The Centers for Medicare and Medicaid Services (CMS) is adding a new prescription drug category classification system to the 2018 risk adjustment model. Starting in 2018, a condition will be identified through a Hierarchical Condition Category with associated medical diagnosis codes, a prescribed medication, or both—each one affecting the final risk member score differently. This paper by Milliman consultants approximates the likely CMS mapping based on the publicly available information to date.
Preferred networks have become the norm in the Medicare Part D landscape. Members typically have a lower cost-sharing requirement when they use a pharmacy in the preferred network. Preferred pharmacies expect to receive a greater share of the carrier’s business and provide the carrier with greater discounts or direct/indirect remuneration (DIR). In this research paper, Milliman’s Jason Gomberg and Michael Hunter analyze 2014 Part D plan profitability to determine if specific pharmacy channels are associated with members that may be more or less profitable for a Medicare Part D carrier.