Medicare Proposes Two Specialty Tiers for Part D Plans to Boost Price Competition

The U.S. Centers for Medicare and Medicaid Services (CMS) has proposed two specialty tiers offered by Medicare Part D plans on their drug formularies beginning next year to give them a greater say in negotiating lower drug costs, reports Politico Pro . The agency admitted the second tier would likely only lead to "small savings," with broad adoption of a second specialty tier "unlikely." One tier would be a "preferred" tier that offers lower cost-sharing for enrollees, and the maximum allowed cost sharing for both tiers would be between 25 percent and 33 percent, depending on whether the plan has a deductible. Drugs that cost at least $670 a month must currently be placed on one tier, and two tier options should give health plans leverage to work with drugmakers to reduce costs if the company wants to price their product at a more accessible cost to beneficiaries than rivals. The Medicare Payment Advisory Commission noted that two specialty tiers with different cost-sharing might spur usage of lower-cost biosimilars. The proposed rule also directs Part D plans to deploy a tool that will provide beneficiaries with real-time information about drug prices based on their plan coverage and potential alternatives by Jan. 1, 2022.