Part D Payment Modernization Model Aimed At Reducing Medicare's Catastrophic Phase Spending

On January 18, 2019, CMS announced the Medicare Part D Payment Modernization Model, aimed at incentivizing Part D sponsors to reduce catastrophic phase federal reinsurance subsidy spending.  The model, which will begin January 2020, is a voluntary, five-year model open to eligible standalone Prescription Drug Plans (PDPs) and Medicare Advantage-Prescription Drug Plans (MA-PDs) that are approved to participate.  If a Part D sponsor chooses to apply with a standalone PDP in a Part D region, it must include all of its standalone PDPs in that Part D Region.  Similarly, if a MAO choose to apply with an MA-PD, it must include all of its MA-PD plan benefit packages offered in that Part D region(s).