www.mentalhealthpartd.org

OTHER MEDICARE PART D RESOURCES AND LINKS

THE NEW MEDICARE PART D PRESCRIPTION DRUG BENEFIT

On January 1, 2006, a monumental event will occur, affecting thousands of New Yorkers with mental illness: the advent of the Medicare Part D Prescription Drug Benefit. Created by the Medicare Modernization Act of 2003, the Part D benefit adds a prescription drug coverage component to Medicare for the first time in the program’s 40 year history.

Concerning its impact on Medicare beneficiaries with a mental illness, the Part D Benefit will offer prescription drug coverage to many who had none previously, such as those whose Social Security Disability Insurance (SSDI) income exceeded the Medicaid eligibility limit, and for whom meeting a monthly Medicaid spend-down would be prohibitive.

For other Medicare beneficiaries with a mental illness, specifically those who are dually eligible for Medicaid and Medicare, Medicare Part D will bring about significant changes and challenges, as their prescription drug coverage will switch over from Medicaid to Medicare on January 1, 2006.

The following is a basic overview of the Medicare Part D benefit, intended to assist mental health consumers, families, and providers with understanding and navigating this new benefit.

The Design of the Part D Prescription Drug Benefit
________________________________________

Unlike prescription drug coverage under Medicaid, which has one uniform plan for all its beneficiaries, Medicare Part D will feature multiple prescription drug plans sponsored by private, for-profit organizations, each with their own formularies (what drugs they will cover), premiums, co-payments, and pharmacy networks.

There are two types of Medicare Part D plans: 1) Prescription Drug Plans (PDPs), which are stand-alone plans available to beneficiaries with Original Medicare; 2) Medicare Advantage Prescription Drug Plans (MA-PDs), which are plans sponsored by managed care organizations, and combine prescription coverage with other health services. Part D participants who have Original Medicare can enroll in a PDP, while those with Medicare Advantage can enroll in an MA-PD.

Contracting with the Centers for Medicare and Medicaid Services (CMS), each Part D plan sponsor must adhere to certain conditions in order to participate. These conditions include the following:

Their formularies must include at least two drugs from each therapeutic class. For certain classes of drugs, including Antipsychotics, Antidepressants, and Anticonvulsants, CMS expects Part D plans to cover “all or substantially all” drugs in those classes.
Plans may institute benefit management tools such as Step Therapy (having to try one drug before getting access to another) and Prior Authorization (getting permission to have a drug covered). CMS expects that plans will not utilize such policies when dealing with individuals who have benefited from a drug or drugs from the above classes prior to enrollment, providing them with uninterrupted access.

Each plan must have an Exceptions & Appeals process in place for beneficiaries to access in order to request any of the following: 1) to request that a formulary drug be provided at a lower tier, thus reducing the co-payment; 2) that a drug prescribed for the beneficiary that is not on the formulary be covered by the plan.
CMS expects drug plans to have a transition plan for new enrollees, providing them with at least an initial 30-day supply of a drug they are currently prescribed if is not on the plan’s formulary, during which time the beneficiary can seek an exception to have the drug covered. Some Part D plans might have transition plans offering more than a 30-day supply.

It should also be noted that Medicare Prescription Drug Plans are not required to cover Barbiturates and Benzodiazepines, a class of drugs commonly prescribed for anxiety and acute mania. For Dual Eligibles in New York State, Medicaid will continue to cover these medications as part of a coverage Wraparound.

Beginning October 1, 2005, Part D drug plan sponsors will be allowed to market directly to Medicare beneficiaries via telephone and through the mail.
They must honor the National Do-Not-Call Registry, are prohibited from marketing via e-mail, and cannot enroll beneficiaries over the phone during marketing calls.

Since beneficiaries may be subject to marketing from over a dozen organizations, which can lead to confusion and annoyance, they may wish to have their telephone number placed on the National Do-Not-Call Registry. This can be done by calling (888) 382-1222, or by going to www.donotcall.gov .

Cost-Sharing Obligations and the Low Income Subsidy
________________________________________

Under the Medicare Part D drug benefit, beneficiaries will have certain cost-sharing obligations (see chart on next page), including monthly premiums, deductibles, prescription co-payments, and, in some cases, a coverage gap or “doughnut hole.”

For individuals with incomes below 150% of the Federal Poverty Level ($14,355 for a single person in 2005), there is what Medicare terms “Extra Help” with meeting these obligations through the Low Income Subsidy (LIS).

Overseen by the Social Security Administration (SSA), the Low Income Subsidy entirely covers the Part D annual deductible and the coverage gap for qualified beneficiaries, along with assistance meeting the monthly premiums, and reduced pharmacy co-payments.

Dual Eligibles and Partial Dual Eligibles (individuals who participate in a Medicare Savings Program that helps pay their Medicare Part A and/or B premiums) automatically qualify for the LIS, and do not need to apply. Other Medicare beneficiaries need to apply for the LIS, which can be done either at their local SSA office, or online at www.ssa.gov. For more information, call SSA at (800) 772-1213.

Please note that applying for the Low Income Subsidy and enrolling in a Medicare Prescription Drug Plan are two separate processes!

Co-Payments and Other Considerations for Dual Eligibles
________________________________________

As you will see on the chart below, Dual Eligibles will be responsible for prescription co-payments at the pharmacy.

Dual Eligibles faced pharmacy co-payments under Medicaid, but a pharmacist was obligated to fill the prescription even if the beneficiary could not meet the co-payment. Under Medicare Part D, however, a pharmacist is not obligated to fill a prescription if the beneficiary cannot meet the co-payment.

If a pharmacy is willing to waive Part D co-payments, it cannot advertise such a policy, so beneficiaries or their advocates should talk to their pharmacist about how the pharmacy will handle the issue come January 1, 2006.

In addition to the new financial obligation of mandatory prescription co-payments, the Medicare Part D benefit presents additional issues for Dual Eligibles, who previously had their prescription drug coverage through Medicaid. (Please note that the Medicare Part D Prescription Drug Benefit will not impact individuals who have just Medicaid. Their prescription drug coverage will remain under Medicaid).

* A gap in drug benefits between the initial coverage limit of $2,250, and a $3,600 catastrophic threshold, in which there is no coverage for Medicare drug plan enrollees. (Info courtesy of NAMI and NMHA)
** No monthly premium provided the beneficiary chooses a standard benefit plan whose premium is at or below the Low Income Premium Subsidy Amount, also referred to as the Benchmark Rate, which will be $29.83 in New York State for 2006.

First, Dual Eligibles will be the first group of Medicare beneficiaries who must begin utilizing the benefit on January 1, 2006. All other Medicare beneficiaries have until May 15, 2006 to enroll in a Medicare Part D drug plan. Regardless of whether they are satisfied with their prescription coverage under Medicaid, Medicaid will stop providing prescription drug coverage for Dual Eligibles on December 31, 2005.

Second, Medicare Part D is a voluntary benefit, but if a Dual Eligible in New York State affirmatively declines to participate in Medicare Part D, or disenrolls from a Part D Prescription Drug Plan without enrolling into another one, he or she will lose their Medicaid coverage as well! This is due to a New York State law requiring Medicaid beneficiaries to utilize a federal entitlement (Medicare) if they qualify for it. It is important for Dual Eligibles to understand that they must participate in Medicare Part D if they wish to retain their Medicaid coverage.

Third, as stated earlier, Medicaid will continue to play a role, though limited, in drug coverage for Dual Eligibles in NYS in the form of a Wraparound. In addition to covering Benzodiazepines and Barbiturates for Dual Eligibles, the Medicaid Wraparound will provide secondary coverage for medications not on their Medicare Prescription Drug Plan’s formulary. In order for the Medicaid Wraparound to cover a non-formulary drug for a Dual Eligible, he or she must complete at least one level of their Medicare Prescription Drug Plan’s Exception & Appeals process, and have been turned down by the plan.

Choosing a Medicare Part D Prescription Drug Plan
________________________________________

In October 2005, all Medicare beneficiaries will receive the Medicare & You 2006 handbook in the mail. The handbook will contain information on all the Medicare Prescription Drug Plans available in New York State, listing the plan sponsors, contact information, monthly premiums, deductibles, co-payments, and whether the Extra Help (Low Income Subsidy) will cover the plan’s monthly premium in full.

(Please note that the mailed Medicare & You 2006 handbook contains an error. Beginning on page 97-A, it erroneously indicates that individuals who qualify for the Low Income Subsidy will have their monthly premiums fully covered for any stand alone Prescription Drug Plan (PDP) they choose. The Low Income Subsidy will fully cover only those premiums for standard benefit plans whose premiums are at or below the Low Income Premium Subsidy Amount, also referred to as the Benchmark Rate, which will be $29.83 for 2006 in New York State.)

In New York State, there will be over 45 stand-alone Prescription Drug Plans (PDPs) available, along with - depending where a beneficiary resides in New York - a number of Medicare Advantage Prescription Drug Plans (MA-PDs) sponsored by local managed care organizations.

Since each Medicare Prescription Drug Plan will have its own unique drug formulary, co-payments (remember that Dual Eligibles and Partial Dual Eligibles will have flat co-payments for name brand and generic drugs), and pharmacy networks, beneficiaries or their advocates should consider the following questions when determining which plan best meets their needs:

Does the plan cover the medications and dosages that I am currently prescribed?
Does the pharmacy I currently use participate in the plan’s network? If not, what other local pharmacies do?
If the plan doesn’t cover one the medications I am currently prescribed, will it allow for a onetime 30-60 day supply of the medication while I apply for a coverage Exception?
What is the plan’s Exceptions & Appeals Process?
What is the plan’s monthly premium? If I qualify for the Low Income Subsidy and the premium is above the $29.83 subsidy amount or is an enhanced benefit plan, am I willing to pay the difference?
Information to assist individuals with answering these questions can be obtained through a variety of means. They can call the Medicare Prescription Drug Plans directly, and request information on the plans, including their formularies. They can contact Medicare via telephone at (800) 633-4227, or go to www.medicare.gov , which will feature an interactive Formulary Finder and a Prescription Drug Plan Comparison Tool. The Formulary Finder can help beneficiaries identify the Medicare Prescription Drug Plan that best covers their current prescription drug regimen.

Enrolling in a Medicare Prescription Drug Plan
________________________________________

The Initial Enrollment Period for Medicare Part D will begin November 15, 2005. As stated earlier, Dual Eligibles will be the first Medicare beneficiaries who must enroll in a Part D plan. At the end of October 2005, Medicare will begin sending notices to Dual Eligibles informing them that a Medicare Prescription Drug Plan has been selected for them. This is also referred to as auto-enrollment, and is being done to ensure that Dual Eligibles have prescription drug coverage when their Medicaid drug coverage ceases on December 31, 2005.

Beginning November 15th, Dual Eligibles will have the opportunity to choose another Medicare Prescription Drug Plan if they are dissatisfied with the one Medicare has selected for them. In fact, Dual Eligibles can change plans at any time. If they do nothing by December 31, 2005, the plan Medicare has selected for them will begin providing their prescription drug coverage on January 1, 2006.

Other Medicare beneficiaries have until May 15, 2006, to enroll in a Part D plan. After this date, Medicare beneficiaries who do not have prescription drug coverage that is at least as good as Medicare Part D (also referred to as Creditable Coverage) or who do not enroll when they are first eligible, will face a 1% premium penalty (based on the national average premium) for every month they delay enrollment in Medicare Part D.

For example, if a current Medicare beneficiary without creditable drug coverage waits 18 months after the May 15, 2006 deadline to enroll in a Part D plan, and if the average national premium for 2007 is a hypothetical $36, they will have to pay a 18% ($6.48) monthly penalty on top of their plan’s monthly premium. This is a lifetime penalty. Beneficiaries with the Low Income Subsidy whose incomes are below 135% of the Federal Poverty Level would pay just 20% of the premium penalty (approximately $1.30 using the example on the left) for a 5 year period.
Medicare beneficiaries with drug coverage from another source, such as the VA, a union, or an employer, will receive a notice from that organization informing them whether their coverage is creditable.

Beneficiaries can enroll in a Medicare Prescription Drug Plan through a variety of methods. They can submit a paper enrollment form by mail or by fax to the plan’s sponsor. They can call enroll over the phone, and some plans will provide for online enrollment through their website. Beneficiaries can also enroll directly through Medicare at the www.medicare.gov website, or by calling (800) 633-4227.

Additional Information on Medicare Part D

Common Medicare Part D Terms:

Auto-enrollment – the process by which Medicare will select a Part D Prescription Drug Plan for Dual Eligibles. The plan Medicare selects for Dual Eligibles will be a random one, and will not take the individual’s current prescription drug regimen into account. If a Dual Eligible does not like the Medicare Prescription Drug Plan selected for them, they can choose another plan beginning November 15, 2005. If they do nothing by December 31, 2005, the Medicare Prescription Drug Plan chosen for them will begin providing their prescription drug coverage on January 1, 2006. In order to ensure that there is no interruption in their prescription drug coverage and for the sake of convenience, Dual Eligibles who wish to disenroll from a plan should do so by contacting the new plan they wish to enroll in, since enrolling in a new plan automatically disenrolls them from the old one.

CMS – Acronym for the Centers for Medicare and Medicaid Services, the Federal agency that oversees Medicare and the Part D Prescription Drug Benefit.

Dual Eligible – an individual who is eligible for both Medicaid and Medicare. On January 1, 2006, prescription drug coverage for Dual Eligibles will switch from Medicaid to Medicare Part D. Dual Eligibles automatically qualify for the Low Income Subsidy (LIS), and Medicare will select a Prescription Drug Plan for them (auto-enrollment). Dual Eligibles can change Medicare Prescription Drug Plans at any time, with the new coverage taking effect the beginning of the following month.

Formulary – A list of drugs that a Medicare Prescription Drug Plan will cover. Plans must cover at least two drugs from each therapeutic class, and for the Antipsychotic, Antidepressant, and Anticonvulsant classes, they must cover “all or substantially all” drugs contained in those classes. Medicare Prescription Drug Plans may utilize benefit management tools such as Step Therapy (having to try one drug before getting access to another) and Prior Authorization, but CMS expects that these methods will not be used by plans when dealing with beneficiaries who have been stabilized on a drug or drugs from the Antipsychotic, Antidepressant, and Anticonvulsant classes.

Formulary Finder – an online tool available at www.medicare.gov intended to assist Medicare beneficiaries with determining the Medicare Prescription Drug Plan(s) that best meet their needs. Beneficiaries can enter the prescription drugs they are currently taking (with or without dosages), and the Formulary Finder will identify the Medicare Prescription Drug Plans that best covers their current medication regimen.

Initial Enrollment Period – the initial period during which current Medicare beneficiaries can enroll in a Medicare Part D Prescription Drug Plan, which will be from November 15, 2005 to May 15, 2006.

The only exception to this is for Dual Eligibles, who must begin utilizing a Medicare Prescription Drug Plan on January 1, 2006. In future years, Medicare beneficiaries who are neither Dual Eligibles nor Partial Dual Eligibles will be able to change plans generally only one time per year during the Annual Coordinated Enrollment Period, which will be between November 15th and December 31st of each year.

Low Income Subsidy – the “Extra Help” provided Medicare beneficiaries with incomes below 150% of the Federal Poverty Level. Overseen by the Social Security Administration, the Low Income Subisdy (LIS) provides assistance in meeting the cost-sharing obligations of the Medicare Part D Prescription Drug Benefit, such as deductibles, monthly premiums, prescription co-payments. Dual Eligibles and Partial Dual Eligibles automatically qualify for the LIS and do not need to apply. Other beneficiaries must apply for the Low Income Subsidy, which can be done at their local SSA office, by mail, or online at www.ssa.gov . For additional information, call (800) 772-1213.

MA-PD – acronym for Medicare Advantage Prescription Drug Plan. MA-PDs are sponsored by local managed care organizations, and combine prescription drug coverage with other health services. Individuals who have Medicare Advantage can enroll in an MA-PD. Medicare beneficiaries cannot mix and match a Medicare Advantage health plan with a stand alone Prescription Drug Plan (PDP), and vice versa. The MA-PDs available to choose from depends on the area of New York State in which the beneficiary resides.

Partial Dual Eligible – an individual who participates in a Medicare Savings Program that assists them with paying their Medicare premiums. These Medicare Savings Programs include the Qualified Medicare Beneficiary Program (QMB), the Specified Low Income Medicare Beneficiary Program (SLIMB), and the Qualified Inidividual-1 (QI-1) Program. Partial Dual Eligibles automatically qualify for the Low Income Subsidy and do not need to apply. They have from November 15, 2005 to May 15, 2006 to enroll in a Medicare Prescription Drug Plan. If they do not choose a plan by the end of that period, Medicare will select one for them (facilitated enrollment), with coverage beginning June 1, 2006. Partial Dual Eligibles can change Medicare Prescription Drug Plans at any time.

PDP – acronym for Prescription Drug Plan. PDPs are stand-alone drug plans (i.e. they do not include health coverage) sponsored by private, for-profit organizations who have contracted with CMS to participate in the Medicare Part D Prescription Drug Benefit. Individuals who have Original Medicare can enroll in a PDP. For 2006, there will be 46 PDPs available statewide in New York.

SSA – acronym for the Social Security Administration. The SSA oversees the Low Income Subsidy component of the Medicare Part D Prescription Drug Benefit.

Wraparound – the term commonly used for the supplemental (secondary) prescription drug coverage that will be available to Dual Eligibles in New York State through Medicaid. The Wraparound will provide supplemental coverage under two situations: 1) it will provide coverage for Benzodiazepines and Barbiturates, two classes of drugs that Medicare Prescription Drug Plans are not required to cover; 2) it will cover drugs not a Dual Eligible’s Medicare Prescription Drug Plan’s formulary, but only after a Dual Eligible has requested a coverage exception from the Medicare Prescription Drug Plan.

Medicare Part D Timeline
2005

October 1 – Medicare Part D plans can begin marketing directly to beneficiaries.

October 7-20 – CMS mails Medicare & You 2006 to all Medicare beneficiaries. This handbook will contain information on all the Medicare Prescription Drug Plans available in the New York State.

October 13 – CMS makes online Part D Prescription Drug Plan Comparison Tool and Formulary Finder available at www.medicare.gov . Assistance will also be available via phone at (800) 633-4227.

Late October – Early November – CMS mails notifications to Dual Eligibles, informing them that Medicare has selected a Prescription Drug Plan for them (Auto-Enrollment), and that they can choose another Medicare Prescription Drug Plan if they are not satisfied with the one selected for them beginning November 15th. If they do nothing by December 31st, the plan Medicare has chosen for them will begin providing their prescription drug coverage on January 1, 2006.

November 15 – Initial Enrollment Period for Part D plans begins for all beneficiaries. Dual Eligibles can elect to disenroll from the Medicare Prescription Drug Plan selected for them, but must enroll into another one. Dual Eligibles can change Medicare Prescription Drug Plans at any time. Non-Dual Beneficiaries have until May 15, 2006 to enroll in a Medicare Prescription Drug Plan.

December 31- Prescription drug coverage under Medicaid ends for Dual Eligibles.

2006

January 1 – Part D prescription drug coverage begins for Dual Eligibles, and for Non-Duals who have enrolled in a Part D plan.

May 15 – Initial Enrollment Period ends.

HOME