Fight looms over Medicare drug coverage

Physician groups worry that too few medication classes will be included in drug plan formularies, thus harming patients' access to pharmaceuticals.

By Brian Vastag, amednews correspondent — Posted Sept. 20, 2004

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Washington -- Although Medicare's prescription drug benefit does not launch until January 2006, health plan managers, physician groups, patient advocates and the drug industry are already jockeying to have a say in one big decision: Which drugs will the plan pay for?

In late August, the U.S. Pharmacopeial Convention unveiled draft formulary guidelines that met with howls from nearly every vested group. Doctors, patient advocates and drugmakers fear that resulting formularies will exclude vital medications.

Health plans and pharmacy benefit managers, on the other hand, complain that the guidelines contain too many classes. Fewer categories would increase their negotiating leverage when purchasing drugs and result in lower prices for Medicare beneficiaries, they say.

The opposing camps voiced their concerns at an Aug. 27 meeting in Baltimore.

The proposed model has "serious deficiencies," testified Joe Cranston, PhD, a pharmacologist and director of science, research and technology for the American Medical Association.

Representatives from various physician and patients' groups pointed out particular types of drugs that might be excluded from coverage if the draft guidelines were adopted as is. Their "critical" list includes statins for high cholesterol, selective serotonin reuptake inhibitors for depression, angiotensin receptor blockers for hypertension, proton pump inhibitors for gastro-reflex disease, bisphosphonates for osteoporosis, COX-2 inhibitors for arthritis and nonsedating antihistamines.

Drugmakers were equally critical. "The USP draft's gaps in access are dramatic and pervasive, affecting nearly every medical condition suffered by seniors and disabled persons," said Richard Smith, senior vice president for policy, research and strategic planning at the Pharmaceutical Research and Manufacturers of America. "In light of these remarkable gaps, a prescription drug plan's formulary could fully comply with the USP draft model while omitting numerous types of medicines that patients need and use and that physicians prescribe."

On the other side of the fence, Mark Merrit, president of the Pharmaceutical Care Management Assn., which represents pharmaceutical benefit managers, said the USP draft, with its 146 drug classes, "could have the unintended consequence of increasing costs and jeopardizing a workable Medicare prescription drug benefit for seniors." He called for the final model to have substantially fewer drug classes.

USP representatives were quick to say that the draft formulary guidelines are a work in progress and that they would take all comments into account when revising the model. They also reminded meeting attendees that their model would serve only as a guide and that the pharmacy benefit managers for each Medicare drug plan would make their own decisions on which drugs to include.

"Our model is merely a starting point for [prescription drug plans] to structure their own formularies," said William Zeruld, USP's vice president for business development.

But Dr. Cranston, among others, pointed to a large loophole.

The Medicare law provides drug plans with a "safe harbor" if their formularies adhere to the final model adopted by the Centers for Medicaid & Medicare Services sometime next year.

When Congress passed the Medicare Prescription Drug, Improvement and Modernization Act last fall, lawmakers called on USP to develop a model formulary because of the group's century-long history as a neutral party in the drug price wars. USP responded by pulling together a 17-member expert committee to assess existing formularies.

That committee also polled 31 specialty-oriented panels for proposed classes and subclasses. Beginning this spring, USP solicited input from drug plans, drugmakers, physicians and patient advocates.

After surveying existing formularies, USP's committee decided to base its model on the International Classification of Diseases, 9th revision. Roger Williams, MD, chair of the committee, said the group had chosen ICD-9 because of its wide acceptance as a taxonomy of diseases. The panel considered ICD-9's 17 classes of diseases, along with its 113 subclasses and 999 sub-subclasses when drafting the model, finally arriving at 146 drug classes.

But because the committee based its model on a disease classification system, rather than by the mechanism of drug action, physicians worry that several critical drugs will be rejected by Medicare.

"Where it really gets tricky is those classes where all the drugs are different," Dr. Cranston said. He noted that psychiatrists and neurologists, in particular, frown on the draft.

"With atypical antipsychotics, there are five or six, and they're all different. The four most common drugs to treat epilepsy are all different, and so on," he said.

In response, USP representatives pointed to a provision in the Medicare law that would allow physicians to petition on patients' behalf for coverage of drugs that fall outside formularies.

Dr. Cranston said the AMA was still evaluating the draft and would submit more substantive comments to USP. The USP plans to send its final model to CMS in December. Sometime next year, CMS will finalize its rules for Medicare drug plans with the USP model serving as a guide.

In the meantime, Dr. Cranston said, physician activists will continue working to ensure that "there won't be some burdensome system where doctors have to jump through every kind of hoop to get drugs for patients."

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External links

U.S. Pharmacopeia's model guidelines for Medicare prescription drugs (link)

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