Medicare Part D Applications Submitted; NCPA Plans National PDP

The National Community Pharmacists Association has submitted an application to sponsor a national Medicare prescription drug plan that builds on the unique profile of its drug discount card.

Part D plan sponsors were required to submit applications to the Centers for Medicare & Medicaid Services by March 23; as of March 25, at least 11 companies had announced their intent to sponsor PDPs (see chart: " ¹ Medicare Part D Plans ").

CMS is not going to publish a list of PDP sponsors until they have been approved; however, the agency will publish contact information for plan sponsors that voluntarily submit it to facilitate negotiations with potential contractors. Depending on the level of responses it receives, CMS plans to post the first listings by April 1.

NCPA's plan will be sponsored by Community Care Rx, the subsidiary of the trade association that sponsored its drug discount card. CCRx is teaming up with its card partners, the pharmacy benefit manager Member Health and the information technology firm Computer Sciences Corporation.

In announcing its intent to sponsor a PDP, CCRx touted its card program membership, noting that more than 300,000 Medicare beneficiaries have enrolled since June, when the program began.

As of December, CMS said 5.8 mil. beneficiaries had enrolled in the card program; Medco appeared to have picked up the most beneficiaries, with 779,000 enrolled in its programs as of November (² (Also see "Medicare Rx Card: All Sponsors Return For 2005 Run-Up To Part D Benefit" - Pink Sheet, 6 Dec, 2004.), p. 29).

CCRx's discount card is one of three programs specifically designated to service long-term care pharmacies and their facilities; its experience with that population may give CCRx a competitive advantage.

CMS is advising PDP sponsors that it will carefully review how plans intend to handle the transition of long-term care beneficiaries into Part D.

As with its card program, CCRx said it will not be offering the option of mail order prescriptions to beneficiaries enrolled in its PDP.

NCPA does not appear to be alone in its perception that mail order will play a smaller role in the Part D market than it does in the private sector.

Ovations' selection of Walgreens as its Medicare PDP administrator over the larger PBMs such as Medco seems to imply that health plans are also placing a higher value on retail presence than mail order in Part D (³ (Also see "Ovations/Walgreens Deal Reflects Importance Of Retail In Medicare Part D" - Pink Sheet, 21 Mar, 2005.), p. 26).

Universal American Financial Corporation and CVS announced a similar agreement March 23; the health plan is sponsoring a PDP "in a minimum of 21 regions encompassing 29 states" that will be administered by the retail chain's PBM PharmaCare.

In announcing the deal, Universal American highlighted CVS' retail presence as an essential component of its marketing plans for the PDP. "Our ability to market products through CVS...will greatly augment the program's exposure," the plan said.

CMS is expected to release guidance on PDP marketing regulations soon. NCPA said it does not expect the regulations to be more restrictive than the card program regulations.

HHS' Office of Inspector General issued guidance stating that card sponsor payments to pharmacies for enrolling beneficiaries, or steering them towards a particular card, could violate the federal anti-kickback statute (⁴ (Also see "Medicare Rx Card Marketing Payments To Pharmacies May Be Kickbacks" - Pink Sheet, 19 Apr, 2004.), p. 26).