The Centers for Medicare and Medicaid Services (CMS) recently announced the Part D Senior Savings Model, a new Medicare Part D initiative created to reduce beneficiary cost sharing for insulin products. It is designed to make insulin product cost sharing more affordable and predictable for Medicare beneficiaries. Plans opting to participate in this voluntary Model are required to provide insulin at a maximum $35 copay per 30-day supply in the first three phases of coverage under Medicare Part D.
The new Model also modifies how supplemental benefits, such as a $35 copay, are applied in the coverage gap. Under the current Part D benefit design, if a plan sponsor provides supplemental benefits on applicable drugs in the coverage gap, the manufacturer coverage gap discount of 70% applies only to the beneficiary cost sharing. This increases the plan’s liability in the coverage gap and may discourage a plan from offering supplemental gap benefits for applicable drugs. Through the Model, however, the 70% discount paid by the manufacturer will apply prior to any supplemental benefits.
In this paper, Milliman professionals explore the impact of the Model on patient out-of-pocket costs. Using Milliman’s Part D Claims Database, they apply the Model benefits to observed experience of non-low-income beneficiaries on insulins.