Payments for Innovative Ophthalmic Surgery Drugs Should Be Unbundled

The Centers for Medicare & Medicaid Services’ (CMS) policy on bundling reimbursement for innovative drugs makes it cost-prohibitive to keep using these treatments after their pass-through status expires, ending the additional payments that status provides.

The Academy is leading a group of societies in urging the agency to change how it bills for certain drugs administered during surgery to address postoperative issues. 

In a letter (PDF) with ASCRS and the Outpatient Ophthalmic Surgery Society, we urged CMS to address the issue in the draft 2022 Medicare physician fee schedule due out this summer.

Access is potentially at issue for two drugs used during ophthalmic surgery to address postop inflammation, complications and pain. Dextenza (dexamethasone ophthalmic insert) and Dexycu (dexamethasone injectable suspension) are extended-release medications that spare patients from having to purchase and apply eye drops after surgery. The pass-through status and additional payment for each drug ends in 2022.

CMS bundles drugs like these into facility payment for the ophthalmic surgery, even though they are not technically part of the surgery and instead are used to treat post-op conditions. For the duration of pass-through status, for up to three years, CMS covers the direct cost of the drug.

Once a Food and Drug Administration-approved drug’s pass-through status expires, CMS reimburses the drug as part of the facility fee. As we told CMS, “The facility fee rarely cover[s] the full cost of the drug or device. [Ambulatory surgery centers] operating on tight margins may be unable to provide patients with access to all FDA-approved medications with postoperative indications because they are too costly and not fully recognized nor accounted for in the bundled facility fee.”

And it’s not just a cost issue. The eye drop alternatives also put more burden on our patients. As we wrote, “Many ophthalmic surgery patients are aged, have memory limitations, significant physical conditions, and comorbidities. Medications administered by the surgeon at the time of surgery are a valuable treatment alternative to post-operative drops and have the potential to reduce or eliminate the need for patient-administered post-operative medication.”

We urged CMS to follow the precedent for how it reimburses nonopioid pain management drugs sometimes used during surgery. We will continue to monitor this issue and keep you informed of any developments.