| Statement of the Center for Medicare Advocacy, Inc.
The Center for Medicare Advocacy,
Inc. (the Center) submits this testimony to be included in the record of the
hearing on Implementation of Medicare Part D, held before the Health
Subcommittee of the Committee on Ways and Means on Wednesday, May 3, 2006.
Founded in 1986, the Center is a
national, non-partisan educational and advocacy organization that identifies
and promotes policy and advocacy solutions to ensure that elders and people
with disabilities have access to Medicare and quality health care. The
Center’s national office is in Connecticut, with offices throughout the
country, including Washington, D.C. The Center represents thousands of
individuals in Medicare appeals each year, responds to calls and e-mails from
individuals in Connecticut as well as from all across the United States, and
provides support to CHOICES, the Connecticut state health insurance program.
Requests to the Center for assistance have increased exponentially with the
advent of Medicare Part D.
The White House and the Centers
for Medicare & Medicaid Services (CMS), in their efforts to promote Part D,
proclaim that “the new drug program is working well for most seniors (sic) and
pays nearly all of low-income beneficiaries' drug bills.” See, e.g., "The
Medicare Prescription Drug Benefit: Helping Seniors and Reducing Costs," a
Fact Sheet issued by the White House on March 14, 2006.
What they do not say is that many
of the beneficiaries encountering problems are dually eligible for Medicare and
Medicaid (dual eligibles). The barriers to their getting drugs that were
previously paid for by their Medicaid programs are not temporary glitches but
result from the very design of the Part D program. The Center avers, based on
our conversations with Medicare beneficiaries, their families and their
advocates, that this most vulnerable population is, as a whole, much worse off
than they were before they were shifted from Medicaid to Medicare drug
coverage.
Problems and recommended
solutions include:
1. Dual eligibles have been
randomly assigned to average-cost prescription drug plans, most of which do not
cover all drugs commonly used by this population.
To ensure no gaps in coverage
when dual eligibles transition from Medicaid drug coverage to Medicare drugs
coverage, the Medicare Modernization Act provides for them to be randomly
assigned to plans if they do not choose a plan on their own. Random assignment
benefits Part D drug plans by guaranteeing them an equal portion of the
enrollment of the dually-eligible population, without burdening them with too
large a portion. Random assignment does not, however, benefit beneficiaries.
The Inspector General of the
Department of Health and Human Services has determined that nearly one-third of
dually eligible beneficiaries – a highly vulnerable population with unusually
high medication needs - were assigned to drug plans that included less than 85%
of the 178 most commonly used Part D drugs.[1] Some of the drugs
excluded from a substantial number of plan formularies (lists of covered drugs)
are drugs for high blood pressure, high cholesterol and pain relief.
Only 18% of beneficiaries were
assigned to plans that covered all 178 drugs, but this does not mean that even
these plans cover all drugs needed by each beneficiary - only that they cover
the most commonly used drugs. Moreover, even plans that cover all drugs may
have quantity limits, prior authorization and other barriers to immediate and
full coverage of an individual beneficiary's prescription drug needs.
Other researchers came to similar
conclusions after reviewing formularies of plans available in specific
regions. For example, Jocelyn Guyer and Jeffrey S. Crowley of the Georgetown
Health Policy Institute wrote a series of three policy briefs for the
Connecticut Health Foundation. They found large variations in the extent to
which the 44 stand-alone prescription drug plans available in Connecticut
covered medications, with major and frequent shortcomings in coverage of
critical drugs used by dual eligibles.[2]
A 33 year-old beneficiary from
Orange Part, Florida, described the difficulties experienced by dual eligibles
in an e-mail sent to the Center last week:
[3]
I have been on
Medicaid since 1996, and Medicare since 1998. I get Social Security Disability,
and I am below the poverty level. Since Medicare Part D., has kicked in. I have
had to pay for medicines that Medicaid used to pay for, now I'm responsible for
the co-pays of my medicines. I am a kidney transplant patient and have been a
diabetic for 30 years. I also have been diagnosed with HIV in 2001. I can't pay
for my medicine copays, because I make approximately $8,500 a year. Even with
the "extra help" that I get from Medicaid, I still have to pay about
$40 a month for medicines. However, my medical insurance doesn't cover my
transplant medications or my HIV medications. These medicines cost about $400,
a month. What has the president done? Is there a plan to kill off the elderly
and sickly, or do we just have to suffer the consequences? Thank you for
letting me speak my peace.
Center
for Medicare Advocacy Recommendation: In assigning beneficiaries to plans they
have not chosen, more attention must be given to matching individual
beneficiaries' drug usage and pharmacy preferences with the formulary and
pharmacy networks of individual plans.
2. Getting coverage for drugs
that are not on a plan's formulary involves engaging in one of several complex processes.
The frailty of this population, including a high incidence of cognitive
impairments, makes navigating those processes more difficult than for other
beneficiaries.
Applying for an Exception.
Each plan must have a process for enrollees to ask for an exception to
non-coverage, and each plan's process is different. The Center is part of a
group, spearheaded by the American Medical Association (AMA) and working in
conjunction with America’s Health Insurance Plans (AHIP), that has developed a
model exceptions request form. Although CMS has posted the model form on its
web site, and AHIP members may post the form on their web sites, CMS does not
require the form to be used by the plans.
An exception request must include
a doctor's statement that all drugs on the formulary are either less effective
or harmful to the beneficiary or both. Some plans are requiring the submission
of clinical notes verifying such assertions. Because each plan's process is
different, physicians must deal with multiple processes to serve all their
patients. Some doctors are charging for completing prior authorization and
exception request forms. Dual-eligible beneficiaries who cannot pay even
nominal fees for this service cannot avail themselves of the exceptions and
appeals processes.
The problems that arise from
trying to navigate the exceptions process are almost too numerous to include in
testimony. The issues brought to our attention by Medicare beneficiaries,
their families, and their advocates include:
- Not
knowing that there is a process to request an exception or coverage
determination;
- Not
getting through to customer service offices;
- Customer
service offices not being available to accept emergency calls from doctors
outside of normal business hours;
- Not
having the exception request treated as an exception because the
beneficiary did not use the proper term;
- Having
to fax or mail to a plan a preliminary request form in order to get the
request form that will start the coverage determination process. Without
a coverage determination a beneficiary cannot file an appeal;
- Plans
not complying with statutory time frames;
- Plans
not forwarding cases to the independent review entity as required when
time frames are not met;
- The
independent review entity failing to conduct a new, independent review of
the medical evidence.
Changing prescriptions.
Plans encourage enrollees to change from an uncovered drug to one on their
formulary. Such a change presumes that there is a drug on the formulary that
would work as well as the uncovered drug. Making such a change may involve
multiple visits to a doctor's office, each of which may cost money in terms of
transportation and office visit co-pays, for the doctor to first prescribe, and
then monitor, use of the alternate drug. Duals often do not have the resources
to pay for the transportation or the cost-sharing for such visits. Since many
use clinics, they may not be able to get an appointment with a doctor before
their medication runs out.
Changing to a plan that covers
the drug in question. Unlike most Medicare beneficiaries, dually eligible
beneficiaries are allowed to change plans whenever they want to, with their new
coverage effective the month following their action to change. Changing plans,
however, is difficult and not without risks. First, the number of average cost
plans in each region ranges from six to eighteen and the systems available to
help beneficiaries know what each plan covers require access to high speed
Internet service and a printer. Few dual-eligibles use the Internet, so to
make use of these decision supports, a beneficiary must generally get help from
someone else. The programs that are funded to counsel beneficiaries are
overwhelmed by people needing such assistance and by the many difficulties that
have arisen during the first months of the program.
Moreover, processing new
enrollments in a plan is complex, requiring communication between the old plan,
CMS, the new plan, and another government contractor. The information takes
days to weeks to run through the system; a change made toward the end of the
month will not show up in the system until later the following month, making it
difficult to purchase drugs in the first part of the month.
Finally, plans can change the
drugs on their formularies at any time, with 60 days' notice to individuals
taking the drugs in question.[4] Even an intelligent
choice of a plan covering all of a beneficiary's current drugs could be for
naught, if the plan removed some or all of those drugs from its formulary two
months later. An April 27, 2006 Memorandum from Abby Block of CMS to Part D
Sponsors, "Formulary Changes during the Plan Year," suggests that
plans continue to cover a drug for any plan enrollee who is currently taking
the drug even after the plan removes the drug from its formulary for other
enrollees. Unfortunately, this CMS Memorandum to exempt current enrollees from
formulary changes involving their current drugs is not binding on any
plans. This Memorandum, like the rest of the policy guidance issued by CMS to
implement much of Part D, has not gone through the Administrative Procedure Act
notice and comment rulemaking process, and does not have the same legal effect
as the statute and the implementing regulations.
The consequences to beneficiaries
are enormous, as these client experiences demonstrate.
It was extremely
stressful to get a plan picked out that would even cover my medicines, I'm
disabled not old and every step of the way has been a battle. The insurance
company STINKS. I have to fight for nearly every prescription. From getting
the right generic to one they prefer. It's almost like they are my Dr, not the
insurance plan. I have had to go the the ER several times becuase I was forced
to wait or fight for meds that would have helped. I also have athsma and now
they are denying my singulair, suddenly some crap about needing pre-approval.
This is some of the worst insurance ever. Medicare Part D is one of the worst
things the Bush administration has done.
– E-mail dated
April 26, 2006, from a 35 year old female in Hawley, Minnesota.
My other half has
AIDS and our pharmacist suggested that we go with AETNA because it covers all
his HIV meds as well as all the other meds he's on. So we signed him up for it
and now it seems like each month they are not wanting to pay for certain
non-HIV medications. They want him to take something else. One of those is to
prevent him from getting pneumonia. It's Bactrum. Their formulary on-line
says they will pay for it, but their letters keep saying they won't. After one
month he's already into the catastrohic coverage part because of all the meds
he's on. Every month it's a different story, a different medication is being
denied. What gives them the right to play doctor with people's lives?
– E-mail dated
April 26, 2006, from a 42 year old male in Land o Lakes, Florida
Center for Medicare Advocacy
Recommendations:
(1) Exceptions processes
should be uniform for all plans, with a single form made available to all
physicians and pharmacists;
(2) Plans should be prohibited
from removing drugs from their formulary during the plan year;
(3) More money should be made
available to programs that provide individualized assistance to beneficiaries.
3. Plans' transition policies
have been difficult to get and difficult to enforce at the pharmacy level.
Each plan is required to have a
transition process to address the situations of new enrollees who are taking
drugs not on the plan's formulary. The transition policies include special
focus on the needs of dually eligible beneficiaries. While issues with
transitions have been prominent in the early months of Part D because the
entire program was "transitioning" into existence, transitions will
occur every month as new enrollees join plans, and especially every January,
after major plan shifting has occurred during the annual enrollment period in
November and December.
CMS asked plans to extend the
transition coverage of non-formulary drugs through the end of March, so that
beneficiaries could get a 90-day supply. Such an extension was voluntary on
the plans' part. And, even after the extension request, dually-eligible and
other beneficiaries are coming away from the pharmacy with no prescription, or
with just a few days' supply of pills.
Moreover, the transition is
merely to allow the beneficiary to change drugs, change plans, or request an
exception so that her drug can be covered even though it is not on the
formulary. But many beneficiaries are not receiving the notices they are
supposed to get telling them what they should do next. For example, Center
staff spent many hours during February and March 2006 helping a woman in
California get coverage of a prescription that she had been taking for 35 years
for a chronic condition. (Part of the problem was that the plan could find no
record of her enrollment until mid-February.) She contacted us last week to
say that, although she had received the prescription in February and March, the
plan was once again telling her that the drug was not covered. We suspect that
she got the drug in February and March under the transition process, and now
the plan wants her to go through the exceptions process – again – to get her
medically necessary drug.
A 58-year old male from Jellico,
Tennessee commented to the Center via e-mail about the transition process:
I Called First
Premier Health(my Provider For Part D to see if All My Medications Were Covered
before I Signed on With Them, They Assured Me They Were, After 2 Month's They
Wrote Me A Letter Saying that My( Pravachol) Was No Longer Covered, I Had to
Try Alternative Meds First, Hell I've Tried Them All, Pravachol Works The Best
For Me, I've Been On It For Over 4 Years Now!! This Does Not Make Any Sense!!!
Thank You!! I Have Always been Taught When Something Works Real Well For You,
Stay With It!!!!
Center
for Medicare Advocacy Recommendations:
(1)
Transition policies should be uniform across plans and easily made known to
beneficiaries and pharmacists;
(2) Plan
call lines, for pharmacists to get instruction to override codes, should be
required to operate 24 hours a day, seven days a week;
(3) CMS
should enforce contract requirements of plans.
4. Dually eligible
beneficiaries using long-term care services are treated differently depending
on where they receive the services.
Dually eligible beneficiaries are
provided the best Part D subsidy available under the law. They pay no premium
(for an average cost plan) or deductible, have no coverage gap (doughnut hole)
and no cost-sharing at all after they reach the catastrophic coverage
threshold. Their co-payments vary from $0 to $5, depending on income or place
of residence.
Dually eligible beneficiaries
residing in nursing homes and certain other institutions have no co-payments,
since they pay all but a very small amount of their income over to the
institution that is caring for them. Dually eligible beneficiaries who are
getting their long-term care services in assisted living facilities, board and
care, and other similar community settings, however, are treated differently
and may have co-pays as high as $5 per prescription (for typically more than 10
prescriptions), even though they, too, must pay most of their income to their
care provider and even though their care needs are similar to those of nursing
home residents.
Center
for Medicare Advocacy Recommendation: All dually eligible beneficiaries
receiving long-term care services should be treated similarly and should have
no cost-sharing obligations, since most of their income is given over to the provider
of service.
5. Dually eligible
beneficiaries have lost Medicaid as secondary coverage.
The most common interrelationship
between Medicare and Medicaid is that Medicare is the first payer for services
and Medicaid picks up where Medicare coverage stops. This is not true under
Part D. Medicaid is prohibited from paying for drugs that are covered by Part
D. For a state to provide the kind of "wrap around" coverage that is
typical for other services, it must use its own money, without any federal contribution.
According to the Inspector General of the Department of Health and Human
Services, only four states have indicated they will provide some kind of
coverage for drugs that are not on a Medicare plan's formulary.
Part D imposes prescription drug
co-payments for the first time on a substantial number of dual eligibles,
including the 1 million dual eligibles in California (approximately one-sixth
of the dual eligible population). While the co-payments for duals are supposed
to be minimal, for someone living on $817 (100% of the federal poverty level
for an individual) or less each month, $3 per prescription is a fortune. As a
beneficiary from New York wrote to the Center recently, she lives on Social Security
disability benefits and cannot afford to pay the $3 co-payment every time she
goes to the pharmacy.
For some dual eligibles who
previously qualified for Medicaid on a “spenddown” basis, the advent of Part D
means they will lose all of their supplemental health coverage. A 60-year old
client from Milford, Connecticut, who has Hepatitis C, has long alternated
between Medicaid and ConnPACE, the state pharmacy assistance program, to
help with prescription costs during his spenddown periods. He takes
several very expensive medications and qualifies for the low-income
subsidy. In fact, prior to Part D, when the entire cost of his medication
– including the portion paid by ConnPACE – was applied against his spenddown,
he usually met his spenddown obligation in less than one month. With the
advent of Part D, only that portion which he pays – his $2 and $5 LIS co-pays – will
count against his spenddown obligation. Our client correctly perceives
that he will probably never meet his $3,000 spenddown obligation at this
rate. He currently is in need of an expensive medical test that he
cannot afford, and is having difficulty finding a provider who will accept him
as a patient as he no longer has Medicaid coverage and is unlikely to obtain it
in the future.
Center
for Medicare Advocacy Recommendation:
(1) Amend the law to provide dual eligible coverage for prescription drugs,
just as it exists for other health care services, including federal matching
funds for state expenditures;
(2) Amend the law to allow Part D drug costs, including the low-income
subsidy, to count toward Medicaid eligibility based on spenddown.
6. Individuals with Medicaid
will experience a gap in prescription drug coverage when they first become
eligible for Medicare.
Individuals with Medicaid lose
their Medicaid drug coverage on the first day of the month that they become
eligible for Medicare, even if they have not enrolled in a Part D plan. The
state will transmit information about them to CMS when the state becomes aware
of their new dual eligibility status. It is unclear, however, whether and when
states will have that information. In addition, states often send information
to CMS about new dual eligibles only once a month, generally at the end of the
month. CMS may not be able to enroll a new dual into an eligible plan in time for
drug coverage to begin the following month. CMS has indicated that Part D
coverage will be retroactive, but it is unclear how duals will pay for their
prescriptions while coverage and plan enrollment is being determined.
New dually eligible individuals
can use the Point of Service (POS) option at the pharmacy that facilitates
enrollment into the point of service contractor. The contractor will then
inform CMS so that the individuals can be enrolled into a plan. Under the POS
option, the pharmacy distributes a 14-day supply of medicine to the individual,
with the possibility of an additional 14-day refill. Individuals who try to
get prescriptions under this option at the beginning of a month may not have
sufficient medicine to last until they are enrolled in a Part D plan.
Center
for Medicare Advocacy Recommendation: Identify Medicaid recipients who are
about to become Medicare eligible sufficiently in advance to auto-enroll them
in a Part D plan before they lose Medicaid drug coverage. Alternatively,
continue Medicaid drug coverage for these individuals until they are enrolled
in a Part D plan.
Conclusion
Many of the problems and issues
described above arise from or are complicated by the number of plans available
and the fact that each plan has its own design, including formulary, transition
processes, exceptions and appeals processes. Virtually no uniformity exists or
is required.
Even after beneficiaries, their
families, and their advocates spend hours and days on the phone trying to
resolve issues with their Part D plans and with CMS, there is still no
guarantee that the problem will be resolved. Our client, Mary F., from
Willimantic, Connecticut, exemplifies the problem. She gets by on limited
income, and it is not unusual at the end of any month that she is down
to her last $5 in quarters for her laundry. She takes several
medications, among them a pain reliever for severe gout. She is on
ConnPACE and a Medicare Savings Program. She has documentation that she
was awarded the full 100% low-income subsidy, and thus should be paying $2
or $5 for co-pays. However, Medicare has informed her plan that she
qualifies for a partial subsidy, with 15% co-pays. Mary cannot afford to
pay even ConnPACE's $16.25 co-pays and, therefore, has gone without a new
pain medication her physician prescribed a week ago. She is
owed over $70 in co-pay overpayments to her pharmacy and has been told it may
take up to 10 weeks to be reimbursed. Despite repeated efforts on
the part of the Center, as well as CMS's intervention in this case, the
problem persists.
Overall Center for Medicare
Advocacy Recommendations: Create a single, standard Medicare prescription drug
benefit, administered by the Medicare program, that is uniform nationwide.
Require CMS to oversee the program with mandatory due process standards.
Thank you for the opportunity to
submit this written statement. We look forward to working with Congress to
ensure that elders and people with disabilities have access to a meaningful and
affordable Medicare prescription drug benefit.
Judith Stein
Executive Director
Patricia Nemore
Senior Policy
Attorney
Vicki Gottlich
Senior Policy
Attorney
[1]
Office of Inspector General, “Dual Eligibles” Transition: Part D Formularies’
Inclusion of Commonly Used Drugs,” (OEI-05-06-00090 January 2006).
[2]
The policy briefs are available at www.cthealth.org.
Judith Stein, Executive Director of the Center, was a research contributor to
the policy brief on Implications for dual eligibles.
[3]
Beneficiary comments are verbatim and may contain grammar mistakes.
[4] Note that the regulations specifically allow Part D
plans to change their formularies. 42 C.F.R. § 423.120(b)(5),(6).
| 
