Eligibility and Enrollment in the Medicare Prescription Drug Program Danielle Moon, Centers for Medicare and Medicaid Services Linda A. Malek, Esq., Partner Moses & Singer LLP Medicare Prescription Drug Part D Compliance Conference
Purpose of the Presentation Brief overview of eligibility and enrollment Explanation of the low-income subsidy Discuss auto-enrollment, facilitated enrollment for certain beneficiaries Highlight key dates
Eligibility for Medicare Prescription Drug Coverage An individual is eligible for Medicare prescription drug coverage, provided that he or she Is entitled to Part A OR enrolled in Part B Lives in the service area of a prescription drug plan
Enrollment Options Someone who is eligible for Medicare Rx coverage can enroll in a Prescription Drug Plan (PDP) or Medicare Advantage Prescription Drug plan (MA-PD plan) Generally, someone must have Medicare Part A and Part B to join a Medicare Advantage Plan. There are some exceptions Private Fee For Service plans without Rx, MSAs Beneficiaries can also keep their current creditable coverage through an employer/union or other federal or state program
A Note About Creditable Coverage Plan sponsors were required to provide Medicare eligible individuals with a notice of creditable coverage by November 15 th. Coverage is considered creditable if it is actuarially equivalent to the prescription drug benefits under Part D. If a potential enrollee does not have creditable coverage and fails to enroll in Part D when initially eligible, s/he will likely have to pay a higher Part D premium.
Initial Enrollment Period (IEP) Start of the Drug Benefit Program Nov 15, 2005 to May 15, 2006 for individuals who Are currently Part D eligible, or Will become Part D eligible in November, December, 2005, and January 2006 Effective dates for enrollment Jan 1, 2006 for an enrollment received before Dec 31, 2005 The first day of the calendar month following enrollment for an enrollment received between Jan 1 and May 15, 2006
Initial Enrollment Period Individual s Initial Eligibility In general, the initial enrollment period is similar to the initial enrollment period for Part B. This is a 7-month enrollment period 3 months before eligibility for Part D, the month of eligibility, and 3 months after eligibility for Part D Effective dates for enrollment An enrollment made prior to the month of eligibility for Part D is effective the first day of the month of eligibility An enrollment made during or after the month of eligibility for Part D is effective the first day of the calendar month following the enrollment
Initial Enrollment Period Example Mrs. Jones is turning 65 on June 26, 2006. She is eligible for Medicare on June 1, 2006. Mrs. Jones is eligible to enroll in a Part D plan beginning on March 1, 2006. She can enroll as late as September 30, 2006. Her coverage cannot be effective any earlier than June 1.
Annual Coordinated Election Period (ACEP) For the 1 st year, the AEP is the same as the Initial Enrollment Period Enrollment is effective Jan 1, 2006, if received before Dec 31, 2005 First day of the calendar month following enrollment, if received between Jan 1 and May 15, 2006 In 2006 and after, the AEP is from Nov 15 to Dec 31 of each year Enrollment is effective Jan 1 of the following calendar year
2006 PDP Enrollment Periods* NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Initial Enrollment Period (IEP) Annual Coordinated Election Period (AEP) Part D Begins AEP *Does not reflect Special Enrollment Periods
Special Enrollment Periods Most people with Medicare will remain enrolled in a prescription drug plan for a year. Full-benefit dual eligibles have an SEP by law, meaning they can change at any time (once/month). Other people who get the low-income subsidy who have their enrollment facilitated will have one SEP (outside of the normal opportunities in which any beneficiary can change plans).
Enrollment Opportunities Each Medicare beneficiary has at least 2 Part D enrollment opportunities from November 15, 2005 through May 15, 2006: IEP for Part D AEP Medicare beneficiaries eligible for MA will have these two opportunities PLUS a third, through June 30, 2006: IEP for Part D AEP MA OEP (and coordinating PDP SEP) may apply Additionally: Beneficiaries can cancel enrollment prior to the effective date without using an election SEPs could apply
Marketing Overview The CMS Marketing Guidelines (the Guidelines ) authorized Prescription Drug Plans ( PDPs ), Medicare Advantage Prescription Drug Plans ( MA PDPs ) and Health Plans to begin marketing to Medicare beneficiaries on October 1, 2005. The guidelines are applicable to both pre-enrollment and post-enrollment marketing activities. Failure to comply with the Guidelines can result in the imposition of corrective action plans, civil monetary penalties (or CMPs), sanctions and other legal action by federal and/or state law enforcement agencies such as the OIG.
Marketing: Pre-Enrollment The Guidelines set forth plan-specific requirements for pre-enrollment marketing initiatives which cover most aspects of marketing efforts including: Language requirements Network limitations (PDP only) Hours of operation Enrollment limitations Identification of all plans TTY/TDD numbers Availability of alternative formats Claim forms and paper work
Pre-Enrollment Marketing: Permissible Advertising Mediums Direct mail (without enrollment forms) Telephone (Do Not Call laws, including the Do Not Call Registry must be respected) Television and radio Outdoor ads and banners Internet and print ads
Marketing: Required Documents At The Time Of Enrollment And Annually Thereafter Information about low-income subsidies Drugs included on the health plan s formulary (if abridged list is provided it must also include instructions on how the enrollee can obtain the complete formulary) Summary of benefits Evidence of Coverage ID card (enrollment only) Provider Directory (enrollment only) Annual Notice of Change (only annually) ( ANOC )
Pre-Enrollment Marketing: Incentives/Promotions Health plans may offer value added items or services ( VAIS ) to potential Medicare enrollees as long as they are: Less than $15.00 Of otherwise nominal value Not cash Disclaimers must accompany any offers of free gifts, prizes or drawings Special rules exist for health fairs and similar events
Marketing: Involvement Of Providers The Guidelines strictly regulate the activities of providers with respect to marketing. PROVIDERS MAY: Distribute plan marketing materials. Educate potential enrollees about PDPs and objectively assist them with their decision making. Display materials that advertise the relationship of the provider with the plan. PROVIDERS MAY NOT: Induce or discourage enrollment in a plan based on the provider s financial interest. Accept enrollment applications. Receive money from a plan or other compensation (direct or indirect) for enrolling individuals or otherwise engaging in any other enrollment activities.
Enrollment Process Part D plans must accept paper applications CMS has provided model enrollment forms May also accept enrollments via secure website May also participate in CMS Online Enrollment Center May also accept enrollments via telephone Cannot attempt to enroll on out-bound calls Calls must be recorded, records retained Cannot ask for financial information during call Group enrollment and disenrollment process allowed for employer/union groups Streamlined process, can be electronic, at plan and employer/union option Allows for enrollment or disenrollment without separate paper form
Special Two-Step Enrollment Process Applies to those who enroll and whose employer is claiming them for retiree subsidy Enrollment edit will check for retiree subsidy designation and notify plan Plan must send notice advising beneficiary of employer coverage and possible consequences Model notice provided in guidance Enrollment not processed until beneficiary responds After 30 days, enrollment request denied, beneficiary notified accordingly
Consequences of Late Enrollment Beneficiary charged an additional 1% of the base premium for every full month a beneficiary Was eligible to enroll in Part D plan but not enrolled Did not have creditable drug coverage (coverage on average as good as Medicare) for a period of time 63 consecutive days or longer
Late Enrollment -- Example Mrs. Jones does not enroll in a Part D plan during her initial enrollment period, which ends September 30, 2006. Her next chance to enroll will be November 15, 2006, during the AEP. Coverage is effective Jan 1, 2007. Because Mrs. Jones is without creditable drug coverage for 3 full months (October, November, and December), she pays a penalty of 3% of the base beneficiary premium.
Low-Income Subsidy Basics Provides people with limited income and resources extra help with their Medicare prescription drug plan costs, including their premiums and cost sharing. A person must enroll in a Medicare prescription drug plan to receive this assistance. Beneficiaries can apply via SSA website, field office, or toll-free phone number, or State Medicaid office
Low-Income Subsidy Eligibility People with limited income and resources (less than $11,500/single and $23,000/couple). Certain groups are automatically eligible for a full subsidy and don t have to apply. These groups are: Full-Benefit Dual Eligible Individuals (People with Medicare and full Medicaid benefits) SSI recipients (but no Medicaid) Medicare Savings Program Groups (QMBs, SLMBs, and QIs)
Amount of Assistance Available Full Subsidy (Deemed groups) Full premium assistance up to the premium subsidy amount. Nominal cost sharing up to out-of-pocket threshold. No coverage gap. Other Low-Income Subsidy Sliding scale premium assistance. Reduced deductible. Reduced coinsurance. No coverage gap.
Notice to Those Deemed Eligible CMS notified beneficiaries who are deemed eligible for the low-income subsidy and do not need to apply. This notice explained the following: On January 1, 2006, all people with Medicare can get Medicare prescription drug coverage. Some people will receive letter from SSA telling them to apply to get help. You don t need to apply for this help. The Medicare and You 2006 handbook includes information about how to pay for your drug costs and what you need to do. Medicaid will stop paying for your prescription drug coverage after December 31, 2005. (Specific to dual eligible notice)
Auto-Enrollment Procedures Full-benefit dual eligible beneficiaries will be enrolled based on where they currently get their Medicare Part A and/or Part B benefits, and the amount of the prescription drug plan s premium. Beneficiaries in Medicare Advantage plans will be enrolled in an MA-PD plan by the MA organization. Beneficiaries in Original Medicare were assigned randomly to a PDP in their area with a premium at or below the low-income benchmark premium amount. Beneficiaries were auto-enrolled regardless of employer/union coverage
Auto-Enrollment Notification CMS notified full-benefit dual eligibles of their autoenrollment. This notice provided: An explanation of how to choose a Medicare prescription drug plan. The name of the Medicare prescription drug plan that Medicare will enroll them in if they don t choose a plan by 12/31/2005. We will also include that plan s toll free member services number and website. A reminder that their Medicaid drug coverage ends 12/31/2005; they qualify for extra help with their drug plan costs; and they can change plans at anytime. An explanation of their right to affirmatively decline Part D. The 1-800-MEDICARE number for questions.
Facilitated Enrollment Procedures and Notification CMS will facilitate the enrollment of additional categories of beneficiaries if they do not choose a plan on their own by the end of the initial enrollment period. These categories include MSPs, SSI recipients, and people who apply and are determined eligible for the low-income subsidy. Starting in April 2006, we will notify these individuals if they do not choose a plan by May 15, 2006, we will facilitate their enrollment in a plan on their behalf, with coverage effective June 1, 2006. Beneficiaries will not be enrolled if claimed by employer for retiree subsidy
Key Dates for Enrollment November 15 th Enrollment began. December 31 st: Last day to enroll for a January 1 st effective date. Full-benefit dual eligibles must opt-out of their assigned plan by this date or they will be autoenrolled. Medicaid drug coverage ends for full-benefit dual eligibles. January 1 st Medicare prescription drug coverage begins.
Key Dates for Enrollment February CMS mails a reminder notice to people who have not yet enrolled in a plan. April CMS mails a notice to people who qualify for the low-income subsidy, identifying the plan in which Medicare will facilitate their enrollment, effective June 1, 2006, if they do not choose a plan on their own by May 15, 2006. May 15 th Initial Enrollment Period ends for people who are currently eligible.
Questions? Danielle Moon, Acting Deputy Director, Medicare Enrollment and Appeals Group danielle.moon@cms.hhs.gov (410) 786-5724 Linda A. Malek, Esq., Partner Moses & Singer LLP lmalek@mosessinger.com (212) 554-7814