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AMA Expresses Concern with Medicare Part D Formulary Changes

New Medicare Part D formulary rules may create patient safety risks and increase the administrative burdens of prior authorizations, the AMA says.

AMA says new Medicare Part D rules could add patient safety risks.

Source: Thinkstock

By Thomas Beaton

- New Medicare Part D formulary policies introduced by CMS in August may increase patient safety risks and complicate the prior authorization process, said AMA President Barbara L. McAneny, MD, to HealthPayerIntelligence.com.

In an emailed statement, McAneny contended that newly introduced guidelines to allow Part D plans to use indication-based formularies would likely reduce patient access to effective therapies and may create unanticipated patient safety risks.  

“Rather than benefiting patients, the CMS proposal actually introduces unfair complexity to Medicare patients and further cements the role that insurance companies play in deciding treatment plans,” said McAneny. “This is not a recipe for good health.”

The AMA also believes that the Part D changes will create confusion among patients, especially those without high health literacy and experience with navigating complex regulations around prescription drugs.

“Under the plan, Medicare patients will face increased challenges as they navigate health plans to make sure that their needed drug is on their selected formulary, which can change based on what health conditions they have,” McAneny continued.

“While the CMS notice included a statement that plans had to include information addressing indication-based formularies in materials provided to prospective enrollees, that is not much help to patients who are not sophisticated in how formularies work. Furthermore, Medicare patients with several chronic diseases are unlikely to find a formulary that covers all their needs.”

AMA also said that the Part D policies don’t provide enough transparency about formulary decision-making or administrative burdens for providers.

“Physicians already lack ready access to accurate formulary information – preferred/tier status, on/off formulary, prior authorization and step therapy requirements – at the point of care in their EHRs. These transparency problems will expand by an order of magnitude by the complications this change introduces,” McAneny said.

McAneny’s statement aligns with the AMA’s general stance on prior authorization and the burdens it may impose on both providers and patients.  The organization has asserted that prior authorization contributes to the vast majority of delays in care and may prevent medication adherence.  

CMS believes, however, that the formulary changes will give payers more power to negotiate drug prices and reduce the soaring costs of prescription medications for patients.

“This action delivers on President Trump’s drug pricing blueprint by offering Medicare plans new tools to negotiate lower drug prices and offer patients better choices,” said HHS Secretary Alex Azar in a memo to health plans.

“This is a significant step in modernizing the successful Medicare Part D program by giving plans the tools that serve patients well in the private sector.”

Health plans will be able to adopt indication-based formulary design in 2020, CMS said.

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