CMS Pub. 100-04, ch. 17, § 20.1.3

The payment limits for blood and blood products (other than blood clotting factors) that are not paid on

a reasonable charge or prospective payment basis, are determined in the same manner the payment

limits were determined on October 1, 2003. Specifically, the payment limits for blood and blood

products are 95 percent of the average wholesale price (AWP) as reflected in the published compendia.

The payment limits will be updated on a quarterly basis. Blood and blood products furnished in the

hospital outpatient department are paid under OPPS at the amount specified for the Ambulatory

Payment Classification (APC) to which the product is assigned.

The payment limits for infusion drugs furnished through a covered item of durable medical equipment

furnished on or after January 1, 2005, and before January 1, 2017, is 95 percent of the AWP reflected in

the published compendia as of October 1, 2003, unless the drug is compounded or the drug is furnished

incident to a professional service. The payment limits for infusion drugs furnished through a covered

item of durable medical equipment before January 1, 2017 that were not listed in the published

compendia as of October 1, 2003, (i.e., new drugs) are 95 percent of the first published AWP unless the

drug is compounded or the drug is furnished incident to a professional service. Payment for infusion

drugs furnished through a covered item of durable medical equipment furnished on or after January 1,

2017 is based on ASP (or other applicable methodology in Sections 1847, 1847A, 1847B or

1881(b)(13) of the Social Security Act).

The payment limits for influenza, pneumococcal, hepatitis B and COVID-19 vaccines are 95 percent of

the AWP as reflected in the published compendia except where the vaccine is furnished in a hospital

outpatient department. Where the vaccine is administered in the hospital outpatient department, the

vaccine is paid at reasonable cost. CMS will supply A/B MACs with the payment limits for influenza

vaccines annually to be effective on August 1 of each year. A/B MACs will be notified of the

availability of payment limits via a Recurring Update Notification. Payment limits for pneumococcal

and hepatitis B vaccines are updated quarterly and are available on the ASP Drug Pricing File.

Payment limits for the COVID-19 vaccines are available on the ASP Drug Pricing File and A/B MACs

will be notified of the payment limits. Payment rates for qualifying OPPS products can be found on the

OPPS Addendum A and Addendum B.

The payment limits for drugs and biologicals that are not included in the ASP Drug Pricing File or Not

Otherwise Classified (NOC) Pricing File, other than new drugs that are produced or distributed under a

new drug application (or other application) approved by the Food and Drug Administration, are based

either on the published Wholesale Acquisition Cost (WAC) or invoice pricing, except under OPPS

where the payment limit is 95 percent of the published AWP if the drug or biological is not included in

OPPS Addendum B. In determining the payment limit based on WAC, the A/B MACs follow the

methodology specified in Publication. 100-04, Chapter 17, Section 20.4 Drugs and Biologicals, for

calculating the AWP, but substitute WAC for AWP. The payment limit is 106 percent of the lesser of the

lowest-priced brand or median generic WAC.

The payment limits for new drugs and biologicals that are produced or distributed under a new drug

application (or other new application) approved by the Food and Drug Administration, that are first sold

on or after January 1, 2005, and that are not included in the ASP Medicare Part B Drug Pricing File or

Not Otherwise Classified (NOC) Pricing File, are based on either (1) the WAC as determined in the

preceding paragraph, or (2) invoice pricing. For claims with dates of service before January 1, 2019,

the add-on percentage for these WAC-based payments is 6 percent. For claims with dates of service on

or after January 1, 2019, the add-on percentage for WAC-based payments determined by MACs for new

drugs before an ASP-based payment limit is available is up to 3 percent. However, in OPPS, the

payment limit for new drugs and biologicals that are not included in OPPS Addendum B is 95 percent

of the published AWP. For claims for biosimilars with dates of service on or after July 1, 2024, the

payment limit for the biosimilar is the lesser of (1) an amount not to exceed 103 percent of the WAC of

the biosimilar or the Medicare Part B drug payment methodology in effect on November 1, 2003, or (2)

106 percent of the lesser of the WAC or ASP of the reference biological, or in the case of a selected

drug during a price applicability period, 106 percent of the maximum fair price of the reference

biological.

The payment limits for radiopharmaceuticals are not subject to ASP. A/B MACs (B) should determine

payment limits for radiopharmaceuticals based on any methodology in place on or prior to November

2003 in the case of radiopharmaceuticals furnished in other than the hospital outpatient department.

Such methodology may include, but is not limited to, the use of invoice-based pricing. Refer to Chapter

17, §90.2 of the manual regarding radiopharmaceuticals furnished in the hospital outpatient department.

MACs shall develop payment limits for drugs separately payable under Part B when CMS does not

supply the payment limit on the ASP drug pricing files (including the Not Otherwise Classified (NOC)

Pricing file). At the A/B or DME MAC’s discretion, a MAC should contact CMS to request payment

limits for drugs not included in the quarterly ASP or NOC files or otherwise made available by CMS on

the CMS Web site. If the payment limit is available from CMS, MACs shall substitute CMS-provided

payment limits for pricing based on WAC, invoice or other applicable pricing methodology. CMS will

provide the payment limits directly to the requesting MAC and/or via posting on the CMS Web site.