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Medicare Part D Coverage Gap - Financial Implications of Reducing Drug Manufacturers' Liability

Under the Bipartisan Budget Act (BBA) of 2018, the closure of the donut hole for brand medications was accelerated from 2020 to 2019. This acceleration was accomplished by decreasing the member cost-sharing from the ACA established amount of 30% to 25%. In addition, the BBA increased the manufacturers liability from 50% to 70%, resulting in a plan liability of 5% (down from 25% in the ACA). Oliver Wyman's healthcare actuaries recently analyzed the financial impact of shifting 7% of the manufacturer costs for brand drugs in the donut hole to health plans (plan liability going from 5% to 12% and manufacturer liability going from 70% to 63%). The following report summarizes our analysis and findings.

Medicare Part D Coverage Gap - Financial Implications of Reducing Drug Manufacturers' Liability


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