The Centers for Medicare and Medicaid Services (CMS) recently announced a new policy affecting Medicare Advantage plans, specifically those Medicare Advantage beneficiaries who rely on prescription drugs from Medicare Parts B and D. This new CMS guidance effective, January 1, 2019, permits MA plans to use “step therapy” for Part B drugs as part of a patient-centered care coordination program. Simply put, step therapy would require physicians to write prescriptions for a less expensive alternative drug and see if it succeeds or fails before writing for some additional expensive medications. In what will likely end up resulting in unnecessary costs and delays many providers including national oncology organizations have publicly criticized the guidance as removing patient and physician choice and harming individualized treatment.
Not surprisingly, the PBM lobbying group, Pharmaceutical Care Management Association (PCMA), has publicly favored the guidance. The big three PBMs have common ownership with MA Plans. The new rule will allow Part D plans the ability to cross-manage drug decisions across Part B and Part D. Instead of a physician choosing what drug to prescribe, the PBM would decide through Step Therapy. Under the previous CMS rule, PBMs had little control over Part B drugs—that was the domain of physicians. The new rule will embolden the PBMs’ ability to control dispensing with step therapy; will enable PBMs to control formulary design, thus allowing them to secure even greater “rebates” from manufacturers and better spread pricing. PCMA called for this rule change in its July 16, 2018 Statement to Secretary Azar regarding the American Patients First: Blueprint to Lower Drug. Unfortunately, the consequence of this rule will be to increase the list price of drugs and patient copayment, particularly for those suffering from serious disease states.
The issue for the industry now is how to deal with the possibility of higher out of pocket costs, uncertain patient outcomes and unnecessary interference with the doctor patient relationship. The first piece of advice for Part B and Part D providers is to be vigilant in your response to the increasingly utilized Request for Information (RFI). The Request for Information is a method that agencies extend to interested stakeholders to identify issues of concern to the industry that could be technical in nature. It is strongly encouraged that you reach out to agencies offering RFIs such as this would could help avoid policy changes that hurt patient care and provider autonomy.
Over the last 12 months, CMS has increasing relied on the issuing of Requests for Information (RFIs). An RFI is part of the rulemaking process wherein an agency, such as CMS, proposes a rule or policy that it is looking to either add or change. Proposed rule announcements are usually followed by a “comment period”, public workshops/hearings, a final comment period and then a final rule with effective date. The RFI process provides opportunities for industry stakeholders, including national associations, to comment on the technical aspects of a proposal. However, the Administration is using agencies like CMS to distribute RFIs as a way for the industry to guide the conversation on what should be included. This could provide your organization with another way to influence policy.
It is clear that the pace of federal and state government policy making in the healthcare and life sciences spaces has quickened and continues to raise the stakes for market participants. Frier Levitt Government Affairs, LLC, along with legal insight from Frier Levitt, LLC, helps physician dispensers and specialty pharmacies navigate market and policy changes and helps provide the necessary tools to stay ahead. Contact us today.