Implications of Medicare Prescription Drug Benefit for QIOs

1
Implications of Medicare Prescription Drug
Benefit for QIOs

• A Government Affairs Staff Update Prepared for
  the Medical Affairs Section
• David Schulke and Todd Ketch
• AHQA Medical Affairs Section Meeting
• March 9, 2004
• New Orleans

2
Sources of Drug Coverage for Medicare
Beneficiaries, 1999
SOURCE Congressional Budget Office, based on
Medicare Current Beneficiary Survey
3
Value of the Medicare Drug Benefit
4
Distribution of Drug Spending in 2006 (Percentage
of beneficiaries with spending in the dollar
range)
SOURCE Congressional Budget Office, based on
Medicare Current Beneficiary Survey
5
Rx Discount Card
 

• 10-15 off the cost of Rx
• Available to all beneficiaries- 30 enrollment
  fee.
• Additional 600 subsidy for low-income
  beneficiaries no enrollment fee.
• Rx card marketing begins in April 2004
• Sign up in May 2004. Discounts begin June 2004.
• Program ends when full Rx benefit is available in
  2006.

6
Rx Basic Benefit Structure

• Begins in 2006 Open Enrollment in November 2005
• Estimated 35 monthly premium
• 250 Deductible
• 25 Co-pay on Rx costs between 250 and 2,250
• No coverage between 2,251 and 3,600
• 5 Co-pay on all Rx costs above 3,600
  out-of-pocket (5,100 in total drug spending)
• Additional assistance for incomes below 150 Fed.
  Poverty Level (13,000 single, 18,000 couple),
  with assets test.
• Caveat Plans can offer any benefit that is
  actuarially equivalent to this benefit (e.g.,
  low/no premium with a preferred drug list and no
  gap in coverage)
• Federal Fallback If at least two plans arent
  available in a given area, the federal government
  will arrange for a stand-alone drug plan to be
  provided.

7
Rx Coverage Appeals

• Appeals process for Rx required to be similar to
  appeals process for Medicare Advantage plans
  under Part C.
• Beneficiaries can appeal the formulary
• if the prescribing physician determines that all
  covered part D drugs on any tier of the formulary
  for treatment of same condition would not be as
  effective for the individual as the non-formulary
  drug, would have adverse effects for the
  individual, or both.
• Beneficiaries can appeal the tiered cost-sharing
  structure
• to have a non-preferred drug covered under the
  lower cost preferred drug tier if the prescribing
  physician determines that the preferred drug
  would not be as effective for the individual as
  the non-preferred drug, would have adverse
  effects for the individual, or both.

8
Care Management Technology

• Medication Therapy Management
• Plans must have programs to provide medication
  therapy management by pharmacy providers targeted
  to beneficiaries who (1) have multiple chronic
  conditions, (2) use multiple prescriptions and
  (3) are likely to incur high drug expenses.

9
Care Management Technology

• Electronic Prescribing
• Plans may operate electronic prescription
  programs that meet federal standards.
• The Secretary, in consultation with appropriate
  stake holders, would develop and adopt initial
  standards by September 1, 2005 and issue final
  standards by April 1, 2008.
• Discretionary grants may be available to assist
  providers in implementing electronic prescription
  programs.
• Prescription drug plans may pay an additional fee
  to doctors who reduce medical errors, improve
  formulary compliance or reduce adverse drug
  interactions.

10
SEC. 109. EXPANDING THE WORK OF MEDICARE QUALITY
IMPROVEMENT ORGANIZATIONS TO INCLUDE PARTS C D

• (a) APPLICATION TO MEDICARE MANAGED CARE AND
  PRESCRIPTION DRUG COVERAGE- Section 1154(a)(1)
  (42 U.S.C. 1320c-3(a)(1)) is amended by inserting
  , to Medicare Advantage organizations pursuant
  to contracts under part C, and to prescription
  drug sponsors pursuant to contracts under part D'
  after under section 1876'.
• (b) PRESCRIPTION DRUG THERAPY QUALITY
  IMPROVEMENT- Section 1154(a) (42 U.S.C.
  1320c-3(a)) is amended by adding at the end the
  following new paragraph
• (17) The organization shall execute its
  responsibilities under subparagraphs (A) and (B)
  of paragraph (1) by offering to providers,
  practitioners, Medicare Advantage organizations
  offering Medicare Advantage plans under part C,
  and prescription drug sponsors offering
  prescription drug plans under part D quality
  improvement assistance pertaining to prescription
  drug therapy. For purposes of this part and title
  XVIII, the functions described in this paragraph
  shall be treated as a review function.'.
• (c) EFFECTIVE DATE- The amendments made by this
  section shall apply on and after January 1, 2004.

11
QIO Role in the Medicare Prescription Drug Benefit

• Potential role of QIOs (examples)
• Use drug claims to identify chronically ill
  patients (e.g., patients treated for diabetes)
• Follow CHF and AMI and surgical patients
  post-discharge to see if they get appropriate
  medications
• Identify patients at risk of medication related
  problems (e.g., IMPROVE study algorithm) and
  recommend changes