• CMS evaluates the sufficiency of a Part D sponsor’s formulary categories and classes in
conjunction with the formulary drug list to ensure that the formulary provides access to
an acceptable range of Part D drug choices.
• Consistent with 42 CFR §423.120(b)(2)(i), each formulary is reviewed for inclusion of at
least two Part D drugs for each category and class submitted on the formulary file
(except as noted in §423.120(b)(ii)).
• CMS will review tier placement to ensure that the formulary does not substantially
discourage enrollment of certain beneficiaries. When developing their formulary tier
structure, sponsors should utilize standard industry practices. Tier 1 should be considered
the lowest cost-sharing tier available to beneficiaries. Any subsequent tiers within the
formulary structure will be higher cost-sharing tiers in ascending order, except that plans
may assign a low cost share to Tier 5 or 6 when assigned as a Select Care tier. For
example, drugs in Tier 3 will have a higher cost-share for beneficiaries than drugs in Tier
2. Best practices in existing formularies and preferred drug lists generally place drugs in
a less preferable position only when drugs that are therapeutically similar (i.e., drugs that
provide similar treatment outcomes) are in more preferable positions on the formulary.
The CMS review will focus on identifying drug categories that may substantially
discourage enrollment of certain beneficiaries by placing drugs in non-preferred tiers in
the absence of commonly used therapeutically similar drugs in more preferred positions.
• CMS will analyze formularies to determine whether appropriate access is afforded to
drugs or drug classes addressed in widely accepted treatment guidelines which are
indicative of general best practice. Examples of these may include asthma, diabetes,
chronic stable angina, atrial fibrillation, heart failure, thrombosis, lipid disorders,
hypertension, chronic obstructive pulmonary disease, dementia, depression, bipolar
disorder, schizophrenia, benign prostatic hyperplasia, osteoporosis, migraine,
gastroesophageal reflux disease, epilepsy, Parkinson’s disease, end stage renal disease,
hepatitis, tuberculosis, community acquired pneumonia, rheumatoid arthritis, multiple
sclerosis and HIV. Part D sponsors should be aware of treatment guidelines impacting
those enrollees residing in LTC facilities, such as CDC’s annual Morbidity and Mortality
Weekly Report (MMWR) on prevention and control of influenza. This list of conditions
does not represent an exhaustive list, but merely serves as another check in the review
process.
• CMS will analyze the availability of the most commonly prescribed drug classes for the
Medicare population (Appendix D). This list is derived from Part D claims data. The
drugs identified will be expanded to the class level and used in the formulary review
process. CMS understands that sponsors will not provide identical coverage of these
drug classes, and CMS’ review will focus on ensuring that sponsors present a balanced
formulary. These drug classes will cover common diseases and conditions, and will
allow CMS to ensure that sponsors are covering the most widely used medications, or
therapeutically similar medications, for the most common conditions.