Dive Brief:
- The Medicare Payment Advisory Commission (MedPAC), which advises Congress on Medicare issues, is set to recommend several proposals to Congress this week that would significantly impact the Medicare Part D program, according to Avalere, which analyzed the proposals following MedPAC's April meeting.
- The recommendations include changes to cost-sharing requirements that would affect many of Medicare Part D's 42 million beneficiaries.
- The changes would result in cheaper generic and biosimilar drugs for low-income beneficiaries, and higher cost-sharing levels for those with higher incomes, Avalere's report concluded.
Dive Insight:
In short, low-income subsidy (LIS) beneficiaries stand to gain from the proposals while non-LIS beneficiaries may have to absorb multiple changes that could increase their costs.
Of the 42 million+ Part D enrollees, almost 12 million are LIS beneficiaries. Among the changes they could see are reduced or eliminated cost-sharing for generic drugs and biosimilars to encourage broader use of those options vs. name-brand products, Avalere said, because currently LIS-eligible beneficiaries are selecting generics at a lower rate (81%) than non-LIS beneficiaries (85%).
Non-LIS enrollees could see changes including an out-of-pocket maximum that would lower out-of-pocket costs (OOPs) for those with high prescription drug costs. However, another change to how beneficiaries’ true-out-of-pocket costs are calculated could make it harder for enrollees to reach the catastrophic coverage level of their plan, which could land them with higher OOPs.
By slowing enrollees’ progression toward the catastrophic phase, "This would result in fewer beneficiaries ever reaching catastrophic coverage," Avalere concluded.
Congress is unlikely to act on the recommendations--if it does at all--until after the election, the analysts added.