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CMS Highlights Potential Changes that Could Restrict Access to and Increase the Costs of Certain Brand Drugs to Obamacare Enrollees

Summary

The Centers for Medicare & Medicaid Services released the proposed Notice of Benefit and Payment Parameters (NBPP) for the 2020 plan year. The rule could limit exchange plan enrollees' access to certain brand name drugs and increase the out-of-pocket costs within plans.

The annual rule, released yesterday, updates guidance and regulations related to exchanges as well as the broader individual, small group, and large group insurance markets.

The proposed NBPP:

  • Grants plans additional flexibility to insurance companies in managing drug formularies, especially for medications where generics are available, and in determining what costs count toward a consumer’s out-of-pocket limit
  • Proposes changes to the method used to calculate eligibility for advanced premium tax credits and the limit for what consumers pay for care and affordable coverage premiums which could make it harder to qualify for premium assistance and increase consumer exposure to out-of-pocket costs
  • Foreshadows potential future policy to reduce the number of enrollees whose coverage is autorenewed each year (a population of 1.8M enrollees in 2019) and to limit the practice of “silver loading,” which could increase individual market premiums both inside and outside of the exchanges

“The rule underscores the administration’s focus on granting health plans flexibility in managing prescription drug costs,” said Elizabeth Carpenter, practice director at Avalere. “Consumers who take brand medications with generic equivalents could pay more out of pocket for care over time.”

To speak with Avalere experts on the proposed NBPP, connect with us.

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