Medicare Compliance & Reimbursement

Move to Medicare drug coverage confusing beneficiaries.

Provisions of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 that will take effect on January 1, 2006, could jeopardize access to needed medications for the 6.4 million dual eligibles who are enrolled in both Medicare and Medicaid.

This is the conclusion of a Medicare Rights Center report entitled, "Undermining Stability: The Plight of Mentally Ill Americans Under the 2006 Medicare Drug Benefit," issued in August. The study highlights sections of the Medicare drug law that present new opportunities and challenges for poor and low-income older adults and persons with disabilities to obtain crucial psychiatric medications under the new Part D benefit. 

The report notes that one in five older adults and over half of younger people eligible for Medicare due to a disability have mental or cognitive impairments. Nearly 40 percent of dual eligibles - 2.5 million individuals - have a cognitive or mental impairment, for whom Medicaid currently covers drugs. Beginning next year, the MMA ends Medicaid drug coverage for dual eligibles and moves them into the new Medicare drug benefit.

The Medicare Rights Center has identified three primary objectives that policy makers, health care officials and legislators should consider to preserve dual eligibles' access to appropriate psychiatric medications:
   Medicare drug plans' coverage of the full range of mental health medications without overly restrictive benefit management practices.
   Continuity of care during the transition process.
   Greater participation in the low-income subsidy. The authors argue that the transition process could cause harmful disruptions in care for Medicare consumers with mental illness. They see the current enrollment timeframe as being far too short to implement the extensive systems changes and the education efforts needed to move millions of individuals to Medicare plans and ensure they understand the extent of the coverage changes. As a result, large numbers of dual eligibles with mental illnesses could experience gaps in coverage, at least initially, and end up without coverage when their Medicaid coverage ends.

Another serious concern is that Medicare coverage for psychiatric medications may be far more restrictive than many Medicaid programs. Because mental health medications, even within the same class, are not interchangeable, most Medicaid programs cover the full range of mental health medications an individual may need. Private sector Medicare drug plans and Medicare Advantage plans will have incentives to use restrictive benefit management practices to limit coverage of new, generally more effective medications, because they cost more than older drugs for the same conditions.