Senators Introduce Bill to Correct Medicare Reimbursement for Cancer Drugs

Reimbursement is often insufficient to cover the purchase cost of cancer drugs, forcing oncologists to pay out of pocket to treat patients

Last month, Senators Debbie Stabenow (D-Michigan) and Pat Roberts (R-Kansas) introduced S. 733, a bipartisan bill to ensure accurate reimbursement for cancer drugs. The bill’s intention is to amend title XVIII of the Social Security Act to exclude prompt-pay discounts customarily extended to wholesalers from the manufacturer’s average sales price (ASP) for the drugs and biologicals under Medicare Part B.

The average sales price (ASP) metric that is currently used to calculate reimbursement for Medicare Part B artificially reduces payment for cancer drugs to community oncology practices. As a result, the reimbursement is often insufficient to cover the purchase cost of the cancer drug, forcing oncology practices to pay out of pocket to treat patients with chemotherapy.

"A major component of the survival of community oncology is fair pricing for the chemotherapy drugs purchased on behalf of those patients,” Senator Roberts stated in a press release. “This bipartisan bill is designed to do just that.”

Eliminating the prompt-pay discounts from the current ASP equation will create greater uniformity across the federal healthcare programs and provide more reasonable reimbursement rates for oncologists.

"Fair drug pricing affects the financial survival of those providing care to the majority of cancer patients in this country, and this bill provides a much-needed reimbursement solution." said Senator Stabenow in a press release. "Without it, those practices will be jeopardized. If those providing cancer care are threatened, so are their patients. That is unacceptable."

According to the Community Oncology Alliance (COA), a nonprofit organization dedicated to community oncology, the cancer care delivery system in the United States is struggling due to significant cuts in Medicare payments for cancer drugs and related services. An impending shortage in the number of practicing oncologists combined with an increasing need for cancer care by our aging population will only exacerbate this problem.