Medicare may experiment with caps to Cancer-drug reimbursements

The U.S. is mulling changes to how the Medicare program pays physicians for administering expensive cancer drugs and other medications given in doctors’ offices, according to a memo from the Centers for Medicare and Medicaid Services.
The memo tells Medicare contractors who process payments to set up a system allowing the government to vary by geographic location how much it reimburses doctors for the drugs they administer. The government could then set up a pilot program to test how limiting reimbursement in Medicare Part B, which pays for seniors’ medical services and supplies, affects doctors’ choice of drugs. Medicare typically pays doctors a drug's average sales price, plus an added 6%, for treatments they administer in their offices, including cancer infusion therapies and pricey new products whose price tags can exceed $100,000 a year. The current reimbursement system "does not take into account the effectiveness of a particular drug, or the cost of comparable drugs, when determining the Medicare payment amount."
Those factors are regularly looked at by countries around the world when it comes to government drug coverage. In the U.K., for instance, manufacturers often have to offer up discounts to get their new treatments past cost-effectiveness gatekeepers. Germany's iQWIG requires new therapies to deliver an additional benefit beyond already-available drugs if they want to secure premium pricing.