Medicare Part D plans cut coverage more than commercial plans after IRA changes

New NPC research finds Medicare Part D plans were more likely than commercial plans to restrict coverage for brand-only drugs in competitive classes after the Inflation Reduction Act took effect. The study points to millions of beneficiaries losing access to previously covered medicines and raises fresh questions about formulary oversight.

Why it matters: - Medicare beneficiaries appear to be losing coverage for some branded drugs faster than people in commercial plans. - The shift affects access to medicines in competitive classes, where multiple branded options exist and formulary placement can determine whether patients pay out of pocket. - The study adds to concerns that IRA-related Part D changes may be producing access tradeoffs alongside lower cost-sharing.

What happened: - The National Pharmaceutical Council published a study in Health Affairs Scholar on coverage changes in Medicare Part D plans from 2024 to 2026. - The analysis compared Medicare standalone prescription drug plans and Medicare Advantage Prescription Drug plans with commercial insurance. - The study focused on brand-only medicines in competitive drug classes with at least three commercially available, eligible brand-only drugs. - The researchers found Medicare Part D plans were more likely than commercial plans to restrict coverage after IRA implementation.

The details: - The IRA made major Part D benefit changes starting January 1, 2025, including a cap on patient out-of-pocket costs and higher catastrophic-phase liability for plans and manufacturers. - The study found an average of 4.5 million Medicare beneficiaries, including 2.7 million in PDPs and 1.8 million in MA-PD plans, lost coverage for previously covered branded medicines across 16 competitive classes. - Medicare coverage declined in both 2025 and 2026, with larger drops in standalone PDPs than in MA-PD plans. - In 2024, the average share of beneficiaries with coverage was 71.4% in commercial plans, 52.3% in MA-PD plans and 47.4% in PDP plans. - At the drug level, more than half of the included drugs in PDPs, 30 of 59 or 50.9%, saw coverage declines that affected more than 5% of beneficiaries from 2024 to 2026. - Those PDP drug-level declines represented at least 1.14 million fewer covered beneficiaries per drug. - At the class level, coverage fell by at least five percentage points on average from 2024 to 2026 in 10 of 16 classes in PDPs, seven of 16 in MA-PD plans and three included classes in commercial plans. - The study says incentives to exclude drugs may be highest in therapeutic classes with multiple branded prescription drugs, where plans can use exclusions to negotiate higher rebates. - NPC said the findings fit other post-IRA coverage changes, including increased deductibles, shifts to coinsurance and reduced coverage of therapeutic alternatives to drugs selected for the Drug Price Negotiation Program. - Dr. Campbell, the study co-author and NPC chief science officer, said beneficiaries are losing coverage for certain drugs at a higher rate than people with commercial insurance and called the pattern consistent with a theorized unintended consequence of the IRA.

Between the lines: - The study does not argue that the IRA reduced access uniformly across all drugs. The pressure appears concentrated in competitive classes where plans can use formulary design to manage rebates and spending. - The gap between commercial and Medicare coverage suggests Medicare plan design is changing in ways that may be more aggressive than the broader commercial market. - The findings also imply that lower beneficiary cost-sharing does not automatically translate into broader drug access.

What's next: - The authors say more research is needed as IRA implementation continues. - NPC says policymakers and stakeholders should keep monitoring Medicare patients’ access to medicines, health outcomes and whether Part D formulary review processes are protecting access. - The organization’s website is more information.