Medicare Drug Benefit Will Use New Electronic Technologies to Simplify Drug Purchasing

The Centers for Medicare and Medicaid Services (CMS) today took another step to make it easier for Medicare beneficiaries to get the drugs they need from their local pharmacies when the Medicare prescription drug benefit begins on January 1, 2006.

In collaboration with pharmacies, pharmacy benefit groups, and other private sector organizations involved in filling prescriptions, CMS will implement new electronic systems to help pharmacists use the Medicare drug benefit and coordinate the amount that beneficiaries pay for their drugs with their other drug benefits. This electronic "coordination of benefits" system will ensure that what seniors pay at the pharmacy's counter takes into account the proper level of their Medicare coverage.

"Beneficiaries should be able to walk up to the pharmacy counter at any drug store in their drug plan's network and be assured that their coverage will work smoothly, even if they don't have any of their drug benefit information with them," said CMS Administrator Mark B. McClellan, M.D., Ph.D. "Pharmacists will be able to use the computer systems they already have in place with many drug plans to determine which Medicare drug plan to bill and whether the beneficiary has other drug coverage to contribute toward any balances, all while the beneficiary is at the counter. They will also be able to let the beneficiary know about less expensive generic alternatives. We are taking this step to learn which systems and technologies do the best job addressing the needs of the plans, the pharmacists and, most importantly, the beneficiaries."

Just like in many commercial insurance plans, Medicare drug plans will need to calculate the amount that they and their beneficiaries have paid for drugs to ensure that beneficiaries pay no more than necessary. This process needs to include coordination of other programs the beneficiary may enroll in, such as state pharmacy or retiree programs, to further protect beneficiaries from being charged more than they should.

In the request for proposals issued today, CMS describes specifications and features for tested technologies that will be used in a new system to enable drug plans to track and calculate where millions of beneficiaries are in their individual out-of-pocket spending. This would enable beneficiaries to get information on their own coverage limits without having to submit all of their receipts. In addition, this information will be available online so pharmacists can correctly process the beneficiary's next claim. The technological solution that CMS will use was developed with technical input from pharmacists, experts in pharmacy transactions, health plans, and other experts, building on existing technologies that already provide electronic support for pharmacy transactions nationwide today.

"Studies show that pharmacies today spend nearly a quarter of their time resolving insurance matters for beneficiaries," said Dr. McClellan. "We are looking for the best systems to make the prescription drug transactions for the Medicare drug benefit work smoothly, so beneficiaries and the taxpayers know they are paying the right amount for prescription drugs, and pharmacists can spend more of their time helping patients use their medicines effectively."

Medicare's standard drug benefit will pay 75 percent of a beneficiary's drug costs up to $2,250 a year after a $250 deductible is met. If out-of-pocket costs rise above $3600, the Medicare drug benefit pays 95 percent of all further drug costs for the year. Low-income beneficiaries receive comprehensive benefits with no gaps in coverage and little or no premiums for drug plans that cost no more than the average plan. Because the Medicare benefit is designed to work with other coverage, beneficiaries may get assistance with out-of-pocket and other costs from a former employer, a state, a charity, supplemental coverage that they purchase themselves, and other sources.

The requests for proposals have been posted on www.fedbizopps.gov Those interested can key in CMS2005Troop2 to find the relevant files.

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The source of this news article is http://www.cms.hhs.gov