The No Surprises Act: A Bipartisan Achievement to Protect Consumers from Unexpected Medical Bills.

The No Surprises Act, passed by Congress at the end of 2020, offers significant protections to most Americans with private health insurance. Insured Americans are vulnerable to receiving surprise medical bills when they receive services from out-of-network providers. Protections for consumers against such bills initially emerged in several states that passed laws. The varying approaches taken in different state laws ultimately offered a foundation for federal legislation. Although there was always a broad consensus among stakeholders for protecting consumers during both state and federal deliberations, it was a challenge to identify a means of determining the amount that an insurer should pay to the out-of-network provider. But Congress eventually reached a compromise that became law, and that law goes into effect in January 2022.

Trends in Medicare Part D coverage of generics with equivalent brand-name drugs.

OBJECTIVES: To evaluate whether increased placement of generic drugs on higher cost-sharing tiers in Medicare Part D is associated with coverage of multisource brand-name drugs, plan type, or product characteristics. STUDY DESIGN: Descriptive study of Medicare Prescription Drug Formulary Files. METHODS: We analyzed plan coverage and tiering of brand-name drugs and matched generics from 2013-2019. We compared tiering changes and estimated out-of-pocket spending by tier for all Part D plans and by plan type (Medicare Advantage prescription drug [MA-PD] vs stand-alone prescription drug plan [PDP]) for covered generic drugs. Finally, we identified the generic products commonly placed on higher tiers in 2019 and categorized them based on clinical characteristics. RESULTS: Across 5,220,488 plan-product combinations in 2019, 76.4% of generic drug observations reflected coverage on Part D plan formularies, compared with only 12.1% of brand-name drugs. Between 2013 and 2019, the share of observations reflecting covered generics on lower tiers decreased from 76.8% to 53.9%, whereas the share on higher tiers increased from 7.5% to 28.0%. MA-PD plans were more likely than PDPs to place generic drugs on lower tiers, even among plan sponsors offering both plan types. Despite these trends, higher tier placement does not appear to be related to more generous coverage of brand-name products. Instead, in 2019, 70% of high-tier generics had multiple formulations, required heightened clinical monitoring, or had head-to-head treatment options available. CONCLUSIONS: Although Part D plans have increasingly placed covered generic drugs on higher formulary tiers over time, this may be partly explained by a drug's clinical profile and availability of substitutes rather than preferred brand-name drug coverage.

Medicare Part D Plans Rarely Cover Brand-Name Drugs When Generics Are Available.

Recent press reports and other evidence suggest that Medicare Part D plans may be encouraging the use of brand-name drugs instead of generics. However, the scope of such practices is unclear. We examined Medicare Part D formulary coverage and tier placement of matched pairs of brand-name drugs and generics to quantify how often preferred formulary placement of brand-name drugs is occurring within and across Part D plans and to assess the cost implications for Medicare and its beneficiaries. We found that in 2019, 84 percent of 4,176,772 Part D plan-product combinations had generic-only coverage (that is, the brand-name counterparts were not covered). Another 15 percent covered both the brand-name and generic versions of a product. For the small number of products whose brand-name versions were covered preferentially to their generic equivalents, beneficiary and Medicare prices were generally low for both products. Overall, we found that most Part D plan formularies are designed to encourage the use of generics rather than their brand-name counterparts. Policy makers should continue to monitor Part D formulary coverage patterns to ensure consistent and generous coverage for generic drugs, given their important role in reducing prescription drug spending.

Balance Billing by Health Care Providers: Assessing Consumer Protections Across States.

ISSUE: Privately insured consumers expect that if they pay premiums and use in-network providers, their insurer will cover the cost of medically necessary care beyond their cost-sharing. However, when obtaining care at emergency departments and in-network hospitals, patients treated by an out-of-network provider may receive an unexpected "balance bill" for an amount beyond what the insurer paid. With no explicit federal protections against balance billing, some states have stepped in to protect consumers from this costly and confusing practice. GOAL: To better understand the scope of state laws to protect consumers from balance billing. METHODS: Analysis of laws in all 50 states and the District of Columbia and interviews with officials in eight states. FINDINGS AND CONCLUSIONS: Most states do not have laws that directly protect consumers from balance billing by an out-of-network provider for care delivered in an emergency department or in-network hospital. Of the 21 states offering protections, only six have a comprehensive approach to safeguarding consumers in both settings, and gaps remain even in these states. Because a federal policy solution might prove difficult, states may be better positioned in the short term to protect consumers.

Medicare Part D turns four: trends in plan design, enrollment, and the impact of the program on beneficiaries.

PURPOSE: As Medicare Part D enters its fifth year, we assess how the supply side of the market has evolved and what research has shown about how Medicare drug coverage has affected consumers. METHODS: We conduct descriptive data analyses to explore the varied nature of Medicare standalone prescription drug plans (in terms of both price and non-price features), examine features associated with high enrollment, and show trends over time in both plan design and enrollment patterns from 2006 to 2010. We also review existing evidence about Part D's effects on drug access for beneficiaries and conclude with a discussion of current policy concerns. FINDINGS: Medicare Part D has been successful in certain ways, but several areas of concern remain. Although it is a measure of success that 90% of Medicare beneficiaries now have drug coverage, efforts continue to reach the vulnerable populations who are not yet signed up. Use of medications (and relative use of generics) has increased under the program, while out of pocket costs have fallen. Policymakers continue to question government's role in areas such as negotiating prices directly with pharmaceutical manufacturers and limiting the number of plans offered. Results from data analysis indicate, among other things, high growth in premiums, whereas plans have become less generous by certain measures. ORIGINALITY: This chapter brings together data on all plans offered in Medicare Part D standalone drug coverage market and shows new evidence on the landscape's rapid evolution.

Medicare Part D: simplifying the program and improving the value of information for beneficiaries.

Many Medicare beneficiaries signed up for the new Part D benefit during the program's first two years. Subsequently, a significant majority of them reported that the benefit was too complicated, and some observers suggest that the complexity may have thwarted some beneficiaries from finding the plan that was best for them. Meanwhile, more than 4 million of those eligible failed to enroll at all. Although some degree of standardization may occur naturally as the market evolves, steps can be taken to simplify the program and make it easier for beneficiaries to make good choices among plans--and for them to enroll in the first place. This issue brief considers specific options for simplifying Part D in several areas: standardizing the benefit descriptions and procedures used by plans and the Medicare program; further standardization of the plan's benefit parameters, particularly the rules for cost-sharing; and changes to the rules governing plan formularies.

Medicare Advantage: options for standardizing benefits and information to improve consumer choice.

The Medicare Advantage (MA) program offers beneficiaries a choice of private health plans as alternatives to the traditional fee-for-service Medicare program. MA plans potentially provide additional value, but as plan choices have proliferated, consumers contemplating their options have had difficulty understanding how they differ. Through "standardization" more consistent types of information and a limited number of dimensions along which plans vary--MA plans could reduce complexity and improve beneficiaries' ability to make informed choices. Such standardization steps would offer more meaningful variation in the health coverage options available to beneficiaries, Medicare officials and their community partners would find it far easier to educate beneficiaries about their health plan choices, and beneficiaries would better understand what they were buying. Standardization might also strengthen the ability of the market-based Medicare Advantage program to incorporate beneficiary preferences.

Using clinical evidence to manage pharmacy benefits: experiences of six states.

Medicaid agencies report that pharmacy costs are a major driver of overall program spending growth. Many states believe that clinical evidence can be used to curtail pharmacy costs while ensuring beneficiary access to needed prescription drugs. In 2004, researchers from the National Academy for State Health Policy and Georgetown University conducted site visits to examine how state Medicaid agencies in California, Florida, Kansas, Michigan, Missouri, and Washington manage their pharmacy benefits. This brief focuses on states' use of clinical evidence and preferred drug lists. It summarizes the states' experiences in four areas of pharmacy benefit management: the role of pharmaceutical and therapeutics committees in developing preferred drug lists; use of prior approval processes to enforce preferred drug lists; the role played by the Drug Effectiveness Review Project in helping states manage drug utilization; and the management of behavioral health pharmaceuticals.