Comments on CMS hospital payment proposal for maintaining a buffer stock of critical medicines

Hospital worker inspecting medicine inventory
Editor's note:

This comment letter was originally submitted to the Centers for Medicare & Medicaid Services on September 11, 2023.

Marta Wosińska and Emily Tucker recently commented on a Centers for Medicare & Medicaid Services (CMS) proposal to establish a drug buffer inventory payment for acute hospitals.  The proposed payment would cover Medicare’s share of reasonable costs of establishing and maintaining access to a three-month buffer stock of one of more of the 86 essential medicines.

In their comment letter, Wosińska and Tucker describe why the proposal will not have much effect on shortages where it is most needed.  In addition, some provisions may inadvertently result in increased levels of waste, fraud, and abuse.

Wosińska and Tucker propose several improvements to the program: extending buffer to at least six months, narrowing down the proposal to third-party options only, switching from a submit-a-bill to a fixed payment, and being more explicit when inventories are to be build up and drawn down.

Unfortunately, the constraints of CMS’s proposal do not allow it to address panic buying of products, which in turn results in access disparities.  Other HHS Agencies would be better positioned to address this problem.  In turn, Wosińska and Tucker propose that CMS’s greatest contribution is in encouraging hospitals to buy from reliable manufacturers.

Read the full comment letter here.


  • Acknowledgements and disclosures

    The authors would like to thank Richard Frank for excellent comments on an earlier draft.

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