CMS Issues Final Rule on Medicaid Program; Misclassification of Drugs, Program Administration and Program Integrity Updates Under the Medicaid Drug Rebate Program

• On Sept. 20, 2024, the Centers for Medicare & Medicaid Services (CMS) issued a final rule on the Medicare Drug Rebate Program (MDRP).

• CMS revised the covered outpatient drug (COD) definition to include an inpatient-administered drug as a COD subject to rebates without the drug being paid for separately. To be considered a COD under these circumstances, the drug must be separately identified on the claim, the inclusive payment must include an amount directly attributable to the drug, and the amount paid that is attributable to the drug must be based on a reimbursement methodology in the state plan.

• State managed care contracts that include PBMs must be transparent about spread pricing.

• Professional dispensing fees must be based on pharmacy cost data, rather than a market-based review.

• CMS is finalizing its proposal to require MCOs to assign and exclusively use a Medicaid-specific Bank Identification Number/Processor Control Number (BIN/PCN) combination and group number on Medicaid managed care beneficiaries’ cards.

• As required by court order, CMS is withdrawing its previous changes to the Average Manufacturer Price (AMP) regulations but stated: “We will continue to explore other ways to protect consumers from accumulator programs that leave vulnerable patient populations with a significant cost-sharing burden once a patient exhausts a manufacturer patient benefit program.”

More on this Topic

• Final Rule

• Fact Sheet

For questions, please reach out to Vicky Jucelin.