CMS Finalizes 340B Cuts, Part B Drugs in Quality Payment Program, 2018 Physician Fee Schedule

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The Centers for Medicare & Medicaid Services (CMS) released its final rule on the 2018 Hospital Outpatient Prospective Payment System (PPS). In the rule, CMS finalized a proposal to cut reimbursement for separately paid drugs under the 340B Drug Pricing Program (340B) from average sales price (ASP) plus 6% to ASP minus 22.5%. Rural sole community hospitals, PPS-exempt cancer hospitals, and children’s hospitals will be exempt from this policy in 2018.

CMS also released final rules outlining changes to the Quality Payment Program (QPP) and the Medicare Physician Fee Schedule (MPFS) for 2018. The QPP rule includes a provision that makes Medicare Part B drug reimbursement subject to Merit-Based Incentive Payment System (MIPS) adjustments. In comments on the proposed QPP rule, ASCO urged CMS to refrain from implementing such a policy at any point in time, asserting that it would seriously distort the magnitude of MIPS penalties and bonuses far beyond anything Congress intended when drafting the Medicare Access and CHIP Reauthorization Act -(MACRA), which established QPP. ASCO’s data show that the median financial penalty for oncology practices under the proposal would range from 13.7% to 22.9%—well beyond the 4% penalty envisioned by Congress.

The QPP rule also includes relief for clinicians impacted by Hurricanes Irma, Harvey, and Maria, as well as other natural disasters. Specifically, the Quality, Advancing Care Information, and Improvement Activities performance categories will be weighted at 0% of these providers’ MIPS scores, and they will be awarded neutral payment adjustments for 2017. 

The 2018 Medicare Physician Fee Schedule rule shows an estimated 0% impact on the hematology/oncology community. It is important to note, however, that the actual impact on individual physician practices will depend on the mix of services provided.

ASCO is conducting a detailed analysis of all three rules and will submit comments to CMS during the open comment period. Stay tuned to ASCO in Action ( for more information when it becomes available. ■

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