2006 proposed fee schedule - American Society of Clinical Oncology

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section 1847A of the Act for the drug, as the Secretary may
specify. In the report entitled, “Medicare Reimbursement
for Existing End Stage Renal Disease Drugs,” the OIG
obtained the drug acquisition costs for the top 10 ESRD
drugs for the 4 largest ESRD chains as well as a sampling of
the remaining independent facilities. Based on the
information obtained from this report, for CY 2005, payment
for the top 10 ESRD drugs billed by freestanding facilities
and payment for EPO billed by hospital-based facilities was
based on acquisition costs as determined by the OIG. Due to
the lag in the data obtained by the OIG, we updated the
acquisition costs for the top 10 ESRD drugs to 2005 by the
PPI. The separately billable ESRD drugs not contained in
the OIG report were paid at the ASP +6 percent for
freestanding facilities. The payment allowances for these
remaining drugs were updated on a quarterly basis during
2005.
Section 1881(b)(13)(A)(iii) of the Act gives the
Secretary the authority to establish the payment amounts for
separately billable ESRD drugs beginning in 2006 based on
acquisition costs or the amount determined under section
1847A of the Act. For reasons discussed below, we do not
believe that it is appropriate to continue to use 2002
acquisition costs updated by the PPI for another year as the
basis for payment. The acquisition costs are based on 2002