By Maddie Mason, Associate, Policy
Many Medicare beneficiaries, including those enrolled in Part D plans, struggle to afford their medications due to high out-of-pocket (OOP) costs. To help combat this issue, the House Committees on Ways & Means and Energy & Commerce jointly released draft legislation on Medicare Part D reform on May 23, 2019. The National Health Council (NHC) is committed to ensuring that patients have access to affordable, high-value medicines, and therefore appreciate the Committees’ efforts to help reduce the financial burden they impose upon the patient community.
Since the launch of Part D plans in 2006, many factors have shifted in the policy and drug landscapes, allowing for the innovation of life-saving and expensive medications and therapies that help manage or cure chronic diseases in recent years. However, due to a lack of policy advancement, Medicare beneficiaries are forced to pay very high OOP costs for their medicine. Under current law, there is not a cap on Part D OOP costs for those not eligible for the Low-Income Subsidy (LIS) Program. The NHC has long supported a cap on OOP costs in Medicare Part D, and we are very pleased this issue is gaining attention. The NHC offered the following suggestions to strengthen the legislation:
Distribute beneficiary cost-sharing throughout the year.
The NHC believes that enforcing an OOP cap in Part D will help make drugs more affordable for the Medicare population, but we believe the proposed cap needs to be restructured slightly. The NHC encourages the Committees to consider options that would allow OOP costs to be distributed more evenly throughout the calendar year, and not base it on the current catastrophic limit. Additionally, we ask the committee to work with stakeholders, including patient advocates, to help the Committees align on a mechanism that would best benefit patients.
Protect Beneficiaries from unintended consequences through oversight and transparency.
While the NHC is supportive of modifications to the benefit structure to include an OOP maximum and other changes being pursued by the Committees, we believe this could upend incentives, and thus will require another level of oversight to ensure patients are protected. The NHC asks the Committee to add language that requires CMS to reinforce proper oversight and enforcement protocols over plan formularies and utilization management tools and improve information transparency on Plan Finder to ensure patients are aware of adjustments to their benefit. This will help empower patients to choose the most appropriate plan for their needs.
Consider additional solutions to make OOP costs more affordable for non-subsidized beneficiaries.
Many non-LIS beneficiaries whose incomes and assets are slightly above the LIS eligibility pay a significantly higher percentage of their total income towards OOP costs, relative to a beneficiary with a higher income. Beneficiaries with high drug needs, who are slightly above the LIS threshold, are unequivocally burdened by high OOP costs. To help mollify this issue, The NHC asks the Committees to consider options to implement an OOP cap that offers Medicare beneficiaries whose incomes and/or assets do not allow them to qualify for full subsidies. This can be achieved, either by raising the threshold for LIS eligibility, offering a lower OOP cap for those just above the threshold, or a combination of both.
We are heartened to see significant interest from Congress and the Trump administration, who have expressed commitment to reducing OOP costs for Medicare beneficiaries. We fully understand the complexities involved in designing the cap to equitably spread these costs throughout the entire Medicare population, which will likely involve premium increases across-the-board. Much of the discussion will involve what financial responsibility insurers, drug companies, and taxpayers will bear for this important patient protection. We stand willing and able to work with Congress as it crafts legislation on this topic.
Please read our comment letter, which offers more details on the NHC’s suggestions on the Medicare Part D reform legislation.