The $100 billion policy worrying hospitals this year

It's not often that a policy saves the federal government a whole lot of money, saves patients money, and also enjoys bipartisan support. But one Medicare payment policy may be just the unicorn that lawmakers are looking for as they debate the future of the Medicare program this year.

So-called site-neutral payment policy would equalize payment for Medicare services regardless of where they're provided. It could save the federal government more than $100 billion, if lawmakers are willing to pursue the most aggressive forms of the policy. Insurers are on board pushing for the changes, and states are also pursuing legislation to crack down on hospitals charging extra fees.

Hospitals obviously despise the idea, and argue that it costs more overhead to run a hospital and hospitals face more stringent requirements, so they should be able to charge more. Read more about the policy in my new story out this morning.

drug pricing

Medicare explains its drug negotiation process

Adobe

Medicare laid out Wednesday in the greatest detail yet how it will choose which drug prices it will negotiate in its brand-new program. The full document is 91 pages long.

CMS clarified that it's going to rank drugs for selection based on the gross spending in the Medicare program, and will choose the top 10 drugs (that don't qualify for exemptions, of course). The agency will use net prices of drugs in the same therapeutic class to help determine CMS' initial offer once the negotiation process has started.

Analysts were also buzzing last night about drugs that may be included in or excluded from the program based on revelations in the guidance. Read my breakdown of the announcement here.

The Pandemic

Will the FDA allow another round of boosters?

While regulators in the United Kingdom and Canada have allowed spring booster shots for people at high risk of getting severely sick from Covid, the FDA has offered radio silence, my colleague Helen Branswell reports.

When Helen pressed the agency, they sidestepped most of her questions, declined to make Peter Marks, director of the FDA's Center for Biologics Evaluation and Research, available for an interview, and gave her a statement saying that the agency will continue to monitor available data.

Read Helen's full dispatch about what other countries are doing and some experts' mixed opinions over whether another round of boosters are truly needed.

drug pricing

The first fines for hiking drug prices

This week, Medicare officials unveiled the first 27 drugs that are going to incur penalties because price hikes on the drugs outpaced inflation.

The list included AbbVie's blockbuster rheumatoid arthritis drug Humira, and a few repeat offenders. Pfizer had the most, with five drugs on the list, and Gilead, Endo, Leadiant Biosciences, and Kamada had two drugs each. PhRMA pointed out that the Part B program covers around 750 drugs, so the vast majority of medicines didn't see price hikes that outpaced inflation.

While actual fines won't actually be charged until 2025, the drugmakers on the list will still have to pay for their price hikes taken in 2023. If you're interested in more detail about how the rebates will be calculated, read up here.

congress

Epic heads to the Hill

This morning, the Senate Committee on Homeland Security and Governmental Affairs is holding a hearing about cybersecurity risks to the health care sector. Witnesses include Stirling Martin, Epic's senior vice president and chief privacy and security officer, Scott Dreesen a senior vice president at Corewell Health, a health system based in committee chair Sen. Gary Peters' home state of Michigan.

More around STAT

Check out more exclusive coverage with a STAT+ subscription

Read premium in-depth biotech, pharma, policy, and life science coverage and analysis with all of our STAT+ articles.

What we're reading

HHS chooses a location for ARPA-H — sort of, STAT
Conservative Texas judge weighs challenge to abortion pill, Associated Press
PhRMA chief dings health insurers over drug prices at their own conference, STAT
Claims against one Shattuck surgeon raise questions about state care for prisoners, GBH
Momentum grows to subject medical devices to medicine's gold standard — the placebo treatment, STAT