BIO Comments on the CY 2014 Hospital Outpatient Prospective Payment System Proposed Rule



September 6, 2013




Marilyn Tavenner


Centers for Medicare & Medicaid Services

Department of Health and Human Services

Room 445-G

Hubert H. Humphrey Building

200 Independence Avenue, S.W.

Washington, D.C. 20201


Re:  Medicare and Medicaid Programs: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Hospital Value-Based Purchasing Program; Organ Procurement Organizations; Quality Improvement Organizations; Electronic Health Records (EHR) Incentive Program; Provider Reimbursement Determinations and Appeals [CMS-1601-P]


Dear Administrator Tavenner:


          The Biotechnology Industry Organization (BIO) appreciates this opportunity to comment on the Centers for Medicare & Medicaid Services’ (CMS) proposed rule regarding payment policies under the calendar year (CY) 2014 hospital outpatient prospective payment system (OPPS), published in the Federal Register on July 19, 2013 (the “Proposed Rule”). BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers, and related organizations in the United States.  BIO members are involved in the research and development of health care, agricultural, industrial, and environmental biotechnology products. 


BIO represents an industry that is committed to improving health care through the discovery of new therapies.  We recognize that appropriate reimbursement based on an accurate payment methodology is critical to ensuring that beneficiaries are able to access necessary care.  An accurate payment methodology also fosters continued investment in innovation.  Accordingly, BIO strongly supports CMS’s proposal to continue reimbursing separately payable drugs and biologicals at average sales price (ASP) plus six percent in CY 2014.  BIO believes it provides the predictable, appropriate payment rates necessary to ensure that beneficiaries will continue to have access to critical therapies in the hospital outpatient setting.  Until CMS develops a methodology to more accurately and predictably estimate acquisition and overhead costs involved in furnishing these therapies – a goal BIO looks forward to helping the agency pursue, CMS should continue to reimburse these drugs and biologicals at the statutory default of ASP plus six percent.  BIO urges CMS to finalize this proposal.  We are concerned, however, that the agency’s proposal to expand packaging for drugs, biologicals, and radiopharmaceuticals based on their purported function and cost and to package payment for many drug administration services will counteract this and other improvements in payment that CMS has achieved in recent years.  As discussed in depth below, we ask that the agency reconsider those proposals.

Click here to view the comment letter in its entirety.