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November 2, 2010
On November 15, 2010, the open enrollment period for the Medicare Part D prescription drug benefit program will begin. This will allow beneficiaries to select a new Prescription Drug Plan (PDP) for the 2011 plan year. This open enrollment period runs through December 31, 2010.
The Centers for Medicare and Medicaid Services (CMS), the federal agency that administers Medicare have already begun mailing the 2011 Medicare Handbook, as well as numerous notices for beneficiaries for changes coming in 2011.
These notices are all available on the CMS Part D website, including a search engine to research available plans for 2011 and compare how specific medications are covered on each plan.
Web links of importance:
Changes for “Dual Eligibles” and Low-Income Subsidy (Extra Help) Recipients for 2011
Each year since 2007, as many as 1 million low-income Medicare beneficiaries that are either concurrently (dually) eligible for Medicaid, or are low-income, have been reassigned to different plans – or have been permitted to choose a different plan for the coming year. As many as 1/3 of dual eligibles in many states are beneficiaries living with people that live with serious mental illness. For 2011, fewer low-income beneficiaries will be forced through plan reassignment. While this is encouraging, the process of reassignment and ensuring continuity of care in the transition to uninterrupted coverage to new plans in January can be difficult.
Changes for “Dual Eligibles” and Low-Income Subsidy (LIS) Beneficiaries
Of particular concern to NAMI are those low-income Medicare beneficiaries living with serious mental illness who are concurrently (dually) eligible for Medicaid or are receiving “extra help” known as “Low-Income Subsidy.” These beneficiaries receive subsidies to afford drug coverage, limits on cost sharing and are NOT at risk of falling into the “doughnut hole” coverage gap.
As in previous years, these dual eligible and LIS beneficiaries in 2011 will be automatically assigned to drug plans (known as PDPs), assuming they do not choose a plan themselves. These PDPs offer the standard Part D benefit, referred to as low-income benchmark plans, for which the individual pays no premium.
Each year, all Part D plans submit bids to CMS that describe their benefits and their premium and cost-sharing structure. CMS determines benchmark plans - those plans for which Medicare will pay the full premium cost for beneficiaries receiving Extra Help - for any given region based on the bids of all plans in that region. A plan that was a benchmark plan one year may not be available as a benchmark plan the following year because its premium has risen above the benchmark, because it has changed its benefit structure to become an "enhanced" rather than a "standard" plan, or because it is terminating as a stand-alone PDP, or is part of a Medicare Advantage plan that has withdrawn from the market altogether.
Changes from the Affordable Care Act that Reduce Reassignments
Each year, CMS reassigns all those who are dual eligibles or receiving LIS that have not chosen their own plan and whose current plan will not qualify as a benchmark plan in the next year to new benchmark plans. For plan year 2010, such reassignments affected about a million beneficiaries. Two changes in the law have reduced the number of such reassignments for plan year 2011 to about 500,000.
First, the Affordable Care Act (the health care reform law) included a provision that changed the way the benchmark premium is calculated for Medicare Advantage plans. The law disregards rebates which, when considered, had allowed Medicare Advantage plans with prescription drug coverage to have artificially low Part D premiums, and thus to suppress the benchmark level. The method of calculation prior to this change resulted in the premiums of stand-alone Prescription Drug Plans - the only plans to which dual eligibles and LIS recipients are automatically assigned - often exceeding the benchmark.
A second helpful change in the Affordable Care Act directs CMS to allow Part D plans to voluntarily waive, for Extra Help recipients, any premium in excess of the benchmark premium, if such excess is "de minimis." Plans that voluntarily waive the excess premium under this policy are not eligible for auto-assignment of newly enrolled dual eligible and LIS recipients that have not chosen their own plan. CMS also will not randomly reassign beneficiaries to a de minimis plan, though CMS may reassign people to a de minimis plan if a PDP sponsoring organization offers a de minimis plan but not a benchmark PDP in a particular region.
Reassignments and Related Notices to Extra Help Recipients for Plan Year 2011
This week CMS will begin notifying beneficiaries that are being auto-reassigned to new PDPs with a two-page letter on blue paper and an attachment listing the zero premium plans in their region. The letter will have different content, depending on the reason the beneficiary is being reassigned. The following groups of beneficiaries will receive one version of this notice:
The notice sent to these individuals will identify three options:
The letter then refers the recipient to the list of zero premium plans attached to it.
The reassignments are conducted for individuals who meet the criteria on a single day in October when CMS makes the reassignments. CMS will not subsequently sweep enrollment lists for people who meet the criteria later.
Another blue letter from CMS will go to a different group of Extra Help recipients. This letter will also be sent in early November. It will go to:
The letter will inform individuals that their plans have withdrawn from Part D for 2011 and that they have two options:
Both groups receiving letters - whether for plan termination or loss of benchmark status – will receive additional blue letters from CMS in December in which CMS identifies which of the individual's drugs are covered under the plan to which she or he has been assigned. The requirement to send more detailed formulary information to subsidy-eligible individuals who are reassigned was added by the Affordable Care Act.
Obligations of Plans Receiving Dual Eligibles and LIS By Reassignment and Plan Termination
Part D plans that are taking dual eligibles and LIS upon reassignment will be required to meet a number of requirements with respect to drug coverage for these individuals. They must:
In addition, it is important to note that any dual eligible beneficiary that wishes to switch to a different Part D plan can do so, at no cost, at any time during 2011, so long as the plan is at or below the regional “benchmark” level.
Tips for Dual Eligible Beneficiaries Subject to Plan Reassignment
Any dual eligible or LIS recipient that received the blue reassignment letter from CMS needs to first read it carefully and contact their new prescription drug plan as soon as possible – every Part D plan is required to maintain an 800 customer assistance number. It is critical to:
It is also critical that all physicians prescribing to the dual eligible or LIS individual be notified before January 1, 2011 of the plan switch. Likewise, the pharmacy that fills prescriptions for the dual eligible should be notified to see if they are part of the new plan’s network.
Finally, it is STRONGLY recommended that refills of as many medications as possible be obtained in the final days and weeks of December 2010 to avoid problems at the pharmacy counter in the early days of January 2011 as enrollment in the new prescription drug plan in verified and new membership cards arrive in the mail.
Choosers (People That Have Selected Their Own Plan)
CMS refers dual eligibles and LIS recipients that choose their own plan initially or who change out of the plan into which they are initially auto-enrolled as "choosers." Generally speaking, CMS does not re-assign choosers when their benchmark plan loses its benchmark status. As noted above, it does re-assign those whose plan is terminating. Choosers receiving the full subsidy who are in a plan that is not benchmark (either because it lost its benchmark status in a previous year or because it never was a benchmark plan) received a tan letter from CMS in June, reminding them of the amount of premium they are currently paying and of their opportunity to join a benchmark plan in which they would pay no premium. The letter includes a list of benchmark plans in the recipient's region.
Redeterminations of Eligibility for Low-Income Subsidy (LIS) or “Extra Help”
The letters described above are sent only to those individuals who satisfy the criteria for re-assignment and who are either a dual eligible or eligible for LIS (Extra Help) for 2011. Some Extra Help recipients will be subject to redeterminations of their eligibility.
Individuals who qualify for LIS (Extra Help) because they receive SSI, Medicaid or a Medicare Savings Program benefit and who then lose their eligibility for the underlying program should have received a gray letter from CMS and the Social Security Administration in September explaining that they have lost Extra Help because of the loss of the other benefit and inviting them to apply directly for Extra Help. Or, if after the loss of the underlying benefit, they re-qualify for it, CMS will notify them that they qualify for LIS (Extra Help) again.
Alternatively, those who qualify for LIS (Extra Help) through a Social Security Administration (SSA) application, rather than through another program, may be subject to a redetermination of their eligibility. Those so affected should have already received a letter from SSA in September and should return it promptly to ensure continued eligibility if, in fact, they continue to meet the criteria.
Read all the letters from CMS.
October through December is a busy time for individuals with Medicare Part D and more so for those receiving Extra Help. Recipients should carefully read all letters received from their plans, from CMS and from SSA. Most importantly, recipients should:
Remember, every person who is reassigned has the right to change plans at any time.