CMS Issues Final Rule on MA, Part D  

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Original story posted on: January 27, 2021

Estimated savings are $75 million over a decade.

Federal officials recently announced a series of changes to the Medicare Advantage (MA) and Part D prescription drug programs they hope will save tens of millions of dollars and also allow beneficiaries to make more informed purchasing choices.

The Centers for Medicare & Medicaid Services (CMS) announced the changes via a final rule that generally becomes effective for the 2022 plan year and could lower enrollee cost sharing on some of the most expensive prescription drugs available. Initial estimates projected $75.4 million in savings to the federal government over 10 years.

“The changes in this final rule provide desperately needed transparency on the out-of-pocket costs for prescription drugs that have been obscured for seniors,” Former CMS Administrator Seema Verma said in a statement. “It will strengthen Part D plans’ negotiating power with prescription drug manufacturers, so American patients can get a better deal.”

Tying in to the federal push for price transparency across the healthcare sector, the final rule will require Part D plans to offer a real-time benefit comparison tool, starting Jan. 1, 2023, so enrollees can obtain information about lower-cost alternative therapies under their prescription drug benefit plans.

Officials offered the following example: if a doctor recommends a specific cholesterol-lowering drug, the enrollee could look up what the co-pay would be and see if a different, similarly effective option might be cheaper – allowing them to know in advance what they will need to pay before heading to the pharmacy. It follows a similar CMS requirement that Part D plans support a prescriber real-time drug benefit tool that went into effect at the start of the current year.

“In the Medicare Part D program, enrollees choose the prescription drug plan that best meets their needs. Many plans offering prescription drug coverage place drugs into different ‘tiers’ on their formularies,” CMS noted in a press release. “Today, all drugs on a plan’s specialty tier – the tier that has the highest-cost drugs – have the same level of cost sharing. Under the final rule, CMS is allowing Part D plans to have a second, ‘preferred’ specialty tier with a lower cost sharing level than their other specialty tier. This change gives Part D plans more tools to negotiate better deals with manufacturers on the highest-cost drugs and lower out-of-pocket costs for enrollees in exchange for placing these products on the ‘preferred’ specialty tier.”

For a fact sheet on the final rule, go online to: https://www.cms.gov/newsroom/fact-sheets/contract-year-2022-medicare-advantage-and-part-d-final-rule-cms-4190-f2-fact-sheet

The final rule can also be downloaded in its entirety from the Federal Register at: https://www.federalregister.gov/public-inspection/2021-00538/medicare-and-medicaid-programs-contract-year-2022-policy-and-technical-changes-to-the-medicare

Mark Spivey

Mark Spivey is a national correspondent for RACmonitor.com, ICD10monitor.com, and Auditor Monitor who has been writing and editing material about the federal oversight of American healthcare for more than a decade. He can be reached at mcspivey@hotmail.com.

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