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CMS Readies for Medicare Part D Formulary Review

WASHINGTON, D.C., 15 March 2005 — In less than two weeks, the Centers for Medicare and Medicaid Services (CMS) will begin accepting proposed formularies from prescription drug plans that hope to administer the Medicare Part D drug benefit next year.

CMS will accept formulary submissions from March 28 to April 18, after which the agency has set itself an ambitious goal for completing its review of the formularies.

"We are going to review those formularies in about four weeks," CMS pharmacist Babette Edgar said yesterday at a policy workshop held at the Kaiser Family Foundation's Washington, D.C., office.

Edgar, the director of finance and operations for CMS's Medicare Drug Benefit Group, explained that CMS is relying on its computer system to handle 75 to 80 percent of the formulary-checking process.

The remainder of the review will be conducted by clinical pharmacists, she said.

"Our system," Edgar explained, "will kick out where there are problems within the formularies, and at that point in time, there will be a clinical pharmacist that will review those particular outliers."

She noted CMS has "between 140 and 145 clinical pharmacists" either on staff or available through a contractor to help meet the May 16 formulary-review deadline.

Edgar said that the review will include 14 separate checks that the formularies are not discriminatory toward any group of Medicare beneficiaries and that the plans "provide appropriate access to consumers for all disease states for which there are medications."

CMS issued a guidance document for prescription drug plans in January outlining what the agency will require of plans that use a formulary. Among the requirements is the inclusion of two drugs in each therapeutic category and pharmacologic class described in the United States Pharmacopeia (USP) Medicare Prescription Drug Benefit Model Guidelines or an acceptable alternative. Also required is at least one product representing each of 119 so-called key drug types defined by USP.

In addition, CMS has singled out six drug categories—antidepressants, antipsychotics, anticonvulsants, antineoplastics, immunosuppressants, and HIV/AIDS drugs—for which the agency expects drug-plan sponsors to include in their formularies a majority or substantially all available products, Edgar said.

She added that if a drug-plan sponsor does not include "all or substantially all of these products, we are going to be asking them for clinical justification on why they do not."

CMS's review of the formularies will go beyond examining the list of drugs and includes an assessment of whether drug-utilization-management strategies will inappropriately restrict patients' access to therapy.

Among other things, Edgar said, "we are looking at checks on prior authorization, on quantity limits, on step therapy to make sure that plans are not prohibiting access inappropriately."

"There can't be a significant amount of issues or hoops to jump through that would prohibit patients getting these medications in a timely manner," she explained.

The first major deadline for potential Part D plan sponsors was Feb. 18, when letters of intent to participate in Part D were due at CMS. Completed applications are due to CMS by March 23, and Edgar said the agency will have a better idea then about how the formulary-review process will play out.

"We are still analyzing how many formularies that we're actually going to be reviewing," she said. "Our intentions are to have all of the initial reviews done within a two-week period, and the negotiations with the plans and with the [pharmacy benefit managers] will ensue after that two-week period."

Edgar said CMS is "anticipating that the formularies that come through will have some issues, but...that the reviews will go very smoothly."

Source: American Society of Health-System Pharmacists

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