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Medicare Prescription Drug Demonstration
50,000 will get early coverage for costly drugs

by Marian Anne Eure
for About.com

Updated June 29, 2004

About.com Health's Disease and Condition content is reviewed by our Medical Review Board

The initiative, known as the Medicare Replacement Drug Demonstration, was mandated under Section 641 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). As set by Congress, enrollment in the demonstration will be open to 50,000 people and total spending on the covered drugs will be up to $500 million.

Under this initiative, Medicare will pay for certain drugs and biologicals that can be taken by the patient at home and that replace drugs which are currently covered under Medicare Part B when given in a doctor’s office. In addition, newer, more effective medications that replace some currently covered oral anti-cancer drugs will also be covered.

Drugs for treatment of such diseases as rheumatoid arthritis, multiple sclerosis, pulmonary hypertension and a variety of cancers will be included in the demonstration. The drugs were selected based on criteria developed after extensive input from physicians and other experts. The drugs and the diseases that are covered are listed below.

Beneficiary cost sharing for these drugs will mirror the “standard” Medicare Part D prescription drug benefit when it is implemented in 2006 (participants will not pay the monthly premium in the demonstration, however). Beneficiaries with limited resources and incomes of less than 150 percent of the federal poverty level (FPL) will have even lower cost sharing requirements.

As directed by Congress in creation of the demonstration, approximately 40 percent of the funding will be allocated for oral anti-cancer medications. If more beneficiaries apply than Medicare is able to serve, CMS will select participants among the cancer and non-cancer groups randomly from the applications received, on an alternating basis between the two groups.

To be eligible for the demonstration, a beneficiary must be enrolled in Medicare Part A and Part B, Medicare must be their primary payer, and the beneficiary may not have comprehensive drug coverage through other sources (such as TriCare, Medicaid, or an employer or union sponsored plan). A beneficiary must also have a signed certification from a doctor that he or she requires one of the drugs covered under the demonstration for the indicated disease.

CMS is conducting an Open Door Forum on June 29 with patient advocacy groups, physician specialty groups, physicians and drug manufacturers so they can help beneficiaries in applying for the program.

To enroll in the demonstration program, beneficiaries should complete an application, get their physician to complete the required form certifying their need for the covered drug, and submit both forms to CMS’ demonstration contractor, TrailBlazer Health Enterprises.

Participants in the demonstration will be able to get their drugs at a local retail pharmacy or by home delivery through Caremark, Trailblazer’s subcontractor for administering the drug benefit.

The demonstration will run through Dec. 31, 2005, at which time all beneficiaries will be able to enroll in the new Medicare Part D drug benefit.

Starting immediately, applications may be downloaded from the CMS Web site. Starting July 6, customer service representatives will be available at 1-866-563-5386, TTY Number: 1-866-536-5387 to answer questions about the demonstration and assist beneficiaries in obtaining and completing the application forms. Between now and July 6, beneficiaries who have questions can call 1-800 MEDICARE. Applications will be accepted for consideration beginning July 6, 2004 through Sept. 30 2004.

Those beneficiaries who are able to get their applications in by Aug. 16 will be in an “early selection” process that will give them coverage by Sept. 1.

Applications will be accepted through Sept.30, at which time another selection process will be held. As long as the application is received by Sept.30, all applicants will have an equal chance to get into the demonstration. If enrollment slots are still available, applications will continue to be accepted after that date.

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