Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 405, 417, 422, 423, 460, and 498

[CMS-4182-F]

RIN 0938-AT08

Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program

AGENCY:

Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION:

Final rule.

SUMMARY:

This final rule will revise the Medicare Advantage (MA) program (Part C) regulations and Prescription Drug Benefit program (Part D) regulations to implement certain provisions of the Comprehensive Addiction and Recovery Act (CARA) to further reduce the number of beneficiaries who may potentially misuse or overdose on opioids while still having access to important treatment options; implement certain provisions of the 21st Century Cures Act; support innovative approaches to improve program quality, accessibility, and affordability; offer beneficiaries more choices and better care; improve the CMS customer experience and maintain high beneficiary satisfaction; address program integrity policies related to payments based on prescriber, provider and supplier status in MA, Medicare cost plan, Medicare Part D and the PACE programs; provide an update to the official Medicare Part D electronic prescribing standards; and clarify program requirements and certain technical changes regarding treatment of Medicare Part A and Part B appeal rights related to premiums adjustments.

DATES:

Effective Date:

This rule is effective June 15, 2018.

The incorporation by reference of certain publications listed in the rule is approved by the Director of the Federal Register as of June 15, 2018.

Applicability Dates:

The applicability date of the provisions of this rule is January 1, 2019 except for the provisions in §§ 422.100(f)(4) and (5) and 422.101(d) (discussed in section II.A.4. of this final rule (Maximum Out-of-Pocket Limit for Medicare Parts A and B Services)) and § 422.100(f)(6) (discussed in section II.A.5. of this final rule (Cost Sharing Limits for Medicare Parts A and B Services)). Those provisions are applicable for contract year 2020 (January 1, 2020). E-Prescribing and the Part D Prescription Drug Program; Updating Part D E Prescribing Standards discussed in section II.D.8. of this final rule is applicable January 1, 2020 conditioned on The Office of the National Coordinator for Health Information Technology (ONC) adopting the same standard for use in its Electronic Health Record Certification Program by that date.

FOR FURTHER INFORMATION CONTACT:

Theresa Wachter, (410) 786-1157, Part C Issues.

Marie Manteuffel, (410) 786-3447, Part D Issues.

Kristy Nishimoto, (206) 615-2367, Beneficiary Enrollment and Appeals Issues.

Raghav Aggarwal, (410) 786-0097, Part C and D Payment Issues.

Vernisha Robinson-Savoy, (443) 826-9925, Compliance Program Training Issues.

Frank Whelan, (410) 786-1302, Preclusion List Issues.

Shelly Winston, (410) 786-3694, Part D E-Prescribing Program.

SUPPLEMENTARY INFORMATION:

I. Executive Summary and Background

A. Executive Summary

1. Purpose

The primary purpose of this final rule is to make revisions to the Medicare Advantage (MA) program (Part C) and Prescription Drug Benefit Program (Part D) regulations based on our continued experience in the administration of the Part C and Part D programs and to implement certain provisions of the Comprehensive Addiction and Recovery Act and the 21st Century Cures Act. The changes are necessary to—

• Support Innovative Approaches to Improving Quality, Accessibility, and Affordability;

• Improve the CMS Customer Experience; and

• Implement Other Changes.

In addition, this final rule makes technical changes related to treatment of Part A and Part B premium adjustments and updates the NCPDP SCRIPT standard used for Part D electronic prescribing. While the Part C and Part D programs have high satisfaction among enrollees, we continually evaluate program policies and regulations to remain responsive to current trends and newer technologies, and provide increased flexibility to serve patients. Specifically, this regulation meets the Administration's priorities to reduce burden and provide the regulatory framework to develop MA and Part D products that better meet the individual patient's health care needs. These changes being finalized will empower MA and Part D plans to meet the needs of enrollees at the local level, and should result in more enrollee choice and more affordable options. Additionally, this regulation includes a number of provisions that will help address the opioid epidemic and mitigate the impact of increasing drug prices in the Part D program.

2. Summary of the Major Provisions

a. Implementation of the Comprehensive Addiction and Recovery Act of 2016 (CARA) Provisions

In line with the agency's response to the President's call to end the scourge of the opioid epidemic, this final rule implements statutory provisions of the Comprehensive Addiction and Recovery Act of 2016 (CARA), which amended the Social Security Act and was enacted into law on July 22, 2016. CARA includes new authority for Medicare Part D plans to establish drug management programs effective on or after January 1, 2019. Through this final rule, CMS has established a framework under which Part D plan sponsors may establish a drug management program for beneficiaries at risk for prescription drug abuse or misuse, or “at-risk beneficiaries.” Specifically, under drug management programs, Part D plans will engage in case management of potential at-risk beneficiaries, through contact with their prescribers, when such beneficiary is found to be taking a specific dosage of opioids and/or obtaining them from multiple prescribers and multiple pharmacies who may not know about each other. Sponsors may then limit at-risk beneficiaries' access to coverage of controlled substances that CMS determines are “frequently abused drugs” to a selected prescriber(s) and/or network pharmacy(ies) after case management with the prescribers for the safety of the enrollee. CMS also limits the use of the special enrollment period (SEP) for dually- or other low income subsidy (LIS)-eligible beneficiaries by those LIS-eligible beneficiaries who are identified as at-risk or potentially at-risk for prescription drug abuse under such a drug management program. Finally, these provisions will codify the current Part D Opioid Drug Utilization Review (DUR) Policy and Overutilization Monitoring System (OMS) by integrating this current policy with drug management program provisions.

Through the adoption of this policy, from 2011 through 2017, there was a 76 percent decrease (almost 22,500 beneficiaries) in the number of Part D beneficiaries identified as potential very high risk opioid overutilizers. Thus, drug management programs will expand upon an existing, innovative, successful approach to reduce opioid overutilization in the Part D program by improving quality of care through coordination while maintaining access to necessary pain medications, and will be an important next step in addressing the opioid epidemic and safeguarding the health and safety of our nation's seniors.

b. Revisions to Timing and Method of Disclosure Requirements

Consistent with agency efforts supporting innovative approaches to improve quality, accessibility, and affordability and reduce burden, we are finalizing changes to align the MA and Part D regulations in authorizing CMS to set the manner of delivery for mandatory disclosures in both the MA and Part D programs. CMS will use this authority to allow MA plans to meet the disclosure and delivery requirements for certain documents by relying on notice of electronic posting and provision of the documents in hard copy when requested, when previously the documents, such as the Evidence of Coverage (EOC), had to be provided in hard copy. Additionally, we are changing the timeframe for delivery of the MA and Part D EOC to the first day of the Annual Election Period (AEP), rather than 15 days prior to that date. Allowing Part C and Part D plans to provide the EOC electronically will alleviate plan burden related to printing and mailing and reduce the number of paper documents that enrollees receive from plans. Changing the date by which plans must provide the EOC to enrollees will allow plans more time to finalize the formatting and ensure the accuracy of the information in the EOC. Changing the date will also separate the mailing and receipt of the EOC from the Annual Notice of Change (ANOC), which describes the important changes in a patient's plan from one year to the next. The ANOC must be delivered 15 days prior to the AEP and will be received by enrollees ahead of the EOC, thus allowing enrollees to focus on materials that drive decision-making during the AEP. We see this final change as an overall reduction of burden that our regulations have on plans and enrollees. In aggregate, we estimate a savings (to plans for not producing and mailing hardcopy EOCs) of approximately $54.7 million each year, 2019 through 2023.

c. Preclusion List Requirements for Prescribers in Part D and Individuals and Entities in MA, Cost Plans, and PACE

This final rule will rescind current regulatory provisions that require prescribers of Part D drugs and providers of MA services and items to enroll in Medicare in order for the Part D drug or MA service or item to be covered. As a replacement, a Part D plan sponsor will be required to reject, or require its pharmacy benefit manager to reject, a pharmacy claim for a Part D drug if the individual who prescribed the drug is included on the “preclusion list.” Similarly, an MA service or item will not be covered if the provider that furnished the service or item is on the preclusion list. The preclusion list will consist of certain individuals and entities that are currently revoked from the Medicare program under 42 CFR 424.535 and are under an active reenrollment bar, or have engaged in behavior for which CMS could have revoked the individual or entity to the extent applicable if they had been enrolled in Medicare, and CMS determines that the underlying conduct that led, or would have led, to the revocation is detrimental to the best interests of the Medicare program. We believe that this change from an enrollment requirement to a preclusion list requirement will reduce the burden on Part D prescribers and MA providers without compromising our program integrity efforts.

3. Summary of Costs, Savings and Benefits of the Major Provisions

Provision

Savings and benefits

Costs

Implementation of the Comprehensive Addiction and Recovery Act of 2016

The purpose of this provision is to create a lock-in status for certain at-risk beneficiaries. In addition to the benefits of preventing opioid and benzodiazepine dependency in beneficiaries, we estimate, in 2019, a reduction of $19 million in Trust Fund expenditures because of reduced opioid scripts. This $19 million reduction modestly increases to a $20 million reduction in 2023

The creation of lock in-status is a burden to plans. The cost to industry is estimated at about $2.8 million per year. This $2.8 million cost arises from (i) the uploading and preparing of additional notices to enrollees ($101,721), (ii) the re-negotiation of contracts between Part D sponsors and pharmacies ($547,415), (iii) the programming of edits about lock-ins into the systems of Part D sponsors ($2,152,332), and (iv) the right of enrollees to appeal a status of lock-in ($35,183).

Revisions to Timing and Method of Disclosure Requirements

We estimate 67% of the current 47.8 million beneficiaries will prefer use of the internet versus hard copies. This will result in a savings to the industry of $54.7 million each year, 2019 through 2023. This is due to a reduction in printing and mailing costs

Preclusion List Requirements for Prescribers in Part D and Individuals and Entities in MA, Cost Plans, and PACE

For 2019, this provision saves providers $34.4 million. For 2020 and future years, there are no savings. The $34.4 million in savings to providers arises because of removal of the requirement of MA providers and suppliers and Part D prescribers to enroll in Medicare as a prerequisite for furnishing health care items and services. Part C providers and suppliers save $24.1 million in reduced costs while Part D providers save $10.3 million in reduced costs

For 2019, this provision costs Part D sponsors or their PBMs $9.3 million. For 2020 and future years, costs are negligible (below $50,000). The $9.3 million cost arises because of programming and staff resources needed to produce and send required notifications to enrollees and prescribers.

Physician Incentive Plans—Update Stop-Loss Protection Requirements

For 2019, this provision reduces required reinsurance resources by $204.6 million. The $204.6 million savings increases yearly because of expected enrollment increases and medical inflation; the savings is $281.8 million in 2023. The savings arise because we are replacing the current insurance schedule in the regulation with updated stop-loss insurance requirements that will allow insurance with higher deductibles. This updated schedule will result in a significant reduction to the cost of obtaining stop-loss insurance. The higher deductibles are consistent with the increase in medical costs due to inflation. Through transfers, the 2019 $204.6 million savings results in $71.6 savings to the Medicare Trust Fund and $133 million savings (in the form of rebates) to Medicare Advantage (MA) organizations. It is likely that some of the savings to MA organizations will result in increased health care benefits to MA enrollees

B. Background

In the proposed rule titled “Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program” which appeared in the November 28, 2017

Federal Register

(82 FR 56336), we proposed to revise the Medicare Advantage program (Part C) regulations and Prescription Drug Benefit program (Part D) regulations to implement certain provisions of the Comprehensive Addiction and Recovery Act (CARA) and the 21st Century Cures Act; improve program quality, accessibility, and affordability; improve the CMS customer experience; address program integrity policies related to payments based on prescriber, provider and supplier status in Medicare Advantage, Medicare cost plan, Medicare Part D and the PACE programs; provide a proposed update to the official Medicare Part D electronic prescribing standards; clarify program requirements; and make certain technical changes regarding treatment of Medicare Part A and Part B appeal rights related to premium adjustments.

We received approximately 1,669 timely pieces of correspondence containing multiple comments on the CY 2019 proposed rule. While we are finalizing several of the provisions from the proposed rule, there are a number of provisions from the proposed rule that we intend to address later and a few that we do not intend to finalize. We also note that some of the public comments were outside of the scope of the proposed rule. These out-of-scope public comments are not addressed in this final rule. Summaries of the public comments that are within the scope of the proposed rule and our responses to those public comments are set forth in the various sections of this final rule under the appropriate heading. However, we note that in this final rule we are not addressing comments received with respect to the provisions of the proposed rule that we are not finalizing at this time. Rather, we will address them at a later time, in a subsequent rulemaking document, as appropriate.

II. Provisions of the Proposed Rule and Analysis of and Responses to Public Comments

A. Supporting Innovative Approaches to Improving Quality, Accessibility, and Affordability

1. Implementation of the Comprehensive Addiction and Recovery Act of 2016 (CARA) Provisions

a. Medicare Part D Drug Management Programs

The Comprehensive Addiction and Recovery Act of 2016 (CARA), enacted into law on July 22, 2016, amended the Social Security Act and includes new authority for the establishment of drug management programs in Medicare Part D, effective on or after January 1, 2019. In accordance with section 704(g)(3) of CARA and revised section 1860D-4(c) of the Act, CMS must establish through notice and comment rulemaking a framework under which Part D plan sponsors may establish a drug management program for beneficiaries at-risk for prescription drug abuse, or “at-risk beneficiaries.” Under such a Part D drug management program, sponsors may limit at-risk beneficiaries' access to coverage of controlled substances that CMS determines are “frequently abused drugs” to a selected prescriber(s) and/or pharmacy(ies). While such programs, commonly referred to as “lock-in programs,” have been a feature of many state Medicaid programs for some time, prior to the enactment of CARA, there was no statutory authority to allow Part D plan sponsors to require beneficiaries to obtain controlled substances from a certain pharmacy or prescriber in the Medicare Part D program. Thus, although drug management programs are voluntary, this rule codifies a framework that will place requirements upon such programs when established by Part D sponsors.

This final rule implements the CARA Part D drug management program provisions by integrating them with the current Part D Opioid Drug Utilization Review (DUR) Policy and Overutilization Monitoring System (OMS) (“current policy”).

1

This integration will mean that Part D plan sponsors implementing a drug management program could limit an at-risk beneficiary's access to coverage of frequently abused drugs beginning 2019 through a beneficiary-specific point-of-sale (POS) claim edit and/or by requiring the beneficiary to obtain frequently abused drugs from a selected

pharmacy(ies) and/or prescriber(s) after case management and notice to the beneficiary. To do so, the beneficiary will have to meet clinical guidelines that factor in that the beneficiary is taking opioids over a sustained time period and that the beneficiary is obtaining them from multiple prescribers and/or multiple pharmacies. This final rule also implements a limitation on the use of the special enrollment period (SEP) for low income subsidy (LIS)-eligible beneficiaries who are identified as potential at-risk beneficiaries or at-risk beneficiaries.

1

In using the term “current policy”, we refer to the aspect of our current Part D opioid overutilization policy that is based on retrospective DUR and case management. Please refer to the CMS website, “Improving Drug Utilization Review Controls in Part D” at

https://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/RxUtilization.html

which contains CMS communications regarding the current policy.

We received the following general comments and our responses follow:

Comment:

Commenters were overall supportive of our proposal. Some commenters found it to be a conservative and uniform approach to implementing the CARA drug management program provisions. Other commenters included specific suggestions for improvements with their overall supportive or neutral comments.

Response:

We thank the commenters for their comments. We summarize and respond to specific recommendations later in this preamble.

Comment:

We received a request that we confirm that nothing in the final rule impacts PACE organizations' waivers of Part D requirements in § 423.153. This commenter also asked that existing waivers of § 423.153 be extended to include § 423.153(f) unless such a waiver is not needed due to the voluntary nature of drug management programs.

Response:

PACE organizations are not excluded from OMS reporting under the current policy. Additionally, because of the voluntary nature of the provisions under § 423.153(f), a waiver is not necessary for PACE organizations. However, to the extent that PACE organizations commence drug utilization management activities covered under § 423.153(f), PACE organizations must comply with the requirements of 423.153(f).

Comment:

We received comments that expressed concern about the time needed for Part D plan sponsors to make the necessary systems changes to implement compliant drug management programs.

Response:

Section 704(g)(1) of CARA states that the amendments made by this section shall apply to prescription drug plans (and MA-PD plans) for plan years beginning on or after January 1, 2019. However, given the current national opioid epidemic, we expect that Part D sponsors will diligently implement fully-functional drug management programs in 2019. Moreover, as the new requirements for drug management programs build from and are integrated with existing policy, we expect sponsors will be able to implement them expeditiously.

Comment:

We received one suggestion that CMS pilot different approaches for implementing the CARA drug management program provisions, specifically the “lock-in” provisions, as we did before implementing our current policy.

Response:

Because the CARA drug management provisions will be integrated with our current policy, albeit with some modifications to that policy, we are not persuaded that an additional pilot is necessary since plan sponsors already have experience with addressing potential opioid overutilization.

Comment:

A commenter requested that CMS acknowledge the work it will take for Standard Development Organizations (SDOs) to implement the finalized CARA provisions. In particular, the commenter noted that development of any codes and messaging associated with the new CARA-related requirements will take time to implement.

Response:

We understand that any modifications to existing standards to accurately achieve the desired functionalities to further the electronic exchange of information between healthcare stakeholders about the final CARA provisions may require time. We rely on SDOs to coordinate these efforts, and CMS is committed to working with the SDOs during this process, if needed.

Comment:

A commenter requested clarification on how to handle concurrent DUR edits, such as formulary-level cumulative opioid MME safety edits, and the drug management program. Specifically, the comment sought clarification on whether the drug management program beneficiary-specific POS claim edits or lock-in limitations would take precedence over an approved exception to a cumulative opioid MME safety edit.

Response:

A plan sponsor may implement formulary-level coverage rules for opioids (that is, prior authorization, quantity limits or step therapy) or safety edits, and implement a drug management program. The formulary and coverage rules would apply to all enrollees (unless they obtain an exception), and the drug management program would apply to potential at-risk and at-risk beneficiaries. A Part D sponsor's concurrent and retrospective DUR programs should be closely coordinated. In certain circumstances, it may be appropriate for a sponsor to make an at-risk determination through the drug management program for a beneficiary who received an approved exception to a cumulative opioid MME safety edit, and as part of the at-risk determination, may determine that continuing the approved exception is no longer appropriate.

For example, a plan implemented a hard formulary-level cumulative MME opioid edit at 200 MME with 2 or more opioid prescribers. A beneficiary received their opioids from 2 prescribers and has a cumulative MME that exceeds 200 MME. They trigger the edit and request a coverage determination. The prescriber attests to medical necessity and the exception request is approved. At a later time, the beneficiary seeks opioids from 3 additional prescribers, and meets the CARA/OMS criteria. Through case management, the prescriber verifies the beneficiary is at-risk and agrees to prescriber lock-in due to care coordination issues.

b. Integration of CARA and the Current Part D Opioid DUR Policy and OMS

Our proposal was to integrate the CARA Part D drug management program provisions with our current policy and codify them both. Specifically, under this regulatory framework, we proposed that Part D plan sponsors may voluntarily adopt drug management programs through which they address potential overutilization of frequently abused drugs identified retrospectively through the application of clinical guidelines/OMS criteria that identify potential at-risk beneficiaries and conduct case management which incorporates clinical contact and prescriber verification that a beneficiary is an at-risk beneficiary. If deemed necessary, a sponsor could limit at-risk beneficiaries' access to coverage for such drugs through pharmacy lock-in, prescriber lock-in, and/or a beneficiary-specific point-of-sale (POS) claim edit. Finally, sponsors would report to CMS the status and results of their case management through OMS and any beneficiary coverage limitations they have implemented through MARx, CMS' system for payment and enrollment transactions. Thus, although drug management programs are voluntary, our proposal was to codify a framework that will place requirements upon such programs when established by Part D sponsors.

We stated that we foresee that all plan sponsors will implement such drug management programs based on our experience that all plan sponsors are complying with the current policy; the fact that our proposal largely incorporates the CARA drug management provisions into existing

CMS and sponsor operations; and especially, in light of the national opioid epidemic and the declaration that the opioid crisis is a nationwide Public Health Emergency.

Comment:

Commenters expressed strong support for integrating the drug management program provisions of CARA with the current policy. Commenters expressed that our proposal is reasonable, thoughtful, thorough, practical, and comprehensive; that it builds on a successful existing Medicare Part D program; that it will involve a common set of procedures and help ensure a streamlined and efficient process rather than creating a separate one that would require additional oversight and add administrative burden. We did not receive comments that opposed integrating the drug management program provisions of CARA with the current policy.

Response:

We thank the commenters for their supportive comments and are finalizing this integration approach to our proposal.

(1) Requirements for Part D Drug Management Programs (§§ 423.100 and 423.153)

We proposed the following definitions in establishing requirements for Part D drug management programs.

(i) Definitions (§ 423.100)

(A) Definition of “Potential At-Risk Beneficiary” and “At-Risk Beneficiary” (§ 423.100)

Section 1860D-4(c)(5)(C) of the Act contains a definition for “at-risk beneficiary” that we proposed to codify at § 423.100. In addition, although the section 1860D-4(c)(5) of the Act does not explicitly define a “potential at-risk beneficiary,” it refers to a beneficiary who is potentially at-risk in several subsections.

Accordingly, we proposed to define these two terms at § 423.100 as follows: Potential at-risk beneficiary means a Part D eligible individual—(1) Who is identified using clinical guidelines (as defined in § 423.100); or (2) With respect to whom a Part D plan sponsor receives a notice upon the beneficiary's enrollment in such sponsor's plan that the beneficiary was identified as a potential at-risk beneficiary (as defined in paragraph (1) of this definition) under the prescription drug plan in which the beneficiary was most recently enrolled, such identification had not been terminated upon disenrollment, and the new plan has adopted the identification.

At-risk beneficiary means a Part D eligible individual—(1) who is—(i) Identified using clinical guidelines (as defined in § 423.100); (ii) Not an exempted beneficiary; and (iii) Determined to be at-risk for misuse or abuse of such frequently abused drugs under a Part D plan sponsor's drug management program in accordance with the requirements of § 423.153(f); or (2) With respect to whom a Part D plan sponsor receives a notice upon the beneficiary's enrollment in such sponsor's plan that the beneficiary was identified as an at-risk beneficiary (as defined in paragraph (1) of this definition) under the prescription drug plan in which the beneficiary was most recently enrolled, such identification had not been terminated upon disenrollment, and the new plan has adopted the identification. We noted that we included the phrase, “and the new plan has adopted the identification” to both definitions for cases where a beneficiary has been identified as a potential at-risk or at-risk beneficiary by the immediately prior plan to indicate that the beneficiary's status in the subsequent plan is not automatic.

We received the following comments and our response follows:

Comment:

A commenter did not believe that a definition for a “potential at-risk beneficiary” was needed, nor the additional prescriber verification the commenter associated with the definition.

Response:

We disagree. Although as we noted above, section 1860D-4(c)(5) of the Act does not explicitly define a “potential at-risk beneficiary,” it refers to a beneficiary who is potentially at-risk in section 1860D-4(c)(5)(B)(ii), which addresses initial notices; in 1860D-4(c)(5)(H)(i) which addresses data disclosures; and in section 1860D-4(c)(5)(I) which addresses the sharing of information for subsequent plan enrollments. Therefore, we proposed to define a potential at-risk beneficiary in § 423.100, as the CARA drug management program provisions clearly contemplate this status for a beneficiary.

With respect to additional prescriber verification of a potential at-risk beneficiary, we believe this comment is based on a misunderstanding of our proposal, as we did not propose that a beneficiary's status as a potential at-risk beneficiary must be verified. Rather, we proposed and are finalizing a requirement, as we discuss later in this preamble, that a prescriber must verify that a beneficiary is at-risk, which serves as his or her professional opinion that a Part D plan sponsor takes into account during case management.

Comment:

We received a question whether an individual who is subject to lock-in under his or her Medicaid program and then becomes dually-eligible constitutes a potential or at-risk beneficiary under our proposed definitions.

Response:

Such a beneficiary would not automatically be considered to be a potential at-risk or an at-risk beneficiary under a Part D sponsor's drug management program. Rather, whether such a beneficiary is a potential at-risk or at-risk beneficiary would depend upon whether he or she meets the clinical guidelines and is determined to be an at-risk beneficiary under the process set forth in this rule. An automatic determination based on a beneficiary's inclusion and status in a Medicaid drug management program would not be appropriate because each Medicaid drug management program has its own criteria and requirements for reviewing and addressing recipients who may be at-risk for prescription drug abuse or misuse and its own interventions. We also note that Medicaid programs are not required to comply with section 1860D-4(c)(5) as Part D drug management programs are.

To the extent a Part D sponsor is aware or discovers based on reliable information that a beneficiary who meets the clinical guidelines was locked-in under a Medicaid drug management program, that sponsor may consider that information in deciding whether to determine that a beneficiary is an at-risk beneficiary under the requirements of this final rule. Also, any beneficiary entering the Part D program will be immediately subject to their plan's formulary-level controls to address opioid overutilization before they may be identified as potentially at-risk, so any opioid overutilization by the beneficiary in his or her new Part D plan may be addressed by these controls.

Comment:

We received a comment requesting clarification with regard to a person who is locked-in under an employer plan and then becomes eligible for a Part D EGWP, if the EGWP can continue the lock-in in the Part D plan or at least consider the prior lock-in as part of a new determination.

Response:

Beginning with plan year 2019, Part D sponsors, including sponsors of EGWPs, may adopt drug management programs that meet the requirements we are finalizing in this rule. Under a Part D prescription drug management program, sponsors may implement a prescriber and/or pharmacy lock-in or beneficiary-specific POS claim edit for frequently abused drugs with respect to an at-risk beneficiary. Similar to a Medicaid beneficiary who becomes newly eligible for Medicare and enrolls in Part D, a person who is locked-in under a

commercial plan does not automatically meet the definition of an at-risk beneficiary we are finalizing in § 423.100. Rather, such a person first must be determined to be an at-risk beneficiary in accordance with the requirements we are finalizing at § 423.153(f).

In other words, in order for a beneficiary to be eligible to be immediately locked-in to a prescriber or pharmacy in a Part D plan in which they are newly enrolled, the plan from which they most recently disenrolled must be a Part D plan in which he or she was determined to be an at-risk beneficiary under that plan's drug management program. When a new enrollee comes from a non-Part D plan in which the beneficiary was subject to lock-in, however, the sponsor can consider the prior lock-in if it learns or knows of it based upon reliable information which is legally available to the sponsor in conjunction with the information it gathers from the case management process, the beneficiary, and the sponsor's other relevant internal sources and data.

Comment:

A commenter asked if a Part D sponsor may consider opioid utilization information from external sources during case management, such as a state prescription drug monitoring program (PDMP) in making the determination if a beneficiary is at-risk.

Response:

As noted above with respect to beneficiaries who were locked-in under an employer or Medicaid plan before enrolling in Medicare Part D, we encourage sponsors to use all reliable sources legally available to them to obtain an accurate account of a potential at-risk or at-risk beneficiary's utilization of frequently abused drugs.

After considering the comments, we are finalizing the definition of potential at-risk beneficiary and at-risk beneficiary with minor modifications for clarity. First, we are removing the phrase “and the new plan adopted the identification” from paragraph (2) of both definitions. As we noted above, the purpose of this language was to indicate that the beneficiary's at-risk status in the subsequent plan is not automatic, which we meant for purposes of the limitation on the special enrollment period (SEP) for LIS beneficiaries with an at-risk status. However, as we discuss later in this preamble, this limitation will be triggered or continued by Part D sponsors sending the initial and second notices to such beneficiaries, as applicable, so we no longer believe this phrase is necessary in these definitions.

Second, we also are making a minor clarifying change in the definition of at-risk beneficiary to explicitly acknowledge that it is the Part D sponsor that determines which beneficiaries are at-risk beneficiaries under its drug management program.

The definition of potential at-risk beneficiary will read: A Part D eligible individual—(1) Who is identified using clinical guidelines (as defined in § 423.100); or (2) With respect to whom a Part D plan sponsor receives a notice upon the beneficiary's enrollment in such sponsor's plan that the beneficiary was identified as a potential at-risk beneficiary (as defined in paragraph (1) of this definition) under the prescription drug plan in which the beneficiary was most recently enrolled and such identification had not been terminated upon disenrollment. The definition of at-risk beneficiary will read:

At-risk beneficiary

means a Part D eligible individual—(1) Who is—(i) Identified using clinical guidelines (as defined in § 423.100); (ii) Not an exempted beneficiary; and (iii) Determined to be at-risk for misuse or abuse of such frequently abused drugs by a Part D plan sponsor under its drug management program in accordance with the requirements of § 423.153(f); or (2) With respect to whom a Part D plan sponsor receives a notice upon the beneficiary's enrollment in such sponsor's plan that the beneficiary was identified as an at-risk beneficiary (as defined in the paragraph (1) of this definition) under the prescription drug plan in which the beneficiary was most recently enrolled and such identification had not been terminated upon disenrollment.

(B) Definition of “Frequently Abused Drug”, “Clinical Guidelines”, “Program Size”, and “Exempted Beneficiary” (§ 423.100)

Because we use these terms in the proposed definitions of “potential at-risk beneficiary” and “at-risk beneficiary,” we proposed to define “frequently abused drug”, “clinical guidelines”, “program size”, and “exempted beneficiary” at § 423.100 as follows:

• Frequently Abused Drug

Section 1860D-4(c)(5)(G) of the Act defines “frequently abused drug” as a drug that is a controlled substance that the Secretary determines to be frequently abused or diverted. Consistent with the statutory definition, we proposed to define “Frequently abused drug” at § 423.100 to mean a controlled substance under the Federal Controlled Substances Act that the Secretary determines is frequently abused or diverted, taking into account the following factors: (1) The drug's schedule designation by the Drug Enforcement Administration; (2) Government or professional guidelines that address that a drug is frequently abused or misused; and (3) An analysis of Medicare or other drug utilization or scientific data. This definition is intended to provide enough specificity for stakeholders to know how the Secretary will determine a frequently abused drug, while preserving flexibility to update which drugs CMS considers to be frequently abused drugs based on relevant factors, such as actions by the Drug Enforcement Administration and/or trends observed in Medicare or scientific data. Since we did not receive any specific comments to change this definition, we are finalizing it as proposed.

Comment:

A commenter requested that CMS include the criteria, resources, and the evidence basis upon which it will rely to determine that a drug is a frequently abused drug for purposes of a drug management program.

Response:

The definition of frequently abused drug that we are finalizing indicates that criteria, resources, and evidence basis will be the DEA schedule designation, government, and professional drug guidelines, and analyses of drug utilization or scientific data.

We did not receive any further comment on the definition of “frequently abused drug” and are therefore finalizing it as proposed.

Consistent with current policy, we proposed that opioids are frequently abused drugs, except buprenorphine for medication-assisted treatment (MAT) and injectables. As we stated in the preamble to the proposed rule, we plan to publish and update a list of frequently abused drugs for purposes of Part D drug management programs.

Comment:

All commenters agreed that the Secretary should determine that opioids are frequently abused drugs, many referencing the national opioid overuse epidemic.

Response:

We appreciate that stakeholders are focused on the opioid public health emergency.

Comment:

Some of these commenters agreed with our proposal to determine only opioids, except buprenorphine for medication-assisted treatment (MAT) and injectables, as frequently abused drugs, at least in the initial implementation of Part D drug management programs, in order to allow CMS and stakeholders to focus on opioid overuse and gain experience with the use of lock-in as a tool to address overutilization in the Part D program, before potentially determining other controlled substances as

frequently abused drugs. These commenters urged CMS to wait until drug management programs were established, and testing and monitoring indicate that the program can be administered in a manner that does not limit beneficiary access to needed medications before expanding the programs further. Some of these commenters were concerned that an at-risk beneficiary would have to obtain all frequently abused drugs from one pharmacy or one prescriber and that this could disrupt patient care if the pharmacy did not carry all frequently abused drugs.

However, some commenters urged us to determine that all controlled substances are frequently abused drugs. These commenters were particularly focused on a determination as to benzodiazepines, and to a lesser extent, muscle relaxants. Due to this focus, these commenters referred to the CDC Guideline that specifically recommends that clinicians avoid prescribing opioid pain medication and benzodiazepines concurrently whenever possible due to increased risk for overdose. They also referred to CMS work in this area: (1) The fact that CMS added a concurrent benzodiazepine-opioid flag to OMS in October 2016 in response to the CDC Guideline and after our own research on the use of benzodiazepines among Medicare beneficiaries

2

to alert Part D sponsors that concurrent use may be an issue that should be addressed during case management;

3

and (2) the fact that we have stated that a sponsor may implement a beneficiary-specific claim edit at POS for non-opioid medications under the current policy.

4

They further referred to a statistic from the National Institute on Drug Abuse that 30 percent of overdoses involving opioids also involve benzodiazepines.

5

Finally, these commenters pointed out that the FDA has found that the growing combined use of opioid medicines with benzodiazepines or other drugs that depress the central nervous system has resulted in serious side effects, including slowed or difficult breathing and deaths. These commenters further noted that in an effort to decrease the use of opioids and benzodiazepines, and opioids and other such depressants, the FDA added

Boxed Warnings—

its strongest warnings—to the drug labeling of prescription opioid pain and cough medicines, and benzodiazepines.

6

Given these developments, these commenters stressed the importance of Part D plan sponsors being able to use the tools that will be available to them under drug management programs to address the dangers of concurrent opioid and benzodiazepine use.

2

https://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/Downloads/Concurrent-Use-of-Opioids-and-Benzodiazepines-in-a-Medicare-Part-D-Population-CY-2015.pdf.

3

Please refer to the memo, “Medicare Part D Overutilization Monitoring System (OMS) Update: Addition of the Concurrent Opioid-Benzodiazepine Use Flag” dated October 21, 2016.

4

Supplemental Guidance Related to Improving Drug Utilization Review Controls in Part D” September 6, 2012.

5

https://www.drugabuse.gov/drugs-abuse/opioids/benzodiazepines-opioids.

6

https://www.fda.gov/Drugs/DrugSafety/ucm518473.htm.

Response:

In light of these comments, we are persuaded that it is appropriate that drug management programs are able to address concurrent opioid and benzodiazepine use. Such a determination is consistent with the definition of frequently abused drugs that we are finalizing. First, the Secretary determines benzodiazepines are frequently abused or diverted, taking into account that they are controlled substances under the Controlled Substances Act (CSA) and that prescription benzodiazepines are on Schedule IV, where the DEA places substances that have a potential for abuse. In addition, the Secretary takes into account that the FDA has issued a warning about the risks associated with using opioids and benzodiazepines concurrently. Further, the CDC included in its evidence-based opioid prescribing guideline a caution to co-prescribe opioids and benzodiazepines. Finally, CMS' own statistics reveal that 51 percent of Part D beneficiaries that will be identified as potentially at-risk under the 2019 clinical guidelines we are finalizing are using opioids and benzodiazepines concurrently compared to 24 percent across all Part D opioid users. This statistic is indicative that concurrent use is even more of a danger among potential at-risk beneficiaries than Medicare Part D beneficiaries generally. Therefore, the Secretary determines that benzodiazepines are a frequently abused drug for purposes of Part D drug management programs beginning in 2019. However, the clinical guidelines will still only consider a beneficiary's opioid use, as we explain just below.

Comment:

A commenter agreed with our statement in the proposed rule that there is difficulty in establishing overuse guidelines for non-opioid substances. The commenter stated that this underscores the need for a robust evidence base to support determining that additional types of drugs are frequently abused drugs.

Response:

We agree with the commenter's concern, and for this reason we are not modifying the clinical guidelines for 2019 to include benzodiazepine use, even though benzodiazepines will be considered a frequently abused drug for 2019. This means that a beneficiary who is determined to be at-risk based on clinical guidelines that look at the beneficiary's opioid use could have a coverage limitation applied under a drug management program to both opioids and benzodiazepines to manage current and future concurrent use. For example, a sponsor could require an at-risk beneficiary to obtain both opioids and benzodiazepines from one selected pharmacy.

We believe that this is appropriate based on the robust evidence that concurrent benzodiazepine use with opioids results in an even higher risk of an adverse health event than use of opioids alone. We will expect to rarely see a sponsor apply a limitation only to an at-risk beneficiary's access to coverage for benzodiazepines, since to do so, the beneficiary would have to have met the clinical guidelines which look at opioid use that is potentially risky. However, we acknowledge that prescriber agreement during case management could rarely lead to such an outcome. For example, no opioid prescriber agrees to a beneficiary-specific POS claim edit for opioids, but rather, all but one states they will no longer prescriber opioids to coordinate the beneficiary's use. However, the benzodiazepine prescriber agrees to such an edit for benzodiazepines. We discuss prescriber agreement in more detail later in this preamble.

Given that we are finalizing two categories of drugs as frequently abused drugs for 2019, depending upon what a plan sponsor learns during case management, we reiterate that the sponsor may have to permit a beneficiary to obtain frequently abused drugs from more than one pharmacy and/or more than one prescriber in order to provide reasonable access, if the sponsor applies lock-in as a coverage limitation, which we discuss later in this preamble.

Comment:

A few commenters suggested that Part D sponsors be able to expand their drug management programs to include additional frequently abused drugs based on their experience with their enrollees. One suggested that a sponsor be required to submit such an expansion to CMS for approval.

Response:

We disagree with this comment. Section 1860D-4(c)(5)(G) of the Act defines “frequently abused

drug” as a drug that is a controlled substance that the Secretary determines to be frequently abused or diverted. Consistent with this statutory provision, we believe it is appropriate that the determination of frequently abused drugs not be plan-specific, but rather be consistent across Part D plans, as this will permit better oversight and promote consistency across all Part D drug management programs.

We proposed that future determinations of frequently abused drugs by the Secretary primarily be included in the annual Medicare Parts C&D Call Letter or in similar guidance, if necessary, to address midyear entries to the drug market or evolving government or professional guidelines or relevant data analysis, which will be subject to public comment. We proposed that this approach would be consistent with our approach under the current policy and necessary for Part D drug management programs to be responsive to changing public health issues over time.

Comment:

We received comments supportive of our proposal to apply the standards we are establishing in rulemaking to future determinations of frequently abused drugs through the annual Medicare Parts C&D Call Letter, or in similar guidance. We did not receive any comments that opposed this proposed approach.

Response:

We appreciate the comments.

Comment:

A commenter asked us to confirm that we would use the same process to determine that a drug is no longer a frequently abused drug.

Response:

We will apply the same regulatory standards and use the same process that we use to determine that a drug is a frequently abused drug when determining that a drug no longer is a frequently abused drug for purposes of Part D drug management programs.

Comment:

A few commenters urged CMS to exclude abuse-deterrent (AD) opioids from this definition of “frequently abused drug” as there is no evidentiary data to support the thesis that AD opioids are frequently abused and existing observation data supports their exclusion from this broad standard.

Response:

The FDA requires a boxed warning on opioid abuse-deterrent formulations (ADFs), because even with these formulations there is still potential for addiction, abuse, misuse, and diversion. The FDA has also noted

7

that “abuse-deterrent technologies have not yet proven successful at deterring the most common form of abuse—swallowing a number of intact capsules or tablets to achieve a feeling of euphoria. Moreover, the fact that a product has abuse-deterrent properties does not mean that there is no risk of abuse. It means, rather, that the risk of abuse is lower than it would be without such properties.” Also, ADFs do not prevent patients who may be using opioids for therapeutic reasons from taking higher doses than prescribed or diverting the opioid. For these reasons, we disagree that abuse-deterrent formulations should be excluded from the determination of frequently abused drugs.

7

“Abuse-Deterrent Opioids—Evaluation and Labeling Guidance for Industry”, U.S. Department of Health and Human Services, Food and Drug Administration, Center for Drug Evaluation and Research (CDER), Clinical Medical, April 2015.

Comment:

A few commenters asked CMS to clarify whether methadone, a Part D drug when indicated for pain, would be included in the definition of a frequently abused drug under the drug management program. Other commenters agreed with excluding buprenorphine for MAT from the definition of frequently abused drug as not to limit patient access to treatment and noted that removing buprenorphine as a frequently abused drug is consistent with the CDC's approach to exclude buprenorphine from the determination of a person's daily opioid MME.

Response:

Yes, methadone for pain is included in the definition of a frequently abused drug for purposes of Part D drug management programs, consistent with current policy/OMS. Although buprenorphine is recognized by the DEA as a drug of abuse, we thank the commenters that agreed with excluding buprenorphine for MAT from the definition of frequently abused drug so that access to MAT, such as buprenorphine, is not impacted. However, the commenters' reference to the CDC's exclusion of buprenorphine from the determination of a person's daily opioid MME made us believe that commenters may be conflating the definition of a frequently abused drug with the clinical guidelines and associated opioid dosage thresholds. Therefore, we realize that we need to be more specific about what opioid use, opioid prescribers, and opioid dispensing pharmacies means in the clinical guidelines, which we also discuss later.

Since the publication of the proposed rule, the CDC removed the conversion factors for all formulations of buprenorphine, for pain and for MAT, from the most recent CDC MME conversion factor file (

https://www.cdc.gov/drugoverdose/data-files/CDC_Oral_Morphine_Milligram_Equivalents_Sept_2017.xlsx

). Therefore, CMS cannot determine the MME. As such, buprenorphine products are not used to determine the beneficiary's average daily MME. However, we will still use prescription opioids, including all formulations of buprenorphine for pain and MAT, to determine opioid prescribers and opioid dispensing pharmacies in the clinical guidelines.

• Clinical Guidelines & Program Size

Section 1860D-4(c)(5)(C)(i)(I) of the Act requires at-risk beneficiaries to be identified using clinical guidelines that indicate misuse or abuse of frequently abused drugs and that are developed by the Secretary in consultation with stakeholders. We proposed to include a definition of “clinical guidelines” that cross references standards that we proposed at § 423.153(f) for how the guidelines will be established and updated. Specifically, we proposed to define clinical guidelines for purposes of a Part D drug management program in § 423.100 as criteria to identify potential at-risk beneficiaries who may be determined to be at-risk beneficiaries under such programs, and that are developed in accordance with the standards in § 423.153(f)(16) and beginning with contract year 2020, will be published in guidance annually.

We also proposed to add § 423.153(f)(16) to state that potential at-risk beneficiaries and at-risk beneficiaries are identified by CMS or a Part D sponsor using clinical guidelines that: (1) Are developed with stakeholder consultation; (2) Are based on the acquisition of frequently abused drugs from multiple prescribers, multiple pharmacies, the level of frequently abused drugs, or any combination of these factors; (3) Are derived from expert opinion and an analysis of Medicare data; and (4) Include a program size estimate. This proposed approach to developing and updating the clinical guidelines is intended to provide enough specificity for stakeholders to know how CMS will determine the guidelines by identifying the standards we will apply in determining them.

This proposed approach also indicated that the program size will be determined as part of the process to develop the clinical guidelines—a process into which stakeholders will provide input. Section 1860D-4(c)(5)(C)(iii) of the Act states that the Secretary shall establish policies, including the guidelines and exemptions, to ensure that the population of enrollees in drug management programs could be effectively managed by plans. We proposed to define “program size” in

§ 423.100 to mean the estimated population of potential at-risk beneficiaries in drug management programs (described in § 423.153(f)) operated by Part D plan sponsors that the Secretary determines, as part of the process to develop clinical guidelines, can be effectively managed by such sponsors.

Comment:

We did not receive any specific comments about the definition we proposed for clinical guidelines in § 423.100, nor the standards we proposed in § 423.153(f)(16).

Response:

We are therefore finalizing the definition and standards as proposed, with one modification adding language so that the guidelines will be published in guidance annually beginning with contract year 2020 guidance, since we are publishing the 2019 clinical guidelines in this final rule.

Comment:

We received comments supportive of our proposal to apply the standards we are establishing in rulemaking for clinical guidelines in § 423.153(f)(16) to develop future OMS criteria through the annual Medicare Parts C&D Call Letter process beginning with plan year 2020.

We did not receive comments that specifically opposed this proposed approach.

Response:

We appreciate these comments.

Because Part D drug management programs will be integrated with the current policy/OMS beginning in 2019, there will be no separate OMS criteria in 2019 and beyond. For plan year 2019, we proposed the clinical guidelines to be the OMS criteria established for plan year 2018. The clinical guidelines for use in drug management programs we proposed for 2019 are: Use of opioids with an average daily MME greater than or equal to 90 mg for any duration during the most recent 6 months and either: 4 or more opioid prescribers and 4 or more opioid dispensing pharmacies

OR

6 or more opioid prescribers, regardless of the number of opioid dispensing pharmacies.

We estimated that these criteria would identify approximately 33,053 potential at-risk beneficiaries in the Part D program based on 2015 data, whom we believe are at the highest risk of death or overdose due to their opioid use. Also, under our proposal, we stated that Part D plan sponsors will not be able to vary the criteria of the guidelines to include more or fewer beneficiaries in their drug management programs, as they may under the current policy, except that we proposed to continue to permit plan sponsors to apply the criteria more frequently than CMS will apply them through OMS in 2018, which can result in sponsors identifying beneficiaries earlier. This is because CMS evaluates enrollees quarterly using a 6-month look back period, whereas sponsors may evaluate enrollees more frequently (for example, monthly).

We also described other clinical guidelines that we considered in the Regulatory Impact Analysis section of the proposed rule. Stakeholders were invited to comment on those options and any others that would identify more or fewer potential at-risk beneficiaries.

Comment:

We received comments that were overall supportive of the clinical guidelines/criteria we proposed for 2019 with the estimated program size of 33,053. However we did receive a few comments suggesting criteria for the clinical guidelines that were not among the alternate options we included in the RIA. Some of these supportive comments supported the guidelines without reservation, making statements such as noting the guidelines align with the CDC Guideline or that they understood or supported CMS' desire to gain experience with the use of lock-in as a drug management tool before adopting clinical guidelines with flexibility and/or that would identify more potential at-risk beneficiaries. These commenters want CMS to adopt a clear and universal set of guidelines which minimizes customer and provider confusion, as well as administrative burden when submitting and receiving OMS quarterly reports. These commenters assert that voluntary plan guidelines would increase confusion and fragmentation across the Medicare landscape. However, some commenters urged that Part D plan sponsors should have complete flexibility to identify potential at-risk beneficiaries, or at least some flexibility to identify additional ones consistent with our current policy. These commenters emphasized that sponsors should be able to establish and update targeting criteria and program features based on evolving clinical evidence and feedback and the specific needs of their members. Some of these commenters referred to the experience Part D sponsors and their PBMs have gained in identifying opioid overutilization among their plan members over the last several years and the need to be able to do more to address the opioid overuse crisis. Some commenters referred in particular to beneficiaries who do not have an average daily MME of greater or equal to 90 mg but who are filling opioids prescriptions from many different prescribers or pharmacies that they may currently address but would not be able to under our proposal. These commenters pointed out that such beneficiaries benefit from better coordination of care, which case management and coverage limitations on frequently abused drugs can support. Another commenter referred to beneficiaries with high dose utilization regardless of the number of prescribers as appropriate for review by drug management programs.

As to program size, a commenter stated that the proposed clinical guidelines would identify a reasonable number of potential at-risk beneficiaries. Another commenter proposed alternative criteria involving a lower MME level that it stated would identify more than 300,000 Part D beneficiaries as potentially at-risk, whereas the other commenters (including those commenters that requested increased flexibility) did not provide a program size estimate. On the other hand, we did not receive comments that the clinical guidelines we proposed would identify a potential at-risk beneficiary population that cannot be effectively managed by Part D plan sponsors, and because the proposed guidelines are the same as the OMS criteria for 2018 that were established through the 2018 Parts C&D Call Letter process, we did not expect such comments.

We received a few comments that the proposed clinical guidelines appear to be aimed at primarily limiting the program size arbitrarily rather than permitting scientific evidence and clinical research to dictate the most appropriate guidelines.

Response:

We appreciate the commenters that provided a specific suggestion for criteria; however, these criteria were not among the alternate options we included in the RIA. Therefore, we decline to adopt these suggestions, as the clinical guidelines are to be developed by the Secretary in consultation with stakeholders.

We were persuaded by the commenters that Part D sponsors should have some flexibility in adopting targeting criteria for potential at-risk beneficiaries in order to be able to identify more such beneficiaries, which in turn enables sponsors to be able to do more to address the opioid overuse public health emergency. In addition, flexibility in adopting targeting criteria for potential at-risk beneficiaries is consistent with the current policy, and we wish to be more conservative in varying from that policy for the same reasons. However, we still believe it prudent to place certain parameters around the beneficiaries who may be identified as potentially at-risk by sponsors for their drug management programs, particularly as we gain

experience with the use of lock-in as a drug management tool.

Given that no other commenter recommended a specific program size, there is no discernible consensus that a population of more than 300,000 would be manageable for Part D sponsors. We therefore decline to adopt these criteria as the clinical guidelines for that reason, and also because we want sponsors to focus on the Part D population that is at the highest risk. Also, as we noted previously, the statute requires us to establish policies to ensure that the populations of enrollees in a prescription drug management program can be effectively managed by plans. Therefore, we disagree that the clinical guidelines arbitrarily limit the size of these programs.

After publication of the proposed rule, we conducted an analysis of the clinical guidelines/OMS criteria for 2019 that we proposed using 2017 PDE data, as the original estimates were based on 2015 data. We were pleased to confirm that the current policy, which will be integrated into Part D drug management programs, continues to make substantial progress in reducing potential opioid overutilization in the Part D program. The reduction in the number of beneficiaries meeting the OMS criteria between 2015 and 2017 far outpaced previous trends. We thank the Part D sponsors that have executed the current policy, the providers who have participated, and the various stakeholders who have provided helpful input over the years.

According to this analysis, the 2019 clinical guidelines/OMS criteria we proposed would identify an estimated 11,753 potential at-risk beneficiaries rather than the 33,053 we originally estimated. Given the incremental approach we have taken with the current policy over the years since its inception, this revised estimate provides an opportunity to adjust the clinical guidelines/OMS criteria downward in terms of prescriber and pharmacy thresholds which will incorporate more potential at-risk beneficiaries in 2019.

Therefore, after considering the comments and this updated data, we are doing two things with respect to our clinical guidelines proposal, which we will identify a similar program size as the one we proposed, as well as strike a balance between those commenters wanting complete flexibility to adopt criteria to identify potential at-risk beneficiaries and those urging no flexibility. First, we are finalizing alternative criteria that we considered in the RIA as Option 3 as minimum criteria. These minimum criteria are: Use of opioids with an average daily MME greater than or equal to 90 mg for any duration during the most recent 6 months and either: 3 or more opioid prescribers and 3 or more opioid dispensing pharmacies

OR

5 or more opioid prescribers, regardless of the number of opioid dispensing pharmacies.

This means that beneficiaries meeting these criteria will be reported to sponsors by OMS and sponsors with drug management programs must review each case and report their findings back to OMS as they do today consistent with how they have operated under the current policy. In addition, sponsors may not vary these minimum criteria. However, as we previously stated, sponsors will be permitted to apply the minimum criteria more frequently using their own prescription claims data than CMS will apply them through OMS quarterly. According to our analysis of 2017 PDE data, these minimum criteria would identify 44,332 potential at-risk beneficiaries and is the option based on 90 MME in the RIA that has a revised program size estimate which is closest to our original estimate of 33,053 but that would not identify fewer at-risk beneficiaries. Given the scope of the opioid crisis, and current data showing significant reduction in the number of beneficiaries meeting the OMS criteria, finalizing criteria that would have resulted in a smaller program size could undermine the increasing momentum in addressing opioid overutilization in the Medicare Part D program.

Second, we are finalizing supplemental criteria to provide sponsors with some flexibility in adopting criteria for their drug management programs. This means that sponsors may continue to report additional beneficiaries to OMS—as they do today under the current policy. However, unlike the current policy, such beneficiaries must meet the following supplemental criteria: Use of opioids (regardless of average daily MME) during the most recent 6 months with 7 or more opioid prescribers

OR

7 or more opioid dispensing pharmacies.

These supplemental criteria were included in the additional criteria options that we considered and are included in a options chart in the Regulatory Impact Analysis (RIA) of the proposed rule; specifically, in Row 2 of option 6. Using 2017 data, we estimate that these supplemental criteria would identify an additional 22,841 potential at-risk beneficiaries. We believe these criteria would be responsive to the concern of the commenters who, in urging us to allow flexibility for sponsors to adopt targeting criteria, expressed concerns about not being able to continue to address plan members who are receiving opioids from a large number of prescribers or pharmacies but who do not meet a particular MME threshold.

We note that we do not anticipate that OMS will report beneficiaries meeting these supplemental criteria to sponsors; however, Part D sponsors may review beneficiaries who meet them—and must report them to OMS if they do—at a level that is manageable for their drug management programs in conjunction with the potential at-risk beneficiaries reported by OMS minimum criteria, whom they must address.

Thus, the final clinical guidelines for 2019 will result in an estimated program size of approximately 67,173 beneficiaries—44,332 of whom Part D sponsors with drug management programs must review and 22,841 of whom such sponsors may review. We believe this program size can be effectively managed by plans because we have already received feedback from Part D sponsors through the final 2018 Medicare Parts C&D Call Letter process that 33,000 beneficiaries are manageable. Thus, we conclude that 44,332 beneficiaries are associated with the option included in the RIA of the proposed rule that is the closest in number without identifying fewer potential at-risk beneficiaries and is consistent with historical program size under the current policy. Moreover, we received no comments that 33,053 beneficiaries is the largest program size Part D sponsors can manage. Finally, as we stated above, sponsors may review the additional 22,841 beneficiaries at a level that is manageable for their drug management programs.

These final criteria for 2019 meet the definition of clinical guidelines that we are finalizing. They are criteria to identify potential at-risk beneficiaries who may be determined to be at-risk beneficiaries under drug management programs, and they were developed in accordance with the standards we are finalizing in § 423.153(f)(16) and beginning for 2020, will be published in guidance annually. These criteria also adhere to the standards we proposed in § 423.153(f)(16) because: (1) They were developed with stakeholder consultation in that we solicited comment on them in the proposed rule; (2) they are based on the acquisition of frequently abused drugs from multiple prescribers, multiple pharmacies, and the level of frequently abused drugs in that they identify potential at-risk beneficiaries taking opioids and obtaining them from 7 or more prescribers or 7 or more pharmacies; (3)

they are derived from our and commenters' expert opinion that obtaining opioids from many prescribers or many pharmacies is a potentially dangerous utilization pattern of frequently abused drugs due to an apparent lack of coordination of care that warrants further review and this opinion is supported by the fact that this pattern is highly unusual in the Part D program as it represents 0.11 percent of beneficiaries; and (4) they include a program size estimate.

We have consolidated the clinical guidelines/OMS criteria in Table 1 for easier reference. We note that we were not persuaded by the commenter who urged us to adopt criteria that would address high opioid use regardless of the number of prescribers or pharmacies, as one purpose of drug management programs, and lock-in tools specifically, is to promote better care coordination among multiple providers.

Comment:

Some commenters suggested that if we have concerns with allowing Part D sponsors flexibility in adopting targeting criteria for potential at-risk beneficiaries, that we establish a process through which a sponsor could submit their guidelines to CMS.

Response:

We thank these commenters for their idea, but we prefer the approach we have taken as providing consistency across the entire Part D program and a program size, as required by CARA.

Comment:

A few commenters urged caution in the use of policies determining access to medications based upon thresholds such as MME, which the commenters viewed as a potentially problematic type of one-size-fits all approach. These commenters noted that scientific literature does not support the establishment of a recommended maximum dose for opioids. These commenters also pointed out that the use of such thresholds may result in a false impression of a superior safety profile, which we interpreted to mean that referring to a specific MME level as potentially dangerous may give the impression that a level below that amount is universally safe.

Response:

We agree with the commenter that the CDC Guideline—and our clinical guidelines for Part D drug management programs that refer to it—are not intended as a maximum threshold for prescribing, as we noted in the preamble to the proposed rule. In the absence of dosing limits in the FDA-approved labeling for opioids, we are using the CDC guideline to establish a threshold to identify potentially high-risk beneficiaries who may benefit from closer monitoring and to create alignment between Government programs.

Moreover, our implementation of the CARA drug management program provisions focuses on beneficiaries who are receiving opioids from multiple prescribers and/or multiple pharmacies, not just at a certain MME level. In addition, our finalized requirements for drug management programs require Part D sponsors to engage in case management with prescribers, obtain their verification that the beneficiary is at-risk and their agreement before implementing a prescriber lock-in or beneficiary-specific claim edit, as long as the prescribers are responsive to case management. This means that decisions about the amount of frequently abused drugs an at-risk beneficiary should receive are made by the beneficiary's prescriber(s) if they are responsive and not based on the targeting threshold for review of the beneficiary's utilization. Thus, this approach is aimed at addressing overutilization of frequently abused drugs while maintaining access to such drugs when medically necessary in the Part D program.

Comment:

A commenter proposed modifying “for any duration” in the clinical guidelines to permit beneficiaries a reasonable overlap time to refill medications and suggested that CMS set a reasonable overlap period of no more than 3 days for the purposes of identifying potential at-risk beneficiaries.

Response:

CMS performed an extensive analysis of the OMS criteria using 2015 data (

https://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/Downloads/Revised-OMS-Criteria-Modification-Analysis.pdf

). Adjusting the clinical guideline MME calculation for each beneficiary to account for overlapping fills would be difficult to operationalize from a data analysis perspective since it would be dependent on the number of fills and the opioids dispensed, including strength each beneficiary received. For this reason, CMS chose to calculate the MME daily dose using the average daily dose during the opioid usage. We included “for any duration” in the clinical guidelines since this means that these beneficiaries reached or exceeded the MME level in a short period of time, and received their opioids from multiple prescribers and pharmacies. This indicates potential coordination of care issues or misuse. We found that the number of additional overutilizers with an episode length less than 90 days for any of the MME dose thresholds analyzed ranged from only 57 to 320 beneficiaries, or 1 to 2 percent of the 90+ day episode opioid overutilizer count. Therefore, we included these beneficiaries as potential opioid overutilizers under the current policy, and we will continue to utilize this methodology for OMS reporting of potential at-risk beneficiaries for drug management programs.

If a sponsor performs case management for a potential at-risk beneficiary who was reported through OMS and discovers that the high use was a result of appropriate prescription overlap and not misuse, we would expect the sponsor to stop conducting case management for that beneficiary, and to not send the initial notice to the beneficiary.

Comment:

A commenter requested that CMS clarify that the language “for any duration during the most recent 6 months” means that the opioid use occurred during the most recent 6 months and not 6 months of consistent use.

Response:

We confirm that this language means that the opioid use occurred during the most recent 6 months.

Comment:

A commenter suggested that CMS apply path analysis to develop clinical guidelines to identify potential at-risk beneficiaries using the Integrated Data Repository (IDR), which is a data warehouse that integrates multiple data sources and supports analytics across CMS.

Response:

We thank the commenter for suggesting an approach in the IDR to improve identification of potential at-risk beneficiaries for CMS to consider.

We proposed that under the clinical guidelines, prescribers associated with the same single Tax Identification Number (TIN) be counted as a single prescriber, because we have found under the current policy that such prescribers are typically in the same group practice that is coordinating the care of the patients served by it, and failing to do so would result in a high volume of false positives reported through OMS. Thus, it is appropriate to count such prescribers as one, so as not to identify beneficiaries through OMS who are not potentially at-risk.

In this regard, in applying the clinical guidelines criteria, CMS proposed to count prescribers with the same TIN as one prescriber, unless any of the prescribers are associated with multiple TINs. We also proposed that when a pharmacy has multiple locations that share real-time electronic data, all locations of the pharmacy collectively be treated as one pharmacy under the clinical guidelines. For example, under the criteria we are finalizing, a beneficiary who meets the 90 MME criterion and received opioid

prescriptions from 3 prescribers in the same group practice and 2 independent opioid prescribers (1 group practice + 2 prescribers = 3 prescribers) and filled the prescriptions at 4 opioid dispensing pharmacies that do not share real-time electronic data, will still meet the criteria, which is appropriate. However, a beneficiary who meets that 90 MME criterion and received opioid prescriptions from 3 prescribers in the same group practice and 1 independent opioid prescriber (1 group practice + 1 prescriber = 2 prescribers) and filled the prescriptions at 4 opioid dispensing pharmacies that do not share real-time electronic data will not meet the criteria.

Comment:

Several commenters supported the proposal conceptually to count prescribers associated with the same single TIN as a single prescriber, but many of these commenters noted that some Part D plans sponsors and PBMs do not have access to prescriber TIN information. A few commenters recommended that CMS count prescribers with the same National Provider Identifier (NPI) as a single prescriber, and a commenter suggested that CMS require prescribers to share real-time electronic data through an electronic health record (EHR).

Response:

We appreciate the support for this proposal as well as the information on the operational challenges. After considering these comments, we are finalizing this aspect of the clinical guidelines for 2019. Part D plan sponsors without the ability to group prescribers using the TIN through data analysis will have to make these determinations during case management. If a sponsor finds that the multiple opioid prescribers for the beneficiary are from a single group practice, and therefore, the beneficiary does not meet the clinical guidelines, the sponsor could stop conducting case management for that beneficiary, and would not send the initial notice to the beneficiary. We will issue guidance and updated OMS technical user guides to plan sponsors at a later time, including data sources and standard responses used in OMS reporting, which may include providing such feedback to CMS.

In addition, this information may be discovered after the sponsor provided the beneficiary the initial notice. In such an event, the sponsor would send the beneficiary an alternate second notice that the beneficiary is not at-risk. To the comments about grouping by NPI, we clarify that under the current policy/OMS we use the NPI to first identify single prescribers, and then we further group single prescribers with the same single TIN. We will continue this methodology for the clinical guidelines under the drug management program. We appreciate the comment regarding real-time prescriber data, but we did not propose such a system for Part D prescribers.

Comment:

We received several comments supporting our proposal that when a pharmacy has multiple locations that share real-time electronic data, all locations of the pharmacy collectively be treated as one pharmacy under the clinical guidelines. We also received many comments that Part D plan sponsors and their PBMs do not have the systems capabilities to account for pharmacies that have multiple locations that share real-time electronic data, in order to treat all locations of the pharmacy collectively as one pharmacy. We received one comment that they are able to, but that there are operational challenges to synthesizing the data to be useful for drug management programs.

Response:

As we stated in the proposed rule, section 1860D-4(c)(5)(D) of the Act specifies that for purposes of limiting access to coverage of frequently abused drugs to those obtained from a selected pharmacy, if the pharmacy has multiple locations that share real-time electronic data, all such locations of the pharmacy collectively are treated as one pharmacy. Because of this statutory requirement, it makes sense to us to consider such multiple locations as one pharmacy for purposes of the clinical guidelines, similar to how we account for group practices, to reduce false positives, particularly because the purpose of the guidelines is to identify when a beneficiary may be at risk for overutilization because they use multiple pharmacies. Therefore, we are finalizing this aspect of the clinical guidelines for 2019.

We understand that we, and apparently most sponsors and their PBMs, do not have the systems capability to automatically determine when a pharmacy is part of a chain. Therefore, Part D plan sponsors without this capability will have to make these determinations during case management. If through such case management, a plan sponsor finds that multiple locations of a pharmacy used by the beneficiary share real-time electronic data, the sponsor will be required to treat those locations as one pharmacy. This may result in the sponsor not or no longer conducting case management for a beneficiary because the beneficiary does not meet the clinical guidelines, or in the sponsor sending the beneficiary an alternate second notice that the beneficiary is not at-risk if the sponsor discovers this information after it provided the beneficiary with the initial notice.

We note that group practices and chain pharmacies are discussed later in this preamble in the context of the selection of a prescriber(s) and pharmacy(ies) in cases when a Part D plan limits a beneficiary's access to coverage of frequently abused drugs to selected pharmacy(ies) and/or prescriber(s).

As noted above, Table 1 shows that in 2017 approximately 44,332 beneficiaries would have met the minimum criteria of the 2019 clinical guidelines that we are finalizing, which is approximately 0.10 percent of the 45 million beneficiaries enrolled in Part D in 2017. Approximately, 22,841 additional beneficiaries will have met the supplemental criteria that we are finalizing, which is approximately 0.05 percent. To derive this estimated population of potential at-risk beneficiaries, we analyzed prescription drug event data (PDE) from 2017,

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using the CDC opioid drug list and MME conversion factors, and applying the criteria we are finalizing as the clinical guidelines. This estimate is over-inclusive because we did not exclude beneficiaries in long-term care (LTC) facilities who will be exempted from drug management programs, as we discuss later in this section.

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Unique count of beneficiaries who met the criteria in any 6 month measurement period (January 2017-June 2017; April 2017-September 2017; or July 2017-December 2017).

However, based on similar analyses we have conducted, this exclusion will not result in a noteworthy reduction to our estimate. Also, we were unable to count all locations of a pharmacy that has multiple locations that share real-time electronic data as one, which is a topic we discussed earlier and will return to later. Thus, there likely are beneficiaries counted in our estimate who will not be identified as potential at-risk beneficiaries because they are in an LTC facility or only use multiple locations of a retail chain pharmacy that share real-time electronic data.

ER16AP18.000

As clarified above, since the CDC removed all formulations of buprenorphine, for pain and for MAT, from the most recent CDC MME conversion factor file, buprenorphine products are not used to determine the beneficiary's average daily MME. However, we will use prescription opioids, including all buprenorphine products for pain and MAT, to determine opioid prescribers and opioid dispensing pharmacies under the minimum criteria. Similarly, sponsors must include all prescription opioids, including all buprenorphine products, to determine opioid prescribers and opioid dispensing pharmacies under the supplemental criteria.

• Exempted Beneficiary

We proposed that an exempted beneficiary, with respect to a drug management program, would mean an enrollee who: (1) Has elected to receive hospice care; (2) Is a resident of a long-term care facility, of a facility described in section 1905(d) of the Act, or of another facility for which frequently abused drugs are dispensed for residents through a contract with a single pharmacy; or (3) Has a cancer diagnosis. While the first two exceptions are required under CARA, we proposed to exercise the authority in section 1860D-4(c)(5)(C)(ii)(III) of the Act to treat a beneficiary who has a cancer diagnosis as an exempted individual. We did not propose to exempt additional categories of beneficiaries.

We received the following comments and our response follows:

Comment:

Commenters were overall supportive of our proposal to exempt beneficiaries who have a cancer diagnosis. A few of the commenters noted that the CDC Guideline recommendations do not apply to active cancer treatment. Many of these commenters asked for more guidance on how this exemption, which is a feature of the current policy, would be operationalized. Others felt the exemption is too broad and could be applied to beneficiaries who have not been treated for cancer in years or who are being treated for non-terminal cancer but possibly do have an opioid overuse issue that needs to be addressed. A few commenters disagreed with the exemption as an inappropriate

one-size-fits-all approach. Even the commenters who did not support the exemption noted that the cancer population is unique and must be handled delicately.

Response:

We thank the commenters for their supportive comments as to the exemption for cancer. Our intent is to exempt beneficiaries who are currently being treated for active cancer-related pain from Part D drug management programs and this is the exemption we are finalizing based on the comments. While our current policy generally excludes beneficiaries with cancer diagnoses from OMS reporting,

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we believe it is appropriate to be more specific with respect to regulatory parameters for Part D prescription drug management programs. Therefore, the comments have persuaded us that we need to be more precise with this codified exemption.

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Currently, for OMS, the following beneficiaries are excluded from OMS reporting: Those with ICD-10-CM codes associated with American Medical Association (AMA) Physician Consortium for Performance Improvement (PCPI) ICD-10 cancer diagnoses in the Common Working File (CWF) data during the 12 months prior to the end of the measurement period or cancer RxHCCs in the latest Risk Adjustment Processing System (RAPS). Note, this is currently aligned with the Pharmacy Quality Alliance opioid overuse measure specifications.

As we noted in the proposed rule, there are some limitations around this exemption under the current policy due to our current data sources which will remain when implementing the drug management program clinical guidelines. For example, there may be a lag in current year diagnosis data in CMS systems and the RxHCC codes from the risk adjustment processing system are based on diagnosis data from the past year. Therefore, Part D plan sponsors will have to identify such exempted beneficiaries through the case management process if they are inadvertently reported through OMS or when the sponsor is reviewing cases pursuant to applying the minimum clinical guidelines more frequently than CMS and the supplemental criteria of the clinical guidelines. Plan sponsors may have more recent cancer diagnosis information or learn this information through clinical contact with prescribers. Plan sponsors may currently refer to the CDC Guideline as a reference which distinguishes active cancer treatment from cancer survivors with chronic pain who have completed cancer treatment, are in clinical remission, or are under cancer surveillance only. We will monitor health care guidelines that address this topic and issue guidance as warranted to further refine the execution of the exemption for beneficiaries being treated for active cancer-related pain that we are finalizing.

While we understand the concerns of the commenters who did not support this exemption about potential inappropriate opioid use among this population, we note that this exemption is a feature of the current policy, which has reportedly been working well and we therefore believe it is appropriate to extend it to drug management programs. We agree that this population deserves heightened protection but we are finalizing an exemption that we believe is narrowly tailored to address the concerns of commenters who urged us to proceed with caution with respect to this exemption.

Comment:

Many commenters supported the exemption for beneficiaries in the LTC setting. A few commenters recommended that we not exempt LTC beneficiaries from retrospective drug utilization review (DUR) processes. A commenter asked if it could still implement a beneficiary-specific claim edit at POS for frequently abused drugs if it independently determined an LTC resident to be at-risk.

Response:

Section 1860D-4(c)(5)(C)(ii) exempts beneficiaries in the LTC setting, and we therefore do not have the authority to permit plans to include them in Part D drug management programs. We are finalizing this exemption as proposed. Because beneficiary-specific POS claim edits for frequently abused drugs are included in drug management programs through the integration approach we are finalizing, a sponsor may not implement such an edit for an exempt beneficiary.

However, while exempt beneficiaries are exempt from drug management programs, they are not exempt from retrospective DUR processes. Part D plan sponsors still must comply with its other utilization management obligations in § 423.153, and could implement a beneficiary-specific edit for drugs other than frequently abused drugs, for example, if necessary to comply with those obligations. In addition, sponsors may also still review the use of drugs that constitute frequently abused drugs by beneficiaries in LTC facilities and work with such facilities to identify patterns of inappropriate or medically unnecessary care among enrollees. However, as just stated, the sponsors cannot implement beneficiary-specific edits for drugs that constitute frequently abused drugs, nor prescriber or pharmacy lock-in for such drugs.

Comment:

A commenter requested that CMS exempt any Part D claim submitted by a Network Long-Term Care Pharmacy (NLTCP), as defined in Chapter 5 of the Medicare Prescription Drug Benefit Manual, asserting that such pharmacies are required to meet minimum performance and service criteria, including performing drug utilization reviews and identifying inappropriate drug usage. Another asked for clarification on whether beneficiaries serviced by long-term care pharmacies are exempt or if the exemption is limited to beneficiaries in long-term care facilities.

Response:

Section 1860D-4(c)(5)(C)(ii) of the Act exempts residents of a long-term care facility rather than pharmacy claims submitted by long-term care pharmacies. Therefore, we find it is appropriate to finalize an exemption that takes the same approach as the statute. However, we note that beneficiaries serviced by long-term care pharmacies may meet another exemption, such as the one for beneficiaries residing in facilities for which frequently abused drugs are dispensed for residents through a contract with a single pharmacy.

Comment:

A few commenters stated that they will need the Long-Term Institution (LTI) report to be released on a monthly basis rather than the current quarterly basis.

Response:

We thank the commenters for their comment and will explore if more frequent reporting is feasible.

Comment:

Many commenters supported the proposed exemption for beneficiaries who are residents of a facility for which frequently abused drugs are dispensed for residents through a contract with a single pharmacy. Others urged us to propose one.

Response:

We clarify for commenters that the proposed rule included an exemption for beneficiaries who are residents of a facility for which frequently abused drugs are dispensed for residents through a contract with a single pharmacy, as required by Section 1860D-4(c)(5)(C)(ii). Therefore, we are finalizing this exemption as proposed.

Comment:

Many commenters urged us to extend an exemption to beneficiaries in assisted living facilities, asserting that such beneficiaries are at very low risk of substance abuse and that applying lock-in to them could be disruptive and undermine their care. Other commenters opposed such an exemption and urged us to proceed with caution in carving out multiple exemptions that could undermine the purpose of drug management programs. Other commenters referred to the difficulty in identifying such beneficiaries to exempt them.

Response:

Based on the comments received, we are not persuaded that beneficiaries in assisted living facilities should be exempt from Part D drug management programs, because we do not believe that these facilities routinely dispense drugs to their residents through a contract with a single pharmacy, and therefore these beneficiaries could be identified by the clinical guidelines on this or another basis and be potentially at-risk. However, if a sponsor learned during case management that a beneficiary resides in an assisted living facility that does dispense drugs through a contract with a single pharmacy, then the sponsor must exempt such resident from its drug management program.

In addition, we are persuaded that many exemptions for certain group of beneficiaries or ones that are crafted too broadly would risk undermining the purpose of drug management programs. Therefore, we decline to establish a separate exemption for assisted living facility residents. We note that several required features of Part D drug management programs, such as case management, multiple written beneficiary notices, the right to appeal and our general oversight, will serve as beneficiary safeguards should a Part D sponsor inappropriately limit a beneficiary's coverage to frequently abused drugs through a drug management program.

Comment:

A commenter questioned how a drug management program should handle at-risk beneficiaries who move in and out of an LTC facility.

Response:

An at-risk beneficiary who moves into an LTC facility becomes an individual exempted from a drug management program and a sponsor must remove such beneficiary from such program as soon as it reliably learns that the beneficiary has moved into an LTC facility, whether that be via the beneficiary, the facility, a pharmacy, a prescriber, or an internal or external report. A beneficiary who moves out of an LTC facility is no longer exempted unless he or she meets another prong of the finalized definition of exempted beneficiary.

Comment:

Several commenters suggested that an exemption for beneficiaries who are receiving non-hospice palliative and end-of-life care would be appropriate in light of the exemption for beneficiaries who have elected hospice care. A few of these commenters asserted that without an exemption in the regulation, beneficiaries could be included in a drug management program at a plan sponsor's discretion and experience restricted access to pain-control medication when they need them the most. Some commenters noted that the CDC Guideline exempts patients receiving palliative and end-of-life care. Others disagreed, asserting that we had put sufficient safeguards in place to protect such beneficiaries in drug management programs. Other commenters referred to the difficulty in identifying such beneficiaries in order to exempt them.

Response:

We are persuaded that beneficiaries who are receiving non-hospice palliative and end-of-life care but have not elected hospice should be exempted from Part D drug management programs. While we wish to exercise caution and thoughtfulness in establishing regulatory exemptions versus clinical guidelines/criteria, as we noted above, we agree based on the multiple comments that such beneficiaries should be treated the same as beneficiaries who have elected hospice care for purposes of drug management programs, as they are very similar in their health care status, if not their health benefit plan status. While we expect that Part D plan sponsors and PBMs would not inappropriately place such beneficiaries in their drug management programs, an actual regulatory exemption from drug management programs would be more definitive. Furthermore, adding these exemptions would align the drug management programs with the CDC Guideline, which was developed by experts and specifically provides recommendations for primary care clinicians who are prescribing opioids for chronic pain outside of active cancer treatment, palliative care, and end-of-life care. Therefore for consistency with the CDC Guideline, beneficiaries who are receiving non-hospice palliative and end-of-life care but who have not elected hospice will be exempted from Part D drug management programs as well.

As discussed in the proposed rule, the data challenges to identify these Part D beneficiaries will still exist for CMS and we anticipate for Part D sponsors also. Therefore, we will explore options for refining OMS reporting in this regard, and sponsors will have to identify these exempted beneficiaries through the case management process.

We also remind Part D sponsors that drugs and biologicals covered under the Medicare Part A per-diem payments to a Medicare hospice program are excluded from coverage under Part D. For a prescription drug to be covered under Part D for a beneficiary who has elected hospice, the drug must be for treatment unrelated to the terminal illness or related conditions. This is because drugs and biologicals covered under the Medicare Part A per-diem payments to a Medicare hospice program are excluded from coverage under Part D. Therefore, in 2014,

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we strongly encouraged sponsors to place beneficiary-level PA requirements on only four categories of prescription drugs including analgesics. As a result, a small number of beneficiaries who elected hospice care have been identified and excluded from the current policy/OMS.

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Please see the most recent CMS guidance, “Update on Part D Payment Responsibility for Drugs for Beneficiaries Enrolled in Medicare Hospice”, issued on November 15, 2016.

Comment:

A few commenters requested clarification on the practical meaning of an exempted individual. Specifically, they asked if the beneficiary is exempted from only coverage limitations or from retrospective DUR processes. A commenter opposed our proposal that drug management programs would supersede the current policy in that beneficiary-specific edits would no longer be permitted on non-opioid medications. Another commenter requested clarification on the status of existing beneficiary-specific POS claim edits for opioids and benzodiazepines beginning January 1, 2019.

Response:

Exempted beneficiaries are exempted from Part D drug management programs. Also, because we are integrating the “lock-in” component of the drug management programs with the current policy, going forward, beneficiary-specific POS edits and lock-in for frequently abused drugs will be permitted only in compliance with § 423.153(f). However, as we noted earlier, the prescription drug management program requirements that we are finalizing in this rule do not affect plan sponsors' obligation to comply with other requirements pertaining to coverage or utilization management. Part D plan sponsors are still obligated to conduct other drug utilization review and management consistent with existing DUR requirements, which includes reviewing utilization for any Part D drug and may include implementing beneficiary-specific POS claim edits on drugs that are not frequently abused drugs, if necessary. However, we do not have specific guidance in this area, but we would expect the sponsor to employ the same level of diligence and documentation with respect to beneficiary-level POS claim edits for non-frequently abused drugs that we

require for drug management programs, consistent with current policy.

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See “Supplemental Guidance Related to Improving Drug Utilization Review Controls in Part D,” dated September 6, 2012.

In addition, beneficiaries for whom Part D sponsors have implemented beneficiary-specific POS claim edits for opioids and/or benzodiazepines before January 1, 2019 can continue to be subject to those edits under the current policy after December 31, 2018, which means that they may remain in place unless removed under the current policy. For example, as the result of a coverage determination or appeal.

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To the extent that such a beneficiary is reported through OMS on January 1, 2019 or later to a sponsor with a drug management program, that sponsor must comply with the requirements we are finalizing in this rule.

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Patient Safety Analysis Overutilization Monitoring System User Guide. January 2018.

Comment:

A commenter suggested that CMS develop a process by which additional categories of exempted individuals could be evaluated and added that are evidence-based and involve health care practitioners.

Response:

We will evaluate the implementation of the drug management programs. Based on this experience or new or emerging relevant health care information, we will consider proposing additional exemptions through rulemaking as necessary.

Comment:

A commenter asked how to handle retroactive notifications that would qualify a beneficiary for an exemption.

Response:

As we stated in a previous response with regard to beneficiaries who move into LTC facilities, a sponsor must remove an exempted beneficiary from a drug management program as soon as it reliably learns that the beneficiary is exempt, whether that be via the beneficiary, the facility, a pharmacy, a prescriber, or an internal or external report.

Based on these comments, we are finalizing with modification the following definition for exempted beneficiary: An exempted beneficiary, with respect to a drug management program, will mean an enrollee who: (1) Has elected to receive hospice care or is receiving palliative or end-of-life care; (2) is a resident of a long-term care facility, of a facility described in section 1905(d) of the Act, or of another facility for which frequently abused drugs are dispensed for residents through a contract with a single pharmacy; or (3) is being treated for active cancer-related pain. Given this exemption, CMS will report potential at-risk beneficiaries who meet the minimum criteria of the clinical guidelines to sponsors through the OMS. Currently, we have the ability to exempt beneficiaries in LTC facilities, in hospice, and with active cancer-related pain. Sponsors may have more current data or obtain information through the case management and notification processes to further exempt beneficiaries, including those receiving palliative or end-of-life care.

(ii) Requirements of Drug Management Programs (§§ 423.153, 423.153(f))

As noted previously, we proposed to codify a regulatory framework under which Part D plan sponsors may adopt drug management programs to address overutilization of frequently abused drugs. Therefore, we proposed to amend § 423.153(a) by adding this sentence at the end: “A Part D plan sponsor may establish a drug management program for at-risk beneficiaries enrolled in their prescription drug benefit plans to address overutilization of frequently abused drugs, as described in paragraph (f) of this section,” in accordance with our authority under revised section 1860D-4(c)(5)(A) of the Act.

We also proposed to revise § 423.153 by adding a new paragraph (f) about drug management programs for which the introductory sentence will read: “(f) Drug Management Programs. A drug management program must meet all the following requirements.” Thus, the requirements that a Part D plan sponsor must meet to operate a drug management program will be codified in various provisions under § 423.153(f).

We received the following comments and our response follows:

Comment:

While CMS received many comments that were supportive of drug management programs as a whole, we did not receive comments specific to these provisions.

Response:

We are therefore finalizing as proposed.

(iii) Written Policies & Procedures (§ 423.153(f)(1))

We proposed to require Part D sponsors document their programs in written policies and procedures that are approved by the applicable P&T committee and reviewed and updated as appropriate, which is consistent with the current policy. Also consistent with the current policy, we proposed to require that these policies and procedures address the appropriate credentials of the personnel conducting case management and the necessary and appropriate contents of files for case management. We additionally proposed to require sponsors to monitor information about incoming enrollees who will meet the definition of a potential at-risk and an at-risk beneficiary in proposed § 423.100 and respond to requests from other sponsors for information about potential at-risk and at-risk beneficiaries who recently disenrolled from the sponsor's prescription drug benefit plans.

To codify these requirements, we proposed the written policies and procedures specified at § 423.153(f)(1) (see 82 FR 56510).

We received the following comments and our response follows:

Comment:

We received a comment strongly supportive of the requirements in this provision.

Response:

We thank the commenter for the support.

Comment:

We received a few comments inquiring what credentials are needed for clinical staff who conduct case management. The commenters were concerned that the clinical staff conducting case management be adequately qualified to perform it in terms of education and training. These commenters stated that unqualified case managers could significantly detract from the benefit of Part D drug management programs.

Response:

We agree that the requirement that clinical staff conduct case management needs more detail. CMS expects that such clinical staff conducting case management as part of a Part D plan sponsor's drug management program would be a physician or other appropriate health care professional with sufficient expertise to conduct medical necessity reviews related to potential opioid overutilization. While we are not specifying particular credentials for clinical staff, in response to these comments, we are clarifying in the finalized version of § 423.153(f)(1)(i) that clinical staff must have a current and unrestricted license to practice within the scope of his or her profession in a State, Territory, Commonwealth of the United States (that is, Puerto Rico), or the District of Columbia.

Comment:

We received several comments that a dentist should be required to be included on the case management team when a prescriber of frequently abused drugs is a dentist.

Response:

We decline to adopt this recommendation. We do not want to be overly prescriptive as to the specific background of licensed clinical staff conducting case management. We believe the plan should have some flexibility, beyond what is discussed in the preceding response and described in § 423.153(f)(1)(i), to determine appropriate credentials of the clinical

staff conducting case management based on the facts and circumstances of the case.

Comment:

We received a question asking how prescriber agreement should be documented and shared with appropriate parties. We also received a few comments that a Part D sponsor must ensure that any records of contacts between the sponsors and prescribers under drug management programs must be easily accessible to at-risk beneficiaries who wish to appeal and that these records are easily able to be auto-forwarded to the Independent Review Entity (IRE).

Response:

We agree that such information must be documented and available to appropriate parties including at-risk beneficiaries and the IRE, when applicable. To comply with § 423.153(f)(1)(ii), sponsors must document contact with prescribers during case management, for example, if a prescriber agreed with the plan sponsor to implement a limit on the beneficiary's access to coverage for frequently abused drugs pursuant to § 423.153(f)(4). Also, the sponsor must document if the beneficiary calls the sponsor to provide his or her pharmacy or prescriber preferences for lock-in. To make this clearer, we are adding language to § 423.153(f)(1)(ii) such that the necessary and appropriate contents of files for case management must include documentation of the substance of prescriber and beneficiary contacts.

Comment:

We received a comment that we should require Part D plan sponsors' policies and procedures for clinical contact to include secure identity verification safeguards to protect prescribers from “phishing” communications that attempt to trick prescribers into disclosing patient information.

Response:

We decline to make this a requirement specific to Part D drug management programs. We note that health care providers' offices and Part D sponsors are both covered entities under Health Insurance Portability and Accountability Act of 1996. We also encourage Part D sponsors to have written policies and procedures for their staff who contact providers to proactively identify themselves in a manner that should reasonably satisfy the providers of their identity and for providers to likewise have written practice policies and procedures to reasonably establish the identity of the staff of health benefit plans who contact them and do not proactively establish their identity.

Given these comments and our responses, we are finalizing § 423.153(f)(1) with modification to include the changes regarding the licensure of the clinical staff conducting case management and the required documentation of the substance of prescriber and beneficiary contacts.

(iv) Case Management/Clinical Contact/Prescriber Verification (§ 423.153(f)(2))

To meet the requirements of section 1860D-4(c)(5)(C) and section 1860D-4(c)(5)(B)(i)(II) of the Act, we proposed in a new § 423.153(f)(2) to require Part D sponsors' clinical staff to engage in case management for each potential at-risk beneficiary for the purpose of engaging in clinical contact with the prescribers of frequently abused drugs and verifying whether a potential at-risk beneficiary is an at-risk beneficiary. Specifically, we proposed that a new § 423.153(f)(2) would state that the sponsor's clinical staff must conduct case management for each potential at-risk beneficiary for the purpose of engaging in clinical contact with the prescribers of frequently abused drugs and verifying whether a potential at-risk beneficiary is an at-risk beneficiary. Proposed § 423.153(f)(2)(i) would further state that, except as provided in paragraph (f)(2)(ii) of this section, the sponsor must do all of the following:

• Send written information to the beneficiary's prescribers that the beneficiary meets the clinical guidelines and is a potential at-risk beneficiary;

• Elicit information from the prescribers about any factors in the beneficiary's treatment that are relevant to a determination that the beneficiary is an at-risk beneficiary, including whether prescribed medications are appropriate for the beneficiary's medical conditions or the beneficiary is an exempted beneficiary; and

• In cases where the prescribers have not responded to the inquiry described in (f)(2)(i)(B), make reasonable attempts to communicate telephonically with the prescribers within a reasonable period after sending the written information.

We proposed to add paragraph (ii) to § 423.153(f)(2) that would specify that the exception would be for identification by prior plan. If a beneficiary was identified as a potential at-risk or an at-risk beneficiary by his or her most recent prior plan, and such identification has not been terminated in accordance with paragraph (f)(14) of this section, the sponsor meets the requirements in paragraph (f)(2)(i) of this section, so long as the sponsor obtains case management information from the previous sponsor and such information is still clinically adequate and up to date. This proposal is to avoid unnecessary burden on health care providers when additional case management outreach is not necessary because it has already been performed by a prior Part D sponsors for the beneficiary. We discuss potential at-risk and at-risk beneficiaries who change plans again later in this preamble.

The information that the plan sends to the prescribers and elicits from them is intended to assist a Part D sponsor to understand why the beneficiary meets the clinical guidelines and if a limitation on access to coverage for frequently abuse drugs is warranted for the safety of the beneficiary. Also, sponsors will use this information to choose standardized responses in OMS and provide information to MARx about any plan coverage limitations that the sponsors implement. We will address required reporting to OMS and MARx by sponsors again later.

Our proposed § 423.153(f)(2) used the terms “reasonable attempts” and “reasonable period” rather than specify a required number of attempts or a specific timeframe for plan sponsor to call prescribers. We explained that this was due to the competing priorities of sponsors' diligently addressing opioid overutilization in the Part D program through case management, which may necessitate telephone calls to the prescribers, while being cognizant of the need to be judicious in contacting prescribers telephonically in order to not unnecessarily disrupt their practices. We further stated that we wished to leave flexibility in the regulation text for sponsors to balance these priorities on a case-by-case basis in their drug management programs. However, we note that we proposed a 3 attempts/10 business days requirement for sponsors to conclude that a prescriber is unresponsive to case management in § 423.153(f)(4) discussed later in this section.

We received the following comments and our response follows:

Comment:

We received a comment requesting that a plan sponsor be able to communicate to CMS if no prescriber will verify that the beneficiary is at-risk.

Response:

We plan to expand and modify OMS and the MARx system to accommodate the CARA drug management program provisions we are finalizing here. We will issue additional guidance and technical instructions as needed.

Comment:

We received a comment asking that we recommend that Part D sponsors encourage prescribers during case management to discuss drug management programs with their patients. We also received a request that we issue guidance to plan sponsors directing them to encourage prescribers, as part of the required clinical contact,

to perform a comprehensive substance abuse disorder screening and/or assessment of the patient deemed to be a potential at-risk beneficiary, and if indicated, refer him or her for follow-up treatment with a pain specialist or addiction treatment provider.

Response:

We encourage Part D plan sponsors to undertake both of these suggestions, but decline to require it at this time, as we believe prescribers, in their professional discretion by and large will undertake appropriate adjusted treatment plans with their patients and/or MA-PDs will negotiate such issues with their network providers. We also remind commenters that not all Part D prescription drug plans have network providers.

Comment:

We received some comments that Part D sponsors should not be permitted to telephone prescribers in order to avoid disrupting their practices.

Response:

We decline to adopt this suggestion. The clinical guidelines identify beneficiaries who are potentially at-risk for a serious adverse health event, including death, due to their opioid use and apparent lack of coordinated care. The requirements we are finalizing permit sponsors to escalate the steps they take during case management to engage in clinical contact with the beneficiary's prescribers of frequently abused drugs. We would expect such prescribers to understand such sponsors' attempts to make them aware of important information in this regard that they likely do not know.

Comment:

We received a comment that integrated delivery systems use communication tools other than telephone calls to escalate matters to prescribers and that CMS should allow such systems to use such tools instead.

Response:

Our intent is for Part D sponsors to use the most effective means designed to elicit a prescriber response to case management. Therefore, based on this comment, we are modifying the regulatory language in § 423.153(f)(2)(i)(C).

Comment:

We received a question whether a gaining sponsor must immediately lock-in a new enrollee if the sponsor receives notice from the losing sponsor that the enrollee was locked-in by the losing sponsor.

Response:

No. Part D sponsors are responsible for their own drug management programs. As such, a gaining sponsor is not required to but may do so under certain circumstances as we discuss later in this preamble. Also, we note that with respect to at-risk beneficiaries that are new to a plan, sponsors that do not take any action should be aware that such beneficiaries may later be reported through OMS if they meet the clinical guidelines. Also, we note that pursuant to § 423.153(f)(2)(i), the sponsor must conduct case management for every potential at-risk beneficiary, unless an exception applies.

After considering these comments, we are finalizing the proposed language in § 423.153(f)(2) with the modification described.

(v) Limitations on Access to Coverage for Frequently Abused Drugs (§ 423.153(f)(3))

We proposed to describe all the tools that will be available to sponsors to limit an at-risk beneficiary's access to coverage for frequently abused drugs under a drug management program in § 423.153(f)(3). Our proposal specified that subject to the requirements of paragraph (f)(4) of this section, a Part D plan sponsor may do all of the following:

• Implement a point-of-sale claim edit for frequently abused drugs that is specific to an at-risk beneficiary.

• In accordance with paragraphs (f)(10) and (f)(11) of this section, limit an at-risk beneficiary's access to coverage for frequently abused drugs to those that are—

++ Prescribed for the beneficiary by one or more prescribers;

++ Dispensed to the beneficiary by one or more network pharmacies; or

++ Specified in both paragraphs (f)(3)(ii)(B)(1) and (2) of this section.

Paragraph (iii)(A) will state that if the sponsor implements an edit as specified in paragraph (f)(3)(i) of this section, the sponsor must not cover frequently abused drugs for the beneficiary in excess of the edit, unless the edit is terminated or revised based on a subsequent determination, including a successful appeal. Paragraph (iii)(B) will state that if the sponsor limits the at-risk beneficiary's access to coverage as specified in paragraph (f)(3)(ii) of this section, the sponsor must cover frequently abused drugs for the beneficiary only when they are obtained from the selected pharmacy(ies) and/or prescriber(s), or both, as applicable, (1) in accordance with all other coverage requirements of the beneficiary's prescription drug benefit plan, unless the limit is terminated or revised based on a subsequent determination, including a successful appeal, and (2) except as necessary to provide reasonable access in accordance with paragraph (f)(12) of this section.

We received the following comments and our response follows:

Comment:

We received a question whether a Part D sponsor, under a drug management program, may implement a combination of a beneficiary-specific POS claim edit, prescriber and/or pharmacy lock-in for frequently abused drugs, and whether these limitations may be implemented at different times. Another comment recommended that plan sponsors be permitted to establish a prescriber lock-in concurrently with a beneficiary-specific POS claim edit and not require the plan to contact the prescribers separately for each limitation.

Response:

We acknowledge that there may be cases where a plan may impose one or more coverage limitations for frequently abused drugs simultaneously on an at-risk beneficiary, and at a later time, add new limitations and/or terminate existing ones. Thus, a plan sponsor may choose to implement multiple limitations on access to coverage for frequently abused drugs for an at-risk beneficiary at one time.

For instance, after case management, a plan sponsor may decide to pursue implementation of a POS claim edit, prescriber lock-in, and pharmacy lock-in for an at-risk beneficiary simultaneously because of the circumstances of the particular case. In this instance, prescriber agreement would be necessary to implement the POS edit and the prescriber lock-in.

A plan sponsor may also implement additional coverage limitations over time (for example, start with a beneficiary-level POS edit, subsequently add a prescriber lock-in, and subsequently add a pharmacy lock-in) because the case has not resolved itself as expected after initial case management. We remind plan sponsors that when implementing additional coverage limitations, the plan sponsor must repeat the case management process including prescriber verification, prescriber agreement, if applicable, and notice requirements for each additional limitation, and that such actions would also confer a new 60 day appeal timeframe. We discuss this scenario further in the appeal section of this preamble.

Furthermore, a plan sponsor might also terminate existing limitations on access to coverage over time (for example, an at-risk beneficiary may have a POS edit and pharmacy lock-in and the plan sponsor terminates the pharmacy lock-in and leaves in place the POS edit).

While we are allowing plan sponsors to make such additions/terminations to limitations to access to coverage for frequently abused drugs for an at-risk beneficiary, we recognize that such

changes might be disruptive and/or confusing for the beneficiary, and thus strongly discourage plans from making frequent changes to such limitations for a particular at-risk beneficiary. To minimize such disruption and ensure such actions are taken in the manner contemplated by the statute, we have added a provision at § 423.153(f)(5)(iv) to the regulation text which specifies that, if a plan intends to make changes to the limitations imposed on a beneficiary under their drug management program after the beneficiary has been identified as at-risk, the plan sponsor is required to provide the beneficiary notices under the rules established at § 423.153(f)(5) through (f)(8) and discussed later in this preamble. Additionally, we will closely monitor information submitted by sponsors to CMS in OMS and MARx and complaint data to make sure plans are not inappropriately disrupting beneficiary access to coverage for frequently abused drugs by making frequent changes to the limitations on access to coverage. While we are not currently imposing limitations on how many times the plan can make such changes, we will re-evaluate this policy in the future if it becomes problematic.

In response to this comment, we are finalizing this provision as proposed, except we are modifying § 423.153(f)(3) to state a Part D plan sponsor may do “any or all of the following,” and § 423.153(f)(3)(ii)(C) to simply state “both.” This will make clearer that read as a whole, § 423.153(f)(3) means that a Part D sponsor may use the tool of a beneficiary-specific point-of-sale edit, or prescriber or pharmacy lock-in, or any combination of these three tools to limit an at-risk beneficiary's access to coverage of frequently abused drugs under its drug management program.

(vi) Requirements for Limiting Access to Coverage for Frequently Abused Drugs (§ 423.153(f)(4))

We proposed in § 423.153(f)(4) that before a Part D plan sponsor could limit the access of at-risk beneficiary to coverage for frequently abused drugs, the sponsor would first be required to take certain actions. We proposed in paragraph § 423.153(f)(4)(i)(A) that a sponsor would be required to conduct the case management discussed earlier, which includes clinical contact to determine whether prescribed medications are appropriate for the potential at-risk beneficiary's medical conditions that is required by section 1860D-4(c)(5)(C)(iv) of the Act and prescriber verification that the beneficiary is an at-risk beneficiary in accordance with Section 1860D-4(c)(5)(B)(i)(II).

We also proposed in paragraph § 423.153(f)(4)(i)(B) that the sponsor would be required to obtain the agreement of the prescribers of frequently abused drugs with the limitation, unless the prescribers were not responsive to the required case management. We invited stakeholders to comment on not requiring prescriber agreement to implement pharmacy lock-in.

We further proposed in paragraph § 423.153(f)(4)(i)(C) that the sponsor must first provide notices that complied with § 423.153(f)(5) and (f)(6) to the beneficiary in accordance with section 1860D-4(c)(5)(B)(i)(I) of the Act. We additionally proposed in paragraph § 423.153(f)(4)(ii) that a sponsor has complied with the requirement in § 423.153(f)(2)(i)(C) to make reasonable attempts to communicate telephonically with prescribers with a reasonable period if the prescribers were not responsive after 3 attempts to contact them within 10 business days. Finally, we proposed language in § 423.153(f)(4)(ii) that would provide an exception to the case management requirement in § 423.153(f)(2) in cases when a potential or an at-risk beneficiary was identified as such by the beneficiary's most recent prior prescription drug benefit plan and the sponsor had obtained the case management information from the sponsor and updated it as appropriate. We discussed such cases elsewhere in this section. We also discuss proposed § 423.153(f)(4)(iv) that would have imposed a 6-month delay before a sponsor could implement prescriber lock-in later in this preamble.

We received the following comments and our responses follow:

Comment:

A commenter suggested that we allow a coverage limitation to be put in place through a drug management program if a prescriber requests one to assist in coordinating the care for his or her patient.

Response:

If the beneficiary meets the clinical guidelines/OMS criteria we are finalizing, and a prescriber requests during case management that a coverage limitation be implemented for the beneficiary, the sponsor may implement it in accordance with the requirements we are finalizing for drug management programs in this rule.

Comment:

Many commenters stated that Part D sponsors should not have to seek prescriber agreement to limit at-risk beneficiaries to a pharmacy(ies) for access to coverage for frequently abused drugs. These commenters argued that requiring prescriber agreement for pharmacy lock-in would create additional administrative burden and inefficiencies and thus prevent drug management programs from responding in a timely fashion to potentially dangerous overutilization of frequently abused drugs. These commenters also argued that sponsors of stand-alone Part D plans do not have contracts with most of the prescribers and, therefore, have limited opportunity to have clinical contact with these prescribers. Moreover, many commenters felt it was not appropriate to require that the prescriber agree to pharmacy lock-in when the pharmacy is not required to agree when a sponsor applies prescriber lock-in to an at-risk beneficiary.

Other commenters supported our proposal to require prescriber agreement for pharmacy lock-in. These commenters argued that provider discretion and clinical judgment is appropriate to prevent pharmacy lock-in from being implemented by Part D sponsors inappropriately and impeding legitimate patient access.

Response:

CMS was persuaded by commenters' rationale that requiring prescriber agreement for pharmacy lock-in could undermine one purpose of drug management programs, which is to promptly address potentially dangerous overutilization of frequently abused drugs. While we recognize that prescriber agreement is an essential component of prescriber lock-in, and prescriber agreement is preferred in the case of a beneficiary-specific claim edit for frequently abused drugs, we are now persuaded that prescriber agreement to pharmacy lock-in is not essential, as pharmacy lock-in is primarily about where the drugs are dispensed and not who wrote the prescription or its dosage. Therefore, we are finalizing this provision with this modification. Plan sponsors will not be required to obtain the agreement of the prescribers of frequently abused drugs to implement a pharmacy lock-in. However, we do note that should a prescriber proactively alert the plan sponsor that they do not believe that pharmacy lock-in is appropriate for a particular at-risk beneficiary, we expect the plan sponsor to take such information into consideration.

On the point of prescriber agreement, we also wish to note that it was unclear in some of the statements if the commenters understood that section 1860D-4(c)(5)(C)(iv) and Section 1860D-4(c)(5)(B)(i)(II) of the Act require, respectively, that a Part D sponsor engage in clinical contact with prescribers regarding whether medications are appropriate for a beneficiary's medical condition and to

verify that a beneficiary is at-risk before limiting access to coverage for frequently abused drugs. Thus, eliminating the need to obtain prescriber agreement to a pharmacy lock-in does not eliminate the requirement to comply with § 423.153(f)(2) and (f)(4)(i)(A) with respect to pharmacy lock-in.

Comment:

Several commenters asked CMS to provide additional details about what options Part D plan sponsors would have if a prescriber does not agree to a pharmacy lock-in.

Response:

As mentioned above, we are not finalizing the proposal that sponsors must receive prescriber agreement before placing an at-risk beneficiary in pharmacy lock-in.

Comment:

In general, commenters supported our proposal that a Part D sponsor would have to obtain prescriber agreement before implementing prescriber lock-in or a beneficiary-specific claim edit at POS for frequently abused drugs to limit an at-risk beneficiary's access to coverage for frequently abused drugs, in cases when a prescriber is responsive to case management. These commenters maintained that the prescribers are in the best position to understand the beneficiary's background and know additional relevant considerations.

However, many commenters voiced their recommendation that the Part D sponsor be able to implement prescriber lock-in without obtaining agreement from all prescribers. Several commenters expressed that it would be difficult to get all prescribers to agree to any limitation, and suggested that as long as at least one prescriber of frequently abused drugs agreed to the limitation, sponsors should be able to proceed with a prescriber lock-in. Commenters suggested that plan sponsors will have already coordinated with the prescribers during case management, at which time the sponsor will have confirmed the appropriateness of the medication and verified with a prescriber that the beneficiary is at risk. Thus, these commenters further suggested that obtaining formal approval of the lock-in will only serve to delay initiating the lock-in.

Commenters also raised the point that a given prescriber may be contributing to the overutilization, in which case his or her approval may not be obtained and requested clarification how a sponsor should act in a beneficiary's best interest if prescribers disagree with each other about the implementation of a claim edit or lock-in. Some commenters recommended that CMS require approval only from the primary prescriber of frequently abused drugs, as determined by case management.

Response:

We agree that in order for drug management programs to operate effectively, and prevent the resource-intensive process of obtaining agreement from multiple prescribers, a Part D sponsor should not have to obtain the agreement to prescriber lock-in of all the at-risk beneficiary's prescribers of frequently abused drugs. Therefore, we are changing the language of § 423.153(f)(4)(i)(B) to refer to at least one prescriber, which means that only one prescriber has to agree to prescriber lock-in or a beneficiary-specific POS edit.

In addition, we believe the language of § 423.153(f)(4)(ii)(B) needs to be clearer that prescribers must be responsive in the case of a prescriber lock-in, meaning that non-responsive prescribers cannot constitute agreement as they can in the case of a beneficiary-specific POS edit. Therefore, we are finalizing the § 423.153(f)(4) with this modification in paragraph (ii)(A) and a new (B).

Comment:

We received a comment suggesting that a better approach to prescriber agreement would be for at-risk beneficiaries to identify a primary prescriber to help drug management and increase beneficiary safety.

Response:

As noted above, we have modified our proposal and are finalizing that all prescribers do not have to agree to prescriber lock-in in order for a plan to implement prescriber lock-in for an at-risk beneficiary; rather, at least one prescriber has to agree. However, we believe that the prescriber who agrees to prescriber lock-in for a beneficiary should be identified through the plan sponsor as a result of case management, and not the at-risk beneficiary. There may be a conflict of interest in having an at-risk beneficiary select whom they consider to be their “primary” prescriber for purposes of prescriber agreement, given they might be motivated to select a “primary” prescriber that they feel would not agree to prescriber lock-in, such that they can continue receiving inappropriate amounts of frequently abused drugs. We reiterate that the requirement that at least one prescriber agree is for agreement to lock-in is different from the beneficiary's preferences for the prescriber to which they will be locked into, which we discuss later in this preamble.

Comment:

We received comments that a prescriber should be able to agree, disagree or neither agree nor disagree with a limitation on a beneficiary's access to coverage for frequently abused drugs.

Response:

A prescriber is of course free to have any of these reactions to case management. A plan sponsor cannot implement prescriber lock-in for the beneficiary, unless at least one prescriber agrees to prescriber lock-in, as discussed earlier. Typically, we would expect the one prescriber to agree to prescriber lock-in and agree to serve as the prescriber. A sponsor cannot lock-in a beneficiary to a prescriber who disagrees, unless the prescriber changes their mind, which must be documented in the case file.

We foresee a situation when a prescriber initially disagrees with prescriber lock-in and asserts that he or she must be able to continue to prescribe frequently abused drugs for the beneficiary. In such a case, if another prescriber has agreed to serve as the prescriber to which the beneficiary is locked into, a plan sponsor may need to again ask the first prescriber if he or she would agree to be a prescriber the beneficiary is locked into, and the beneficiary is ultimately locked into two prescribers to ensure reasonable access pursuant to § 423.153(f)(12), which we discuss further below. This could happen, for example, when a beneficiary has been obtaining opioids from multiple prescribers and benzodiazepines from one psychiatrist. A sponsor may have to permit an at-risk beneficiary to obtain opioids from the prescriber who agreed to the lock-in limitation and benzodiazepines from the psychiatrist, who initially did not agree to prescriber lock-in, but ultimately does agree to serve that beneficiary in a lock-in capacity.

With respect to a beneficiary-specific POS claim edit for frequently abused drugs, however, a plan sponsor may not implement one at a dosage that is lower than the highest dosage a prescriber asserts is medically necessary, which is consistent with our current policy.

13

13

Supplemental Guidance Related to Improving Drug Utilization Review Controls in Part D, September 6, 2012.

If a prescriber neither agrees nor disagrees with a limitation on access to coverage for frequently abused drugs, such a prescriber may be considered by the sponsor to be non-responsive, and an at-risk beneficiary could not be locked into that prescriber.

Comment:

We received a comment suggesting that 30 days be the time period during which a Part D sponsors must attempt to reach an unresponsive prescriber.

Response:

We believe 30 days is too long considering that drug management programs involve frequently abused drugs and multiple prescribers and

pharmacies; that the clinical guidelines identify beneficiaries who are at potentially at high risk for an adverse health event due to the amount of such drugs they are taking; and that there is an apparent lack of coordinated care.

Comment:

We received a comment that a sponsor should only be required to attempt to reach a prescriber twice in 10 business days rather than 3 times in order to establish that the prescriber is unresponsive.

Response:

We decline to make this change as this is our current policy and we received minimal comment on this proposed requirement. The purpose of the policy is to ensure that sponsors have diligently tried to involve prescribers in the case management process.

We wish to note that we believe the language we proposed in § 423.153(f)(4)(iii) which provides an exception to case management is duplicative of the language we discussed above that we are finalizing in § 423.153(f)(2)(ii). Therefore, we are deleting the language in § 423.153(f)(4)(iii).

Given the foregoing, we are finalizing § 423.153(f)(4) with modification, including ones to assist the reader in more easily understanding the cross-references.

We will also state in paragraph (ii)(A) that, except as provided in paragraph (ii)(B) which regards a prescriber limitation, if the sponsor complied with the requirement of paragraph (f)(2)(i)(C) of this section about attempts to reach prescribers, and the prescribers were not responsive after 3 attempts by the sponsor to contact them within 10 business days, then the sponsor has met the requirement of paragraph (f)(4)(i)(B) of this section which regards eliciting information from the prescribers. Paragraph (i)(B) will state that the sponsor may not implement a prescriber limitation pursuant to § 423.153(f)(3)(ii)(A) if no prescriber was responsive.

(vii) Beneficiary Notices and Limitation of Special Enrollment Period (§§ 423.153(f)(5), 423.153(f)(6), 423.153(f)(7), 423.153(f)(8), 423.38)

(A) Initial Notice to Beneficiary and Sponsor Intent To Implement Limitation on Access to Coverage for Frequently Abused Drugs (§ 423.153(f)(5))

The notices referred to in proposed § 423.153(f)(4)(i)(C) are the initial and second notice that section 1860D-4(c)(5)(B)(i)(I) of the Act requires Part D sponsors to send to potential at-risk and at-risk beneficiaries regarding their drug management programs.

We proposed in § 423.153(f)(5) that if a Part D plan sponsor intends to limit the access of a potential at-risk beneficiary to coverage for frequently abused drugs, the sponsor will be required to provide an initial written notice to the potential at-risk beneficiary. We also proposed that the language be approved by the Secretary and be in a readable and understandable form that contains the language required by section 1860D-4(c)(5)(B)(ii) of the Act, as well as additional detail specified in the proposed regulation text.

In proposed paragraph (f)(5)(ii)(C)(2)—which will require a description of public health resources that are designed to address prescription drug abuse—we proposed to require that the notice contain information on how to access such services. We also included a reference in proposed paragraph (ii)(C)(4) to the fact that a beneficiary will have 30 days to provide information to the sponsor, which is a timeframe we discuss later in this preamble. We proposed an additional requirement in paragraph (ii)(C)(5) that the sponsor include the limitation the sponsor intends to place on the beneficiary's access to coverage for frequently abused drugs, the timeframe for the sponsor's decision, and, if applicable, any limitation on the availability of the SEP. Finally, we proposed a requirement in paragraph (ii)(C)(8) that the notice contain other content that CMS determines is necessary for the beneficiary to understand the information required in the initial notice.

We noted that our proposed implementation of the statutory requirements for the initial notice will permit the notice also to be used when the sponsor intends to implement a beneficiary-specific POS claim edit for frequently abused drugs.

Although section 1860D-4(c)(5) is silent as to the sequence of the steps of clinical contact, prescriber verification, and the initial notice, we proposed to implement these requirements such that they will occur in the following order: first, the plan sponsor will conduct the case management which encompasses clinical contact and prescriber verification required by § 423.153(f)(2) and obtain prescriber agreement if required by § 423.153(f)(4), and subsequently, if applicable, the plan sponsor will provide the initial notice indicating the sponsor's intent to limit the beneficiary's access to frequently abused drugs. Further, under our proposal, although the proposed regulatory text of (f)(4)(i) states that the sponsor must verify with the prescriber(s) that the beneficiary is an at-risk beneficiary in accordance with the applicable statutory language, the beneficiary will still be a potential at-risk beneficiary from the sponsor's perspective when the sponsor provides the beneficiary the initial notice. This is because the sponsor has yet to solicit information from the beneficiary about his or her use of frequently abused drugs, and such information may have a bearing on whether a sponsor identifies a potential at-risk beneficiary as an at-risk beneficiary.

Moreover, we proposed that a sponsor should not send a potential at-risk beneficiary an initial notice until after the sponsor has been in contact with the beneficiary's prescribers of frequently abused drugs as part of case management, so as to avoid unnecessarily alarming the beneficiary. This is because the result of case management may be that the sponsors takes a “wait and see” approach to observe if the prescribers adjust their management of, and opioid prescriptions they are writing for, the beneficiary. We noted that while this approach is acceptable, we still expect sponsors to address the most egregious cases of apparent opioid overutilization without unreasonable delay.

Under our proposed approach, a sponsor will provide an initial notice to a potential at-risk beneficiary if the sponsor intends to limit the beneficiary's access to coverage for frequently abused drugs, and the sponsor will provide a second notice to an at-risk beneficiary when it actually imposes a limit on the beneficiary's access to coverage for frequently abused drugs. Alternatively, the sponsor will provide an alternate second notice if it decides not to limit the beneficiary's access to coverage for frequently abused drugs. The second notice and alternate second notice are discussed later in this final rule.

Finally, we proposed to require at § 423.153(f)(5)(iii) that the Part D plan sponsor make reasonable efforts to provide the beneficiary's prescriber(s) of frequently abused drugs with a copy of the notice required under paragraph (f)(5)(i).

We received the following comments related to the initial notice, and general comments applicable to all the proposed notices, and our responses follow:

Comment:

We received many comments related to our proposal to require written beneficiary notice both when a plan identifies the beneficiary as potentially at risk for prescription drug abuse, and again when the plan determines the beneficiary is at risk and implements a beneficiary-level POS edit

and/or a pharmacy or prescriber lock-in for frequently abused drugs. Some commenters disagreed with our proposal to require two notices, stating that a second notice would be unnecessary, confusing, or overly burdensome.

Several other commenters strongly supported our proposal to require the two notifications, including the proposed change to the existing OMS process that would require the initial and second notices before a plan imposes a beneficiary-specific edit at POS. Commenters stated that requiring multiple notices will increase the likelihood that affected beneficiaries will be notified of their status and aware of how they could dispute it. A commenter wanted CMS to require more than two notices, because CMS did not propose to require acknowledgement of receipt from the beneficiary.

Response:

We thank those commenters who agreed with our proposals to require two notices and to integrate existing OMS process into a uniform process for all drug management program restrictions. While we appreciate the concerns expressed by commenters who do not agree with our proposal, as we noted in the proposed rule, the statute at § 1860D-4(c)(5)(B) clearly requires written beneficiary notification both upon identification as a potential at-risk beneficiary and again when the plan determines the beneficiary is at risk. We do not agree that additional notices beyond what we proposed should be required, as it would be overly burdensome on plans and provide little value to beneficiaries.

Comment:

Several commenters asked if stakeholders will have an opportunity to comment on the beneficiary notices and for more information on whether they can be modified by plans and when they will be released. A commenter requested that CMS conduct focus-group testing with beneficiaries to ensure the notice is understandable.

Response:

As discussed in section III.B.14 of this final rule, these notices are subject to approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501

et seq.

). The notices will be posted in the

Federal Register

to give stakeholders an opportunity to review and comment before final versions of the notices are posted. CMS will consider testing through beneficiary focus groups, time permitting. The notices and accompanying instructions will contain detailed information about permissible modifications by plans. CMS intends to release the notices with sufficient time for plan sponsors to implement them into their drug management programs.

Comment:

We received some comments related to requirements to translate these beneficiary notices. Some of the commenters stated that these notices should be designated to be among materials subject to translation requirements in proposed §§ 422.2268 and 423.2268. A commenter asked for clarification on whether plans are required to include section 1557 taglines with these notices.

Response:

While CMS is still developing instructions related to translation requirements to provide guidance on the requirements at §§ 422.2268 and 423.2268, we note that, 423.128(d)(1)(iii) requires Part D plan sponsors' call centers to have interpreter services available to call center personnel to answer questions from limited-English proficient beneficiaries. These obligations are based on Medicare regulations and other civil rights laws, such as Title VI of the Civil Rights Act of 1964, that apply to Medicare health and drug plans. Applicability of Section 1557, and the scope of requirements for access for limited English proficient beneficiaries, and what is a significant communication are determined by the Office for Civil Rights (OCR).

Comment:

A commenter urged CMS to consider implementing additional requirements for beneficiary notification, including establishing requirements stipulating information that must be written on envelopes containing written notices, adding requirements for telephonic or email notification in addition to written notices, and requirements for prescribers to contact beneficiaries to confirm receipt of the required notices.

Response:

We agree with the commenter that detailed beneficiary notification is important, both upon identification as a potential at-risk beneficiary and again either confirming the at-risk identification or that the plan has determined the beneficiary is not at-risk. However, we disagree with this commenter that additional notice requirements are necessary or advisable. We believe it would be overly burdensome to require plans to include specific information on the outside of mailing envelopes and there is no such precedent for similar beneficiary notices in the Part D program, such as notices of coverage denials or transition letters. While CMS expects that prescribers of frequently abused drugs will communicate regularly with their patients, we do not believe it is necessary to require prescribers to confirm that beneficiaries received the required plan notices. Finally, we note that, while CMS does not require telephonic or email notification in addition to the required written notices, plans are not precluded from doing so.

Comment:

A commenter asked why CMS proposed to require that the initial notice contain contact information for other organizations that can provide assistance to beneficiaries regarding the sponsor's drug management program.

Response:

Such information is statutorily required under § 1860D-4(c)(5)(B)(ii)(VII) to be included in the initial notice. As specified in the statute, it should be similar to the information provided in other standardized Part D beneficiary notices. We expect the notice may include, for example, contact information for the enrollee's State Health Insurance Program (SHIP), 1-800-MEDICARE, the Medicare Rights Center, and/or other organizations as appropriate.

Comment:

We received some comments that supported our proposal to require plan sponsors to make reasonable efforts to provide copies of notices to the potentially at-risk and at-risk beneficiary's prescriber(s).

Response:

We thank these commenters for their support.

Comment:

A few commenters opined that Part D plan sponsors and third party administrators do not have access to a list of all State and Federal public health resources designed to address prescription drug abuse. These commenters stated that requiring plans operating in multiple states to compile such a list would be overly burdensome, and requested that CMS provide templates containing such information as required under proposed § 423.153(f)(5)(ii)(C)(

2

). Another commenter asked if MA-PD plans will be allowed to include information about plan-specific mental health benefits in addition to State and Federal resources.

Response:

CMS appreciates the input provided by these commenters. While the notice templates and instructions are still under development, CMS expects to provide information on Federal and State public health resources to assist plans in meeting the statutory requirement at § 1860D-4(c)(5)(B)(ii)(II) to include such information in the initial notice. Under the existing regulations at § 423.505(i), Part D plan sponsors are ultimately responsible for adhering to all terms and conditions of their contract with CMS, including compliance with all Federal laws, regulations and CMS instructions related to activities or responsibilities delegated to a third party. Pursuant to the regulation at § 423.153(f)(5)(ii)(C)(

2

), which we are finalizing as proposed, plans will be also required to include

information about relevant benefits and services covered by the plan, such as medical, mental health and MAT benefits.

Comment:

Some commenters stated that CMS should specify in regulation text that initial notices must not be sent to potential at-risk beneficiaries until the plan has communicated with and received clinical information from the beneficiary's prescribers. These commenters noted that failure to conduct case management prior to sending the initial notice would interfere with doctor-patient relationships and unnecessarily alarm beneficiaries who may be determined not to be at-risk.

Response:

We agree with these commenters that initial notices should not be sent to beneficiaries before the plan has engaged in case management and attempted to communicate with the beneficiary's prescriber(s), and this is specified in the regulation text at § 423.153(f)(2)(i). However, we know from experience with the OMS process that prescribers are not always responsive to the plan's attempts to make clinical contact; therefore, we proposed at § 423.153(f)(2)(i)(C) that plans must make additional attempts to contact such prescribers. Additionally, we proposed at § 423.153(f)(4) that plans cannot limit access to frequently abused drugs unless the plan has conducted case management and obtained agreement from prescribers (or made certain attempts to contact prescribers). We believe this approach strikes an appropriate balance between ensuring sufficient access to frequently abused drugs and protecting at-risk beneficiaries from potential harm in the absence of improved care coordination.

After consideration of the comments received on this section, we are finalizing our proposal with modification to clearly codify the policy that a sponsor should not provide the initial notice to the beneficiary until after the sponsor has engaged in the required case management by adding the phrase “after conducting the case management required by § 423.153(f)(2)” at the beginning of § 423.153(f)(5)(i).

(B) Limitation on the Special Enrollment Period for LIS Beneficiaries With an At-Risk Status (§ 423.38)

Section 704(a)(3) of CARA gave the Secretary the discretion to limit the SEP for full benefit dually eligible (FBDE) beneficiaries outlined in section 1860D-1(b)(3)(D) of the Act. In addition to providing relevant information to a potential at-risk beneficiary, we proposed that the initial notice will notify dually- and other low income subsidy (LIS)-eligible beneficiaries that they would be unable to use the special enrollment period (SEP) for LIS beneficiaries due to their potential at-risk status. (Hereafter, this SEP is referred to as the “duals' SEP”). This limitation is related to, but distinct from, other changes to the duals' SEP discussed in the proposed rule.

We proposed that once a dually- or other LIS-eligible individual is identified as a potential at-risk beneficiary, and the sponsor intends to limit the beneficiary's access to coverage for frequently abused drugs, the sponsor will provide an initial notice to the beneficiary and the duals' SEP would no longer be available to the otherwise eligible individual. This means that he or she would be unable to use the duals' SEP to enroll in a different plan or disenroll from the current Part D plan. The limitation would be effective as of the date the Part D plan sponsor identifies an individual to be potentially at-risk.

We proposed that, consistent with the timeframes discussed in proposed paragraph § 423.153(f)(7), if the Part D plan sponsor takes no additional action to identify the individual as an at-risk beneficiary within 90 days from the initial notice, the “potentially at-risk” designation and the duals' SEP limitation would expire. If the sponsor determines that the potential at-risk beneficiary is an at-risk beneficiary, the duals' SEP would not be available to that beneficiary until the date the beneficiary's at-risk status is terminated based on a subsequent determination, including a successful appeal, or at the end of a 12-month period calculated from the effective date of the limitation, as specified in the second notice provided under § 423.153(f)(6), whichever is sooner.

We noted that auto- and facilitated enrollment of LIS eligible individuals and plan annual reassignment processes would still apply to dual- and other LIS-eligible individuals who were identified as an at-risk beneficiary in their previous plan. Furthermore, we noted that the proposed enrollment limitations for Medicaid or other LIS-eligible individuals designated as at-risk beneficiaries would not apply to other Part D enrollment periods, including the AEP or other SEPs, including when an individual has a gain, loss, or change in Medicaid or LIS eligibility. We proposed that the ability to use the duals' SEP would not be permissible once the individual is enrolled in a plan that has identified him or her as a potential at-risk beneficiary or at-risk beneficiary under § 423.100 of this final rule. (See section II.A.10 for a more detailed discussion of Part D SEP changes.)

We received the following comments and our response follows:

Comment:

We received many comments supporting the limitation of the duals' SEP for those individuals identified as potential at-risk or at-risk for overutilizing frequently abused drugs. Comme

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