Drug prices & Part D
Noncovered Drug Versions Are Inflating What Medicare Pays for Certain Infused Medicines, Federal Watchdog Reports
OIG examined five quarters of Part B drug billing data and found that four of six drug billing codes had payment rates pushed up because CMS included the price of noncovered self-administered versions in its calculations.
By the Goodsurance editorial teamAugust 26, 2026
Medicare Part B covers drugs given by infusion or injection in a clinical setting, not drugs taken at home. Many prescription medicines come in both an injectable version covered by Part B and a pill or self-injected form that Medicare does not cover. When manufacturers group both versions under the same billing code, the average price Medicare uses to set payments can be pulled upward by the noncovered form.
The Health and Human Services Office of Inspector General reviewed five consecutive quarters of Part B drug data, from January 2025 through March 2026, to examine how often CMS included average sales prices for noncovered self-administered versions when calculating payment amounts. The agency found six drug billing codes that contained noncovered versions. For four of those six, CMS calculated payment using prices that blended covered and noncovered forms, resulting in inflated payment rates.
OIG found noncovered self-administered drug versions inflated Medicare Part B payment rates for four of six drug codes studied, adding roughly 200 dollars of unnecessary cost-sharing per infusion dose in one example.
OIG used Tremfya, a biologic infused in a clinical setting for plaque psoriasis, as a concrete example. In the fourth quarter of 2025, Medicare and its enrollees paid approximately 15,200 dollars for an induction dose of the infused medicine. Had the noncovered self-administered version been excluded from the billing code, the same dose would have cost approximately 14,200 dollars, about 1,000 dollars less per dose. Because Part B beneficiaries typically owe 20 percent coinsurance on infused drugs, the inflated price translates to roughly 200 dollars of excess out-of-pocket cost per dose.
OIG conducts this review under a congressional mandate and recommends that CMS take corrective action to exclude noncovered drug versions when setting payment rates.
In plain words
Medicare covers drugs you get as a shot or IV drip in a doctor's office. Some of those same drugs also come as a pill you take at home, but Medicare does not pay for the home version. A government watchdog found that six drug billing codes mixed both types together. For four of those drugs, Medicare used the mixed price to set payment, making the price too high. For example, a drug called Tremfya cost about 15,200 dollars per infusion dose, but it should have cost about 14,200 dollars if only the covered form was counted. Patients pay 20 percent of the cost, so they paid about 200 dollars more per dose than they should have. The watchdog says Medicare should fix this.
Understand the basics first
Source: OIG
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