Managed Care - December 2008 - (Page 23)

eral government instead of Part D plans. That could have a significant impact on plans’ ability to negotiate prices for the whole Part D population.” It would set up a scenario with one set of prices for dually eligible members and another set for everyone else. Choice However, there’s no shortage of proposals in Congress over the future direction of the program. “It could go in one of two directions,” Stefanacci says. “Either heavy regulations in all areas like formulary management and cost-sharing percentages. Or, it keeps the current system in play, with a free market approach and a Medicare Part D federal program.” A new federal drug plan, he says, would become the default program for low-income seniors and anyone else who wanted in at that price. If they wanted more from Part D, then they could go to one of the private plans. Getting some measure of control over drug prices is what the move to repeal the noninterference clause banning federal price negotiations is all about. People have already been talking about going to Canadian pharmacies or deep discounters like Wal-Mart, just as they did before Part D was implemented, says Precht. If Congress approves reimportation, as expected, that trend could take off. Reimporting drugs from Canada “started off as almost a stunt to demonstrate how much more we were paying in the United States than in Canada,” he adds, “and now it’s become a strategy. Instead of having the government negotiate a lower drug price, we’re relying on the Canadians to do it for us.” Some health plans may welcome the move. “I could see a plan that would allow drugs to be purchased online, with designated reimportation Web sites,” says Stefanacci. “They would count that as out-of-pocket expenditures for individuals. If you fall into the doughnut hole and can come out, it makes sense to use the lowest cost source and have it count toward the catastrophic coverage.” Misaligned incentives Congress may also decide to tinker with parts of the program that never worked as originally planned. One of Stefanacci’s prime examples is Medication therapy management. MTM is written into Part D regulations as a service those plans have to provide to targeted beneficiaries, with a definition of what services are offered and how they are delivered left to the plan, says Stefanacci. The way it was envisioned, MTM would ensure optimal medication management for patients. “The problem is that if you are a Part D plan only responsible for drugs, you’re only interested in eliminating unnecessary drug use or encouraging generics.” It isn’t necessarily in your financial interest to encourage the use of more expensive medications that can reduce hospitalizations if you don’t cover hospitalizations. “So as a result you get misaligned incentives,” says Stefanacci. CMS may well tackle that with new legislation. For example, plans now have to have a “qualified provider,” such as a nurse, handle MTM. This approach has given plans virtually complete control of the program, says Stefanacci. New legislation could require a third-party pharmacist to do the work, with less control by the plan and more focus on the medication, regardless of cost. One other potential change agent to consider: A new CMS administrator. This official will have wide-ranging powers over Part D. One example: Personally ordering a revision of the formulas used to decide which plans qualify to provide benefits to low-income beneficiaries. Cost-sharing rules and formulary designs could be affected as well. Says Washington: “There are a million unanswered questions.” Just one of those big questions revolves around what a federal government facing a trillion-dollarplus deficit can afford, balanced against the family budgets for seniors whose retirement savings have been blasted by the collapse of stock prices. Change is likely No matter what Congress and the new president decide to do, though, changes are likely to take some time to take effect. Next year’s terms are already set. The program is likely to hold on to a huge number of members. Even in 2010, says Washington, big changes are unlikely. Noninterference, MTM requirements, and reimportation could easily be part of the legislative agenda for 2009, says Stefanacci. MC DECEMBER 2008 / MANAGED CARE 23

Table of Contents Feed for the Digital Edition of Managed Care - December 2008

Managed Care - December 2008 Editor's Memo Contents Legislation & Regulation News and Commentary Medication Management Compensation Monitor ICD-10 Offers Huge Opportunity, Challenge Part D at a Crossroads Plans Can Weather the Financial Crisis DM vs. Medical Home? Tackle Prediabetes Reasonable Approach to Morning Sickness Formulary Files Tomorrow's Medicine Outlook

Managed Care - December 2008

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