{"id":7619,"date":"2025-08-19T01:37:31","date_gmt":"2025-08-19T01:37:31","guid":{"rendered":"https:\/\/medical-article.com\/?p=7619"},"modified":"2025-08-19T01:37:31","modified_gmt":"2025-08-19T01:37:31","slug":"impact-of-medicare-part-b-on-pharmaceutical-price-growth","status":"publish","type":"post","link":"https:\/\/medical-article.com\/?p=7619","title":{"rendered":"Impact of Medicare Part B on pharmaceutical price growth"},"content":{"rendered":"

Does Medicare Part B increase or decrease the prices of physician-administered drugs relative to physician-administered drugs covered by private insurance? That is the question a paper by Acquatella, Ericson and Starc (2023)<\/a> aim to answer. <\/p>\n

Before we answer that question, we first need to understand how Part B works, how physicians are reimbursed, and how much Medicare beneficiaries have to pay<\/strong>: <\/p>\n

\u201cPart B has a buy-and-bill policy, in which physicians purchase drugs (either on their own, or as part of a group purchasing organization)\u2026The provider pays a price to the manufacturer that is averaged to construct an average sales price (ASP). The provider is then typically reimbursed at lagged ASP times a multiplier, here 106% the ASP from two quarters ago. The out-of-pocket costs for the patient are 20% of the reimbursed amount in the form of coinsurance; the Medicare program covers the remaining 80%.<\/p>\n

How do the authors identify the impact of Part B on drug prices?<\/strong><\/p>\n

Our identifying variation comes from drugs that are more or less exposed to Part B: the share of expenditures for a drug that comes via Medicare Part B, as opposed to private insurers. A similar research design is used by Yurukoglu et al. (2017)<\/a>\u2026<\/p>\n

What data do they use?<\/strong><\/p>\n

We construct a sample of prices and Medicare market shares for physician-administered drugs spanning 2006 through 2019. Our unit of analysis is the drug-quarter, where drugs are uniquely identified by Health Care Procedure Coding System (HCPCS) codes. We combine data from three sources: pricing files, aggregate Medicare claims, and Truven Marketscan spending aggregates\u2026.We obtain Medicare\u2019s aggregate drug payments from the CMS Part B National Summary Data File, which contains yearly data on aggregate payments for each HCPCS code in by Part B. We obtain aggregate private drug payments at the HCPCS-year level using Truven MarketScan data for each year.<\/p>\n

Using this approach, what are the authors results?<\/strong><\/p>\n

Drugs more exposed to Medicare have lower price growth. A drug with above median Part B exposure has a 10% lower price after 3 years than a below median exposure drug that launched at the same price, with a larger effect for newly approved molecules.<\/p>\n

You can read the full paper here<\/a><\/strong>.<\/p>","protected":false},"excerpt":{"rendered":"

Does Medicare Part B increase or decrease the prices of physician-administered drugs relative to physician-administered drugs covered by private insurance? That is the question a paper by Acquatella, Ericson and Starc (2023) aim to answer. Before we answer that question, we first need to understand how Part B works, how physicians are reimbursed, and how…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-7619","post","type-post","status-publish","format-standard","hentry","category-articles"],"_links":{"self":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/posts\/7619"}],"collection":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7619"}],"version-history":[{"count":0,"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/posts\/7619\/revisions"}],"wp:attachment":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7619"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7619"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7619"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}