On June 27, 2016, the Department of Health and Human Services Office of Inspector General (“OIG”) issued a favorable Advisory Opinion, No. 16-07, relating to a savings card program under which individuals who have prescription drug coverage under Medicare Part D receive discounts on a drug that is statutorily excluded from Part D coverage.
According to the Advisory Opinion, the Requestor markets and distributes a prescription drug that has been approved by the U.S. Food and Drug Administration for the treatment of erectile dysfunction (the “Drug”). While the Drug is covered by many private insurance plans and some Federal health care programs, including state Medicaid programs and TRICARE, the Drug is statutorily excluded from coverage under Medicare Part D.
Under the arrangement, the Requestor offers and provides coupons, in the form of a savings card, which Medicare Part D beneficiaries (“Beneficiaries”) may use to receive discounts on the purchase of the Drug. Specifically, Beneficiaries may receive reductions on out-of-pocket costs greater than $15, up to a maximum benefit of $75 per prescription, on up to 12 prescriptions for the Drug, when they present their savings card and Drug prescriptions to their pharmacist.