WHY WE DID THIS STUDY
This report fulfills for 2020 the annual reporting mandate from the Patient Protection and Affordable Care Act (ACA). The ACA requires OIG to conduct a study of the extent to which formularies used by Medicare Part D plans include drugs commonly used by full benefit dual eligible individuals (i.e., individuals who are eligible for both Medicare and full Medicaid benefits). These individuals generally get drug coverage through Medicare Part D. Pursuant to the ACA, OIG must annually issue a report with recommendations as appropriate. This is the tenth report that OIG has produced to meet this mandate.
HOW WE DID THIS STUDY
For this report, we determined whether the 448 unique formularies used by the 4,610 Part D plans operating in 2020 cover the 200 drugs most commonly used by dual eligibles. We also determined the extent to which plan formularies applied utilization management tools to those commonly used drugs. To create the list of the 200 drugs most commonly used by dual eligibles, we used the 2017 Medicare Current Beneficiary Survey-the most recent data available at the time of our study. Of the top 200 drugs, 195 are eligible for Part D prescription drug coverage, 2 are excluded from coverage, 1 is no longer offered as a prescription, and 1 is a medical supply item covered by Part D. One additional drug is eligible for Part D coverage, but we did not include it in our analysis because we could not confidently project the use of this drug to the entire dual-eligible population.
WHAT WE FOUND
Overall, we found that the rate of Part D plan formularies’ inclusion of the 195 drugs commonly used by dual eligibles is high, with some variation. On average, Part D plan formularies include 97 percent of the 195 commonly used drugs. In addition, 75 percent of the commonly used drugs are included by all Part D plan formularies. These results are largely unchanged from OIG’s findings in our mandated annual report from 2019, as well as from the findings in our reports from 2011 through 2018.
We also found that the percentage of drugs to which plan formularies applied utilization management tools increased slightly between 2019 and 2020. On average, formularies applied utilization management tools to 29 percent of the unique drugs we reviewed in 2020, an increase of 1 percentage point from 2019.
WHAT WE CONCLUDE
Inclusion rates for the 195 drugs commonly used by dual eligibles are largely unchanged from the inclusion rates listed in our previous reports. Part D formularies include roughly the same high percentage of these commonly used drugs in 2020 as they did in 2019. As mandated by the ACA, OIG will continue to monitor and produce annual reports on the extent to which Part D plan formularies cover drugs that dual eligibles commonly use. In addition, OIG will continue to monitor Part D plan formularies’ application of utilization management tools to these drugs. OIG has no recommendations at this time.