The Centers for Medicare and Medicaid Services (CMS) announced a Proposed Rule to amend Medicare Advantage (MA) regulations and Prescription Drug Benefit program (Part D) regulations.  The Proposed Rule will be published on November 30, 2018.

The Proposed Rule is intended to help lower drug prices for health and drug plans and reduce out-of-pocket costs for MA and Part D enrollees. Major provisions include:

• Providing Plans with increased flexibility in managing drug formularies. Current policy requires Part D formularies to include all drugs in the following categories: (1) antidepressants; (2) antipsychotics; (3) anticonvulsants; (4) immunosuppressants for treatment of transplant rejection; (5) antiretrovirals; and (6) antineoplastics; except in limited circumstances. The Proposed Rule includes three exceptions, allowing:

(1) broader use of prior authorization and step therapy;

(2) exclusion of drugs that are only a new formulation of an existing single-source drug or biological product, regardless of whether the older formulation remains on the market; and

(3) exclusion of drugs with a price increase beyond an inflation-based threshold relative to a baseline month and year.

The Proposed Rule would also allow Part D sponsors to exclude a drug from the formulary for non-protected indications.

• Updating E-Prescribing Standards to require each Part D plan to implement prior to 2020 an electronic real-time benefit tool (RTBT) with the ability to make beneficiary-specific drug coverage and cost information visible to prescribers who want to consider that information when prescribing. The RTBT would need to be capable of integrating with prescribers’ e-Prescribing (eRx) and electronic medical record (EMR) systems.
• Requirements for MA plans to apply step therapy as a utilization management tool for Part B drugs, and modifications of adjudication time periods for organization determinations and appeals involving Part B drugs.
• CMS’ intent to consider, for a future year (not yet specified), eliminating the exception for contingent pharmacy price concessions. If this were to transpire, the “point-of-sale” price for Part D drugs would include all discounts, subsidies or rebates that reduce the drug costs to Part D plans. The point-of-sale drug price is also used to calculate beneficiary cost shares.

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