Temporary Increase in Medicare Part B Payment for Certain Biosimilar Biological Products
Under section 11403 of the Inflation Reduction Act, Medicare payment for certain biosimilar biological products is required to be the average sales price (ASP) plus 8 percent (rather than 6 percent) of the ASP of the reference biological for a 5 year period defined in the statute. For existing qualifying biosimilar biological products for which payment was made using ASP as of September 30, 2022, the applicable 5-year period begins on October 1, 2022. For new qualifying biosimilar biological products for which payment is first made using ASP between October 1, 2022 through December 31, 2027, the applicable 5-year period begins the first day of the calendar quarter of such payment. A qualifying biosimilar biological product is defined as a biosimilar with an ASP that is not more than the ASP of the reference biological.
In accordance with these provisions, the ASP Drug Pricing File reflects the temporary increased amount for qualifying biosimilar biological products for a period of 5 years beginning with the October 2022 file.
Manufacturer reporting of Average Sales Price (ASP) data
Section 401 of the Consolidated Appropriations Act (CAA), 2021 amended section 1847A of the Social Security Act (the Act) to add new section 1847A(f)(2) of the Act, which requires manufacturers without a Medicaid drug rebate agreement to report average sales price (ASP) information to CMS for calendar quarters beginning on January 1, 2022, for drugs or biologicals payable under Medicare Part B and described in sections 1842(o)(1)(C), (E), or (G) or 1881(b)(14)(B) of the Act, including items, services, supplies, and products that are payable under Part B as a drug or biological. This is discussed in further detail in the Physician Fee Schedule 2022 Final Rule.
Such manufacturers should first report ASP data to CMS for calendar quarters beginning on January 1, 2022. As stated in 42 CFR § 414.804 (which is based on statutory language), the “manufacturer's average sales price must be calculated by the manufacturer every calendar quarter and submitted to CMS within 30 days of the close of the quarter.” Therefore, manufacturers first reporting ASP data to CMS in accordance with provisions in section 401 of the CAA, 2021 should do so no later than April 30, 2022 (within 30 days of the close of the first quarter of 2022) for the July 2022 ASP Drug Pricing File.
For instructions regarding ASP reporting, please see the Medicare Part B Drug ASP User Manual, Tips for Successful ASP submission, and visit https://portal.cms.gov to register for the online portal system. Other helpful links are available below.
HCPCS Codes for Which ASP Reporting Is Done in Units of Measure Other Than an NDC
A list of drugs that must be reported in units other than NDCs is posted in the Downloads section. More information is available in the 2012 physician fee schedule final rule (76 FR 73296-8, November 28, 2011).
Medicare Contractor Reporting Template for Medicare Part B Drugs - (Located in the "Downloads" section below)
As indicated in CR 4140, dated February 15, 2006, Medicare contractors shall use the Medicare Contractor Reporting Template for Part B drugs to report information on all Medicare Part B drugs not paid on a cost or prospective payment basis when payment limits are not listed in the quarterly drug pricing files, or in the OPPS Pricer. Contractors shall also use the template to report pricing information for the NOC drug billing codes. This information must be sent to CMS on a monthly basis to e-mail address: email@example.com.
Information Regarding Medicare Payment and Coding for Drugs and Biologics (See Downloads section below for additional information)
Section 303(c) of the Medicare Modernization Act of 2003 (MMA) revised the payment methodology for Part B covered drugs that are not paid on a cost or prospective payment basis. In particular, section 303(c) of the MMA amended Title XVIII of the Act by adding section 1847A, which established a new average sales price (ASP) drug payment system. Beginning January 1, 2005, drugs and biologicals not paid on a cost or prospective payment basis will be paid based on the ASP methodology, and payment to the providers will be 106 percent of the ASP. There are exceptions to this general rule which are listed in the Medicare Claims Processing Manual, Pub. 100-04, Chapter 17. The ASP methodology uses quarterly drug pricing data submitted to the CMS by drug manufacturers. CMS will supply contractors with the ASP drug pricing files for Medicare Part B drugs on a quarterly basis.
Newly Approved Drugs and Biologicals
The Affordable Care Act amends the Public Health Service Act (PHS Act) to create an abbreviated licensure pathway for biological products that are demonstrated to be “biosimilar” to or “interchangeable” with a Food and Drug Administration (FDA)-licensed biological product. CMS will incorporate biosimilars that are approved under the abbreviated biological approval pathway into the Average Sales Price payment methodology, and issue additional guidance as necessary. Questions and answers can be found in MLN Matters® Special Edition Article SE1509 (PDF).
New ASP Data Collection System
The ASP Data Collection System began collecting Average Sales Price data for Part B drugs on April 1, 2019. Please visit https://portal.cms.gov to register for the system. The ASP Data Collection System User Guide can be found in the links below as well as the new data templates that must be used within the system.
If you have questions, please contact firstname.lastname@example.org. Thank you for you cooperation.
Tips for Successful ASP Data Submission (PDF)
ASP Data Collection Form (Addendum A) – Revised 2018 (ZIP)
2007 Information Regarding Medicare Payment and Coding for Drugs and Biologics (PDF)
ASP Certification Form (Addendum B) – Revised 2018 (PDF)
4/25/07 -Update to Information Regarding Medicare Payment and Coding for Drugs & Biologics (PDF)
5/18/07 - Update to Information Regarding Medicare Payment and Coding for Drugs and Biologics (PDF)
Medicare Contractor Reporting Template for Medicare Part B Drugs (ZIP)
ASP Data Collection (Addendum A) User’s Guide - Revised 2012 (PDF)
Medicare Part B ASP Data Collection User Guide (PDF)
Medicare ASP Financial data template-for New System (ZIP)
"JW" Modifier FAQs (PDF)
Medicare ASP Product data template-for New System (ZIP)