Medicare Verification Problems Mark Launch of Rx Drug Benefit

Difficulties with enrollment verification, computer glitches and other problems with the launch of the new Medicare prescription drug benefit on Monday led to delays in prescriptions for many beneficiaries, USA Today reports (Koch, USA Today, 1/4). According to CMS, more than one million Medicare beneficiaries have obtained prescriptions since the prescription drug benefit took effect, but the problems with the program "are forcing thousands of people to get by on short doses or pay out-of-pocket for their drugs," the Wall Street Journal reports.

The "problems largely involve customers who haven't yet received their new drug cards" or enrollment letters, the Journal reports (Adamy, Wall Street Journal, 1/4).

CMS spokesperson Peter Ashkenaz added that a high volume of enrollment in the Medicare prescription drug benefit in late December 2005 contributed to the problems because many beneficiaries who enrolled at that time did not receive their cards or letters by Jan. 1 (Heldt Powell, Boston Herald, 1/4).

Pharmacists must verify enrollment for Medicare beneficiaries who attempt to fill prescriptions without cards or letters through a national computer system or through a telephone call to the administrator of their prescription drug plans. However, pharmacists said that they often received busy signals when they attempted to call prescription drug plan administrators.

Walgreen, the largest U.S. pharmacy chain, and CVS, the second largest chain, also reported glitches in the national computer system that prevented enrollment verification. Both companies said that they have dispensed two- and three-day supplies of medications at no cost to Medicare beneficiaries whose enrollment pharmacists could not verify.

Walgreen said that the computer glitches began on Monday but had begun to decrease by Tuesday afternoon, and CVS said that the glitches had continued through late Tuesday.

Robert Borchert, a spokesperson for NDCHealth, which administers the national computer system, cited "a slowdown in the processing time" for some enrollment verification requests because of high volume. "We don't believe there's been any major glitches," Borchert said.

However, Walgreen spokesperson Mike DeAngelis said, "The system was certainly overwhelmed" (Wall Street Journal, 1/4).

Larry Kocot, a senior adviser at CMS, said the computer glitches were resolved by Tuesday.

CMS spokesperson Gary Karr said, "This is going very well," adding, "It's not a magic system" (USA Today, 1/4).

Bruce Roberts, CEO of the National Community Pharmacists Association, said, "We knew it was going to be difficult, but people are getting their medicine, and that is the bottom line" (Freking, AP/Detroit News, 1/4).

Pharmacists said that the launch of Medicare prescription drug benefit on New Year's Day also contributed to the problems because many physician offices were closed. In addition, many Medicare beneficiaries refill prescriptions on the first day of the month, and many employers change health plans on Jan. 1 (Wall Street Journal, 1/4).

Pharmacists also reported that some Medicare beneficiaries were unaware they had to meet a deductible or were confused by other parts of their prescription drug plans (USA Today, 1/4).

In related news, USA Today on Wednesday examined the differences in tiered price systems for Medicare prescription drug plans and private plans. According to an analysis conducted by research firm Avalere Health, most working-age adults with health insurance have prescription drug plans with two or three tiers of copayments.

About 40% of Medicare prescription drug plans have coverage with four tiers, and 14% have five tiers, the analysis finds. In the Medicare prescription plans, the fourth tier in most cases includes higher-cost medications -- such as treatments for rheumatoid arthritis, anemia and multiple sclerosis -- and requires beneficiaries to cover 25% to 33% of the cost, according to the analysis.

However, in private prescription drug plans, the highest tiers in most cases include treatments for non-life-threatening conditions such as hair loss or erectile dysfunction, according to Avalere President Daniel Mendelson.

According to USA Today, Medicare beneficiaries "taking fourth-tier drugs will quickly go through their initial coverage period and hit the so-called doughnut hole in coverage, where they pay the full cost of their drugs."

CMS officials said that the Medicare prescription drug plans will provide substantial savings for beneficiaries who previously lacked coverage.

"Overall, the savings will be high," Ashkenaz said (Appleby, USA Today, 1/4).

NPR's "All Things Considered" on Tuesday included an interview with Alan Julius -- a pharmacist at Valley Pharmacy in Cherokee, Iowa -- about how the launch of the Medicare prescription drug benefit has worked in his pharmacy (Norris, "All Things Considered," NPR, 1/3). The complete segment is available online in RealPlayer.