Section 419.41 - [Effective 1/1/2025] Calculation of national beneficiary copayment amounts and national Medicare program payment amounts(a) To calculate the unadjusted copayment amount for each APC group, CMS- (1) Standardizes 1996 hospital charges for the services within each APC group to offset variations in hospital labor costs across geographic areas;(2) Identifies the median of the wage-neutralized 1996 charges for each APC group; and(3) Determines the value equal to 20 percent of the wage-neutralized 1996 median charge for each APC group and multiplies that value by an actuarial projection of increases in charges for hospital outpatient department services during the period 1996 to 1999. The result is the unadjusted beneficiary copayment amount for the APC group.(b) CMS calculates annually the program payment percentage for every APC group on the basis of each group's unadjusted copayment amount and its payment rate after the payment rate is adjusted in accordance with § 419.32 .(c) To determine payment amounts due for a service paid under the hospital outpatient prospective payment system, CMS makes the following calculations:(1) Makes the wage index adjustment in accordance with § 419.43 .(2) Subtracts the amount of the applicable Part B deductible provided under § 410.160 of this chapter.(3) Multiplies the remainder by the program payment percentage for the group to determine the preliminary Medicare program payment amount.(4) Subtracts the program payment amount from the amount determined in paragraph (c)(2) of this section to determine the copayment amount.(i) The copayment amount for an APC cannot exceed the amount of the inpatient hospital deductible, established in accordance with § 409.82 of this chapter, for that year. For purposes of this paragraph (c)-(A) Effective for drugs and biologicals furnished on or after January 1, 2001, the copayment amount for multiple APCs for a single drug or biological furnished on the same day will be aggregated and treated as the copayment amount for one APC.(B) Effective for drugs and biologicals furnished on or after July 1, 2001, the copayment amount for the APC or APCs for a drug or biological furnished on the same day will be aggregated with the copayment amount for the APC that reflects the administration of the drug or biological furnished on that day and treated as the copayment amount for one APC.(ii) Effective for services furnished from April 1, 2001 through December 31, 2001, the national unadjusted coinsurance rate for an APC cannot exceed 57 percent of the prospective payment rate for that APC.(iii) The national unadjusted coinsurance rate for an APC cannot exceed 55 percent in calendar years 2002 and 2003; 50 percent in calendar year 2004; 45 percent in calendar year 2005; and 40 percent in calendar year 2006 and thereafter.(iv) The copayment amount is computed as if the adjustment under §§ 419.43(d) and (e) (and any adjustments made under § 419.43(f) in relation to these adjustments) and § 419.43(h) had not been paid.(5) Adds the amount by which the copayment amount would have exceeded the inpatient hospital deductible for that year to the preliminary Medicare program payment amount determined in paragraph (c)(3) of this section to determine the final Medicare program payment amount.(d) Notwithstanding paragraphs (a) through (c) of this section, for a drug or biological for which payment is not packaged into a payment for a covered outpatient department (OPD) service (or group of services) and is not a rebatable drug (as defined in section 1847A(i)(2)(A) of the Act), to calculate the program payment and copayment amounts CMS does the following:(1) Determines the payment rate for the drug or biological for the quarter established under the methodology described by section 1842(o), section 1847A, or section 1847B of the Act, as the case may be, as calculated and adjusted by the Secretary as necessary for purposes of paragraph (14) of section 1833(t) of the Act.(2) Subtracts from the amount determined under paragraph (d)(1) of this section the amount of the applicable Part B deductible provided under § 410.160 of this chapter.(3) Multiples the amount determined under paragraph (d)(1) of this section (less any applicable deductible under paragraph (d)(2) of this section) by 20 percent. This is the beneficiary's copayment amount for the drug or biological.(4) Subtracts the amount determined under paragraph (d)(3) of this section from the amount determined under paragraph (d)(1) of this section (less any applicable deductible determined under paragraph (d)(2) of this section). This amount is the preliminary program amount.(5) Adds to the preliminary program amount determined under paragraph (d)(4) of this section the amount by which the copayment amount would have exceeded the inpatient hospital deductible for that year. This amount is the final Medicare program payment amount.(e) In the case of a rebatable drug (as defined in section 1847A(i)(2)(A) of the Act), except if such drug does not have a copayment amount as a result of application of section 1833(t)(8)(E) of the Act, for which payment is not packaged into payment for a covered OPD service (or group of services) furnished on or after April 1, 2023, and the payment for such drug under the outpatient prospective payment system (OPPS) is the same as the amount for a calendar quarter under section 1847A(i)(3)(A)(ii)(I) of the Act, in lieu of the calculation of the copayment amount and the Medicare program payment amount otherwise applicable under paragraph (d) of this section (other than application of the limitation described in paragraph (c)(4)(i) of this section), the copayment and Medicare program payment amounts determined under §§ 410.152(m) and 489.30(b)(6) of this chapter shall apply.(f) In the case of a qualifying biosimilar biological product (as defined in § 414.902 of this chapter) that is furnished during the applicable five-year period (as defined in § 414.902 of this chapter) for such product, the payment amount for such product with respect to such period is the amount determined in § 414.904(j)(2) of this chapter.(g) For dates of service on or after July 1, 2024, the payment amount for a biosimilar biological product (as defined in § 414.902 of this chapter) during the initial period is the amount determined in § 414.904(e)(4)(ii) of this chapter.(h) For a therapeutic radiopharmaceutical for which payment is not packaged into a payment for a covered outpatient department (OPD) service (or group of services) and that does have on transitional pass-through payment status as described in § 419.64 , to calculate the program payment and copayment amounts CMS does the following: (1) Determines the average sales price (ASP) for the therapeutic radiopharmaceutical for the quarter established under the methodology described by section 1847A of the Act. If that amount is not available, then CMS calculates the mean unit cost (MUC) using the most recently available claims data for that therapeutic radiopharmaceutical.(2) Subtracts from the amount determined under paragraph (h)(1) of this section the amount of the applicable Part B deductible provided under § 410.160 of this chapter.(3) Multiplies the amount determined under paragraph (h)(1) of this section (less any applicable deductible under paragraph (h)(2) of this section) by 20 percent. This is the beneficiary's copayment amount for the drug or biological.(4) Subtracts the amount determined under paragraph (h)(3) of this section from the amount determined under paragraph (h)(1) of this section (less any applicable deductible determined under paragraph (h)(2) of this section). This amount is the preliminary program amount.(5) Adds to the preliminary program amount determined under paragraph (h)(4) of this section the amount by which the copayment amount would have exceeded the inpatient hospital deductible for that year. This amount is the final Medicare program payment amount.(i) For a diagnostic radiopharmaceutical for which payment is not packaged into a payment for a covered OPD service (or group of services) and that does not have transitional pass-through payment status as described in § 419.64 , to calculate the program payment and copayment amounts CMS does the following: (1) Calculates the MUC using the most recently available claims data for that diagnostic radiopharmaceutical, if claims data are available. If claims data are not available, determines the ASP for the diagnostic radiopharmaceutical for the quarter established under the methodology described by section 1847A of the Act. If ASP data are not available, then based on the wholesale acquisition cost (WAC), under the methodology described by section 1847A of the Act. If WAC data are not available, then based on 95 percent of the average wholesale price.(2) Subtracts from the amount determined under paragraph (i)(1) of this section the amount of the applicable Part B deductible provided under § 410.160 of this chapter.(3) Multiplies the amount determined under paragraph (i)(1) of this section (less any applicable deductible under paragraph (i)(2) of this section) by 20 percent. This is the beneficiary's copayment amount for the drug or biological.(4) Subtracts the amount determined under paragraph (i)(3) of this section from the amount determined under paragraph (i)(1) of this section (less any applicable deductible determined under paragraph (i)(2) of this section). This amount is the preliminary program amount.(5) Adds to the preliminary program amount determined under paragraph (i)(4) of this section the amount by which the copayment amount would have exceeded the inpatient hospital deductible for that year. This amount is the final Medicare program payment amount.(j) For a drug covered as an additional preventive service (DCAPS), as defined at § 410.64 of this chapter, the program payment amount is 100 percent of the payment amount determined as follows:(1) If ASP data is available for the drug, consistent with part 414, subpart J, of this chapter, then the payment amount is determined using the methodology set forth in section 1847A of the Act and according to the provisions in part 414, subpart K, of this chapter.(2) If ASP data is not available, then the payment amount is determined according to the most recently published National Average Drug Acquisition Cost (NADAC) prices for the drug and is the lesser of the median NADAC price of all generic forms of the drug or the lowest NADAC price brand name product.(3) If ASP data and NADAC prices are not available, then the payment amount is determined according to the most recently published pharmaceutical pricing data for the drug as included in the Federal Supply Schedule (FSS), as managed by the Department of Veterans Affairs per 48 CFR part 38, and is the lesser of the median FSS price of all generic forms of the drug or the lowest FSS price brand name product.(4) If ASP data, NADAC prices, and FSS pharmaceutical prices are not available, then, for the period beginning January 1, 2025, through December 31, 2025, the payment amount is WAC plus 6 percent, or 3 percent if in an initial sales period consistent with 1847A(c)(4) of the Act, and beginning January 1, 2026, the payment amount is the invoice price determined by the Medicare Administrative Contractor (MAC). 65 FR 18542 , Apr. 7, 2000, as amended at 65 FR 67829 , Nov. 13, 2000; 66 FR 59923 , Nov. 30, 2001; 73 FR 68814 , Nov. 18, 2008; 88 FR 82180 , Nov. 22, 2023 88 FR 82180 , 1/1/2024; 89 FR 94589 , 1/1/2025