More than 60 Organizations Call on CMS to Improve Transparency, Curb Use of Utilization Management
Published June 9, 2025
Expanded use of utilization management (UM) tools in the Medicare Part D program fueled 64 organizations to sign on to a letter today to the Centers for Medicare and Medicaid Services (CMS). The letter to Dr. Mehmet Oz urges CMS to take steps to better protect beneficiaries by improving transparency around the impact of changes now in effect for Part D benefit redesign enacted under the Inflation Reduction Act. The letter also calls for CMS to institute additional guardrails to ensure that beneficiaries have appropriate and timely access to treatment.
Effective this year Medicare Part D plans are responsible for 60% of costs in the catastrophic phase, up from 15% in 2023. This higher level of cost sharing creates incentives for plans to increase their use of UM tools such as step therapy, fill limits, formulary changes, non-medical switching, and prior authorization requirements. While UM is intended to lower drug expenditures, and can be appropriate in some circumstances, restrictive cost-control measures can delay or prevent beneficiaries from accessing necessary treatments. This can have significant clinical consequences, especially for the populations served by the Part D program.
Adina Lasser, Director of Public Policy and Government Relations for the Alliance for Aging Research, which led the charge, said that UM is a threat to access for beneficiaries. “We are already seeing the expanded UM in Part D. The Medicare Payment Advisory Commission (MedPAC) reports that the use of UM tools such as quantity limits, step therapy, and prior authorization in Part D has grown,” Lasser said. Meanwhile, more Part D formularies are shifting from copayments to coinsurance, which often lead to higher and less predictable out-of-pocket costs for beneficiaries.
Additionally, UM tools in Medicare Part D impact beneficiary access and place significant burden on providers. Physicians and their care teams must navigate complex and often inconsistent UM requirements across plans, including time-consuming prior authorizations, appeals, and documentation processes. These administrative demands divert valuable time and resources away from direct patient care, contributing to clinician burnout and ultimately impacting the quality and timeliness of care delivered to Medicare beneficiaries.
The letter calls out Oz’s testimony to the Senate Finance Committee in March, in which he highlighted the fact that UM tools in Medicare Part D impact beneficiary access and place significant burden on providers. The letter’s signers agree that this issue deserves greater attention and action from CMS and appreciate him highlighting this issue in his recent testimony.
While the agency previously indicated that it is monitoring changes in formulary design, there are a number of additional, commonsense steps that CMS can take to better support beneficiaries in response to the groups’ UM concerns. The letter calls on CMS to:
- Outline clear expectations around the use of UM tools in Part D to ensure their appropriate use by plan sponsors.
- Increase transparency around plans’ use of UM, such as by incorporating relevant information into the Medicare Plan Finder.
- Enhance beneficiary education to help Part D enrollees be more informed about how their care may be affected by UM tools and, therefore, more empowered in their decision making as it relates to selecting the prescription drug coverage that will best meet their needs.