MA Plans Can Require Step Therapy for Part B Drugs

From RADAR on Drug Benefits

In a move that industry analysts see as a positive development for the managed care sector, CMS issued new guidance that will allow Medicare Advantage (MA) plans to use step therapy for Part B drugs starting in 2019.

The change will allow them to require that patients try a lower-cost treatment before using a higher-cost one. HHS estimates the new policy could result in savings of between 15% and 20%, said Daniel Best, HHS Secretary Alex Azar's senior adviser for drug pricing reform.

CMS is also giving MA plans that offer a Part D benefit the ability to "cross-manage" drugs across Part B and Part D. In other words, plans could require patients to try alternatives covered within Part D before moving on to relatively expensive physician-administered drugs in Part B, Credit Suisse analyst A.J. Rice explained in a research note.

However, he cautioned that with step therapy adoption optional for the 2019 plan year and a lack of clarity around formal rulemaking, shared savings arrangements and beneficiary adoption, "MA plans may be cautious in adopting step therapy."

Deb Devereaux, senior vice president of pharmacy at Gorman Health Group, points out that MA plans' formulary submissions were already completed in June, and CMS is well on its way through the formulary review stages.

Devereaux says the new policies will "potentially" help lower drug prices. More importantly, she says, CMS’s move will allow MA plans to implement already-existing treatment guidelines that call for trying certain medications before using another one.

However, she adds it may not be easy for PBMs to implement the new guidelines right away, since MA plans' coverage decisions often involve nurses, which PBMs don't typically employ.

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