Melissa Andel Gives Insights on Potential Changes to Part D Formularies | AMCP 2024

In this second part of a two-part video series, Melissa Andel, MPP, principal of CommonHealth Solutions LLC, expressed that observers believe that Part D plans might try to reduce their costs during the catastrophic phase of coverage by limiting the medications included in their formularies. But she said several factors may counteract that tendency.

CMS requires Part D plans to have “robust, nondiscriminatory formularies.”

Part D can’t limit their formularies too much because the Part D plans are competitive, Andel, who moderated a session today on IRA updates at the annual AMCP meeting, said.

“From the perspective of a plan that is trying to be competitive in the market, they also can't risk getting too narrow with their formularies, or they might not be able to attract beneficiaries,” she said.

Finally, any strategies to keep people out of catastrophic coverage is likely to have a limited effect because the high price of drugs means many beneficiaries will hit the $2,000 cap quickly. Moreover, the rules for how vaccine and insulin costs are counted toward that cap may change.

“I think it's going to be hard when you're only working with $2,000 — it's going to be much more difficult to keep beneficiaries out of that catastrophic coverage. There's only going to be so much that you can limit so much access, you can limit and still remain competitive,” Andel said.