Senate Finance Committee Chairman Orrin Hatch, R-Utah, criticized the Obama administration Tuesday for ignoring a Republican demand that it scuttle a proposed rule that would change the way Medicare reimburses doctors for certain drugs.
GOP members of the Senate Finance Committee have been calling for the administration to withdraw its rule over fears that it would make it harder for rural physicians to purchase drugs for their patients.
But at a Tuesday hearing, Hatch said the Centers for Medicare and Medicaid Services has given his committee the cold shoulder, even after 14 senators sent a letter laying out its arguments to kill the rule.
“We received what essentially amounts to a form letter, thanking the committee members for sharing their views and noting that CMS will consider all public comments,” Hatch said. “It could not have been more dismissive in its tone.”
Patrick Conway, deputy director of CMS, didn’t have a definitive answer for Hatch, and said the agency is going through more than 1,300 comments. He declined to withdraw the rule.
“We take the input from Congress and from stakeholders across the healthcare system very seriously,” he said. “We are reviewing the comments now and plan to make adjustments within the final rule.”
The rule would change the reimbursement given to doctors for drugs reimbursed under Medicare Part B, which pays for drugs that are administered in a doctor’s office. Chemotherapy drugs delivered in an outpatient facility or doctor’s office are an example of a drug that falls under Part B.
CMS currently pays a doctor the average sales price of the drug plus six percent. But the administration is worried this may incentivize doctors to prescribe higher priced drugs to get a greater reimbursement.
The agency wants to change the reimbursement to the sales price of the drug plus about two percent and a small fee.
Republicans say that could hurt rural doctors, who might lose money purchasing drugs that patients need, Hatch said.
Some Democrats were open to the proposal, noting that it can help to address high drug prices roiling healthcare now. But other Democrats were also worried about what the rule means for rural healthcare providers.
“I am concerned that the scope of the proposal seems broader than that for a demonstration project,” said Sen. Debbie Stabenow, D-Mich.
The administration has pointed to experts who say the experiment could help ensure drugs are properly prescribed per their value.
“All the research shows that prescribing patterns and hospital purchases of doctors’ offices are heavily influenced by the proportional profits model of drug reimbursement,” according to Dr., Peter Bach, a cancer researcher with Memorial Sloan-Kettering Hospital in New York. “CMS is gently trying to move towards a system that pays doctors for doing what they are trained to do, take care of patients, and make the same money whether they use more or less expensive drugs.”
