PRACTICE RESOURCES > Regulation/AUA Positions, Letters, and Talking Points > American Urological Association Comments CMS Forum on Average Sales Price (ASP)


American Urological Association Comments CMS Forum on Average Sales Price (ASP)

Tuesday, April 20, 2004

The American Urological Association is greatly concerned that the mandated rate of ASP plus six percent will result in payments that are well below the actual acquisition cost for some drugs. With the recent 10 percent decrease to the current Average Wholesale Price for the reimbursement of drugs used to treat bladder cancer, the payment made to physicians has already fallen below the cost of purchasing the anti-carcinogenic drugs used for their patients. Overall, bladder cancer is the sixth most common cancer in the United States (the fourth most common for men). About 53,200 Americans are diagnosed with bladder cancer each year and 12,200 people die annually of the disease. In recent decades there has been a steady increase in the incidence of bladder cancer.

The gap between cost and payment is substantial in some cases and most patients will not be able to make up the difference and physicians will be unable to provide care or care will be shifted to the outpatient or inpatient hospital setting. The further reductions anticipated under the ASP system will widen this gap even further. This will cause significant treatment delays because physicians will have no choice but to shift the site of service for these patients. Such change in access will increase patient inconvenience and cost. This can result in patients delaying much need treatment. Bladder cancers that are not treated in a timely or appropriate fashion mean that care and treatment will wait until the cancer and its symptoms are much more aggressive and costly to treat.

Unlike all other drug administration codes, the payment for bladder cancer treatments received no increases for practice expense and no transitional offsets. Further, Government Accountability Office (GAO) reports on impact of these reductions are not due until 2006, two years after implementation and a year after even further reductions will be put into place. H.R. 1 included provisions for drug manufacturers to apply for exceptions to the 10 percent reduction in the Average Wholesale Payment if they could document that such a cut would result in Medicare payments that were lower than the actual cost of the drug. CMS has just released their list of those drugs that would be allowed an exception and none of the bladder cancer drugs were included on that list. The chart below indicates the current allowed Medicare payment rate for these drugs, the reported costs that have been documented to the AUA in verified invoices from member practices, and the drug manufacturer as well as the corresponding J code for each drug.

Medicare Code

Drug name/dose

2004 Cost

2004 Payment

J9340

Thiotepa, 15 mg
(Bedford/Gensia)

$63.00

$83.73

J9280

Mitomycin, 5mg
(Bristol Myers)

$115.00

$57.12

J9290

Mitomycin, 20 mg

$389.24

$185.64

J9291

Mitomycin, 40 mg

$787.00

$255.00

J9031

BDG (Organon)

$150.92

$143.28

 

The AUA is extremely concerned that anticipation of the change in 2005 to the ASP method has encouraged drug companies to retain higher prices for some drugs to avoid lowering the future ASP.

Other points regarding the new Average Sales Price system:

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