Elder
Law FAX -- December 19, 2005
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Education |
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Preliminary Conclusions about Medicare's Implementation
of the New Prescription Drug Benefit (Medicare reform, contd.)
First, there was no outpatient prescription drug benefit. Then, in 1988,
Congress passed the Medicare Catastrophic Coverage Act to provide some
coverage. That law was so unpopular among seniors that it was repealed
the following year.
Fast forward a dozen years. Medicare introduced its own Medicare Rx drug card program. There was a problem with that, however. It may not have been legal for the federal government's Medicare agency to expand the Medicare benefit without Congressional approval.
Finally, in 2003, after years of agitating for a prescription drug benefit, Congress and the President finally delivered, a little more than two years ago, the "Medicare Prescription Drug Discount Card."
As a tool for transitioning to the "real" prescription drug benefit, set to begin next month, the Medicare drug discount card at least offered some beneficiaries some benefit. According to two reports recently issued by the federal government's investigative agency, however, there were flaws in the implementation of the Medicare drug discount card.
The Centers for Medicare & Medicaid Services (CMS) -- the agency within the Department of Health and Human Services that administers the Medicare and Medicaid programs -- administers and oversees the drug card program. The drug cards themselves are offered and managed by private organizations, known as drug card sponsors.
According to an October 28 report by the Government Accountability Office, the processes CMS used to solicit, evaluate, and approve general drug card applications were geared to the 6-month time frame between the enactment on December 8, 2003, of the Medicare Modernization Act and June 1, 2004, the mandated start date for the drug card program. This included the type of solicitation CMS used, the design of the application, and the application evaluation and approval process.
CMS used a noncompetitive solicitation process in which all qualified organizations could participate in the program. CMS developed the application for drug card sponsors before all of the program's operational guidelines had been completed. As a result, CMS officials said that open-ended questions were used to learn more about and evaluate potential sponsors' capabilities and for other reasons.
Moreover, CMS did not finalize guidance to drug card sponsors for how drug price data would be reported to the agency until five months after the program began. GAO also found missing and inaccurate price data, and inconsistencies between data provided to CMS and the drug price data posted on the CMS Web site for use by Medicare beneficiaries.
The report said that CMS has corrected some of the problems, but it has "some limitations with respect to the timeliness of oversight activities and the guidance provided to sponsors."
Another GAO report, issued on November 18, said that CMS was able to raise awareness for the drug card program but was not able to adequately inform and assist beneficiaries with its education and outreach efforts. These efforts did not provide information that was "clear, accurate and accessible," the report found.
In its comments back to GAO, CMS noted that the agency has "learned many valuable lessons" as a result of its experience with the drug card program, and that those lessons will inform its future efforts as it moves forward with the implementation of the Medicare prescription drug benefit that is to become effective in 2006.
In other words, said both GAO and CMS, the Medicare agency operated the Medicare drug discount card program on a "learn as we go" basis.
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