State Responses to Medicare Part D
Presented by: Kimberley Fox, Senior Policy Analyst, Institute for Health Policy Academy Health Annual Research Meeting Seattle, WA June 2006
Survey Methods
Funded by the National Pharmaceutical Council Literature and document review Fall 2005 survey w/ telephone follow-up
Snapshot of states’ plans for adapting programs to MMA 24 existing SPAP programs 14 Medicaid agencies (representing 66% of Medicaid drug spend), 11 in states with SPAPs. Response rate: @96% Findings reflect responses at time of survey completion.
6/27/06
Muskie School of Public Service
State Responsibilities/Options Under Part D
Medicaid
Assist w/ transitioning duals Clawback payments LIS application and MSP screening responsibilities. May fill Part D gaps with state-only dollars
State Pharmacy Assistance Programs (SPAP)
May fill Part D gaps Qualified SPAP expenditures count toward TROOP Part D plans must coordinate Transitional grant funding available
6/27/06
Muskie School of Public Service
Key Differences between Part D and State Pharmacy Coverage
Medicaid
May face higher copayments Loss of guaranteed access if they can’t afford copayments No coverage of excluded drugs under Part D Formularies may not include drugs covered under Medicaid Loss of coverage of denied drugs during appeal More limited pharmacy networks.
State Pharmacy Assistance Programs (SPAPs)
Tighter formularies/ more limited pharmacy networks LIS eligible – potentially lower cost-sharing Non-LIS eligible –
Up-front costs such as premiums and deductibles previously not required in many programs Higher cost-sharing before and in the donut hole (varies by state).
6/27/06
Muskie School of Public Service
Part D Transitional Enrollment Issues for SPAP Enrollees and Duals
Duals
Medicaid drug coverage ends Jan 2006 All duals ‘deemed eligible’ for low income subsidies Randomly assigned to below benchmark PDPs by CMS – Nov 2005 State Medicaid agencies can conduct formulary matches to recommend more appropriate plans.
SPAP Enrollees
Most not deemed eligible for LIS, must apply (exc. MSPs) All enrollees must voluntarily enroll in PDP/MA-PD Qualified SPAPs cannot auto-enroll enrollees into a preferred plan Various options to ‘facilitate’ LIS application/Part D enrollment
6/27/06
Muskie School of Public Service
SPAP and Medicaid Part D Gap-filling Options
Medicaid
Premium assistance above LIS benchmark Copayments Off-formulary/PDP denied drugs or during appeals Non-Part D covered drugs (eligible for FFP)
Premium assistance (LIS or full premium) Wrap around full/partial LIS or non-LIS out-of-pocket costs Deductibles, copayments, donut hole, Off-formulary/PDP denied drugs or out-of-network pharmacies Non-Part D covered drugs
SPAP
6/27/06
Muskie School of Public Service
Filling Part D Gaps for Duals: Selected Medicaid Plans 2006
N=14
NY
Premiums Above LIS Part D Copays Drugs Denied by PDP
NY NJ NJ
NY,NJ NY,NJ
NJ NJ
Source:
Drugs during appeal
Part D Excluded Drugs 0 2 4 6 8 10 12 14
# of States Source: Part D Survey of Medicaid and SPAP Directors, Fall 2005 Source: Part D Survey of SPAP and Medicaid Directors, Fall 2005.
6/27/06
Muskie School of Public Service
Medicaid Transition Plans for Part D Enrollment, 2005
Educating Providers
13
Collaborating w / Related Agencies Info to Duals on Formulary Match
13
5
3 Mo. Supply in Dec
3
Screening Applications sent to SSA for MSP
4
0
2
4
6
8
10
12
14
# of States
Source: Part DD Surveyof Medicaid and SPAPDirectors, Fall 2005. Source: Part Survey of SPAP and Medicaid Directors, Fall 2005
6/27/06
Muskie School of Public Service
SPAP Plans Once Part D Begins, 2006
N=24
Maintaining Some Coverage Program Closing Closing to Medicare Eligibles* Maintaining Medicaid waiver
5 17
1
1
0
5
10
# of States
15
20
Source: Part D survey of SPAP and Medicaid Directors, Fall 2005. *Maryland is also closing its waiver program to Medicare eligible but will continue a second state-only program to provide wrap assistance for non-LIS eligible persons.
6/27/06
Muskie School of Public Service
Specific Part D Gaps Filled by SPAPs, 2006
N=17
Premium Late Penalty Deductible Copayment Donut Hole Formulary Appeal for Bene Non-Part D Covered Out of Netw ork 0
12 4 13 11 14 5 4 10 3
5 10 # of States 15
Source: Part D Survey of Medicaid and SPAP Directors, Fall 2005
Source: Part D Survey of SPAP and Medicaid Directors, Fall 2005.
6/27/06
Muskie School of Public Service
More than Half of SPAP Enrollees Will Not Qualify for Full LIS*
N=26 programs/23 states
<135% FPL 135-150% FPL
43% 44%
>150%FPL
*Percentages based on estimates by state officials from income data, generally do not include assets.
1 3%
Source: Part D Survey of SPAP and Medicaid Directors, Fall 2005.
6/27/06
Muskie School of Public Service
SPAP Efforts to Enroll Members in LIS, 2005 N=17
Mandating LIS
14
LIS Authorized Rep
9
Help w / Completing LIS application Plans to Collect Assets/submit applications for enrollees State w ill Appeal LIS
12
5
4
0
5
10
15
# of States *For LIS and/or Part D Enrollment Source: Part D Survey of Medicaid and SPAPDirectors, Fall 2005. Source: Part D Survey of SPAP and Medicaid Directors, Fall 2005
6/27/06
Muskie School of Public Service
SPAP Efforts to Enroll Members in Part D Plans, 2005 N=17
Mandate Part D
14
Authorized Rep for Part D enrollment
11
Co-branding
6
Random Assignment
5
Intelligent Random Assignment 0 *For LIS and/or Part D Enrollment 5
5
10 15
# of States Source: Part D Survey of SPAP and Medicaid Directors, Fall 2005. Source: Part D Survey of Medicaid and SPAP Directors, Fall 2005
6/27/06
Muskie School of Public Service
Few States Expanding SPAPs to New Groups
N=17 states
15
# of States
10
5
0
Excluding LIS eligible
Expanding Income Eligibility
Expanding to Disabled
Including Duals
Source: Fox and Schofield, Medicaid and SPAP Part D Survey, Fall 2005
Source: Part D Survey of SPAP and Medicaid Directors, Fall 2005.
6/27/06
Muskie School of Public Service
Summary of State Actions
Short-term emergency coverage (Medicaid/ some SPAPs) Medicaid largely not filling Part D gaps for duals over time, except Part D excluded drugs. SPAPs holding existing enrollees harmless, but not expanding benefits/eligibility Only a few states starting new SPAPs States generally exercising caution… wait and see approach.
6/27/06
Muskie School of Public Service
Policy Implications/ Discussion
Differences in State D-Gap plans for duals and SPAP enrollees
Larger cost-sharing differences for non-LIS SPAP enrollees relative to prior coverage than for duals. Large potential savings to SPAP as secondary payer; little savings and potential shortterm losses from the clawback for Medicaid.
Formularies – to wrap or not to wrap.
Don’t want to encourage Part D plans to limit formularies to narrowest possible standard Adverse effects from reduced drug coverage as a result of restricted formularies may result in more cost to the state if that leads to use of more expensive medical services. States may want to reserve the right to cover in limited circumstances where likelihood of adverse events is higher. At minimum, could help duals appeal. Reconsideration of federal match (?)
SPAPs Can Do More to Maximize SPAP Savings allowing them to potentially fill more gaps or expand eligibility.
Monitor state coverage decisions on duals and SPAP enrollees.
6/27/06
Muskie School of Public Service
Further Information
For copies of this presentation:
kfox@usm.maine.edu
Full report of survey findings available at:
http://muskie.usm.maine.edu/m_view_publication.js p?id=3409
6/27/06
Muskie School of Public Service