CMS issues major new guidance on HCPCS Code Assignments

CMS recently released it's summary of HCPCS coding decisions effective January 1, 2023. The announcement contained a major clarification of policy with regards to new drugs approved under the BLA or 505(B)(2) FDA approval pathways.


The full document can be accessed by clicking HERE. The relevant information can be found on pages 31-34. To view a table of newly created codes click HERE.


Key issues outlined in the document include:


  • Drugs approved after 2003 under the NDA or BLA pathway and NOT rated as therapeutically equivalent to the Reference Listed Drug in Orange Book (typically the originator branded product), will be assigned a unique HCPCS code to facilitate payment using ASP for that particular manufacturer's NDCs.

  • 36 new or revised HCPCS codes will be effective January 1, 2023 to identify drugs that are not therapeutically equivalent to the Reference Listed Drug. This includes many codes that were NOT requested by the manufacturer.

  • NDCs of Drugs that are rated as therapeutically equivalent to the Reference Listed Drug in Orange Book will be aligned to the same HCPCS code as the originator drug. These are traditional generic drugs approved under the ANDA pathway

  • Several existing HCPC code descriptors will change to account for a more generic description that can include all therapeutically equivalent products.

  • Manufacturers of 505(B)(2) products and their originator competitors should verify their HCPCS code and description for January 1, 2023 and ensure that CMS and the major pricing compendia have the correct NDC to HCPCS code alignments in their files.

We realize that this situation is confusing and has major implications for manufacturers, payers and providers of office administered drugs and we would like to offer free educational resources to help better understand this issue. We also have tools and advice available to help manufacturers navigate this new reality.

If you would like to speak with me about our solutions, you can reach me at Ian.Kaswan@AlchemyHCS.com

We are considering a Webinar overview on this topic featuring our expert panel.