Medicare Part D. Tracy Foster. Senior Vice President, Policy Strategies

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1 Medicare Part D Tracy Foster Senior Vice President, Policy Strategies

3 Medicare Part D 3 Key Points of Understanding #1 Complex benefit structure #2 Number of plan options #3 Financial assistance available at no cost to lower income beneficiaries Copyright 2006 Lash Group All rights reserved. 3

4 #1 Complex Benefit Structure Premium - monthly amount of money a beneficiary pays for coverage Deductible - annual amount of money a beneficiary must pay out of pocket before they receive health plan benefits Tiered formularies with associated costs Copayments - a fixed dollar amount per tier Examples include: $15, $25, $35 Coinsurance - a percentage of cost Example includes: 25% Coverage gap - the period in which beneficiaries are responsible for 100% of part D drug costs.* Catastrophic coverage - coverage provided when a person's prescription drug expenses exceed a set level** established by the federal government. At this level, the most assistance is provided to beneficiaries and the government pays up to 95% of any additional expenses, with no upper limit. Beneficiary pays 5% of prescription drug costs. *When drug costs exceed $2,250 but less than $3,600 (2006), $3,850 (2007) **$3,600 out-of-pocket in 2006, $3,850 in Copyright 2006 Lash Group All rights reserved. 4

5 #2 - Number Of and Variation Among Plan Options Benefit structure (premiums, deductibles, copays, cost-sharing, gap coverage) Formulary (what drugs are covered) Utilization restrictions (prior-authorization, appeals processes) Copyright 2006 Lash Group All rights reserved. 5

7 #3 Financial Assistance Available Low Income Subsidy (LIS) is available to help Medicare beneficiaries who have limited income and resources pay for Medicare Part D prescription drug coverage LIS is often referred to as extra help For most patients qualifying for LIS No premium, no deductible Copay $1(generic) - $5 (brand) No coverage gap No cost sharing under catastrophic coverage Financial qualifications Qualifications vary and relate to more/less robust assistance Most generous criteria: Income <=150% FPL (14,700 for single, $19800 for couple) Assets <=$10,000 for single, $20,000 for couple Some beneficiaries are automatically eligible for assistance Full-benefit, dual-eligible individuals (people with Medicare and full Medicaid) Medicare beneficiaries that receive Supplemental Security Income (SSI) Medicare beneficiaries that are part of a Medicare Savings Program Copyright 2006 Lash Group All rights reserved. 7

8 The Medicare Part D Experience 2006 Highlights Enrollment After 6 months of open enrollment (from November May) 23.8 million beneficiaries were reported as enrolled in a PDP or MA-PDP plan (June 2006) Launch. Overwhelming number of plan options and complicated plan designs Long hold times at payers. Some pharmacists reported 2-3 hour hold times in Jan Progress? By May 2006 Payer hold times were no longer an issue. Polls revealed that most seniors felt the process for enrolling in Part D plan was not difficult and saved them money As of June 2006, CMS identified approximately 3.25 million potential LIS eligible had not yet applied for LIS. Sept 22, 2006 National Donut Hole Day Many negative reviews published on donut hole day explaining that beneficiaries cannot afford prescriptions. Some beneficiaries said they stopped taking certain medications due to cost. Many seniors are shopping around for best price when they meet donut hole. However, polls say many seniors are saving money overall and very happy with Part D. Providers are not hearing that Part D is a problem for beneficiaries. Copyright 2006 Lash Group All rights reserved. 8

9 Key Learnings 1. Many beneficiaries and advocates were not well prepared to successfully navigate the plan assessment and selection process. 2. It is important to understand the donut hole or coverage gap. 3. Beneficiaries who may qualify for the LIS should apply. Online for immediate determination, at SSA office, via paper application. 4. There are solutions for beneficiaries at low to middle incomes to address affordability issues. While patients can t buy supplemental insurance for Part D, Patients can/should review plan selection to see if higher premium plan can reduce cost sharing in donut hole. Patients at moderate incomes may qualify for supplemental coverage through a state program or a copay assistance charity. Copyright 2006 Lash Group All rights reserved. 9

10 State Pharmaceutical Assistance Programs (SPAPs) Benefits vary among SPAPs Covers Part D deductible up to certain amount May cover Part D co-pay/coinsurance Beneficiary may be required to pay minimal co-pay and program may pay remainder May have annual fee May cover costs for generic products only Qualified program payments count toward TrOOP Eligibility requirements vary amont SPAPs Age requirement is typically 65+ Enrolled in a Medicare Part D plan and not qualified for LIS State residency typically required Financial criteria Copyright 2006 Lash Group All rights reserved. 10

12 Resources for Identifying SPAP Availability State Health Insurance Programs (SHIP) SHIP toll-free number or Website Volunteers may be able to provide assistance with determining SPAP eligibility and application assistance Searchable database by state that includes program contact information and basic eligibility requirements Patient advocacy organizations (AARP, Manufacturer patient assistance programs Some programs provide alternate insurance research support and may be able to provide instructions on SPAP application process and eligibility requirements Copyright 2006 Lash Group All rights reserved. 12

13 Co-pay Assistance Charities Charitable foundations assist patients with out-of-pocket costs Patients who have insurance but can t afford deductibles, copays, coinsurance, coverage gap and, in some cases, premiums Disease state specific funds Assistance is typically limited to a dollar amount per year. Patients are typically asked to reapply on an annual basis. For Part D enrollees, donations by charities count towards patient TrOOP How to access assistance Charities can be reached by phone (and many by web) where the patient or their healthcare provider can complete a pre-screen If the patient appears to qualify, an application is provided. Patient portion typically asks for patient demographics, insurance information and general income information. Healthcare provider portion typically asks for attestation of treatment. Copyright 2006 Lash Group All rights reserved. 13

14 Co-pay Assistance Charities (cont.) How to access assistance (cont.) Once approved patient may receive a benefit card which would allow the patient to use the card at the pharmacy and have claims adjudicated electronically without the need to provide cash and submit receipts for retrospective reimbursement. For physician administered drugs, the patient or their healthcare provider can submit a proof of expenditure form (similar to a secondary claim) for reimbursement by the charity. Copyright 2006 Lash Group All rights reserved. 14

15 Figure 3 - Copay Assistance Charities Charities Chronic Disease Fund HeathWell Foundation (800) National Organization for Rare Disorders (866) Patient Access Network (866) Patient Advocate Foundation (866) Patient Services Inc. (800) Copyright 2006 Lash Group All rights reserved. 15 Sample Disease Funds Acute Porphyria Anemia Ankylosing Spondylitis Asthma Breast Cancer Chemotherapy Induced Nausea & Vomiting Chemotherapy Induced Neutropenia Chronic Myelocytic Leukemia Colorectal Cancer Cutaneous T-Cell Lymphoma Gastrointestinal Stromal TumorsHead & Neck Cancer Growth Hormone Deficiency Hodgkin s Disease Kidney Cancer Lung Cancer Lymphoma Multiple Myeloma Myelodysplastic Syndrome Non-Hodgkin s Lymphoma Oncology Cytoprotection Pancreatic Cancer Prostate Cancer Psoriasis Psoriatic Arthritis Rheumatoid Arthritis Secondary Hyperparathyroidism Wilm s Tumor

16 Key Changes for 2007 Open enrollment for 2007 occurs November 15, 2006 through December 31, enrollment period allows one chance to either select or change plan Dual eligibles and some limited income beneficiaries are auto-enrolled Beneficiaries turning 65 in 2007 have 7 month enrollment window Plan options increased All enrollees have option to change plans during enrollment window Some plans are not continuing into CY 2007 and beneficiaries will need enroll in another plan Beneficiaries satisfied with current plan will not need to take action Some patients who were automatically eligible and enrolled in the Low Income Subsidy in 2006 will no longer be automatically eligible and will need to reaapply. Copyright 2006 Lash Group All rights reserved. 16

19 Variability Among Plans Remains in 2007 Part D premiums in CY 2007 range from less than $2 per month to over $135 per month. There are, however, many premiums below the national average of $24.95 per month. 60% (1,157) of Part D plans offer $0 deductible options. That is over 300 more plans providing first dollar coverage than last year. The maximum national standard deductible is $ And the number of plans providing some form of coverage through the gap nearly doubled from 220 to 550 (29% of all plans) 25 plans (1%) report coverage through the gap for all formulary drugs 465 Plans (24%) limit coverage in the gap to generics only. Catastrophic Coverage: Catastrophic coverage is 5% for covered drugs after the beneficiary has incurred a true outof-pocket of $3850. Copyright 2006 Lash Group All rights reserved. 19

20 Two Key Challenges that Remain for Patients: Plan Assessment and Selection Enhancements to Plan Finder ( will assist both patients and their advocates Changes in the layout and design of the tool based on usability testing. A decrease in the number of steps leading to plan comparisons and results. Total Monthly Cost Estimator functionality will provide a graph of the month-by-month cost share for a selected plan. In this way, users will be able to view how their cost share may change on a monthly basis as reflected by the coverage levels of the drug benefit. The information will reflect the beneficiary s low income subsidy status as well as their drug list and pharmacy selection. The revised plan finder tool is accessed at and were released mid-october with 2007 updates. Copyright 2006 Lash Group All rights reserved. 20

23 Figure 8 Resources to Help Navigate Part D Source of Information Manufacturer Sponsored Programs Centers For Medicare and Medicaid Services (CMS) Social Security Administration (SSA) Services Provided Patient Assistance and Reimbursement Support Services Referrals to co-pay assistance programs Drug Plan finder Tool (revised October 12, 2006) Formulary Finder Tool Medicare Plan Comparison Tool Information on applying for additional assistance Contact Information Patent Support Solutions (PSS) Medicare Local SSA office or State Health Insurance Programs (SHIP) or State Pharmacy Assistance Programs (SPAP) Additional Online Resources: May be able to provide wrap around coverage or information on financial assistance Contact your local SHIP or SPAP Copyright 2006 Lash Group All rights reserved. 23

24 Resources to Help Medicare has counselors that not only assist with questions about the Part D benefit but can also walk callers who do not have internet access through the Medicare Drug Plan Finder Tool in order to help the beneficiary narrow down their options for plan selection. Patients who need extra help can either go to their social security administration s local office or complete the application process online at Again, if you have a State Pharmacy Assistance Program in your area, that program may be providing extra help to Part D enrollees. You or your patient will need to contact your local SPAP to confirm what kind of coverage is available. Local State Health Insurance Programs or SHIPs are also available to provide education on navigating the choices of Part D, however they do not provide any insurance or wrap around coverage. A list of local SHIPs can be found online on the Medicare website. The Access to Benefits Coalition is working through local community coalitions to provide information to beneficiaries, their families, and their healthcare providers. Their focus includes helping beneficiaries with limited incomes know about and make the best use of all available resources for accessing prescription drugs and reducing their costs. You can find contact information for your local coalition on this website provides up-to-date information and the most recent news associated with Medicare Part D. includes frequently asked questions, a Medicare Part D checklist to help beneficiaries make an enrollment decision, and other useful resources for beneficiaries. helps beneficiaries and providers locate Medicare Part D educational support in their communities. Copyright 2006 Lash Group All rights reserved. 24

Medicare Minute Teaching Materials - June 2018 How to Afford Your Part D Drug Costs

Medicare Minute Teaching Materials - June 2018 How to Afford Your Part D Drug Costs 1. What costs may a Medicare beneficiary with Part D prescription drug coverage be responsible for? Medicare Part D,