Medicare Prescription Drug Plans

1
IMPORTANT INFORMATION FOR HEALTH CARE
PROFESSIONALS

2
Changes in MedicareKeeping up with Todays
Health Care

• Promoting a healthy lifestyle
• Covering preventive services
• Offering prescription drug coverage
• Expanding coordinated care options
• Including care for chronic conditions
• Helping people with Medicare live longer,
  healthier lives

3
Objectives

• Recognize important dates in 2005 and 2006
• regarding Medicare prescription drug coverage
• List the fundamental components of
• Medicare prescription drug coverage
• Identify the various types of plans available to
• people with Medicare
• Recognize the special assistance available to
• people with limited incomes and resources
• List valuable Medicare resources that help
• people with Medicare and health care
  professionals

4
A Call To Action
Mark. B. McClellan, MD, PhD

• The new drug coverage is
• the most important new
• benefit in Medicare in 40
• years We know how
• busy you are, so weve
• provided simple ways to
• get information to your
• Medicare patients.

5
As a fellow health professional
Mark. B. McClellan, MD, PhD

• I know you appreciate the importance of
  prescription drugs for your patients with
  Medicare, as well as how vital insurance is for
  financial protection in the event that they need
  up-to-date drug treatments. Thats why we want to
  make sure you know the basics about Medicare
  coverage, so you can help your patients prepare
  for this important decision.

6

• Module 1 Overview

7
Medicare Prescription Drug Coverage

• Begins January 1, 2006
• Available for all people with Medicare
• Part A, Part B, or both
• For minimum standard coverage in 2006,
• enrollees would pay
• Monthly premium of about 32
• First 250 per year for prescriptions
• (deductible)
• Part of the cost of prescriptions after 250
• 5 of the drug costs (or small copayment)
• after paying 3,600 out-of-pocket

8
Savings in 2006

• On average, for a person with Medicare and no
  drug coverage now
• Total drug spending will go down by about 50
• Over 1,100 per year saved
• People with other drug coverage that, on average,
  is at least as good as the minimum standard
  Medicare prescription drug coverage also may save
  money
• These estimates do not include the extra help for
  people with limited incomes and resources

9
Protections for People with Medicare

• Customer service
• Pharmacy access
• Medication therapy management
• Generic drug information
• Privacy
• Uniform benefits and premiums
• Formulary Protections

10

• Module 2
• Extra Help for People
• with Limited Incomes
• and Resources

11
Extra Help With Drug Costs

• Available for many people with limited income and
  resources
• Those below Federal poverty level save over 95
  on average
• People with lowest income and resources
• Pay no premiums or deductibles
• Have small or no copayments
• Those with slightly higher income and resources
• Have a reduced deductible
• Pay a little more out-of-pocket

12
Eligibility for Extra Help

• Income
• Below 150 Federal poverty level
• 1,197 per month for an individual or
• 1,604 per month for a married couple
• Based on family size
• Resources
• Up to 11,500 (individual)
• Up to 23,000 (married couple living together)
• Includes 1,500/person funeral or burial expenses
• Counts savings and stocks
• Does not count home the person lives in
• Higher amounts for Alaska and Hawaii
• -Not available in
  the U.S. territories

2005 amounts
13
Automatic Eligibility for Extra Help

• Some people may automatically qualify
• People with Medicare who
• Get full Medicaid benefits
• Get Supplemental Security Income (SSI)
• Get help from Medicaid paying their Medicare
  premiums
• All others must apply

14
How to Apply For Extra Help

• Social Security Administration (SSA) is mailing
  applications to those who may be eligible
• Throughout the summer of 2005
• Those who think they may qualify should
• Complete this application
• Mail it to the address on the back of the
  application
• Use the enclosed postage-paid envelope
• Use original forms only (do not photocopy)
• People who are not sure should still apply
• www.socialsecurity.gov can help people decide

15

• Module 3
• Types of Plans/Coverage

16
Ways to Get Coverage

• Medicare prescription drug coverage is provided
  through
• Medicare Prescription Drug Plans
• Medicare Advantage and other Medicare Health
  Plans
• Coverage is NOT automatic
• People need to understand their options

17
Joining a Plan

• Join directly with the plan sponsor
• Can get help joining
• Legal representative
• Spouse, other relative, friend, or advocate
• Initial Enrollment Period

18
Late Enrollment

• Most people will have to pay a penalty if they
  wait to join
• Premium will go up 1 per month for every month
  the person was eligible but did not join
• The person will have to pay this penalty as long
  as they have a Medicare Prescription Drug Plan
• Unless they have other prescription drug coverage
  that is, on average, at least as good as the
  minimum standard Medicare prescription drug
  coverage

19
Coverage on Average at Least as Good as the
Minimum Standard Medicare Drug Coverage

• People with other coverage
• Will receive information from the other plan
• Will not pay a penalty if they wait to join
• If coverage is, on average, at least as good as
  Medicare prescription drug coverage
• Possible examples
• Some Employer Group Health Plans (EGHP)
• State Pharmacy Assistance Program (SPAP)
• Veteran Affairs (VA) coverage
• Military retiree coverage including TRICARE

20
What if a patient has prescription drug coverage
from

• A Medigap (Medicare Supplement Insurance) policy?
  
• An employer or union?

21
Original MedicareAnd Medigap With Drug Coverage

• People who have a Medigap prescription drug
  policy will receive important information in the
  mail this fall from their Medigap insurance
  company on how the new Medicare prescription drug
  coverage will affect their Medigap prescription
  drug coverage
• Choices to make
• Keep prescription coverage through the Medigap
  policy
• Join a Medicare Prescription Drug Plan after they
• Modify the Medigap policy to remove drug
  coverage, or
• Change to a Medigap policy with no drug coverage
• Drop Medigap policy and join a Medicare Advantage
  Plan or other Medicare Health Plan with
  prescription drug coverage

22
Employer/Union Coverage

• Medicare is working with employers to help people
  with Medicare keep their current prescription
  coverage
• Employer/Union options
• Offer coverage in place of Medicare prescription
  drug coverage and get a tax-free subsidy
• Offer or contract with a Medicare drug plan to
  provide prescription drug coverage
• Provide coverage that supplements the Medicare
  prescription drug coverage
• Pay all or part of Medicare drug plan premiums

23
Employer/Union Coverage

• People with Medicare and employer/union coverage
  will get important information in the mail this
  fall from their plan sponsor
• They should contact their benefits administrator
  before making any changes
• Choices to make
• Keep coverage offered by employer/union
• Join a Medicare Prescription Drug Plan
• Join a Medicare Advantage Plan or other Medicare
  Health Plan with prescription drug coverage
• NOTE If a Medicare beneficiary drops or loses
  their employer/union
• coverage, they may not be able to get
  it back

24
Medicare and Medicaid

• These people automatically qualify for the extra
  help
• They should watch the mail this fall
• Letter about choosing a Medicare Prescription
  Drug Plan
• Medicare You 2006 handbook
• Choices to make
• Compare prescription drug plan options and join
  in a plan
• If not, Medicare will enroll them in one by
  December 31, 2005
• Starting January 1, 2006, Medicare will pay for
  their prescription drugs
• Can switch to another plan at any time

25
Other State/Federal Assistance Programs

• These people automatically qualify for the extra
  help if they
• Get help from Medicaid paying their Medicare
  premiums
• Get Medicare and Supplemental Security Income
  (SSI) benefits
• They should watch the mail for Medicare You
  2006 handbook
• Choices to make
• Compare prescription drug plan options
• Find a plan that meets their needs
• If no choice made by May 15, 2006, will be
  enrolled on June 1, 2006
• Also applies to people who applied and qualify
  for extra help

26

• Module 4
• Specific Drug Coverage

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Medicare Prescription Drug Coverage

• Covers drugs available only by prescription
• Prescription drugs, biologicals, insulin
• Medical supplies associated with injection
• of insulin
• A prescription drug plan (PDP) or Medicare
• Advantage prescription drug (MA-PD) plan
• may not cover all drugs
• Brand name and generic drugs will be in
• each formulary

28
Medicare Prescription Drug Coverage Plans Must
Cover

• Cancer medications
• HIV/AIDS treatments
• Antidepressants
• Antipsychotic medications
• Anticonvulsive treatments for epilepsy and other
  conditions
• Immunosuppressants

29
Excluded Drugs

• Drugs for
• Anorexia, weight loss, or weight gain
• Fertility
• Cosmetic purposes or hair growth
• Symptomatic relief of cough and colds
• Prescription vitamins and mineral products
• Except prenatal vitamins and fluoride
  preparations
• Non-prescription drugs
• Barbiturates
• Benzodiazepines

30
Formulary

• Prescription drug plans (PDP) and Medicare
  Advantage prescription drug (MA-PD) plans may
  have a formulary
• CMS will ensure formularies do not
• discourage enrollment among certain groups of
  people
• Formulary review requirements are posted at
  www.cms.hhs.gov/pdps on the web
• CMS will approve formularies in advance for plans
  to complete their bid

31
Tiered Formularies Preferred Drug Levels

• Tier 1 is lowest cost sharing
• Subsequent tiers have higher cost sharing in
  ascending order
• CMS will review to identify drug categories that
  may discourage enrollment of certain people with
  Medicare by placing drugs in non-preferred tiers
• Plan must have exceptions procedures for tiered
  formularies

32
Exception Process

• Ensures access to medically necessary Medicare
  covered prescription drugs
• Provides process for enrollee to
• Obtain a covered Medicare prescription drug at a
  more favorable cost-sharing level
• Obtain a covered Medicare prescription drug not
  on the formulary

33
Exception Requests

• Enrollees may request an exception if
• The enrollee is using a drug that has been
  removed from the formulary
• A non-formulary drug is prescribed and is
  medically necessary
• The cost-sharing status of a drug an enrollee is
  using changes
• A drug covered under a more expensive
  cost-sharing tier is prescribed because the drug
  covered under the less expensive cost-sharing
  tier is medically inappropriate

34
Exception Procedures

• Adjudication timeframes A plan must notify an
  enrollee of its determination no later than 24 or
  72 hours as appropriate
• Failure to meet adjudication timeframes Forward
  enrollees request to Independent Review Entity
  (IRE)
• Generally, plans are prohibited from requiring
  additional exceptions requests for refills and
  from creating a special formulary tier or other
  cost-sharing requirement applicable only to
  Medicare-covered prescription drugs approved
  under the exceptions process

35
5-Level Appeals Process

• Redetermination by plan sponsor
• Reconsideration by Independent Review Entity
• Review by Administrative Law Judge
• Review by Medicare Appeals Council
• Review by Federal District Court

36
How Drug Plans Vary

• What prescription drugs are covered
• How much the individual needs
• to pay
• Which pharmacies are used
• Whether they offer more than the standard level
  of coverage
• For a higher monthly premium

37

• Module 5
• Individual Choice of a Prescription Drug Plan
  (PDP)

38
Annual Coordinated Election Period

• November 15 December 31 every year
• Person who does not have a Medicare drug plan can
  join
• Person who currently has a Medicare drug plan can
  switch
• Change effective January 1

39
Things to Consider

• What is current health insurance coverage?
• Medicare and employer/union, including military
  retiree coverage (like TRICARE)
• Original Medicare Plan
• Medicare Advantage and other Medicare Health
  Plans
• Health Maintenance Organization (HMO), Preferred
  Provider Organization (PPO), Special Needs,
  Private Fee-For-Service Plan (PFFS)
• Medicare Cost Plans
• Medicare and Medicaid
• Is there currently prescription drug coverage?
• Even those with current prescription drug
  coverage should ask
• Is Medicare prescription drug coverage right for
  me?

40
Auto-Enrollment (can change plans any time)

• Medicaid prescription drug coverage for people
  with Medicare and Medicaid ends December 31, 2005
• People with Medicare and Medicaid who do not join
  a plan by December 31, 2005
• CMS will enroll them in a prescription drug plan
  with a premium covered by the extra help
• Their Medicare prescription drug coverage will
  begin January 1, 2006
• People with Medicare and Medicaid have a Special
  Enrollment Period (SEP)
• Can change plans any time

41
Special Populations

• State Pharmacy Assistance Program participants
• People in long-term care facilities
• Residents of the U.S. territories

42
State Pharmacy Assistance Programs (SPAP)

• Provide wraparound coverage
• Provide same or better coverage and save money
• Reduce state costs or expand population served
• Costs incurred by SPAP may or may not be counted
  toward out-of-pocket limit

43
Long-Term Care Facilities

• Residents
• Obtain drug benefits from pharmacy chosen by the
  facility
• Can change plans at any time if they have both
  Medicare and full Medicaid benefits
• Will have convenient access
• Those who qualify for extra help have no
  deductibles and no copayments

44
U.S. Territories

• Each territory has its own prescription drug plan
  region
• Each territory can develop its own extra help
• Help with premiums, coinsurance, copayments,
  deductibles or
• Provide supplemental coverage

45
Information For Your Patients

• See Medicare You 2006 handbook
• To be mailed October 2005
• Read about prescription drug plans in the area
• For help in choosing a plan
• Visit www.medicare.gov on the web
• To get personalized information
• Visit www.shiptalk.org or call the local State
  Health Insurance Assistance Program (SHIP)
• For assistance with enrollment
• Call 1-800-MEDICARE (1-800-633-4227)
• TTY users call 1-877-486-2048
• Attend local community events

46
Important Dates

• May 2005
• Medicare mailed notices to people who
  automatically qualify for extra help
• Summer 2005
• Social Security Administration mails applications
  to people who may be eligible for the extra help
• July 1, 2005
• Social Security application for the extra help
  available at www.socialsecurity.gov on the web

47
Important Dates

• September 15 November 15, 2005
• Medigap insurance companies will mail information
  to Medigap policy holders who have a policy that
  covers prescription drugs
• October 13, 2005
• Begin comparing prescription drug plans
• www.medicare.gov
• 1-800-MEDICARE (1-800-633-4227)
• TTY users should call 1-877-486-2048

48
Important Dates

• October 2005
• Medicare You 2006 handbook mailed
• Medicare notifies people with Medicare and
  Medicaid of the plan they will be automatically
  enrolled in on January 1, 2006, if they do not
  enroll on their own
• Employer plans send coverage information to
  enrollees
• November 15, 2005
• Initial Enrollment Period begins

49
Important Dates

• January 1, 2006
• Medicare Prescription Drug Plan coverage begins
  for those enrolled
• May 15, 2006
• Last day of Initial Enrollment Period
• June 1, 2006
• Facilitated enrollment of people entitled to
  extra help who did not enroll by May 15, 2006

50
More Information for People with Medicare

• Websites
• www.medicare.gov
• www.cms.hhs.gov
• www.socialsecurity.gov
• Publications
• Medicare You 2006 handbook
• Facts About Medicare Prescription Drug Plans
• 1-800-MEDICARE (1-800-633-4227)
• TTY users should call 1-877-486-2048
• Social Security Administration
• 1-800-772-1213
• TTY users should call 1-800-325-0778

51
More Information for People with Medicare
Handy list of State Health Insurance Assistance
Program offices that can give your patients
expert advice on their Medicare prescription drug
coverage.
52
More Information for Health Care Professionals

• Toolkit for healthcare professionals
  www.cms.hhs.gov/medlearn/provtoolkit.pdf
• Medicare Prescription Drug Coverage Information
  for Providers Page
• www.cms.hhs.gov/medlearn/drugcoverage.asp
• Official U.S. government website for people with
  Medicare
• www.medicare.gov

53
More Information for Health Care Professionals

• Social Security Administration (SSA) posters
• Directs limited income Medicare beneficiaries
  where to call to determine eligibility for help
  with prescription drug costs
• http//www.cms.hhs.gov/medlearn/drugcoverage.asp
• Hard copies of the posters, for display in your
  office, may be ordered from the Medlearn Product
  Ordering Page
• http//cms.meridianksi.com/kc/main/kc_frame.asp?kc
  _identkc0001loc5

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Encourage Your Medicare Patients

• Learn about the Medicare prescription drug
  program by visiting www.medicare.gov on the web
  or by calling 1-800-MEDICARE
• (1-800-633-4227). TTY users should call
• 1-877-486-2048.
• Complete and mail back material that they may get
  from the Social Security Administration

55

• Thank you in advance for your help
• alerting all your patients about the
• availability of this new coverage.
• - Mark B. McClellan, MD, PhD
• CMS Administrator