bcnepa/fph 2006 seminar medicare before and after part d april 26, 2006 randy grabiak highmark...
TRANSCRIPT
![Page 1: BCNEPA/FPH 2006 Seminar Medicare Before and After Part D April 26, 2006 Randy Grabiak Highmark Senior Products Medicare Part D Product Director](https://reader036.vdocuments.net/reader036/viewer/2022081519/56649de75503460f94ae06d8/html5/thumbnails/1.jpg)
BCNEPA/FPH 2006 Seminar
Medicare Before and After Part D
April 26, 2006
Randy GrabiakHighmark Senior Products
Medicare Part D Product Director
![Page 2: BCNEPA/FPH 2006 Seminar Medicare Before and After Part D April 26, 2006 Randy Grabiak Highmark Senior Products Medicare Part D Product Director](https://reader036.vdocuments.net/reader036/viewer/2022081519/56649de75503460f94ae06d8/html5/thumbnails/2.jpg)
Agenda
• Trends in the Senior Market
• Part D Benefits & Guidelines
• Plan Participation
• Provider Challenges
• Questions
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Seniors’ Sources of InformationAMONG SENIORS: Percent who say they would be very likely to turn to each of the following for help in deciding whether to enroll in a Medicare drug plan…
Source: *Kaiser Family Foundation Health Poll Report Survey (conducted Mar. 31-April 3, 2005)
**Kaiser Family Foundation/Harvard School of Public Health (conducted October 13-31, 2005)
49%33%
27%
27%23%
21%
18%
8%
Trends in the Senior Market
Your doctor
Your pharmacist
A Social Security office, website or phone number
Friends or family members
A Medicare mailing, website or phone number
A health insurance company
A local seniors’ group or community organization
An employer or union
Survey March 31 – April 3, 2005
Medicare
Your doctor
Your pharmacist
Social Security
Friends or family members
A local seniors’ group or community organization
Medicaid
An employer or union
Survey October 13 – 31, 2005
9%14%
16%
20%24%
25%
32%
33%
![Page 4: BCNEPA/FPH 2006 Seminar Medicare Before and After Part D April 26, 2006 Randy Grabiak Highmark Senior Products Medicare Part D Product Director](https://reader036.vdocuments.net/reader036/viewer/2022081519/56649de75503460f94ae06d8/html5/thumbnails/4.jpg)
Health Insurance Trends Prior to Part D
Medicare Advantage
7%
Employer-Sponsored
28%
Medigap10%Medicaid
15%
Other6%
Self-Pay28%
Part A Only6%
Private45%
No Coverage34%
Government21%
To offset the growing out-of-pocket expense, many beneficiaries have turned to various forms of private or public supplemental coverage to help defray the cost of prescription drugs
However, more than a third still have no prescription drug coverage
Lack of drug coverage can have adverse affects
Sources of Prescription Drug Coverage
Trends in the Senior Market
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Health Care Delivery and Expenditure Trends
Trends in the Senior Market
Seniors are particularly vulnerable to the increased cost of prescription drugs because:
– Drug usage increases with age
– Prior to Part D Medicare did not cover most prescription drugs
Source: Ageworks, a division of the Ethel Percy Andrus Gerontology Center, USC
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Medicare Beneficiaries’ Out-of-Pocket Prescription Drug Spending, 2000-2013$2,763*
$1,457*
$999
$644
2000 2003 2006 2013
* Without Medicare drug benefit.SOURCE: Actuarial Research Corporation analysis for The Kaiser Family Foundation, June 2003 and November 2004.
Average annual out-of-pocket drug costs among the Medicare population:
Projected:
The Need for Drug Coverage
Trends in the Senior Market
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- 83%
- 28%
Part D is Projected to Reduce Average Out-of-Pocket Spending but the Extent of the Reduction is Likely to Vary
SOURCE: Actuarial Research Corporation analysis for the Kaiser Family Foundation, November 2004.
Average Change:
- 37%
All Other Part D Participants(20.3 million)
Part D Participants Who Receive Low-Income Subsidies
(8.7 million)
Recent Trends in the Senior Market
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Traditional Medicare
No Part D coverage Part D Prescription Drug Plan
Medicare Advantage
HMO (Local)
PPO (Local v. Regional)
Enroll in Part D Plan
Apply for Low-Income Subsidy
Medicaid Office
Social Security Office
Meet Income and Asset Test?Dual Eligibles
Below 100% FPL:
No premium or deductible, $1/generic Rx, $3/brand name Rx,
pay nothing after $5,100 in Rx costs
Below 135% FPL: Subsidy for premium, no
deductible, $2/generic Rx, $5/brand name Rx, pay nothing
after $5,100 in Rx costs
Below 150% FPL: Subsidy for premium on sliding scale,
$50 deductible, 15% coinsurance to $5,100 in Rx costs, $2/generic Rx,
$5/brand name Rx after $5,100
If yes, qualify for:
Private FFS
Decisions for Beneficiaries
Part D Benefits & Guidelines
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Medicare Prescription Drug Benefit
$ 2 5 0 $ 2 2 5 0 $ 5 1 0 0
$ +
B e n e f ic ia r y L ia b i l i ty
D e d u c t ib le
C o v e r a g e G a p
T o ta l S p e n d in g
? 9 5 %
8 0 % R e in s u r a n c e
1 5 % P la n P a y s 5 % C o in s u r a n c e
M e d ic a r e P a y s R e in s u ra n c e
7 5 % P la n P a y s
2 5 % C o in s u r a n c e
D ire c t S u b s id y /B e n e f ic ia r y P r e m iu m
$ 7 5 0 $ 3 6 0 0 T r O O P
T o ta l B e n e f ic ia r y
O u t - O f - P o c k e t$ 2 5 0
R e d u c t io n in th e d e d u c t ib le C h a n g e s in c o s t-s h a r in g (e .g . , t ie re d
c o p a y m e n ts o r c o in s u ra n c e in a n a c tu a r ia l ly e q u iv a le n t m a n n e r to th e 2 5 % c o s t s h a r in g u n d e r s ta n d a rd c o v e ra g e
M o d if ic a t io n o f in it ia l c o v e ra g e lim it
R e d u c t io n s in c o s t s h a r in g :– R e d u c t io n in d e d u c t ib le– R e d u c t io n in th e c o in s u ra n c e
p e rc e n ta g e o r c o p a y m e n ts– In c re a s e in in it ia l c o v e ra g e lim it
C o v e ra g e o f d ru g s s p e c if ic a lly e x c lu d e d a s c o v e re d P a r t D d ru g s
B a s ic A lte r n a t iv e C o v e r a g e( A c tu a r ia l ly E q u iv a le n t to S ta n d a r d C o v e r a g e )
E n h a n c e d A lte r n a t iv e C o v e r a g e(E x c e e d s S ta n d a r d C o v e r a g e )
S ta n d a r d C o v e r a g e(E s t im a te d A n n u a l P r e m iu m : $ 4 2 0 )
1 0 0 % C o in s u r a n c e( )
2006 Standard Medicare Part D Coverage
Part D Benefits & Guidelines
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Part D Plans
To participate in the program, sponsors must offer Medicare Part D benefits to all beneficiaries in one or more of the 34 PDP regions established by CMS
Plan Participation
![Page 11: BCNEPA/FPH 2006 Seminar Medicare Before and After Part D April 26, 2006 Randy Grabiak Highmark Senior Products Medicare Part D Product Director](https://reader036.vdocuments.net/reader036/viewer/2022081519/56649de75503460f94ae06d8/html5/thumbnails/11.jpg)
Highmark’s Medicare Approved Drug Plans
BlueRx Benefits
Basic Plus Complete
Formulary Closed Incentive Incentive
Monthly Premium $26.55 $33.67 $47.46
Deductible $0.00 $0.00 $0.00
Initial Coverage
From deductible amount to $2,250 in total drug costs (member and plan)
Generic
$10 Copay
Brand
$30 Copay
Generic
$10 Copay
Brand
$25/$45 Copay
Generic
$8 Copay
Brand
$20/$40 Copay
Coverage Gap
From $2,251 in total drug costs (member and plan) to $3,600 out-of-pocket (member)
No Coverage No Coverage
$8 Copay for
Unlimited Generics
No Coverage
Catastrophic Coverage
Over $3,600 out-of-pocket (member)
Generic
Greater of $2 Copay or 5% Coinsurance
Brand
Greater of $5 Copay or 5% Coinsurance
Generic
Greater of $2 Copay or 5% Coinsurance
Brand
Greater of $5 Copay or 5% Coinsurance
Generic
Greater of $2 Copay or 5% Coinsurance
Brand
Greater of $5 Copay or 5% Coinsurance
To Request Additional Information, please call 1-866-465-4030
Plan Participation
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Standard Part D Enhanced Part D
FreedomBlue FreedomBlue
Formulary Closed Closed
Deductible $0.00 $0.00
Initial Coverage
From deductible amount to $2,250 in total drug costs (member and plan)
Generic
$10 Copay*
Brand
$30 Copay*
Generic
$8 Copay*
Brand
$20 Copay*
Coverage Gap
From $2,251 in total drug costs (member and plan) to $3,600 out-of-pocket (member)
No Coverage $8 Coverage for Generics*
Catastrophic Coverage
Over $3,600 out-of-pocket (member)
Generic
Greater of $2 Copay * or
5% Coinsurance
Brand
Greater of $5 Copay* or
5% Coinsurance
Generic
Greater of $2 Copay* or
5% Coinsurance
Brand
Greater of $5 Copay* or
5% Coinsurance
Generic
Greater of $2 Copay* or
5% Coinsurance
Brand
Greater of $5 Copay* or
5% Coinsurance
Generic
Greater of $2 Copay* or
5% Coinsurance
Brand
Greater of $5 Copay* or
5% Coinsurance
Highmark’s Medicare Advantage Drug Plan Options
* Based on 1-34 Day supply. Copayment for 35-90 day supply (Retail) or 1-90 day supply (Mail Service) is 2.5 times 1-34 day supply.
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Medicare Prescription Drug Plan Cost Estimator (BlueRx Basic)
Current Annual Drug Spend $1,440.00$120.00/Month
Est. Annual Medicare Drug Spend $ 798.60$66.55/Month
Est. Annual Savings: $ 641.40$53.45/Month
Description Cost with Medicare
Minimum Annual Premium* $318.60$ 26.55/Month
Cost Share applied toward the $250 Deductible $0.00
Annual Cost Share ** $480.00$40.00/Month
Estimated Savings Report:
Cost Breakdown:
*BlueRx Basic Plan** Assumption: 4 generic prescriptions/month
Part D Benefits & Guidelines
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Low-Income Subsidy
• Medicare will provide premium and cost-sharing subsidies to assist low-income beneficiaries
• Dual eligibles will be automatically assigned to a PDP and auto-enrolled if they do not choose another plan
• Benefit: Reduction of premium, deductible & cost-sharing
• Process: Requires completion of SSA form
• Eligibility:
Income Assets*
Single $14,355 $11,500
Married $19,245 $23,000
*Excludes primary residence and automobiles
Part D Benefits & Guidelines
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Medicare’s Low Income Subsidy Benefit Design
Title Income Assets Premium Deductible Initial Benefit
Coverage Gap
Catastrophic
Coverage
(1) Full-Benefit
Dual Eligible Non-
Institutionalized
Up to 100% FPL
Medicaid Eligible $0.00 $0.00 $1 generic
$3 brand
$1 generic
$3 brand
$0.00
(2) Full-Benefit
Dual Eligible Non-
Institutionalized
Above 100% FPL
Medicaid Eligible $0.00 $0.00 $2 generic
$5 brand
$2 generic
$5 brand
$0.00
(2) Other Low-Income
Beneficiary
Below 135% FPL
Not Above
$6,000 (single)
$9,000 (couple)
$0.00 $0.00 $2 generic
$5 brand
$2 generic
$5 brand
$0.00
(3) Other Low-Income
Beneficiary
Below 135% FPL
Between
$6,000 & $10,000 (single)
$9,000 & $20,000 (couple)
$0.00 $50 15% co- insurance
15% co- insurance
$2 generic
$5 brand
(3) Other Low-Income
Beneficiary
At or above 135% FPL but below 150% FPL
Not above
$10,000 (single)
$20,000 (couple)
Sliding Scale up to 100%
$50 15% co- insurance
15% co- insurance
$2 generic
$5 brand
(4) Full-Benefit
Dual Eligible
Institutionalized
Irrelevant Medicaid Eligible $0.00 $0.00 $0.00 $0.00 $0.00
Part D Benefits & Guidelines
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The Donut Hole’s Impact to Out of Pocket Expenses
Part D Benefits & Guidelines
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$1
$1
84
$3
67
$5
50
$7
33
$9
16
$1
,09
9
$1
,28
2
$1
,46
5
$1
,64
8
$1
,83
1
$2
,01
4
$2
,19
7
$2
,38
0
$2
,56
3
$2
,74
6
$2
,92
9
$3
,11
2
$3
,29
5
$3
,47
8
$3
,66
1
$3
,84
4
$4
,02
7
$4
,21
0
$4
,39
3
$4
,57
6
$4
,75
9
$4
,94
2
$5
,12
5
$5
,30
8
$5
,49
1
$5
,67
4
$5
,85
7
$6
,04
0
$6
,22
3
$6
,40
6
$6
,58
9
$6
,77
2
$6
,95
5
W/o
W/
$0 $250 $2250 $5100 $7000
Annual Initial Donut Hole CatastrophicDeductible Benefit No Coverage of Costs Coverage
W/O
W/
< 100% FPL - $1/3 <135% - $2/5
135%-150%Low Income
Average Senior
Total Prescriptions Received
Ou
t of
Poc
ket
Exp
ense
s
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Medicare Part D is an entitlement but enrollment is voluntary
Low-income subsidy provides additional cost savings
Waiting to enroll until after May 15, 2006 may come at a penalty
Nov 15, 2005 May 15, 2006
Sign up & pay = $32.20/Month*
*Amount based on $32.20 national average monthly beneficiary premium (CMS, August 2005).**Assumes national average premium does not increase annually
January 2007 January 2008
Sign up & pay = $34.78/Month**
Sign up & pay = $38.95/Month**
Late Enrollment Penalty
Part D Benefits & Guidelines
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National Part D Enrollment not meeting HHS Projections
0.0
20.0
10.0
30.0 *Projected Part D Enrollment = 29.3M
6.2 mil
4.4 mil 4.5 mil
1 mil3.6 mil
Dec 2005 Jan 2006
Enrolled in Stand Alone PDPs
Enrolled in MA-PD
Dual Eligible Auto Assigned from CMS
Actual Part D EnrollmentSource: Projected: HHS, Medicare Drug Benefit Final Rule 1/28/05. Actual: HHS 12/22/05, 1/17/06 , 2/22/06, & 3/23/06
11.6 million
14.3 million
• 39.1 million beneficiaries would enroll in 2006 of which 10 million would have creditable coverage under a qualified plan such as an employer or union sponsored plan.
• 29.3 million would be enrolled in a Part D plan.
• Additional 11.4 million will need to sign up for a stand alone or MAPD plan in order to reach the 29.3 million member target.
Feb 2006
6.2 mil
4.7 mil
4.9 mil
15.8 million
6.2 mil
*Includes MAPD & Stand Alone PDP17.9
million
6.4 mil
5.1 mil
6.4 mil
Mar 2006
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Formulary
– Over the counter medications
– Weight gain and loss drugs
– Fertility and cosmetic/hair growth drugs
– Drugs to relieve cold symptoms
– Some vitamins and minerals
– Barbiturates, and benzodiazepines
– Antidepressants
– Antipsychotics
– Anticonvulsants
– Antiretrovirals
– Immunosuppressants
– Antineoplastics.
Statutory ExclusionsCovered Drugs
Prescription Drug Plans Must:
Assure a broad access to drugsRequire two drugs per Categories & Classes
Must comply with USP model guidelines
Provider Challenges
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Drug coverage can differ based on how the drug is prescribed dispensed or administered to the patient
Formulary
Provider Challenges
Inhalation DME supply drugs – solution for inhalation via nebulizer only
Oral Anti-cancer agents
Diabetic test strips & lancets
Influenza, pneumococcal, Hepatitis B vaccines
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Exceptions & Appeals Process
• Plans must have a drug transition process in place to assure a seamless transition for patients– A 90 day period may be needed for patients taking non formulary drugs
– For rapid transitions, beneficiaries may need to use a plan’s exceptions & appeals process
– Establish an adequate exceptions process to help LTC residents who need non formulary drugs
– Provide a one time temporary or emergency supply to ensure that there is no coverage gap during the exceptions process
Provider Challenges
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Medication Therapy Management
Provider Challenges
MTM programs must be designed to assure that covered medications will be used appropriately by targeted beneficiaries. A plan’s MTM services must be developed in cooperation with licensed and practicing pharmacists and physicians.
Optimize therapeutic outcomes
Improve medication use
Reduce risk of adverse events & interactions
Increase patient’s adherence & compliance with regimens
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Key Date
May 15, 2006 – The last day that current Medicare eligible beneficiaries can join a drug plan without paying a penalty.
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Message Points for Providers
• Patients will ask you for advice
• One plan does not fit all Medicare beneficiaries
• Evaluate Drug Benefit Cost Sharing
• Encourage patients to look into low income subsidies
• Premium Penalty for delay in signing up
• Advise to compare formularies and pharmacy networks
• Know where to tell patients to turn for more information
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Where to Turn for More information:
• Highmark– 1-866-465-4030
– www.highmarkblueshield.com
• Medicare– 1-800-MEDICARE
– www.medicare.gov & www.cms.gov
– www.medicare.gov/medicarereform/minitool.asp
• Social Security Administration– 1-800-772-1213
– www.socialsecurity.gov