Alliance for Aging Research says utilization
management practices such as step therapy and prior authorization
could limit access to lower prescription drug prices and a
cap on out-of-pocket costs at the pharmacy counter
WASHINGTON, July 12,
2024 /PRNewswire/ -- While the Inflation Reduction
Act (IRA) makes significant changes to the Medicare Part D
prescription drug benefit and directs the Centers for Medicare and
Medicaid Services (CMS) to impose government-negotiated prices for
the drugs with the most Medicare spending, a new report details how
some of the potential benefits may be unrealized absent action by
CMS. If the agency does not place guardrails on insurers and
contracted pharmacy benefit managers, beneficiaries may experience
reduced access and lower-than-expected savings from the Medicare
Drug Price Negotiation Program.
"We hope that this paper serves as a useful
roadmap for policymakers and a tool for patient advocates."
"For many older adults, interruptions or excessive delays in
access to their medications are not just an inconvenience—they can
threaten health and independence," said Adina Lasser, Public
Policy Manager at the Alliance for Aging Research. "We encourage
the Medicare program to use its existing authorities, which are
clearly outlined in this report, to better protect the
beneficiaries they serve."
According to the report from Manatt Health, sponsored by
the Alliance for Aging Research, Medicare Part D prescription drug
plan (PDP) sponsors face heightened costs as they bear more
financial risk under the IRA's benefit changes, and they will lose
manufacturer rebate revenue when CMS negotiates the prices of drugs
selected for negotiation. These factors may prompt plans to protect
their financial margins by limiting access to drugs through
narrower formularies, adopting more rigorous utilization management
strategies like prior authorization or step therapy that will delay
or deny access to therapy, or promoting drugs other than those CMS
has selected for negotiation so as to protect their rebate
revenue.
As part of IRA implementation and in advance of calendar year
2025, during which many changes to the design of the Part D benefit
take effect, CMS could take steps to protect beneficiaries by
preserving access and increasing transparency. CMS has already
warned PDP sponsors not to place drugs selected for negotiation on
non-preferred formulary tiers without clinical justification. But
it can do more under its current legal authority,
including:
- Require that drugs selected for negotiation—for which CMS has
established a maximum fair price—be given preferred formulary
status, without utilization management.
- Adopt a public "watchlist" for specific adverse formulary
decisions that CMS will not approve, to keep PDP sponsors from
excessive narrowing of formularies.
- Commit additional resources to formulary reviews so as to
identify access issues before such issues can harm
beneficiaries.
- Explicitly and publicly identify more situations where plans
must cover more than two drugs per category or class to ensure that
formularies provide adequate coverage of drugs commonly used by
beneficiaries.
- Improve plan transparency so beneficiaries can more easily see
when drugs have utilization management restrictions.
- Enforce minimum payment rates to pharmacies, to prevent
sponsors from diverting patients away from community
pharmacies.
- Actively monitor appeals, grievances and exception requests
filed by beneficiaries with their plans, to have near real-time
view of access issues.
- Improve appeals and grievance processes to reduce the burden of
challenging a plan's coverage decision.
- Adopt new actuarial equivalence tests to more accurately and
quantitatively track whether plan sponsors are offering sufficient
coverage of drugs selected for negotiation.
This paper discusses in detail the coming changes to Part D,
some of the risks faced by beneficiaries as a result of plan
sponsors changing behaviors in response to the IRA, the initial
measures taken by CMS to date to protect beneficiaries, and
steps CMS could take under its current legal authority to better
protect timely beneficiary access to therapy.
"We hope that this paper serves as a useful roadmap for
policymakers and a tool for patient advocates," Lasser continued.
"Implementation of the recommendations outlined in this paper would
make a world of difference to older adults and all Medicare
beneficiaries who depend on timely and affordable access to their
medications."
To read the full report,
visit https://www.manatt.com/Manatt/media/Documents/Articles/AAR-Patient-Impact-of-the-IRA_2024-06_d.pdf.
About the Alliance for Aging Research
Since 1986, the Alliance for Aging Research has served as a trusted
source of health information for both consumers and health care
professionals on diseases and conditions that disproportionately
affect older adults and has led numerous successful advocacy
campaigns promoting the health and independence of older adults.
The Alliance is dedicated to changing the narrative to achieve
healthy aging and equitable access to care. We strive for a culture
that embraces healthy aging as a greater good and values science
and investments to advance dignity, independence, and equity. Learn
more about the Alliance at www.agingresearch.org.
Contact:
Katie Riley
kriley@agingresearch.org
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SOURCE Alliance for Aging Research