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CMS Hikes Payment for COVID-19 Inpatients Treated With New Drugs, Links it to 20% Bonus

CMS said Oct. 28 that Medicare will pay hospitals extra when they treat inpatients with drugs or biologicals approved by the Food and Drug Administration (FDA) for COVID-19. The additional payments are linked to the 20% bonus hospitals already receive for COVID-19 MS-DRGs, and both require proof of a positive COVID-19 test, according to the fourth interim final rule with comment period (IFC).[1] CMS also raised the specter of post-payment reviews.

Hospitals will receive an additional payment when treatment includes Veklury (remdesivir) or COVID-19 convalescent plasma to treat patients diagnosed with COVID-19. Like a new technology add-on payment, the cost of the drug won’t be entirely folded into the MS-DRG.

The only hitch is hospitals must ensure they make a connection to the Medicare bonus for COVID-19 inpatients, said attorney Daniel Hettich, with King & Spalding in Washington, D.C. “You have to be eligible for the 20% add-on to get the new therapeutic add-on,” he said. “If you don’t have a positive test, you don’t qualify for the new treatment add-on payment.”

The interim final rule, which implements section 3713 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, also said Medicare, Medicare Advantage (MA) and commercial payers must offer FDA-approved vaccines free to patients. Medicare and MA will pay hospitals, physicians, pharmacists and others a fee for the administration of the vaccine and a fee for the vaccine itself. A provision in the Affordable Care Act that requires coverage of preventive care without cost sharing provided a “pathway” to sweep in private payers, said Valerie Rinkle, president of Valorize Consulting. CMS also revised the Comprehensive Care for Joint Replacement model because of the public health emergency (PHE).

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