2025 Medicare Prescription Payment Plan CMS Requirements for Long-Term Care Pharmacies
The Centers for Medicare & Medicaid Services (CMS) added new requirements in 2025 as part of the Medicare Prescription Payment Plan, a new program part of the Inflation Reduction Act (IRA). Read below as we share the latest on these requirements and what we know for now as we monitor this evolving new regulation and its enforcement as it impacts Long-Term Care (LTC) pharmacies.
Understanding Medicare Part D Compliance Challenges for LTC Pharmacies
As defined in Section 11202(c) of the 2022 Inflation Reduction Act (IRA), the Centers for Medicare & Medicaid Services (CMS) rolled out the Medicare Prescription Payment Plan (MPPP), a new drug payment schedule option in 2025 for patients eligible under Medicare Part D. This program requires pharmacies to provide a likely to benefit notice to eligible patients the option to pay out-of-pocket drug costs in monthly payment installments over the plan year.
The Medicare Prescription Payment Plan (MPPP) requirements went into effect for pharmacies on January 1, 2025. At the time of writing, it is now fully in effect and pharmacies are actively required to provide a likely to benefit notice to eligible Medicare Part D enrolled patients. Reference this CMS timeline for a historical implementation schedule for this ruling for more insight into key dates as part of rollout.
Most Recent Guidance:
CMS has released two parts of final guidance to implement the Medicare Prescription Payment Plan for CY 2025, incorporating feedback received during public comment periods on the draft guidance. The final part one guidance, published on February 29, 2024, primarily addresses operational requirements for the program. Meanwhile, the final part two guidance, issued on July 16, 2024, centers on Part D enrollee education, outreach, and communication related to the program.
For 2026 and subsequent years, CMS aims to codify the requirements established in the final part one and part two guidance (click here to read the most recent press release from the CMS on this plan). Most provisions outlined in the proposed rule will maintain the 2025 program requirements for 2026 and beyond. However, CMS is introducing an automatic election renewal process, which will extend a Part D enrollee's participation in the program to the next calendar year unless the enrollee chooses to opt out. Additionally, CMS is seeking feedback on a possible requirement for Part D sponsors to process election requests submitted via phone or web in real time for 2026 and future years.
Additional resources from the CMS:
Please visit the CMS Medicare Prescription Payment Plan webpage to learn more about requirements, track new developments, and explore educational resources.
Below are additional links to helpful resources from the CMS.
Medicare Prescription Payment Plan Final Part Two Guidance (PDF)
Key Regulatory Updates for LTC Pharmacies
For LTC pharmacy compliance and audit preparation, you need to understand several critical requirements:
Mandatory notice provision to eligible Medicare Part D patients about payment options
New claims processing protocols with specific BIN/PCN requirements
Enhanced documentation requirements for Medicare Part D audit readiness
Integration with existing payment hierarchies while maintaining regulatory compliance
Specific procedures for LTC pharmacy cost tracking for Medicare Part D
Medicare Prescription Payment Plan Audit Readiness Checklist
To minimize Medicare audit penalties and maintain LTC pharmacy compliance, pharmacies must ensure they perform the following activities:
Process claims in the correct order, with Medicare Prescription Payment Plan transactions last
Accurately track and document all patient notifications
Maintain detailed records for potential LTC pharmacy compliance audits
Implement proper LTC pharmacy risk management for CMS regulations
Monitor and adjust Medicare Part D reimbursement changes
Framework LTC: Supporting Your Regulatory Burden Management
Understanding the challenges of Medicare Part D compliance for LTC pharmacies, Framework LTC version 3.1 includes enhanced features designed specifically for managing the CMS MPPP requirements:
Advanced tracking systems for Medicare Part D payment documentation
Streamlined processing for new prescription payment plan transactions
Comprehensive audit preparation tools
Integrated Medicare drug price tracking for LTC facilities
Automated compliance monitoring for regulatory updates
MPPP Readiness Checklist for FrameworkLTC Pharmacies
Reporting and tracking functionality has been added to FrameworkLTC to streamline compliance with these new requirements.
To ensure your pharmacy meets all Medicare Prescription Payment Plan requirements for LTC facilities:
Update to Framework LTC version 3.1 or later to access essential compliance tools including new Medicare Prescription Payment Plan reporting functionality
Train staff on new Medicare Part D regulations for long-term care pharmacies
Review existing processes to align with updated LTC pharmacy payment structure changes
Implement robust LTC pharmacy audit preparation procedures
Establish ongoing monitoring of regulatory updates for Medicare LTC pharmacies
The regulatory burden on Medicare LTC pharmacies continues to evolve, but with proper preparation and tools, you can maintain compliance while providing excellent patient care. Our commitment includes continuous monitoring of CMS payment rules' impact on LTC pharmacies and regular updates to our software to support your compliance needs.
Next Steps
For FrameworkLTC Users:
Framework LTC version 3.1 provides comprehensive tools for tracking Medicare Part D compliance, preparing for audits, and managing the new prescription payment plan requirements. For detailed information about these features, resources for FrameworkLTC customers are available on the Help Center.
Additional Resources from SoftWriters:
We'll continue to provide updates as guidance and regulatory rulings change, ensuring you have the support needed to navigate these requirements successfully. However, it is your pharmacy’s responsibility to stay watchful and ensure compliance with guidance as rulings will likely evolve and requirements may shift.
Is your Pharmacy Management System Helping you Stay Ahead of Regulatory Requirements?
If the answer is no. Then maybe it's time to try something new. Framework LTC is the number one pharmacy management solution for long term care pharmacies. FrameworkLTC is designed with regulatory compliance front of mind. New Feature functionality is constantly being added to helping LTC pharmacies not only stay on top of, but thrive underneath the increasing complexities and challenges presented by ever evolving regulatory requirements.
Schedule a Demo and See if FrameworkLTC is Right for You
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On-Demand Webinar On LTC Pharmacy DSCSA Compliance
Roadmap to DSCSA Compliance: A Pharmacy's Essential Guide
Go beyond this article and access our On-Demand webinar reviewing what you need to ensure complete compliance with the law. This webinar provides helpful tips, outlines the timelines for the various DSCSA compliance requirements, and explains how you can verify compliance from as the next phase of the law comes into full effect.