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New Medicare Advantage Cost-Saving Tool Could Endanger Very Sick Patients

Starting next year, Medicare Advantage plans will be able to add restrictions on expensive, injectable drugs used for treating serious diseases like cancer, rheumatoid arthritis, or macular degeneration. The new rules, released by CMS earlier in August, are part of Trump administration’s bigger strategy to cut pharmaceutical costs.

In short, Medicare Advantage (MA) plans could require newly diagnosed patients to try cheaper drugs first (step therapy), before deciding if they need a more costly option if the initial treatment is ineffective.

A 2012 Obama-era policy legally prohibited Medicare Advantage plans from using step therapy as a cost-saving strategy. By revoking that policy, CMS hopes to save between 15 percent to 20 percent per year; MA plans currently spend about $12 billion a year on Part B drugs.

However, this move is drawing increasing public scrutiny. Some physicians and patient advocates worry that seriously ill patients simply cannot afford to wait until a cheaper treatment proves to be ineffective so they can receive approval for the one their doctor first recommended.

The changes couldn’t have come at a more unfortunate time: a recent report released by The American Cancer Society Cancer Action Network (ACS CAN) shows that almost every states falls behind when it comes to its palliative care or pain policies for cancer patients.

While patients have the option to request an exception to step therapy, the process is so arduous that it discourages people from even trying. Those who decide to opt out of a plan risk going without medications for days, until insurance companies reply back.


Since step therapy has been legally forbidden in Medicare Advantage through the 2012 memo, the Trump administration’s action can be appealed in court.

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