Chris reviews recent developments for the Inflation Reduction Act of 2022 (IRA). He then recommends four IRA-related adjustments that manufacturers should make to their patient support programs.
To learn more, register for ConnectiveRx’s free webinar on September 17: IRA Reality Check: Adapting Hub and Copay Programs to Ensure Patient Access and Affordability.
Read on for Chris’s insights.
IRA Reality Check: Four Strategies for Adapting Hub and Copay Programs
By Chris Dowd, Senior VP of Market Development, ConnectiveRx
Since then, there have been numerous developments surrounding the IRA, from lawsuit updates to price negotiations, and pressure on hub and copay programs continues to mount. Let’s examine some of the latest trends and see how they could impact hub and affordability programming.
NEW NEWS ON THE IRA
- Additional guidance on Medicare Prescription Payment Plan (MP3) OOP smoothing: On July 16, 2024, HHS issued final part-two guidance on implementing the Medicare Prescription Payment Plan, which allows Part D enrollees to pay OOP drug costs in monthly installments.
- First 64 brands hit with inflation penalties: On June 26, 2024, HHS announced inflation penalties for 64 prescription drugs under the IRA’s Medicare Prescription Drug Inflation Rebate Program. These drugs will have lowered Part B coinsurance rates from July 1 – September 30, 2024.
- Anti-IRA lawsuit failures: Despite facing legal setbacks, major pharmaceutical companies—including Johnson & Johnson, Bristol Myers Squibb, and AstraZeneca—are continuing their legal battle against the IRA’s Medicare price negotiations.
- Price negotiation progress: Manufacturers involved in the first cycle of Medicare drug price negotiations are continuing their discussions with HHS. Negotiated prices should be published by September 1, 2024, and will take effect in 2026.
- Wildcard—Chevron Deference overturn: On June 28, 2024, the US Supreme Court overturned the “Chevron deference,” a 40-year-old doctrine that required federal courts to defer to a federal agency's reasonable interpretation of ambiguous statutes that the agency administers. The Court held that Chevron deference gave unelected officials too much authority. Many healthcare regulations may be at risk, including the IRA’s price negotiation, inflation penalties, and Part D redesign.
Unlike other industry dangers that failed to materialize—such as the accumulator “best price” rule that died via court order back in 2022—key provisions of the IRA are actually proceeding, and will continue to do so barring successful challenges in the courts or changes to the law by Congress. Even if Republicans sweep in 2024, full repeal is unlikely, although a "tweak around the edges" is possible.
The potential risks are real:
- Financial Impact: Reduced revenue and profit margins of pharmaceutical manufacturers due to price negotiations, inflation penalties, and Part D redesign.
- Operational Uncertainty: Lack of clarity on implementation details, calculation methods, and potential spillover effects.
- Market Disruption: Fears of competitive disadvantages, pricing inflexibility, and potential changes in market dynamics.
- Access and Utilization Changes: Concerns about increased utilization management, changes in patient access, and the need to redesign patient support programs.
- Innovation Suppression: Concerns that lower revenues will lead to decreased R&D investment.
WHAT IRA-RELATED HUB- AND COPAY-PROGRAM ADJUSTMENTS SHOULD MANUFACTURERS CONSIDER?
Begin with a thorough risk assessment for the entire portfolio and each brand. This is crucial for identifying vulnerabilities and opportunities for strategic adjustments. By leveraging scenario analysis/modeling, holistic financial modeling, and strategic scenario planning, manufacturers can ensure continued patient access and affordability while managing the IRA’s financial pressures.
Where adjustments are required, consider these four actions to bolster branded patient support programming:
1. Deploy Up-to-Date Tools. Manufacturers must keep patient support tools like eBV on the cutting edge to ensure seamless integration with critical IRA-related benefits changes. eBV tools with predictive analytics capabilities can streamline the verification process, reduce administrative burdens, and improve patient satisfaction.
2. Bolster Best Practices for Navigating ePA and Other Utilization Management Tactics. To enhance patient support in the face of IRA-driven access hurdles, manufacturers should integrate ePA systems with EHRs and adhere to the latest industry practices. Streamlining ePA processes reduces therapy initiation delays, improving adherence and outcomes.
3. Retrain Case Managers, BV Specialists, and Call Center Staff. Continuous education for patient-support-program staff is vital. Training in insurance, healthcare policies, and support technologies enables staff to provide accurate and empathetic assistance, especially surrounding MP3.
4. Flex Staffing Models Based on Patient Counts/Forecasts. Although the future is impossible to predict, the IRA may simultaneously drive the demand for both decreases in hub and copay program staffing (due to lower revenue/profit and improved automation) and increases in staffing (due to increased insurer utilization management, required copay smoothing, etc.). Flexible staffing models allow manufacturers to adjust their workforces up or down as an uncertain future gains clarity.
As the industry grapples with the realities of price negotiations, inflation penalties, and Part D redesign, manufacturers must adapt their hub and copay programs to ensure continued patient access and affordability.
To learn how brand and access leaders can continue to offer robust patient support despite the challenges brought about by the IRA, register for our September 17th free webinar: IRA Reality Check: Adapting Hub and Copay Programs to Ensure Patient Access and Affordability.
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