One-Year Anniversary of New Medicare Law Marred by Bad News

The Bush administration, led by HHS Secretary Tommy Thompson, celebrated the one-year anniversary of the signing of the new Medicare law on Wednesday, but the enthusiasm was tempered by the "latest" bad news to emerge about implementation efforts, the Washington Times reports. "This anniversary marks a very historic event," Thompson said, adding, "We accomplished what this town couldn't for more than a decade" (Fagan, Washington Times, 12/9). He said, "We have kept the promise to provide better benefits and more savings to America's seniors and people with disabilities since President Bush signed the new Medicare bill into law" (Carey, CQ HealthBeat, 12/8).

CMS Administrator Mark McClellan said, "We're helping more beneficiaries faster than ever," noting that 5.8 million people have signed up for the new drug discount card program and are receiving savings of up to 21% off the average price of prescription drugs. Senate Majority Leader Bill Frist (R-Tenn.) said the new law is "the most significant improvement to the Medicare program since its inception" (Washington Times, 12/9). The celebration included taped testimonials from Medicare beneficiaries praising the new drug card program and $600 annual subsidy for low-income participants (Carey, CQ HealthBeat News, 12/8).

Rep. Tom Feeney (R-Fla.), one of 25 Republicans who voted against the new law, criticized the high cost of the law. According to White House Office of Management and Budget estimates released after Congress passed the Medicare law, the legislation will cost an estimated $534 billion over the next 10 years -- $134 billion more than previously estimated by the Congressional Budget Office. Feeney said, "I'm less concerned with one-year anniversaries than in what Medicare will look like on the 30th anniversary," adding, "Now it's time to analyze the long-term fiscal effects ... and I don't hear anyone saying it'll make things better."

Robert Moffit, director of domestic and economic policy at the Heritage Foundation, said, "It was a stunning act of fiscal irresponsibility. They've accelerated Medicare spending, deepened the financial problems of Medicare and they are crowding out existing private coverage."

HHS' celebration coincides with the "latest" hurdle officials have faced in implementing the new Medicare law, the Times reports. The Government Accountability Office on Wednesday released a report detailing problems with the toll-free hotline CMS established to help answer beneficiaries' questions about the program (Washington Times, 12/9). The hotline, which has been "tout[ed]" by Bush administration officials as a way for Medicare beneficiaries to learn more about the drug card program, is staffed by private contractors who work from scripts developed by CMS, the AP/Arizona Daily Star reports.

GAO conducted the investigation -- which was mandated by the Medicare law -- by placing 420 calls to the hotline, asking questions related to the drug card program, supplemental Medigap policies and coverage for doctor visits, eye exams and wheelchairs (AP/Arizona Daily Star, 12/9). According to the report, GAO callers received inaccurate answers to questions about 29% of the time. Most of the inaccurate information provided to callers related to questions that did not fall within the pre-written scripts, GAO found (Carey, CQ HealthBeat News, 12/8). According to the AP/Star, the "worst performance" was related to questions about the $600 annual subsidy that low-income beneficiaries receive when they enroll in the drug card program. Operators answered questions about the subsidy incorrectly 55 out of 70 times, according to the report (AP/Arizona Daily Star, 12/9). In addition, GAO investigators found that they were unable to obtain any answers to questions 10% of the time because they were transferred to other Medicare contractors that were closed or because calls were inadvertently disconnected (Carey, CQ Today, 12/8).

The GAO recommended a number of improvements to the hotline, including revising procedures so that calls are not rerouted to closed contractors; reviewing, rewriting and testing operators' scripts to ensure they are accurate and understandable; and testing operators more frequently to ensure they can answer questions correctly and retraining them if necessary.

In a written response to the GAO report, McClellan agreed with the recommendations and said CMS is in the process of correcting some of the hotline's problems. He noted that the agency recently implemented new caller rerouting plans (Carey, CQ HealthBeat News, 12/8). McClellan also said that the hotline's more than 3,000 operators have "faced a deluge of calls" in the past year, the AP/Star reports. According to CMS spokesperson Gary Karr, call centers received 16.5 million calls in the 12 months that ended Sept. 30, up from 5.6 million the year before (AP/Arizona Daily Star, 12/8). In May 2004, the hotline received 3.8 million calls because of increased interest in the drug card program, McClellan said, adding, "We believe we responded as well as we reasonably could given the unique and demanding circumstances" (Carey, CQ HealthBeat News, 12/8).

Sen. Chuck Grassley (R-Iowa) called for an immediate fix to the problems with the hotline. He said, "There's no time to waste. This help line will be an even more important resource for Medicare beneficiaries and their families a year from now, when the new voluntary prescription drug benefit becomes available" (Washington Times, 12/9). The GAO report is available online. Note: You must have Adobe Acrobat Reader to view the report.

In related news, CMS on Wednesday launched a new effort to enroll Medicare beneficiaries in the discount drug card program to ensure that the greatest number of low-income beneficiaries receive the $600 annual subsidy available for 2004 before it expires on Dec. 31. Beneficiaries who enroll after Dec. 31 will still be eligible for the $600 subsidy for 2005. So far, about 1.4 million beneficiaries eligible for the subsidy have enrolled in the drug card program, but that represents only a small fraction of the seven million or more who qualify for the subsidy, according to CMS spokesperson Peter Ashkenaz.

To increase participation, CMS now will allow beneficiaries to enroll in the program by telephone through the Medicare hotline or through the Medicare Web site. In addition, the Access to Benefits Coalition, which is working to increase enrollment in the program, has established local phone lines in selected locations to help beneficiaries enroll. "We're really trying to make it as easy as possible to enroll," Ashkenaz said (Wolfe, Minneapolis Star Tribune, 12/9).

Meanwhile, a survey by Republican pollster Linda DiVall found that only 50% of seniors are aware of the new Medicare prescription drug benefit, and only 33% say they expect to sign up for it, according to CQ HealthBeat News. The survey, sponsored by the Federation of American Hospitals, polled 1,000 election-day voters between Nov. 17 and 21. Participant "opinions of the Medicare drug benefit are nowhere what they need to be for this program to be successful," DiVall said, adding that the enrollment rate must be at least 80% for the drug benefit to be viable. The poll also found that seniors were "largely unaware" of the new preventive care coverage available under the new Medicare law, although 85% said they were in favor of the benefits once told what they were. The coverage includes a "Welcome to Medicare" physical examination, blood tests for cardiovascular disease and screening tests for diabetes. The findings show that the Bush administration "would be well-advised to carefully examine the case study of Medicare reform before moving to Social Security reform," DiVall said. She called on the administration to educate beneficiaries about the new benefits.

Chip Kahn, president of FAH, said Bush should take a central role in promoting the new Medicare law. In response to the survey, Thompson said he was "not at all surprised" that a poll taken 13 months prior to the launch of the drug benefit found low awareness levels, adding that the drug benefit likely will receive additional press now that the election is over and the Bush administration's "outreach is going to get better" (Reichard, CQ HealthBeat News, 12/8).

NBC's "Nightly News" on Wednesday reported on the Medicare hotline. The segment includes comments from Grassley and Robert Hayes, president of the Medicare Rights Center (Reid, "Nightly News," NBC, 12/8). The complete segment is available online in Windows Media.