42 CFR § 414.701 - Purpose.

---
identifier: "/us/cfr/t42/s414.701"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "42 CFR § 414.701 - Purpose."
title_number: 42
title_name: "Public Health"
section_number: "414.701"
section_name: "Purpose."
chapter_name: "CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES"
subchapter_number: "B"
subchapter_name: "MEDICARE PROGRAM"
part_number: "414"
part_name: "PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES"
positive_law: false
currency: "2026-03-24"
last_updated: "2026-03-24"
format_version: "1.1.0"
generator: "[email protected]"
authority: "42 U.S.C. 1302, 1395hh, and 1395rr(b)(l)."
regulatory_source: "55 FR 23441, June 8, 1990, unless otherwise noted."
cfr_part: "414"
---


# 414.701 Purpose.

This subpart implements section 1842(o) of the Act by specifying the methodology for determining the payment allowance limit for drugs and biologicals covered under Part B of Title XVIII of the Act (hereafter in this subpart referred to as the “program”) that are not paid on a cost or prospective payment system basis. Examples of drugs that are subject to the rules contained in this subpart are: Drugs furnished incident to a physician's service; durable medical equipment (DME) drugs; separately billable drugs at independent dialysis facilities not under the ESRD composite rate; statutorily covered drugs, for example, influenza, pneumococcal, hepatitis, and COVID-19 vaccines, antigens, hemophilia blood clotting factor, immunosuppressive drugs and certain oral anti-cancer drugs.

[85 FR 71197, Nov. 6, 2020]