CMS to test performance-based Medicare Part D program, targets rising drug prices

The Centers for Medicare and Medicaid's new Part D pilot for medication therapy management will offer performance payments to plans that achieve reductions in fee-for-service expenditures and fulfill quality and other data reporting requirements, according to information released by CMS on Wednesday.

Insurance plans that demonstrate reductions in Medicare Part A and B costs of care for their members by a minimum of 2 percent will receive a fixed $2 per member per month increase in the subsidy to the plan premium, which will decrease the beneficiary's portion of the premium, CMS said.

Payment for year 1 will be made in year 3 of the model.

[Also: CMS spent $103 billion on Medicare Part D in 2013, $2.5 billion on Nexium]

"In order to quality for performance payment, you will need to design programs for significant savings," said Nicholas Minter of the Department of Health and Human Services.

The medication therapy management model is being tested in five regions as an incentive to boost adherence for stand-alone Part D plans not connected with Medicare Advantage.

CMS is launching the five-year experimental model as drug prices have surged and Part D plan premiums are projected to increase.

The program is aimed at reducing medication related issues in patients as current medication therapy management has not produced the expected results, according to Minter.

The question CMS is trying to answer is, he said: Does providing regulatory flexibility and financial incentives to stand alone Part D plans encourage more effective medication therapy management programs?

The Part D Enhanced Medication Therapy Management model will give selected Medicare Prescription Drug Plans flexibility to design programs to improve health and lower costs.

[Also: CMS rolls out new value-based Medicare Advantage program]

A primary goal is to promote stronger links between prescription drug plans, pharmacists and prescribers, to identify enrollees whose medication use could cause adverse outcomes or significant non-drug program costs, according to CMS.

As with the new value-based Medicare Advantage model, the new drug plan will begin January 1, 2017 for five years. The five test regions are: Virginia; Florida; Louisiana; one region that includes Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota and Wyoming; and Arizona.

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Stand-alone prescription drug programs in these regions can apply to vary the intensity and types of medication therapy management interventions they offer. Beneficiaries will be contacted by their drug plans, pharmacists, or prescribers and offered assistance on their medication use.

CMS is waiving certain program requirements and is increasing access to Medicare Parts A and B data.

The new model does not directly pay pharmacists.

Applications are due in January 2016. Plans may apply to join in subsequent years.

Twitter: @SusanJMorse