CMS Announces Changes to Part D Payment Modernization Model

The Biden administration has walked back a last-minute bid by its predecessor to give Medicare Part D plans the ability to restrict access to certain classes of drugs such as antidepressants. The Centers for Medicare & Medicaid Services (CMS) announced a change on to the Part D Payment Modernization Model, a voluntary model that tests changes to the program.

It walked back two changes set to take effect in 2022 that offered insurers more flexibility on how they structure their formularies. The Trump administration announced the two controversial changes on January 19, a day before President Biden’s inauguration.

Policy Change

CMS announced that it would roll back changes to a Part D demonstration that would have weakened Medicare’s prescription drug coverage patient protections. The agency released an updated Request for Applications (RFA) for the Part D Payment Modernization (PDM) Model for CY 2022 eliminating the changes, which were proposed in the final days of the Trump administration.

In the initial RFA for the calendar year (CY) 2022 performance period, the Trump administration announced that it would allow model participants to treat Medicare’s six protected classes as they would any other drug class and cover only one drug per therapeutic class. CMS noted in today’s announcement that stakeholder feedback was a major consideration in the decision to not move forward with the changes.

Under current statute and regulation, Medicare Part D plans are required to cover two drugs in each therapeutic class, with the exception of six protected classes, of which plans must cover substantially all drugs. The six protected classes are antipsychotics, anticonvulsants, antidepressants, antiretrovirals, antineoplastics, and immunosuppressants for organ transplant.

The Trump administration’s last-minute changes to the model for CY 2022 would have allowed participants to waive the requirement that substantially all protected class drugs be covered, with the exception of antiretrovirals. Antiretrovirals would have joined the other classes in being waived beginning CY 2023. Additionally, CMS had announced that it would allow participating plans to cover just one drug in each therapeutic class rather than the current requirement of two. This lessened coverage requirement would have applied to protected class drugs in participating plans, as well.

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