Congressional lawmakers this week called on the Government Accountability Office (GAO) to quickly review the Premium Stabilization Demonstration for Medicare Part D plans.
The demonstration, announced July 29 by the Centers for Medicare & Medicaid Services (CMS), is intended to offset the higher premium costs expected to arise from the Inflation Reduction Act’s (IRA) Part D redesign, which shifted more financial liability from the government to Part D plans.
“The initiative lacks any budgetary analysis, clear statutory basis, or credible research goals,” wrote the lawmakers in an Aug. 5 letter sent to U.S. Comptroller General Gene Dodaro. “The integrity of the Medicare program and the taxpayer dollars that finance its benefits demand more than partisan aspirations to justify extra-statutory, eleventh-hour policy changes.”
U.S. Senate Finance Committee Ranking Member Mike Crapo (R-ID), U.S. House Ways and Means Committee Chairman Jason Smith (R-MO), and U.S. House Energy and Commerce Committee Chairwoman Cathy McMorris Rodgers (R-WA) wrote that the proposed demonstration employs arbitrary policy levers to achieve short-term objectives.
They pointed out that the policies advanced through the demonstration would simply shift costs from plan sponsors and enrollees to taxpayers, obscuring the law’s impacts without addressing their underlying drivers.
“Moreover,” they wrote, “consideration of these types of programmatic changes should fall within the purview of the legislative branch. Instead, however, this agency action seeks to sidestep Congress, waiving statutory directives under the guise of a ‘demonstration project,’ with no meaningful research aims, budgetary assessments, or empirical rigor.”
McMorris Rodgers, Smith, and Crapo added that their committees have worked on a bipartisan basis to advance policies intended to improve prescription drug access and affordability, and the Part D program should serve the needs of all seniors.
They requested that GAO’s review of the demonstration address several questions, including what budgetary analysis CMS used in developing the demonstration, what the estimated budgetary impact is of the demonstration, and whether the demonstration conforms to the principles of budget neutrality, among others.
“High out-of-pocket costs and premiums present barriers for far too many Americans,” wrote the members. “These challenges require durable solutions that comport with existing procedures, authorities, and laws.”