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Keywords:

  • prescription drugs;
  • Medicare;
  • formularies.

During congressional debate over the Medicare Part D prescription drug benefit, much attention was focused on nominal benefit design. Relatively little attention was paid to details about how plans would operate, such as the design of drug formularies. Yet, formularies will be important tools for controlling costs, and may be as important as nominal benefit design in determining enrollees' access to medications and out-of-pocket costs. We describe Part D plan incentives and how they may influence formulary design, and then provide recommendations for Part D formulary implementation. We encourage the Centers for Medicare & Medicaid Services (CMS) to develop standardized tools to provide physicians and patients with up-to-date and easily accessible information about covered drugs on each plan's formulary (perhaps via a central website) and a national set of easy-to-follow procedures for reconsideration and appeals. Such efforts should reduce administrative burden and better allow physicians to help patients obtain needed medications.