ACR Praises CMS on Part D Proposals, Calls for Changes to APMs

November 22, 2017
The Center for Biosimilars Staff

The American College of Rheumatology (ACR) has voiced its approval of CMS’ attempts to lower the cost of drugs under Medicare Part D, but also called on the organization to allow more rheumatologists, including those in small practices, to take part in alternative payment models (APMs).

The American College of Rheumatology (ACR) has voiced its approval of CMS’ attempts to lower the cost of drugs under Medicare Part D, but also called on the organization to allow more rheumatologists, including those in small practices, to take part in alternative payment models (APMs).

Proposed Changes to Medicare Part D

In a November 20 statement, ACR praised the feature of CMS’ proposed rule that would revise the definition of generic drugs to include biosimilars, which CMS refers to as “follow-on biological products,” solely for the purposes of cost-sharing. “Lower-cost alternatives can improve enrollee incentives to choose follow-on biological products over more expensive reference biological products, and can reduce costs to both Part D and Medicare Advantage,” said ACR.

The organization also praised proposed measures to reduce the price of drugs by requiring pharmacy benefit managers (PBMs) to provide a percentage of manufacturers’ rebates negotiated for a drug covered under Part D in the product’s point-of-sale price. “We applaud CMS for exploring mechanisms to lower drug costs through greater pricing transparency on the part of [PBMs],” said ACR. “We are also encouraged that CMS is taking steps to update guidance regarding discriminatory cost-sharing practices.”

However, ACR raised concerns over CMS’ proposal to allow for mid-year formulary changes for generic drugs, saying that patients must have ample time to prepare for any medication switches that may be necessitated by those changes. The proposed rule would permit Part D sponsors to remove brand-named drugs from formularies and replace them immediately with therapeutically equivalent generics upon FDA approval. (Under the proposed rule, all biosimilars would be treated as brand-name drugs and not as generics for the purposes of transitions or mid-year formulary changes, as no biosimilars have been deemed interchangeable by the FDA.) ACR said, “We believe enrollees should have ample notification on any medication switches.”

Alternative Payment Models

ACR is also asking CMS to institute changes that will better allow providers in small practices to participate in alternative payment models (APMs). APMs allow rheumatology practices to comply with the Medicare Access and CHIP Reauthorization Act of 2015 without being subject to the merit-based incentive payment system. However, according to ACR, the financial risk and patient thresholds associated with APMs are too high to allow many practices to participate.

In comment letter to CMS, ACR’s president, David I. Daikh, MD, PhD, said, “We strongly suggest to CMS a proposal to lower the threshold for requirements to make 'qualifying participant' in an advanced APMs more achievable for smaller practices. We propose CMS lower the patient count threshold from 20% to 10%, lower the payment threshold from 25% to 15%, and consider delaying or softening the planned year-over-year increases in these thresholds.”

ACR is currently developing its own APM, which it unveiled this month at the organization’s annual meeting in San Diego, California, specific to the treatment of rheumatoid arthritis.