Sustainability: Balancing Spend with Revenue to Support Outcomes
- By Bonnie Kirschenbaum, MS, FASHP, FCSHP
In This Article:
Affordability and cost-containment pressures are top of mind in all healthcare systems, coupled with uncertainty as to which rapidly proposed/announced changes in pricing models, among others, will be implemented. Areas such as pharmacy with a high spend for the products they supply to patients must be proactive, taking every opportunity to increase revenue from payable services, as well as guaranteeing complete and clean claims submissions.
Sustainability inherently means being on high alert for every opportunity while maintaining balanced spend/revenue. The focus on health cost growth and affordability can’t be ignored. Following are many of the changes impacting 2026, as well as what overlooked opportunities there are in remote patient monitoring.
Evolving ASP Methodology and Abrupt 2026 Resource Changes
Average sales price (ASP) is a market-based price that reflects the weighted average of all manufacturer sales prices. It includes all rebates and discounts privately negotiated between manufacturers and purchasers (with the exception of Medicaid and certain federal discounts and rebates). It isn’t the price providers pay and doesn’t take into consideration any contract terms or distributor markups.
The implementation date for ASP methodology applied to products on or after Jan. 1, 2005. The Centers for Medicare and Medicaid (CMS) required manufacturers to report their ASP data, for calendar quarters beginning on or after Jan. 1, 2004, for drugs or biological products payable under Medicare Part B and described in the Act with a Medicaid drug rebate agreement.
Subsequently, the rules were amended to add a new section that requires manufacturers without a Medicaid drug rebate agreement to report ASP information to CMS, for calendar quarters that began Jan. 1, 2022, for drugs or biological products payable under Medicare Part B and described in specific sections, including items, services, supplies and products payable under Part B as a drug or biological.
Manufacturers continue reporting this information to CMS for calendar quarters using the ASP Data Collection System, and CMS publishes quarterly ASP pricing files. These pricing files have been published in three formats, each with a different use: Medicare Part B Payment Limit Files, NDC-HCPCS Crosswalk Files and Not Otherwise Classified (NOC) Medicare Part B Payment Limit File. Additionally CMS publishes extensive listings of all products (not limited to drugs). Addendums A and B also reflect the status indicator (SI) assigned to each HCPCS code, as well as price. However, in 2026, there will be changes:1
ASP pricing tables. CMS hasn’t released a January 2026 NOC Medicare Part B Payment Limit File. It does state that it evaluates drugs quarterly to determine if they should be published in the payment limit files. It also clarifies that it “may not publish an ASP-based payment limit or crosswalk for all drugs that are reported by manufacturers.” The absence or presence of a HCPCS, NDC code and/or payment limit in the ASP pricing files does not indicate whether Medicare covers a particular product. Even if a product does not appear on a quarter’s ASP pricing files, the local Medicare Administrative Contractor (MAC) may process the Part B claim after determining the payment limit, provided the claim is reasonable and necessary and meets all necessary requirements for payment.
ASP reporting changes: bona fide service fee certification and ASP reasonable assumptions. As of Jan. 1, 2026, manufacturers of drugs payable under Medicare Part B are required, as part of the submission of ASP data, to submit reasonable assumptions, including fair market value documentation for current, new and renewed contracts, and certification from the recipient of a bona fide service fee that the fee is not passed on in whole or in part to a client or customer of an entity, whether or not the entity takes title to the drug. Refer to the 2026 Physician Fee Schedule Final Rule (90 FR 49532 through 49542) for details on both the rationale and the possible implications to ASP itself.
Addendum B. Although the calendar year 2026 outpatient prospective payment system (OPPS) rule set refers to Addendum B for details, CMS has opted not to publish it on its website. The last one available is dated October 2025.2
Advancing Chronic Care with the Effective, Scalable Solutions (ACCESS) Model
The ACCESS payment model created by the CMS Innovation Center (CMMI) reimburses providers for using telehealth, wearables and other digital health technologies for traditional Medicare beneficiaries with chronic conditions who have improved outcomes. Providers receive recurring payments for managing patients’ conditions with full payment tied to achieving measurable health outcomes. Focus is on clinical improvement of a condition based on each patient’s starting point.
Prior Authorization: Two Approaches
CMMI has introduced a six-year model focused on prior authorization titled Wasteful and Inappropriate Service Reduction (WISeR). It’s unique in that it is the only CMMI model in which voluntary participants will be those who are considered technology innovators. This is defined as technology vendors with demonstrated experience using AI and automation tools to manage the prior authorization processes and assess coverage determinations on behalf of payers for providers and suppliers for Traditional Medicare (excludes Medicare Advantage). Additionally, participation is limited to those operating in Arizona, New Jersey, Ohio, Oklahoma, Texas and Washington states.
The model requires healthcare providers either to submit a prior authorization request for the selected services or to opt for a retrospective review. The tech vendors then will apply their technology to assess coverage determinations and will receive a percentage of the savings associated with what has been averted as wasteful, inappropriate care. Initial selected services are those considered to be susceptible to fraud, waste and abuse and include skin and tissue substitutes, electrical nerve stimulator implants and knee arthroscopy.
The model design focuses on the timeliness of response and the clarity of the explanation of the determination, both of which are considered to be lacking in current prior authorization processes, as well as clinical quality outcomes from the use of alternative services.3
CMS Advancing Interoperability and Improving Prior Authorization Processes Final Rule
This rule (CMS-0057-F), which impacts both healthcare providers and payers, focuses on improving the electronic exchange of healthcare data, as well as streamlining prior authorization processes. To encourage providers to adopt electronic prior authorization processes, it adds a new measure for Merit-based Incentive Payment System (MIPS)-eligible clinicians under the promoting interoperability performance category of MIPS, as well as for eligible hospitals and critical access hospitals, under the Medicare Promoting Interoperability Program. Impacted payers must implement certain operational provisions, generally beginning Jan. 1, 2026. To improve the prior authorization processes, payers are required to send prior authorization decisions within 72 hours for expedited (i.e., urgent) requests and seven calendar days for standard (i.e., non-urgent) requests. They also must provide a specific reason for denied prior authorization decisions, regardless of the method used to send the prior authorization request using portal, fax, email, mail or phone. However, this provision does not apply to prior authorization decisions for drugs at this point in time.4
Remote Patient Monitoring
Medicare will reimburse for remote patient monitoring for eligible patients with chronic or acute conditions who require monitoring and can collect their own health data using an Internet-connected medical device that meets FDA’s definition and digitally uploads data to the provider’s site. This applies to the treatment and management of blood pressure, weight and glucose levels.
Three components are required by Medicare for reimbursement:
1) Education about how to use the device and transmit the health data to ensure patients use the device appropriately to collect accurate data.
2) An Internet-connected device, including the collection and transmission of at least 16 readings every 30 days, to get the appropriate health information. Examples of these devices include connected blood pressure cuffs, weight scales and pulse oximeters.
3) A review of the health data and its use to manage the patient’s condition.5,6
References
1. Centers for Medicare and Medicaid Services. Bona Fide Service Fee Certification and Average Sales Price Reasonable Assumptions Frequently Asked Questions. Accessed at www.cms.gov/files/document/frequently-asked-questions-faqs-bfsf-certification-asp-reasonable-assumptions.pdf.
2. Centers for Medicare and Medicaid Services. Quarterly Addenda Updates. Accessed at www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient-pps/quarterly-addenda-updates.
3. Centers for Medicare and Medicaid Services. WISeR (Wasteful and Inappropriate Service Reduction) Model. Accessed at www.cms.gov/priorities/innovation/innovation-models/wiser.
4. Centers for Medicare and Medicaid Services. CMS Finalizes Rule to Expand Access to Health Information and Improve the Prior Authorization Process. Accessed at www.cms.gov/newsroom/press-releases/cms-finalizes-rule-expand-access-health-information-and-improve-prior-authorization-process.
5. Centers for Medicare and Medicaid Services. Remote Patient Monitoring. Accessed at www.cms.gov/medicare/coverage/telehealth/remote-patient-monitoring.
6. Centers for Medicare and Medicaid Services. Telehealth & Remote Monitoring. Accessed at www.cms.gov/files/document/mln901705-telehealth-remote-monitoring.pdf.