Kaiser Daily Health Policy Report Highlights Recent Developments In Medicare Rx Benefit

Main Category: Medicare / Medicaid / SCHIP
Article Date: 09 Nov 2007 - 12:00 PDT

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Several newspapers recently reported on developments related to the Medicare prescription drug benefit. Summaries appear below.

• Low-income benefit: Speakers on Monday at a Capitol Hill forum sponsored by the Alliance for Health Reform discussed problems with enrollment and access to medications for low-income Medicare drug plan beneficiaries and those with disabilities, CQ HealthBeat reports. According to Stuart Guterman, director of the Commonwealth Fund's Program on Medicare's Future, 48% of people with incomes up to 150% of the federal poverty level are unaware that they are eligible for the low-income benefit, and a disproportionate number of them are black or Hispanic or at the lowest end of the income scale. Laura Summer, a researcher at Georgetown University's Health Policy Institute, said two million low-income beneficiaries will be switched automatically to a new plan in 2008 that might not cover medications they take, adding that such beneficiaries might have to forgo taking needed medications while they work through the appeals process. AARP Policy Director John Rother called for changes in the way Medicare premium "benchmarks" are calculated to allow low-income beneficiaries to remain in the same plans from year to year. He also called on lawmakers to include asset test changes in Medicare legislation that will be considered later this year (Reichard, CQ HealthBeat, 11/5).
  
  
• Overpayments: WellPoint, UnitedHealth Group, Humana and other insurers that offer Medicare drug plans should have returned about $4.4 billion in 2006 overpayments faster, according to a report released on Tuesday by HHS Inspector General Daniel Levinson, Bloomberg/Indianapolis Star reports. According to the report, CMS "has no mechanism in place to identify situations in which prospective payments differ significantly from sponsors' actual costs or to adjust prospective payments accordingly to avoid large discrepancies at the end of the year." House Ways and Means Health Subcommittee Chair Pete Stark (D-Calif.), who is leading efforts to reduce the program's reliance on private insurers, said the insurers that owe refunds are getting "multibillion-dollar, zero-interest loans from Medicare." In a written response, acting CMS Administrator Kerry Weems said the overpayments are the result of drugs costing less than anticipated, and future estimated payments likely will be more accurate (Bloomberg/Indianapolis Star, 11/8).
  
  
• Premium increases: With the Medicare drug benefit open enrollment period beginning on Nov. 15, health advocates are warning that beneficiaries could be faced with premium increases and formularies that might not include drugs they need, according to the San Francisco Chronicle. The Chronicle reports that about 75% of beneficiaries nationwide will see premium increases if they keep their current drug plan. According to Tricia Neuman, a Kaiser Family Foundation vice president and director of the Foundation's Medicare Policy Project, "It may feel like the same old thing and not worth changing. But, in fact, plans are changing and consumers may find themselves better off making a switch." In addition, millions of low-income beneficiaries and those with disabilities who are dually eligible for Medicare and Medicaid could be switched automatically to new drug plans in 2008 that "may or may not cover their drugs," the Chronicle reports (Colliver, San Francisco Chronicle, 11/8).
  

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation© 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.