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Role of P&T Committees in Medicare

While formulary guidelines for the new Medicare outpatient drug benefit are being hotly contested, as described last month in P&T, there are also considerable differences of opinion about the composition and authority of the P&T committees that will be appointed by each prescription drug plan (PDP) to ride herd over their formularies.

The shape and role of the P&T committees drew much attention during hearings in the Senate Finance Committee in September, about one month after the Centers for Medicare and Med-icaid Services (CMS) proposed a rule outlining its initial thinking on many issues related to the new prescription drug benefit, which kicks in on January 1, 2006. The Medicare Modernization Act of 2003 (MMA), which authorized the drug benefit, left quite a bit to the imagination in terms of the role of P&T committees, as it did with formulary construction and many other items. But the CMS is now trying to fill in the blanks. That was the purpose of the proposed rule.
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For example, the MMA says that a PDP’s formulary must be “developed and reviewed” by a P&T committee. In its proposed rule, the CMS said it interpreted that language, at least on its first reading, to mean that the PDP has to do exactly what the P&T committee tells it to do. Now, the law doesn’t exactly say that, so the CMS asked for comments on that issue.

Regarding the composition of the P&T committee, again, the MMA is not very specific. The majority of members who make up the P&T committee would be required to be practicing physicians and/or practicing pharmacists. In addition, at least one practicing pharmacist and one practicing physician member would have to be experts in the care of elderly and disabled individuals. None of that is too controversial.

However, things get stickier when it comes to determining how many members of the committee must be independent and how that term is defined. The law says that at least one physician and one pharmacist must be independent. The CMS says that it interprets the statutory language in the bill—which refers to P&T committee members as being “independent and free of conflict with respect to the sponsor and plan”—to mean that such committee members must have no stake, financial or otherwise, in formulary determinations. This means that a pharmacist on the committee could not have any ties to the PDP or to any of its suppliers.
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At the Senate hearings, Michael J. Fitzpatrick, executive director of the National Alliance for the Mentally Ill (NAMI), testified on behalf of a number of patients’ groups. He suggested that the CMS go way beyond its proposed rule with regard to independence. He said that P&T committees should consist of a majority of independent members— not just two—who are practicing clinicians.

Moreover, he urged the CMS to adopt a series of “sunshine” provisions, which have no origin in the MMA. For example, he recommended that P&T committees provide the PDP’s members with advanced notice of their meeting agendas and that the committees accept public input on drug coverage decisions.

“We think members of a health plan ought to be able to attend the P&T committee meetings and make their feelings known,” explained Andrew Sperling, director of legislative action for NAMI, in a separate interview. “This happens currently with P&T committees for state Medicaid formularies.”

He added that the P&T committees should also be required to document and explain the reasons for their formulary decisions and to make these determinations public; again, Medicaid P&T committees are already doing this.
While patients’ groups are focused on expanding input into P&T committee decisions, the pharmacy benefit manager (PBM) industry wants to limit P&T committees’ range of action. Mark Merritt, president of the Pharmaceutical Care Management Association, said, “PCMA has concerns regarding the implication in the proposed rule that CMS is considering investing P&T committees with broad authority—beyond their areas of expertise—over administration of the entire drug benefit offered by a prescription drug plan.”

Mr. Merritt believes that P&T committee expertise lies in the evaluation of clinical safety and efficacy and that members typically do not have the financial and administrative management expertise necessary to develop and manage drug benefits.

“Considering [that] most P&T committees are independent from the PBM or drug plan, it would not be appropriate for them to be given authority for making decisions that affect a plan sponsor when they have no accountability for those decisions,” he adds.
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So the question is not whether P&T committees will help direct PDPs but whether they will be just traffic cops or more like police commissioners.

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Tags: P&T Committees

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