CMS Proposes New Rules for Calculating Average Sales Price for Medicare Part B Drug Reimbursement


Merle M. DeLancey, Jr. ●

The Centers for Medicare & Medicaid Services (“CMS”) released the Calendar Year 2026 Medicare Physician Fee Schedule (“PFS”) proposed rule on July 16, 2025. (See cms.gov/newsroom/fact-sheets/calendar-year-cy-2026-medicare-physician-fee-schedule-pfs-proposed-rule-cms-1832-p). The proposed rule includes potentially significant changes to what is considered a bona fide service fee (“BFSF”) when calculating average sales price (“ASP”) under Medicare Part B.[*]

Under Medicare Part B, most drugs are reimbursed based on ASP plus six percent. Manufacturers report ASPs to CMS quarterly. With certain exceptions, ASP is defined as a weighted average price to commercial customers in the United States. Drug manufacturer price concessions are deducted when calculating ASP but BFSFs are not. To support a higher ASP, which increases a drug’s reimbursement, manufacturers seek to avoid price concessions and instead classify programs as BFSFs. Improperly classifying a price concession as a BFSF increases a manufacturer’s ASP, which results in Medicare overpayments and higher coinsurance amounts for Medicare beneficiaries.

Continue reading “CMS Proposes New Rules for Calculating Average Sales Price for Medicare Part B Drug Reimbursement”

Webinar: Impacts on Government Contractors: 180 Days of the Trump Administration—Quick Hits on Executive Orders, Actions, and Policies

Blank Rome-Hosted Live Webinar
July 29, 2025
12:00–1:00 p.m. EDT | 9:00–10:00 a.m. PDT


Please join Blank Rome Government Contracts attorneys Justin A. Chiarodo, Dominique L. Casimir, Robyn N. Burrows, and Sara N. Gerber for this timely webinar with key updates for government contractors navigating the first 180 days of the Trump Administration, and the days ahead.

Topics include:

  • Civil rights enforcement / diversity, equity, and inclusion
  • Federal Acquisition Regulation update
  • Contract and grant terminations 

This session is part of Blank Rome’s summer live webinar series 180 Days of the Trump Administration—Quick Hits on Executive Orders, Actions, and Policies (ending on Wednesday, August, 13, 2025), where our interdisciplinary Trump Administration Resource Team is unpacking the most pressing legal, regulatory, and policy developments from the Trump administration’s first 180 days.

Click here to register for the July 29 government contractor session and for any future sessions: Summer 2025- Trump 180 Day Webinar Series | RSVP Blank.

You may also view any past sessions on demand here: On-Demand Webinar Series: 180 Days of the Trump Administration.

60-Second Sustains: BrightPoint, LLC

Elizabeth N. Jochum and David L. Bodner ●

Protest of: BrightPoint, LLC
B-423392, B-423392.2, B-423392.3

  • BrightPoint raised numerous challenges to the Department of Agriculture’s evaluation and award of a task order for information technology services.
  • The Government Accountability Office (“GAO”) sustained one protest ground: that the discriminators identified by the Agency to justify its award decision were based on the awardee’s experience with work unrelated to the anticipated work scope and also possessed and demonstrated by Brightpoint.
  • In response to this protest ground, the Agency argued “in general terms” that its evaluation was reasonable and equal.
  • But GAO noted that the Agency did not demonstrate a connection between the Solicitation’s requirements and the positive findings it gave to the awardee’s experience.
  • The Agency also did not “meaningfully respond” to Brightpoint’s allegations of unequal treatment, stating only that it treated offerors equally.
  • GAO determined that, but for the discriminators identified in favor of the awardee, Brightpoint might have been selected for award, even at a small price premium.
  • GAO recommended the Agency reevaluate the prior experience volumes and make a new source selection decision.

Department of Defense to Increase Scrutiny Over IT Consulting and Advisory Contracts

Michael Joseph Montalbano  and Amanda C. DeLaPerriere ●

The Department of Defense’s (“DoD”) Under Secretary for Acquisition and Sustainment issued a memorandum on June 23, 2025, that tightens oversight on DoD contracts for information technology consulting & management services (“ITC&MS”) and advisory & assistance services (“A&AS”).

What contracts are impacted?

The memorandum applies to unclassified, FAR-based contracts or task orders for ITC&MS or A&AS. ITC&MS are services provided by integrators or consultants that involve system information technology (“IT”) integration, implementation, or advice and that are valued at over $10 million. A&AS are services for consulting, advising, assisting, or any professional services for similar functions, and that are valued over $1 million. The memorandum expressly notes that requirements may not be split into multiple efforts to stay under the $10 million and $1 million thresholds. Additionally, the memorandum does not apply to already existing consulting and advisory contracts. 

What is the timeline for review?

Effective immediately, DoD agencies must secure advance approval from the Department of Government Efficiency (“DOGE”) for all qualifying ITC&MS or A&AS contracts. DoD agencies must include in their approval request a description of the contract’s purpose, a cost/benefit analysis, and a justification as to why the efforts cannot be insourced or acquired from a direct service provider. DOGE then has three business days to respond. If DOGE does not respond or approves the contract, then the contract may proceed. If DOGE raises issues with the contract, then DOGE and the DoD agencies are required to work collaboratively to resolve those issues. The memorandum does not specify whether DOGE can block a DoD agency from moving forward with the contract, whether there is any time limit on DOGE and DoD’s attempts to work collaboratively, or whether the agency has a specific appeal process if it disagrees with DOGE’s assessment.

Scope and Exemptions

Not all ITC&MS or A&AS contracts are subject to review. The memo expressly excludes:

  • ITC&MS contracts involving “direct service providers” performing services rather than resellers, integrators, or intermediaries.
  • ITC&MS contracts in direct support of defense weapon system programs or sustainment activities.
  • A&AS contracts for systems engineering and technical assistance in support of major defense acquisition programs.

These exemptions align with the Administration’s decision to prioritize war fighting efforts as well as procure more supplies and services from Original Equipment Manufacturers.

Strategic Implications for Contractors and Agencies

This memorandum reflects a strategic push—rooted in broader federal efficiency initiatives—to trim consulting spend, eliminate unnecessary intermediation, and ensure rigorous scrutiny of high-value service awards.

While the exact impact this memorandum will have on contractors is still unclear, contractors working in the ITC&MS or A&AS space can take several steps to reduce their risk:

  • Preempt DOGE scrutiny with clear justifications: Articulate in your proposal how your services provide unique value and cost-effective support.
  • Clarify your role: Emphasize direct mission-critical support—especially for exempt programs. Avoid generic management consulting language that could trigger heightened scrutiny.
  • Collaborate with agency customers: Work early with DoD contracting and program officials to help them develop the rationale for approving your contract or identifying an applicable exception.
  • Streamline pricing and deliverables: Clearly define work products, performance metrics, and accountability mechanisms.
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The Bottom Line: Cost and Pricing Updates | Act of God or Compensable Delay?

Stephanie M. Harden ●

Welcome to The Bottom Line: Cost and Pricing Updates, a new series covering what contractors should know about recent cost and pricing disputes—without the long read!

For our inaugural post, we present:

Appeal of Gideon Contracting, LLC, ASBCA No. 63561 (May 12, 2025)

The Bottom Line: When the Government orders a suspension of work due to an “act of God,” it may still be on the hook for the resulting increased costs under the Suspension of Work clause if it proximately causes an unreasonable delay. Here, the Government proximately caused the delay at issue through its management of water drainage through a lake and dam, including through controlled releases of water, and the Armed Services Board of Contract Appeals (“ASBCA” or “the Board”) found a portion of the delay to be unreasonable.

Key points of interest:

  • Generally, “acts of God” entitle contractors to additional time, but not additional compensation. However, the distinguishing feature entitling Gideon to additional compensation here was that the Government controlled the release of floodwaters via a drainage management system. Thus, the flooding was not caused solely by rainfall, as the Government argued, but rather, by the Government’s release of floodwater.
  • Gideon was not entitled to damages for the entire suspension period, however, because the contract specified when and how water releases would occur. Therefore, Gideon was only entitled to compensation for portions of the suspension that were found to be “unreasonable” (or as described by the Board, inexplicable).

Contractors facing suspensions of work should carefully evaluate whether their contracts may entitle them to relief where at least a portion of such suspensions are “unreasonable.”

Blank Rome’s Government Contracts Practice and Attorneys Highly Ranked in Chambers USA 2025

Blank Rome’s Government Contracts practice was ranked in Band 2 in Government Contracts: The Elite, USA in the Chambers USA 2025 rankings, placing our team among the top 10 law firms in the nationwide rankings.

Chambers quoted a government contracts reference as saying that “The firm has specialized expertise as well as a broader perspective on the issues at play.”

Chambers USA included four of our attorneys in their 2025 Government Contracts rankings: Dominique L. Casimir, Justin A. Chiarodo, Elizabeth N. Jochum, and Luke W. Meier, with Elizabeth receiving an additional ranking for “Government Contracts: Bid Protests.”

To view all of Blank Rome’s Chambers USA 2025 rankings, please visit our website.

Department of Justice Announces New Initiative to Combat Civil Rights Fraud Using the False Claims Act

Dominique L. Casimir, Jennifer A. Short, and Brooke T. Iley ●

Jennifer A. Short headshot image

From time to time, the Department of Justice (“DOJ”) has established initiatives, task forces, or strike teams to advance its enforcement priorities. In recent years, DOJ has announced a Procurement Collusion Strike Force, a COVID-19 Fraud Enforcement Task Force, and a Civil Cyber-Fraud Initiative, in each instance explicitly invoking a plan to use the False Claims Act (“FCA”) for civil enforcement. 

DOJ announced the latest version of this enforcement approach on May 19, 2025, when Deputy Attorney General Todd Blanche issued a memorandum announcing a new Civil Rights Fraud Initiative (“the Initiative”), described as a coordinated and “vigorous” effort to leverage the specter of FCA liability against recipients of federal funding alleged to be violating civil rights laws. The types of alleged civil rights violations targeted by this Initiative relate to diversity, equity, and inclusion (“DEI”) programs, antisemitism, and transgender policy, all of which dovetail with a number of Executive Orders (“EOs”) expressing President Trump’s approach to these issues.

Relevant Executive Orders

Some of the EOs relevant to the Civil Rights Fraud Initiative include:

EO No. 14151: Ending Radical and Wasteful Government DEI Programs and Preferencing (January 20, 2025). This EO directs federal government agencies to end DEI and diversity, equity, inclusion, and accessibility (“DEIA”) programs, to eliminate positions such as “Chief Diversity Officer,” and to terminate grants and contracts related to DEI and DEIA. It also orders a review of federal employment practices to ensure they focus on individual merit rather than DEI factors.

EO No. 14168: Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government (January 20, 2025). This EO declares, as United States’ policy, that there are two immutable sexes (male and female), based on biological reality. It requires changes to government-issued identification documents and prohibits federal funding for so-called “gender ideology.”

EO No. 14173: Ending Illegal Discrimination and Restoring Merit-Based Opportunity (January 21, 2025). This EO requires that all federal contracts and grants include a certification that recipients do not operate any DEI programs that violate applicable antidiscrimination laws and affirms that compliance with federal anti-discrimination laws is material to government payment decisions. Additionally, the EO directs DOJ to identify key sectors and entities for DEI-related enforcement, and to recommend strategies to end “illegal DEI discrimination” in the private sector.

EO No. 14188: Additional Measures To Combat Anti-Semitism (January 29, 2025). This EO reaffirms EO 13899 from December 11, 2019, which aimed to combat antisemitism, particularly in educational institutions. It directs various federal agencies to identify actions to curb antisemitism and recommends monitoring foreign students and staff for antisemitic actions.

EO No. 14201: Keeping Men Out of Women’s Sports (February 5, 2025). This EO aims to exclude transgender individuals from competing in women’s sports. It directs the Secretary of Education to rescind funding from educational institutions that do not comply.

Read the full client alert on our website.

Disagreeing with the Supreme Court, the Ninth Circuit and Two District Courts Find APA Jurisdiction in Challenges to Federal Contract and Grant Terminations

Dominique L. Casimir and Sara N. Gerber ●

One of the immediate priorities of the second Trump administration has been the termination of a slew of federal contracts and grants. This, predictably, has led to litigation, mostly filed in the U.S. District Courts, which as we have previously written, have authority to grant equitable relief. The government has been arguing that these cases belong in the U.S. Court of Federal Claims, where only monetary damages are available (and only upon meeting the high burden of establishing that the government acted in bad faith). On April 4, 2025, the Supreme Court issued an emergency stay of a District Court’s preliminary injunction in a case challenging grant terminations, with the five-justice majority suggesting that the termination case belonged in the Court of Federal Claims. But since then, two U.S. District Courts and the Ninth Circuit Court of Appeals have ruled—contrary to the Supreme Court’s emergency stay order—that there is indeed district court jurisdiction in cases challenging contract and grant terminations. As Judge Young of the District Court of Massachusetts stated, “…this Court, after careful reflection, finds itself in the somewhat awkward position of agreeing with the Supreme Court dissenters and considering itself bound by the still authoritative decision of the Court of Appeals of the First Circuit…” which ruled that the Tucker Act did not apply, and that the government’s actions were reviewable under the Administrative Procedures Act (“APA”).

Continue reading “Disagreeing with the Supreme Court, the Ninth Circuit and Two District Courts Find APA Jurisdiction in Challenges to Federal Contract and Grant Terminations”

An Update on the DEI Certification Provision of Executive Order 14173

Dominique L. Casimir ●

On May 2, 2025, the United States District Court for the District of Columbia denied Plaintiffs’ Motion for a Preliminary Injunction in National Urban League et al. v. Trump, et al., 25-471, a case that seeks to halt enforcement of President Trump’s executive orders (“EOs”) related to diversity, equity, and inclusion (“DEI”), EO 14151 and EO 14173, as well as EO 14168, regarding so-called “Gender Ideology.” At this point two tribunals have ruled that the DEI-related EOs should not be enjoined pending legal challenges. (The other tribunal to take this position is the U.S. Court of Appeals for the Fourth Circuit which stayed a nationwide preliminary injunction of the DEI-related EOs issued by the District Court of Maryland.)

Government contractors are particularly interested in the DEI Certification provision in Section 3(b)(iv)(A) and (B) of EO 14173, which requires each agency of the government to include two terms in every contract or grant award: one requiring the counterparty “to certify that it does not operate any programs promoting DEI that violate any applicable Federal antidiscrimination laws,” and another requiring it to agree that compliance with those laws “is material to the government’s payment decisions for purposes of” the False Claims Act (“FCA”), 31 U.S.C. § 3729(b)(4). (We have previously done a deep dive on FCA liability premised on DEI programs.)

Continue reading “An Update on the DEI Certification Provision of Executive Order 14173”

Hybrid Event: Export Controls Amid Evolving Trump 2.0 Trade Dynamics: Policy Updates and Best Practices

April 29, 2025
12:00–2:00 p.m.
McLean, Virginia, or online

Blank Rome partners Anthony Rapa, partner & co-chair of the International Trade group, and Justin A. Chiarodo, partner & co-chair of the Government Contracts group, will join Sol Brody (Vice President, International Trade Licensing & Sanctions, BAE Systems, Inc.) to present the Association of Corporate Counsel National Capital Region’s (“ACC NCR”) hybrid event, “Export Controls Amid Evolving Trump 2.0 Trade Dynamics: Policy Updates and Best Practices,” on Tuesday, April 29, 2025. The event will be held from 12:00 to 2:00 p.m. in McLean, Virginia, with a virtual participation option available.

ABOUT THE PROGRAM

This hybrid (in-person and online) program will cover up-to-the minute developments in the export controls landscape, one of the linchpins of the Trump administration’s national security strategy and “America First” trade policy. This will include the latest regarding semiconductor export controls, controls relating to emerging technologies, China-focused restrictions, anticipated Russia-related developments, ramped-up government enforcement, and best practices in an ever-changing environment.

For more information and to register, please visit the registration page and select the “Speaker/Panelist” registration option to register for free.