May 25, 2010

CHAMPUS/TRICARE

Proposed Rule
Summary

Score: 12 / 60

Additional details
Agency
Department of Defense
Regulatory Identification Number
0720-AB22
Rule Publication Date
07/25/2008

RULE SUMMARY

This proposed rule implements several changes enacted by the John Warner National Defense Authorization Act for Fiscal Year 2007 (NDAA-07), Public Law 109-364, and accompanying recommendations of the Conference Committee, set forth in H. Conf. Rept. 109-702. Specifically, this proposed rule recommends changes to adopt state-of-the art pharmacy benefit management practices to encourage greater use of the TRICARE Mail Order Pharmacy (TMOP) Program, generic drugs, formulary drugs, and over-the-counter drugs. 

METHODOLOGY

There are twelve criteria within our evaluation within three broad categories: Openness, Analysis and Use. For each criterion, the evaluators assign a score ranging from 0 (no useful content) to 5 (comprehensive analysis with potential best practices). Thus, each analysis has the opportunity to earn between 0 and 60 points.

Criterion Score

Openness

1. How easily were the RIA , the proposed rule, and any supplementary materials found online?
Proposed and final rules can be easily found on regulations.gov, the RIA is located in the rule itself (3 clicks). However, a RIN search on defense.gov found nothing.
3/5
2. How verifiable are the data used in the analysis?
The little data used is not linked or sources cited.
1/5
3. How verifiable are the models and assumptions used in the analysis?
There really is no model except an implication that a price ceiling will decrease expenditure. Other outcomes/consequences of the price ceiling are not considered.
1/5
4. Was the analysis comprehensible to an informed layperson?
The analysis is replete with acronyms and very confusing overall.
2/5

Analysis

5. How well does the analysis identify the desired outcomes and demonstrate that the regulation will achieve them?
3/5
Does the analysis clearly identify ultimate outcomes that affect citizens’ quality of life?
A reduction in the growth of federal spending; this is not specifically tied to quality of life in the RIA.
3/5
Does the analysis identify how these outcomes are to be measured?
Given the goal desired, it's easy track spending on pharmaceuticals by VA/DOD.
4/5
Does the analysis provide a coherent and testable theory showing how the regulation will produce the desired outcomes?
Setting a price ceiling on pharmaceuticals paid for by the government will lead to reduced expenditure.
4/5
Does the analysis present credible empirical support for the theory?
It is somewhat obvious, but empirical support is not given.
1/5
Does the analysis adequately assess uncertainty about the outcomes?
The analysis gives a fairly certain outcome in terms of spending. Uncertainty in how it affects citizens is ignored entirely, but so is the fact that it might affect citizens.
3/5
6. How well does the analysis identify and demonstrate the existence of a market failure or other systemic problem the regulation is supposed to solve?
1/5
Does the analysis identify a market failure or other systemic problem?
The analysis identifies the problem as fast growth in pharmaceutical spending, but it's not clear whether this is a systemic or a market failure.
1/5
Does the analysis outline a coherent and testable theory that explains why the problem (associated with the outcome above) is systemic rather than anecdotal?
The analysis refers to GAO study, but that's all.
1/5
Does the analysis present credible empirical support for the theory?
The analysis mentions spending numbers.
2/5
Does the analysis adequately assess uncertainty about the existence or size of the problem?
The analysis provides no model of projected expenditure or uncertainty around it.
1/5
7. How well does the analysis assess the effectiveness of alternative approaches?
0/5
Does the analysis enumerate other alternatives to address the problem?
The analysis does not address this topic.
0/5
Is the range of alternatives considered narrow (e.g., some exemptions to a regulation) or broad (e.g., performance-based regulation vs. command and control, market mechanisms, nonbinding guidance, information disclosure, addressing any government failures that caused the original problem)?
Only one option is considered.
0/5
Does the analysis evaluate how alternative approaches would affect the amount of the outcome achieved?
The baseline (current system) is weakly evaluated.
0/5
Does the analysis adequately address the baseline? That is, what the state of the world is likely to be in the absence of federal intervention not just now but in the future?
The baseline (current system) is weakly evaluated but only in the present.
1/5
8. How well does the analysis assess costs and benefits?
0/5
Does the analysis identify and quantify incremental costs of all alternatives considered?
Some costs are considered but very limited.
1/5
Does the analysis identify all expenditures likely to arise as a result of the regulation?
Identified expenditures are limited.
1/5
Does the analysis identify how the regulation would likely affect the prices of goods and services?
The analysis only discusses savings to the government resulting from lower-priced pharmaceuticals.
1/5
Does the analysis examine costs that stem from changes in human behavior as consumers and producers respond to the regulation?
The analysis does not address this topic.
0/5
If costs are uncertain, does the analysis present a range of estimates and/or perform a sensitivity analysis?
The analysis does not address this topic.
0/5
Does the analysis identify the alternative that maximizes net benefits?
Only one option is examined; alternatives are not considered.
0/5
Does the analysis identify the cost-effectiveness of each alternative considered?
The analysis does not address this topic.
0/5
Does the analysis identify all parties who would bear costs and assess the incidence of costs?
Government costs are considered, but nothing beyond that.
1/5
Does the analysis identify all parties who would receive benefits and assess the incidence of benefits?
The analysis does not address this topic.
0/5

Use

9. Does the proposed rule or the RIA present evidence that the agency used the analysis?
The analysis does not address this topic.
0/5
10. Did the agency maximize net benefits or explain why it chose another alternative?
The analysis does not address this topic.
0/5
11. Does the proposed rule establish measures and goals that can be used to track the regulation's results in the future?
Although it's fairly obvous that the government will likely monitor its spending related to this program and thus could know some outcomes, the regulation makes no commitment to do so or explanation of how it would do so.
1/5
12. Did the agency indicate what data it will use to assess the regulation's performance in the future and establish provisions for doing so?
The analysis does not address this topic.
0/5
 
Total 12 / 60