Democrats say Medicare Handbook could be misleading for beneficiaries choosing 2007 coverage options, according to letter sent to HHS Secretary Leavitt

[Oct 27, 2006]--Senate and House Democrats this week in a letter to HHS Secretary Mike Leavitt said that the Bush administration has used a Medicare handbook on coverage options for beneficiaries to promote Medicare Advantage plans, rather than to provide objective information, CQ HealthBeat reports.

The letter -- signed by Sens. Max Baucus (D-Mont.) and Jay Rockefeller (D-W.Va.) and Reps. Sherrod Brown (D-Ohio), John Dingell (D-Mich.), Charles Rangel (D-N.Y.) and Pete Stark (D-Calif.) -- states that the handbook, which the administration has mailed to 43 million beneficiaries, promotes the cost savings associated with MA plans compared with traditional Medicare but fails to inform beneficiaries that the plans can require higher out-of-pocket costs.

According to the letter, a recent Commonwealth Fund study "found that some MA plans charge as much as $300 per day for hospital care and $5,600 for cancer chemotherapy."

The letter adds, "For beneficiaries in poorer health who get admitted to a hospital several times a year or need cancer care, MA costs could be far higher" than traditional Medicare.

The letter also suggests that the handbook implies that changes in Medicare prescription drug plan formularies can occur only "as a result of changes in drug therapies or as new medical knowledge becomes available," CQ HealthBeat reports.

However, according to the letter, Medicare prescription drug plans "can and do change their formularies for business and other reasons, and beneficiaries should know this.

" Although it is too late to change the handbook, according to CQ HealthBeat, the letter adds that "equally biased and problematic" language on the Medicare Web site "could be corrected virtually overnight."

Reaction
CMS officials on Thursday in a statement said that they used recommendations from various groups -- such as outside organizations that help Medicare beneficiaries enroll in prescription drug plans -- to prepare the handbook "in a clear, comprehensive and objective manner."

HHS spokesperson Christina Pearson said that "throughout this process, we've sought and incorporated input from those outside the department and are always willing to consider constructive suggestions." She added that the criticism of the handbook from Democratic lawmakers "runs counter to the comments we've received from hundreds of beneficiaries, organizations and officials" (Reichard, CQ HealthBeat, 10/26).

Democratic Rx Drug Benefit Proposals
In related news, a report compiled by the Democratic staff of the House Government Reform Committee has found that Democratic proposals to revise the Medicare prescription drug benefit would save the average beneficiary $500 annually and would eliminate coverage gaps without an increase in cost for the federal government, CQ HealthBeat reports.

According to the report, a Democratic proposal to allow Medicare to negotiate directly with pharmaceutical companies for discounts on medications would save almost 14 million beneficiaries more than $60 billion in premiums, copayments and other out-of-pocket costs.

Democratic proposals also would allow six million Medicare beneficiaries to avoid the so-called "doughnut-hole" coverage gap in which beneficiaries are responsible for 100% of annual prescription drug costs between $2,250 and $5,100, the report found.

 n addition, more than one million Medicare beneficiaries would avoid hundreds of dollars in late enrollment penalties under Democratic proposals, according to the report. Pearson said that Medicare beneficiaries currently save an average of $1,100 on their annual medication costs under the prescription drug benefit.

In addition, she said that the Congressional Budget Office and CMS actuaries have determined that the proposal to allow Medicare to negotiate directly with pharmaceutical companies for discounts on medications would not reduce costs for beneficiaries.

Pearson also said that about 70% of Medicare beneficiaries with drug coverage currently are enrolled in prescription plans with no coverage gap and that about six million low-income beneficiaries pay no premiums for their plans (CQ HealthBeat, 10/