Impact of Medicare Drug Price Negotiation on Infusion Centers
Patients in New Mexico, including areas like Albuquerque, Santa Fe, and Las Cruces, rely on local infusion centers for treatments essential in managing chronic conditions such as Crohn's disease and rheumatoid arthritis. These centers provide accessible healthcare near patients' homes, supporting continuity of care. However, recent legislative changes threaten the financial sustainability of these centers.
The Inflation Reduction Act introduced the Medicare Drug Price Negotiation Program, which will set "maximum fair prices" for specific Part B medications starting January 2028. The goal is to reduce costs for patients and taxpayers by revising how prices are determined within Medicare. Yet, the reimbursement strategy proposed by the Centers for Medicare and Medicaid Services (CMS) could endanger the operational viability of community-based infusion centers.
Currently, these centers receive drug reimbursements based on the average sales price (ASP) plus a 6% margin, covering essential operational costs. CMS plans to adjust payments to align with the lower maximum fair prices (MFP) plus 6% for drugs within the negotiation program, potentially reducing Medicare reimbursements by 42% to 61%. Such cuts may also affect commercial insurance plans, as MFPs will influence ASP calculations.
If financial pressures compel infusion centers to close or reduce services, patients might be redirected to hospital outpatient departments, where treatment costs are significantly higher. Treatments at hospital-based centers cost approximately 53% more than at ambulatory infusion centers.
To address these issues, the Protecting Patient Access to Cancer and Complex Therapies Act has been proposed in Congress. This act aims to ensure that savings under the Medicare program come from drug manufacturers, maintaining adequate reimbursement levels for providers and preventing the inclusion of MFPs in ASP calculations to safeguard commercial reimbursements.
The act, currently awaiting further action in both the House and Senate, is designed to preserve healthcare affordability and accessibility by protecting community infusion resources. Insurance providers and stakeholders are closely watching the legislation's progress, as its implementation could significantly affect the delivery of care to patients reliant on these services.
Brady Porter, chief revenue officer and co-founder of Pure Healthcare, emphasizes that aligning legislative improvements with the practical needs of local healthcare providers is crucial for sustaining patient access to vital treatments.