Congress expresses concern over AMP rule

March 5, 2007

Congressional leaders have voiced worry over CMS' plan to implement a new formula for Medicaid generic reimbursement based on the average manufacturer price (AMP). In a letter to Leslie Norwalk, CMS acting administrator, a bipartisan group of 70 Representatives "expressed deep concern" over CMS' new rule, which was proposed in December, calling it "flawed" and insisting that the formula "does not reflect the prices paid by retail pharmacists." The letter asks CMS to "delay the release of any AMP data until a final definition is adopted ensuring that AMP accurately reflects pharmacy acquisition costs." In a separate letter, Sen. Max Baucus (D, Mont.), chairman of the Senate Finance Committee, also asked Norwalk to delay implementation of the rule. In addition, Baucus asked the acting director to explain by Feb. 28 how the rule would be implemented, its impact on use of generic drugs, and CMS' perspective on a recent GAO report that found that the rule would cut pharmacy reimbursement by, on average, 36%.

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