OBJECTIVES: Budget Impact Models (BIMs) are used to estimate the financial impact to a health plan of adding a new drug. ISPOR’s Guidelines for BIMs call for addressing the costs associated with current relevant therapies and new therapies. The US Medicare Part D benefit structure spreads liability across stakeholders: (1) private Part D insurers, (2) patients, (3) federal government, and (4) brand manufacturers. Stakeholder liability also changes as patient pharmacy spending increases and is based on the patient’s income status. Therefore, traditional assumptions used in most BIMs (e.g. 10% coinsurance / 90% plan liability; “simplistic approach”) will produce inaccurate results for Medicare Part D stakeholders. A more refined methodology using Part D claims should be utilized (“claims-based approach”). METHODS: Medicare Part D claims for patients were adjusted for new Brand Drug A and applied the Medicare Part D benefit structure. This simulation added Drug A scripts without replacing other drugs. Each Drug A price was simulated as price impacts patients’ total pharmacy spend. Assumptions used in all scenarios: 0% rebate, 0% discount, 12 scripts, 10% coinsurance (simplistic approach), and the 2021 Part D benefit structure enhanced with 10% coinsurance (claims-based approach). RESULTS: When Drug A had a price of $250 per 30-day supply, plan liability was $2,700 under the simplistic approach versus $2,300 under the claims-based approach. This $400 difference translates to 15% lower plan liability in the claims-based approach. When Drug A had a price of $750 per 30-day supply, plan liability under the simplistic approach was $8,100 compared to $3,600 using the claims-based approach, resulting in a difference of $4,500 or 56% lower plan liability. CONCLUSION: The difference in calculated plan liability under the simplistic versus claims-based approaches highlights the superiority of using the claims-based approach when estimating the budget impact to Medicare Part D plans.