Reference-based pricing in Part D

Executive Summary

Beginning Dec. 23, CMS will add a footnote to more places in its Medicare Part D Plan Finder Web site alerting users that reference-based pricing may apply to the cost of certain brands, a spokesman said. Approximately 10 percent of the 2009 Part D contracts use the reference-based pricing, according to the agency. Reference-based pricing in Part D involves the requirement that, on top of a co-pay, members must pay an additional charge if they choose a brand-name drug when its generic equivalent is available 1("The Pink Sheet," Dec. 8, 2008, p. 21). AARP wrote to CMS Dec. 16 requesting changes to Plan Finder to ensure greater transparency on the practice and that beneficiaries who enrolled based on "misleading" information in Plan Finder be permitted to switch plans beyond the Dec. 31 enrollment deadline