In the proposed rule for calendar year 2009 payments, CMS is proposing to reimburse hospitals for separately paid drugs in the hospital outpatient setting based on Average Sales Price (ASP) plus 4 percent.  According to CMS, this amount includes the acquisition cost of the drugs and an allowance for pharmacy overhead.  In this May 2008 report, The Moran Company simulates an alternative payment methodology which attempts to deal with the problem of charge compression and the uneven distribution of pharmacy overhead among high and low cost drugs while remaining budget neutral.   

Full title: Pharmacy Overhead: An Alternative Methodology

Use this link   http://www.themorancompany.com/index.php?option=com_docman&task=doc_download&gid=7&Itemid=28 to download the report.