Beneficiaries Should Be Allowed To Switch Drug Plans
Beneficiaries enrolled in the Medicare prescription drug benefit should be allowed to change plans after they sign up, health policy experts said on Friday at an event sponsored by the Alliance for Health Reform, CQ HealthBeat reports. Under the 2003 Medicare law, beneficiaries who enroll in a Medicare Advantage drug plan cannot switch plans for one year after enrollment.
Brian Biles, a professor in the Department of Health Policy at George Washington University, said the current policy should be suspended until new limits are set on out-of-pocket costs and risk adjustments are implemented. Biles presented data showing that the sickest 5% of Medicare beneficiaries pay 43% of total costs, while the healthiest 50% pay 4% of total costs. Medicare overpays for healthy beneficiaries by $180 annually and underpays for the sickest beneficiaries by $4,200, according to Biles.
Marsha Gold, a senior fellow at Mathematica Policy Research, said November 2005 data from CMS show that 8% of beneficiaries in Medicare Advantage plans paid no premium for regional PPOs and 43% paid no premium for HMOs.
Karen Ignagni, president of America's Health Insurance Plans, said her group supports allowing beneficiaries to change plans. The current policy discourages beneficiaries from enrolling, she said. However, she added that there is a high satisfaction rate among beneficiaries in MA plans.
Ignagni presented data indicating less than 2% of beneficiaries in MA plans have disenrolled. "It's clear that a number of individuals looked at Medicare Advantage plans and made a judgment based not on experience but on a political basis," she said.
Abby Block, director of the Center for Beneficiary Choices at CMS, did not take a position on ending the current policy (Hopkins, CQ HealthBeat, 5/19).
In related news, Knight Ridder/Arizona Daily Star on Friday examined how Medicare officials are "bracing for what could be a significant public-relations hurdle" when "millions" of Medicare beneficiaries reach the so-called "doughnut hole" in coverage in many Medicare drug plans (Pugh, Knight Ridder/Arizona Daily Star, 5/21). Under the drug benefit, beneficiaries are responsible for 100% of total annual prescription drug costs between $2,250 and $5,100 (California Healthline, 5/11).
Beneficiaries continue to pay their regular monthly premiums in the doughnut hole. CMS actuaries had estimated that about 5.3 million beneficiaries would reach the doughnut hole, but officials now project that the number will be lower because of lower-than-expected drug prices and higher-than-expected enrollment in plans without coverage gaps. However, the Kaiser Family Foundation has estimated that 6.9 million beneficiaries in plans with coverage gaps will reach the doughnut hole.
The figure actually could be much higher because of high enrollment, according to a researcher at the foundation (Knight Ridder/Arizona Daily Star, 5/21).