The Trump administration is extending its push for price transparency to Medicare Part D.
The Centers for Medicare & Medicaid Services (CMS) issued (PDF) the second part of its annual Advance Notice governing Medicare Advantage (MA) and Part D plans Wednesday. In it, the agency is proposing a requirement for plans to offer real-time pricing comparisons to members.
CMS last year finalized a plan that requires Part D plan sponsors to make that available to providers beginning in 2021. If the new proposal is put in place, Part D plans would have to offer real-time drug pricing data to members in 2022.
Plans would be required to offer direct price comparisons between formulary options and provide data on cost sharing, which “puts important information in the hands of consumers,” CMS Administrator Seema Verma said on a call with reporters Wednesday.
“It’s very consistent with all of the efforts that we’ve been doing around price transparency,” Verma said.
Arming patients with pricing data and the ability to comparison shop between therapies pushes plan sponsors and pharmaceutical companies to compete for lower prices, she said.
In addition, CMS has proposed allowing Part D plans to offer a second specialty drug tier on their formulary for “preferred” specialty medications, allowing for more options with lower cost sharing.
The specialty tier is the costliest, and adding the second drug tier would arm plan sponsors with greater leverage to negotiate with drugmakers that want their products on that tier, Verma said.
Other proposals in the rule include:
- An average MA rate increase of 0.93% for the 2021 plan year. The agency estimates risk scores could go up by 3.6% on average when accounting for underlying coding trends.
CMS finalized a 2.53% rate increase for the 2020 plan year.
- Star ratings adjustments that consider a Part D plan’s use of generics and MA star ratings to reflect beneficiary feedback.
Verma said the goal is to encourage Part D plan sponsors to either expand coverage of generics or to incentivize them to push members to use these lower-cost drugs. In MA, the goal is to include data that more effectively reflect how members feel about their plans.
“One of the best indications is what its members think,” she said.