On April 4, CMS released the final rule setting policies for contract year (CY) 2026 for Medicare Advantage (MA) and Part D. The proposed rule dates to the Biden administration and, not surprisingly, many of the policies proposed by Biden-era CMS leadership were not adopted.
The most prominent of the rejected Biden-era policies is a proposal that would have extended Medicare Part D and Medicaid coverage to Anti-Obesity Medications, which CMS has historically found were non-covered given a statutory prohibition against coverage in Part D of agents when used for "weight loss" (state Medicaid programs are permitted to exclude agents for weight loss, but are not required to). There is no explanation given for the decision not to finalize this proposal. However, HHS Secretary Robert F. Kennedy Jr. is a known critic of the therapies, and that position may have influenced the final policy choice, though it remains possible CMS will take additional action regarding these drugs in the future. CMS also rejected a proposal to review Part D formularies and utilization management practices with a specific eye towards treatment of biosimilars and generics, though CMS expresses support for "providing broad access to generics and biosimilars" in Part D. Finally, CMS is not adopting a policy relating to Artificial Intelligence, though CMS hints at further rulemaking down the line and acknowledges "the broad interest in regulation of AI."
The rule does finalize several new provisions needed to implement Part D-related portions of the Inflation Reduction Act (IRA). Some of these were first promulgated in program instructions, such as rules for vaccine and insulin cost sharing, or implementation of the Medicare Prescription Payment Plan (with some minor changes from the original proposal). Others are adopted to support the effectuation of the Medicare Drug Price Negotiation Program. These include a requirement for Part D network pharmacies to be enrolled in CMS' Medicare Transaction Facilitator Data Module, and a new obligation for PDP sponsors to submit PDE records for selected drugs within 7 calendar days, rather than 30.
This rule is the first major policy announcement in the MA and Part D programs under the current Trump Administration. But insomuch as it deals with Biden-era proposals, the rule gives more a sense of what priorities from the prior administration CMS is declining to advance at this time, rather than what fresh priorities will be launched going forward.
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