GLOBE (Global Benchmark for Efficient Drug Pricing) Model

Americans pay three times what other developed countries pay for the same medications. Spending for Medicare Part B drugs has grown more rapidly than overall national drug spending.

Drugs included in GLOBE would be a subset of Part B rebatable drugs (single source drugs and sole source biological products) that are used to treat people with Medicare with conditions where access barriers, such as high costs, likely contribute to deficits in care leading to poor clinical outcomes and high program expenditures, which may be avoidable. The therapeutic categories that GLOBE would focus on are oncology, rheumatology, immunology, ophthalmology, and endocrinology.

GLOBE would focus on reducing program expenditures for Medicare Part B while preserving or enhancing beneficiaries’ quality of care.

Aims

GLOBE would:

• Reduce out-of-pocket costs for people with Medicare Part B and costs incurred by Medicare.
• Ensure people with Medicare Part B can continue receiving necessary medications to improve their health and quality of care by improving drug affordability.

Innovation

GLOBE would test an innovative payment model that modifies the Medicare Part B inflation rebate amount calculation for GLOBE Model drugs using international drug pricing information to identify a benchmark that reflects prices paid in a set of economically comparable countries.

Design

Under GLOBE:

• CMS would test an alternative calculation for manufacturer rebates under the Medicare Part B Inflation Rebate Program that uses a benchmark derived from international pricing information instead of the current domestic benchmark. The benchmark would be based on either manufacturer-reported international pricing information or available information to CMS for economically similar countries.
• Rebates paid by manufacturers would continue to be sent directly to the Medicare Supplementary Medical Insurance Trust Fund.
• Out-of-pocket costs would be tied to the international benchmark, resulting in reduced drug costs to people covered by Medicare Part B who receive GLOBE Model Drugs.

Participants in the model would be manufacturers of drugs covered by Medicare Part B that are not otherwise excluded from the GLOBE Model.

How would rebates be calculated?

CMS would modify the calculation of the Medicare Part B Drug Inflation Rebate Program Rebate Amount, using a benchmark derived from international pricing information instead of the domestic benchmark.

The benchmark would be based on either manufacturer-reported international pricing information or available information to CMS for countries with a real gross domestic product per capita that is at least 60% of the United States’ and with a minimum real economy size of $400 billion.

What medications would be covered by the model?

GLOBE would include a subset of separately payable Medicare Part B covered drugs that meet the statutory definition of a Part B rebatable drug which include outpatient drugs and biologicals provided as part of a physicians’ service, and drugs that are not usually self-administered. GLOBE Model drugs would be a subset of Part B rebatable drugs that: (1) have the following listed USP DC categories: Antigout Agents, Antineoplastics, Blood Products and Modifiers, Central Nervous System Agents, Immunological Agents, Metabolic Bone Disease Agents, Ophthalmic Agents; (2) are single source drugs or sole source biological products; (3) have a HCPCS Level II code with Medicare Part B FFS spending greater than $100 million over a 12-month period; and (4) are not excluded from the GLOBE Model due to having a maximum fair price in effect or meeting other exclusion criteria specified in the NPRM.

Where would GLOBE operate?

The model would be implemented in selected geographic areas representing 25% of the country’s Medicare Part B beneficiaries.

Would this model qualify as an Advanced or Merit-based Incentive Payment System Alternative Payment Model (MIPS APM)?

No, health care providers would not be participants in the model and therefore it would not qualify as an Advanced or MIPS APM under the Quality Payment Program.

• Press Release: GLOBE Model
• Notice of Proposed Rulemaking