If the Centers for Medicare and Medicaid Services were to revise its current reimbursement policy for biosimilar medicines, the federal government could save $11.4 billion on medicines over the next 10 years, according to an analysis by the Association for Accessible Medicines and its Biosimilars Council.
"The Fiscal Implications of Discrete Codes for Biosimilars" analyzed the budgetary implications of a reversal of the current CMS policy in line with traditional Congressional Budget Office "scoring" methods.
CMS currently groups all biosimilars of a reference biologic under a single billing code and payment rate. But some stakeholders have raised concerns that this policy undermines patient access to affordable biosimilar medicines, and stifles the creation of a robust biosimilars market.
Because of that, the agency is assessing the effects of the current coding and payment policy for biosimilars and has solicited comments on their "Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2018" proposed rule.
Highlighting the need to revise the policy, the report finds that CMS' current reimbursement policy could produce short term savings, but at the expense of larger, long-term savings for Medicare. It contends that the current policy would cause biosimilars manufacturers to exit the market over time or decide not to enter at all, ultimately leading to higher costs for patients.
The Biosimilars Council has urged CMS to revisit their payment and coding policy and provide each non-interchangeable biosimilar for a given reference biologic with a unique billing code and payment rate.
"Shifting biosimilar reimbursement to unique codes increases patient access to more affordable, life-saving medicine and lowers prescription drug spending," said Christine Simmon, executive director of the Biosimilars Council and senior vice president of policy and strategic alliances at AAM, in a statement. "This policy is critical to the development of a thriving biosimilars medicine market."