USP Releases Proposed Guidelines for Medicare Prescription Drug Benefit Formulary
The United States Pharmacopeial Convention, the organization hired by Medicare to develop a formulary for the prescription drug benefit, on Monday released its proposed list of prescription drug classes to be covered under the program beginning in 2006, the New York Times reports. The drug benefit will be delivered through private drug plans, and each plan will develop a list of medications for reimbursement.
According to the Times, while drug companies generally would like as many medications as possible to be included on the list, insurers and pharmacy benefit managers are more likely to want to limit the number and types of medications. USP's formulary appears to "come down in favor of the insurers more than the drug companies," the Times reports.
USP first released a draft of the proposed formulary in August (Pear, New York Times, 1/4). The draft included 146 types of medications that Medicare should cover, such as antidepressants, HIV/AIDS medications, anti-cholesterol treatments and anti-inflammatory medications (California Healthline, 10/8/04).
The formulary released Monday retains the 146 types of prescription drugs. It includes 41 categories, 32 of which are further broken down into drug classes (Lueck, Wall Street Journal, 1/4).
USP specified that the private drug plans should offer beneficiaries at least two drugs in each category. USP also suggested that drug plans should cover at least one product from each subclass within a category and said that Medicare officials should require insurers to justify the exclusions of drug subclasses by providing "substantial clinical, scientific or other rationale."
Roger Williams, executive vice president of USP, said that insurers are "not required by law to use the model guidelines," but the Bush administration should encourage them to do so because "the use of a single standardized structure" for prescription drug formularies would allow
Medicare beneficiaries to more easily compare drug plans. He added that the USP's guidelines are "the only classification system specifically developed" to ensure that Medicare beneficiaries have access to all needed prescription drugs.
CMS Administrator Mark McClellan "praised the framework" developed by USP and "emphasized" that CMS "would be the final arbiter of what kinds of drugs must be covered" in a health plan, the Times reports (New York Times, 1/4). He said, "We will use the USP's work to make sure that beneficiaries will have access to the prescription drugs they need at the most affordable price" (Wall Street Journal, 1/4).
In making its decisions, the federal government is expected to analyze the list of drug classes, as well as specific drugs in each class, copayments charged for each drug, prior authorization requirements and procedures for patients to appeal drug-coverage decisions, McClellan said (New York Times, 1/4). The federal government has "signaled that it is open to approving drug plans with different structures," the Wall Street Journal reports.
CMS is expected to release the final formulary regulation soon, the Journal reports (Wall Street Journal, 1/4).
Alissa Fox, policy director for the Blue Cross and Blue Shield Association, said the proposed guidelines "go in the right direction for Medicare beneficiaries."
Karen Ignagni, president of America's Health Insurance Plans, said, "This is a good step, a model that our plans will look at." However, she added that it is "too early to say how many plans" will follow the guidelines closely.
The Pharmaceutical Research and Manufacturers of America had "urged" USP to "scrap its first draft and start over," but USP "rejected" that advice and "appear[ed] to come down in favor of the insurers more than the drug companies," the Times reports (New York Times, 1/4). Paul Antony, chief medical officer for PhRMA, said the formulary is just "one of several factors" CMS will weigh when reviewing drug plans, adding, "We expect the full process will meet the needs of patients and physicians."
The Pharmaceutical Care Management Association said in a statement that the proposed guidelines "preserve the ability of PBMs to develop formularies" similar to those available through private insurers (Wall Street Journal, 1/4).
However, some consumer advocates expressed concern about the number of drug classes included in the formulary, the Times reports. Stephen McConnell, senior vice president of the Alzheimer's Association, said, "People with Alzheimer's often suffer from other chronic conditions, including heart and lung disease, and they may not be able to get the drugs they need for those conditions. In addition, some of the newer antidepressants may not be available."
C. Conrad Johnston, former president of the National Osteoporosis Foundation, said the proposed guidelines provide "little assurance of protection for millions of Medicare beneficiaries with osteoporosis" (New York Times, 1/4).
The proposed formulary is available online. Note: You must have Adobe Acrobat Reader to view the guidelines.
The Washington Post on Tuesday examined the new preventive care benefits available through Medicare beginning this week. The benefits include a "Welcome to Medicare" physical examination for new beneficiaries, cardiovascular screening blood tests every five years for all Part B beneficiaries, and annual or biannual diabetes screening for all beneficiaries considered at risk for developing the condition.
According to a statement by CMS in December, the new preventive benefits "could save many thousands of lives and billions of dollars in avoidable medical expenses for preventable complications." The agency has not provided "firm estimates" on potential savings, and some experts say it is unclear whether enough beneficiaries will take advantage of the new services to result in significant savings, the Post reports.
CMS has estimated that the new benefits will cost Medicare approximately $2.1 billion from fiscal year 2005 through fiscal year 2013, according to the Post (Mann, Washington Post, 1/4).
NPR's "Morning Edition" on Tuesday reported on upcoming health policy issues, including the new Medicare prescription drug benefit and Medicaid and Medicare's cost to state and federal budgets. The segment includes comments from NPR Health Policy Correspondent Julie Rovner (Rovner, "Morning Edition," NPR, 1/4). The complete segment is available online in RealPlayer.This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.