Today, the Centers for Medicare & Medicaid Services (CMS) released guidance and a Fact Sheet that will provide Medicare Advantage (MA) plans the option of utilizing “step therapy” for Medicare Part B drugs. Recall, the concept of changing the way Medicare pays for Part B drugs was first discussed in the Administration’s May 2018 Blueprint.The guidance released today in the form of a memorandum to MA plans, rescinds current guidance that precluded the use of step therapy for Part B drugs and gives MA plans the choice, beginning January 1, 2019, of using step therapy to manage these drugs. Step therapy is a form of prior authorization used by MA plans to control costs by requiring in some instances that a patient try an inexpensive drug before “stepping up” to those which are more expensive.

While the guidance raises many implementation questions, there are a few of items worth noting. According to the Fact Sheet, “MA plans participating in Part B step therapy must disclose that Part B drugs may be subject to step therapy requirements in the plan’s Annual Notice of Change (ANOC) and Evidence of Coverage (EOC) documents that are provided to enrollees prior to the Medicare Open Enrollment period to assist them in making plan selections for the upcoming year.” In addition, “[c]are coordination must include discussing medication options with beneficiaries, providing beneficiaries with educational material and information about their medications, and implementing adherence strategies for beneficiaries on their medication regimen.” Finally, while the guidance stresses the importance of “patient engagement” and rewards as part of care coordination, MA plans are reminded “plan rewards cannot be offered in the form of cash or monetary rebate, but may be offered as gift cards or other items of value to all eligible enrollees.”

There will undoubtedly be more to come on this issue. We will be watching it closely and will update this post as needed.