News

What practices need to know about the most favored nation rule

12/7/2020

Brad Tallamy, Senior Director, Government Affairs, AmerisourceBergen

The Trump administration recently finalized an Interim Final rule implementing the Most Favored Nation (MFN) payment system for Medicare Part B drugs beginning on January 1, 2021. Instead of the current reimbursement system of ASP+6, the MFN model caps reimbursement for the top 50 Part B drugs at the lowest price in 22 OECD nations with gross domestic products of at least 60 percent of the United States’ GDP.

CMS will also set a flat provider add-on payment of $148.73 per administration. There will be no beneficiary cost-sharing for this add-on payment.

The new Medicare reimbursement system applies to community physicians; group practices; hospital outpatient departments; ambulatory surgical centers, and other providers who bill under Part B for the included drugs.

Because the MFN methodology is set up to determine reimbursement to community physicians & other Medicare providers, the rate they are reimbursed may not be the price they paid for a drug. As a result, many practices—particularly smaller, rural providers—may be underwater under the MFN formula, losing money each time they administer the drug to a patient.

This is unsustainable, likely resulting in serious patient access issues. In fact, the rule states, “While there are significant savings as a result of this model, a portion of the savings is attributable to beneficiaries not accessing their drugs through the Medicare benefit, along with the associated lost utilization.”

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Visit the Take Action page to join our campaign to advocate for corrective action on Most Favored Nation (MFN) Model for Medicare Part B drugs.



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