CMS Delays Medicaid Best-Price Drug Rule

The Centers for Medicare & Medicaid Services (CMS) released a proposed rule last Wednesday that delays the implementation of a Trump-era rule which would incentivize the use of value-based drug pricing agreements for the Medicaid program. The original version of the regulation was finalized in December 2021, but the Biden Administration will delay implementation to July 1, 2022.

The Medicaid Drug Rebate Program (MDRP) requires pharmaceutical manufacturers to issue rebates to Medicaid for covered outpatient pharmaceuticals, according to a fact sheet from the Institute for Health Policy. Medicaid programs must cover almost all drugs which reduced Medicaid’s ability to negotiate discounts. Fierce Healthcare reports the original rule required manufacturers to report multiple best prices for Medicaid-covered drugs if the manufacturer is participating in a value-based purchasing arrangement.

CMS said the delay would allow affected parties more time to adjust the “complex system changes necessary to implement the new best price”. Becker’s Hospital Review notes that drugmakers sued the U.S. Department of Health and Human Services over the best price rule in the U.S. District Court for the District of Columbia last week.

Read the full rule at the Federal Register.