CAP proposal offers steps to improve Medicare for consumers

The Center for American Progress (CAP) recently submitted a proposal to improve Medicare by offering transparency in drug costs while reducing costs for consumers.

"[CAP urged] the Center for Medicare & Medicaid Innovation to test alternative payment methods for Part B drugs. The Center for Medicare and Medicaid Innovation (CMMI) should also design a model to test a ‘pay for success’ program for Medicare Part B,” Maura Calsyn, director of Health Policy at the Center for American Progress, told American Pharmacy News. “Under that approach, Medicare payments for the new drug would be based on the lower cost of existing drugs. But if the new drug improves average outcomes in real-world populations, Medicare would then supplement the initial payments to align payment with the drug’s added benefits.”

The biggest obstacle in medication accessibility to date is the lack of insurance coverage and the high cost of drugs. “Even when patients have insurance coverage, they may face high-cost sharing. In addition to lowering overall spending for prescription drugs, any reform effort must also ensure that required cost sharing is not excessive. This is particularly important for the most-expensive specialty drugs,” Calsyn said.

If the next president prioritizes this issue, he or she could use the presidential bully pulpit to urge congressional action and increase public awareness and support for reforms to lower drug prices, Calsyn explained.

On the process that should be used to implement reforms, Casyln said, “First, the CMMI can test different reforms, and if a reform is successful, it can be adopted throughout the Medicare program. Second, the federal government can exercise its ‘march-in rights’ and require drug companies to license patents that resulted from federally funded research.”

CAP is an independent nonpartisan policy institute that develops new policy ideas, challenges the media to cover important issues and helps shape the national debate.