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A biologist works on immunotherapy for HPV+ cancers at the National Cancer Institute. Photo: Saul Loeb/AFP/Getty Images

The Centers for Medicare & Medicaid Services issued a proposed rule yesterday addressing Medicare hospital payments in 2020, including how hospitals will be reimbursed for CAR-T therapies.

The big picture: These are medical procedures that use a patient's own cells to fight cancer — a treatment that also comes with a high price tag.

Details: The proposed rule narrows the gap between what Medicare pays for CAR-T and what the drug companies that make it charge, but there's still a substantial gap.

By the numbers: Hospitals can lose upwards of $100,000 when they administer CAR-T therapies to Medicare beneficiaries today, because of the way payment is structured.

  • The 2 CAR-T therapies on the market have a price tag of $373,000 per procedure.
  • Right now, hospitals receive varying payment rates, which can include an add-on of up to 50% of the manufactures' price, or $186,500. Yesterday's proposal increases that add-on to 65%, or $242,450.

Between the lines: Hospitals would obviously rather be made whole for the cost of the procedure. There'd been talk of increasing the base payment by creating a new billing code for CAR-T, but CMS decided not to do that, at least not yet.

  • Outpatient reimbursement for the procedure is much more generous, as it's structured completely differently, but comes with added risk.

CMS is also considering raising Medicare rates to hospitals by 3.7% on average next year, by far the largest proposed pay hike in several years. Penalties for too many readmissions or poor quality will be opportunities for wiggle room in the Medicare price hike.

Go deeper: Stat News dug into hospitals' payment dilemma in March.

— Correction: An earlier version of this story said hospitals all get paid the same amount for CAR-T therapy. That's incorrect. Their payments vary.

Go deeper

Updated 1 hour ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Coronavirus cases rose 10% in the week before Thanksgiving.
  2. Politics: Supreme Court backs religious groups on New York coronavirus restrictions.
  3. World: Expert says COVID vaccine likely won't be available in Africa until Q2 of 2021 — Europeans extend lockdowns.
  4. Economy: The winners and losers of the COVID holiday season.
  5. Education: National standardized tests delayed until 2022.
3 hours ago - Health

Standardized testing becomes another pandemic victim

Photo: Edmund D. Fountain for The Washington Post via Getty

National standardized reading and math tests have been pushed from next year to 2022, the National Center for Education Statistics (NCES) announced Wednesday.

Why it matters: There’s mounting national evidence that students are suffering major setbacks this year, with a surge in the number of failing grades.

4 hours ago - World

European countries extend lockdowns

A medical worker takes a COVID-19 throat swab sample at the Berlin-Brandenburg Airport. Photo by Maja Hitij via Getty

Recent spikes in COVID-19 infections across Europe have led authorities to extend restrictions ahead of the holiday season.

Why it matters: "Relaxing too fast and too much is a risk for a third wave after Christmas," said European Commission President Ursula von der Leyen.