CMS Expected To Address Preferred Pharmacy Network Debate In 2016 Call Letter

Pharmacy benefit managers say CMS should put the debate over preferred-pharmacy networks to rest in the draft 2016 Medicare Advantage and Part D Call Letter, which is scheduled to be published Friday (Feb. 20), but community pharmacists would like the agency to propose that all pharmacies may participate in preferred pharmacy networks, as long as they accept network discounts, or proposes stricter network adequacy standards, which could have the effect of opening networks to more pharmacies. Either way, the agency in December said it might propose some kind of preferred pharmacy network policy in the call letter this year.

After expressing interest in opening up preferred pharmacy networks to any pharmacy willing to provide discounts in a controversial Part D rule January 2014, CMS pulled the provision and it was not included in two different rules finalizing proposals from the wide-ranging proposed rule. However, the agency said in its 2015 Medicare Advantage and Part D Call Letter it is worried about beneficiary access to preferred pharmacy networks and is evaluating network adequacy standards for pharmacies offering preferred cost sharing.

Then, in December, CMS said it would eventually propose policy options, possibly in the draft MA and Part D Call Letter that it is releasing Friday.

According to results from a CMS analysis in December on access, plans in suburban and rural areas generally provide convenient access to lower cost sharing, but some networks weren’t providing that access in urban areas. CMS said the results reinforced the agency’s concerns about access to preferred pharmacies, but some stakeholders say the full results of the study are not yet widely available. One pharmacy lobbyist said CMS could release the full results of the study as part of the 2016 Call Letter.

“With this week’s Part D Call Letter, CMS can finally close the book on a year in which millions of seniors feared their plans would be eliminated,” the Pharmaceutical Care Management Association, which represents PBMs, says in a statement. “The year-long saga over controversial Medicare Part D regulations is expected to end this week” with the draft Call Letter, PCMA says.

Others following the issue, however, say the situation isn’t necessarily that clear cut. The pharmacy lobbyist said it’s unlikely CMS will again attempt to open up preferred pharmacy networks with a rule after the congressional and stakeholder backlash it faced after last year’s Part D rule, but it could use guidance, and this year’s Call Letter will not necessarily be the agency’s last word on the subject.

A spokesperson for the National Community Pharmacists Association said if CMS doesn’t act on either preferred network adequacy standards or opening up the preferred networks to pharmacies willing to offer discounts, “we believe it heightens the need for either CMS to act through other vehicles (plan guidance; future regulation; future call letter)” or for lawmakers to move on bipartisan legislation such as Rep. Morgan Griffith’s (R-VA) and Peter Welch’s (D-VT) bill to open preferred pharmacy networks to any pharmacy in medically underserved areas willing to provide discounts. – Michelle M. Stein (

See the original article on the Inside Health Policy website.