CMS Delays Launch of Optional Program for Medicare Payment of Part B Drugs
CMS is delaying until July 2006 the start of an optional program that will revise payments for Medicare Part B drugs administered in doctors' offices, CMS Administrator Mark McClellan announced Thursday, CQ HealthBeat reports. The Competitive Acquisition Program, created as part of the 2003 Medicare law and originally scheduled to begin in January 2006, is being delayed for six months because of problems with the competitive bidding process, according to CQ HealthBeat.
CAP is intended to serve as an alternative to the current "buy and bill system," under which doctors purchase Part B drugs themselves and then are reimbursed by Medicare. CAP seeks to reduce overpayments for the drugs and lessen paperwork for physicians by giving them the option of obtaining drugs from a wholesaler that then would bill Medicare. CMS has been holding a competitive bidding process for drug wholesalers to take part in the program, and the bidding was scheduled to end on Friday.
However, wholesalers have not been submitting bids "aggressively" because manufacturers have been "reluctant" to provide discounts, CQ HealthBeat reports. The manufacturers are concerned that price discounts for participating wholesalers would decrease Medicare reimbursements that they receive if doctors continue to obtain Part B drugs outside of CAP. House Ways and Means Committee Chair Bill Thomas (R-Calif.) has urged CMS to alter the bidding process to exclude discounts given to CAP from calculations of reimbursement amounts paid to manufacturers outside the program. In response, CMS has suspended the bidding process to allow time to address the issues (CQ HealthBeat , 8/4).
McClellan on Thursday also announced that CMS after Oct. 1 no longer will process claims that are not HIPAA-compliant for Medicare reimbursement, according to CQ HealthBeat. In a news release, CMS said that about 0.5% of Medicare fee-for-service providers submitted non-HIPAA-compliant claims as of June 2005. After Oct. 1, such claims will be returned to the filer for resubmission, according to CMS.
"We are firmly committed to an interoperable electronic health care system, and the close-to-100% compliance with HIPAA standards for claims shows that the health care industry shares this commitment," McClellan said (CQ HealthBeat , 8/4).
In related news, HHS Secretary Mike Leavitt on Thursday visited several towns in the southern U.S. to promote the new Medicare prescription drug benefit. The visits were part of a "100-city tour" that is scheduled to end in late September (Powers, Memphis Commercial Appeal, 8/5).
- Arkansas: On Thursday, Leavitt met with about 250 people at a North Little Rock senior center to explain the benefit. Prior to his speech, Leavitt met privately with representatives from 70 groups that work with senior citizens to encourage them to help educate local residents about the drug benefit (Wecsler, Arkansas Democrat-Gazette, 8/5).
- Mississippi: Leavitt also visited with about 150 Medicare beneficiaries and providers at the Jackson Medical Mall to urge enrollment in the new benefit and to encourage beneficiaries to apply for additional financial aid for prescription drugs under Medicare (Wagster Pettus, AP/Biloxi Sun Herald, 8/4).
- Tennessee: Leavitt also spoke before about 100 people at the Hope & Healing Center in Memphis after meeting privately with ministers, providers, public officials and others about the new benefit (Memphis Commercial Appeal, 8/5).