Medicare Part D Plans Range in Drug Coverage and Cost

Medicare Part D drug plans vary widely in terms of coverage, tier placement, and cost-sharing for top brand-name and specialty drugs, according to the findings of an analysis by the Henry J. Kaiser Family Foundation. The report examines the coverage of top brand-name and specialty drugs using data from all national and near-national stand-alone prescription drug plans (PDPs) that were offered in 2010 by Part D sponsors. During the analysis, the authors identified the top brand-name drugs by using prescriptions filled by Medicare Part D beneficiaries in 2006, and then ranked the top 10 drugs that were most common and lacked generic equivalents in 2010. Using this method, they identified Lipitor, Plavix, and Nexium as the top 3 drugs, followed by Lexapro, Diovan, Aricept, Seroquel, Actonel, Advair Diskus, and Vytorin. Using the Medicare Prescription Drug Plan Finder, they found that the median monthly price in 2010 for the drugs was ≤$200. The top 10 specialty drugs were the highest total spending drugs in 2006 that had ever been placed on a specialty tier. The list included 3 drugs for HIV, 2 for rheumatoid arthritis, 2 for cancer, 1 for multiple sclerosis, 1 for pulmonary arterial hypertension, and 1 used to treat anemia in kidney failure, HIV, or cancer patients. To be listed on the specialty tier, all of the drugs had to have a monthly cost of ≥$600, but the authors of the analysis found that half of the top 10 drugs had a median monthly price of >$2400. Once the top brand-name and specialty drugs were identified, the authors examined differences in coverage. They found that 3 of the top 10 brand-name drugs (Aricept, Plavix, and Seroquel) are listed on the formulary of all the national PDPs in 2010, while Vytorin and Actonel appear on the smallest number of national plans. The remaining top 10 drugs are listed as a preferred drug on more than two thirds of the national plans. In addition, 9 of the top 10 specialty drugs are listed on all national plans, in part, because many specialty drugs do not have close medication substitutes. In terms of cost-sharing, there was wide variation between the plans, and the authors reported that, depending on the plan, there was at least a 2-fold difference between the lowest and highest amount a beneficiary could pay for a top brand-name drug. For specialty drugs, most plans charge 25% to 33% cost-sharing for drugs listed on the specialty tier and 5 of the top 10 specialty drugs are never placed on a tier with <25%cost-sharing. Due to the expensive nature of specialty drugs, beneficiaries who use them are more likely to reach the coverage gap earlier in the year, and for 3 of the top 10 specialty drugs, the coverage gap could be reached after filling just 1 prescription. There are several types of coverage restrictions used in PDP plans to help manage drug usage, including quantity limits, step therapy, and prior authorization. Quantity limits are used about 75% of the time for top brand-name drugs when they are covered in a plan; these limits are less common for specialty drugs. Prior authorization—the stipulation that a doctor must obtain authorization before the drug is covered—is more common for top specialty drugs and is required for 4 of the top specialty drugs in 95% of national plans, but the technique is not used often for top brand-name drugs. Step therapy is another option, but it is used less often than quantity limits for both brand-name and specialty drugs.