Fwd: MEDICARE NEWS PROPOSED RULE TO EXPAND PLAN CHOICES TO MEDICARE BENEFICIARIES

[Guest guest]

Department of Health & Human

Services

Centers for Medicare & Medicaid

Services

Room 303-D

200 Independence Avenue, SW

Washington, DC 20201

Public Affairs Office

MEDICARE

NEWS

FOR IMMEDIATE

RELEASE

Jan. 7,

2008

CMS ISSUES PROPOSED RULE TO EXPAND PLAN CHOICES TO

MEDICARE BENEFICIARIES WITH LIMITED INCOMES AND RESOURCES

Today, the Centers for Medicare & Medicaid Services (CMS) announced a

proposed regulation that aims to allow more Medicare beneficiaries with

limited income and resources to remain in the Medicare prescription drug

plan in which they are enrolled without having to pay a premium.

Medicare beneficiaries with limited income and resources, and those who

are dually eligible for both Medicare and Medicaid, may qualify for extra

help paying for their Part D premium and cost-sharing through the

low-income subsidy (LIS), provided by Medicare.

Premiums for Medicare prescription drug coverage are based on

prescription drug plan bids projecting the cost for providing coverage

for the following year, costs that can change from year to year.

Based on the bids, as required by law, CMS calculates the amount of the

premium that will be paid for by Medicare for low-income beneficiaries in

each region. As a result of premium and subsidy changes, the

premium for any individual Part D plan can be fully covered by the

subsidy in one year and not the following year. During the annual

election period each fall, CMS randomly reassigns certain LIS-eligible

beneficiaries to another Part D plan if they would otherwise have to

begin paying a premium because their plan’s premium will be higher than

the amount subsidized by the Federal government.

“Through this proposed rule, we are seeking comment on a means of

reducing the number of beneficiaries subject to random reassignment while

maintaining the integrity of the annual bid process,” said CMS acting

Administrator Kerry Weems. “We expect changes adopted in the final

rule to be effective in the 2009 benefit year.”

Specifically, CMS is proposing, under certain conditions, to allow

prescription drug plan sponsors to offer a reduced premium amount for

certain individuals eligible for the low-income subsidy. The

proposal, which would apply in regions where there otherwise would be

fewer than five prescription drug plan sponsors with a “zero-premium”

plan option for limited income beneficiaries, would help to ensure there

are a sufficient number of organizations offering such plans and increase

the number of LIS-eligible enrollees in those regions who could remain

with their current plan without having to pay a premium.

The proposed rule will be published in the Federal Register on

January 8, 2008 and the final rule is expected to be issued on March

28, 2008 to ensure that the final policy is included in the Part D Rate

Announcement on April 7, 2008. This will provide Part D sponsors

with time to account for this policy as they calculate their Part D bids,

which are due on June 2, 2008.

The proposed rule can be found at

http://www.cms.hhs.gov/PrescriptionDrugCovContra/downloads/CMS4133P.pdf

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