CMS Rule Pushes for Price Transparency
CMS published a final rule on May 16 requiring Medicare Part D and Advantage plans to provide electronic data access to prescription drug costs. The Medicare Advantage and Part D Drug Pricing Final Rule requires Part D plans to provide access to a “real-time benefit tool,” which would integrate into a provider’s EHR or e-prescribing system. The rule carries national implications for prescription drug price transparency, a core aim of the current administration’s blueprint for healthcare reform.
The tools must be able to inform providers when lower-cost alternative therapies are available under the patient’s prescription drug benefit. Prescription drug costs have been a major concern for both patients and providers, as the federal government struggles with overall healthcare prices skyrocketing across the nation.
Patients as Consumers
The American Patients First blueprint from May 2018 outlined 4 strategies for attempting to solve this problem. These strategies include boosting competition, enhancing negotiation, creating incentives for lower list prices, and bringing down out-of-pocket costs. Economizing the healthcare industry has kick-started a trend of treating patients as consumers, with price transparency acting as a natural first step.
CMS Administrator Seema Verma released in a written statement that she believes “By empowering patients with information on the cost of their prescription drugs, today’s rule will ensure that pharmaceutical companies have to compete on the basis of price.” Price transparency should allow patients and providers to make informed about treatments, eventually lowering overall costs across the board.
The rule allows physicians to negotiate prices for physician-administered medications, and it outlaws “pharmacy gag” clauses, which prohibit pharmacists from giving information to patients on lower-cost alternatives. These clauses allocate more economic agency to providers and pharmacists. Additionally, pharmaceutical companies will now be required to disclose the list price for prescription drugs in TV ads if the price is equal to or greater than a $35 per month’s supply or the usual course of therapy, supporting further transparency.
The immediate effect will be new, interoperable tools to fit into EHRs with the aim of better informing providers on the economic aspects of the treatments they prescribe. A flurry of development activity can be expected, as these tools are created and tested to ensure federal compliance before the deadline of January 1, 2021.