On April 12, 2012, the Centers for Medicare & Medicaid Services (CMS or the “Agency”) published in the Federal Register a Final Rule with comment period entitled, “Changes to the Medicare Advantage Program and the Medicare Prescription Drug Benefit Programs for Contract Year 2013 and Other Changes.” In the Final Rule, CMS made a number of programmatic and technical changes to the Medicare Advantage and Medicare Part D programs, many of which were contained in a Proposed Rule published on October 11, 2011.

According to CMS, the Final Rule makes changes to the Medicare Advantage and Medicare Part D programs that are designed to (1) implement statutory provisions; (2) strengthen beneficiary protections; (3) exclude plan participants that perform poorly; (4) improve program efficiencies; and (5) clarify program requirements. This Client Alert summarizes several of the key changes to these programs that are contained in the Final Rule, including:

- Codification of the Medicare Part D Coverage Gap Discount Program;

- Transparency requirements for Medicare Part D Pharmacy Benefit Managers (PBMs); and

- The authority of Medicare Advantage organizations to limit coverage of durable medical equipment (DME) to brands, items and supplies of “preferred” manufacturers.