The New York Times
States Intervene After Drug Plan Hits Early Snags
By ROBERT PEAR
WASHINGTON, Jan. 7 - Low-income Medicare beneficiaries around the country were often overcharged, and some were turned away from pharmacies without getting their medications, in the first week of Medicare's new drug benefit. The problems have prompted emergency action by some states to protect their citizens.
Although there are no hard numbers, concerns expressed by state officials and complaints from pharmacists suggest a widespread pattern of problems.
At least four states - Maine, New Hampshire, North Dakota and Vermont - acted this week to make sure poor people received the drugs they were promised but could not obtain through the federal Medicare program.
Gov. Jim Douglas of Vermont, a Republican, said the state would pay drug claims for low-income people until the federal government fixed problems in the new program, known as Part D of Medicare. Michael K. Smith, the state's secretary of human services, said, "The federal system simply is not working."
On Thursday, the Vermont Legislature passed a bill declaring, "There is a public health emergency due to the federal implementation of Medicare Part D, which has resulted in serious operational problems, causing Vermonters to be turned away at the pharmacy without the drugs they need."
Many factors contributed to the initial chaos. Some people who enrolled in Medicare drug plans did not have any proof of coverage. Pharmacists could not get the information needed to verify eligibility for drug benefits and low-income subsidies. Insurance companies and their pharmacy benefit managers were swamped with calls, so pharmacists often had to wait an hour or more on telephone help lines.
Federal officials promised improvements, but state officials were growing impatient.
In Maine, Gov. John Baldacci, a Democrat, agreed to pay drug claims to provide medications for those in need. Since Tuesday, the state has incurred $2 million of expenses for Medicare beneficiaries.
On Friday, Gov. John Hoeven of North Dakota, a Republican, said he had to act because "some low-income elderly and disabled individuals can't get their prescriptions filled through their Medicare drug plans."
In New Hampshire, Gov. John Lynch, a Democrat, signed an executive order authorizing the state to pay drug claims that he said should have been covered by Medicare. Republican leaders of the state legislature called a special session to provide the money. The start of the Medicare drug program "has been a nightmare for many of our citizens," Governor Lynch said.
"Many are being charged unaffordable co-payments for prescription drugs - co-pays much higher than they are supposed to be. Too many of them are leaving pharmacies without their prescriptions."
Thomas T. Noland Jr., a spokesman for Humana Inc., a major national insurer, said that some problems were "to be expected in a new program with lots of new enrollment taking effect all at once."
Cynthia G. Tudor, a senior Medicare official, told insurers on Wednesday that they must "immediately make improvements" to "ensure that all beneficiaries get their prescriptions filled at the point of sale."
In a memorandum to insurers, Ms. Tudor said she had received "numerous reports" that they were "inappropriately denying some scripts," or claims. In many cases, she said, insurers are not providing the data that pharmacies need to file claims and get paid.
Roseanne Pawelec, a spokeswoman for the federal Medicare agency, said Saturday that federal officials were working closely with states to address their concerns and to help individual beneficiaries.
"Things are improving on a daily basis," she said. "As computer systems catch up with late December enrollment, the problems are rapidly disappearing."
But in an interview on Friday, Stan Rosenstein, the Medicaid director in California, said: "We are hearing more and more complaints. A significant number of people are not getting their prescriptions. That has us very troubled."
Drug benefits are delivered by private insurers under contract to Medicare. The federal government is supposed to compute the subsidy available to each low-income beneficiary. But Michael Polzin, a spokesman for Walgreens, said that, in many cases, that information had not been shared with insurers or pharmacists.
Under Medicare rules, each drug plan is supposed to have a transition policy, providing a temporary supply - typically 30 days - of any prescription that a person was previously taking. But customer service representatives at Medicare's toll-free telephone number said they knew nothing of this requirement, and beneficiaries said it had been virtually impossible to take advantage of it.
Nationwide, 6.2 million low-income people receive both Medicare and Medicaid. About 1.1 million of them live in California. They tend to have many chronic illnesses and high drug costs. Cheryl Meronk, manager of the health insurance counseling program in Orange County, Calif., said she was referring people to hospital emergency rooms because they had been unable to get urgently needed medications through Medicare.
Under the standard Medicare drug benefit, which took effect on Jan. 1, the patient pays a $250 deductible and 25 percent of the next $2,000 in annual drug costs.
Over the last year, Medicare officials repeatedly assured poor people that they would receive extra help, so they would not have to pay any deductible and their co-payments would not exceed $5 for a prescription.
But Carol A. Herrmann-Steckel, commissioner of the Alabama Medicaid Agency, said that Medicare beneficiaries with very low incomes had often been required to pay the full $250 deductible and co-payments far exceeding $5. "One beneficiary borrowed the money," she said. "Another charged the $250 on a credit card because she was in such dire need of the medicine."
Beverly R. Churchwell, an aide to the Alabama commissioner, said: "Some Medicare beneficiaries have not been able to get their medications. They are being turned away at the pharmacy."
John J. Morris, 42, of Ware, Mass., who has diabetes and multiple sclerosis, signed up for a Medicare drug plan on Nov. 16. The insurer told him his co-payments would not exceed $5, he said, but at the pharmacy this week, he was told he had to pay $23 for each of three drugs.
"I could not afford it," Mr. Morris said, "so I was not able to get my insulin or my M.S. drug."
In Oregon, Sandy K. Hata, a field manager for the state Department of Human Services, said: "We've had calls from people in tears who could not get their medications. These people were being asked to pay a $250 deductible and hundreds of dollars in co-payments."
Jane-ellen A. Weidanz, the Medicare project manager at the Oregon Department of Human Services, said: "The $250 deductible "is hitting people very hard. People are very angry and very upset. They are yelling at us. They feel that we lied to them. They feel Medicare lied to them. They feel they cannot trust anything we say about this program."
Texas reported a similar problem. Low-income beneficiaries are "being charged incorrect (high) co-payments," the state's Health and Human Services Commission said in an e-mail message to the Dallas office of the federal Medicare agency.
In Oklahoma, low-income Medicare beneficiaries were often charged the $250 deductible. "They are being treated as if they were in a higher income bracket," said Mike Fogarty, chief executive of the Oklahoma Health Care Authority. "It's a common problem."
Steven E. Hahn, a spokesman for AARP, which offers a drug plan insured by UnitedHealth Group, said he knew that some low-income people had had difficulty getting medications. "We are taking this very seriously," he said. "This is a global problem, a systemwide problem, for all plan sponsors."
Elizabeth L. Stone, 86, who lives alone in an apartment in Manchester, N.H., is enrolled in both Medicare and Medicaid, has arthritis and a thyroid condition and is confined to a wheelchair. She tried to use the new Medicare benefit to fill a prescription this week, but failed.
"I did not get any medication," Ms. Stone said. "People at the pharmacy would not give it to me because they do not know how they will be reimbursed."
Another low-income beneficiary, Terence J. Stevens, 65, of Lakeland, Fla., said he signed up for the drug plan on Nov. 15, the first day on which enrollment was allowed. His plan tried to charge him a $47 co-payment for a drug to treat irregular heartbeats and high blood pressure. Mr. Stevens said he was unable to pay and did not get the drug.
In Alabama, William M. Beasley, a pharmacist and a Democratic member of the state House of Representatives, said, "I have had more difficulty trying to process claims for Medicare recipients than I've had with any other insurer in 43 years as a pharmacist."
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