Medicare Part D Daily Cost Savings Requirements for 2014

With the beginning of 2014 just around the corner, it is important to note, or be reminded of, the change in the Medicare Part D daily cost sharing requirements.

Beginning January 1, 2014, Part D sponsors must establish and apply a daily cost sharing rate whenever certain prescriptions (depending on the drug dispensed) are dispensed by a network pharmacy for less than a 30 days’ supply in accordance with 42 CFR § 423.153(b)(4)(i). An example of the benefit of this requirement is that it provides Part D enrollees, in consultation with their prescribers, the option of shorter days’ supplies of initial fills of new prescriptions without the disincentive of the enrollees having to pay a full month’s copayment or coinsurance. We provided this example as enrollees are expected to be most likely to inquire of their prescribers whether a fill of less than a month’s supply would be appropriate when first prescribed a chronic medication, particularly when faced with high cost sharing, such as when purchasing the drug in the deductible phase of the benefit or in the coverage gap. Prescribers are expected to be particularly supportive of this prescribing option when the prescription is for a drug that has significant side effects, is frequently poorly tolerated, and when less than a month’s supply of the prescription is clinically appropriate. Another example of the benefit of this requirement is that it also allows beneficiaries the ability to synchronize their
prescriptions in consultation with their pharmacists without having to pay a full month’s cost sharing when less than a month’s supply of medication(s) is dispensed during the synchronization process until all medications are on the same thirty or more days refill schedule. We intend to include language in future Medicare & You and Part D Evidence of Coverage (EOC) documents on the availability of daily cost sharing rates, and on when and how beneficiaries should consider taking advantage of them.

Also, we want to specifically note that the daily cost sharing requirement does not address how pharmacy-dispensing fees are to be negotiated, calculated or paid. However, we have heard that some sponsors are prorating dispensing fees as part of implementing the short cycle dispensing requirement in long-term care facilities in 2013 and may be incorrectly referencing the upcoming 141 daily cost sharing requirement as the reason. To be clear, there is no necessary connection between daily cost sharing amounts charged to beneficiaries and how dispensing fees are paid to pharmacies. Further, if the reports of prorating dispensing fees are accurate, we are disappointed that sponsors would reimburse dispensing fees in away that incentivizes wasteful dispensing of maximum amounts and at the same time financially penalizes the most efficient dispensing methodologies to reduce unnecessary waste and cost in the Part D program. Sources:

Here are some other resources available:
What Can I expect to Pay for Medicare in 2014?
http://www.freep.com/article/20131122/FEATURES08/311220004/medicare-decision-guide

CMS Part D 2014 Standard Benefit Model Plan Details
Shows a cost comparison from 2006 through 2014
http://www.q1medicare.com/PartD-The-2014-Medicare-Part-D-Outlook.php#MD65EA1AFB5EF4029B155E9B4E81C0FC5

1 http://www.cms.gov/Medicare/Health-Plans/MedicareAdvtgSpecRateStats/downloads/Announcement2014.pdf; Page 139

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