Maximizing the Medicare Drug Discount Card Subsidy
and Part-D State Implementation Status Update Web-conference
December 16, 2004 3:30 – 5:00 pm EST
3:30 – 3:35
Dr. Mark McClellan Welcome
3:35 – 3:50
Tim Trysla
Moderator, Agenda, Discount
Card
3:50 – 4:05
Kim Fox
State experience with Drug
Card Enrollment
4:05-4:20
Michael McMullan
CMS Timeline
4:20 – 4:35
Gale Arden
Low Income Subsidy
4:35 –4:50
Donna Boswell
SPATC Preliminary
Recommendations
4:50 – 5:00
Any Additional Questions/ Wrap Up
Dr. Mark McClellan

Welcome
Tim Trysla

Agenda

Discount Card
Kim Fox

State experience with Drug Card
Enrollment
Maximizing Enrollment in Transitional Assistance:
Lessons from Medicare Discount Cards and Other
Low-Income Enrollment Initiatives
Presentation
to the
National Governors Association
Kimberley
Rutgers
Fox, Senior Policy Analyst
Center for State Health Policy
December

16, 2004
Acknowledgement


Presentation based on:
Study of state pharmacy assistance programs funded
by The Commonwealth Fund



Telephone interviews in Spring 2004 with 17 states re:
Medicare coordination of benefit issues and discount card
experience.
Website with more detailed reports:
http://www.cshp.rutgers.edu/
Findings from the State Solutions project funded by
the Robert Wood Johnson Foundation to maximize
enrollment in Medicare Savings Programs
(QMB/SLMB/QI1s).
Estimated Percent of SPAP Enrollees
Eligible for $600 Credit
100%

80%
60%
40%
20%
IL
*
M
TO E
TA
L
W
Y
J
N
Y
N
I
M
A
R
V
N
T
C
PA
M
O
M
I
N
C
IN
M
N
KS
0%
Source: Fox, K, Crystal, S. Coordinating Medicare Prescription Drug Benefits with State Pharmacy Assistance Programs. New York,
NY; The Commonwealth Fund, publication forthcoming.
*Includes disabled persons enrolled in state-only program. Enrollees in Illinois’ Senior Care Pharmacy Plus waiver program are
ineligible for transitional assistance and the discount card.
Number of States Mandating Enrollment in
Medicare during Discount Card Period

16
14
# of States
12
10
8
6
4
2
0
Mandatory
Voluntary
Source: Fox, K, Crystal, S. Coordinating Medicare Prescription Drug Benefits with State Pharmacy Assistance Programs. New York,
NY; The Commonwealth Fund, publication forthcoming.
States Strategies for Getting SPAP Eligible
Persons Enrolled
16

14
# of States
12
10
8
6
4
2
0
Autoenrollment in
Preferred Card
Facilitated
Enrollment in
Preferred Card
Autoenrollment in
Multiple Cards
Voluntary
Enrollment
N=10
Source: Fox, K, Crystal, S. Coordinating Medicare Prescription Drug Benefits with State Pharmacy Assistance Programs. New York,
NY; The Commonwealth Fund, publication forthcoming.
State Strategies for Enrolling Members in
Transitional Assistance

Autoenrollment in Preferred Card (8 states)






Authorized representative status
Expedited RFP or Expansion of Existing Contract
Opt-out letters – different methods for response.
High participation rates in short period.
Significant state savings reported
Autoenrollment in Multiple Cards (1 state)






Authorized representative status
RFI to card sponsors – data sharing agreement
Opt-out letters
Start-up delays, file-sharing inconsistencies
High participation rates after 6 months.
Savings still being determined.
State Strategies for Enrolling Members in
Transitional Assistance (cont.)

Facilitated Enrollment w/ Preferred Card (1)




Expedited RFP or Expansion of Existing Contract
Pre-populating applications
Outcome - ?
Voluntary Enrollment by Individual Members (6)

Outreach varies.






Letter to benes
Use of SHIPs
Outcome – Much lower enrollment rates in states that had data from CMS.
Minimal savings to state.
Two states moving to autoenroll or facilitate enrollment due to low
enrollment rates.
Many of those enrolled are not using the $600 credit.
Use of Incentives by SPAPs to
Encourage Enrollment

State pays all or portion of the 5-10% coinsurance (10 states)




Waiving other SPAP requirements




Enrollment fees
Counting $600 toward state deductible
Waiving reapplication for SPAP during discount card period.
Increasing SPAP Benefits



Preceded autoenrollment allowance.
Post autoenrollment maintained to discourage opt-out.
Outcome – difficult to measure.
Increasing benefit caps
SPAP pays first, discount card used only if state does not pay
Incremental impact of Incentives vs. other approaches unknown.

Most states using incentives were also autoenrolling.
Lessons from Efforts to Enroll Persons in
Medicare Savings Programs

Community-based outreach important



Linking outreach/enrollment with other low-income benefit programs




Simplifying application and renewal processes
Modifying eligibility and eliminating documentation requirements
Implications for Part D more than Discount Card/TA
Partnerships with Other Trusted Sources Helpful



Combined outreach for TA, SPAP, and MSP
Limiting administrative hassles can significantly impact enrollment


One-on-one assistance works best, but expensive
Use of SHIPs
Deputization to allow these entities to help fill out applications and submit
Kiosks at medical clinics.
Mixed success with direct mail
Summary of Enrollment Lessons
from Discount Card

Autoenrollment the most efficient mode for getting people enrolled.
 Transparent to enrollees.
 Nearly 100% of enrollment in transitional assistance is due to SPAP and M+C
autoenrollment.

One application process for card and subsidy minimized burden.




Will not be the case under Part D – expect even lower enrollment in
subsidies.
Asset test requirement will also reduce participation in Part D subsidies.
Left on their own, voluntary enrollment has been extremely low.
Voluntary enrollment may be enhanced by offering incentives, but degree
of impact unknown.
Michael McMullan

CMS Timeline
Gale Arden

Low Income Subsidy
Donna Boswell

SPATC preliminary recommendations
State Pharmaceutical Assistance
Transition Commission (SPATC)
Snap Preview of
SPATC Recommendations
For NGA Part D
Implementation Project
December 16, 2004
SPATC Charter in MMA

Appointed by the Secretary to develop a proposal to
advise the Secretary and the Administrator of CMS on
ways to address the unique transitional issues facing
SPAPs and SPAP participants consistent with the
following principles:
 Protection of the interests of program participants in a
manner that is least disruptive to such participants
and that includes a single point of contact for
enrollment and processing of benefits.
 Protection of the financial and flexibility interests of
States so that States are not financially worse off as a
result of the enactment of this title.
 Principles of Medicare modernization under the MMA.
Knowledge Through Experience

SPATC members believe that the
experience gained -

(1) in administering SPAPs for Medicare
beneficiaries over the last decade, and
(2) in helping those beneficiaries deal with the
Medicare drug discount cards
should be used to inform the part D
implementation and to avoid – if possible-making the same missteps twice!
SPATC Approach
For Tackling Complex Issues

The problems identified at the first meeting, July
8, 2004, were divided into three groups, and
Commission members each served on one of the
work groups:



1) transition of current SPAP beneficiaries: education,
eligibility, and enrollment;
2) benefit design/coordination of SPAPs with the new
Part D program; and
3) issues affecting the infrastructure of providers,
systems, and data collection and management.
Key Recommendations: 1

SPAPs should be considered
authorized representatives of their
beneficiaries for the purposes of
determining their eligibility for subsidy
assistance, enrolling them in one or more
preferred PDP sponsors, and paying their
Part D premiums.
Key Recommendations: 2

To provide seamless and comprehensive benefits
coordination, SPAPs should be allowed to
choose preferred part D sponsors on behalf
of their enrollees.


SPAPs know their beneficiaries’ existing medications
and can help select part D plan with appropriate
formulary and cost sharing to assure that
beneficiary’s transition is smooth.
The MMA “anti-discrimination” requirement can be
met by ensuring that the SPAP provides equivalent
subsidy to any of its beneficiaries that wishes to opt
for a different part D plan.
Key Recommendations: 3

The exceptions and appeals process, as
proposed in regulations, should be revised SPAPs should be given authority to appeal
on behalf of beneficiaries, since the SPAPs are
at financial risk for formulary denials and high tier
copays.
 The process should provide denial and
appeal rights notices and make the process
timelines much quicker for the sake of
consumer access and protection.
Key Recommendations: 4

CMS should form an advisory
committee of SPAP representatives
and other stakeholders (like the
SPATC) to assist and inform them
through the transition of implementing
Part D.
Key Recommendations: 5

A Centralized Data System should be
established to facilitate data exchange
through a single entry point so that all
involved parties have access to timely and
accurate data needed –
 for the “real-time” coordination of benefits
(COB);
 For the tracking of TrOOP.
Key Recommendations: 6

Marketing, enrollment, and
educational materials should be
appropriate to the beneficiary’s
situation,
including—


Information about the availability of SPAP
coverage in the State, and
clear explanations of how the SPAP will
coordinate prescription benefits with part
D plans in the state.
Key Recommendations: 7

CMS should ensure that SPAPs that do not wish
to provide full secondary coverage can
supplement the coverage offered by Part D
plan’s coverage by—




Paying premiums for standard coverage
Paying premiums for enhanced alternative coverage
Paying a flat fee to reduce cost sharing by eliminating
the deductible; filling the “donut hole”; or reducing
the coinsurance, like the federal subsidy does for the
lowest income beneficiaries, or
Paying cost-sharing for drugs for specific diseases.
Additional Questions

Please use the dialog box beside the
screen to send your questions to the
speakers.
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