Medicare’s Six Protected Classes Policy Ensures Patient Access to Medications While Simultaneously Driving High Rates of Generic Utilization
Avalere Study Shows: Part D Plans Use Controls to Keep Costs Low
Washington D.C. — The Partnership for Part D Access released a new analysis today (two-page summary) which finds Medicare’s existing protected classes policy is working as intended for Medicare beneficiaries with some of the most complex health conditions: cancer, HIV, transplant recipients, epilepsy, and mental illness among others. Specifically, the findings clearly demonstrate that Medicare drug plans are aggressively employing utilization management and other tools across the six protected classes — meaning patients are directed to use lower-costing medications whenever appropriate.
“This new study provides overwhelming evidence that Medicare’s protected classes policy strikes an appropriate balance between allowing plans to utilize medication management techniques and preserving a safety net for patients who absolutely need a particular medication,” said Chuck Ingoglia, Senior Vice President, Public Policy and Practice Improvement at the National Council for Behavioral Health, who serves as Executive Director for the Partnership. “Even with these protections in place, patients must overcome layers of restrictive barriers that plans put in place to access needed medications.”
Earlier this week, the Trump administration released a proposed rule including drug pricing policies intended to lower the price of prescription medications for patients and taxpayers. Among the provisions, the proposal asserts that Medicare drug plans need new flexibilities to add restrictions or otherwise limit patient access to prescription medications in the six protected classes.
“This study soundly refutes claims that protected classes are driving up costs in the Medicare program because it allows unfettered access to the most expensive medications,” said Ingoglia. “In fact, this research shows that plans are aggressively utilizing tier placement and other management tools to drive an overwhelming percent of seniors towards lower cost medications.”
The analysis finds while only 35% of the covered medications in the protected classes are generic, 91% of the prescriptions filled were for generic medications. The data also definitively demonstrate that Medicare Part D plans use tier placement as the first line of medication management to encourage patients to fill lower cost generic medications. Nearly three-quarters of all drugs in the six protected classes are placed in a non-preferred or specialty category, with branded products categorized as non-preferred or specialty 78% of the time and generics subject to placement on the higher tiers 66% of the time.
The analysis, which was prepared by Avalere Health and sponsored by the Partnership for Part D Access, examines the tools Medicare Part D plans are currently employing to manage utilization of drugs under Medicare’s six protected classes policy. The study also analyzes variation between brand and generic utilization.
Specifically, the analysis found:
In addition to tier placement, plans frequently use at least one other utilization management approach to control patient access to drugs across all protected classes. A clear majority of beneficiaries are enrolled in Part D plans where protected classes medications are subject to coinsurance. Plans are particularly consistent in applying a coinsurance for brand medications across the protected classes, which presents another hurdle for patients seeking higher cost medications.
Proposals to restrict access to particular medications, especially for the most vulnerable Medicare patients, will by definition make it harder for Medicare patients to obtain the medications that work best for them. Restricted access could have a detrimental effect on the health and wellbeing of patients and could result in higher health care cost for patients and the Medicare program.
Patient Community Response
“The Avalere report commissioned by the Partnership for Part D Access demonstrates that rather than driving the inappropriate use of costly drugs, nearly all of the antidepressants (97%) and antipsychotics (91%) prescribed were for generics,” said Andrew Sperling, Director of Federal Legislative Advocacy at the National Alliance on Mental Illness. “This is a remarkably high rate of generic utilization — way higher than for the general pharmaceutical market — and CMS should be absolutely thrilled with how the policy is working to keep down costs.”
“What this report tells us is that, due to the six protected classes policy, people living with HIV largely have access to the drugs they need. At the same time, plans have tools at their disposal and are utilizing aggressive use of non-preferred and specialty tier placement, along with costly coinsurance, for HIV drugs and all the classes,” stated Carl Schmid, Deputy Executive Director of The AIDS Institute.
“Even though federal law requires that Part D plans provide access to all drugs in the six protected classes, this study revealed that in fact, Medicare beneficiaries enjoy access to only 57% of all immunosuppressant drugs, and of these, only 49% of branded drugs,” noted Dr. Matthew Cooper, the Director of Kidney and Pancreas Transplantation at Medstar Georgetown Transplant Institute and a Board Member of the National Kidney Foundation. “While we have long suspected that plans weren’t actually providing access to every medication they are supposed to under the law, we were stunned to see how many of these potentially life-saving drugs aren’t being covered at all. CMS should look at this closely.”
“With all the renewed attention on the Part D protected classes policy, it is important that we debunk the notion that plans are powerless to drive patients to lower priced, generic drugs,” observed Laura Weidner, Vice President of Government Relations and Advocacy for the Epilepsy Foundation. “The Partnership for Part D Access Avalere study reveals that only 15% of all anticonvulsants — and 10% of all branded drugs — are listed on preferred tiers that offer the lowest cost sharing and fewest administrative hurdles for patients. These barriers impede access to the appropriate treatment —which for people with epilepsy can result in increased or breakthrough seizures, injury, accidents, additional medical and hospitalization costs, and even unexpected death.”
“92% of branded drugs carry a significant coinsurance for which cancer patients, on average, must pay $2,428 per month." stated Elizabeth Franklin, Executive Director of the Cancer Policy Institute at the Cancer Support Community. “This is a price point that is unmanageable for many and may limit access to the medications most needed by patients at this critical point in time.”