The CMS Draft Call Letter for 2016
The Call Letter:
Each year, in advance of the bid submission to CMS for the next plan year, CMS
issues a “Call Letter” that gives Medicare drug benefit plans (Parts C and D) the information they need to
prepare their bids. Such information includes the dollar value of the standard benefit, subsidy amounts,
technical information and minor policy changes the plans must implement in the next year.
On policy issues, the Call Letter generally covers minor modifications to existing policy and saves major
revisions for formal rulemaking. The proposed (or draft) Call Letter is generally issued in late February,
after which CMS accepts comments, and the letter is finalized in April, ahead of the early deadlines for
submissions by the plans.
This year’s draft Call Letter was released on February 20th, and CMS will accept comments through
March 6th. The Final Letter will be published in early April.
Here are the highlights the 2016 Proposed Call Letter:
Formulary Submissions:
This section focuses on the process CMS requires for plans to
submit formularies for the 2016 year. In addition, CMS provides information on how formularies may be
amended (e.g., new drug approvals, newly-approved generics, etc.). One of the problems CMS points
out is that plans are not always clear when they impose quantity limits on certain drugs. So, CMS has
proposed that when plans submit formularies, they indicate whether there is a quantity limit, and if so,
whether it’s a daily limit or a limit over time.
Exceptions and Appeals Processes:
CMS notices an “unacceptably high” rate of non-compliance
with policy on ensuring that providers and enrollees have sufficiently specific information on reasons for
denial, and what information is needed by the plan to approve coverage. CMS also notes that plans have
not generally kept adequate records on their attempts to reach out to enrollees and providers to obtain
information to make a coverage decision.
CMS reiterates that plans must provide accurate, specific and detailed reasons for the denial, as well as
a reference from Medicare coverage rules or plan policy citation.
If a plan requires clinical information, it must request this from the provider and document efforts to
reach out to the provider to obtain this information.
CMS encourages plans to improve their appeals and grievances process during 2015 in advance of Drug
Benefit Manual changes that will be issued in 2016.
CMS has a high level of focus in this area and will continue policy development. The agency requests
stakeholders to offer suggestions for improvement in this area.
Audit and Oversight: CMS begins the discussion by noting that it continues to find a lack of
improvement as it audits plan compliance with program requirements. Specifically, CMS finds that plans
are often inappropriately denying access to Medicare beneficiaries. CMS notes that it has authority to
pursue enforcement actions, including civil monetary penalties.
CMS also notes that it will be piloting new audit modules to test compliance with Medication Therapy
Management programs requirements and with provider network adequacy requirements.
Integrated Dual-Eligible Special Needs Plans (DSNPS): CMS discusses the option for Dual-Eligible
Special Needs plans to achieve seamless integration with Medicaid Managed Care Organizations. This
option is currently available and CMS provides information on how states and plans can proceed.
The Letter also lays out future efforts to integrate DSNPS and asks for stakeholder comment.
Improving Drug Utilization Review Controls in Medicare Part D:
CMS continues to
identify drug utilization review (DUR) as a successful way to monitor for potentially dangerous drug use.
It holds up efforts to monitor acetaminophen (APAP) and opioid drug use as examples of successful DUR
initiatives.
CMS expects plan P&T committees to approve standards for a soft point-of-sale edit based on daily
morphine equivalent dose (MED). When an enrollee meets or exceeds the target, there should be a soft
edit. CMS further requests feedback on its suggestion that 200mg MED for two or more prescribers
might be an appropriate measure. It also asks for rationale when plans submit their soft edit
requirements.
Medication Therapy Management (MTM):
CMS, having previously proposed reducing the
threshold for inclusion in an MTM program, has signaled that it will continue with the current formula. It
will provide an MTM guidance memo thirty days prior to the submission deadline for plans on their
MTM programs.
Access to Preferred Cost-Sharing Pharmacies: CMS noted that it had received complaints from
interested parties that plans were advertising low cost sharing, available through preferred pharmacies,
but that these pharmacies were not accessible to large segments of the enrollee population. CMS
commissioned a study, which appears to confirm that suspicion.
CMS plans to publish information on preferred pharmacy availability for plans that offer reduced-rate
cost sharing in order to improve transparency to enrollees. It will also work with plans with the most
disparity in preferred pharmacy availability and encourage them to add qualifying pharmacies or to not
market themselves as low-cost sharing plans.
Maximum Allowable Cost (MAC) Pricing: When updating MAC prices, the regulations will require Part
D sponsors to disclose the drug prices to the applicable pharmacies in advance of their use for
reimbursement, if the source for any prescription drug pricing standard is not publicly available. Part D
sponsors will have to convey to network pharmacies the actual MAC prices to be updated in advance.
CMS cautions Part D sponsors that updates of MAC prices must be disclosed to network pharmacies in a
manner that is usable by pharmacies because the manner of updating MAC prices must enable
pharmacies to validate prices.