Part B Drug Cost Sharing Adjustments Required for Medicare Advantage Plans in 2023

Published On: November, 2022

The Inflation Reduction Act provisions mandating adjustments to cost sharing for Part B drugs subject to inflationary rebates were silent on the question of whether Medicare Advantage (MA) plans would need to adjust coinsurance for drugs subject to inflationary rebates for the previous quarter. On November 7, 2022, however, CMS released a memorandum titled, “Inflation Reduction Act Changes to Cost Sharing for Part B Drugs for Contract Year 2023 Medicare Advantage and Section 1876 Cost Plans.”

This guidance memo, issued without notice and comment, mandates that MA plans charging their members coinsurance for Part B and chemotherapy drugs, adjust coinsurance starting April 1, 2023 for any drugs subject to Part B rebates if cost-sharing would otherwise exceed the amount permitted under Part B. Where MA plans use copayments for Part B services including drugs, they do not need to make adjustments so long as copayments comply with cost sharing requirements in CMS’ April 2022 final rule, codified in 42 CFR 422.100. Similarly, insulin covered under Part B must be provided under the new coinsurance cap of $35.

For 2023 only, CMS will permit cost sharing adjustments to be made through refunds instead of at the point-of-service. Additionally, CMS instructs MA plans to amend their 2023 communications materials, including Evidence of Coverage and Summary of Benefits, to reflect the cost sharing changes.

MA plans that use coinsurance for Part B services need to evaluate how they will come into compliance with the new requirements in the event that CMS identifies Part B drugs subject to inflationary rebates for the first quarter of 2023.

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