Part D Protected Classes Suddenly Not So Protected
The latest push by the Centers for Medicare & Medicare Services to tamp down drug costs has targeted a previously untouchable area: Part D’s protected drug classes. The Trump administration is touting the new measures as another way to cut Medicare drug costs and to spur negotiations between pharma manufacturers and Medicare Advantage plans.
Part D carriers must cover all drugs in the six protected classes. It isn’t hard to see why, given the sensitive nature of those classes: immunosuppressants (transplant drugs), antidepressants, antipsychotics, anticonvulsants, antiretrovirals (HIV/AIDS), and antineoplastics (oncology).
There have been few attempts to tinker with the six protected classes.
CMS has added three exceptions to the protections. The proposed rule would:
- Expand utilization of prior authorization and step therapy in the protected classes (plans already employ PA and ST for such sensitive classes).
- Exclude any protected class drugs that are new formulations of single-source drugs or biologics from the Part D formulary.
- Exclude any protected class drug that has price increases that exceed inflation.
While the Part B rule change simply rescinded an Obama administration rule, changing the protected classes could be a harder sell. The conditions treated by protected classes have not been areas where CMS has been eager to meddle.
While the latter two changes might see little opposition, broader utilization restrictions will likely run into roadblocks. Beneficiaries on existing treatments generally won’t have to switch because of new utilization restrictions. Newly diagnosed patients or people aging into Part D would encounter prior authorization and step therapy.
As with the Part B changes instituted for Medicare Advantage in 2019 (and further codified in the same rule), biosimilars could be the drugs to benefit from new restrictions. Still, opportunities could be limited in classes like antiretrovirals, the expensive drugs that treat HIV in concert with other medications. As in Part B, any attempt to restrict antineoplastics, which treat cancerous tumors, would draw outcry, although biosmilars for drugs such as Herceptin could receive favorable formulary placement depending on the discounts they offer.
As with the changes instituted and considered by the Trump administration, advocates are ready to oppose and note that the estimated savings. The rule is only preliminary, and CMS almost always pulls back when it issues a final rule.
When this rule gets finalized in early 2019, it will likely look far different than in the initial version. But it is almost assured the Part D protected classes won’t be universally protected anymore.
Bill Melville is a principal analyst at DRG and national healthcare policy expert whose work appears in Health Plan Analysis and Market Overviews. Follow him @BillMelvilleDRG