In 2024, several key federal healthcare regulations and policy developments shaped the landscape of the practice of rheumatology. Spanning a broad range of areas, from health insurance to privacy protections, these regulations aimed to improve access to care, reduce costs and enhance the quality of healthcare services. The changes touch on multiple aspects important to practices, including physician reimbursement, the Inflation Reduction Act, the interchangeability status of biosimilars and more.
Physician Reimbursement
On Nov. 1, 2024, the Centers for Medicare & Medicaid Services (CMS) released the calendar year 2025 Revisions to Payment Policies Under the Physician Fee Schedule (PFS) and Other Revisions to Medicare Part B Final Rule.
This rule includes significant changes to Medicare physician payment and the Quality Payment Program. The 2025 conversion factor is set at $32.3465, a reduction of more than 2.83% from 2024. The CMS also finalized policies related to telemedicine (although extension of COVID-era flexibilities require an act of Congress), the Merit-Based Incentive Payment System (MIPS) and the Medicare Shared Savings Program. Key updates include expansion of the G2211 add-on code for complexity and efforts to move MIPS reporting toward the MIPS Value Pathways by 2029.
In our comments, the ACR supported the provisions related to MIPS and complex biologics, but strongly dissented against CMS’ further cuts to physician reimbursement and its inactivity on telemedicine.
Medicare Drug Price Negotiation
The Inflation Reduction Act of 2022 (IRA), signed into law by President Biden in August 2022, includes several provisions to lower prescription drug costs for people with Medicare and to reduce drug spending by the federal government.
One of the IRA’s key drug-related provisions is a requirement for the Secretary of Health & Human Services to negotiate prices with drug companies for certain drugs covered under Medicare Part D (starting in 2026) and Part B (starting in 2028). In August 2024, the CMS selected the first round of 10 drugs, including Enbrel, whose reduced pricing will take effect in 2026. The list of up to 15 Part D drugs for the second round of price negotiation is due to be announced by Feb. 1, 2025.
The future of the IRA and Medicare Drug Price Negotiation Program is unclear. The Trump Administration will be responsible for administering the program after he is inaugurated on Jan. 20. Although President Trump supported Medicare price negotiation in the past, it’s unclear where either he or Mehmet Oz, MD (the nominee for CMS Administrator), stand on the issue now. The Trump campaign backed off a similar proposal that would tie drug prices paid in the U.S. to prices paid by other countries.
The ACR has strongly supported the IRA and its provisions related to drug price negotiation, and we will continue to strongly defend it once the new administration and Congress are seated.
Copay Accumulators
In 2021, the CMS issued a final rule that allowed payers to operate copay accumulator programs and deferred to state law on their regulation. However, in 2023, a federal district court ruling struck down the 2021 rule, legally precluding payers from implementing copay accumulators for drugs that lack generic equivalents. However, as of the 2026 Notice of Benefit and Payment Parameters Rule, the CMS has opted not to enforce the court ruling.
Biosimilar Interchangeability
In the summer of 2024, the U.S. Food & Drug Administration (FDA) finalized guidance that removed a requirement for a switching study for demonstrating biosimilar interchangeability. For a biologic product that is administered more than once to an individual, a switching study refers to a clinical study used to determine the impact of alternating between the reference product and the proposed interchangeable biosimilar compared to using the reference product without any such alternation. The new guidance provides recommendations to applicants for proposed interchangeable biosimilar products that would eliminate the need for a switching study.
The ACR cautiously supported this new approach, because switching studies have become superfluous and represent a barrier for patient access to biosimilars. However, we strongly urged the FDA to ensure strict guardrails are upheld to maintain transparency and patient safety.
Antitrust/Pharmacy Benefit Manager Reform
Regulatory agencies are closely examining mergers and acquisitions within the healthcare industry to address potential anti-competitive practices and impacts on patient access and costs. They are also increasing scrutiny on private equity firms’ ownership structures within healthcare facilities and potential impacts on patient care and pricing.
Healthy Competition has been launched by the Federal Trade Commission (FTC), the U.S. Department of Justice (DOJ), and the HHS to allow individuals to report potential healthcare competition concerns. The DOJ has also launched a task force to investigate and address healthcare market consolidation. Additionally, the FTC released an interim report detailing how pharmacy benefit managers (PBMs) have manipulated drug formularies and bottlenecked patient access to necessary treatments.
Underwater Biosimilars Coalition
In the summer of 2024, the ACR joined forces with the Coalition of State Rheumatology Organizations to form the Underwater Biosimilars Coalition, a diverse group of more than 40 patient organizations and specialty societies that have grave concerns regarding the inadequate (or “underwater”) reimbursement of certain Medicare Part B biosimilars under the current average sales price (ASP) methodology and its impact on access to care. The Coalition’s goal is to recommend to regulatory agencies and Congress potential solutions intended to broaden the use of biosimilars. The Coalition has held meetings with the CMS, the Medicare Payment Advisory Commission and the White House Office of Management & Budget and has initiated a letter-writing campaign that has included the CMS and will now pivot to the new Congress.
ACR/ARP members should email the ACR’s advocacy team at [email protected] with any questions and comments they may have on the Coalition’s progress, or on any issue of importance to rheumatology. We will continue to update membership and serve as an educational resource for members on any regulatory or legislative issue that impacts the practice of rheumatology.
