Oversight of Medicare Drug Benefit Faulted at U.S. Senate Hearing

Lawmakers at a Senate Finance Committee hearing on Tuesday criticized CMS for the agency's oversight of Medicare's prescription drug benefit and for its efforts to protect seniors from administrative problems and aggressive sales tactics, Dow Jones reports (Mantell, Dow Jones, 5/8).

Problems discussed at the hearing included complaints about the 1-800-MEDICARE information hot line and payment issues between health plans and pharmacists (Carey, CQ HealthBeat, 5/8). Other pharmacy concerns discussed included low reimbursement levels and lack of pricing transparency, which can be more pronounced in rural settings and in settings with large populations of low-income or uninsured patients (Dow Jones, 5/8).

Tuesday's hearing coincided with the release of two Government Accountability Office reports, one of which found that Medicare paid prescription drug plans $100 million in 2006 for retroactive reimbursements for dual eligible beneficiaries that never were distributed. The second report found that 4.7 million Medicare beneficiaries are eligible but not enrolled in the program's low-income subsidy (CQ HealthBeat, 5/8).

Witnesses at the hearing said that the Social Security Administration could identify greater numbers of Medicare beneficiaries who qualify for the subsidy if it were able to work with the Internal Revenue Service.

Barbara Bovbjerg, GAO's director of education, workforce and income security issues, said SSA could identify potential participants from a pool of 19 million from 1099 tax forms.

However, current law prohibits the IRS from sharing information from tax forms unless an individual has submitted an application for the subsidy (CongressDaily, 5/9).

Beatrice Disman, chair of SSA's Medicare Planning and Implementation Task Force, and Abby Block, director of the Center for Beneficiary Choices with CMS, said their agencies are working to resolve issues with the program and asked senators to send specific complaints to the agencies (CQ HealthBeat, 5/8).

Block said it is too early to discuss legislative solutions to problems with the drug benefit, adding that the agencies would "like a little more time to see how things work and to determine what is working well." She added, "We have zero tolerance for ripping seniors off. I am as concerned and disturbed as you are by some of the allegations."

Senate Finance Committee Chair Max Baucus (D-Mont.) said, "I just don't get the feeling that CMS is rigorously protecting seniors. Frankly, there is a very deep sense that CMS is not sufficiently scrutinizing private plans."

Committee ranking member Chuck Grassley (R-Iowa) said that "there are some persistent problems that should have been fixed by now," noting that he is particularly concerned about issues with pharmacies (Dow Jones, 5/8).

C-SPAN on Tuesday broadcast the hearing.

Video of the hearing is available online.