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Published:June 15th, 2006 02:45 EST

Over 38 Million People With Medicare Now Receiving Prescription Drug Coverage

By SOP newswire

HHS Secretary Mike Leavitt today announced that 38.2 million people with Medicare are now receiving comprehensive prescription drug coverage, in many cases even better coverage than they ever had before. A surge in enrollment took place in the closing weeks of the enrollment period, with more than 2 million beneficiaries signing up between May 1 and the May 15th deadline.

“Introduction of the Medicare prescription drug benefit created an unprecedented opportunity and a breathtaking challenge,” Secretary Leavitt said. “The challenge has been met, and today, for over 38 million Americans -- 90 percent of people with Medicare -- the promise is being fulfilled, day in and day out, prescription by prescription. In fact, more than 3.5 million Part D prescriptions are being filled each day and the cost of monthly plan premiums is nearly 40 percent lower than original estimates.”

The average premium in 2006 for beneficiaries, not counting retiree coverage, is less than $24. In addition, 87 percent of beneficiaries chose plans other than the standard benefit, according to the Centers for Medicare & Medicaid Services (CMS).

“With help from thousands of partners across the country, and personalized assistance from 1-800-MEDICARE and, people with Medicare and their family members were able to get the drug coverage they prefer at a far lower cost than expected,” said CMS Administrator Mark B. McClellan, M.D., Ph.D. “Thanks to Medicare beneficiaries making informed choices to meet their needs, the costs of Medicare drug coverage are way down -- and we will continue to support effective competition to provide high-quality, low-cost coverage.”

Total enrollment in Medicare Advantage plans increased by over 26 percent (1,249,041 self enrollees) during the six month enrollment period, bringing the total number of beneficiaries enrolled in Medicare Advantage plans to 7.4 million. Included in that total are about 4.8 million who chose to enroll in these plans before January, 2006.

About 87 percent of all beneficiaries who enrolled in a prescription drug plan chose a plan that offers coverage other than the standard benefit, such as no deductibles or coverage in the “donut hole.” Most beneficiaries enrolled in Medicare Advantage plans are also getting more comprehensive drug coverage than in the standard plan. In addition, almost 10 million low-income beneficiaries are getting comprehensive drug coverage for little or no cost.

Among the 38.2 million beneficiaries who are now receiving prescription drug coverage, approximately 32.8 million have coverage from Medicare and 5.4 million have coverage from other sources, including the Department of Veterans Affairs (VA), primary coverage from an employer (from beneficiaries who are working after age 65), and state prescription drug programs that are not yet combined with Medicare Part D. Based on the latest information on the choices of veterans with VA benefits and Medicare coverage, almost 40 percent are enrolled in Medicare Part D, a much larger number of VA beneficiaries than previously expected.

Enrollment for the new Medicare prescription drug coverage began on November 15, 2005 and ended on May 15, 2006.

Overall prescription drug coverage enrollment figures as of June 11 are:

  • Stand-Alone Prescription Drug Plans (PDPs): 10.4 million people with Medicare have enrolled in stand-alone prescription drug plans, including 2.2 million enrollees receiving the low income subsidy (LIS).
  • Medicare Advantage with Prescription Drugs (MA-PDs): 6 million beneficiaries receive coverage through Medicare Advantage plans with drug coverage (MA-PDs), including 1.2 million new enrollees. Medicare Advantage includes 925,000 enrollees receiving the LIS. About 478,000 of these are full Medicare/Medicaid beneficiaries. About 1.1 million beneficiaries are currently enrolled in MA-only plans; many of these beneficiaries in private fee-for-service plans are receiving Part D through a separate PDP and therefore included in the enrollment totals for PDPs.
  • Medicare/Medicaid: 6.1 million Medicare/Medicaid beneficiaries were automatically enrolled in prescription drug plans. An additional 478,000 Medicare/Medicaid beneficiaries enrolled in Medicare Advantage plans with prescription drug coverage and are counted in the MA-PD total above.
  • Retiree Coverage: 6.9 million retirees are enrolled in the Medicare retiree subsidy. In addition, about 1.5 million retirees are in employer and union-sponsored coverage that incorporates Medicare group drug coverage and about 400,000 retirees are in employer and union-sponsored coverage that wraps around Medicare drug coverage -- these beneficiaries are counted in the PDP and MA-PD totals above.
  • Federal retiree coverage: 3.5 million
    • TRICARE: Estimated 1.9 million beneficiaries with TRICARE retiree coverage, based on data that was provided by the Department of Defense (DoD). This number excludes nearly 7 percent who were found to be enrolled in Part D plans based on a person-level data match.
    • FEHB: Estimated 1.6 million beneficiaries with FEHB retiree coverage, includes both retirees and spouses, and excludes 2 percent who might be enrolled in Part D plans (based on information from OPM).
  • Additional Sources of Prescription Drug Coverage for Medicare Beneficiaries: HHS estimates that approximately 5.4 million Medicare beneficiaries have alternative sources of “creditable” prescription drug coverage:
    • VA: There are an estimated 2 million beneficiaries with creditable drug coverage through the VA who have not signed up for Part D. About 1 million VA beneficiaries enrolled in a Part D plan, and about 400,000 are receiving drug coverage from an employer receiving the Part D subsidy. These numbers are based on a sample person-level match provided by the VA.
    • Indian Health Service (IHS): There remains 0.1 million beneficiaries with creditable drug coverage through the IHS being served by I/T/U pharmacies in 28 states.
    • Active Workers with Medicare Secondary Payer: Nearly 2.6 million beneficiaries receive creditable drug coverage through an employer group health plan based on a person level match of our coordination of benefits files and Part D enrollment files.
    • Other Retiree Coverage: An estimated 0.1 million retirees are continuing in retiree coverage who are not already included in the other retiree coverage categories. Some of these retiree plans may apply for the Medicare retiree subsidy in their next full plan year, while others may have only a limited number of eligible retirees so that the financial impact of the RDS is small.
    • State Pharmaceutical Assistance Programs (SPAP): An estimated 0.59 million beneficiaries are continuing to receive creditable coverage through SPAPs. The estimate is based on information from four SPAP programs that have creditable coverage and are currently not requiring enrollment in Part D plans in order to retain SPAP coverage (NJ, NY, PA, and WI), and a person level match of SPAP files with Part D enrollment files.

Of the approximately 4.4 million Medicare beneficiaries who do not have secure, quality drug coverage, approximately 3.2 million are estimated to be eligible for the extra help. As President Bush announced, enrollment for these beneficiaries with limited incomes will continue throughout the year, with no late enrollment penalty.

HHS and CMS are continuing to work closely with the thousands of local organizations, whose efforts helped to inform and enroll the millions of Medicare beneficiaries across the country who enrolled in a prescription drug plan before the deadline, to reach these remaining beneficiaries. New outreach efforts include:

  • Collaboration with several intergovernmental partners including SSA; HUD; USDA; AoA; HRSA; and ACF to raise awareness and coordinate outreach events.
  • Enhanced outreach with many external partner organizations. For example, CMS is collaborating with minority groups including the NAACP to target federal outreach grants to the areas with greatest number of LIS eligibles.
  • New targeted outreach activities, including collaborations with NCOA to inform partners of best practices regarding data driven outreach methods.

“People with Medicare are already seeing significant savings through the new drug coverage, and beneficiaries with limited incomes have even more to save,” said Dr. McClellan. “It’s imperative that we reach as many of them to make sure that they are able to get the drugs they need.”

Source: HHS