DRX Trends

How Does the Supreme Court Review of the Affordable Care Act Affect Medicare Part D?

There are two necessary conditions before a Supreme Court decision will affect your Part D operations. First, the Court must overturn some portion of the Patient Protection and Affordable Care Act (ACA). Second, the Court must rule that it cannot overturn only a portion of the law.  As a mitigating factor, Congress can act to reverse the effects of an overturn of the ACA’s Medicare Annual Election Period (AEP) and coverage gap provisions, but, of the two provisions, only AEP would likely be added to any potential “technical corrections” bill.

The Supreme Court’s review of the Patient Protection and Affordable Care Act of 2010 (also called the ACA, PPACA, or Healthcare Reform Act) will focus on the ACA’s two most contentious elements: the individual mandate and the expansion of Medicaid.

However, the Medicare Part D program could also be affected if two conditions are fulfilled:

1. The Supreme Court overturns the individual mandate or the Medicaid portions of the ACA, and
2. The court believes these provisions are not severable from the rest of the act. (That is, the entire law must be overturned, not just the parts ruled against.) 

Since many provisions of the ACA are inextricably linked, AHIP has filed a brief supporting the position that the court’s decision to overturn any portion of the act cannot be severable.  The concern is that if the individual mandate is overturned, the portions of the ACA mandating guaranteed issue must also be overturned to avoid placing unbearable costs on health carriers. 

What does all this mean for Part D? 

Two operational changes in the ACA affect Part D: 

1. A change to the Annual Election Period (AEP) that begins and ends earlier than the original AEP in the Medicare Modernization Act (MMA), and
2. The closing of the coverage gap in the benefit structure of Part D plans, both with the branded drug discount and the overall gap closure that includes generic drugs.

If the AEP provision is overturned after judicial review, the most straightforward result is a return to the calendar used from 2007-2011. Under that calendar, enrollment begins on November 15^th and closes on December 31^st of the year, with marketing activities beginning on October 15^th of the year.

The ACA’s earlier Medicare AEP generally helps reduce operating costs for all parties, including plan carriers and the Centers for Medicare & Medicaid Services (CMS). The earlier AEP also ensures that beneficiaries who enroll at the end of the AEP will be covered by January 1^st, something that was nearly impossible under the old AEP calendar.  If the AEP provision is overturned after the Supreme Court’s review, it may be possible for Congress to pass a “technical corrections” bill restoring the new (Oct 15 to Dec 7) AEP calendar.

Unfortunately, addressing any overturn to the coverage gap closure by adding it to a “technical corrections” bill would be difficult in prosperous times and may be impossible today, given the current overall Federal budget picture. 

Even though the coverage gap closure is desired by many beneficiaries and has helped some carriers build share, it would receive less support from the manufacturers who used this as their bargaining chip in the ACA’s drafting phase.  Without the delivery of additional insured lives under the ACA, manufacturers may be less keen on cutting their revenue.

Further hurting the chances that Congress would address this issue through a technical corrections bill is that the coverage gap closure results in higher costs borne by taxpayers. In contrast, the earlier AEP is neutral or even money-saving in its effects.

The legislative follow-up to any overturn of the provision closing the coverage gap is still murky for all of these reasons.  However, it is crystal-clear that the out-of-pocket costs of drugs in the Part D coverage gap would revert immediately to the old pricing should the ACA be completely overturned. 

This would be an incredible operational headache for plans and PBMs unprepared for such an eventuality.  Although CMS is likely to issue guidance in advance of any Supreme Court decision, the operational planning relative to the expected timing of the Court’s decision (June 2012) is problematic given the proximity to bids and other CMS data submissions.

Should your carrier be affected by the rulings and subsequent regulatory changes, DRX technology is capable of implementing contingent pricing and flexibility on very short notice. 

 

Online Enrollment Conversion: Four Quick Tips for Plan Sponsors

With the close of Medicare open enrollment earlier this month, many plan sponsors may have already begun thinking about ways to increase their enrollment rates for next year.

One approach may be to focus on enhancing the online plan shopping experience, so that visitors can quickly and easily compare plans and submit an application for enrollment. What are some of the key features of this experience that increase enrollment applications? 

1. Clean design, minimal text.  It is tempting to be flashy, animated and overly colorful. However, there is a clear inverse relationship between the quantity of text and the number of applications submitted. When it comes to online enrollment, the less visual noise, the better. Branding, of course, should be prominent, but the focus of the page should be the simple form fields, with a clean and functional design (for example, as in Figure 1). Unnecessary visuals tend to distract the user from the primary purpose -- completing the shopping process and enrolling in your plan.

Figure 1. A simple, clean design with minimal text helps drive online applications for plan enrollment.

2. Fewer clicks. There is also an inverse relationship between the number of clicks and the number of applications submitted. The easier it is for users to find the pages that will allow them to compare and enroll in a plan, the better. And, if a user wants to enroll without shopping around -- that is, by going directly to enrollment for a plan they already have in mind -- it should be easy for them to do so.

3. Easy identification and correction of mistakes. Compliance is a key benefit of an online enrollment channel. If an applicant improperly fills out a field on a paper application, it won’t be caught for days, maybe weeks. Online, errors can be identified and corrected immediately. Online design should insure that error messages provide a simple explanation of the required corrections (Figure 2). 

Figure 2. Mistakes should be easy for visitors to identify and correct.

4. Data saved from step to step. If a user enters content via multiple pages, data should not be lost if he or she goes back to a previous page. If visitors have to re-enter information, it can mean the difference between submitting the application or not.

With these four simple tips, plan sponsors can ensure that users benefit from a better shopping and enrollment experience.

 

DRX Adds 100th Therapeutic Class to DrugCompare: Pancreatic Enzyme Products (PEPs)

DRX is pleased to announce that pancreatic enzyme products (PEPs) are the newest addition to the DRX DrugCompare database. These products, which have just recently fallen under FDA regulation, are used at each meal by thousands of patients with cystic fibrosis, chronic pancreatitis and other disorders of the pancreas to improve food digestion. Patients who rely on PEPs will now be able to identify new cost savings opportunities using the DRX DrugCompare technology.

The potential for cost savings from switching from one FDA-approved PEP to another can be significant. In our recent analysis, we found that switching from Pancreaze® to Creon® can provide cost savings from $205 to $395 per month ($2,460 and $4,740 per year) for cash-paying patients. Medicare beneficiaries in a prescription drug program can also realize savings by switching from Pancreaze® to Creon® or Zenpep® (typically in a lower tier), resulting in a copay cost savings of approximately 50%.

With the addition of PEPs, DrugCompare now covers 100 therapeutic classes and nearly 85% of the top 200 pharmaceutical drugs sold in the United States – a powerful tool for plan sponsors, employers and consumers seeking savings on prescription drug costs.

As we move forward into 2012, DRX will continue to look at ways of expanding the number of therapeutically equivalent drug mappings available to consumers and clients through our drug comparison technology.

DRX Technology Streamlines Enrollments for Medicare Sales Organizations

During open enrollment, Medicare sales organizations rely on DRX technology to streamline and simplify the plan comparison and enrollment process. This October, independent national insurance broker Longevity Alliance was the latest to announce a strategic agreement with DRX.

Longevity Alliance will now use DRX's PlanCompare and BrokerLink technology to enable dynamic Medicare plan comparison and enrollment through Longevity's iquote.com web property.

Highlights:

• The direct-to-consumer Medicare portal on iquote.com will feature multi-carrier quoting for Medicare health and prescription drug plans using data fed by DRX from carriers and updated on the same cycle as medicare.gov. 
• Health plan comparisons include a detailed look at full benefits and total costs for CMS-approved carriers, including true out-of-pocket cost calculations that account for the beneficiary's health status and current prescription drug regimen.
• Drug plan comparisons include full prescription drug, formulary, and pharmacy pricing.

Medicare sales organizations are responsible for over two million enrollments each year. DRX technology is a powerful resource that connects them directly to carriers, empowers agents to help clients make informed purchasing decisions, and streamlines enrollments.

10 Million+ Beneficiaries Have Been Enrolled in Medicare Plans Using DRX Tools

This November marks an important DRX milestone: the enrollment of over 10 million beneficiaries into a Medicare plan using a licensed DRX tool.

PlanCompare, DRX’s online suite of tools for plan comparison and enrollment, allows beneficiaries to make informed decisions about Medicare prescription drug plans, Medicare Advantage plans and Medicare Supplemental plans based on total annual costs (accounting for both premiums and out-of-pocket costs), and then enroll in the plan option that best meets their needs.

What are some of the other key PlanCompare milestones?

• 2004: DRX licenses proprietary PlanCompare technology to the Centers for Medicare and Medicaid Services (CMS) for the Prescription Drug Discount Card Program

• 2005: Medicare Part D and Medicare Advantage plan comparison and enrollment tools are added to the PlanCompare suite

• 2010: Medicare Supplemental plan comparison and enrollment tools are added

• 2011: DRX launches BrokerLink, connecting Medicare health plans with senior sales organizations and other exchange providers to further streamline beneficiary enrollments

• 2011: Over 10 million Medicare beneficiaries are enrolled into a Medicare plan using a licensed DRX tool

DRX’s Medicare plan comparison and enrollment tools—which are found on Medicare.gov and on the web portals of America’s largest health plans, Fortune 500 employers, brokers, agents, and other organizations that license these exchange products—not only facilitate enrollments, but also reduce costs for all involved, ultimately benefiting the overall Medicare system.

 

DRX's Jim Yocum in Today's Wall Street Journal

The Wall Street Journal spoke to DRX's Executive Vice President, Jim Yocum, about comparing Medicare plans during the annual enrollment period, which kicks off October 15th this year.   

From the article:

Another change will be the new importance of Medicare's star quality ratings...The top and lowest-ranked plans will be highlighted, and Medicare Advantage plans will be able to get bonus payments for higher star ratings, which are based on areas including customer service and beneficiaries' health. Beneficiaries will be able to switch into a plan with five stars, the best score, at any time of year.

Seniors can already figure out how plans scored on the individual components of the general star rating, such as the amount of time customers spend on hold and the accuracy of the information they get when they call with questions, says Jim Yocum, an official at DRX, a company that provides drug-plan comparison tools to the Medicare site.

Read the full "Medicare Enrollment" story here.

Preparing for Annual Enrollment: Comparing Medicare Plans

A recent study shows that as few as 7% of beneficiaries may be enrolled in the lowest-cost Medicare prescription drug plan available for them. This means that many beneficiaries may not be in the best plan to meet their needs.

And, since Medicare plan savings can vary from year to year, even those enrolled in the lowest-cost option for 2011 could benefit from a different plan—one that is a better fit—in 2012.

Medicare beneficiaries can quickly and easily see how their Medicare plan stacks up with a DRX-powered PlanCompare tool, also available at Medicare.gov. The PlanCompare tool is also licensed by many of America’s largest health plans, employers, and consumer advocacy organizations. Starting October 1^st, Medicare beneficiaries will be able to use the plan comparison tool on these sites to begin reviewing 2012 Medicare health and drug plan information.  

 

Once they’ve identified the best plan for their needs, they can enroll online during Medicare open enrollment, which runs this year from October 15^th though December 7^th.

Over the years, more than 9 million beneficiaries have enrolled in a Medicare plan using a DRX-powered tool.

Preparing for Annual Plan Enrollment: Medicare 101 for Beneficiaries

The Medicare Annual Enrollment period will take place this year from October 15^th through December 7^th.  For an easy-to-understand explanation of the key things beneficiaries should know about Medicare, take a look at DRX's Medicare 101 guide. Beneficiaries can also find additional tips on preparing for the annual enrollment period here.

DRX at Health 2.0 in San Francisco

Today, DRX's Matt Parker will be demonstrating Mobile DrugCompare at Health 2.0 in San Francisco. Matt presents at 2:45pm PT as part of the Medication and Care management Panel.

 
 
Mobile DrugCompare, launched this August, is the mobile version of DRX's DrugCompare site. It allows users to view and compare drug savings and safety information from the convenience of a mobile device -- right at the point of prescription.

 
 

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