CMS made the announcement and issued a memo detailing the changes on Tuesday afternoon.
There’s just one problem. Step therapy is a form of prior authorization and physicians really, really hate prior authorization, viewing it as disrupting the patient-physician relationship and creating an unnecessary burden.
The new option for plans would also create a “level playing field” between Part B and Part D drugs, enabling plans to negotiate better deals for patients, she added.
Part B drugs are typically more expensive and often include biologic agents. They are typically administered by physicians in their office, whereas Part D drugs are those picked up at a pharmacy and self-administered.
In the past, competition may have been stymied by having a Part B drug under one benefit and its competitor under a separate Part D plan, Verma explained.
Under this new approach CMS would allow plans to “cross-manage” these medications.
“So, if a plan is managing both the Part B benefit and the Part D benefit, they can essentially… require the lower cost drug to be used first,” she said.
The agency said Part B drug spending in Medicare Advantage plans totals about $12 billion annually. Another official on the press call said that, in the private sector, step therapy has cut drug spending by 15%-20%.
One group celebrated the planned change.
“We look forward to seeing more details of this plan and we will work with the Administration and other stakeholders to achieve a necessary balance between improved price negotiation and maintaining appropriate access to medications for Medicare beneficiaries.”
As expected, the medical community was more skeptical of CMS’s planned changes.
“Going through cancer treatment is hard enough – cancer patients should not be forced to ‘fail first’ on a drug that is known not to work for them before they are allowed to take the recommended treatment,” Hansen said in a press release.
He stressed the importance of having “a speedy and easily understood appeals process” and urged the agency to monitor the volume of these appeals and exemptions.
Katie Orrico, director of the Washington office for the American Association of Neurological Surgeons, told MedPage Today in an email that prior authorization requirements have increased in the last several years, leading to unnecessary delays and sometimes denials of medically necessary services.
“Ultimately, most of the prescribed services or tests are approved, leaving patients and physicians frustrated and baffled by this process,” she said.
A 2017 survey conducted by the American Medical Association found physician offices spent an average of 14.6 hours per week managing an average of 29 prior authorization requests. Nearly 8 out of 10 physician respondents said the process sometimes leads to “treatment abandonment.”
On Capitol Hill, Reps. Ami Bera, MD (D-Calif.), and Rep. Phil Roe, MD (R-Tenn.), drafted a letter to Verma requesting that CMS review the use of prior authorization under Medicare Advantage “to help increase transparency, streamline prior authorizations, and minimize impact on patients.”
They also asked that CMS “issue guidance to [Medicare Advantage] plans dissuading” prior authorization requirements that interfere with “an already-approved plan of care” or that apply to procedures and services that are rarely denied. Bera and Roe are requesting signatures from other members of Congress.
The changes CMS put forward do include “guard rails” for patients’ protection, Verma noted.
More than half of the savings that Medicare Advantage reaps through step therapy must be returned to the patient through patient rewards programs, usually in the form of gift cards, Verma said. Plans must also incorporate care coordination services and establish patient adherence strategies.
Also, under current Medical Loss Ratio requirements, plans must invest 85% of their revenues into healthcare services.
Insurers will be required to explicitly detail the change both in the annual notice of change documents and their evidence of coverage documents, as well as on the plan’s website.
Additionally, “if there is a concern… the patient and their physician can appeal that through the existing appeals process,” she explained on further questioning.
This new option as part of Medicare Advantage plans will be available during 2019 open enrollment period, which begins Oct. 15, 2018.
Anyone wishing to select a different plan will have that choice, Verma said, adding that CMS will extend the window during which beneficiaries may switch plans through March 2019.