In its 2026 Medicare Physician Fee Schedule proposed rule, the Centers for Medicare & Medicaid Services (CMS) has proposed additional guidance for how manufacturers will calculate their average sales prices (ASP) for drugs that are payable under Medicare Part B (the section that covers physician office visits and services ancillary to those visits).

The proposed guidance involves two aspects of the drug price calculation: (1) specifying when fees are considered price concessions instead of bona fide service fees and (2) how manufacturers should allocate pricing for drugs sold under a bundled arrangement. These changes could have significant implications for manufacturers, not only in how they calculate prices, but also in the coordination and operational burdens of changing their methodology. In this post, we outline proposed changes and highlight key steps industry participants should take to prepare, should these changes be finalized.

The changes are included in the Proposed Calendar Year 2026 Payment Policies under the Physician Fee Schedule. The proposed rule is available for public comment until September 12, 2025, and the final version is expected to be published in November.