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Medicare Drug Benefit Update

Transition Protections Extended Through March 31

February 3, 2006

The Centers for Medicare and Medicaid Services (CMS) announced yesterday that it is extending, for an additional 60 days, a requirement for drug plans to automatically cover medications prescribed to dual eligibles as of January 1.  The requirement mandates that all Medicare drug plans and pharmacies provide refills of any medication prescribed to a low-income beneficiary eligible for both Medicare and Medicaid, so long as the medication was prescribed prior to January 1. 

This transition plan requirement is compulsory regardless of whether or not a medication is on the drug plan’s formulary or subject to an access restriction such as prior authorization or step therapy (a new medication prescribed after January 1 is not part of this requirement).  The additional 60 days will provide more time for dual eligibles to apply for exceptions from plan restrictions or switch to a different plan that covers their medications on a more comprehensive basis.  It will also help ensure that vulnerable beneficiaries face no break in their continuity of care and are not forced to pay more than $3 for a brand name medication or $1 for a generic.

Hints and Tips for NAMI Members in Navigating the New Medicare Drug Benefit

Click here to view a fact sheet containing a summary of requirements for drug plans and pharmacies in serving enrollees who are dual eligibles with severe mental illness.  Also included in the fact sheet are a series of FAQs.

NAMI Joins in Testimony to Senate Committee

At a Senate Aging Committee hearing yesterday, Michael Donato (a consumer with schizophrenia and bipolar disorder from Mansfield, OH) and Sharon Farr (his case manager from the Center for Individual and Family Services) offered testimony on the new Medicare drug benefit.  This testimony was delivered on behalf of NAMI and the National Council for Community Behavioral Healthcare. 

The testimony offered the perspectives of both an individual dual eligible beneficiary living with severe mental illness and front line agencies coping with the complexities of the new program.  Like too many beneficiaries with mental illness, Frank Donato faced initial gaps in coverage in early January, which are now being resolved as drug plans and pharmacies are able to confirm enrollment and dual eligible status to ensure that all medications are covered with cost sharing that does not exceed $1 for a generic drug and $3 for a brand name drug.

View the testimony of Frank Donato and Sharon Farr.

CMS Clarifies Policy for Reimbursement for States Covering Gaps in Coverage

On February 2, CMS issued further details on how states that have agreed to cover medications for dual eligibles in the initial transition period will be reimbursed.  In recent weeks, 23 states have provided reimbursement for a range of gaps in coverage for dual eligibles.  This has included state coverage for medications excluded from Medicare drug plan formularies and payment for cost sharing above the limited $1/$3 co-payments that dual eligibles should be charged under the benefit.  This has resulted in states paying for prescription costs that should be paid for by private sector Part D drug plans.  CMS has undertaken the following steps to help states recover these costs:

  • Working directly with Part D plans to reimburse states for the amount the plans would otherwise have paid;

  • Developing a demonstration project under which the federal government will reimburse states for the remainder of their costs, including the administrative costs for paying the state claims; and

  • Establishing a policy that ensure states will only serve as a payer of last resort – CMS will assist states to support pharmacist efforts to primarily bill the Medicare Part D plans, and thereby promote the use of the Medicare point-of-sale billing before relying on State payment.

Please Let NAMI Know About Your Experiences With Medicare Part D

If you (or a family member) have personal experience with the new Medicare drug benefit (positive or negative) -- particularly with specific pharmacies and Medicare drug plans -- please let us know.  NAMI will protect the confidentiality of all submissions, although the name(s) of the denied medication, Medicare drug plan, and pharmacy involved will be important (i.e., the name of the dual eligible beneficiary is not needed).  You can contact the NAMI National staff with your personal experiences under Medicare Part D at: OR 1-888/999-6264, ext. 1228.

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