Medicare Part B Drugs: Pricing and Incentives


Medicare Part B covers infusible and injectable drugs and biologics administered in physician offices and hospital outpatient departments; as well as certain other drugs required by law provided by suppliers such as pharmacies The Part B payment method provides weak incentives for physicians to consider value – that is choose the lowest cost therapy to effectively treat a patient. Moreover, the Medicare program has not implemented various value based practices typically used by commercial insurers and Part D sponsors for self-administered drugs.


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