DUAL ELIGIBLES AND MEDICARE PART D IN NEW YORK STATE

WHO IS A DUAL ELIGIBLE INDIVIDUAL?

A dual eligible is an individual who receives both Medicare and Medicaid benefits.

WHAT IS MEDICARE PART D?

Medicare Part D is a prescription drug benefit offered through private plans. It was offered for the first time as of January 1, 2006. Enrollees may choose to have the prescription drug benefit covered by:

· A prescription drug plan (PDP) - A private stand-alone plan or

· A Medicare Advantage Plan (MA-PD) – Previously called Medicare + Choice.

DUAL ELIGIBLES –PROFILE

Dual eligible individuals are often very vulnerable. Consider the characteristics of these individuals.[1]

? Statistically among the poorest and sickest health care consumers

? Most expensive to treat

? Generally require more services, use more drugs

? Generally have poorer healthcare outcomes

? Over 60 % live below the federal poverty level ($9,800 for individual or $13,200 for couple in 2006)

? 94% live below 200% of poverty level

? Disproportionately Hispanic or African-American

? Disproportionately women

? More likely to never have been married

? More likely to be in an institution

? Less likely to have graduated from high school

? More likely to be in a rural area

? More often live alone

? More likely to be under 65 and disabled or over 85

WHAT DUAL ELIGIBLES NEED TO KNOW

Coverage

Individuals eligible for both Medicaid and Medicare need to know that Medicaid will no longer cover most of their drugs. As of January 1, 2006, Medicare, not Medicaid, pays for most of the prescription drugs for dual eligible individuals. However, Medicaid will still pay for other health care costs.

Joining a Plan

Dual eligible individuals need to know that if they do not choose a plan, they will be automatically and randomly assigned to a plan. The plan may or may not meet their needs. However, they may choose a different plan at any time if the new plan does not meet their needs (i.e., they are not subject to the limitations on switching plans imposed on most Part D participants).

Dual eligible individuals in New York State need to know that if they do not participate in a Medicare prescription drug plan, they may lose all their Medicaid benefits. However, there is an exception for some people, who do not have to join a plan if they have coverage through their employer or union. If an individual receives a letter from his or her employer or union stating

that if he or she enrolls in a Medicare Part D plan they will lose the health care benefits provided by the union or employer, they may disenroll from the Medicare prescription drug program by calling 1-800-MEDICARE (1-800-633-4227). They must also give a copy of the letter to their Medicaid worker in order to continue Medicaid benefits. In some cases, they may have to re-enroll in Part D in order to continue to receive Medicaid. It is crucial that they keep copies of these letters and any related documentation since they may be necessary in the future if the individual wishes to participate in Part D and avoid a late sign-up penalty fee.

Choosing a Plan

When choosing a plan that will meet their needs, these individuals need to consider a number of factors: cost, coverage, utilization management and convenience.

Costs. Dual eligible individuals do not have to pay any premiums or payments to the plan in exchange for coverage if they choose a basic or “benchmark plan” which is a plan with a monthly premium at or below the low income premium subsidy amount. They do, however have to pay a co-pay for each medication (unless enrollees live in a nursing home). Typically, the co-pay for each medication they fill is $1 for

generic drugs and $3 for brand name drugs (for individuals in a basic plan). For non-institutionalized dual eligible individuals whose income is over 100% of the Federal Poverty Level (FPL), their co-pays will be $2/$5 (generic/brand).

However, dual eligibles who reside in Long Term Care Facilities (LTCFs) such as nursing homes, ICF/MRs (Intermediate Care Facilities/Mentally Retarded), and residential psychiatric treatment centers will receive their prescription drug coverage from the plan and will not pay a premium, a deductible or co-payments when they have resided in the LTCF for at least one full calendar month. See lth.state . ny.us/health_care/medicaid/program/update/2006/feb2006.htm#ben for a list of benchmark plans in NYS. It is important to note that LTCFs are government-defined and do not include assisted living, adult homes or other residential care settings not specifically defined in the regulations.

Coverage . Individuals must try to find a plan that covers the drugs they need. To find out which plan covers specific medications, go to: icare.gov/formularyfinder/selectstate.asp.

Utilization Management . Although hard to find out, the individual should try to find out what utilization management tools are used by the plan for the drugs they take and how they work. Do they require step therapy (requirement that certain medications be tried before that prescribed by the enrollee’s physician), dose restrictions (only specific doses are permitted), quantity limits (only a specific supply is permitted within a certain number of days) or prior authorization (approval must be gotten in advance) before covering?

Convenience . Individuals should find out if the pharmacy they have been using is in the plan’s network and if the plan offers mail order, if that is important to them.

MEDICARE PART D IS DIFFERENT FROM MEDICAID

The Formulary

Each plan has its own list of covered drugs which is referred to as a “formulary.” Formularies can vary between plans, even between plans from the same company. However, every formulary must include all, or substantially all: antidepressants, antipsychotics, anticonvulsants, anticancer drugs, immunosuppressants and HIV/AIDs medications. However, some plans may try to limit access to such medications by using

utilization management tools. Certain drugs/drug classes are excluded from Medicare Part D coverage, including: medications when used for anorexia, weight loss or weight gain; agents when used to promote fertility; medications when used for cosmetic purposes or hair growth; medications when used for the symptomatic relief of cough and colds; prescription vitamins and mineral products (except prenatal vitamins and fluoride preparations); non-prescription drugs; barbiturates; and benzodiazepines.

Companies are permitted to change their formulary at any time. This means that they can stop coverage of drugs or choose to cover different drugs at their discretion. It is important to know that, even though all formularies must include coverage of all the different types of drugs mentioned above, a company is not obligated to add an equivalent medication when a medication is dropped, other than the requirement that they maintain coverage in all the mandatory categories. However, if a Part D plan removes a drug from its formulary, it must either continue to cover it for individuals in their plan who had been using it or notify them at least 60 days prior to the change that the drug will no longer be covered. In any case, according to a Center for Medicare and

Medicaid Services’ (CMS) memo[2], plans are required to continue covering the affected drug for the rest of the year for drugs that the enrollee was already taking when they joined the plan. Thus, if an individual chooses a plan specifically because it covered a certain drug, and the plan decides to drop it, according to the memo, it can't drop it for that individual until January 1 of the next year. That way, the individual has the opportunity to switch plans without a gap in coverage. It is important to note that some advocacy lawyers believe that since the memo is inconsistent with the regulations, it is unenforceable. However, we urge the use of this memo to convince plans to comply.

The Pharmacy

Enrollees must use a “participating” pharmacy (one that is in their plan’s network) and enrollees must use their Medicare plan card at a participating pharmacy to get prescriptions rather than their Medicaid card.

It is important to know that Medicare Part D provides fewer protections than Medicaid.

Dual eligible individuals may find they have access to fewer medications, higher copays, with no assurance of access to medications if they are unable to pay the copay and, for many, no assurance of coverage while an appeal is being considered. However, nursing home residents who are dual eligible are protected by the nursing home reform law, which mandates that facilities provide all services required by the resident’s comprehensive assessment.

Transition . Plans are required to provide enrollees with at least a short-term supply of the medications enrollees are currently taking (usually a one-month supply) during the transition to Medicare Part D. However, the transition supply is for drugs that the plan doesn't cover, because either because they are not on the formulary or because utilization management tools limit access to them. Transition rules do not apply to drugs that are excluded from Part D. An individual is in “transition” when they enroll in a new prescription drug plan, change their Part D plan to another Part D plan, change from another drug plan to a Part D plan, or when they change their setting of care (for example, from a hospital to a home or institutional setting). The transition supply is to provide beneficiaries with an opportunity to seek coverage of the non-covered drug, or to fulfill utilization management requirements, so beneficiaries receiving such a transition supply should contact their plans immediately to determine how to proceed.

Incurred Medical Expense Deduction . Those individuals who have “excess income” they need to spend before becoming or remaining eligible for Medicaid may apply any co-pays or other costs of medication to their spend down. This may be useful for those individuals who cannot get their medication unless they pay for it.

Prescription Denials . It is important to note that if a prescription submitted by a dual eligible individual with Part D coverage is turned down at pharmacy, Medicaid may pay for it. Medicaid will continue to cover certain drugs that are excluded from Medicare Part D coverage, including barbiturates, benzodiazepines, and certain over the counter medications covered under Medicaid.

Wrap-Around Benefit – The Pharmacist Can Immediately Bill Medicaid . Medicaid will also pay for some medications that a specific plan will not cover. Currently, Medicaid will cover all Medicaid covered drugs. However, as of January 1, 2007, only the following drugs will be covered through a Medicaid “wrap-around" benefit: atypical antipsychotics, antidepressants, antiretrovirals used in the treatment of HIV/AIDS and anti-rejection drugs used in the treatment of tissue and organ transplants. In addition, these medications will be covered by Medicaid only if: these drugs are not covered by the specific plan, the individual does not meet the plan's utilization management requirements, or the Part D plan has quantity limits inconsistent with the amount of the medication prescribed for the individual.

If a dual eligible individual can't get their Part D plan to cover a non-excluded drug at the pharmacy counter for any reason (off-formulary, quantity limit, prior authorization, etc.), the pharmacist can simply bill Medicaid. The pharmacist doesn't need to obtain any kind of verification code, as was previously thought. Instead, the pharmacist just executes an "over-ride.”

However, the pharmacist is required to try to get the plan to cover before sending the bill to Medicaid. He or she must first confirm that the plan will not cover and/or the individual’s needs do not meet the plan’s utilization management requirements or the plan’s quantity limits are inconsistent with the prescribed amount. He or she may call

the physician to discuss these issues. While waiting to see if things can be worked out to have the plan cover (for instance, the individual’s physician might determine that his or her needs can be met by a covered drug), the pharmacist can bill Medicaid. The pharmacist can also immediately bill Medicaid upon confirmation of the plan’s non-coverage or satisfaction of the other issues mentioned above. If a drug requires prior authorization by Medicaid, the physician and pharmacist must complete the process for duals by calling 1-877-309-9493.

In August of 2006, the Department of Health released, “Pharmacist Procedures for Billing Medicare Part D Plans.” These procedures require the pharmacist to first check for enrollment in a Part D plan by asking for a plan ID card or other documentation from a Part D plan, or by submitting an “E1 query” to CMS to check the individual’s eligibility for Part D. Pharmacists can also get information on a beneficiary's enrollment, and on how to contact the plan by calling Medicare at 1-800-MEDICARE (1-800-633-4227).

If the individual is enrolled in a plan, but is not being charged the correct dual-eligible co-payment amounts, the pharmacist must contact the drug plan (which has expedited access for pharmacy requests to adjust co- payments), or, if the situation is urgent and other steps have not worked, contact Medicare at 1-800-MEDICARE for urgent caseworker assistance for the beneficiary.

If there is no evidence of a Part D plan enrollment but there is clear evidence of both Medicare and Medicaid eligibility (for example, a Medicare card and a Medicaid card or prior history of Medicaid prescription coverage at the pharmacy) the pharmacist is required to bill the Point of Service POS Contractor (WellPoint – who will cover pending Medicare coverage) for the claim. The pharmacist can also call 1-800-MEDICARE to confirm that the beneficiary is in Medicare.

After completing all necessary procedures to assure Medicare Part D coverage, and failing to gain coverage, the pharmacist may submit the claim to Medicaid. The pharmacist must include additional information, which verifies that the pharmacist has attempted, and failed to bill Medicare, in order to receive payment approval.

PLAN COVERAGE DETERMINATIONS, EXCEPTIONS AND APPEALS FOR DRUGS COVERED UNDER MEDICARE PART D

Coverage Determinations

Enrollees (and their representatives or physicians) can request a coverage determination (the decision made by a plan regarding the prescription drug benefits an enrollee may be entitled to) if they do not get this informally (by calling the plan). A standard request must be responded to within 72 clock (not business) hours upon receipt and an expedited request must be responded to within 24 clock hours. If the physician indicates, either orally or in writing, that applying the standard time frame “may seriously jeopardize the life or health of the enrollee or the enrollee’s ability to regain maximum function,” the plan must grant an expedited review. In expedited cases, plans must accept oral statements by the treating physician. Although the plan may ask for additional information from the physician, the clock starts upon receipt of the initial supporting statement.