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Comparison of Average Sales Prices to Average Manufacturer Prices Mandatory Review

In 2005, Medicare began paying for most Part B drugs using a new methodology based on the average sales prices (ASP). The enabling law required that OIG compare ASPs with average manufacturer prices (AMP) (Social Security Act § 1847A(d)(2)(B). Pursuant to the requirement, OIG conducts such reviews and issues quarterly and annual reports of its findings. When OIG finds that the ASP for a drug exceeds the AMP by a certain threshold (5 percent), OIG notifies the HHS Secretary, who may disregard the ASP for the drug when setting reimbursement amounts, e.g., apply a price substitution policy. We will review Medicare Part B drug prices by comparing ASPs to AMPs and identify drug prices that exceed a designated threshold.

Announced or Revised Agency Title Component Report Number(s) Expected Issue Date (FY)
Nov-16 Centers for Medicare & Medicaid Services Comparison of Average Sales Prices to Average Manufacturer Prices Mandatory Review Office of Evaluation and Inspections OEI-03-16-00540, OEI-03-17-00360; OEI-00-00-0000 2017

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