Transcript Medicare Part D Update Presentation

Federal Medicare Prescription
Drug Coverage:
Impact on Medicaid Beneficiaries
Trey Berndt
Senior Policy Advisor, Office of Health Services
What is Dual Eligibility?
• Dual Eligibility refers to individuals who are:
 Medicare eligible (aged or disabled);
 Low income; and
 Also eligible for some level of Medicaid coverage
• There are different types of dual eligibility, but
generally, they fall into two categories:
 Full dual eligibles
 Other dual eligibles
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Dual Eligibility, Continued
• Full Dual Eligibles:
 Entitled to Medicaid benefits that Medicare does not cover,
including Medicaid drug coverage
 Include low-income aged and disabled individuals in Medicaid
community care programs, nursing homes, and state schools
• Other Dual Eligibles:
 Eligible only for Medicaid payments for Medicare premiums,
deductibles, and coinsurance for Medicare services
 Not entitled to Medicaid prescription drugs services
 Include several categories of eligibility; incomes generally up
to 135% of federal poverty level (if not in institution)
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What is Medicare Part D?
(It’s Not the Discount Card Program!)
New Medicare Rx coverage; starts January 2006
• New “Part D” offers optional drug coverage to all
Medicare beneficiaries
• Rx coverage provided through private drug plans or
Medicare HMOs (Medicare Advantage)
• Limited to private plan’s formulary
• Medicare beneficiaries with Medicaid Rx coverage
(full duals) must switch to Medicare Part D
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How Does Medicare Part D Change
Medicaid Rx?
Medicaid Rx changes effective January 1, 2006
• New law prohibits states from drawing federal
Medicaid funds for drugs for dual eligibles
• Medicaid Rx coverage for dual eligibles will be
discontinued 1/1/06
• Medicare will auto-enroll dual eligibles into Part D
plans
• States make monthly payment to Medicare
(clawback)
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Who is Affected?
What Do They Need to Do?
Medicare Eligible
Group
Full Dual Eligibles
(Medicare & Full Medicaid)
Other Dual Eligibles
(Medicare and Limited
Medicaid)
Low Income
Medicare-Only
(135%-150% FPL)
Medicare-Only
(Over 150% FPL)
Change
Part D Action
Needed?
-Medicaid Rx ends
-Auto-assigned to a
Medicare Part D plan in
October 2005
-Evaluate autoassigned plan and
formulary
-Change plans?
-No Medicaid Rx now
-Gain Medicare Part D
-Auto-assigned in June
2006
-Enroll in Part D plan
earlier than autoassignment date?
-Change plans?
-Gain Medicare Part D
-Coverage through PDP
or MA-PD
-Enroll in Part D Plan?
-Apply for Low Income
Subsidy
-Gain Medicare Part D
-Coverage through PDP
or MA-PD
-Enroll in Part D Plan?
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What Medicaid Drug Coverage Continues
for Full Dual Eligibles?
 Medicaid continues to pay cost sharing for Medicare Part B
covered drugs
 Medicaid will continue to pay for a few categories of drugs
not covered by Part D (wrap around):
• Nonprescription drugs (over-the-counter
medications).
• Barbiturates
• Benzodiazepines
 Medicaid cannot pay for a drug whose category is included
in Part D, but not covered by a particular plan’s formulary.
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How Many Medicaid clients are affected?
(as of 5/1/05)
Full Dual
eligible clients:
In nursing facilities
In State Schools
In community based ICFs/MR
Total in institutions
Total in the community
Total full dual eligibles
56,842
3,454
4,064
64,360
253,390
317,750
Non-Full Dual
In nursing facilities
417
Eligible Clients: In state schools
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In community-based ICFs/MR
17
Total in institutions
440
1929B clients
47,142
Other clients (QMB,SLMB,QI-1) 120,006
Total non-full duals
167,588
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How Does Part D Coverage Work for Higher
income Medicare Beneficiaries?
(Not Dual Eligible; Over 150% FPL; Not in Medicare HMO)
Standard Benefit (Beneficiaries pay monthly premiums
(estimated at $35 in 2006)
• Based on annual amount of drug costs, beneficiaries may
pay a significant portion:
 Deductible (first $250 of drug costs)
 25% of drug costs between $250 and $2250
 100% of drug costs between $2250 and $5100 (no
Medicare coverage = “gap”); premiums continue
 Copayments or 5% of drug costs after $5100;* Medicare pays
95%
 Enrollment in Medicare Managed Care may lower these out
of pocket costs
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*At $5100 of drug costs, beneficiary has paid $3600 in out-of-pocket spending, not including
premiums
Cost Sharing - Standard Benefit
Example A
(Not Dual Eligible; Over 150% FPL; Not in Medicare HMO)
Standard Benefit – $250 per month($3000 annually) in Drug Costs
Total Out of Pocket = $1500 (50%);Does not include premiums
$250
Monthly $200
out-of$150
pocket
spending
$100
$50
Dec
Nov
Oct
Sept
Aug
July
June
May
April
March
Feb
Jan
$0
These costs do not apply to beneficiaries with low-income subsidy.
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Cost Sharing - Standard Benefit
Example B
(Not Dual Eligible; Over 150% FPL; Not in Medicare HMO)
Standard Benefit – $500 per month ($6000 annually) in Drug Costs
Total Out of Pocket = $3645 (61%);Does not include premiums
Monthly
out-ofpocket
spending
Dec
Nov
Oct
Sept
Aug
July
June
May
April
March
Feb
Jan
$500
$450
$400
$350
$300
$250
$200
$150
$100
$50
$0
These costs do not apply to beneficiaries with low-income subsidy.
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Part D Low-Income Subsidies
(Full duals, Other duals, Low Income Medicare-only)
• Subsidies eliminate or lower premium, out-of-pocket
cost sharing for low income beneficiaries
• Based on Income and Asset Test
• Premium subsidies–
 No premiums or deductibles for all dual eligible Medicaid
clients and some low income, Medicare beneficiaries
 Sliding scale subsidies for other low income beneficiaries
• Cost sharing subsidies No gap in coverage for all dual eligible Medicaid clients
and some low income Medicare-only individuals
 Copays from $1 to $5 for all dual eligibles and some low
income Medicare-only individuals
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Low-Income Subsidy Groups
Population
Premium &
Deductible
Cost Sharing
Catastrophic
coverage
Full and Non-Full
Duals
No premium
No deductible
•Less than 100% FPL,
$1-$3 (generic/brand)
•Over 100% FPL,
$3-$5 (generic/brand)
No copay after
total drug
expenses reach
$5,100 in 2006
Dual eligible clients
in institutions
No premium
No deductible
No cost sharing
No cost sharing
New low-income
subsidy groups:
-no premium
-no deductible
•$2-$5 cost sharing
(generic/brand)
No copay after
total drug
expenses reach
$5,100 in 2006.
-sliding
premium
-$50
deductible
• 15% of the cost of the
covered drug
• Up to 135% FPL
•135% to 150% FPL
$2 generic and
$5 brand
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Federal Responsibility:
Dual Eligibles’ Drug Coverage
• Medicare assumes financial responsibility for Medicaid full
dual eligible drug coverage in January 2006.
• Medicare program will assign full dual eligibles to a Part D
plan in October 2005. Beneficiaries can pick a new plan. If
they do nothing, beginning Jan. 1, 2006, Rx coverage is
with plan Medicare assigned.
• State must discontinue Medicaid drug coverage for full
dual eligibles at the end of December 2005.
• No federal Medicaid funding for Part D-covered drugs for
full dual eligibles after that date (except a few limited
categories), even if not enrolled in a Part D plan.
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HHSC Communications Strategy:
“What happened to my Medicaid Drug Coverage?”
• Beneficiaries most likely source of info on Medicare
Part D: (source: Kaiser Family Foundation Focus Groups)
 Medicare
 Pharmacists
 Physicians
• HHSC also knows (for dual eligibles):
 who they are
 where they live
 Most go to the pharmacy to get their prescriptions filled
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HHSC Communications Plan:
Target Audiences
• Clients
 Full Dual Eligibles
 Non-Full duals
 Medicare-only clients in state-funded Rx programs
(Kidney Health, New Generation mental health medications,
HIV/AIDS)
• Providers
 Pharmacists
 Physicians
 Institutional providers (Nursing homes, ICF/MRs)
• HHS Staff, Stakeholders,
 Caseworkers and other front-line staff in all HHS agencies
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HHSC Communications Strategy
Materials and Activities
Provider-Directed Activities
• Education
 Articles for newsletters
 Briefings for members
 Training materials
• Materials (based on available funding)
 High interest direct mail
 Push cards
 Brochures
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Medicare Part D: Key Dates in the
Implementation Timeline
•
•
•
•
Jan 2005
July 1, 2005
September 2005:
October 2005:
•
October 15, 2005:
•
October 15, 2005:
•
November 15, 2005
•
December 31, 2005:
•
•
December 31, 2005:
January 1, 2006:
Final rule due from Medicare.
States begin providing assistance for subsidy application.
awards bids to PDPs and MA-PDs
Medicare notifies full dual eligibles of plan assignment.
States will also be notified of plan assignments.
Medicare disseminates information comparing
Part D plans via mail and 1-800-Medicare
Deadline for Medicare to notify states of their
annual per capita drug payment amounts for 2006.
Enrollment period for Part D plan selection
opens (runs through May 15, 2006 in first year only).
Medicaid prescription drug coverage for dual eligibles
ends.
Medicare discount card program ends
Medicare Part D drug coverage program begins
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What Should
Stakeholders/Providers do to Get
Ready for Medicare Part D?
• May 2005: Who and where are your Medicare
clients? Who is full dual eligible/other dual eligible?
Who is Medicare-only?
• Early Summer 2005: Watch for more information and
communications materials (HHSC, Medicare, TMA,
other sources)
• September – October 2005: Learn who new
Medicare Part D Plans are (stand alone drug plans
and Medicare HMOs); Review their formularies,
contact information for patient coverage problems.
• November-December 2005 and ongoing – Check for
Part D Coverage for duals and Medicare-only.
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Support Part D enrollment on an ongoing basis.