10 Things Every Psychiatrist Should Know About Medicare Part D

This new federal outpatient prescription drug benefit, which begins January 1, 2006, is available to all Medicare beneficiaries, including those who are dually eligible for Medicaid and currently receive their drugs through their state Medicaid plans. The Centers for Medicare and Medicaid Services (CMS) oversees the program.

The benefit will be administered through private prescription drug plans (PDPs) that meet Medicare guidelines for the program. People with Medicare have to select which plan being offered in their region best meets their needs. The country has been divided into 34 regions.

Effective January 1, 2006, Medicaid will no longer pay for prescription drugs covered by Medicare for dual-eligible beneficiaries, approximately 2.5 million of whom have psychiatric illnesses. CMS will inform dual eligibles of the low-cost plan in their region into which they will be auto-enrolled if they fail to enroll in a plan by January 1, 2006. If they do not want the plan that CMS has selected for them, they may choose another plan but will have to pay any cost difference. To make their transition to the Medicare benefit go more smoothly, psychiatrists are advised to give these patients refill prescriptions to the extent allowed before December 31, 2005.

Dual eligibles will automatically receive a low-income subsidy that will cover their plan premium (provided they stay with a low-premium plan). Patients who are eligible for Medicare and meet income qualifications ($14,355 or less for an individual or $19,245 or less for a couple in 2005) should have already received a notice encouraging them to apply for a low-income subsidy; if they haven't, they can get an application at their local Social Security office or state medical assistance office. A fact sheet on financial assistance, with application, is also posted at<www.medicare.gov/medicarereform/help.asp>, and more information is available at<www.mentalhealthpartd.org>.

Beginning this month, specific information about PDPs and their formularies is available by phone at (800) Medicare [(800) 633-4227] or online at<www.medicare.gov> and<www.mentalhealthpartd.org>. This information should allow beneficiaries to determine which plan will best serve their needs.

CMS has stated that all or substantially all of the medications currently available in the classes of antidepressants, antipsychotics, and anticonvulsants should be on the formulary of every PDP. PDPs are permitted to use prior authorization, step therapy, and other utilization-management protocols and are permitted to require documentation for off-label use. Drugs used for the treatment of substance use disorders, however, do not appear to be covered (see story at bottom of facing page).

Benzodiazepines and barbiturates are excluded from Part D coverage. States may continue to cover these drugs for dual eligibles.

Almost all beneficiaries, including dual eligibles, are required to make a copayment for each prescription. Copays will vary by plan. Pharmacies are permitted to waive copays but are not required to do so when individuals are unable to pay, as under Medicaid.

Physicians may request coverage for a nonformulary drug, an exception to a high copay requirement, or an exception to a utilization-management requirement such as prior authorization. PDPs have 72 hours to respond to requests. An expedited determination may be requested for a decision within 24 hours if the standard timeframe could be harmful to the patient's medical condition. If the coverage determination is unfavorable, an expedited redetermination can be requested, and there is a stipulated appeals process in place that continues to the federal district court level.

Under Medicaid, when an appeal regarding a nonformulary drug is in process, the program must provide a supply of the drug. This is not the case with Part D Medicare. Patients must purchase their own drugs or find an alternative.