Medicare Compliance & Reimbursement

Success of new Medicare may depend on communication with beneficiaries.

Offering Medicare beneficiaries reliable, comprehensible information to aid their choices in drug coverage will be a daunting task, but it's crucial to success of the Medicare prescription-drug legislation. That was the opinion voiced by John Rother, top lobbyist for the big senior lobby AARP, and Urban Institute President Robert Reischauer at AcademyHealth's health-policy conference Jan. 28.

The legislation "is important" and will "help a lot of people," said Reischauer. Nevertheless, beneficiaries won't realize benefits unless they make the right choices about whether and when to sign up for coverage, what plan to sign up for, and whether to seek additional coverage, such as through a state pharmacy assistance program or drug-company-sponsored initiative. That being the case, "the issue that should concern all of us here today" is "who will provide information to beneficiaries on all of these choices?" Reischauer said.

An early key challenge, will be to convince beneficiaries that it's worth buying coverage right away, said Reischauer. The assistance will definitely be of use over the course of most beneficiaries' lifetimes, but many may not recognize that fact as they tot up their likely expenditures for the initial year. If people decline coverage based on a one-year analysis, they'll end up paying higher premiums for later enrollment as well as rob the coverage pool of healthier members to help spread costs, he suggested.

Today, "the jury is very much still out" about whether beneficiaries will warm up to the new law, said Rother. "There are many many uncertainties in the way this will play out." But "from a beneficiary point of view, I think complexity is the major issue."

For example, every state that now offers drug assistance to seniors will have to redesign its program to harmonize with the federal benefit, said Rother. AARP will work on this information issue in all the states, but in general the organization isn't set up to offer detailed state-specific education. AARP will be looking for partners to help in this effort, he said.

Furthermore, "information" for the drug law can't mean just pamphlets and Web sites. "Our 82- and 84-year-old fathers and mothers are really going to need somebody to talk to."

The $1 billion currently allotted for the Centers for Medicare & Medicaid Services to administer the program, including educating beneficiaries about it, "is inadequate," Rother said.

Besides asking for more beneficiary education, AARP will push for enhanced drug cost-containment, including fallback authority for the Department of Health and Human Services to negotiate prices with manufacturers; closure of the so-called doughnut hole coverage gap; elimination of the asset test; better coordination of the federal benefit with state programs; and copays indexed to [...]