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Kerry Weems, acting administrator, Centers for Medicare and Medicaid Services | On the Hot Seat

Medicare chief on road again to plug prescription drug plans

(Jay Premack for The Boston Globe)
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December 23, 2007

January will mark the start of the third year of Medicare Part D, the government prescription drug benefit. But after two years, many consumers still find the drug benefit confusing. Consumers Union, the nonprofit that publishes Consumer Reports, recently said a government-administered benefit would save millions compared with the current system in which drug and insurance companies run private plans. Globe reporter Jeffrey Krasner recently spoke with Kerry Weems, acting administrator of the Centers for Medicare and Medicaid Services, when his Medicare bus stopped at a senior center in Charlestown, about how to choose the best drug plan before the 2008 open enrollment ends Dec. 31.

Q: If you've had a Part D drug plan for the last two years, how should you approach your choice this time around?

A: Beneficiaries will get a notice of changes directly from their drug plans. They should look at that. We're encouraging everybody to shop around even if they're happy with their plans. The way to shop around is to go to our website, medicare.gov. They should have a list of their medications. Go to the website, put in those drugs. The plans in your area will come up. The next question to ask is, are the plans convenient? Is there a drug store close to me? Do I want to get my drugs through the mail? Then they should look at cost. The website will show them their monthly expenses.

Q: Are most people seeing prices go up or down? Avalere Health recently published a study saying those who stay with the same plan are seeing prices go up around 20 percent.

A: Prices are very stable. The average premium is $25. The Avalere study looked at a couple of particularly low-cost plans, and those plans have low-income beneficiaries moving in and out of them. That's not as clean a study as we'd like to see. Also, with very low-cost plans, a couple dollars change can produce 20 percent increases. In dollar terms, it's not that large.

Q: In 2006, the first year of Part D, we had more than 40 plans in Massachusetts. For 2008, we're up to 51. What do you think about that level of choice? At some point does choice become a burden?

A: We want to make sure a consumer can sort these things out. If they use our webfinder tool, the top three plans will come out.

Q: Will we reach a time when a bus tour and an outreach program won't be necessary to get people to sign up for Part D?

A: One of our primary reasons for the bus tour this year is to sign up low-income beneficiaries who qualify for extra help. We're targeting ZIP codes where our low-income beneficiaries need to sign up.

Q: What can people do if they're going to fall into the "doughnut hole," the coverage gap where you have to pay out-of-pocket for drugs?

A: Many plans cover generics through the coverage gap. For a lot of people, that feature gives them the help they need.

Q: Consumers Union recently came out in favor of a government-administered Part D drug plan, saying it would save even more money. What's your opinion?

A: I disagree. To save money, you have to have a formulary of drugs covered under the plan. You have to choose which drugs you want to cover. The government would have to set up that formulary. We'd have to hire a company to do it, or hire a big bureaucracy to do it.

Q: You've already got one.

A: Actually, I don't have a big bureaucracy. There are only 4,600 people in the Centers for Medicare and Medicaid Services that administer $600 billion. That's a pretty small bureaucracy. Then the next big thing that would happen is a congressman would write in and say,'Why isn't this drug on the formulary?' " Part D has depoliticized individual drugs. I don't get mail about how come you cover this drug or that drug.

Q: What else do readers need to know if they haven't yet chosen a drug plan for 2008?

A: They should take time. I'd encourage your readers to make this a family event. Have a conversation with family members about your drug plan.

Kerry Weems, acting administrator, Centers for Medicare and Medicaid Services

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