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Federal Government Affairs

Medicare Pt. B Inhalation Drugs

When Congress enacted the Medicare Medicaid Modernization Act of 2003 (MMA), it made significant changes in many areas of the Medicare program. One particular change was how the Medicare program would, in the future pay for Pt. B drugs (the very few prescription drugs that have always been covered by Medicare, prior to the January 2006 implementation of the full prescription drug benefit) Payment for inhalation drugs (such as albuterol) were to be significantly reduced. The MMA clearly stated in the law how future payments for the drugs would be calculated. There was no room for regulatory negotiation on this area. However, the area regarding drug payments that was open for discussion was what should be an appropriate drug dispensing fee for these inhalation drugs were dispensed.