Medicare Increase for Monoclonal Antibodies

COVID-19; Medicare

Last week, CMS announced a significant increase in Medicare payment rates for the administration of monoclonal antibodies, one of the most commonly used treatments for COVID-19. Under the revisions, CMS is increasing the national average administration fee from $310 fee to $450 for most health care settings. CMS has also established an even higher national payment rate for infusion in the beneficiary’s home: $750. CMS notes that the higher rate “accounts for increased costs associated with the one-on-one nature of this care model.”

Last year, the Food and Drug Administration (FDA) issued Emergency Use Authorizations (EUA) for the use of several monoclonal antibodies as a treatment for COVID-19. The FDA has since revoked its EUA for Eli Lily’s product bamlanivimab when administered alone, though an EUA is still in place for the combination of bamlanivimab and etesevimab when administered together. 
Monoclonal antibodies are administered via an infusion process. CMS allows a broad range of providers to administer the treatment, including (but not limited to):  

  • ​Freestanding and hospital-based infusion centers
  • Home health agencies
  • Nursing homes
  • Entities with whom nursing homes contract to administer treatment​

CMS surprised some observers last year by announcing that monoclonal antibodies would be paid for as COVID-19 vaccines during the Public Health Emergency. The impact includes:

  • ​No beneficiary cost-sharing – CMS is clear that patients will not be responsible for any cost-sharing (coinsurance or deductible) associated with receiving the product, through the end of the Public Health Emergency (currently expires in July, but likely to be renewed through the end of the year).
  • No provider payment for therapy unless providers purchase – CMS will not pay providers any amount for the product (vs. the services) if the providers receive the product for free. CMS anticipates that providers will receive the product free of charge for some period of time. 
  • Modeled after COVID-19 vaccines – CMS indicates it intends to use the same coverage and payment policies in place for the COVID-19 vaccine. 
    • ​Therapy cost – When providers purchase the therapies they administer, CMS will follow the same methodology used to calculate reimbursement for vaccines under fee-for-service.  For office visits and most outpatient settings, that’s 95% of the Average Wholesale Price of the product.  For outpatient hospital departments, it’s “reasonable cost.”
    • Administration fee – CMS is setting the initial administration fee to providers at approximately $310.  This fee can be geographically adjusted (comparable to rates in Medicare fee schedules now), and is based on one hour of infusion and post-administration monitoring in the hospital outpatient setting.​
CMS indicated last year there would be additional rulemaking coming on payment for monoclonal antibodies, which could be addressed in annual rulemaking for Medicare fee-for-service.