History of Off-Label Drug Use

A little history – A key policy question of the late 1980s and early 1990s was whether medical insurance should cover unlabeled uses of drugs. Because health insurance policies generally excluded payment for experimental treatments, insurers denied claims for unlabeled uses of drugs. After several attempts in the preceding years, Congress, in the Omnibus Budget Reconciliation Act of 1993, amended Title XVIII of the Social Security Act, which governs Medicare, to address this issue. The provision required Medicare to cover off-label uses of anticancer drugs included in certain standard medical compendia.

Congress subsequently adopted a compendia-based system for determining coverage of off-label uses of all drugs reimbursed by Medicaid. When Congress created a new Part D outpatient prescription drug benefit for Medicare beneficiaries in the Medicare Modernization Act of 2003, the compendia-based coverage determination was again the model. Managed care medical directors, pharmacy benefits directors, and other health care professionals also reference the Compendium when making decisions that impact patient access to appropriate therapy. Private insurers often follow Medicare’s lead in paying for drugs. Thus, in a variety of legislative contexts, Congress has strongly endorsed the value of the recognized medical compendia for ascertaining the medical appropriateness of off-label uses of cancer drugs .

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