Every year, I wage a battle against my heart disease. It’s not a battle that I should have to wage because it has nothing to do with my heart or with my medical care. It’s a fight with my Medicare prescription drug plan.
I require a brand-name version of a heart medicine because the generic version prompts unexpected, frightening side effects. My doctor understands this. My health plan – and the pharmacy benefit manager (PBM) that works with it – does not. So, each year, I go to war to fight for my health. One year, I had to take my plea all the way to an administrative law judge to get coverage.
It’s a terrifying experience, but it’s one that millions of patients may soon experience when the just-announced negotiated prices on ten highly utilized drugs in Medicare go into effect.
Each drug will carry a new list price in Medicare – known as the “maximum fair price” (MFP) – that is substantially lower than the existing list price. That sounds like it should be good news, but because of the misaligned incentives in U.S. health care, it represents a threat to PBMs and health plans.
PBMs don’t like low prices. They like high prices that they can then negotiate down, securing enormous rebates. Those rebates provide financial flexibility to health plans, a way to steer resources away from sick patients and toward other priorities.
These MFPs create a dilemma. They’re a good deal for the government. They might be better for patients. But they’re worse for health plans and PBMs.
Therefore, PBMs are already working on ways to steer patients away from the drugs their provider recommended and toward other medicines that are more profitable for the health plan. PBMs have a toxic toolbox of strategies with which to accomplish this.
It’s a toolbox I am, sadly, all too familiar with. And it’s a toolbox that patients and physicians across the health care system already struggle with – a string of strategies known as utilization management (UM), designed to push patients away from the medicines that their physicians prescribe and toward the medicines that are most profitable for their health plan.
At the basic level, this means prior authorization, the needless, paperwork-filled step of “proving” that a physician believes a medicine is appropriate for a patient. It includes step therapy, another dangerous delay tactic that requires suffering through an ineffective treatment (or more than one) to get the one that a patient truly needs.
Health plans and PBMs have already been explicit that they plan to roll out that playbook for medicines with the new “maximum fair prices.” A survey of payers and PBMs by a pharmaceutical consultancy found that a majority said they would “add UM or step therapy requirements to steer utilization and prefer competitor products with rebates over negotiated drugs.”
The goal would be to nudge physicians and patients to give up and switch to a medicine that meets the health plan’s goals, not the patient’s needs.
That’s the wrong prescription, quite literally. Stable patients should not be forced off of their life-saving medications and risk a life-threatening consequence that can be costly to Medicare and to patients and their families.
New research from the Global Healthy Living Foundation (GHLF) backs up concerns about how price negotiation will affect patients in terms of real costs for medications to prevent blood clots and strokes in people living with atrial fibrillation. The analysis shows how actions by PBMs to put such medications on a higher formulary tier would increase out-of-pocket costs for patients significantly – in the form of billions. The higher the placement of a drug on formulary tiers, the greater the patient costs.
Part of the solution is vigilance from the government. The Centers for Medicare & Medicaid Services (CMS) knows that payers want to game the law, acknowledging in the new rules for the price regulation program that “Part D sponsors may be incentivized in certain circumstances to disadvantage selected drugs.” But CMS stopped short of creating rules that would guarantee access.
CMS must ensure that health insurance companies don’t institute utilization management barriers that restrict patient access to medicines that have maximum fair prices. After all, the prices are low, and patients are prescribed these medicines because they are medically necessary for their condition. What possible public health rationale could there be for restricting their use?
But that’s only a start. There remain too many ways for insurance companies and PBMs to subtly discourage patients from getting the medicines they need. The toolbox of loopholes that insurers and middlemen have at their disposal is exemplified by tactics such as manipulating drug lists to influence how much medicines cost to dictating prescriptions for specific medications.
All of this gamesmanship is to the detriment of patients. While we should all cheer lower prices for medicines, patients should never have to sacrifice their access to the drugs they need because of it. CMS must enforce oversight to ensure that insurers and PBMs don’t game the system for profit while restricting patient access to crucial, lifesaving medications.
Mellanie True Hills is a patient with atrial fibrillation, the founder and CEO of the American Foundation for Women’s Health and StopAfib.org, and the author of A Woman’s Guide to Saving Her Own Life.
