by Leslie Small
In 2021, about half of enhanced stand-alone Prescription Drug
Plans (PDPs) and a little more than a third of Medicare Advantage-Prescription
Drug (MA-PD) plans will participate in a new demonstration that aims to lower
diabetic seniors' out-of-pocket costs by capping copays at $35 for a broad set
of insulin products, according to a new analysis by consulting firm Avalere Health.
Among the 310 enhanced PDPs that opted to participate in CMS's
Part D Senior Savings Model for 2021, the average enrollment-weighted premium
is $57.53 — $23.46 higher than the average premium for non-participating plans,
the analysis found. But in the MA-PD space, the average enrollment-weighted
premium for the 1,287 participating plans is $10.36 less than the cost of
non-participating plans ($22.74 versus $33.10).
Tom Kornfield, one of the co-authors of the Avalere report and a
senior consultant with the firm, says one reason why PDPs with higher premiums
tended to participate in the demonstration may be that "the additional
protections [for consumers] cost the plans more money, so they’re increasing
their bids as a result of that."
Regarding why the average premium for participating MA-PD plans
is lower than non-participating plans, Kornfield notes that, unlike stand-alone
PDPs, such plans can reap the benefits of any cost savings associated with the
demonstration’s ability to improve medication adherence and diabetes
management.
CMS unveiled the Part D Senior Savings Model in March, and in
May it said that 1,750 PDPs and MA-PD plans applied to participate, as well as
the three major insulin manufacturers: Eli Lilly and Co., Novo Nordisk Inc. and
Sanofi SA.
For seniors who sign up for plans that participate in the new
model, the main benefit is a maximum copay of $35 each for a month’s supply of
insulin while in the deductible, initial coverage and coverage-gap phases of
the Part D benefit, rather than cost-sharing amounts that vary by coverage
phase.
Kornfield says he was somewhat surprised that so many plan
sponsors opted into the demonstration for 2021. "I don’t know that I
anticipated quite as much participation, but having said that, the major
insulin manufacturers are all voluntarily participating in the demonstration,
so I think that makes a big difference."
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