On Friday, January 27, 2012, the Centers for Medicare & Medicaid Services (“CMS”) released its long-awaited proposed rule to implement the provisions of the Affordable Care Act (“ACA”) relating to pharmaceutical manufacturer payment of Medicaid rebates and limits on Medicaid reimbursement to pharmacies. The proposed rule addresses a number of important policy issues relevant to pharmaceutical manufacturers, pharmacies, and other providers, and also would pose significant operational challenges for pharmaceutical manufacturers with respect to the Medicaid Drug Rebate Program (“MDRP”).
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Actual Acquisition Cost
CMS Discusses Details of New “National Average Drug Acquisition Cost” Survey
By Robert Hill & Joseph W. Metro on
On August 4, 2011, CMS held an “External Stakeholders Meeting” at its Baltimore headquarters to discuss the development of a survey for what it is now calling “National Average Drug Acquisition Cost” or “NADAC”. Earlier this year, CMS announced that it would publish a pricing benchmark based upon pharmacies’ acquisition costs for both brand and generic drugs, which State Medicaid programs could use instead of Average Wholesale Price (AWP) or Wholesale Acquisition Cost (WAC) to establish pharmacy reimbursement rates. CMS has entered into a contract with Myers & Stauffer, LC, to develop NADAC; Myers & Stauffer currently collects pharmacy acquisition costs for Oregon and Alabama, two states that have made such costs an element of their Medicaid pharmacy reimbursement.
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CMS Awards “Survey of Retail Prices” Contract to Myers and Stauffer – Moves One Step Closer to Average Acquisition Cost
By Robert Hill & Daniel A. Cody on
On July 8, 2011, CMS announced that it had awarded Myers and Stauffer, LC a contract to prepare a monthly survey of retail community pharmacy (“RCP”) prescription drug prices. The contract is in furtherance of CMS’s commitment to develop and publish “Average Acquisition Cost” data reflecting RCPs’ purchase costs for all covered outpatient drugs, for potential use by State Medicaid agencies in rate-setting.
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HHS Offers States Ideas for Cutting Medicaid Costs
By Debra A. McCurdy on
On February 3, 2011, HHS Secretary Kathleen Sebelius sent a letter to state governors identifying areas of potential Medicaid cost savings in light of the difficult budget circumstances facing many states. Notably, to help states purchase drugs more efficiently, Sebelius announced that HHS is undertaking a national survey to create a database of pharmacies’ actual…
CMS to Publish Pharmacies’ Actual Acquisition Costs as New Drug Pricing Benchmark
By Debra A. McCurdy on
On February 3, 2011, HHS Secretary Kathleen Sebelius sent a letter to state governors identifying several areas of potential cost savings for state Medicaid programs. As part of a discussion regarding “purchasing drugs more efficiently,” Sebelius announced that HHS is undertaking a first-ever national survey to create a database of pharmacies’ actual acquisition costs (“AACs”) for prescription drugs that states may use as a metric to determine state-specific Medicaid reimbursement rates. The results from the survey are expected to be available during 2011.
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