# Presentation: 701806

## Medicare Prescription Drug, Improvement, and Modernization Act of 2003

- Department of Health & Human Services

- December 30, 2003

## 41 million beneficiaries
$284 billion in expenditures
Need for supplemental coverage

- $284 billion in expenditures
- Need for supplemental coverage

- MEDICARE TODAY

## RATIONALE FOR REFORM

- More choices and better benefits
- Modernize Medicare to reflect changes to the health care system
- Improve access to care

## KEY COMPONENTS OF THE LAW

- Medicare-Approved Drug Discount Card
- New Preventive Benefits
- Prescription Drug Benefit
- Medicare Advantage Program
- Assistance for Rural and Other Providers to strengthen access to care for people with Medicare

## MEDICARE-APPROVEDDRUG DISCOUNT CARD 

- Estimated savings of 10–25% on many drugs
- Enrollment as early as May 2004
- $600 to provide immediate relief to certain low-income people with Medicare

## Available January 2006

- NEW MEDICAREPRESCRIPTION DRUG BENEFIT

- $250 beneficiary deductible
- Medicare will pay 75% of drug costs up to $2,250.  The beneficiary will pay 25% of these costs
- Beneficiary will pay100% of drug costs between $2,250 and $3,600 in out-of-pocket spending
- After $3,600, Medicare will pay approximately 95%

## Extra Help for People with Low Income

- People below 100% of the Federal poverty level will be entitled to Medicare and full Medicaid coverage
- Income limits will be set in 2005
- Other people with low income and limited assets will get help paying premiums and deductibles

## MEDICARE ADVANTAGE PROGRAM

- New Medicare Advantage program with better benefits and more choices
- Payments to Medicare Advantage plans to increase in 2004

## MEDICARE ADVANTAGE PROGRAM

- Important new plan choices begin in 2006
- Most important new option - Regional preferred provider organizations (PPO).  PPOs are among the most common and popular plans right now for Americans not eligible for Medicare.

## ASSISTANCE FOR RURAL PROVIDERS

- $25 billion in increased reimbursement
- Improve access to doctors, hospitals, ambulances, and home health care for people in rural areas

## PAYMENTS TO NON-RURAL PROVIDERS

- Part A
- Part B

## OTHER IMPORTANT PROVISIONS

- “Welcome to Medicare” Physical Exam for New Enrollees
- Cardiovascular Screening Blood Tests
- Diabetes Screening Tests

- New Preventive Benefits
- Available January 2005

## OTHER IMPORTANT PROVISIONS

- Contracting reform
- HHS to conduct appeals process
- Changes in Medigap coverage
- Competition program
- Income-related Part B premium

## COMMUNICATING WITH THE PUBLIC

- Beneficiaries
- Providers
- Congress
- Governors and State Legislators
- Advocates
- Other stakeholders

## OPEN DOOR

## SOME MAJOR IMPLEMENTATION DATES

- January 2004 – Increase payments to rural hospitals; Physician payments increased
- March 2004 – Increased Medicare Advantage payment rates
- Enrollment as early as May 2004 – Drug Discount Card
- January 2005 – Preventive benefits; Physician scarcity bonus payments
- January 2006 – Prescription Drug Benefit; Regional Medicare Advantage Plans (PPOs)

**Notes:**
rural hospitals; Physician payments increased
March 2004 – Increased Medicare Advantage payment rates
Enrollment as early as May 2004 – Drug Discount Card
January 2005 – Preventive benefits; Physician scarcity bonus payments
January 2006 – Prescription Drug Benefit; Regional Medicare Advantage

## 1-800-MEDICARE
www.medicare.gov
www.cms.hhs.gov

- www.medicare.gov
- www.cms.hhs.gov

- FOR MORE INFORMATION

## Slide 18