The Social Security Administration (SSA) sent out 18.6 million applications for extra help paying for the Medicare prescription drug benefit from May to August, but only three million applications have been returned.

            The Centers for Medicare and Medicaid Services (CMS) Administrator Mark McClellan said that CMS actuaries project that 4.6 million people will enroll in the extra help by 2006. Government officials estimate that about 15 million people qualify for the program, half of whom will be automatically enrolled through Medicaid or another government assistance program.

            Social Security Commissioner Jo Anne Barnhart said that SSA’s work is “far from over.” SSA is now making follow-up contacts with those who submitted incomplete applications and those who did not submit an application.

The transition from Medicaid prescription drug coverage to the new Medicare prescription drug coverage is considered the most significant change to Medicaid policy in past 30 years.  In this transition, families of dual-eligibles with disabilities, caregivers, advocates and providers will be required to educate themselves on the new Medicare coverage (known as Medicare Part D) to ensure that dual-eligibles continue to have affordable access to the prescription drugs they need. 

On December 31, 2005, Medicaid prescription drug coverage for 6.4 million dual-eligibles (those who receive both Medicare and Medicaid) will end and be replaced on January 1, 2006 by the new Medicare Part D coverage, which will be provided by private prescription drug plans (called PDPs). It is estimated that 50 percent of individuals with developmental disabilities, who receive state MR/DD services, are dual-eligibles and will be affected by this transition.  A substantial portion of this population has significant disabilities and complex health needs requiring several prescription medications.   

The Arc and United Cerebral Palsy are preparing extensive public education documents, including comprehensive “Questions and Answers” for families, providers, caregivers, advocates and individuals with disabilities.  Materials, including PowerPoint presentations, and links to important resources will be posted on both organizations Web sites in September.  This information will be updated in October when the Centers for Medicare and Medicaid Services (CMS) releases information on the private plans that will be offering Part D coverage.  The new Medicare Prescription Drug and Modernization Act (known as the MMA) allows prescription drug plans to begin marketing to Medicare beneficiaries on October 1. 

The Arc and United Cerebral Palsy strongly advise all dual-eligibles, their families, caregivers and providers to read the CMS material, when it becomes available (via the mail in late October/early November), and the information on The Arc’s and UCP’s Web sites before responding to any marketing information from the private plans.

There are several key differences between Medicaid prescription drug coverage and the new Medicare Prescription Drug Plans (PDPs). For example:

• The private Prescription Drug Plans may have limited formularies or they may place other restrictions on access to the medications a beneficiary needs.
• Cost-sharing likely will be higher (except for individuals who live in intermediate care facilities for people with mental retardation (ICF/MRs) or related conditions).
• Unlike Medicaid, there is no requirement to dispense an emergency supply of medications pending an appeal in a case where a plan seeks to deny coverage for a specific drug (except for individuals who live in an ICF/MR).
• Unlike Medicaid, pharmacists are permitted to deny medications if beneficiaries are unable to pay the co-pays.

Current Medicaid rules limit these potentially harmful actions that can disrupt treatments and put the health of dual-eligibles at risk, but the Medicaid rules will not apply to dual-eligibles when they transition to Medicare prescription drug coverage.

It is estimated that there will be several (perhaps as many as 20 in some regions) authorized Medicare prescription drug plans in each region of the country. In evaluating which plan meets the needs of dual-eligibles with developmental disabilities, individuals, providers, families and caregivers will be required to consider several factors including:

• Individuals or their caregivers will need to evaluate the drug formularies (a list of prescription medications that a drug plan will pay for) of the various plans to see if they include all the drugs they need, and to see if there are any restrictions on access to those drugs.
• If the plans do not cover all their prescription drugs, a medical consultation may be necessary to see if their doctor will work with the person to appeal the decision or if the individual can safely be switched to other medications.
• They will need to look at the pharmacy network to make sure the pharmacy they use is part of the PDP’s network.
• Individuals or their caregivers need to be aware that Medicare will reimburse only for premiums that are at or below a certain cost level so choosing another plan may result in higher costs to the individual.

Under Medicare Part D, different rules apply for individuals who reside in nursing facilities or ICF/MRs versus other group homes, at home or in supported living arrangements.  A dual-eligible residing in an ICF/MR or nursing facility will not be required to pay co-pays.  If the dual-eligible’s income is under 100 percent of the federal poverty level ($9,570 annually for an individual), he or she must pay $1 for preferred (usually generic) medications or $3 for non-preferred (usually brand name) medications as described by the PDP.  If the individual’s annual income is above 100 percent of the federal poverty level ($9,570 annually), then the co-pay is $2 for the preferred medication and $5 for the non-preferred.