Reuters Staff AUGUST 7,
2018
(Reuters) - The Trump
administration said on Tuesday it would give Medicare Advantage health plans
for the elderly new tools to negotiate for lower prescription drug prices.
The Centers for
Medicare and Medicaid Services (CMS) said Medicare Advantage plans will be
allowed to require that patients first try certain lower-cost drugs before
moving to a more expensive alternative if the first treatment is not effective.
Medicare Advantage
plans are administered by private health insurers, such as Aetna Inc (AET.N) and Humana Inc (HUM.N), and cover medical benefits for some 20 million seniors.
Until now, such
requirements could not be made on drugs covered by Medicare Part B, which are
administered in a hospital or doctor’s office.
The changes also
affect Medicare Part D drugs that patients get at the pharmacy. The Medicare
Advantage plans would be allowed to require patients try alternatives covered
within Part D before moving on to physician administered drugs, that are
typically much more expensive.
In 2017, Medicare
Advantage plans spent $11.9 billion on Medicare Part B drugs. These types of
changes in the private market have generally resulted in savings of about 15
percent to 20 percent, according to the Department of Health and Human
Services.
More than half of the
savings will be required to be passed on to patients, CMS said.
U.S. President Donald
Trump has made lowering prescription drug costs for U.S. consumers a top
priority. He announced a blueprint for lower healthcare costs in May and his administration
has been announcing new initiatives this summer.
The changes announced
on Tuesday can take effect as early as 2019.
Medicare Advantage plans that choose to implement the so-called
step therapy will be required to disclose the change to patients. They would be
allowed to switch to another Medicare Advantage plan or to fee-for-service by
March 31.
Reporting by
Michael Erman and Michele Gershberg; editing by James Dalgleish and Bill
Berkrot
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