiaries need, will not be resurrected in the future. We are pleased the previous administration did not proceed with their plan, and we commend the Trump administration for going a step further and wiping the flawed proposal from the books for good.”

The Part B Demo was the Obama Administration’s final effort to address drug pricing. In an attempt to force physicians to prescribe cheaper medications, the Demo would have cut reimbursement for Part B drugs whose ASP exceeded $480. Since its proposal in 2016, ABC took a leadership role in opposing the Demo by building collaborative stakeholder and grassroots support, developing bipartisan Congressional opposition letters, and advancing data-driven arguments to illustrate the Demo’s impact on community-based practices and patients. Our efforts effectively disproved the flawed premise that physician prescribing behavior is driven by Medicare reimbursement rather than patients’ best interest.

Under the Trump administration, CMS has signaled it will evaluate new payment models that improve quality, accessibility, and affordability. ABC will continue to lend our expertise and data-driven insights to the Agency’s efforts while also ensuring patient access to innovative medications as value-based payment models evolve.

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