CMS rule would offer an alternative for obtaining drugs administered in the office

March 2, 2005

Urologists and other physicians who administer drugs in their offices may have a new option for obtaining the drugs under a proposed rule by the Centers for Medicare & Medicaid Services.

Urologists and other physicians who administer drugs in their offices may have a new option for obtaining the drugs under a proposed rule by the Centers for Medicare & Medicaid Services.

Under the proposed rule, physicians could choose to obtain physician-administered Part B drugs from competitively selected vendors, who would then bill Medicare directly. Alternatively, physicians could continue to purchase drugs directly in the market, as they do now, and be paid directly by Medicare.

"This proposed competitive alternative program offers physicians an option that could save them time and paperwork, while creating a competitive environment for the acquisition of Part B drugs," said CMS Administrator Mark McClellan, MD, PhD.

The proposed rule would give physicians an opportunity once a year to elect to participate in the program and to choose a vendor to be the physician's sole source for the selected categories of Part B drugs. The rule would allow physicians to obtain drugs elsewhere under specified emergency circumstances.

For administering Part B drugs, a physician who obtained drugs from a vendor would receive the same Medicare payment as a physician who purchased the drugs in the market. The physician would not bill Medicare for drugs but would bill Medicare for administration services only.

A vendor wishing to participate in the competitive acquisition program would have to submit a bid to Medicare for supplying drugs administered in a physician's office.

The competitive acquisition provision, required by the Medicare Modernization Act of 2003, will become available for services beginning on or after Jan. 1, 2006. Comments about the proposed rule will be accepted until April 26.

For more on reimbursement and coding for drugs administered in the office, watch for Dr. Ray Painter's "Coding and Reimbursement" column in the March issue of Urology Times.