CMS Allows Step Therapy Under Medicare Advantage Plans

The Centers for Medicare and Medicaid Services (“CMS”) recently announced that, starting next year, Medicare Advantage (“MA”) plans will be allowed to require step therapy on Part B drugs and other physician-administered drugs. Step therapy requires patients to take generic medication as their initial treatment, and only when that treatment is proven to be ineffective, they may step up to more expensive drugs. The point of step therapy is to incentivize drug makers to have the cheapest generic drugs, which will save Medicare money. Step therapy has already been implemented with Medicare Part D drugs, which are drugs from pharmacies, and has proven to be relatively effective in getting drug manufacturers to lower drug prices. Previously, MA plans were not allowed to implement step therapy for Part B drugs because the Obama administration interpreted federal regulations such that MA plans could not be more restrictive than Medicare, and MA plans could not…

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