Medicare
Advantage plans may now use step therapy for Part B and some Part D drugs, a
protocol CMS said will reduce out-of-pocket costs for patients.
By Sara Heath
August 07, 2018 - CMS
has given new authority to Medicare
Advantage plans that allows those plans to negotiate lower drug prices. These
new policies will specifically allow Medicare Advantage Plans to practice step
therapy, which CMS says will create cost cuts that can reduce out-of-pocket
costs for patients.
The new policy will also allow Medicare
Advantage plans to cross-manage across Part B and Part D where applicable.
“President Trump promised better
Medicare negotiation and lower drug prices for the American people. Today, we
are taking an important step in delivering on that promise,” HHS Secretary Alex
Azar said in a statement.
“As soon as next year, drug prices can
start coming down for many of the 20 million seniors on Medicare Advantage,
with more than half of the savings going to patients,” he continued. “Consumers
will always retain the power to choose the plan that works for them: If they
don’t like their plan, they don’t have to keep it. We look forward to seeing
the results of tougher negotiation within Medicare, and expanding successful
negotiation tools throughout our programs.”
Step therapy is a cost-cutting practice
in which payers begin a patient on a low-cost medication regimen, usually using
a biosimilar. The patient remains on that treatment until she and her doctor
determine that a costlier drug may be necessary.
CMS said these changes only apply to
newly-prescribed medications and may begin on January 1, 2019.
Medicare Advantage plans may employ
step therapy on Part B drugs, which currently account for approximately $12
million in Medicare costs. With some Medicare Advantage plans cross-managing
certain prescriptions between Part B and Part D, patients may need to complete
step therapy for their Part D prescriptions, as well.
CMS said cross managing between Part B
and Part D will increase competition. Often, a Part B drug will have an
extraordinary cost because its competitor is listed as a Part D treatment. With
cross management, these drugs will now be in competition with each other, ideally
reducing costs, CMS suggested.
Patients may see lower drug costs due
to these changes, CMS explained. When a Medicare Advantage plan saves money
from step therapy, it will be required to pass on over half of its savings to
patients through lower coinsurance or rewards programs. Starting in 2020, CMS
said plans can pass on savings through lowered premiums.
Flexibility for step therapy comes with
some patient protections, CMS reported. Plans must explicitly communicate its
new approach to step therapy to patients through the Annual Notice of Change
and Evidence of Coverage documents. This notification can prompt patients who
no longer wish to participate in that plan to select a new one.
CMS also said Medicare Advantage plans
must practice considerable care coordination during the step therapy process to
ensure more value to the patient. Care coordination must include discussing
medication options with beneficiaries, driving patient education about their
medications, and implementing medication adherence protocol.
“Under the President’s leadership, for
the first time ever, CMS is bringing negotiations to physician-administered
drugs and delivering on our promise to lower drug prices for patients,” said
CMS Administrator Seema Verma. “For too long, Medicare Advantage plans have not
had the tools to negotiate a better deal for patients. Today we begin lifting
those barriers so plans can use private-sector tools to drive down the cost of
expensive drugs while also offering new care coordination and drug adherence
programs, to ensure that patients are getting high quality care at lower cost.”
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