The Medicare Drug Benefit: The Role of Specialty Societies

1. The Medicare Drug Benefit: The Role of Specialty Societies Susan Nedza M.D., M.B.A., FACEP Chief Medical Officer Chicago Regional Office Centers for Medicare & Medicaid Services 312-886-5341 Susan.nedza@cms.hhs.gov

2. Perspectives on Medicare • 2003 • Medicare paid 272.6 billion dollars • 2004 • Nearly 42 million persons in Medicare • 2030 • Projected 70.5 million persons over 65 Almost doubled in only 30 years

3. Medicine has changed and so must Medicare • Move to cover preventive services • Paying for medications that are critical to the health of our patients

4. What Does this Mean for Physicians? Medicare must reach physicians and the patients that they care for about these important changes.

5. WHY IS YOUR HELP CRITICAL? Where do these populations go for information? (12/04) 38% (04/05) 49% Your doctor A Medicare office, website or phone number Your pharmacist A health insurance company Friends or family members A Social Security office, website or phone number A local seniors’ group or community organization An employer or union Source: Kaiser Family Foundation Health Poll Report survey (conducted December 2-5, 2004)

6. The Medicare Drug Benefit • The benefit is available to all people with Medicare • There is additional help for those with limited resources and income • The benefit pays for brand name as well as prescription drugs • Refer patients and their medical decision makers to www.medicare.gov or 1- 800- MEDICARE.

7. Eligibility and Enrollment Prescription Drug Benefit • Must have Part A and/or Part B • Enrollment in drug coverage is voluntary • If do not enroll, subject to late enrollment penalties • Enrollment begins 11/15/05, continues through 5/15/06 • Will NOT be enrolled automatically – must make a decision to sign up for drug plan

8. Standard Prescription Drug Benefit • $37 monthly premium (average) • $250 beneficiary deductible • Medicare will pay 75% of drug costs up to $2,250 The beneficiary will pay 25% of these costs • Beneficiary will pay 100% of drug costs between $2,250 and $5,100 • After $3,600 in out-of-pocket spending, Medicare will pay approximately 95%

9. Summary of Choices • A prescription drug-only plan (PDP) in addition to traditional fee-for-service Medicare or private fee-for-service Medicare • A Medicare Advantage plan – either a regional PPO, local PPO, HMO, or special needs MA plan • A qualified employer or union plan • New enrollees will not be able to sign up for a Medigap drug plan, but existing beneficiaries will be able to renew Medigap H, I, or J plans where they are available • A “fallback” drug-only plan, if an insufficient number of PDPs or PPOs emerge in a particular area

10. Timeline • 5/05: SSA sends out enrollment packages for low-income • 9/14/05: CMS awards bids to PDPs, MA-PDs • 10/05: CMS mails Medicare Handbook; PDP Compare • 11/15/05: Enrollment in Prescription Drug Plan begins • 12/31/05: Medicaid Drug Coverage ends for dual-eligible • 1/1/06: Medicare Drug Prescription Plan, retiree options begin • 5/15/06: Last day to enroll before penalties

11. What Is the Message to Your Members? • Encourage patients to fill out low income subsidy application. • Refer patients to 1-800 MEDICARE for information or to the SHIP. • CMS will work through your society to provide training, materials and information about the drug benefit to your members and their staffs.

12. The State Health Insurance Assistance Program SHIP Program • A national program that offers one-on-one counseling and assistance to people with Medicare and their families. • SHIPs provide free counseling and assistance via telephone and face-to-face interactive sessions, public education presentations and programs, and media activities

13. The State Health Insurance Assistance Program SHIP Program Beneficiary Contact: Senior Health Insurance Information Program (SHIIP)Illinois Department of Insurancehttp://www.ins.state.il.us/Ship/ship_help.htm800-548-9034 (In-State calls only) 217-785-9021 (Out-of-State calls)

14. Conclusions • Physicians need to be engaged in efforts to meet the challenges of transforming the healthcare system. • Physicians must continue to be patient advocates in these efforts.

15. For More Information • Visit www.medicare.gov • Visit www.cms.hhs.gov • Visit www.socialsecurity.gov • Publications such as: • Medicare & You handbook • Facts About Medicare Prescription Drug Plans • 1-800-MEDICARE • Call Social Security at 1-800-772-1213 • SHIP 1- 800-548-9034

16. Questions? Susan Nedza MD, MBA FACEP 1-312-886-5341 Susan.nedza@cms.hhs.gov