It’s Finally Here!

It’s here!!! Managed Care Consultants’ inaugural newsletter has just hit the stands!!!….. Just kidding, but it is available to those who want it. And it’s FREE. Inside, we have described for you in detail who we are and what we do. We are ‘THE ‘educational resource guide to understanding Medicare for seniors. We are committed to enlightening those who are willing to learn and help prevent health care fraud. Just click the link below! Check back with us frequently, we’ve always got something new and interesting to share. We ” Tell It Like It Is.” Your opinions and comments on how we can improve are always welcome. Don’t be afraid to share your questions or concerns. We are a community of educators and we learn best from one another’s experiences. Take care and hope to hear from you. Don’t forget to click the MCC Newsletter link below!

Calvert Louden, MCC Newsletter 8-12

Prescription Drugs Don’t Come Cheap

Drug companies are at it again… Not only do they ruthlessly compete for large percentages of the prescription drug market, but now that ‘top-selling’ drug patents are expiring, they are cleverly finding ways to keep some consumers coming back for more. Quick question, “How many of you out there are bargain shoppers?” I would hope all, why waste money when you can get it for cheaper, right? Ok, “How many of you out there use coupons?” I can see thousands of ladies raising their hands right now with coupon clippings in hand, like ” Ooooh, I do, and I’m really good too. Saved myself $34 and some change last time out!” God I love the savvy consumer. Now, try putting those two concepts together and this is what you get…

As current economies, both the US and worldwide, continue to struggle, and health care costs steadily increasing, the price of doing business for prescription drug companies like Pfizer and the like is becoming too much to handle. Research and development for future drugs has become a more scrutinized process by the FDA, costing drug companies billions of dollars before getting final approval. In order to recoup this initial investment, the government has allowed Drug Companies exclusive rights to the market for 10-15 years before a generic equivalent can even be offered as a cost-saving solution to patients. So, after billions in profit and the drug companies’ patent is about to expire, one would think the smaller companies putting out generics can now get a piece of the pie, right? Wrong. Large Rx drug companies aren’t going to just ‘hand over’ a large part of the market like that without kicking and screaming. So, what have they done to offset this? You guessed it! Coupons.

Drug companies are taking a strategic and tactical but simplistic approach to offsetting the loss of billions of dollars in revenue to generic drug makers by offering existing or prospective patients coupons for discounts on monthly brand name prescriptions. I mean think about it, what better way to maintain a small percentage of your clientele base than to offer them incentive to stick around? Times are tough man; we have to save wherever we can, but (and drug companies love this…) we are also creatures of habit. We trust who we trust, who we know, even if that means spending a few extra dollars. This is exactly what large Rx drug companies are banking on. When the patent expires on brand name drugs, generic equivalents flood the market and can be offered for as low as 90% below the cost of brand names. At this point, most consumers usually switch. A massive drop-off of consumer brand loyalty costs drug makers billions, unless they can ‘slow the bleeding.’ In this case, drug companies that offer coupons are effectively killing two birds with one stone. Here’s how…. By offering coupons, consumers are happy to maintain their brand loyalty without having to pay as much as before. And most importantly, they can continue to use a drug that they know works for them versus taking the chance with an unproven generic and its side effects. This is great news!… except for one thing…. “The coupons only work with private insurance, though. Patients with Medicare or other government health insurance are barred from using them.”

Hold on a sec. So, if I understand this correctly, Rx drug companies are only going to incentivize people with private insurance? Isn’t that discriminatory? Yes. And there’s nothing you can do about it. If you are a Medicare beneficiary or qualify for government health insurance, like Medicaid, you do not get to participate in the coupon party. That stinks!!! Medicare/Medicaid beneficiaries who live off of Social Security/Supplemental Security Income (SSI), respectively, are expected to continue to pay the rising costs of Rx drugs or they are forced to switch to generics. Has anyone considered the ramifications of this?! What if seniors or these low-incomed individuals end up worsening their health condition due to the side effects of switching to generics? What happens then? Are we to just look the other way, and tell them to “stick with what works?” Oh, and by the way, in order to safely monitor your condition, you will need to continue to spend hundreds of dollars a year, even though we know you cannot afford it. So much for keeping the consumer’s best interests at heart. Where’s the compassion? Im sorry, I forgot that we were talking about Rx drug companies here. It’s a business and only that. As long as their bottom line doesn’t fall too far too fast that is all they are concerned with.

Not surprisingly, commercial insurers don’t like the coupons, because their share of the cost for a brand-name drug is much higher than for a generic pill. Virtually all prescription plans automatically switch patients to a new generic drug [once available] the next time they refill their prescription. The [Rx] plans also move the drug from the copayment level [usually Tier 2] for most brand-name drugs, usually around $25, to their highest copayment level [usually Tier 3], often $50 to $75 per prescription. [This is to force patients to accept the move to generic drugs because Tier 3 drug cost-sharing for insurance company is more expensive than the cost-sharing for a generic; this method is preferred by the insurance company, regardless of the effect, whether financial or physical, on the beneficiary.] The coupons throw a wrench into insurers’ strategy of getting as many patients as possible to take generic drugs, which account for about 80 percent of all prescriptions filled in the U.S. [To combat this, drug makers are] also signing unprecedented deals with dozens of insurers that lower their (the insurer’s) portion of the cost of [a brand drug] to what a generic would cost them — [as long as] they covered only brand [name ‘X’] for [x amount of time]. That meant both patients and insurers had a big financial incentive to stick with [the brand name drug] for a while.

Drug makers use coupons to fight generics, by Associated Press Aug, 20,2012

So, where do we go from here? I don’t know, it’s tough to say. For right now, it is what it is. Medicare/Medicaid beneficiaries are excluded from the rewards of brand loyalty. I apologize that I unfortunately could not give you any definitive answers as to how to approach or circumnavigate this issue. I hope by asking questions about these incentive ‘kick-backs’ I might be able to raise eyebrows for someone, somewhere, who in a place of power or authority can say ” What are we doing, are we really allowing this to happen?” By generating discussion we can bring to light our concerns. Until then, only time will tell.

Health reform helps more than 5.1 million people with Medicare save over $3.2 billion

Since enactment of the health care law, Medicare beneficiaries received average savings of $635 on prescription drugs

As the second anniversary of the Affordable Care Act approaches, new data shows that more than 5.1 million seniors and people with disabilities on Medicare saved over $3.2 billion on prescription drugs because of the new health care law, Kathleen Sebelius, Secretary of the U.S. Department of Health and Human Services (HHS), announced today while at the St. Louis Community College at Forest Park.

For St. Louis resident Fritzi Lainoff and her husband, the discounts meant $2,500 back in their pockets last year. “It was a blessing,” she said. “The law’s Medicare savings have made an enormous difference.”

Savings for seniors include a one-time $250 rebate check to seniors who hit the “donut hole” coverage gap in 2010 and a 50 percent discount on covered brand-name drugs in the donut hole in 2011.In addition, data released today by the Centers for Medicare & Medicaid Services (CMS) show that through the first two months of 2012, about 103,000 seniors and people with disabilities saved $93 million in the donut hole.

“Without the health care law, more than 5.1 million seniors would have faced $3.2 billion in higher drug costs,” Secretary Sebelius said. “As we move forward, seniors will save even more as the new law completely eliminates the Medicare donut hole, delivering more relief to Americans like the Lainoff’s.”In 2012, Medicare beneficiaries will receive a 50 percent discount from manufacturers on covered brand name drugs and a 14 percent savings on generic drugs in the donut hole. The Affordable Care Act expands these discounts over time until the donut hole is closed in 2020.“Already this year, tens of thousands of seniors and people with disabilities are starting to see increased savings as they enter the donut hole,” said CMS Acting Administrator Marilyn Tavenner. “The Affordable Care Act has made prescription drugs more affordable for Medicare beneficiaries, protecting the health and pocketbooks of millions of America’s seniors.”

For more information on how the Affordable Care Act closes the donut hole over time, please visit: http://www.healthcare.gov/law/features/65-older/drug-discounts/index.htmlFor a report on how the Affordable Care Act strengthened Medicare in 2011, please visit: http://www.cms.gov/apps/files/MedicareReport2011.pdfEn Español

HHS.Gov

MA-DP Deadline Quickly Approaching

The MADP,
Medicare Advantage Disenrollment Period, deadline is quickly approaching.
The MADP, which begins January 1st and runs until February 14th and replaces the Open Enrollment Period, is an opportunity for beneficiaries to return to Original Medicare. It is not an additional enrollment period nor is it an opportunity for Medicare Advantage members to switch to different MA Plans.
Allowable Actions during the MADP:

People enrolled in an MA-PD plan may disenroll from the MA-PD and will have the opportunity to enroll in a standalon Prescription Drug Plan (PDP). Important: MA-PD members who enroll in a standalone PDP during this period will be automatically disenrolled from their current MA-PD and will not have the option of enrolling in another Medicare Advantage Plan.

Members who are in a Medicare Advantage only plan may request disenrollment from the MA plan and will then receive a Special Election Period (SEP) to enroll in a PDP standalone plan. The SEP is available from the time the disenrollment request is made until the member enrolls in a PDP or after February 14, whichever comes first.

Members who have both a standalone MA and a standalone PDP may disenroll from the MA plan, but may not make a change to their current standalone PDP.

A beneficiary who disenrolls from an MA or MA-PD plan using the opportunity afforded by the MADP may enroll in a Medicare Supplement policy upon returning to Original Medicare. However, using the MADP does not give the beneficiary guaranteed issue rights under federal law to prevent health-based underwriting of the Med Supp policy. In some cases, State Medigap laws may offer additional guaranteed issue rights to beneficiaries who are affected by the MADP.

Members who have a standalone PDP, but are not enrolled in an MA plan may not make any change to their current PDP plan and may not enroll in an MA plan.

People with Original Medicare who are not enrolled in any Part C Medicare Advantage plan have no options under MADP to make any change in their Medicare coverage.

Note: The effective dates of the MA disenrollment under the MADP and the PDP enrollment under the coordinating Part D SEP do not have to be the same. If a beneficiary disenrolls from an MA plan, he or she has until the end of the SEP (February 14th) to enroll in a PDP. Thus an individual could disenroll from an MA plan in January (effective February 1) and not choose a PDP until February (effective March 1). However, the individual must make a PDP election by the end of this SEP or wait until the next valid Part D election period in order to enroll in a PDP. In all cases, the effective date for the enrollment in a PDP may not precede the date of the MA disenrollment.