WASHINGTON — A key Senate committee is proposing that Medicare pay bonuses to hospitals that take measures to prevent drug shortages. It also wants to change the way doctors are paid to administer drugs in outpatient settings.
After a startling number of drugs, including chemotherapies, were in shortage last year, Washington stepped up its efforts to find policy solutions for the problems.
Most experts say the way that Medicare pays hospitals and doctors, along with the dominance of group purchasing organizations that buy hospital drugs, together force generic drug makers to cut prices for cheaper generics so low that there is no money left for maintaining facilities or using reliable, diversified supply chains. The result is that facilities get shut down or generic drug manufacturers exit markets, leaving too few makers of drugs to supply demand.