Commercial Insurers Also Drag Feet on Covering Generics

February 20, 2020

Trade group had previously documented even slower coverage by Part D plans.

Commercial insurers, not just Medicare D plans, are slow in covering new generics, according to a white paper released today by the Association for Accessible Medicines, the trade association for the generics and biosimilars industry.

Still, by the association’s reckoning, commercial insurers are doing better job of covering generics than Part D plans.

Today’s white paper is a follow-up to a

white paper

the association put out in September that showed that it takes nearly three years before first generics are covered on a little more than 50% of Medicare Part D formularies. The association says rebates and the mandatory discounts on branded drugs in Part D wind up disadvantaging generics, and it has called for rules that would ensure the Part D plans cover generics when they launch and that generics would be listed on generic tier. 

Related: Generics of Older Drugs Could Have Saved Medicare Billions, Study Says

Today’s white paper says commercial health plans also drag their feet in covering generics, although not as much as Part D plans do. When the association’s researchers analyzed 600 commercial formularies, they found that about 75% of them were covering new generics three years after they were launched-but, they noted, that coverage plateaus after two years. "Policymakers should examine whether this data signals a worsening coverage trend," says the white paper. 

The association research found that 90% of the time commercial insurer put generics on lower-cost generic tiers in their formularies-the placement that the association wants-and that placement on that tier inches up over the next several years.

In contrast-the according to the association’s research-Part D plans put first generics on the generic tier about 50% of the time and then tend to move first generics to higher tiers in subsequent years.