Association for Public Policy Analysis & Management

Research Objective: To describe point-of-sale prices and cost-sharing arrangements for orally-administered anticancer drugs offered on Medicare Part D plans from 2010 through 2018. We also estimated the drug-specific proportion of plans and enrollees who have access to favorable cost-sharing arrangements (e.g., copayments instead of coinsurance) in 2018. We hypothesized that 1) product-specific prices will increase over the study period in excess of inflation; and 2) coverage for branded specialty drugs under Medicare Part D plans will shift to greater use of coinsurance (over copayments) over the study period.

Study Design: Cross-sectional study of Medicare Part D formulary files from Q4 2010 through Q4 2018.

Population Studied: Prescription Drug Plan Formulary, Pharmacy Network, and Pricing Information Files available from the Centers for Medicare and Medicaid Services. These files provide detailed prescription drug coverage and cost sharing information for all Medicare Part D formularies, including stand-alone and Medicare Advantage plans, including drug-specific point-of-sale prices (excluding rebates and discounts) and plan cost sharing structure for each quarter. We described medical inflation-adjusted point-of-sale prices for a 30-day or typical supply for each oral anticancer drug from Q4 2010 through Q4 2018 and plan cost sharing structure (use of copayments versus coinsurance) across products and plans in 2018.

Principal Findings: By Q4 2018 there were 54 orally-administered anticancer drugs offered on and reimbursed by Part D plans. Across all drugs and varying years of approval (pre-2010 through 2018), mean prices rose by 5.8% per year above inflation. The mean price per fill in 2010 was $7,438 vs $13,992 in 2018. Average annual spending across products exceeded $160,000. Approximately 98% of plans required coinsurance before the coverage gap across all branded orally-administered anticancer drugs in 2018, with a median coinsurance of 33%.

Despite efforts to close the coverage gap between 2010 and 2018, mean out-of-pocket spending in 2018 increased for 12 of 13 orally-administered anticancer drugs available in both years (mean 12-month out-of-pocket spending in 2010 ($8,794) and 2018 ($10,470), mean increase $1,676).

Conclusions: The number of specialty drugs covered under Part D has increased substantially in the last decade. For adults aged 65 and older, Medicare Part D provides critical access to prescribed drugs. However, beneficiaries have virtually no way to avoid high out-of-pocket spending for specialty drugs, since nearly all plans used coinsurance benefit designs. Furthermore, any savings expected through closing the coverage gap have been erased by price increases for these products. Combined, this suggests that anticancer therapies remain unaffordable for Medicare beneficiaries, particularly those requiring monthly and chronic use of these high-priced drugs.