Transcript Medicare Part D: What Now, What Next?

Medicare Part D: What Now, What Next?
CMS Continues to Improve Part D
November 5, 2007
Medicare Part D Panel Briefing
sponsored by
The Commonwealth Fund
Tracey McCutcheon, MHSA, MBA
Deputy Director,
Medicare Drug Benefit Group
2007 Enrollment by Benefit Type
 Beneficiaries
are selecting
alternative
design plan
types.
Enhanced Alternative
100%
80%
60%
40%
Basic Alternative
Actuarially Equivalent
Standard
Defined Standard
Data as of Jan07
Analysis excludes FBDE & LIS
20%
0%
PDP
MAPD
2007 Enrollment by Deductible
Category
 Beneficiaries
are selecting
plans with no
deductible.
100%
80%
60%
40%
$265
$1 - $264
$0
20%
0%
Data as of Jan07
Analysis excludes FBDE & LIS
PDP
MAPD
2007 Enrollment by Premium
Category
 Beneficiaries
are selecting
plans with
low or no
premiums
100%
80%
60%
40%
$32.20 and above
$0.01 - $32.19
$0
20%
0%
Data as of Jan07
Analysis excludes FBDE & LIS
PDP
MAPD
2007 Enrollment by Gap Coverage
 Coverage in
the gap is not
a significant
factor in plan
selection.
100%
80%
60%
40%
All Formulary Drugs
Generics & Brands
Generics & Preferred Brands
20%
Generics
None
0%
Data as of Jan07
Analysis excludes FBDE & LIS
PDP
MAPD
2008 Costs Continue to be Lower
than Expected
 Fewer Part D plans offerings in 2008 than 2007
– Plan offerings within a sponsor have more meaningful
differences
 Overall, premiums will be stable for many
beneficiaries but slightly higher for some
– 2008 standard average premium is $25 for basic
coverage
 Slow growth in Rx drug costs
– Increased generic use
– Effective plan negotiation
– Competition
Beneficiaries Continue to Have
Multiple Low Cost PDP Choices
 More than 90% of beneficiaries in stand-alone PDPs will
have access to a plan in 2008 with premiums lower than
they paid in 2007.
 In every state, beneficiaries will have access to at least
one PDP with premiums of less than $20, and a choice of
at least 5 plans with premiums of less that $25 a month.
 Beneficiaries in all states have access to a PDP with no
drug deductible for a premium of less than $26 per
month.
 Beneficiaries in all states have access to PDP plans with
coverage in the gap for generic drugs for under $50 a
month.
Beneficiaries Have Even Lower
Cost MA-PD Choices
 There are more MA-PD health plan offerings in
2008 than in 2007.
 MA-PD premiums will average $11 lower than
premiums for PDPs in 2008 (vs. $7 lower in
2007).
 Over 90% of people with Medicare will have
access to a MA-PD for a $0 premium and with a
$0 drug deductible.
Highlighted Improvements for
2008
 Benefit and Formulary Reviews
– Enhanced specificity in PBP software
– Negotiation of meaningful differences & outliers
 Systems Improvements
–
–
–
–
LIS data exchanged among CMS, States and SSA
Ability to correct data in CMS systems
“4Rx” data mandatory on plan-generated enrollments
Automation of plan TrOOP balance transfer processes
 Performance Metrics
– Additional measures developed
– Increased transparency through integration with Drug
Plan Finder
More Robust Formulary Reviews
 Prevent discrimination against beneficiaries by age,
disease, or setting (e.g. long-term care)
 Utilize reasonable benchmarks to check that drug lists
are robust
 Review tiering and utilization management strategies
 Identify potential outliers at each review step for further
CMS investigation and obtain reasonable clinical
justification when outliers appear to create access
problems
 Ensure minimum transition coverage policies
2007 vs. 2008 Formularies (PDP)
16%
14%
12%
10%
8%
6%
4%
2%
0%
2007
Average Percent
of Reference
NDCs with Prior
Authorization
2008
Average Percent
of Reference
NDCs with Step
Therapy
Average Percent
of Reference
NDCs with
Quantity Limits
Note: Adjusted for drugs comparable on both the 2007 and 2008 Medicare Formulary
Reference Files.
2007 vs. 2008 Formularies (PDP)
1,100
2007
2008
1,075
1,050
1,025
1,000
Average Number of Reference NDCs on Formulary
Note: Data limited to plans offered both in 2006 and 2007. Excludes employer
sponsored plans. Formulary data from 2006 as of 4/20/2006, and 2007 as of 7/5/2006.
The Power of Part D Performance
Metrics
 Establishes performance benchmarks:
– CMS’ long-term goal is to establish performance
benchmarks based on historical experience with Part D
– Once benchmarks are established, CMS will work with
plans to improve performance
– If high performance in an area becomes standard for
all plans then a measure may be retired
 CMS will have composite scores for monitoring
purposes beginning Nov. 15, 2007.
 Creates a feedback loop
Example: Monitoring of Drug
Pricing
 CMS has a current performance metric to
measure drug price changes.
 The average drug increase in the CPI (Feb. –
Aug. 2006) was 5%.
 13% of PDP drug prices exceeded the CPI
increase.
 Plans were given a high rating if they had a
lower percentage (<22%) exceeding the CPI.
 Plans were given a low rating if they had a
higher percentage (>33%) exceeding the CPI.
– 7 PDPs and 34 MA-PDs received low ratings (1 or 2
stars).
Performance Measure in MPDPF –
Domain Level
Plan
Prescription Drug Plan A
Prescription Drug Plan B
Prescription Drug Plan C
Show all categories
Performance Measures
Customer Service
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View Details
Access to
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Prescription Drugs
View Details
Drug Pricing and
Utilization
View Details
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Performance Measure in MPDPF
– Measures Level
Plan
Prescription Drug Plan A
Prescription Drug Plan B
Prescription Drug Plan C
Show all categories
Customer Service
Customer Service
Wait Time
Customer Service
Disconnect Rate
Pharmacy Help
Desk Average Wait
Time
Pharmacy Help
Desk Average
Disconnect Rate
Beneficiary
Understanding of
Drug Costs and
Coverage
Beneficiary Ability
To Get Help From
The Plan
Beneficiary Rating
of Plan
Total Customer
Service
Complaints
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Performance Measure in MPDPF
– Data Level
Plan
Prescription Drug Plan A
Prescription Drug Plan B
Prescription Drug Plan C
Show all categories
Customer Service
Customer Service Wait
Time
4 min 20 sec
2 min 10 sec
38 sec
Customer Service
Disconnect Rate
6%
5%
3%
Pharmacy Help Desk
Average Wait Time
Pharmacy Help Desk
Average Disconnect
Rate
Beneficiary
Understanding of Drug
Costs and Coverage
Beneficiary Ability To
Get Help From The
Plan
Beneficiary Rating of
Plan
Total Customer Service
Complaints
4 min 37 sec
2 min 3 sec
40 sec
7%
6%
1%
40%
65%
80%
86%
68%
95%
88%
93%
85%
1.9
1.6
0.6
View Details
LIS-Eligible Beneficiaries and
Reassignment
 CMS re-assigns LIS eligible beneficiaries who are
enrolled in plans that will no longer have a
premium within a $1.00 of LIS premium subsidy
benchmark
– Also to those whose plans are leaving Medicare
program
 No major problems in 2007
 For 2008, 1 in 6 dual eligible beneficiaries may
switch to a new plan to avoid a premium increase
LIS Outreach to Those Who Will
Face a Change in 2008
 Re-assignment Notices (blue) provide information
on:
1. Moving to the new plan
2. Staying in the current plan
3. Selecting a different plan
 New “Chooser” Notices (tan) provide information
on:
1. Premium responsibility for 2008
2. Zero premium plans available
3. Evaluating plan options
LIS Outreach to Those Who
Haven’t Applied for Extra Help
“The Community is Coming Together”
LIS national kick-off and partner meetings
Data-sharing for targeting outreach
New materials – “Photo novellas”
Stronger partnerships
Community outreach