(Medicare Part D Manual)

A Part D sponsor that uses a formulary under its qualified prescription drug coverage must meet requirements for the following:    Pharmacy and Therapeutics committee;   Provision of an adequate formulary;   Transition process;   Limitation on changes in therapeutic classification;  Provision of notice regarding formulary changes;   Limitation of formulary  changes prior to beginning of contract year;   Provider and patient education; and   Formulary changes during the contract year.   30.1 - Pharmacy and Therapeutics (P&T) Committee  (Rev. 2, Issued:  07- 18-08; Effective/Implementation Date:  07- 18-08)  A Part D sponsors formulary must be developed and reviewed by a P&T committee that meets specific requirements with respect to:    Membership;   Conflict of interest;  P&T member disclosure to CMS;   Meeting administration;  Formulary management;   Formulary exceptions; and  P&T committee role.   30.1.1 - Membership  (Rev. 18, Issued: 01- 15-16, Effective:  01-15-16; Implementation:  01-15-16)  Part D sponsors P&T committee membership must satisfy the following requirements:   P&T committee members must come from various clinical specialties that adequately represent the needs of sponsors enrollees.   A majority of the P&T committee members must be practicing physicians, practicing pharmacists , or both.  CMS defines a practicing physician or pharmacist to be an individual who has an active professional license to practice in the United States or one of its Territories and is currently practicing in the U.S. or one of its Territories.   At least one P&T committee practicing pharmacist and one practicing physician must be an expert in the care of elderly or disabled persons.   At least one P&T committee practicing pharmacist and one practicing physician must be independent and free of conflict with respect to the Part D sponsor and pharmaceutical manufacturers.  Such P&T committee member s may have certain non -employee relationships with pharmaceutical manufacturers (for example consulting, advisory, or research relationships) and still be considered independent and free of conflict provided those relationships do not constitute significant sources of income and they do not otherwise have a conflict of interest that would compromise their independence.  In addition, panel providers in a staff model HMO may be considered independent and free of conflict to the extent that any remuneration re ceived from a Part D sponsor is limited to his or her clinical responsibilities for the care of plan enrollees.   30.1.2 - Conflict of Interest  (Rev. 2, Issued:  07- 18-08; Effective/Implementation Date:  07- 18-08)  P&T committee members should sign a conflict of interest statement revealing economic or other relationships with entities affected by drug coverage decisions that could influence committee decisions.   30.1.3 - P&T Committee Member Disclosure to CMS  (Rev. 2, Issued:  07- 18-08; Effective/Implementa tion Date:  07 -18-08)  In the event the Part D sponsor has entered into a confidential agreement such that the Pharmacy Benefits Manager (PBM) will not disclose its P&T committee membership to the Part D sponsor, then it is the Part D sponsors responsibil ity to notify CMS that this information will be submitted by the sponsors PBM.  Moreover, the Part D sponsor must ensure that the PBM notifies CMS of the P&T committee membership.  The Part D sponsor maintains ultimate responsibility for adhering to and otherwise fully complying with all terms and conditions of its contract and the sponsor must ensure that the PBM notifies the sponsor that this information has been successfully submitted to CMS.   30.1.4 - Meeting Administration  (Rev. 2, Issued:  07- 18-08; Effective/Implementation Date:  07 -18-08)  The Part D sponsors P&T committee should meet on a regular basis, but no less than quarterly.  P&T committee decisions regarding formulary development or revision must be documented in writing.   30.1.5 - Formular y Management  (Rev. 18, Issued: 01- 15-16, Effective:  01-15-16; Implementation:  01-15-16)  Part D sponsors P&T committee will consider the following:    The P&T committee must review for clinical appropriateness the practices and policies for formulary management activities, such as prior authorizations, step therapies, quantity limitations, generic substitutions , and other drug utilization activities that affect access.  P&T committee recommendations regarding these activities are advisory only and not binding on the Part D sponsor.   Formulary management decisions must be based on scientific evidence, and may also be based on pharmacoeconomic considerations that achieve appropriate, safe , and cost effective drug therapy.    The P&T committees will be required to establish and document procedures to ensure appropriate drug review and inclusion.  This includes documentation of decisions regarding formulary development and revision and utilization management activities ( 42 CFR 423.120(b)(1)(viii)).  P&T committee recommendations regarding which Part D drugs are placed on a sponsors formulary are binding on the Part D sponsor.   Clinical decisions by the P&T committee should be based on scientific evidence and standards of practice, including peer reviewed medical literature, well -established clinical practice guidelines , and pharmacoeconomic studies, as well as other sources of appropriate information.   Drugs therapeutic advantages in terms of safety and efficacy must be considered when selecting formulary drugs and placing them on formulary tiers.    The P&T committee will make a reasonable effort to review a new FDA approved drug product (or new FDA approved indication) within 90 days of its release onto the market and will make a decision on each new FDA approved drug product (or new FDA approved indication) within 180 days of its release onto the market, or a clinical justification will be provided if th is timeframe is not met.    The P&T committee will evaluate and analyze treatment protocols and procedures related to the sponsors formulary at least annually.    The P&T committee will approve inclusion or exclusion of the therapeutic classes in the formular y on an annual basis.   Part D sponsors that change pharmacy benefit managers ( PBMs ) mid-year are required to continue the existing formulary.  Decisions regarding formulary inclusion made by the previous PBMs P& T committee are binding on the assuming PBM.  CMS will not approve negative formulary change requests for the purpose of aligning an existing formulary with that of a new PBM.   30.1.6 - Formulary Exceptions  (Rev. 2, Issued:  07- 18-08; Effective/Implementat ion Date:  07- 18-08)  P&T committees must review for clinical appropriateness protocols and procedures for the timely use of and access to both formulary and non- formulary drug products.  Part D coverage determinations and appeals information can be found in chapter 18 of this manual.  30.1.7 - P&T Committee Role in Transition  (Rev. 2, Issued:  07- 18-08; Effective/Implementation Date:  07- 18-08)  At a minimum, a sponsors transition process, the minimum requirements of which are detailed in section 30.4, will address procedures for medical review of non formulary drug requests and, when appropriate, a process for switching new Part D sponsor enroll ees to therapeutically appropriate formulary alternatives failing an affirmative medical necessity determination.  CMS will look to transition process submissions for assurances that a sponsors P&T committee will review and provide recommendations regardi ng the procedures for medical review of non -formulary drug requests.  P&T committee involvement will help ensure that transition decisions appropriately address situations involving enrollees stabilized on drugs that are not on the sponsors formulary (or that are on the formulary but require prior authorization or step therapy under a sponsor's utilization management requirements) and which are known to have risks associated with any changes in the prescribed regimen.   30.2 - Provision of an Adequate Formu lary (Rev. 2, Issued:  07- 18-08; Effective/Implementation Date:  07- 18-08)  CMS encourages Part D sponsors to submit formularies similar to those in widespread use today.  CMS will check the formulary to ensure inclusion of a range of drugs in a broad dist ribution of therapeutic categories and classes, in order to satisfy the Medicare Modernization Act (MMA) requirement that a sponsors categorization system does not substantially discourage enrollment by any group of beneficiaries.  CMS will consider the s pecific drugs, tiering and utilization management strategies employed in each formulary.  CMS will identify outliers from common benefit management practices for further evaluation.  Sponsors may be asked to provide written clinical justification for unusu al benefit features that are identified as outliers.   30.2.1 - Formulary Categories and Classes  (Rev. 18, Issued: 01- 15-16, Effective:  01-15-16; Implementation:  01-15-16)  Part D formularies must include drug categories and classes that cover disease states , consistent with Part D program requirements .  CMS will evaluate the sufficiency of a Part D sponsors formulary categories and classes in conjunction with the formulary drug list to ensure that the formulary provides access to an acceptable range of Par t D drug choices.   Part D sponsors may use existing classification systems, such as those from U.S. Pharmacopeia (USP) and American Hospital Formulary Service (AHFS), or create their own.  CMS will automatically approve formulary classification  systems tha t are consistent with the USP classification system, available at www.usp.org .  For sponsors that choose to adopt an alternative classification structure, CMS will check the sponsors proposed classification system to determine if it is similar to USP or other commonly used classification systems, such as the AHFS Pharmacologic -Therapeutic Classification (information available at http://www.ahfsdruginformation.com/pt -classification -system.aspx).  Each category or class must include at least two drugs (u nless only one drug is available for a particular category or class, or only two drugs are available but one drug is clinically superior to the other for a particular category or class), regardless of the classification system that is utilized.  The two dr ug minimum requirement must be met through the provision of two chemically distinct drugs.  In other words, Part D sponsors will not meet this requirement by including only two dosage forms or strengths of the same drug, or a brand name drug and its generi c equivalent.  Aside from the inclusion of two drugs in each category or class, multiple strengths and dosage forms should also be available for each covered drug.  This should encompass dosage forms used commonly in long term care ( LTC ) facilities and home infusion.  CMS may require more than two drugs for particular categories or classes if additional drugs present unique and important therapeutic advantages in terms of safety and efficacy, and their absence from the sponsors formulary would substantially discourage enrollment by beneficiaries with certain disease states.   30.2.1.1 - Application of Existing or New Drugs into the Current Version of the USP Model Guidelines (Rev. 18, Issued: 01- 15-16, Effective:  01-15-16; Implementation:  01-15-16)  For those formularies that utilize the USP Model Guidelines classification structure, there are several methods to accommodate new Part D drugs that come on to the market during the contract year s between revisions of the Guidelines .  These methods may also be utilized to accommodate existing Part D drugs that have not been classified under the USP Model Guidelines.  CMS expects one of the four options listed below to be used for the above mentioned situations.  1.  Addition of a Par t D drug into an existing USP category or class. In the event that a new Part D drug is approved and is to be added to the formulary, the newly approved Part D drug may fit into the current classification system.  For instance, if a new protease inhibitor is approved, this drug would be added to the formulary in the USP Antivirals category, under the Anti -HIV Agents, Protease Inhibitors class.  2.  Placement of a Part D drug into an Other class. In the current USP Model Guidelines, USP listed an Other class under various categories.  Should a new Part D drug receive approval that cannot be placed into an existing class, and the particular USP category contains an Other class, the new drug may be placed into the Other class.   3.  Addition of a new cla ss under an existing category.  If a new Part D drug is approved that does not fit into an existing class, but is appropriate for a particular category, then a new class may be displayed under an existing category.  This method would also apply to formularies that utilize AHFS or another classification structure.   4.  Miscellaneous Therapeutic Agents. If an existing or newly approved Part D drug does not fit into any existing category, a Miscellaneous Therapeutic Agents category may be displayed on the formulary.   30.2.2 - Formulary Benefit Management Tools  (Rev. 18, Issued: 01- 15-16, Effective:  01-15-16; Implementation:  01-15-16)