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Effects of Including Noncovered Versions of Stelara Biosimilars in Part B Payment Amount Calculations

Announced on  | Last Modified on  | Project Number: OEI-BL-25-00240
Status
Completed
Agency
Centers for Medicare and Medicaid Services

OBJECTIVE

Under the Consolidated Appropriations Act, 2021, Congress required OIG to periodically conduct studies to identify drugs for which noncovered self-administered versions are included in Medicare Part B payment amount calculations, and to determine whether they should be excluded from Part B payment amount calculations. The FDA has recently approved seven biosimilar drugs for Stelara (ustekinumab), a high-cost prescription biologic drug approved to treat certain autoimmune diseases. The intravenous versions of these drugs are administered by a health care provider and are covered by Medicare Part B. Conversely, the subcutaneous versions are typically self-administered and not covered under Medicare Part B. The provider-administered intravenous versions for five of these biosimilars were each approved under the same application number as their self-administered subcutaneous versions. Under CMS policy, both versions will therefore be included when calculating each drug’s Part B payment amount. OIG will determine the effect of including noncovered self-administered versions of Stelara biosimilar drugs in Part B payment amount calculations.

TIMELINE

  • June 16, 2025
    Announced
  • December 12, 2025
    Complete

    Effects of Including Noncovered Versions of Stelara Biosimilars in Part B Payment Amount Calculations has been marked as complete. Report Published

REPORT PUBLISHED

Excluding Noncovered Versions Would Have Substantially Lowered Fourth-Quarter 2025 Part B Payment Amounts for Stelara Biosimilars (OEI-BL-25-00240)

Medicare Part B billing codes for five Stelara biosimilars currently include both covered and noncovered versions. In accordance with CMS policy, these five Stelara biosimilars were each assigned a single billing code that represents both the covered provider-administered and noncovered self-administered versions. A sixth biosimilar has not yet been assigned a dedicated billing code; however, once assigned, the billing code will also include both covered and noncovered versions.

Payment amounts for four Stelara biosimilars included noncovered self-administered versions in the fourth quarter of 2025. Medicare Part B generally pays for qualifying biosimilars using a two-part formula: (1) the biosimilar’s volume-weighted average sales price (i.e., ASP portion) and (2) 8 percent of the reference product’s ASP (i.e., add-on portion).

  • ASP Portion. For three biosimilars, CMS included both covered and noncovered versions in the ASP portion of their calculations. For the fourth biosimilar, CMS included only the covered version in its ASP calculation.
  • Add-on Portion. CMS included the ASPs for the covered and noncovered versions of the reference product (Stelara) in all four biosimilars’ add-on calculations—even though the self-administered version of Stelara is not covered under Part B.

ASP data were not available for two of the six biosimilars, meaning their payment amounts were not yet affected.

Excluding noncovered versions would have lowered fourth-quarter 2025 payment amounts for four Stelara biosimilars by 59 to 87 percent—up to $3,765 in savings per vial. Because noncovered versions were included, four Stelara biosimilars had fourth-quarter 2025 payment amounts that were considerably higher than they would have been otherwise. In one case, this resulted in a payment of $5,245 per vial, more than triple that of Stelara ($1,689 per vial).

No recommendations were issued as a part of this report.
Work Plan Type
Office of Evaluation and Inspections
HHS Agencies
Centers for Medicare and Medicaid Services
Issue Areas
Financial Stewardship OIG Statutory Authority and Regulatory Matters Prescription Drug
Target Groups
Elderly
Financial Groups
Medicare B