Apparent Change in CMS Policy Expands Inclusion of Lyrica in MSAs

October 26, 2018

Vial of pills illustrating MSA Reductions in RX costs

Lyrica is a brand name only medication which costs $8.91 per pill at 150mg. Over a 20-year life expectancy, this is close to $200K in an MSA allocation. Until recently, CMS largely excluded Lyrica from the MSA on the basis that the diagnosis for which it is being prescribed, typically neuropathic pain stemming from a lumbar injury, is considered non-Medicare-covered. Unfortunately, over the past three months, based upon MSA counter-highers received by Tower, CMS has seemingly begun to add Lyrica where a diagnosed condition of lumbar radiculopathy is present.

CMS Policy on Inclusion of “Medicare-covered” Medications in the MSA

Pursuant to the CMS WCMSA Reference Guide (Version 2.8), CMS will include causally related medications in the MSA under the following criteria:

Medically Accepted Indications and Off-Label Use

 For a drug to be covered under the Part D Benefit, and thus included in a WCMSA, it must be used for a medically accepted indication. A medically accepted indication is any use for a covered outpatient drug which is approved by the FDA or a use which is supported by one or more citations included or approved for inclusion in the recognized compendia.

Off-label use is when a drug is prescribed in a manner that is different from the FDA-approved product labeling. According to Medicare IOM 100-02 Chapter 15 Section, 50.4.2 – Unlabeled Use of Drug (Rev. 1, 10-01-03) B3-2049.3, “An unlabeled use of a drug is a use that is not included as an indication on the drug’s label as approved by the FDA. FDA approved drugs used for indications other than what is indicated on the official label may be covered under Medicare if the carrier determines the use to be medically accepted, taking into consideration the major drug compendia, authoritative medical literature and/or accepted standards of medical practice. In the case of drugs used in an anti-cancer chemotherapeutic regimen, unlabeled uses are covered for a medically accepted indication as defined in §50.5.” There are many off-label indications that are listed in recognized compendia and peer-reviewed sources; thus, they would be covered under the Part D Benefit, and should also be included in a WCMSA.

For example, trazodone is approved by the FDA for the treatment of major depressive disorder but is commonly given off-label to treat insomnia. So the WCRC would include trazodone in a WCMSA if used to treat insomnia if it is related to the workers’ compensation injury.

In summary, based upon this criteria, CMS’s practice has been to include medications in the MSA when either their use is for an FDA approved diagnosis or for a medically accepted indication as found in the “recognized compendia,” namely Micromedex’s DrugDex database or the American Hospital Formulary Service Drug. CMS cites the example of Trazadone which is FDA approved for major depressive disorder but is used off-label to treat insomnia. Insomnia is a medically accepted indication found in the DrugDex.

Inclusion of Lyrica in the MSA

In terms of Lyrica, the FDA approves its use for the following diagnoses:

  • Diabetic peripheral neuropathy
  • Fibromyalgia
  • Neuropathic pain from a spinal cord injury
  • Partial Seizure; Adjunct
  • Postherpetic neuralgia

If any of the above diagnoses are present in a claimant’s course of injury-related medical care, Lyrica would be included in the MSA, if prescribed. CMS would also include Lyrica if a medically accepted indication was found in one of the two compendia.

CMS’s recent inclusion of Lyrica where it is prescribed to treat lumbar radiculopathy does not fit into any of the FDA approved uses or the medically accepted indications found in the compendia. While an FDA approved use is neuropathic pain from a spinal injury, a spinal cord injury is typically defined as traumatic damage to the spinal cord resulting in permanent changes in strength and/or sensation and other bodily functions. This is very different than the intervertebral disc degeneration or post-laminectomy syndrome which may typically be causative factors for lumbar radiculopathy. Consequently, it is unclear why CMS has determined Lyrica should be included for a diagnosis of lumbar radiculopathy.

Tower MSA has submitted Re-Review requests to CMS, but the response has thus far been their restating of the policy on inclusion of “Medicare-covered” medications in the MSA. What CMS is not explaining is how the policy applied to the FDA-approved uses or compendia identified uses for Lyrica establish the basis for inclusion of the medication in the MSA. The National Alliance of Medicare Set-Aside Professionals (NAMSAP), for which Tower is a member, has reached out to the senior CMS management for clarification of CMS policy toward Lyrica. As of the date of this article, no response has been received.

Practical Implications

As highlighted at the top of this article, the inclusion of Lyrica in the MSA can add a significant sum to the allocation. While CMS has yet to provide a clear explanation as to their actions or issue an official policy statement, the trend from MSA counter-highers points to Lyrica being included in the MSA when lumbar radiculopathy is diagnosed. As detailed above, Tower does not believe this is an appropriate interpretation of CMS’s own rules for determining whether a medication is Medicare-covered and thus included in the MSA.

Until such time as CMS clarifies its policy, Tower will continue to exclude Lyrica from MSAs where we have not identified a medically accepted indication, either as an FDA-approved use or as found in the recognized compendia. As our client, we will advise you of the potential of a counter-higher from CMS, but will continue to challenge any counter-higher we believe inappropriately adds Lyrica.

In terms of options where an MSA includes a diagnosis of lumbar radiculopathy for which Lyrica is being prescribed, they are as follows:

  • Submit the MSA and risk a counter-higher;
  • Settle without CMS-approval of the MSA;
  • Await further challenges to CMS’s Lyrica policy to see if there is a rollback;
  • Consider alternatives to Lyrica use; or
  • Await Lyrica patent expiration for a price reduction when generics become available*

*While Pfizer’s patent on Lyrica was set to expire in December 2018, the FDA has extended it through June 2019 based on a program encouraging drug companies to demonstrate whether drugs have a pediatric use.

We will provide any updates which provide clarification as to CMS’s inclusion of Lyrica in MSAs. If you have any questions, please contact Dan Anders at (888) 331-4941 or