Leavitt, McClellan Answer Questions About Medicare in Conference Call

HHS Secretary Mike Leavitt on Tuesday in a conference call with reporters said the department is working to address problems with the new Medicare prescription drug benefit, including increasing the number of telephone operators to assist pharmacies working with Medicare beneficiaries from 150 on Jan. 1 to 4,500, the Detroit News reports (Herrndobler, Detroit News, 1/18). He also reiterated that the government has instructed insurers to cover a 30-day supply of drugs, regardless if the medications are on the plan's formulary, and to limit copayments.

Leavitt added that, as a last resort, beneficiaries could be enrolled in a default prescription drug plan while at a pharmacy. He said, "Our message [to beneficiaries] is, 'Don't leave the pharmacy without your drugs'" (Schuler/Reichard, CQ HealthBeat, 1/17). He added, "There is no reason for you to go without your medicines ... or for you to have to pay more than you owe" (Appleby/Wolf, USA Today, 1/18).

Leavitt added, "When there's change, there's an opportunity for things to go wrong. We are fixing them one pharmacy, one beneficiary at a time" (Pear, New York Times, 1/18).

Leavitt and CMS Administrator Mark McClellan said "tens of thousands" of low-income beneficiaries have experienced problems obtaining drugs (USA Today, 1/18).

"We are likely to see these problems on an ongoing basis until everyone has used their card at least once," he said (New York Times, 1/18). He continued, "Some people may experience a problem the first time they go to get their medicines, but we're confident that, after [they] use it once, things are going to go more smoothly" (Lipman, Atlanta Journal-Constitution, 1/18).

The Bush administration said a total of 3.6 million had voluntarily signed up for the Medicare prescription drug benefit in stand-alone drug plans (New York Times, 1/18). A total of 24 million people -- including those who previously received drug coverage through Medicaid programs or employer-sponsored retiree plans -- now have drug coverage, the Post reports.

The administration is "well on track to meet [its] goal of enrolling 28 to 30 million in the first year," Leavitt said. He added, "For the vast majority of people who are enrolled in the drug benefit, the system's working" (Connolly, Washington Post, 1/18).

The federal government will not reimburse states that are covering the cost of prescription drugs for Medicare beneficiaries who are unable to obtain medications under the new drug benefit, McClellan said Tuesday, Knight Ridder/Miami Herald reports.

McClellan said, "Under this program, [CMS doesn't] have the authority to pay states directly," adding, "People are in Medicare drug plans and it's the Medicare plans that are supposed to pay for the medications" (Pugh, Knight Ridder/Miami Herald, 1/17).

Many dual eligibles -- those who are eligible for both Medicare and Medicaid and whose drug coverage automatically switched from Medicaid to Medicare -- have experienced problems obtaining prescriptions because of overcharges in copays or enrollment verification issues at pharmacies (New York Times, 1/18).

In response, at least 20 states have enacted emergency measures to ensure access to medications for dual eligibles, and some state leaders have called for the federal government to reimburse those costs (Knight Ridder/Miami Herald, 1/17).

Last weekend, CMS sent a directive to insurers that offer Medicare drug plans instructing them that they are required to provide beneficiaries with a 30-day emergency supply of any drugs they were taking before the Medicare prescription drug benefit began Jan. 1. In addition, CMS said insurers "must take immediate steps" to ensure that no low-income beneficiary is charged more than $2 for a generic drug and $5 for a brand-name drug (California Healthline, 1/17).

McClellan said the agency will assist state agencies in compiling and filing claims with Medicare drug plans (CQ HealthBeat, 1/17).

CMS spokesperson Gary Karr said, "If [drug plans are] not paying for the claim they should have, we can make sure they do."

As of Tuesday, "[s]ome state officials apparently were still unaware that Medicare wouldn't directly cover their emergency drug costs," according to Knight Ridder Herald.

Arkansas Gov. Mike Huckabee (R), chair of the National Governors Association, said the federal government "should accept responsibility to fix it rather than asking us to bail them out." He added, "And then when we do, to say, 'Gee thanks. As far as paying for it, good luck, you're on your own?' That kind of defies the old good-neighbor rule. They borrowed our lawn mower, and they gave us back a pair of scissors."

Huckabee said states are "doing the federal government a favor" and "in essence loaning them money while they get their problems worked out." He added, "Now we're going to not only become the bank, but the collection agency?" Huckabee said congressional action might be needed to allow states to get direct payments from Medicare if they have problems collecting payments from drug plans.

California Gov. Arnold Schwarzenegger (R) on Tuesday said, "We will press Washington to reimburse us for the costs and fix the problem once and for all" (Knight Ridder/Miami Herald, 1/17). He added, "Right now, the new Medicare ... program is not working as intended" (Washington Post, 1/18).

Stacey Ward, spokesperson for the state Department of Public Welfare in Pennsylvania, which is covering drug costs for dual eligibles, said, "We're confident we will be reimbursed" by insurers (Fahy/Snowbeck, Pittsburgh Post-Gazette, 1/18).

In a letter to administration officials, 14 Democratic governors called for reimbursement from the federal government, saying that the "unexpected cost to states will likely be in the hundreds of millions of dollars" (USA Today, 1/18). The governors added, "[W]hile well intended, the ... drug benefit has caused confusion, mismanagement and a bureaucratic nightmare" (Washington Post, 1/18).

Senate Finance Committee Chair Chuck Grassley (R-Iowa) said congressional hearings on the drug benefit are possible. "I am very troubled about stories of low-income beneficiaries having difficulty getting their prescriptions filled," Grassley said, adding that the transition of drug coverage for dual eligibles from Medicaid to Medicare is "the most challenging element of the new program" (USA Today, 1/18).

On Friday, 36 Senate Democrats wrote to Leavitt, saying, "We want to know why so many of our constituents have fallen though the cracks during the implementation" of the drug benefit (Detroit News, 1/18).

Sen. Frank Lautenberg (D-N.J.) last week said when Congress reconvenes he plans to introduce legislation that would require CMS to reimburse states for costs incurred as a result of "failures" by the federal government to implement the program (CQ HealthBeat, 1/17).

Sen. John Rockefeller (D-W.Va.) also plans to introduce legislation that would require reimbursement, CQ Today reports. In addition, Sens. Olympia Snowe (R-Maine) and Bill Nelson (D-Fla.) earlier this month introduced legislation that would extend the deadline by which beneficiaries can enroll in the drug benefit without penalty (Schuler, CQ Today, 1/17).

In the House, Rep. Jeb Bradley (R-N.H.) said on Friday he plans to introduce legislation that would give the federal government the authority to reimburse states. Rep. Henry Waxman (D-Calif.) has scheduled a press conference for Friday to release information on "problems with the Medicare program." According to CQ HealthBeat, members of Congress "could take the opportunity to revisit various parts of" the 2003 Medicare law authorizing the drug benefit (CQ HealthBeat, 1/17).

Karen Ignagni, president of America's Health Insurance Plans, said insurers are "committed to providing a 30-day transition supply" and "will definitely be willing to reimburse states for drug costs." She said disputes over the amount of reimbursements by insurers to the state might occur because states might have been paying more than the insurers would have paid on some claims (New York Times, 1/18).

Joe Antos, a health policy expert at the American Enterprise Institute, said, "This is absolutely one of the fully expected transition problems, and it will resolve itself." Antos said it likely will take weeks or months for the problems to be resolved.

On Friday, Steven Sharfstein, president of the American Psychiatric Association, said the drug benefit "is having a major impact on our patients with severe and persistent mental illnesses," adding, "Relapse, rehospitalization and disruption of essential treatment are some of the consequences of this bureaucratic nightmare" (CQ HealthBeat, 1/17).

Robert Hayes, president of the Medicare Rights Center, said, "The good news is more people signed up." He added, however, "there remains a huge gap between people who need help paying for medicine and this program's ability to help" (Pittsburgh Post Gazette, 1/18).

In other Medicare drug benefit news, the AP/Philadelphia Inquirer on Wednesday published a news analysis examining how the drug benefit "was supposed to win political points for Republicans" but has instead "exploded in their faces as this election year has begun" (Raum, AP/Philadelphia Inquirer, 1/18).

NPR's "All Things Considered" on Tuesday reported on enrollment in the Medicare prescription drug benefit. The segment includes comments from Jeanne Finberg, directing attorney at the National Senior Citizens Law Center; Jocelyn Guyer, senior program director at the Center for Children and Families and senior researcher at the Health Policy Institute at Georgetown University; Carol Herrmann-Stecker, Medicaid director for Alabama; Robert Laszewski, president of Health Policy and Strategy Associates; Leavitt; and McClellan (Rovner, "All Things Considered," NPR, 1/17). The complete segment is available online in RealPlayer.