Medicare Competitive Acquisition Program For Part B Drugs and Biologicals

In 1965, the Social Security Act established both Medicare and Medicaid. Medicare was a responsibility of the Social Security Administration (SSA), while Federal assistance to the State Medicaid programs was administered by the Social and Rehabilitation Service (SRS). SSA and SRS were agencies in the Department of Health, Education, and Welfare (HEW). In 1977, the Health Care Financing Administration (HCFA) was created under HEW to effectively coordinate Medicare and Medicaid. In 1980 HEW was divided into the Department of Education and the Department of Health and Human Services (HHS). In 2001, HCFA was renamed the Centers for Medicare & Medicaid Services (CMS).

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CMS announced a system whereby all health care providers, including Medicare providers, can apply for a new identifier, known as the National Provider Identifier, or NPI, starting May 23, 2005.

In a ruling announced today by Administrator Mark B. McClellan, M.D., Ph.D., CMS clarified its payment rules to present beneficiaries with the choice to receive presbyopia-correcting intraocular lenses (IOLs) that not only replace lens clouded by cataracts but also allows the eye to focus on near, intermediate, and far vision, minimizing the need for corrective lens.

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On December 8, 2003, President George W. Bush signed into law the Medicare Prescription Drug, Improvement and Modernization Act (MMA) of 2003. This landmark legislation provides seniors and people living with disabilities with a prescription drug benefit, more choices and better benefits under Medicare, the most significant improvement to senior health care in nearly 40 years.

This web page is designed to provide hospitals, physicians, and ambulance providers with accurate information regarding the implementation of section 1011 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA).

Welcome to the Official Centers for Medicare & Medicare Services (CMS) Titles I & II webpage. This is a very special time for Medicare beneficiaries, full of many exciting program improvements and enhancements. The Medicare Modernization Act (MMA), passed with bipartisan support in Congress and signed into law by President Bush on December 8, 2003, has given us unprecedented opportunities to bring more personalized, high-quality modern health care to Medicare's millions of beneficiaries.

Section 303 (d) of the MMA (adobe pdf 26Kb) requires the implementation of a competitive acquisition program (CAP) for Medicare Part B drugs and biologicals not paid on a cost or prospective payment system basis. Beginning with drugs administered on or after January 1, 2006, physicians will be given a choice between buying and billing these drugs under the average sales price (ASP) system, or obtaining these drugs from vendors selected in a competitive bidding process.