Industry Experts Are Skeptical About Reviving CAP for Part B

Industry Experts Are Skeptical About Reviving CAP for Part B

From RADAR on Drug Benefits

In addition to allowing Medicare Advantage plans to use step therapy for Part B drugs, CMS is mulling another change to Part B: bringing back the Competitive Acquisition Program (CAP), which is an alternative to the "buy-and-bill" model for reimbursement of physician-administered drugs paid for under Part B that allowed providers to procure these drugs through CAP-contracted vendors.

CMS argues that the current reimbursement model, which pays providers the average sales price plus a 6% add-on, can incentivize physicians to furnish higher-cost drugs. The administration wants the Center for Medicare and Medicaid Innovation (CMMI) to test a new, improved version of the CAP in which providers acquire drugs through vendor-administered, value-based agreements with manufacturers.

Industry experts say it's possible that both PBMs and insurers could benefit from the CMS proposal, but they're skeptical the agency will be able to overcome the challenges that led it to shelve a previous iteration of CAP.

That said, "the concept around the CAP program is still valid," says Stephen Cichy, founder and managing director of Monarch Specialty Group, LLC, adding Part B is like a "wild west frontier that has yet to be exposed to significant pharmacy management controls."

In fact, "PBMs stand to gain probably the highest amount of benefit from something like this," according to Cichy. Insurers, too, would likely see a revamped CAP as a net positive, he says, noting that they tend to "follow the government lead with stuff like this."

However, Elan Rubinstein, Pharm.D., a principal at EB Rubinstein Associates, says renewing CAP is a "nonstarter" for CMS because it wouldn't achieve savings, and for specialty pharmacies "because participation would not be profitable."

Cichy also worries that if the government models a CAP-like program on the Competitive Bidding Program that Medicare uses for durable medical equipment, it will further lower reimbursement rates and fragment drug volume.

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