Latebreakers: Judge rules against AMP

January 14, 2008

A Judge has issued an injunction halting the implementation of the new AMP payment formula for Medicaid.

Atemporary injunction has stopped the Centers for Medicare & Medicaid Services from implementing the average manufacturer price (AMP) rule for Medicaid generic drug reimbursement. In a December hearing, Judge Royce Lamberth granted the injunction after concluding that the case filed by NCPA and NACDS was likely to succeed and that "implementation of this scheme would, in fact, put [pharmacies] out of business." In the suit, NACDS and NCPA charged that CMS had exceeded its mandate from the Deficit Reduction Act and that CMS had contradicted numerous aspects of the Social Security Act, including its definition of AMP. The order blocks CMS from implementing the new rule as well as posting AMP data on its Web site. The case will go to trial beginning in January. Officials at NCPA and NACDS are still hoping for a legislative fix for the AMP rule.