Getting yourself ready for Medicare Rx
From the October ACP Observer, copyright © 2005 by the American College of Physicians.
By Bonnie Darves
This summer, the Centers for Medicare and Medicaid Services (CMS) gave seniors some good news: The average monthly premium for the new Medicare Part D prescription drug benefit that begins in January should be around $32.20, $5 less a month than previous CMS estimates.
But right now, what concerns patients—and their physicians—is figuring how this new benefit will work. Medicare Part D's complex structure and the fact that beneficiaries must choose one plan among many are bound to leave patients dazed and confused, at least initially. (See "How the Medicare prescription drug benefit works.")
"There appears to be a tremendous amount of confusion among patients regarding how this benefit is structured and which [benefit] level they will qualify on," said geriatrician Kay M. Mitchell, FACP, Governor for the ACP Florida Chapter and assistant professor of internal medicine in the Mayo Clinic's division of community internal medicine in Jacksonville, Fla.
So far, Dr. Mitchell noted, "there has been a lack of good information"—a situation the CMS will address this month with a massive information and patient outreach program. But internists also have questions about the benefit's potential effects on their prescribing patterns—and on patients' choice of physician.
The new drug benefit that takes effect Jan. 1 is voluntary coverage--one that an estimated 30 million of the total 42 million beneficiaries are expected to opt for. Beneficiaries can remain in fee-for-service Medicare and opt for a drug plan that covers only prescription drugs; this is the program that will cost an average of $32.20 a month. Local price variations will be in effect, and low-income beneficiaries can sign up for subsidies that will help them pay premium and deductible costs.
'It will benefit a lot of people who simply cannot fill their prescriptions because they can't afford to.'
—William J. Hall, MACP
Medicare beneficiaries may also enroll in a private Medicare Advantage Plan (HMO or preferred provider organization) that will provide drug, physician and hospital coverage. These Medicare Advantage plans will have a different cost structure that will vary from plan to plan. They could have a lower monthly premium—or none at all—than fee-for-service coverage, as well as lower deductibles and cost sharing.
Given the benefit's complexity and the array of choices patients will face when they begin enrolling next month, internists are bracing for an onslaught of questions.
"The problem is that ultimately, the final common pathway for most patients, if they can't understand something, is to ask their doctor about it—whether it's insurance, parking or something else," said geriatrician William J. Hall, MACP, director of the Center for Healthy Aging at the University of Rochester in Rochester, N.Y.
Dr. Hall's solution is to get himself and his staff up to speed on benefit details. The center has published an "important dates" benefit timeline in its patient newsletter, and staff is collecting a list of patient referral resources. (See "Part D rollout timeline.") Dr. Hall is also advising patients to learn about their medications so they'll be better equipped to choose a plan formulary once those details are announced next month.
In Bellevue, Wash., geriatrician Bruce C. Smith, FACP, said his practice is gearing up by scheduling patient education forums throughout the fall. Dr. Smith-who practices at Bellevue's Overlake Senior Health Center and serves as medical director at three nursing homes—said his group is also preparing its patient volunteer corps to become Medicare Part D "counselors." Those volunteers already assist in education programs on end-of-life issues and other topics.
"We are training the trainers," Dr. Smith said, "so they can help educate the rest of the beneficiaries about what is coming."
While physicians help marshal educational resources for patients, William D. Rogers, FACP, director of the CMS' physicians regulatory issues team in Washington, said that putting physicians in the position of helping patients choose Part D options is exactly what the CMS does not want to have happen.
"This [prescription drug benefit] should not be a burden for physicians," Dr. Rogers said. "We don't want them to end up being de facto guides on which plan patients should choose."
Still, he acknowledged that expected differences among plan formularies—with each geographic area offering at least two competing plans and urban areas perhaps ending up with a dozen—could pose prescribing challenges. While plans must adequately cover required therapeutic categories, they are not bound to include specific drugs. Different plans might cover, for example, different antihypertensives.
"There will be some variation among [formularies], but we don't expect that variation to be huge—and I'm sure the formularies will be more generous in their coverage than the average commercial plan," Dr. Rogers said. "The good news for practicing internists is that they won't have to worry as much that their patients won't take their drugs."
Physicians can file an appeal if they think patients need a non-formulary drug, he said, and a determination must be made within 24 hours. Further appeals are allowed if the plan denies the initial request
Before getting too involved in their patients' plan selection, Dr. Rogers urged internists to direct patients to regional and national resources, such as state health insurance programs, Social Security regional offices, retail pharmacies and, of course, Medicare itself. (See "Part D resources for physicians, patients.")
Besides providing Part D details in beneficiaries' annual "Medicare and You" handbook, Medicare has expanded its Web site and will substantially beef up staffing at its 800-MEDICARE call center. By late October, the call center is expected to have 9,000 service representatives—three times the current number.
The CMS is also launching major television and radio outreach campaigns. The CMS will post the formulary lists on its Web site and include it in programs designed for handheld computers. And the government is giving additional funds for the State Health Insurance Plans, located in each state, which can provide one-on-one benefit assistance to patients.
Dr. Rogers also recommended that internists who care for dual-eligible (Medicare and Medicaid) patients make sure those patients have a few months' supply of medications at year's end. "Those patients will be automatically enrolled in a Part D plan if they do not select a plan," he said, "and the possible formulary variations between Medicaid and Part D might mean physicians will make some prescription changes."
Despite the CMS' outreach efforts, the issue of formularies and what each plan will cover is still a wild card, making it hard for physicians to know what to expect. Florida's Dr. Mitchell is concerned that formulary variations will prove trying for physicians and patients.
"That's the hardest thing doctors will have to deal with," she said, "because most aren't going to want to change their prescribing habits."
And notwithstanding the CMS' advice, the array of formularies is pushing Dr. Smith's Washington practice to take a more active role in patients' decision-making. Dr. Smith said his practice wants to "steer" its nursing home patients into a finite number of plans, so he and his colleagues aren't facing "50 patients on 50 different plans." (According to Neil Kirschner, ACP's Senior Associate for Regulatory and Insurer Affairs, physicians must be careful not to steer patients to plans in which they have a financial interest, which is prohibited by Medicare.)
Patients who choose a Medicare HMO to try and reduce their total out-of-pocket expense may unwittingly end up with a bare-bones selection of covered drugs. Still others might not realize that their choice of a Medicare Advantage plan could force them to find another physician—and that physicians could lose patients. The Mayo Clinic, for example, does not accept Medicare HMO patients, Dr. Mitchell said.
In Washington, Dr. Smith plans to keep his eye on another unknown: what will happen to the dwindling but still available corporate retiree prescription coverage plans. A recent Hewitt Associates survey found that 58% of employers expect to take the offered 28% federal subsidy and continue retiree coverage, while 8% intend to drop coverage. The rest were either undecided or intended to offer some prescription coverage to supplement the Medicare benefit.
"There will be special issues for middle-class patients who have retirement benefits, and how this works out for them will be highly individualized," said Dr. Hall. He added, however, that the potential downside for middle-class patients is outweighed by advantages for low-income patients. "It will benefit a lot of people who simply cannot fill their prescriptions because they can't afford to."
Another unknown to consider: what impact Part D may have on free drug assistance programs now sponsored by pharmaceutical companies for low-income patients who need brand medications. That issue is of particular concern to Joseph W. Stubbs, FACP, an Albany, Ga., general internist and College Regent who chairs ACP's Medical Services Committee.
The 10-physician Albany Internal Medicine, where he practices, cares for an estimated 200 patients who use these programs. Even though paperwork is a nightmare for staff, the programs help ensure that low-income patients—regardless of age—receive drugs they need. With low-income Medicare patients now getting Part D coverage, Dr. Stubbs said he fears the free drug programs will disappear.
"For low-income Medicare beneficiaries, this [Part D] will be a benefit," said Dr. Stubbs, "but frankly, I don't think anyone knows yet what will happen with the majority of Americans."
Bonnie Darves is a freelance writer in Lake Oswego, Ore.
Medicare's new Part D prescription drug benefit is a voluntary program offered through either fee-for-service Medicare or private plans. It is also exceedingly complex because of its deductible and premium structure, staggered annual coverage schedule and limitations.
Here's how the standard benefit works:
Beneficiaries enrolled in the fee-for-service plan for 2006 will pay the first $250 of prescription drug costs (the deductible) and an average monthly premium of $32.20. Medicare then pays for 75% of drug costs until beneficiaries reach their initial $2,250 limit.
At that point, plan members enter the so-called "doughnut hole" or coverage gap, when they pay all drug costs until they reach the catastrophic limit of $5,100. Once they pass that point, enrollees pay only 5% of any additional drug costs. The deductible and limit cycle repeats annually—while deductible, copay and coverage gap amounts will all vary among the many private Medicare Advantage plans.
Should patients' prescriptions change, there's no guarantee that the plan they choose initially will still be the best fit.
Low-income beneficiaries may have lower costs (in the form of lower or no premiums and no "doughnut hole") than middle- and high-income individuals. But they are subject to complicated income and asset tests.
Those who earn less than 135% of the federal poverty level and have assets totaling less than three times the limit for Social Security insurance pay no premium or deductible and have no coverage gap.
They do have $2 copays for generics and $5 for brand-name drugs, and pay nothing for drug costs exceeding $5,100 annually. For patients whose incomes fall between 135% and 150% of the federal poverty level, a $50 deductible and sliding-scale premium apply—and patients must bear 15% of all drug costs. These individuals aren't subject to a coverage gap.
Patients may choose whichever plan best suits their needs, based on its offered formulary. Should their prescriptions change, however, there's no guarantee that the plan they choose initially will still be the best fit. According to the Medicare prescription drug legislation, plans may change therapeutic categories and classes only at the beginning of each plan year, unless new drugs or new therapeutic uses are announced.
But plans can make formulary changes once a month, although they must provide at least 60-days notice of a formulary change. That could spell trouble for patients and physicians if patients' prescribed medications are dropped.
The College has launched a Medicare Part D-dedicated Web site as part of ACP's Practice Management Center site. The Part D site "contains just about everything internists need to know about the drug benefit, with links to other resources," said Neil Kirschner, ACP's Senior Associate for Regulatory and Insurer Affairs.
The Centers for Medicare and Medicaid Services (CMS) has developed a broad range of materials—in print and online formats—to help physicians learn about the new benefit and assist patients. Here's a rundown of some of the best resources:
The CMS has posted a complete list of provider education and outreach materials. Physicians can also use the site to sign up for e-mail updates on Part D developments and news.
Physicians can download the CMS' "Toolkit for Healthcare Professionals: Medicare Prescription Drug Coverage," which includes physician and staff education materials, patient handouts written in English and Spanish, and reproducible artwork that can be used on practice-generated materials.
A brochure entitled "A Guide to Getting Started, Introducing Medicare Rx" should be coming to your office soon. Currently being distributed to doctors' offices nationwide, the brochure focuses on patient care and is intended for patients. It also can be found online.
Patients who can't or don't want to navigate Medicare's Web site to learn about plan options should call the toll-free number, 800-MEDICARE. The CMS plans to triple the number of representatives available to help answer beneficiaries' questions. The CMS will also offer beneficiary-targeted Part D assistance at its benefits "checkup" Web site.
A Part D fact sheet is available here.
More than a dozen organizations—including the AARP, the AMA, the American Hospital Association and the American Academy of Managed Care Pharmacy—have created the Medicare Rx Education Network. The site includes a helpful question-and-answer section, with links to news articles and an annotated "important dates" timeline.
The AARP's Web site, offers news articles on anticipated problems, asset testing and benefit qualification, and the benefit's structure.
Physicians anticipating a barrage of patient questions about the Medicare Part D program know key rollout dates and events. These include:
All beneficiaries receive the annual "Medicare and You" handbook, which will include detailed information about the new Part D benefit and "beneficiary-individualized" listings of locally available plans.
Medicare notifies dual-eligible beneficiaries of the plan it has enrolled them in as of Jan. 1, 2006, if patients don't sign up for one on their own.
Employees and unions must advise members on how their current prescription coverage compares with the prescription drug benefit. Also, Medigap insurance companies must notify members with plans H, I and J with details on how their coverage compares to Medicare Part D.
Nov. 15, 2005
Part D plan enrollment process begins. The two-week period that follows may be "prime time" for patients asking physicians and staff for assistance and resources.
Dec. 31, 2005
The last day beneficiaries can enroll in a plan and still receive benefits on Jan. 1, 2006.
Jan. 1, 2006
Prescription drug coverage begins.
Beneficiaries who haven't enrolled in a plan begin receiving reminder notices.
May 15, 2006
Last day beneficiaries can enroll and still pay a lower premium. The next enrollment period begins Nov. 15, 2006.
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