In an attempt to stimulate antibiotic development, the Centers for Medicare & Medicaid Services (CMS) is making changes to the way it reimburses hospitals for antibiotics and treatment of antimicrobial resistance (AMR).
In a blog post in the journal Health Affairs on Friday, CMS administrator Seema Verma, MPH, outlined the changes, which include modifications to the way Medicare pays hospitals for use of new antibiotics and for treating patients with antibiotic-resistant infections. The new Medicare payment policies are being made through the Fiscal Year (FY) 2020 Inpatient Prospective Payment System (IPPS) rule.
Varma said the intention is to remove regulatory barriers and modify a payment structure that undervalues antibiotics and disincentivizes antibiotic innovation. The hope is that increased reimbursement will help compensate for low sales volume of new antibiotics, one of the factors that have led many pharmaceutical companies to abandon antibiotic development.
“AMR is both a public health crisis and a national security imperative that demands systemic policy action,” Verma wrote. “The agency’s realignment of inpatient payment incentives is intended to stabilize the antibiotic development pipeline in the short term and guarantee an arsenal of innovation to fight AMR in the long term.”
Verma said the agency is also considering a rule that would require hospitals to have antibiotic stewardship programs.
Misaligned financial incentives
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