The ADVI Health  Strategic Analytics, Value and Economics  (SAVEs) Team worked with a US-based biopharmaceutical company to analyze manufacturing liability in Medicare Part D for 2025.

The Challenge

Medicare Part D underwent large changes to its structure, patient out-of-pocket limits, plan liability and manufacturer liability.  Manufacturers are particularly interested in understanding estimates of liability under the new Part D design.

The Strategy 

Using SAVEs access to 100% Medicare Part D Event (PDE) historical data, we modeled the 2025 Part D thresholds for maximum deductible and $2,000 out-of-pocket (OOP) cap on a per-patient basis. Importantly, plan-specific thresholds were applied to the data to account for variations in plan benefit designs. We then tracked accumulated beneficiary spending on Part D medications and total prescription costs longitudinally throughout the year to determine which prescription claims were dispensed in each phase of the benefit journey. With the patient benefit phase identified, manufacturer liability for each prescription was calculated. ADVI then modeled the manufacturer liability based on whether the manufacturer and product were full phase-in, specified, or specified-small phased-in approach.

The Results 

ADVI SAVEs forecasted manufacturer liability amounts for 2025 using historical claims data. While a manufacturer had knowledge of their volume in the Part D system, the manufacturer was blind to the other medications the patients were taking and how quickly they move through the Part D benefit journey. This work allowed the manufacturer to plan for 2025, and ADVI SAVEs continues to work with them to refine longer-term projected liability using projected sales numbers.

Learn More

Over the past 4 years, ADVI has leveraged its Innovator License to access CMS’ Virtual Research Data Center (VRDC) to help our clients with real-world evidence research needs. With over 20 years of combined VRDC experience, access to 100% of Medicare FFS Part A, Part B, and Part D, Medicare Advantage, Medicaid, and managed Medicaid claims, ADVI performs comprehensive research across key payers to assess the impacts of policies. Get in Touch to learn more about our Strategic Analytics, Value and Economics (SAVEs) team’s datasets and how we couple them with our expertise to provide insights in exploring Part D redesign impacts, market access assessments, cutting-edge HEOR analyses, and real-time COVID-19 research with our monthly data files.