CMS may set new standards on high-priced drugs

CMS Administrator Seema Verma, MPH, told Reuters the agency is considering several options to limit Medicare and Medicaid’s costs for covering breakthrough medical treatments with very high price tags.

In an interview at the Forbes Healthcare Summit in New York, Verma mentioned two different potential models:

• Paying different drugs for one drug based on its success treating certain conditions, “such as paying more for a therapy that works better for breast cancer than it does for lung cancer or liver cancer.”
• Extending the time frame for paying for higher-priced drug rather than immediately paying in full after its administered to a patient.

Verma said both methods have been considered by pharmacy benefit managers in the private sector. The second approach may be particularly helpful with gene-based therapies aimed at small patient populations.

Neither approach would allow CMS to negotiate drug prices directly with manufacturers, a change which would require action from Congress.

“We are trying to do whatever we can within the regulatory structure,” Verma said.

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