Additional Rebate, Medicaid

For every unit of each product it sells, the manufacturer must give back to the Medicaid program 1, the difference between the current weighted average manufacturer s price and the inflation-adjusted baseline weighted average manufacturer s price. This manufacturer would owe Medicaid 300 in additional rebate. 

The law does allow the Secretary of HHS to exclude from the weighted average price calculation, new products that increase the rebate to Medicaid, but only if their inclusion would impose undue hardship upon the manufacturer. The law also gives the Secretary the power to impose an alternative mechanism for calculating the Additional Rebate. No such alternative approaches have been published to date. 

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