Government News
Lawsuit Challenges Medicare Part D Transition Plan For Dual Eligibles
Psychiatric News
Volume 40 Number 24 page 1-26

Eight organizations have filed suit against the federal government for failing to ensure that more than 6 million individuals who are dually eligible for Medicare and Medicaid will receive their medications when the new Part D prescription drug plan begins on January 1.

At that time, prescription drug coverage under state Medicaid plans for patients who are also enrolled in Medicare will cease, and the new Medicare prescription drug plan will begin. But advocacy groups, including APA, have been bracing for enormous complications with transitioning these beneficiaries— some 2 million of whom are believed to have mental illness—into the new program.

The lawsuit, filed against Health and Human Services (HHS) Secretary Mike Leavitt, alleges that the federal government is failing to ensure that transfer, with potentially catastrophic results.

Leavitt "is not taking adequate steps to meet his obligations under the statute," the lawsuit alleges. "Unless he does so, countless dual eligibles will fall through the cracks of this massive program transition; they will not be effectively transferred to new Medicare prescription drug coverage and may be left without needed prescription drug coverage on and after January 1, 2006. Because many of these persons need prescription drug coverage to function or survive, the consequences of no longer receiving prescription drug coverage will be calamitous."

The organizations that have filed the suit are Action Alliance of Senior Citizens of Greater Philadelphia, Congress of California Seniors, Massachusetts Senior Action Council, National Alliance on Mental Illness: Maine, New York Statewide Senior Action Council, Coalition of Voluntary Mental Health Agencies Inc., United Senior Action of Indiana, and Medicare Rights Center.

The organizations are being represented by volunteer attorneys with the law firm Paul, Weiss, Rifkind, Wharton, and Garrison L.L.P., and the Medicare Rights Center.

"The poorest, sickest, and oldest Americans face grave risk of losing their life-saving medications once the clock strikes 12 on New Year's," said Robert M. Hayes, president of the Medicare Rights Center, a national consumer service group. "This lawsuit seeks to force creation of an essential safety net to protect the health and lives of the frailest Americans."

It also says that the characteristics of the people at risk—nearly 40 percent are cognitively impaired, and only 39 percent have a high school diploma—will prevent up to a million poor seniors from immediately mastering the complexity of the new Medicare drug benefit so they can maintain their access to needed medicine.

A spokesperson for the Centers for Medicare and Medicaid Services (CMS) would not comment on the lawsuit, but since its filing last month, the agency vowed to institute a "fail-safe" policy by which patients who show up at a pharmacy with identification proving their participation in Medicare and Medicaid will receive their medication, even if they are not enrolled in a prescription drug plan.

At press time, the CMS spokesperson said the details about how the fail-safe plan would work were unknown. But she emphasized that patients with proper identification would leave the pharmacy with a prescription, and the pharmacist would work with a CMS contractor to ensure the claim is filed for reimbursement.

"There is a point-of-sale mechanism that we hope will be in place to ensure that beneficiaries experience no coverage gaps," CMS spokeswoman Barabara Cebuhar told Psychiatric News. "If they come to the pharmacy with their proof of eligibility, they can have the claim submitted for payment even if they do not have current enrollment in a Medicare drug plan."

At press time, she said the agency had identified 6.1 million dual eligibles, some 5.5 million of whom have been randomly assigned to prescription drug plans in the fee-for-service Medicare plan. The remaining 600,000 will be receiving prescription drug coverage in managed care plans under the Medicare Advantage program, she said.

Irvin Muszynski, J.D., director of APA's Office of Healthcare Systems and Financing, welcomed the institution of a fail-safe mechanism as patients are transitioned into the Part D programs.

"We think the move toward a fail-safe mechanism is a positive development, and we look forward to learning more of the details," he said.

Muszynski also said that formularies for most prescription drug plans appear to include antidepressants, antipsychotics, and anticonvulsants, but the level of utilization management involved in these formularies remains to be determined.

"Unfortunately, we have to determine this on a case-by-case basis," he said.

The complaint, which was filed in federal district court in Manhattan, is posted at<www.medicarerights.org/complaint.pdf>. The Medicare Rights Center's report, "Protecting the Poorest Americans During the Medicare Drug Transition" is posted at<www.medicarerights.org/drugtransitionreport.pdf> .

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