Pharmacy & Therapeutics - March 2008 - (Page 147) Failures of Medicare Part D Delivery all Part D pharmacy operations—whether PBMs and their pharmacy providers, chain drugstores, or community pharmacies—was never adopted by CMS. Instead, the Bush administration and Congress allowed each pharmacy provider accepted into the Medicare Part D program to establish its own P&T committee and to create its own formulary. These pharmacy providers were not required to reveal either the identities or qualifications of persons serving on their P&T committees or the criteria used to select dr ugs for formularies. More impor tant, the pharmacy provider’s formulary drug list was not adequately disclosed.10 This near-total nondisclosure of formularies has denied prescribers, patients, and pharmacists adequate knowledge of the drug-selection process. In California, for example, there are at least 47 pharmacy providers under Part D. Each provider has its own P&T committee and its own formulary. Regulatory oversight for all of these providers is delegated to only one CMS pharmacy consultant. As implemented in 2006, Part D prescription drug programs must employ private insurers to administer drug coverage to Medicare beneficiaries. Proponents of this approach claim that private prescription drug coverage provides broader drug selection at a lower cost. Opponents question how private organizations can be more efficient than such governmental organizations as the VA. As previously noted, Part D costs are almost 58% higher than similar outpatient drug costs under the VA system.2 To attempt resolve these different points of view on private versus governmental administration of prescription drug coverage, Henry Waxman, Chairman of the House Committee on Oversight and Government Reform, authorized a study to analyze costs from the private insurers operating Medicare Part D.2 The final report included data from 12 leading insurers offering Part D coverage to more than 18 million Medicare beneficiaries. This figure represents almost 75% of enrollees in Part D. The committee findings indicated that the use of private insurers to deliver Medicare Part D drug coverage was driving up costs and producing only limited savings on drug prices.11 Taxpayers and Part D beneficiaries might have been able to save almost $15 billion in 2007 alone if administrative expenses had been reduced to levels achieved by traditional Medicare programs and if drug prices had been lowered to Medicaid levels.2 We are not aware of any large or persuasive studies demonstrating that PBMs can either reduce drug costs or improve the quality of pharmaceutical care. Prescribers, pharmacists, and Part D beneficiaries do recognize that private firms such as PBMs and insurers must be profitable in order to survive, but the drive for higher profits should not eclipse the business practices that earn a company respect for its products and the fairness of its dealings with consumers. Private firms list many reasons why they cannot change their business practices, including the cost of developing and marketing new drugs, fierce competition from other drug manufacturers, and positions by the VA as well as other countries, such as Canada, that deny formulary access to manufacturers that refuse to lower prices. As the P&T editorial in 2005 suggested, patient access to medications will face even greater restrictions if health insurance plans and their PBMs continue to write the rules of prescription drug access.1 PBMs claim that on-line access to the many PBM formularies is straightforward and simple. This has not been our experience, or the experience of CMS staff we have consulted,10 or the experience of patients. The insurance plans and their PBMs need to recognize that they must supply the most efficacious drugs, not the least expensive drugs, to their patients and subscribers as a precondition to earning a reasonable profit. Formulary selection must be based, first and foremost, upon efficacy, safety, side-effect profiles, potential interactions, and similar clinical factors. Only if all clinical factors are equal should cost be considered in the formulary decision. RECOMMENDATIONS The following are our recommendations to improve access to prescription drugs under Medicare Part D: 1. PBMs must disclose full details about the methods they use to select prescription drugs for their formularies. The qualifications of those individuals chosen to serve on P&T committees and their formulary deliberations should be accessible to Congress, to CMS, to all health care professionals, and—most of important of all—to patients. PBM operations would become more transparent if CMS were allowed to do what it was mandated to do by the MMA and actively manage the Part D prescription drug benefit. 2. When P&T committee members add a drug to the formulary or delete a drug from the formulary, they must act only after they have carefully evaluated safety, efficacy, adverse effects, drug interactions, and other medically relevant data. Drug costs, rebates from drug manufacturers, and similar economic factors must be secondary to medical and therapeutic considerations. 3. Because cost is a relevant consideration in formulary design, multisource agents should be selected when available. If two drugs appear to be equivalent in therapeutic value, cost must be considered in deciding which agent to add to the formulary. This step can be accomplished only if CMS, operating with Congressional support, requires PBMs to fully disclose their financial relationships with drug manufacturers. A recent bill that failed in the Senate would have required that the federal government negotiate prices that Medicare pays for prescription drugs. There was some suggestion of change in the latter half of 2007 as more than a dozen PBMs agreed to reveal more about what they pay for drugs.12,13 4. Patients should have the option of obtaining a 90-day fill for their prescriptions at a local pharmacy without the financial penalties of multiple copays and multiple pharmacy visits even if a 90-day fill is available via mail order or via any other pharmacy channel. Community pharmacies typically provide timely, error-free service and sound pharmacological advice. In addition, patients have an informed, professional advocate in a local pharmacist who knows them and their personal health needs. This relationship can build the patient’s trust in the professional who dispenses prescriptions written by the physician, reinforcing confidence that prescription drugs are dispensed and used as intended and at a fair price. continued on page 181 Vol. 33 No. 3 • March 2008 • P&T® 147
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