Medicare Compliance & Reimbursement

McClellan: Coverage continuity for duals a priority during switch.

Without a transition period of at least six months, the poorest and most vulnerable seniors and disabled people may suffer when their pharmaceutical coverage shifts from Medicaid to Medicare on Jan. 1, 2006.

That message was voiced repeatedly, from both sides of the dais, at a March 3 hearing on the needs of Americans eligible for both programs. The so-called dual eligibles often have several chronic illnesses requiring multiple medications, and advocates fear that they will suffer potentially disastrous discontinuities in care if they are switched too quickly into privately run Medicare prescription drug plans with closed formularies.

But the hearing also featured a second message regarding adding a transition period and other protections for the so-called dual eligibles: Ain't gonna happen.

"I'll be honest with you - that is a tall order," said Senate Aging Committee Chair Gordon Smith (R-OR), referring to the possibility that the Senate might pass legislation modifying the new drug benefit before it takes effect. "I think the Bush administration, perhaps a majority in Congress, and many in the leadership of Congress want to see what the problems are before we start promoting fixes."

Centers for Medicare and Medicaid Services Administrator Mark McClellan, the hearing's lone optimist, said his agency was "implementing protections to ensure that no dual eligible beneficiary has any gap in their drug coverage." For example, he announced that CMS would have a system in place by Jan. 1 to allow any Medicare beneficiary to fill a prescription at a pharmacy by giving his or her name and date of birth, even if the beneficiary did not have a drug card and could not remember the name of his or her PDP.

McClellan also noted that duals would be auto-enrolled in the Medicare drug benefit and the substantial low-income benefits available. He said CMS will tell dual-eligibles by early fall what plans they will be assigned to if they do not choose one on their own, and will notify plans so that they can help in the transition.

CMS will require each PDP to submit a transition plan for moving enrollees currently taking a non-formulary drug to a medication that is on the list, McClellan said. He noted that models for successful transitions can be found in the Federal Employees Health Benefits Plan, in employer-based retiree health plans, and indeed in Medicaid managed care plans.

The most common approach is to provide a one-month supply of the old drug while the plan manages the move to the new drug, McClellan said, although this would not be required. As part of its transition plan, a PDP might contact the dual-eligibles who are assigned to it in October, providing a three-month window to work out any needed switches, the administrator explained.

... Others Unsure If CMS Can Deliver

The three other witnesses at the hearing all praised CMS' efforts: For example, Tina Kitchin, MD, medical director of Oregon's Department of Human Services, characterized them as "heroic." Nevertheless, she said, "Oregon continues to have some significant concerns."

Starting in October, duals are going to have to "compare their current medications to brand-new formularies" and "their current pharmacies to brand-new networks of pharmacies," said Kitchin. Since many duals suffer from mental illness, dementia, brain injury and other functional limitations, they will need help, and in Oregon "I don't know how we are going to do it in the timeframe."

When Oregon moved its Medicaid beneficiaries into mandatory managed care, "it took the state well over a year of planning, plus then a year to roll out the process," Kitchin said. "I think those choices were small compared to the choices that beneficiaries are going to be faced with this year."

Kitchin expressed concern that CMS' regulations requiring transition plans are mostly devoid of details and specifics. "I know that ... in Oregon, we have plans that go above and beyond what is required, but we also have plans where it's a struggle to get them to do the minimum," she explained

Kitchin pointed to another reason it might be difficult to get PDPs to behave in desirable ways: Managed care works best when "plans are at risk if they deny a cheaper service and someone goes in for a more expensive service, whereas these new drug plans are only at risk for the cost of the medications."