CMS Establishes New Rules for Payment of COVID-19 Vaccine

On October 28, 2020, the Centers for Medicare & Medicaid Services (CMS) issued an interim final rule with a comment period, the fourth such issuance during the COVID-19 public health emergency, in anticipation of vaccine availability in the near future. Effective immediately, these provisions will continue through the duration of the emergency.

COVID-19 Vaccine

The Coronavirus Aid, Relief, and Economic Security (CARES) Act established Medicare Part B coverage and payment for the COVID-19 vaccine and its administration. The interim rule authorizes Part B coverage for all vaccines that receive approval by the FDA or an Emergency Use Authorization by the Commissioner of Food and Drugs. Any such vaccine, and its administration, will be added to the list of preventive vaccines covered under Part B without coinsurance or deductible.

The interim rule also includes provisions for implementing the CARES Act requirement that non-grandfathered group health plans, as well as health insurance issuers offering non-grandfathered group or individual health insurance coverage, must provide coverage, without cost sharing, for qualifying COVID-19 preventive services including vaccines, regardless of whether an in-network or out-of-network provider delivers the services. State Medicaid and CHIP programs, too, must provide COVID-19 vaccines and their administration for most beneficiaries without cost sharing.

To mitigate potential financial disincentives for hospitals to provide innovative COVID-19 treatment, the interim rule provides enhanced payments for eligible inpatient cases where certain new authorized or approved products are used. The enhanced payment will equal the lesser of 65% of the operating outlier threshold for the claim OR 65% of the cost of a COVID-19 stay beyond the operating Medicare payment (including the 20% add-on payment under Section 3710 of the CARES Act) for eligible cases.

COVID-19 Treatment

Similarly, the CMS will incentivize the use of new COVID-19 treatments provided in hospital outpatient settings. For the duration of the public health emergency, the CMS will exclude FDA authorized or approved drugs and biologicals that treat or prevent COVID-19 from being packaged into the Comprehensive Ambulatory Payment Classification (C-APC) payment when these treatments are billed on the same claim as a primary C-APC service. Instead, such drugs and biologicals may be billed and will be paid by Medicare separately.

In response to the CARES Act requirement for price transparency, the CMS added a new rule applicable to every provider of a COVID-19 diagnostic test, which is codified at 45 C.F.R. Part 182. Each provider must publish on its website the cash price, defined as the charge that applies to an individual who pays cash (or cash equivalent) for a COVID-19 diagnostic test. Any provider that does not have its own website must make the cash price available in writing within two business days, upon request, and through signage (if applicable). If the CMS determines that a provider is non-compliant, it may:

• Provide a written warning;
• If compliance does not occur after the warning, solicit a corrective action plan from the provider; and
• Ultimately impose a civil monetary penalty in the event of a failure to submit, or comply with, a corrective action plan.

If you have any questions or would like assistance to better understand any of the CMS rules, please contact plehr@norris-law.com. For more topics related to COVID-19, visit our Coronavirus Thought Leadership Connection.

The information contained in this post may not reflect the most current developments, as the subject matter is extremely fluid and constantly changing. Please continue to monitor this site for ongoing developments. Readers are also cautioned against taking any action based on information contained herein without first seeking advice from professional legal counsel.