CMS issues final drug rule

The Medicare drug regulation aims to improve formulary guidelines but makes no provision requiring network physician oversight of pharmacy and therapeutics committees.

By David Glendinning — Posted Feb. 14, 2005

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Washington -- Many doctors anticipate butting heads frequently with Medicare drug plans over what medications they will cover starting next year. But with the unveiling last month of the new benefit's final rule, physicians could find that this process goes a bit more smoothly than initially expected.

"The final Medicare rule on the prescription drug benefit addresses several concerns of the AMA," said American Medical Association President John C. Nelson, MD, MPH.

The Centers for Medicare & Medicaid Services' rule stresses the importance of allowing Medicare Part D beneficiaries and their doctors to challenge insurers when they believe drugs excluded from coverage are both vital to the patients' health and without adequate alternatives. CMS largely will allow plans to craft their own tiered drug formularies but will establish a system by which interested parties can ask for special coverage exceptions.

To improve this process, CMS has decided to shorten the time frame within which a plan must respond to a challenge. A doctor lodging a request to prescribe a noncovered or nonpreferred drug now will receive an answer within 72 hours, or within 24 hours if the doctor contends that the patient's condition warrants an expedited response.

Medicare officials say such tightened deadlines will ensure that seniors do not go without needed drugs while they wait for pharmaceutical benefit managers to make decisions. The proposed rule the agency issued in August 2004 would have given plans up to 14 days to respond to coverage challenges.

"There is too much risk for an enrollee's health if determinations are not made sooner than 14 days from the date the request is received, since an enrollee often will not be able to pay out of pocket for a prescribed medication and thus must forgo necessary therapy until a determination is made," CMS states in the final rule.

The agency also is trying to reduce the administrative burden on doctors who help their patients receive needed drug coverage. The physician's supporting statement, which is required to request an exception for coverage of a nonapproved or nonpreferred drug, now can be transmitted orally to the drug plan rather than in written form.

Nevertheless, federal officials rejected an assertion from the AMA that the coverage exceptions process under the Medicare drug benefit represents a significant increase in physician responsibilities that is not accompanied by a corresponding boost in reimbursement.

"We anticipate that physicians and other health care providers will assist enrollees with their Part D appeals to the same extent that they currently help beneficiaries with Part A, Part B, and Part C appeals," CMS states. "We do not pay physicians for their assistance with appeals under Part A, B, or C."

Medicare officials also appear to be taking steps aimed at ensuring that drug formularies are robust enough to avoid the need for coverage challenges in the first place. Physicians have expressed concerns that drug plans will have too much latitude to refuse coverage for some of the most vital types of drugs.

CMS drafted more language in the final rule that clarifies how the agency will approve formularies developed by drug plans.

Plans could face heightened federal scrutiny if they meet but do not exceed the minimum drug guidelines recommended by the U.S. Pharmacopeial Convention, which developed a model formulary guide at the government's behest.

"Although Part D plans will not be required to include every Part D drug on their formularies, we will ... require that plans include adequate access to the types of drugs most commonly needed by Part D enrollees, as recognized in national treatment guidelines, on plan formularies."

A CMS spokesman declined to identify which treatment guidelines the agency would consult when making its plan approval decisions. But USP submitted a separate document to Medicare officials in December 2004 that identifies more than 100 "formulary key drug types" that the group says should be covered as a subset of the official list of drug categories and classes. Medications such as COX-2 inhibitors, SSRIs and ACE inhibitors show up on the addendum.

Support from doctors

The physician community is supportive of CMS' commitment to ensuring adequate drug formularies, Dr. Nelson said. "[One] positive note is Medicare's decision to require that plans cover the majority of drugs in certain drug classes [i.e., anticonvulsants, immunosuppressants and antineoplastics]," he said. "Concerns remain, however, that there may be insufficient opportunities for physicians to effectively influence the formulary decisions made by their patients' drug plans."

Physician advocates had little luck in prompting changes to the expert panels that will help drug plans develop their benefit structures. Although the pharmacy and therapeutics committees advising plans must have a majority of members that are practicing doctors and/or pharmacists, the final rule contains no requirement that plans consult the physicians who will be affected most by the decisions.

The AMA had called for a system through which doctors participating in the plan's region would have the power to oversee and approve formularies as well as serve on the pharmacy and therapeutics committees.

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Tweaking Part D

Federal officials issued a final Medicare drug benefit rule with several new changes that have the potential to affect doctors and their patients. Here are some of the alterations:

  • The government will enroll any Medicare-Medicaid dual eligible beneficiaries in a drug plan by mid-December if they have not enrolled themselves. Such a move will ensure the protection of seniors when Medicaid stops covering dual eligibles next year.
  • More federal subsidies will be available to seniors with incomes below 150% of the poverty level.
  • Plans that propose onerous documentation requirements for physicians who prescribe drugs for off-label use can face rejection from Medicare regulators.
  • More stringent pharmacy access standards will apply to drug plans. Access to non-network pharmacies in emergency cases will be guaranteed.

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External links

Centers for Medicare & Medicaid Services on Medicare prescription drug benefit, including text of final regulations (link)

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