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Volume 12 Number 89 News: Part D Drug Benefit Some auto-enrolled dual eligible beneficiaries may not be taking full advantage of retroactive drug coverage benefits for which Medicare has reimbursed Part D plans millions of dollars, the Government Accountability Office reported May 8. For beneficiaries who become Medicaid-eligible while already enrolled in the Medicare, drug coverage can be extended retroactively to months before beneficiaries become aware of their enrollment in a Part D plan, GAO's Health Care Director Kathleen M. King told the Senate Finance Committee. Plans are required to notify beneficiaries of their right to seek reimbursement for medications that otherwise would have been covered by Part D during the period of retroactive coverage. However, GAO found that often beneficiaries were not made aware of the ability to seek such reimbursements. Furthermore, King said that CMS did not begin informing beneficiaries of their right to seek reimbursement until March 2007. GAO's Findings GAO's findings were also included in a report released May 8, Medicare Part D: Challenges in Enrolling New Dual-Eligible Beneficiaries (GAO-07-272). While CMS paid plans for retroactive coverage, it did not monitor whether plans made any reimbursements to beneficiaries for drugs that would have been covered, but for which they paid out of pocket, GAO found. "GAO estimated that in 2006, Medicare paid PDPs millions of dollars for coverage during periods for which dual-eligible beneficiaries may not have sought reimbursement for their drug costs," the report stated. GAO recommended that CMS modify beneficiary notices and that CMS monitor whether plans reimbursed beneficiaries according to policy. King noted that CMS had begun addressing the situation. CMS's Center for Beneficiary Choice Director Abby L. Block confirmed that the agency was aware of the problem, but also said that CMS would not rethink its policy of retroactively providing coverage because that would mean an unacceptable gap in benefits for some beneficiaries. GAO found that for beneficiaries who already are in the Medicaid program when they become eligible for Medicare benefits have experienced fewer problems, because CMS prospectively assigned Part D enrollment to coincide with Medicare eligibility, meaning there is a seamless transition from Medicaid coverage to Part D. Tax Data Access In separate analysis of the Part D program and low-income beneficiaries, GAO has found that more needs to be known about the effectiveness of tax data in helping the Social Security Administration to focus its outreach efforts on low-income individuals who have not yet enrolled in the Part D program. GAO's Education, Workforce, and Income Security Issues Director Barbara Bovbjerg said that, although the Internal Revenue Service has told SSA it believes such data would be of little value, no reliable data exist to confirm or deny that view. IRS is barred from accessing such data, and some lawmakers are seeking a statutory change that would allow the agency to use certain tax records to identify potentially eligible beneficiaries for the low-income subsidy. Bovbjerg noted in her testimony before the panel that the SSA approved about 2.2 million Medicare beneficiaries for the low-income subsidy, as of March 2007, despite "barriers that limited its ability to identify individuals who were eligible for the subsidy and solicit applications from them." Nevertheless, it is uncertain how successful SSA's efforts were, because no reliable data exists as to the size of the eligible population, Bovbjerg added. In a forthcoming report, expected by the end of May, GAO will recommend that SSA and IRS work together to determine to what extent tax data would be useful in identifying low-income individuals who would qualify for the LIS, Bovbjerg said. Marketing Concerns Responding to questions from lawmakers about marketing problems with all Medicare managed care plans, but particularly private fee-for-service plans, Block said CMS had resolved most compliance issues through warning letters, although some plans were asked to under take corrective action plans. Senate Finance Committee Chairman Max Baucus (D-Mont.) suggested that Congress consider giving states the ability to oversee plans. A provision in the Medicare drug law gives CMS such authority. Block noted CMS is working with states to ensure rogue sales agents are sanctioned and that plans end their contracts with sellers who engage in deceptive or fraudulent practices. Nevertheless, Baucus said he did not sense CMS was doing enough to scrutinize plans and at one point in the hearing called the agency "passive" in its oversight authority in the Part D program. Block also reiterated guidance in the 2008 call letter to Part D and Medicare Advantage organizations that would require PFFS plans to verify beneficiary intentions before finalizing enrollments. That measure will be effective for all plans beginning in 2008, Block said, but noted that one correction plan already is engaging in the verification process and has found that as many as 50 percent of applications are not eligible for finalizing because beneficiaries did not understand the product or did not intend to enroll in the benefit. The GAO report is available, and additional information about the hearing is available.
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