Press Releases

CMS: Innovative treatments call for innovative payment models and arrangements

CMS: Innovative treatments call for innovative payment models and arrangements

With today’s U.S. Food and Drug Administration (FDA) approval of Kymriah (tisagenlecleucel) for certain pediatric and young adult patients with B-cell precursor acute lymphoblastic leukemia (ALL) that is refractory or in second or later relapse, the Centers for Medicare & Medicaid Services (CMS) is continuing to explore the development of payment models and arrangements for new and potentially life-saving treatments.

“CMS congratulates all of the scientists and researchers involved in the development of Kymriah (tisagenlecleucel),” said CMS Administrator Seema Verma. “Innovations like this reinforce our belief that current healthcare payment systems need to be modernized in order to ensure access to new high-cost therapies, including therapies that have the potential to cure the sickest patients. Improving payment arrangements is a critical step towards fulfilling President Trump’s promise to lower the cost of drugs.”

As part of larger efforts to support the President’s priority, CMS is working actively with all stakeholders, including state officials, on innovative payment arrangements. These arrangements may, for example, include outcome-based pricing for medicines in relation to clinical outcomes. CMS will be issuing future guidance to explain how pharmaceutical manufacturers can engage in innovative payment arrangements and will continue to work with states on other options, as well help them manage the cost of new therapies and cures.

CMS is committed to further exploring the development of innovative pricing systems that reflect the value delivered to patients. Through the authority provided to the Center for Medicare and Medicaid Innovation (CMMI), CMS will aim to identify and alleviate regulatory barriers in Medicare and Medicaid as may be necessary to test payment and service delivery models that involve value-based payment arrangements.

Medicare and Medicaid policies should create incentives for achieving better health results at lower costs. Through flexibility and program simplification, we are working to preserve incentives for innovation while increasing access to high-value and efficiently-provided care.