Drug Pricing Information

by  Christine Woolstenhulme, QMC QCC CMCS CPC CMRS
Apr 25th, 2016 - Reviewed/Updated Aug 7th

Single Drug Pricer (SDP): Effective January 1, 2003, contractors pay drug claims on the basis of the prices shown on the SDP files, if present, SDP includes the HCPCS Drug pricing file. 

Part B Drug pricing is the payment amounts that will be used to pay for Part B covered drugs.   The payment amounts can be paid to the provider or directly to the Beneficiary depending on how the claim was filed. 

This is the maximum Medicare Part B will pay.  This is not Part D coverage.   (Part D is for Rx - Drug coverage for Beneficiaries). 

ASP Drug pricing:  Included the vast majority of drugs and biologicals not priced on a cost or prospective payment basis will be priced based on the average sales price (ASP) methodology.

• Beginning in July 2015, claims for compounded drugs shall be submitted using a compounded drug, not otherwise classified (NOC) HCPCS code.

• The payment allowance limits for drugs and biologicals that are not included in the ASP Pricing for compounded drugs is performed by the local contractor.

• Medicare Part B Drug Pricing File or Not Otherwise Classified (NOC) Pricing File, other than new drugs that are produced or distributed under a new drug application (or other application) approved by the Food and Drug Administration, are based on the published Wholesale Acquisition Cost (WAC) or invoice pricing, except under OPPS where the payment allowance limit is 95 percent of the published AWP.

ESRD drugs furnished by both independent and hospital - based ESRD facilities, as well as specified covered outpatient drugs, and drugs and biologicals with pass -through status under the Outpatient Prospective Payment System(OPPS), will be priced based on the ASP methodology.