How a Trump Proposal Impacts Medicare Plan Coverage of Drugs

Under a Trump administration proposal, Medicare Part D plans would no longer be required to cover all human immunodeficiency virus (HIV) medications and other drugs in protected classes, The New York Times recently reported. The proposed change is an attempt to enhance negotiation between insurers and drug makers and, ultimately, reduce drug costs in Medicare.

According to the report, the George W. Bush administration instituted the coverage requirement more than a decade ago to provide Medicare beneficiaries access to “all or substantially all drugs” in six protected classes: antiretrovirals, antidepressants, antipsychotics, immunosuppressant drugs, epilepsy drugs, and many cancer drugs. The Obama administration later tried to relax some of the protections but was defeated in its attempt by patient advocacy groups that supported the drug coverage requirement.

Some are already speaking out against the latest attempts by the Trump administration, which would allow Medicare plans to exclude protected class drugs from their formularies in the event of sharp price increases or when new formulations are not significantly better than the original drug. Plans could also institute prior-approval and step-therapy policies to reduce drug costs, the article explained.

“The Trump administration proposal is bad medicine and dangerous to people living with HIV,” Carl E. Schmid II, the deputy executive director of the AIDS Institute, said in The New York Times article. “Not all HIV medications are the same. The Medicare Part D program is working well for people with HIV, and there is no reason to take these draconian actions.”

But Alex M. Azar II, the secretary of health and human services, reportedly defended the bid by pointing to negotiated private-market discounts of 20% to 30% for drugs in protected classes compared with an average 6% discount for Medicare Part D plans.

“Ultimately, the changes we are proposing would reduce costs for protected class medicines,” said Seema Verma, Centers for Medicare and Medicaid Services administrator, “and therefore expand access to these important medicines.”

—Jolynn Tumolo

Reference

Pear R. Trump moves to lower Medicare drug costs by relaxing some patient protections. The New York Times. November 26, 2018.

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