Asclepios
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That Time of Year
November 30, 2006 • Volume 6, Issue 47There’s a nip in the air and a fat man in a red suit ringing a bell on the street corner. It can mean only one thing: it’s time for people with Medicare to figure out if their medicines will be covered by their Part D drug plan next year. Plans have near complete freedom to drop coverage, impose new restrictions and hike copayments on prescription medicines.
For many of the poorest older Americans and people with disabilities, the end of the year means the Centers for Medicare & Medicaid Services (CMS) will automatically enroll them in a new Part D plan for next year. Their current plan’s premium will be too high next year and the Extra Help program will not pay the full amount, but there is no guarantee their new plan will cover their medicines. Assignment is completely random.
This year the numbers affected are relatively small—maybe 500,000, maybe half that. It’s hard to get a straight answer because CMS played around with the formula that calculates the premium subsidy. CMS spent about $1 billion in higher subsidies to hold down the increase in monthly premiums and minimize the number of people facing random reassignment. Otherwise, 3.3 million impoverished people with Medicare would have been reshuffled among the insurance companies offering Part D.
The legislation creating Part D is a recipe for instability. Coverage is at the whim of the insurance companies. Poor people are treated like commodities available to the lowest bidding company.
If there was an option to receive drug coverage directly through Medicare, there would be a refuge from this chaos. Today, people with Medicare can choose between HMOs and other private plan options, but under Part D there is no Medicare option. Congress needs to fill that gap next year.
In the meantime, however, the Bush administration needs to act now to make sure the New Year does not bring with it new obstacles that prevent people from receiving the medicines they need.
At a minimum, CMS should require all Part D plans that are assigned low-income members to guarantee they will continue to cover the medicines these members need.
And every person with Medicare who jumped through hoops to get their Part D plan to cover their drugs should continue to get coverage next year. There is no excuse for CMS failing to require Part D plans to roll over these exceptions; if a drug is medically necessary on December 31, it is medically necessary on January 1.
The Medicare Rights Center made these and other recommendations in a November 13 letter to Acting CMS Administrator Leslie Norwalk. Last year, thousands of impoverished people with Medicare left pharmacies without their medicines because Norwalk’s predecessor failed to put in place adequate protections for some six million people switching from Medicaid to Part D drug coverage. Let’s get 2007 off to a better start.
Medical Record
“This year, I received notice that I was eligible for Extra Help paying for Part D. Needless to say, it’s been a blessing, enabling me to receive the three prescriptions I take. I recently received a letter from Social Security that says I will no longer be eligible for Extra Help next year because my income is too high. But my income has not changed, so I don’t understand why. I called Social Security, and they told me they would get back to me in four weeks. I have struggled with lifelong depression. I have tried different medicines, all with terrible side effects except one, which I currently take. It costs $300 a month, though. I’m very confused by all this, and I am worried about paying for my medicines” (Story submitted to the Part D Monitoring Project, Medicare Rights Center, November 10, 2006).
“You will recall that your predecessor, Mark McClellan, failed to heed repeated warnings of the problems expected when six million impoverished individuals were abruptly cut off from Medicaid coverage in 2005 and randomly assigned into a Part D plan in 2006. The results—thousands of Americans denied needed medicine and 37 state governments forced to launch emergency rescue programs—are a matter of record. While the number of individuals expected to face problems in the 2006-2007 transition is smaller, the health consequences of interrupted drug regimens remain equally dire for the individuals involved” (Letter to Leslie V. Norwalk, Esq., CMS Acting Administrator, Medicare Rights Center, November 13, 2006).
“The dynamics of the Part D benefit require the plans to lowball bids in order to garner automatic market share through the reassignment and auto-enrollment process. At the same time, the calculation of the low-income benchmark, once it is done according to the terms of the law, creates a downward spiral that eventually will eliminate all but the most bare-bones, low-cost plans from eligibility for a full premium subsidy. The only way to ensure stability for the low-income population and everyone with Medicare as well as comprehensive coverage is for Congress to enact a drug benefit administered directly through Medicare” (“Part D 2007: Addressing Access Problems for Low Income People with Medicare,” Medicare Rights Center, November 2006).
“[C]urrent law says that for 2007 CMS should weight Part D plan bids by their levels of enrollment in 2006…CMS is also supposed to use enrollment weighting to figure out the thresholds that determine which plans are premium-free to beneficiaries who receive Part D’s low-income subsidies. CMS made the decision to transition to enrollment weighting for both of these purposes in two separate demonstrations…according to CMS’s Office of the Actuary, these two demonstrations will cost $1 billion in 2007. They will also have costs in future years but we don’t know how much yet because CMS has not determined over how many years enrollment weighting will be phased in. The Office of the Actuary estimates that the second demonstration will reduce the number of low-income enrollees who would otherwise need to change plans or pay some of their premium to 500,000 people from what would have been 3.3 million people under current law” (Medicare Payment Advisory Commission public meeting, November 8, 2006).
***** The Medicare Rights Center (MRC) needs to hear about all the problems with the Medicare Part D benefit, whether they happen to you or someone in your community. With this information, we will be armed with the needed evidence to push for a Medicare-administered drug benefit.
Fast Relief: Part D Monitoring Project
Submit your story at www.medicarerights.org/partdstories.html
*****
The Louder Our Voice, the Stronger Our Message Asclepios — named for the Greek and Roman god of medicine who, acclaimed for his healing abilities, was at one point the most worshipped god in Greece—is a weekly e-newsletter designed to keep you up-to-date with Medicare program and policy issues, and advance advocacy strategies to address them. Please help build awareness of key Medicare consumer issues by forwarding this action alert to your friends and encouraging them to subscribe today.
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