Proposals to Redesign Medicare Part D - Easing the Burden of Rising Drug Prices

The influence of Medicare Part D on the list pricing of brand drugs

OBJECTIVE

To compare the Medicare Part D market share of brand drugs with their net-to-list price ratio.

DATA SOURCES AND STUDY SETTING

SSR Health Brand Net Price Tool and Medical Expenditure Panel Survey, 2007-2019.

STUDY DESIGN

For each drug, we calculated the ratio of net to list price and the percent of users that were Medicare-eligible. We compared these cross-sectionally in each year and estimated a difference-in-differences model comparing drugs with high or low Medicare market shares (MMS) after following changes to program incentives in 2010.

DATA COLLECTION/EXTRACTION METHODS

The sample included brand drugs without generic competitors appearing in both datasets.

PRINCIPAL FINDINGS

Net-to-list price ratios were negatively correlated with MMS in the later years of our sample. In 2019, a 10% increase in MMS was associated with a significant 4.6% [95% CI: 2.1%, 7.1%] decrease in net-to-list ratio. Difference-in-differences showed net-to-list price ratios of drugs with above median MMS fell relative to those with below median MMS. By 2019, we observe an absolute reduction of -0.2 [95% CI: -0.29, -0.11], representing 28% reduction relative to the average ratio in 2010.

CONCLUSIONS

Greater exposure to the Medicare Part D market was associated with larger differences between net and list prices of drugs.

Pursuing Pharmacoequity: Determinants, Drivers, and Pathways to Progress

The United States pays more for medical care than any other nation in the world, including for prescription drugs. These costs are inequitably distributed, as individuals from underrepresented racial and ethnic groups in the United States experience the highest costs of care and unequal access to high-quality, evidence-based medication therapy. Pharmacoequity refers to equity in access to pharmacotherapies or ensuring that all patients, regardless of race and ethnicity, socioeconomic status, or availability of resources, have access to the highest quality of pharmacotherapy required to manage their health conditions. Herein the authors describe the urgent need to prioritize pharmacoequity. This goal will require a bold and innovative examination of social policy, research infrastructure, patient and prescriber characteristics, as well as health policy determinants of inequitable medication access. In this article, the authors describe these determinants, identify drivers of ongoing inequities in prescription drug access, and provide a framework for the path toward achieving pharmacoequity.

Many Medicare Beneficiaries Do Not Fill High-Price Specialty Drug Prescriptions

For high-price drugs, Medicare Part D beneficiaries who do not receive a low-income subsidy must pay a percentage of the drug's price for each medication fill. Without that subsidy, which lowers out-of-pocket spending, beneficiaries typically pay hundreds or thousands of dollars for a single fill. We estimated the proportion of Part D beneficiaries in fee-for-service Medicare, with and without a subsidy, who do not initiate treatment (that is, do not fill a new prescription) with high-price Part D drugs newly prescribed for four conditions. Examining 17,076 new prescriptions issued between 2012 and 2018 for Part D beneficiaries from eleven geographically diverse health systems, we found that beneficiaries receiving subsidies were nearly twice as likely to obtain the prescribed drug within ninety days as those without subsidies. Among beneficiaries without subsidies, we observed noninitiation for 30 percent of prescriptions written for anticancer drugs, 22 percent for hepatitis C treatments, and more than 50 percent for disease-modifying therapies for either immune system disorders or hypercholesterolemia. Our findings support current legislative efforts to increase the accessibility of high-price medications by reducing out-of-pocket expenses under Medicare Part D, particularly for beneficiaries without low-income subsidies.

Indication-Specific Generic Uptake of Imatinib Demonstrates the Impact of Skinny Labeling

PURPOSE

Generic competition can be delayed if brand-name manufacturers obtain additional patents on supplemental uses. The US Food and Drug Administration allows generic drug manufacturers to market versions with skinny labels that exclude patent-protected indications. This study assessed whether use of generic versions of imatinib varied between indications included and excluded from the skinny labels.

METHODS

In this cross-sectional study, we identified adult patients covered by commercial insurance or Medicare Advantage plans who initiated imatinib from February 2016 (first generic availability) to September 2020. Generic versions were introduced with skinny labels that included indications covering treatment of chronic myelogenous leukemia (CML) but excluded treatment of gastrointestinal stromal tumors (GISTs) because of remaining patent protections. Logistic regression was used to determine whether use of generic versus brand-name imatinib differed between patients with a diagnosis of CML or GIST, adjusting for demographics, insurance type, prior use of brand-name drugs, and calendar month.

RESULTS

Among 2,000 initiators, 934 (47%) had CML and 686 (34%) had GIST. Within 3 years after generics entered the market, more than 90% of initiators in both groups used generic imatinib. Initiation of generic imatinib was slightly lower among patients with GIST than among patients with CML (85% v 88%; adjusted odds ratio 0.56; 95% CI, 0.39 to 0.80; P ≤ .001).

CONCLUSION

Generic versions of imatinib were dispensed frequently for indications both included (CML) and excluded (GIST) from the skinny labeling, although patients with GIST were slightly less likely to receive a generic version. The skinny labeling pathway allowed generics to enter the market before patent protection for treating patients with GIST expired, facilitating lower drug prices.

Characteristics of Prescription Drug Use Among Individuals With Multiple Sclerosis in the US Medicare Population

BACKGROUND

Few studies have characterized the full spectrum of prescription drug use for individuals with multiple sclerosis (MS). The objective of this study was to describe patterns and expenditures for disease-modifying therapies (DMTs) and other prescription drugs among Medicare beneficiaries with MS.

METHODS

Using Medicare claims data in 2014, we identified a cohort of Medicare beneficiaries with 12 months of continuous eligibility and 3 or more MS-related inpatient, outpatient, or prescription claims. We quantified the number, type, and costs of prescribed DMTs and other medications for MS-related symptoms. Medication costs were calculated according to whether beneficiaries received additional subsidies, which eliminate most out-of-pocket costs.

RESULTS

Of 43,283 Medicare beneficiaries identified with MS, 70% were DMT users. Most used self-administered DMTs (67%), and 3% used natalizumab; 93% received a supportive care medication. Among the 82% of individuals without subsidies, the annual median total and out-of-pocket DMT costs were $56,794 (interquartile range [IQR], $44,837-$62,038) and $4566 (IQR, $849-$5270), respectively. The most commonly used supportive care drugs were antidepressants (62%), opioid analgesics (50%), antispasticity drugs (47%), and anticonvulsants (46%). Annual median total and out-of-pocket costs for these drugs were $15,134 (IQR, $6571-$19,620) and $255 (IQR, $56-$877), respectively.

CONCLUSIONS

Most Medicare beneficiaries with MS using DMTs face considerable out-of-pocket costs. Beneficiaries also used a significant number of medications potentially used for MS-related symptoms, although total and out-of-pocket costs were modest.

Assessment of Hypothetical Out-of-Pocket Costs of Guideline-Recommended Medications for the Treatment of Older Adults With Multiple Chronic Conditions, 2009 and 2019

IMPORTANCE

Most adults 65 years or older have multiple chronic conditions. Managing these conditions with prescription drugs can be costly, particularly for older adults with limited incomes.

OBJECTIVE

To estimate hypothetical out-of-pocket costs associated with guideline-recommended outpatient medications for the initial treatment of 8 common chronic diseases among older adults with Medicare prescription drug plans (PDPs).

DESIGN, SETTING, AND PARTICIPANTS

This retrospective cross-sectional study used 2009 and 2019 Medicare prescription drug plan formulary files to estimate annual out-of-pocket costs among hypothetical patients enrolled in Medicare Advantage or stand-alone Medicare Part D plans. A total of 3599 PDPs in 2009 and 3618 PDPs in 2019 were included after inclusion and exclusion criteria were applied. Costs associated with guideline-recommended medications for 8 of the most common chronic diseases (atrial fibrillation, chronic obstructive pulmonary disease [COPD], heart failure with reduced ejection fraction, hypercholesterolemia, hypertension, osteoarthritis, osteoporosis, and type 2 diabetes), alone and in 2 clusters of commonly comorbid conditions, were examined.

MAIN OUTCOMES AND MEASURES

Annual out-of-pocket costs for each chronic condition, inflation adjusted to 2019 dollars.

RESULTS

Among 3599 Medicare PDPs in 2009, 1998 were Medicare Advantage plans and 1601 were stand-alone plans; among 3618 Medicare PDPs in 2019, 2719 were Medicare Advantage plans and 899 were stand-alone plans. For an older adult enrolled in any Medicare PDP in 2019, the median annual out-of-pocket costs for individual conditions varied, from a minimum of $32 (IQR, $6-$48) for guideline-recommended management of osteoporosis (a decrease from $128 [IQR, $102-$183] in 2009) to a maximum of $1579 (IQR, $1524-$2229) for guideline-recommended management of atrial fibrillation (an increase from $91 [IQR, $73-$124] in 2009). For an older adult with a cluster of 5 commonly comorbid conditions (COPD, hypertension, osteoarthritis, osteoporosis, and type 2 diabetes) enrolled in any PDP, the median out-of-pocket cost in 2019 was $1999 (IQR, $1630-$2564), a 12% decrease from $2284 (IQR, $1920-$3107) in 2009. For an older adult with all 8 chronic conditions (atrial fibrillation, COPD, diabetes, hypercholesterolemia, heart failure, hypertension, osteoarthritis, and osteoporosis) enrolled in any PDP, the median out-of-pocket cost in 2019 was $3630 (IQR, $3234-$5197), a 41% increase from $2571 (IQR, $2185-$3719) in 2009.

CONCLUSIONS AND RELEVANCE

In this cross-sectional study, out-of-pocket costs for guideline-recommended outpatient medications for the initial treatment of 8 common chronic diseases varied by condition. Although costs generally decreased between 2009 and 2019, particularly with regard to conditions for which generic drugs were available, out-of-pocket costs remained high and may have presented a substantial financial burden for Medicare beneficiaries, especially older adults with conditions for which brand-name drugs were guideline recommended.

Users of retail medications for opioid use disorders faced high out-of-pocket prescription spending in 2011-2017

INTRODUCTION

High out-of-pocket spending has been a barrier to treatment for the estimated 2.0 million Americans suffering from opioid use disorders (OUD). This paper provides national estimates of financial costs faced by the population receiving retail medications for OUD (MOUD).

METHODS

We used pooled annual data from the 2011-2017 Medical Expenditure Panel Survey (MEPS), a nationally representative sample of the civilian noninstitutionalized population in the United States. The sample includes individuals who reported filling a retail prescription for buprenorphine or naltrexone, the two most common medications available from retail pharmacies to treat OUD. The main outcome is out-of-pocket spending of retail MOUD prescriptions per fill and per person.

RESULTS

Patients with retail MOUD prescriptions spent 3.4 times more out-of-pocket for prescriptions on average than the rest of the U.S. population, with 18.8% of this population paying entirely out-of-pocket for their MOUD prescriptions. Insurance coverage is associated with reduced annual out-of-pocket MOUD expenditures between $316 and $328 per year.

CONCLUSIONS

Future policies that expand insurance and address out-of-pocket spending on MOUD could increase access to medications among individuals with OUD.

Prescription Drug Priorities under the Biden Administration

In January 2021, the incoming Biden administration inherited urgent priorities for curbing health care spending and expanding health care coverage to millions of Americans while also addressing the COVID-19 pandemic and resulting economic downturn. Among these competing priorities is the issue of access to and affordability of prescription drugs. Here, the authors outline Biden's plan for directly lowering prescription drug spending for payers and patients and for expanding access to prescription medications through improved health insurance coverage. These policies could provide important financial protections for Americans against high prescription drug prices. Despite widespread public support for addressing prescription drug prices, many of Biden's plans rely on congressional action, which will be complicated by the narrow majority held by Democrats in the House and an evenly divided Senate. However, there may be other opportunities for reducing prescription drug spending and improving health insurance enrollment among the uninsured. While directly lowering drug prices would provide the most widespread savings for payers and patients alike, any successful effort for increasing the number of Americans enrolled in health insurance or rendering it more affordable will still likely effectively lower patients' out-of-pocket costs and improve access to prescription drugs.

Correlation Between Changes in Brand-Name Drug Prices and Patient Out-of-Pocket Costs

IMPORTANCE

List prices set by manufacturers for brand-name prescription drugs in the US have been increasing faster than inflation, although confidential manufacturer rebates offset some of these increases. Most commercially insured patients pay at least some out-of-pocket costs for prescription drugs, and higher patient spending is associated with lower adherence and worse health outcomes.

OBJECTIVE

To examine whether price changes for brand-name drugs are correlated with changes in patient out-of-pocket spending and whether this association varies by insurance benefit design.

DESIGN, SETTING, AND PARTICIPANTS

A cohort study of 79 brand-name drugs with available pricing data from January 2015 to December 2017 was conducted, with data obtained from a national commercial insurance claims database.

EXPOSURES

Change in the list prices set by manufacturers and estimated net prices after rebates among non-Medicaid payers.

MAIN OUTCOMES AND MEASURES

Change in median out-of-pocket spending among all patients and stratified by insurance pharmacy benefit design, including high-deductible insurance plans and plans with any amount of deductibles or coinsurance.

RESULTS

Among 79 drugs, median increases were 16.7% (interquartile range [IQR], 13.6%-21.1%) for list prices, 5.4% (IQR, -3.9% to 11.7%) for net prices, and 3.5% (IQR, 1.4%-9.1%) for out-of-pocket spending from 2015 to 2017. Changes in list prices were correlated with changes in net prices (r = 0.34; P = .002). Overall, changes in out-of-pocket spending were not correlated with changes in list prices (r = 0.14; P = .22) or net prices (r = 0.04; P = .71). Among 53.7% of patients who paid any drug deductible or coinsurance, median out-of-pocket spending increased by 15.0%, and changes were moderately correlated with changes in list prices (r = 0.38; P = .001) but not net prices (r = 0.06; P = .62).

CONCLUSIONS AND RELEVANCE

Some commercially insured patients who pay only prescription drug copayments appear to be insulated from increases in drug prices. However, more than half of patients pay deductibles or coinsurance and may experience substantial increases in out-of-pocket spending when drug prices increase. Among these patients, there was no evidence that manufacturer rebates to insurers are associated with patients' out-of-pocket spending. Policies to rein in unregulated annual increases in list prices for brand-name drugs may have important consequences for patient out-of-pocket spending.

Non-warfarin oral anticoagulant copayments and adherence in atrial fibrillation: A population-based cohort study

BACKGROUND

In patients with atrial fibrillation, incomplete adherence to anticoagulants increases risk of stroke. Non-warfarin oral anticoagulants (NOACs) are expensive; we evaluated whether higher copayments are associated with lower NOAC adherence.

METHODS

Using a national claims database of commercially-insured patients, we performed a cohort study of patients with atrial fibrillation who newly initiated a NOAC from 2012 to 2018. Patients were stratified into low (<$35), medium ($35-$59), or high (≥$60) copayments and propensity-score weighted based on demographics, insurance characteristics, comorbidities, prior health care utilization, calendar year, and the NOAC received. Follow-up was 1 year, with censoring for switching to a different anticoagulant, undergoing an ablation procedure, disenrolling from the insurance plan, or death. The primary outcome was adherence, measured by proportion of days covered (PDC). Secondary outcomes included NOAC discontinuation (no refill for 30 days after the end of NOAC supply) and switching anticoagulants. We compared PDC using a Kruskal-Wallis test and rates of discontinuation and switching using Cox proportional hazards models.

RESULTS

After weighting patients across the 3 copayment groups, the effective sample size was 17,558 patients, with balance across 50 clinical and demographic covariates (standardized differences <0.1). Mean age was 62 years, 29% of patients were female, and apixaban (43%), and rivaroxaban (38%) were the most common NOACs. Higher copayments were associated with lower adherence (P < .001), with a PDC of 0.82 (Interquartile range [IQR] 0.36-0.98) among those with high copayments, 0.85 (IQR 0.41-0.98) among those with medium copayments, and 0.88 (IQR 0.41-0.99) among those with low copayments. Compared to patients with low copayments, patients with high copayments had higher rates of discontinuation (hazard ratio [HR] 1.13, 95% confidence interval [CI] 1.08-1.19; P < .001).

CONCLUSIONS

Among atrial fibrillation patients newly initiating NOACs, higher copayments in commercial insurance were associated with lower adherence and higher rates of discontinuation in the first year. Policies to lower or limit cost-sharing of important medications may lead to improved adherence and better outcomes among patients receiving NOACs.

Contemporary Patterns of Medicare and Medicaid Utilization and Associated Spending on Sacubitril/Valsartan and Ivabradine in Heart Failure

Importance

In 2015, the US Food and Drug Administration approved 2 new medications for treatment of heart failure with reduced ejection fraction, sacubitril/valsartan and ivabradine. However, few national data are available examining their contemporary use and associated costs.

Objective

To evaluate national patterns of use of sacubitril/valsartan and ivabradine and associated therapeutic spending in Medicare Part D and Medicaid.

Design, Setting, and Participants

In this US nationwide claims-based study, we analyzed data from the Medicare Part D Prescription Drug Event and Medicaid Utilization and Spending data sets to compare national patterns of use of sacubitril/valsartan and ivabradine between 2016 and 2017.

Main Outcomes and Measures

Changes in total spending, per-beneficiary/claim spending, number of beneficiaries, and number of claims between 2016 and 2017 for sacubitril/valsartan and ivabradine.

Results

The number of Medicare beneficiaries prescribed sacubitril/valsartan increased from 35 423 to 90 606 (156% increase from 2016 to 2017). Medicare beneficiaries prescribed ivabradine increased from 15 856 to 23 213 (46% increase). In 2017, Medicare Part D spent $227 million and $7.3 million on sacubitril/valsartan and ivabradine, respectively. This represented increases of 241% and 59% compared with 2016 spending, respectively. The annual Medicare per-beneficiary spending on sacubitril/valsartan and ivabradine was $2512 and $2400. Parallel trends in use patterns and spending were observed among Medicaid beneficiaries.

Conclusions and Relevance

Although initial experiences suggested slow uptake after regulatory approval, these national data demonstrate an increase in use of sacubitril/valsartan and, to a lesser degree, ivabradine in the United States. Current annual per-beneficiary expenditures remain less than spending thresholds that have been reported to be cost-effective. Ongoing efforts are needed to promote high-value care while improving affordability and access to established and emerging heart failure therapies.

Out-of-Pocket Costs for Tyrosine Kinase Inhibitors and Patient Outcomes in EGFR- and ALK-Positive Advanced Non-Small-Cell Lung Cancer

PURPOSE

We investigated the association of out-of-pocket (OOP) costs for tyrosine kinase inhibitors (TKIs) with overall survival (OS) in epidermal growth factor receptor (EGFR)- and anaplastic lymphoma kinase (ALK)-positive advanced non-small-cell lung cancer (NSCLC). We secondarily investigated associations of TKI OOP costs with TKI adherence, duration of therapy (DOT), and TKI discontinuation.

METHODS

We used the Hutchinson Institute for Cancer Outcomes Research registry-claims database to identify patients with stage IV EGFR- or ALK-positive NSCLC; ≥ 1 claims for EGFR or ALK TKIs; and ≥ 3-month survival from TKI initiation. We estimated the average monthly TKI OOP costs per patient up to 3 months from TKI initiation, categorizing patients into quartiles of TKI OOP costs (Q1 < Q2 < Q3 < Q4). We conducted landmark analysis at 3 months from TKI initiation to compare Q1-3 v Q4 TKI OOP costs with respect to OS, TKI DOT, TKI adherence, and TKI discontinuation.

RESULTS

Seventy-eight and twenty-seven patients comprised the Q1-3 and Q4 groups, respectively. Median monthly TKI OOP costs were $1,431 (Q1-3) v $2,888 (Q4). Compared with Q1-3, Q4 patients had inferior OS (adjusted hazard ratio [HR], 1.85; [95% CI, 1.11 to 3.10], similar TKI DOT (adjusted HR, 1.06; 95% CI, 0.53 to 2.15), decreased TKI adherence (adjusted odds ratio [OR], 0.28; 95% CI, 0.10 to 0.76), and higher TKI discontinuation rate (adjusted OR, 8.75; 95% CI, 2.59 to 29.52).

CONCLUSION

Among patients with advanced EGFR- and ALK-positive NSCLC, higher TKI OOP costs are associated with decreased TKI adherence, a higher likelihood of TKI discontinuation, and inferior survival.

60 Years after Kefauver: Household income required to buy prescription drugs in the United States and abroad

BACKGROUND

Assessing drug prices relative to income in the US compared to other Organization for Economic Co-Operation and Development (OECD) countries provides context for policymakers seeking to improve access and affordability.

METHODS

Using current drug p. rice and income data, we recreate a historical analysis presented in 1960 to the Senate Subcommittee on Antitrust and Monopoly led by Sen. Estes Kefauver. We identified frequently prescribed generic and brand name drugs for US and international comparison by drug price category (low-price generics, mid-price brands, and high-price specialty brands) as a function of income. We further extend our analysis to consider US prices relative to the current Federal Poverty Level (FPL).

RESULTS

For the low-price drugs, all fell below 1% of all of the US income levels presented. Mid-price drugs were below 10% of income for those at the US median household income level but approached 30% of income for those at the FPL. High-price drugs varied greatly, reaching over 600% FPL for one product.

CONCLUSIONS

Americans receive bargain prices on par with international comparators for many low-priced generics drugs. For commonly used mid-priced drugs or high-priced specialty products, whether or not drug prices are considered a bargain in the US compared to international markets may depend on individual income. External reference pricing policies may help inform the negotiation for some drug prices, but affordability may still be limited for lower wage earners.

Closing the Part D Coverage Gap and Out-of-Pocket Costs for Multiple Sclerosis Drugs

Objective

To determine whether closing the Part D coverage gap (donut hole) between 2010 and 2019 lowered patients' out-of-pocket costs for disease-modifying therapies (DMTs) for multiple sclerosis (MS).

Methods

Using nationwide Medicare Formulary and Drug Pricing Files, we analyzed Part D drug benefit design and DMT prices in 2010, 2016, and 2019. We calculated average monthly list prices for DMTs available in each year (4 DMTs in 2010, 11 DMTs in 2016, and 14 DMTs in 2019). We projected patients' annual out-of-pocket cost for each DMT alone under a standard Part D plan in that year. We estimated potential savings attributable to closing the coverage gap between 2010 and 2019 (beneficiaries' cost sharing dropped from 100% to 25%) under 3 scenarios: no increase in price, an inflation-indexed price increase (3% annually), and the observed price increase.

Results

Median monthly DMT prices rose from $2,804 to $5,987 to $7,009 over the years 2010, 2016, and 2019, respectively. Median projected annual out-of-pocket costs rose from $5,916 to $6,229 to $6,618. With unchanged or inflation-indexed DMT price changes, closing the coverage gap would have reduced annual out-of-pocket costs by $2,260 (38% reduction) and $1,744 (29% reduction), respectively. Despite having the lowest monthly price, generic glatiramer acetate had among the highest out-of-pocket costs ($6,731 to $6,939 a year) in 2019.

Conclusions

Medicare Part D beneficiaries can pay thousands of dollars yearly out of pocket for DMTs. Closing the Part D coverage gap did not reduce out-of-pocket costs for patients because of simultaneous increases in DMT prices.

A Critical Look at the Efficacy and Costs of Biologic Therapy for Chronic Rhinosinusitis with Nasal Polyposis

PURPOSE OF REVIEW

Chronic rhinosinusitis with nasal polyps (CRSwNP) is a highly prevalent disease that results in significant healthcare-related costs as well as costs to society with lost productivity and time. Unfortunately, a significant percentage of patients who suffer with this disease will not find relief from current standard of care medications and surgery. With ongoing efforts to understand the pathophysiology of CRSwNP has come the introduction of monoclonal antibodies, or "biologics," targeting specific elements of the inflammatory pathway in CRSwNP. Despite efficacy, these come at significant cost and, to date, no studies on the cost-efficacy of these biologics in CRSwNP have been published.

RECENT FINDINGS

Multiple studies have now demonstrated efficacy for biologics in the treatment of CRSwNP as a primary indication. However, the gains in quality of life and objective measures, while consistent, are small and, arguably, the clinical significance is still unclear. In addition, the high cost of these medications may be hard to justify when evaluated in cost-efficacy studies against standard of care therapy in CRSwNP. Furthermore, while the current literature is most robust in showing the benefit of the biologics in asthma, it does not fully support cost-efficacy for biologics. This review evaluates the current literature regarding efficacy of monoclonal antibodies for the treatment of CRSwNP and considers this efficacy in light of the cost implications to individuals and society.

Medicare Part D and Cost-Sharing for Antiretroviral Therapy and Preexposure Prophylaxis

IMPORTANCE

The 2019 federal Ending the HIV Epidemic initiative requires a vast expansion of access to antiretroviral therapy (ART) and preexposure prophylaxis (PrEP) for HIV treatment and prevention. However, high prices for ART and PrEP can reduce their affordability and use. Medicare covers 1 in 4 persons living with HIV, and the Medicare Part D drug benefit imposes complicated cost-sharing between patients and other stakeholders.

OBJECTIVE

To determine how the Medicare Part D design distributes the cost burden for ART and PrEP between patients, insurance plans, manufacturers, and Medicare.

DESIGN AND SETTING

Nationwide cross-sectional analyses of first quarter 2019 Medicare formulary and pricing files for 3326 Part D plans were performed. These files contain drug benefit data, including prices and cost-sharing requirements.

MAIN OUTCOMES AND MEASURES

For 18 ART and 2 PrEP regimens, the out-of-pocket costs for patients and the cost borne by plans, manufacturers, and Medicare were projected for 1 year of treatment or prevention under a 2019 standard Medicare Part D insurance plan. Analyses assumed that patients used the ART or PrEP regimen and no other medications.

RESULTS

In 2019, ART prices ranged from $24 010 to $46 770 annually (median price, $35 780), with patients projected to pay 9% to 14% of the cost ($3270-$4350), insurance plans 18% to 24% ($5340-$8450), manufacturers 6% to 11% ($2370-$2750), and Medicare 53% to 67% ($12 770-$31 270). The price of PrEP was $20 570 annually, with patients contributing 15% ($2990), insurance plans 22% ($4570), manufacturers 13% ($2750), and Medicare 50% ($10 260). For beneficiaries with low-income subsidies that cover all patient cost-sharing, Medicare would assume 67% to 76% of ART costs and 65% of PrEP costs.

CONCLUSIONS AND RELEVANCE

Medicare Part D mandates universal ART and PrEP coverage, but high prices (>$35 000 annually for ART and>$20 000 annually for PrEP) and the design of Part D can jeopardize affordability for patients and place most of the cost burden on taxpayers. Under a standard Medicare Part D benefit, patients pay $3000 to $4000 out-of-pocket yearly, unless they qualify for low-income subsidies, and half to two-thirds of the cost of ART and PrEP is borne by Medicare rather than insurance plans or manufacturers. To end the HIV epidemic by 2030, it appears that policies must address both high drug prices and revamp Medicare Part D cost-sharing.