Medicare To Revise Handbook for New Prescription Drug Benefit, Other Services, USA

Main Category: Medicare / Medicaid / SCHIP
Article Date: 24 May 2005 - 8:00 PDT

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In response to concerns expressed by insurers, lawmakers, insurance regulators and health policy experts,... CMS said it will revise its preliminary draft of the 2006 Medicare handbook to change statements that are "inaccurate, misleading or unclear," the New York Times reports. The 106-page draft of the Medicare handbook for 2006 was prepared by CMS employees. According to the Times, one problem is that the handbook fails to mention the so-called "doughnut hole" in coverage available under the new Medicare prescription drug benefit. Under the benefit, which begins Jan. 1, 2006, beneficiaries pay 25% of prescription drug costs up to $2,250 annually, but they are responsible for 100% of drug costs between $2,250 and $5,100 out of pocket. In addition, the current draft also says that the new drug benefit "will cover all the types of prescription drugs you may need" but fails to mention that beneficiaries might have to appeal to receive coverage for certain drugs. The handbook also received criticism for understating the financial penalties involved in beneficiaries enrolling in the new prescription drug benefit after the enrollment deadline, according to the Times. In addition, the handbook fails to clearly distinguish between traditional, fee-for-service Medicare and private Medicare Advantage plans, calling both "fee-for-service plans, available nationwide." Meanwhile, the term Medicare Advantage, which is the name used to replace the former Medicare+Choice term for private Medicare coverage, is not used at all in the 2006 handbook draft. HMOs and PPOs are called "Medicare health plans" in the draft. According to the Times, the handbook also "repeatedly suggests that private plans offer a better value than the traditional Medicare program," suggesting that the plans offer more coverage choices and health care benefits.

Comments
Vicki Gottlich, a lawyer at the Center for Medicare Advocacy, said it was "inaccurate and misleading" to emphasize the similarities between traditional Medicare and private health plans. The Blue Cross and Blue Shield Association said in a written comment, "There is no need to have pages and pages on the private fee-for-service option. Most people will think you are talking about traditional Medicare when you use that term." John Rother, policy director for AARP, said the group has met with Medicare officials several times to express concerns about "the accuracy, understandability and balance" of the information in the current handbook draft. CMS spokesperson Gary Karr said the agency is revising the handbook to address such concerns, noting that the final draft will include a "more detailed" description of the new drug benefit, including the doughnut hole. He also said the final version, to be mailed to beneficiaries in the fall, will distinguish between traditional fee-for-service Medicare and private health plans. "It's a real challenge to describe things accurately and completely while not giving so much detail that you overload and confuse the beneficiaries," Karr said. CMS Administrator Mark McClellan said, "There will be changes. We can communicate some things more effectively, more simply and more clearly." He added that he will "thoroughly review the handbook before it becomes final" (Pear, New York Times, 5/22).

Drug Benefit Enrollment
The Philadelphia Inquirer on Monday examined how the federal government is "hoping for a smoother rollout" of the new prescription drug benefit for low-income beneficiaries after "foul-ups spoiled the launch" of the new Medicare prescription drug discount card program. On Friday, CMS will begin mailing letters to 20 million Medicare beneficiaries asking them to fill out a five-page application for the new benefit. On May 31, another 10 million letters will be sent to beneficiaries notifying them that they automatically qualify for the new drug benefit. Some experts have expressed concerns about the "extensive application," which requires beneficiaries -- many of whom live alone, are ill or have cognitive impairments -- to document income and savings to qualify for additional prescription drug assistance. According to the Inquirer, there also is concern that the five-month gap between applying for the drug benefit in June and actually selecting a drug plan in November "could cause many people to forget the November enrollment requirement." Robert Hayes, director of the Medicare Rights Center, said, "My fear is that people who should get (the application) won't get it. That many who do get it won't open it. That many who do open it won't read it. And that many who do read it won't understand it." To address such concerns, the Social Security Administration has hired 2,200 employees to staff 1,300 local offices to help answer questions about the application. SSA also will spend $500 million to educate beneficiaries, according to agency spokesperson Mark Lassiter. In addition, the Access to Benefits Coalition -- a group of national organizations -- is organizing local outreach efforts to try to reach beneficiaries. Meanwhile, Medicare also is working with pharmacies, community groups, social services organizations and churches to provide applications and help low-income beneficiaries qualify for help. Enrolling low-income beneficiaries "is going to be a real challenge," McClellan said, adding, "But we're going to do significantly better than past programs that have tried to reach the same population" (Pugh, Philadelphia Inquirer, 5/23).

Physician Payments
In related news, Sens. Jon Kyl (R-Ariz.) and Debbie Stabenow (D-Mich.) have introduced a bill (S 1081) that would increase Medicare physician payments by 2.7% in 2006 and 2.6% in 2007. The legislation also would eliminate the current sustainable growth rate formula used to calculate Medicare physician payments. A similar bill (HR 2356) was introduced last week in the House by Reps. Clay Shaw (R-Fla.) and Benjamin Cardin (D-Md.). The House bill would increase Medicare payments to physicians by at least 2.7% in 2006 and replace the SGR. Under the SGR formula, Medicare payments to physicians are scheduled to be reduced by 5% in 2006 unless Congress acts to reverse the cut. In Senate floor remarks on Thursday, Kyl said the SGR "was intended to control expenditures by basing a given year's physician payment rate on the previous year's performance. Instead, it creates an arbitrary deficiency that continues to force Congress to intervene." Stabenow warned that without congressional intervention, physicians might be "forced to limit the number of Medicare patients they serve." Preliminary estimates show the cost of the Senate bill at $25 billion to $35 billion over five years. The American Medical Association praised the bill, saying it would "keep the Medicare program strong for America's seniors and disabled patients." According to CQ HealthBeat, Congress might take action to reverse the scheduled cuts, but lawmakers and lobbyists say it is unlikely Congress will eliminate the SGR this year (CQ HealthBeat, 5/20).

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