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CMS giveth, taketh away

While the government's new Medicare reimbursement plan makes some concessions to industry's unhappiness with last year's maiden rule, the 2004 Outpatient Prospective Payment System draft rule still provides no absolute remedy to objections over coverage of orphan drugs, the concept of "functional equivalence" and concerns about patient access.
In a win-loss situation for orphan drugs, the Centers for Medicare & Medicaid Services is set to cover additional orphan treatments. But it now proposes to pay for them under an OPPS payment structure that industry and patient groups say makes it impossible for hospitals to recoup their costs.
At the same time, CMS has acknowledged the difficulty of comparing the effectiveness of drugs and biologics. But it has offered no immediate remedy to industry's frustrations with the use of functional equivalence. Until it is convinced otherwise, the agency proposes to continue reimbursing Amgen Inc.'s Aranesp darbepoetin alfa at the same rate as Johnson & Johnson's Procrit eopoetin alpha, despite legal and legislative efforts to reverse the policy.
The OPPS rule, which sets reimbursement prices and policies for drugs used by Medicare beneficiaries in the outpatient hospital setting, has been attacked by industry and patient groups for limiting patient

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