Presentation on theme: "Agenda Trends in the Senior Market Part D Benefits & Guidelines"— Presentation transcript:
0 BCNEPA/FPH 2006 Seminar Medicare Before and After Part D BCNEPA/FPH 2006 Seminar Medicare Before and After Part D April 26, 2006Randy GrabiakHighmark Senior ProductsMedicare Part D Product Director
1 Agenda Trends in the Senior Market Part D Benefits & Guidelines Plan ParticipationProvider ChallengesQuestions
2 Seniors’ Sources of Information Trends in the Senior MarketSeniors’ Sources of InformationAMONG SENIORS: Percent who say they would be very likely to turn to each of the following for help in deciding whether to enroll in a Medicare drug plan…Survey March 31 – April 3, 2005Your doctorYour pharmacistA Social Security office, website or phone numberFriends or family membersA Medicare mailing, website or phone numberA health insurance companyA local seniors’ group or community organizationAn employer or union49%33%27%27%23%21%18%8%Survey October 13 – 31, 2005MedicareYour doctorYour pharmacistSocial SecurityFriends or family membersA local seniors’ group or community organizationMedicaidAn employer or union33%32%25%24%20%16%14%9%Source: *Kaiser Family Foundation Health Poll Report Survey (conducted Mar. 31-April 3, 2005)**Kaiser Family Foundation/Harvard School of Public Health (conducted October 13-31, 2005)
3 Health Insurance Trends Prior to Part D Trends in the Senior MarketHealth Insurance Trends Prior to Part DTo offset the growing out-of-pocket expense, many beneficiaries have turned to various forms of private or public supplemental coverage to help defray the cost of prescription drugsHowever, more than a third still have no prescription drug coverageLack of drug coverage can have adverse affectsSources of Prescription Drug Coverage
4 Health Care Delivery and Expenditure Trends Trends in the Senior MarketHealth Care Delivery and Expenditure TrendsSeniors are particularly vulnerable to the increased cost of prescription drugs because:Drug usage increases with agePrior to Part D Medicare did not cover most prescription drugsSource: Ageworks, a division of the Ethel Percy Andrus Gerontology Center, USC
5 Trends in the Senior Market The Need for Drug CoverageMedicare Beneficiaries’ Out-of-Pocket Prescription Drug Spending,Average annual out-of-pocket drugcosts among the Medicare population:Projected:* Without Medicare drug benefit.SOURCE: Actuarial Research Corporation analysis for The Kaiser Family Foundation, June 2003 and November 2004.
6 Recent Trends in the Senior Market Part D is Projected to Reduce Average Out-of-Pocket Spending but the Extent of the Reduction is Likely to VaryPart D Participants Who Receive Low-Income Subsidies (8.7 million)All Other Part D Participants (20.3 million)Average Change: - 37%SOURCE: Actuarial Research Corporation analysis for the Kaiser Family Foundation, November 2004.
7 Decisions for Beneficiaries Part D Benefits & GuidelinesDecisions for BeneficiariesEnroll in Part D PlanTraditional MedicareMedicare AdvantagePart D Prescription Drug PlanHMO (Local)PPO (Local v. Regional)Private FFSNo Part D coverageApply for Low-Income SubsidyDual EligiblesSocial Security OfficeMedicaid OfficeMeet Income and Asset Test?If yes, qualify for:Below 100% FPL:No premium or deductible, $1/generic Rx, $3/brand name Rx, pay nothing after $5,100 in Rx costsBelow 135% FPL: Subsidy for premium, no deductible, $2/generic Rx, $5/brand name Rx, pay nothing after $5,100 in Rx costsBelow 150% FPL: Subsidy for premium on sliding scale, $50 deductible, 15% coinsurance to $5,100 in Rx costs, $2/generic Rx, $5/brand name Rx after $5,100
8 Medicare Prescription Drug Benefit Part D Benefits & GuidelinesMedicare Prescription Drug Benefit2006 Standard Medicare Part D Coverage
9 Part D Plans Plan Participation To participate in the program, sponsors must offer Medicare Part D benefits to all beneficiaries in one or more of the 34 PDP regions established by CMS
10 Highmark’s Medicare Approved Drug Plans Plan ParticipationHighmark’s Medicare Approved Drug PlansBlueRx BenefitsBasicPlusCompleteFormularyClosedIncentiveMonthly Premium$26.55$33.67$47.46Deductible$0.00Initial CoverageFrom deductible amount to $2,250 in total drug costs (member and plan)Generic$10 CopayBrand$30 Copay$25/$45 Copay$8 Copay$20/$40 CopayCoverage GapFrom $2,251 in total drug costs (member and plan) to $3,600 out-of-pocket (member)No Coverage$8 Copay for Unlimited GenericsCatastrophic CoverageOver $3,600 out-of-pocket (member)Greater of $2 Copay or 5% CoinsuranceGreater of $5 Copay or 5% CoinsuranceTo Request Additional Information, please call
11 Highmark’s Medicare Advantage Drug Plan Options Standard Part DEnhanced Part DFreedomBlueFormularyClosedDeductible$0.00Initial CoverageFrom deductible amount to $2,250 in total drug costs (member and plan)Generic$10 Copay*Brand$30 Copay*$8 Copay*$20 Copay*Coverage GapFrom $2,251 in total drug costs (member and plan) to $3,600 out-of-pocket (member)No Coverage$8 Coverage for Generics*Catastrophic CoverageOver $3,600 out-of-pocket (member)Greater of $2 Copay * or 5% CoinsuranceGreater of $5 Copay* or 5% CoinsuranceGreater of $2 Copay* or 5% CoinsuranceGreater of $5 Copay* or 5% CoinsuranceGreater of $5 Copay* or 5% CoinsuranceGreater of $2 Copay* or 5% CoinsuranceGreater of $5 Copay* or 5% Coinsurance* Based on 1-34 Day supply. Copayment for day supply (Retail) or 1-90 day supply (Mail Service) is 2.5 times 1-34 day supply.
12 Medicare Prescription Drug Plan Cost Estimator (BlueRx Basic) Part D Benefits & GuidelinesMedicare Prescription Drug Plan Cost Estimator (BlueRx Basic)Estimated Savings Report:Current Annual Drug Spend$1,440.00$120.00/MonthEst. Annual Medicare Drug Spend$$66.55/MonthEst. Annual Savings:$$53.45/MonthCost Breakdown:DescriptionCost with MedicareMinimum Annual Premium*$318.60$ /MonthCost Share applied toward the $250 Deductible$0.00Annual Cost Share **$480.00$40.00/Month*BlueRx Basic Plan** Assumption: 4 generic prescriptions/month
13 *Excludes primary residence and automobiles Part D Benefits & GuidelinesLow-Income SubsidyMedicare will provide premium and cost-sharing subsidies to assist low-income beneficiariesDual eligibles will be automatically assigned to a PDP and auto-enrolled if they do not choose another planBenefit: Reduction of premium, deductible & cost-sharingProcess: Requires completion of SSA formEligibility:IncomeAssets*Single$14,355$11,500Married$19,245$23,000*Excludes primary residence and automobiles
14 Medicare’s Low Income Subsidy Benefit Design Part D Benefits & GuidelinesMedicare’s Low Income Subsidy Benefit DesignTitleIncomeAssetsPremiumDeductibleInitial BenefitCoverage GapCatastrophicCoverage(1) Full-BenefitDual Eligible Non-InstitutionalizedUp to 100% FPLMedicaid Eligible$0.00$1 generic$3 brand(2) Full-BenefitAbove 100% FPL$2 generic$5 brand(2) Other Low-IncomeBeneficiaryBelow 135% FPLNot Above$6,000 (single)$9,000 (couple)(3) Other Low-IncomeBetween$6,000 & $10,000 (single)$9,000 & $20,000 (couple)$5015% co- insuranceAt or above 135% FPL but below 150% FPLNot above$10,000 (single)$20,000 (couple)Sliding Scale up to 100%(4) Full-BenefitDual EligibleIrrelevant
15 The Donut Hole’s Impact to Out of Pocket Expenses Part D Benefits & GuidelinesThe Donut Hole’s Impact to Out of Pocket Expenses
16 Late Enrollment Penalty Part D Benefits & GuidelinesLate Enrollment PenaltyMedicare Part D is an entitlement but enrollment is voluntaryLow-income subsidy provides additional cost savingsWaiting to enroll until after May 15, 2006 may come at a penaltyNov 15, 2005May 15, 2006January 2007January 2008Sign up & pay = $34.78/Month**Sign up & pay = $32.20/Month*Sign up & pay = $38.95/Month***Amount based on $32.20 national average monthly beneficiary premium (CMS, August 2005).**Assumes national average premium does not increase annually
17 National Part D Enrollment not meeting HHS Projections 39.1 million beneficiaries would enroll in 2006 of which 10 million would have creditablecoverage under a qualified plan such as an employer or union sponsored plan.29.3 million would be enrolled in a Part D plan.Additional 11.4 million will need to sign up for a stand alone or MAPD plan in order to reach the29.3 million member target.*Projected Part D Enrollment = 29.3M30.0*Includes MAPD & Stand Alone PDP17.9 million20.015.8 million14.3 million11.6 million6.4 mil4.9 mil3.6 mil1 milEnrolled in Stand Alone PDPs10.04.7 mil5.1 mil4.4 mil4.5 milEnrolled in MA-PD6.2 mil6.4 mil6.2 mil6.2 milDual Eligible Auto Assigned from CMS0.0Dec 2005Jan 2006Feb 2006Mar 2006Actual Part D EnrollmentSource: Projected: HHS, Medicare Drug Benefit Final Rule 1/28/05. Actual: HHS 12/22/05, 1/17/06 , 2/22/06, & 3/23/06
18 Formulary Covered Drugs Statutory Exclusions Provider Challenges AntidepressantsAntipsychoticsAnticonvulsantsAntiretroviralsImmunosuppressantsAntineoplastics.Over the counter medicationsWeight gain and loss drugsFertility and cosmetic/hair growth drugsDrugs to relieve cold symptomsSome vitamins and mineralsBarbiturates, and benzodiazepinesPrescription Drug Plans Must:Assure a broad access to drugsRequire two drugs per Categories & ClassesMust comply with USP model guidelines
19 Formulary Provider Challenges Drug coverage can differ based on how the drug is prescribed dispensed or administered to the patientInhalation DME supply drugs – solution for inhalation via nebulizer onlyOral Anti-cancer agentsDiabetic test strips & lancetsInfluenza, pneumococcal, Hepatitis B vaccines
20 Exceptions & Appeals Process Provider ChallengesExceptions & Appeals ProcessPlans must have a drug transition process in place to assure a seamless transition for patientsA 90 day period may be needed for patients taking non formulary drugsFor rapid transitions, beneficiaries may need to use a plan’s exceptions & appeals processEstablish an adequate exceptions process to help LTC residents who need non formulary drugsProvide a one time temporary or emergency supply to ensure that there is no coverage gap during the exceptions process
21 Medication Therapy Management Provider ChallengesMedication Therapy ManagementMTM programs must be designed to assure that covered medications will be used appropriately by targeted beneficiaries. A plan’s MTM services must be developed in cooperation with licensed and practicing pharmacists and physicians.Optimize therapeutic outcomesImprove medication useReduce risk of adverse events & interactionsIncrease patient’s adherence & compliance with regimens
22 Key DateMay 15, 2006 – The last day that current Medicare eligible beneficiaries can join a drug plan without paying a penalty.
23 Message Points for Providers Patients will ask you for adviceOne plan does not fit all Medicare beneficiariesEvaluate Drug Benefit Cost SharingEncourage patients to look into low income subsidiesPremium Penalty for delay in signing upAdvise to compare formularies and pharmacy networksKnow where to tell patients to turn for more information
24 Where to Turn for More information: HighmarkMedicare1-800-MEDICARE&Social Security Administration