News in brief - Aug. 28, 2006

Medicare proposes new ambulatory surgery center rates - Senators aim to postpone imaging cuts - Drugmaker settles pricing suit

Medicare proposes new ambulatory surgery center rates

A recent Medicare rule proposes that ambulatory surgery centers in 2008 start being paid 62% of what hospital outpatient departments receive for the same services. The centers say some of these rates will not be high enough. For some services, this would mean a reduction in the payments that they are getting now, says the Federated Ambulatory Surgery Assn.

"Many ASCs, particularly single-specialty ones, will no longer be viable at these rates," said FASA President Kathy Bryant. The group is supporting legislation that would boost the surgery center rate to 75% of what hospitals receive.

Senators aim to postpone imaging cuts

A bipartisan group of senators recently introduced legislation that would hold off implementation of Medicare cuts for diagnostic imaging that are set to take effect in January. Sens. Jay Rockefeller (D, W.Va.) and Gordon Smith (R, Ore.) authored the bill, which would delay for two years a measure that limits imaging reimbursements to the lesser of the physician fee schedule or hospital outpatient department rates. Congress hoped to save billions of dollars by capping the payments starting in 2007.

Several physician groups, including the American Assn. of Clinical Endocrinologists, the American College of Radiology and the American Society of Clinical Oncology, praised the legislation for aiming to protect doctors and their patients from what are expected to be severe cuts for many types of scans.

A House bill authored by Rep. Michael Burgess, MD (R, Texas), that would overhaul the Medicare physician payment system would delay the imaging reductions for one year.

Drugmaker settles pricing suit

GlaxoSmithKline on Aug. 10 agreed to pay $70 million to settle a nationwide class-action lawsuit on behalf of individuals and health plans who accused the pharmaceutical company of artificially inflating the average wholesale price of certain drugs, including cancer medications.

GSK also settled Medicaid fraud claims with the attorneys general in Arizona, California, Connecticut, Montana, Nevada and New York. Government and private insurers use the average wholesale price to set reimbursement rates for doctors and pharmacies to buy and dispense drugs. The states and other plaintiffs contended that GSK inflated the prices, resulting in overpayments. The drugmaker admitted to no wrongdoing in the agreement.