Does not address PBM abuses or ensure generic sustainability
WASHINGTON, DC (October 16, 2024) – The Association for Accessible Medicines today commented on the Centers for Medicare & Medicaid Services request for information on a potential demonstration program to test the use of a $2 copay for certain generic drugs for Medicare recipients. AAM reiterated earlier research that shows addressing PBM abuses has an even greater potential for savings for seniors.
AAM appreciate CMS’s interest in lowering seniors’ costs through encouraging generic adoption. Unfortunately, this proposal does nothing to prevent PBM rebate games, ensure adoption of new generics, or otherwise secure the long-term sustainability of generic drug competition,
said AAM. Further, the demonstration project runs counter to a multi-year trend whereby PBMs and plans continue to move generics to formulary tiers with higher patient copays.
Independent research from Avalere shows that Medicare drug plans continue to place generic medicines in higher price tiers. In 2011, 73% of generic drugs analyzed by Avalere were placed on Tier 1 with a zero-dollar copay on average. Ten years later, only 15% of those drugs were still on Tier 1. Instead, the frequency of generics being placed on Tier 3, which has an average copay of $42, has skyrocketed from 4% to 24% in ten years. As a result, sixty percent of Medicare beneficiaries paid the full cost of at least one generic drug in 2021.
AAM continued, Plans can already do what CMS is suggesting, and they have actually done the opposite, shifting more generics to formulary tiers with higher copays. The best way to create greater savings for seniors is to ensure the rapid coverage of new generics and the placement of generic drugs on generic formulary tiers with copays reflecting the cost of the generic.
CMS is accepting public comment on the demonstration project until December 9.
