Friday, July 26, 2013

AMP Final Rule Delayed to ... January 2014?

Hey, did you read the latest Semiannual Regulatory Agenda from the Department of Health and Human Services? No?

Well, here's an interesting little factoid buried amidst the administrivia: the long-awaited Final Rule on Covered Outpatient Drugs, a.k.a., the AMP Final Rule, is now scheduled for ... January 2014!

In case you don't feel like trolling through the Federal Register, the brief notice is reproduced below.

As a reminder, the proposed rule regarding Average Manufacturer Price (AMP) under the Patient Protection and Affordable Care Act (PPACA) was released in January 2012. A January 2013 notice suggested that the Final Rule would be released next month, per my not-quite-prescient article: AMP Final Rule is August.

So, the deadline has been pushed back again. But, this time is different. Right?

The text below appears on page 44262 of this Federal Register notice. (Click to enlarge.) Note the date for Final Action is January 2014.

For background on the whole AMP/FUL thing, see AMP Final Rule is August and "Medicaid and AMP-Based Federal Upper Limits" on page 112 of the 2012-13 Economic Report on Retail, Mail and Specialty Pharmacies.

Big tip o' the hat to the CIS Compliance Blog, which unearthed this little gem

Click here if you can't the video below, which is being sponsored by CMS. Thanks, CMS!


  1. Hi Dr Fein,

    I read your article this morning about AMP being delayed to 2014. Do you think this delay has anything to do with CMS trying to establish NADAC and possibly replacing AMP with NADAC?

    Thank you!

  2. Fantastic work Adam. You are making my life a little easier today.

  3. Not really. AMP is explicitly required by the ACA. Probably nothing more than another implementation delay.

  4. Dr. Fein,

    Do any of the formulas (AMP, NADAC, MAC, FUL, Etc..) or cost of goods surveys take into account the rebates that pharmacies may receive on their purchases from wholesalers and manufacturers? Is this factor built into the percentages used to calculate average costs?

  5. AMPs (and AMP-based FULs) are based on manufacturer sales data, not pharmacy purchases. Note that AMPs are only available for multisource drugs and INCLUDE brand prices in the computation.

    NADAC is based on pharmacy surveys, but EXCLUDE off-invoice discounts. That's why it is subject to inflation and manipulation, per my comments in NADAC Momentum: California Abandons Average Acquisition Cost for Pharmacy Reimbursement.

    There is no standardized definition for MAC. States and private payers use a variety of formulas to set the MAC amounts.

    For an overview of pharmacy reimbursement methods, see Chapter 5 of my pharmacy report.

  6. Factoid: misused again. My dictionary says: something resembling a fact; unverified (often invented) information that is given credibility because it appeared in print

  7. Given the CMS delays so far, the January 2014 date perfectly meets your test of "unverified (often invented) information that is given credibility because it appeared in print." ;)

    Perhaps you would have preferred "factlet"?