The Centers for Medicare and Medicaid services has announced a change to its present policy on biosimilar reimbursement, stating that it will begin issuing unique Healthcare Common Procedure Coding System (HCPCS) codes (often referred to as “J-codes”) to each individual biosimilar product, beginning on or after Jan. 1.
Currently, Medicare Part B pays for biosimilars under the Physician Fee Schedule (PFS) based on the average sales price (ASP) of all biosimilar products within the same HCPCS code — grouping together all biosimilar products with the same reference product to calculate an ASP. This arrangement has meant that physicians are reimbursed the same amount for all biosimilars of the same reference product.
The coding system for biosimilars is also separate from the coding system for their reference products, so as a biosimilar’s price is reduced, the ASP also declines, as does reimbursement. However, the reference product’s ASP remains unaffected by changes to the biosimilar’s price.