Prescription Drug Improvement and Modernization Act

1. Prescription Drug Improvement and Modernization Act Dorothy Della Sherwood, M.D. Presbyterian Hospital of Dallas 2/22/2006

2. MMA • This year, Medicare introduced the prescription drug benefit-the most significant change in Medicare coverage since the program’s inception…which will help patients and doctors work together to alleviate symptoms and reduce the rate of complications from serious illness. • Mark B. McClellan, M.D., PhD., NEJM 12/05

3. MMA • America’s older citizens have been barraged with educational and marketing initiatives for various drug plans….an October poll indicated that 61% did not understand the program and 54% did not intend to sign up. • Richard L. Kravitz, M.D. NEJM 12/05 UC Davis

4. MMA CMS Goal for the Drug Benefit 1. Ensure all beneficiaries have access to high-quality, affordable drug coverage 2. Provide continuous access to drugs needed by the chronically ill 3. Create a competitive, transparent marketplace

5. MMA • Competitive/Transparent • Medicare Prescription Drug Plans ( MPDP) negotiate with drug companies to purchase drugs at a discounted price which they pass on to the beneficiary. • CMS is counting on this competition to hold down prescription prices

6. MMA • When choosing a PDP, one should compare • Deductible • Monthly Premium • Co-pay for Rx • Formulary • Gap Coverage • Mail-in or local pharmacy

7. MMA • The minimum prescription-drug benefit required by Medicare • No more than $250.00 deductible • A monthly premium ( average of $37.00/mo) • Pay 25% of the next $2000.00 in costs ($500.00) • Pay 100% of the next $2,850.00 – the gap • Total out of pocket costs could reach $3,600.00/yr • Catastrophic coverage begins and beneficiary pays only 5%

8. MMA • Competition has resulted in better coverage than those that have been mandated. • WWW.CMS.GOV

9. MMA • Help for People with Limited Incomes • People with lowest income and resources • Pay no premiums or deductibles • Have small or no co-payments • Eligibility • <$1,197 per month for an individual with <$11,500 in assets (excluding house) • <$1,604 per month for a couple with <$23,000 in assets (excluding house)

10. MMA • How to apply for extra help. • SSA mailed applications to those who may be eligible • www.ssa.gov • All dual eligible ( Medicare and Medicaid) are automatically enrolled

11. MMA • What about Medigap? • Information was sent to people with Medigap giving them the following choices: • Keep Medigap • Join Medicare Prescription Drug Plan and delete drug coverage from Medigap • Drop Medigap and join Medicare Advantage

12. MMA • What about Employer/Union Coverage? • Choices include • Keep coverage offered by employer/union • Join MPDP • Join Medicare Advantage Plan • Advise to contact Employers/Union • There is a tax free subsidy provided by Medicare to the Employers who offer coverage • Employers may contract with a MPDP to provide coverage

13. MMA • Specific Drug Coverage mandated by MMA • Cancer medications • HIV/AIDS treatments • Antidepresssants • Antipsychotics • Anticonvulsants • Immunosuppressants

14. MMA • Excluded Drugs • Weight Loss Drugs • Fertility Drugs • Cosmetic hair growth products • Cough suppressants • Benzodiazepines • Barbituates • Vitamins • Non-prescription drugs

15. MMA • Formularies • Most MPDP have formularies • All formularies must include at least 2 drugs from every category of drug • The formulary must be approved by CMS • Tier 1 drugs have the lowest cost sharing • There must be an exception procedure for tiered formularies – to obtain a drug at a more favorable cost or obtain a drug not on formulary

16. MMA PDP Formulary Available at www.epocrates.com http://formularyfinder.medicare.gov/formularyfinder/selectstate.asp

17. MMA • Perils • Exception Request: • Patient is unable to take a statin due to myopathy and therefore requires Zetia • PDP considers Zetia a ‘Step Drug’ after maximizing statin • The enrollee can request an exception to the plan’s step-therapy requirement

18. MMA • Process: • PDP pharmacy initiates with fax entitled “Request for Prescription Information or Change” • Physician initiates request to the PDP with a “Request for Prescription Exception” • Exceptions should be reviewed in 24 hours if the need is immediate

19. MMA • Plan Contacts for appeal: • www.cms.hhs.gov/PrescriptionDrugCovGenIn • There are 5 levels of appeal and it may indeed end up in the Federal Courts! • Redetermination by plan • Reconsideration by a Medicare drug coverage QIC • Administrative Law judge • Medicare Appeals Council • Federal District Court

20. MMA • Why should the Medicare beneficiary enroll now? • Late enrollment results in a 1% increase in premium per month for every month the person was eligible but did not join. • This penaltywill be paid forever! • This penalty does not apply to individuals with prescription drug coverage that equals the Medicare coverage

21. MMA • Individual Choice • Last date for enrollment is May 15th, 2006 • All Medicaid beneficiaries were automatically enrolled by Jan 1st if they had not chosen a plan.

22. MMA • So what will this cost? BILLIONS over the next 8 years. • Payments to MPDP : 448 to 479 • Low Income Subsides: 192 to 239 • 35% of the Medicare Population • Spending on health care is expected to increase from 1.8 trillion dollars in 2003 to 3.6 trillion dollars in 2014

23. MMA • Web sites for your patients • www.medicare.gov • www.cms.hhs.gov • www.ssa.gov • Phone • 1-800-MEDICARE (800-633-4227) • SS – 1-800-772-1213