Yesterday, CMS released FAQs About Affordable Care Act Implementation Part 61, which includes updates related to the three MRF requirements from Transparency in Coverage (TiC). The Part 61 FAQs end the enforcement deferral period for the prescription drug MRF. An enforcement date has yet to be announced.
As background, TiC was written with not two, but three MRF requirements:
- In-Network Rate File: rates for all covered items and services between the plan or issuer and in-network providers.
- Allowed Amount File: allowed amounts for, and billed charges from, out-of-network providers.
- Prescription Drugs File: negotiated rate and historical net price.
If you didn’t know that third file existed or you haven’t seen it out in the wild, that’s because FAQs released in August, 2021 included CMS’ decision to defer enforcement of the prescription drugs file. The remaining two files were required to be publicly available as of 7/1/2022.
Part B injectable drugs are included in hospital MRFs because hospital files must be built on all items and services within a hospital’s CDM. Using innovative technical wizardry, Turquoise has been able to glean insights and per unit pricing from those hospital MRFs. The addition of a payer-created file specifically dedicated to prescription drugs furthers that progress tenfold for a number of reasons:
- It opens the door to compare and match rates between hospital and payer files, which adds a valuable layer of validation and confidence for data users.
- It prepares numerous stakeholders for the upcoming rounds of drug negotiations through the Inflation Reduction Act. While the first two negotiation rounds focus specifically on Part D drugs, round three will contain Part B drugs. The calculation of the Maximum Fair Price (MFP) is complex and we anticipate will be heavily scrutinized in the negotiations process, so having public data showing negotiated rates and historical net price lays some common ground for fair rate assessment.
- Without publicly available negotiated rates, patients are left unable to get comprehensive pre-appointment estimates. The lack of complete drug negotiated rates has left a gap in accurate estimate creation. With the new drug data in hand, great strides can be made toward good faith estimates and advanced explanations of benefits, which leads to increased education and decision-making abilities for patients.
The timing of yesterday’s FAQs confirm what the broader legislative landscape has been saying for the past few months: drug prices are opaque, complex, and causing a lot of anxiety, and the government is holding numerous stakeholders accountable for being part of the solution to bring about clarity and simplification. In addition to the Inflation Reduction Act, the Hospital Final Rule, and now Transparency in Coverage, The Lower Costs, More Transparency Act bill draft contains robust reporting requirements for Pharmacy Benefit Managers.
This is another momentum-shifting week in the world of price transparency, and once again, we celebrate the progress that has been made.
Curious to learn more about the new prescription drug MRFs? Drop us a line anytime!