Department of Health and Human Services
 

OFFICE OF 

INSPECTOR GENERAL 

AVAILABILITY OF MEDICARE 


PART D DRUGS TO 


DUAL-ELIGIBLE NURSING HOME 


RESIDENTS 


Daniel R. Levinson
 

Inspector General 


June 2008 


OEI-02-06-00190
 
 

 

 

 

 

 

Office of Inspector General
 http://oig.hhs.gov 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 

amended, is to protect the integrity of the Department of Health and Human Services 

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enforcement authorities. 
 

Δ EXECUTIVE SUMMARY 

OBJECTIVE 

To assess the availability of Medicare Part D drugs to dual-eligible 

nursing home residents. 

BACKGROUND 

The Medicare Prescription Drug, Improvement, and Modernization Act 

of 2003 (MMA) established the Medicare Prescription Drug Program, 

known as Medicare Part D. The Centers for Medicare & Medicaid 

Services (CMS) contracts with private health insurance companies that 

sponsor Part D plans. Each Part D plan develops its own list of covered 

drugs, known as a formulary, and may also use utilization management 

tools, such as prior authorization, to control drug costs and dosages. 

Nursing homes typically have contracts with long-term care pharmacies 

to ensure safety and convenient access to drugs for residents. Under 

Part D, CMS requires that each plan offer a contract to any long-term 

care pharmacy that is willing to participate in its network. 

Dual-eligible beneficiaries are eligible to receive both Medicare and 

Medicaid coverage. Prior to Medicare Part D, Medicaid paid for most of 

the prescription drugs for dual-eligible nursing home residents. Under 

Part D, these residents now receive drug coverage through Medicare, and 

are eligible to have their premiums, deductibles, and copayments fully 

subsidized. 

This study focuses on ongoing implementation issues, as opposed to the 

issues related to the transition from Medicaid to Medicare that arose in 

the early stages of the benefit. It is based on structured interviews with a 

sample of nursing home administrators, medical directors, and directors of 

operations for long-term care pharmacies (referred to as pharmacy 

directors) conducted between September 2006 and March 2007. 

Estimates derived from administrators’ responses are projected to the 

population of administrators of nursing homes with dual-eligible residents. 

However, estimates derived from medical directors’ and pharmacy 

directors’ responses are limited to the sample respondents due to a low 

response rate and low usable sample size, respectively. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - E LIGIBLE NURSING H OME RESIDENTS i 
 

 

 

 

E X E CUTIVE S U MMAR Y 
 

FINDINGS 

Most respondents reported that dual-eligible nursing home 

residents are receiving all necessary Part D drugs. Ninety-three 

percent of nursing home administrators reported that dual-eligible 

residents in their nursing homes are receiving all necessary Part D drugs. 

About 4 percent of administrators reported that at least one dual-eligible 

resident in each of their nursing homes is not receiving needed drugs 

from their Part D plans or any other sources. They explained that some 

of these residents changed their Part D plans or were transferred to 

hospitals to receive the drugs they needed; others went without the drugs 

entirely. The majority of medical directors and pharmacy directors whom 

we interviewed also reported that dual-eligible nursing home residents 

are receiving all necessary Part D drugs. 

Nursing homes and long-term care pharmacies sometimes pay for 

Part D drugs that are not covered by plans. Forty-five percent of 

administrators reported that their nursing homes paid for at least one 

Part D drug for dual-eligible residents. As several administrators 

explained, nursing homes may pay for these Part D drugs to comply 

with Federal regulations and Conditions of Participation that require 

nursing homes to ensure that residents receive needed drugs in a timely 

manner. Additionally, 77 percent (61 of 79) of the pharmacy directors 

whom we interviewed reported that their pharmacies paid for at least 

one Part D drug for dual-eligible residents in the sampled nursing 

homes. Administrators and pharmacy directors explained that the 

drugs they most commonly pay for either are not on the residents’ plans’ 

formularies or require prior authorization. Several pharmacy directors 

explained that not all plans cover the cost of a short-term supply of 

drugs during the prior authorization process. 

Respondents express concerns that formularies, the prior 

authorization process, and copayments may pose problems for 

dual-eligible nursing home residents. About one-fifth of nursing home 

administrators and a similar proportion of the medical directors and 

pharmacy directors whom we interviewed are concerned that plan 

formularies may not meet all of the needs of some dual-eligible nursing 

home residents. For instance, several medical directors noted that the 

therapeutically equivalent drugs on the formulary are not always 

appropriate for residents because they may cause adverse side effects or 

may not be in the proper form. Additionally, about one-fifth of 

administrators and a similar proportion of the medical directors and 

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EXECUTIVE SUMMARY 

pharmacy directors expressed concerns that the prior authorization 

process can be burdensome. The majority of pharmacy directors also 

reported that some dual-eligible residents are being incorrectly 

identified as required to pay copayments. 

Concerns also exist that long-term care pharmacies generally do not 

disclose to physicians the rebates that they receive from drug 

manufacturers. According to our interviews, long-term care pharmacies 

have continued to receive rebates from drug manufacturers under Part D 

and they generally do not disclose these rebates to physicians. More than 

half of the pharmacy directors whom we interviewed reported that their 

pharmacies receive rebates from drug manufacturers, but only three of 

these pharmacy directors reported that their pharmacies provide any 

information to nursing homes or to physicians about the rebates that they 

receive. Pharmacists employed by these long-term care pharmacies can 

influence the drugs that are prescribed to residents in nursing homes both 

when drugs are initially ordered and during monthly drug regimen 

reviews. Taken together, these issues raise concerns that rebates may 

create incentives for pharmacists and consultant pharmacists to 

recommend certain drugs over others based on financial considerations as 

opposed to clinical considerations and that physicians may not be aware of 

these incentives when deciding whether to take pharmacists’ 

recommendations. 

RECOMMENDATIONS 

Based on these findings, we plan to do additional work on long-term 

care pharmacy rebates. In addition, we recommend that CMS take the 

following actions: 

Work with plans to ensure that formularies meet the needs of 

dual-eligible nursing home residents. During its formulary review 

process, CMS should put additional emphasis on ensuring that plans 

include the drugs and alternative dosages and forms that meet the 

needs of dual-eligible nursing home residents. 

Continue to work with plans to improve the prior authorization 

process. CMS should clarify existing guidance to ensure that plans pay 

for a supply of drugs for current enrollees during routine prior 

authorization requests. Further, CMS should specify under what 

circumstances a supply of drugs would qualify as being an emergency 

supply. CMS should also work with plans to ensure that plan staff are 

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EXECUTIVE SUMMARY 

responsive and knowledgeable about Part D formulary and coverage issues 

that are specific to dual-eligible nursing home residents. 

Ensure that copayments for dual-eligible nursing home residents 

are fully subsidized, as appropriate. CMS should continue its efforts 

to ensure that residents are properly identified as dually eligible and as 

residing in nursing homes. CMS should also work with plans to ensure 

they are using “best available data” when they have knowledge that a 

beneficiary is being inappropriately charged copayments. CMS should 

also consider educating long-term care pharmacies and nursing homes 

about what “best available data” they can provide to plans. 

Consider methods to encourage long-term care pharmacies to 

disclose to physicians information about rebates that they receive 

from drug manufacturers. We recognize that CMS does not have the 

authority under Part D to require long-term care pharmacies to disclose 

the rebates that they receive from drug manufacturers. However, CMS 

can consider methods to encourage long-term care pharmacies to 

disclose to physicians information about their rebates. Because 

long-term care pharmacists can influence the drugs that are prescribed 

to residents in nursing homes, it is important that physicians be aware 

of any potential financial incentives that pharmacists may have to 

recommend one drug over another. 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

CMS concurred with two of our recommendations and the intent of the 

third recommendation; it did not concur with our last recommendation. 

CMS stated that it will work with plans to ensure that formularies meet 

the needs of dual-eligible nursing home residents and continue to work 

with plans to improve the prior authorization process. CMS concurred 

with the intent of our third recommendation to ensure that copayments 

for dual-eligible residents are fully subsidized, as appropriate. CMS did 

not concur with our fourth recommendation to consider methods to 

encourage long-term care pharmacies to disclose to physicians 

information about rebates that they receive from drug manufacturers. 

CMS stated that it does not have authority under Part D to require 

long-term care pharmacies to disclose their rebates to physicians. We 

recognize that CMS does not have the authority to require pharmacies 

to disclose rebate information to physicians. However, we continue to 

recommend that CMS consider additional ways to encourage 

pharmacies to disclose this information to physicians so that they are 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS iv 
 

 

EXECUTIVE SUMMARY 

aware of any potential financial incentives that pharmacists may have 

to recommend one drug over another. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS v 
 

Δ TABLE OF CONTENTS 

EXECUTIVE SUMMARY ..................................... i 
 

INTRODUCTION ........................................... 1 
 

FINDINGS ................................................. 9 
 

Dual-eligible residents are receiving necessary Part D drugs..... 9 
 

Nursing homes and pharmacies sometimes pay for drugs ...... 10 
 

Concerns exist that formularies, the prior authorization process, 

and copayments may pose problems ....................... 11 
 

Concerns also exist that long-term pharmacies generally do not 

disclose to physicians the rebates that they receive from drug 

manufacturers ........................................ 14 
 

RECOMMENDATIONS ..................................... 16 
 

Agency Comments and Office of Inspector General Response . . . 17 

APPENDIXES ............................................. 20 
 

A: Confidence Intervals for Selected Estimates .............. 20 
 

B: Common Process for Obtaining Drugs ................... 21 
 

C: Agency Comments ................................... 22 
 

ACKNOWLEDGMENTS .................................... 28 
 
 

 

 

 

 

Δ INTRODUCTION 

OBJECTIVE 

To assess the availability of Medicare Part D drugs to dual-eligible 

nursing home residents. 

BACKGROUND 

The Medicare Prescription Drug, Improvement, and Modernization 

Act of 2003 (MMA) established the Medicare Prescription Drug 

Program, known as Medicare Part D.1 The Part D benefit provides 

prescription drug coverage for Medicare beneficiaries, including 

dual-eligible beneficiaries who are eligible to receive both Medicare 

and Medicaid coverage. Approximately one in four dual-eligible 

beneficiaries resides in a long-term care facility such as a nursing 

home.2 This benefit is particularly important for nursing home 

residents, who frequently have multiple chronic diseases and take an 

average of 8 to 10 medications a day.3 

The implementation of Part D significantly changed prescription 

drug coverage for dual-eligible nursing home residents. Prior to 

Medicare Part D, Medicaid paid for most of the prescription drugs for 

dual-eligible nursing home residents. Under Part D, these residents 

now receive drug coverage through Medicare and must enroll in 

private Part D prescription drug plans. 

This study focuses on ongoing implementation issues, as opposed 

to the issues related to the transition from Medicaid to Medicare 

that arose in the early stages of the benefit. It provides 

information on the extent to which dual-eligible residents are 

receiving needed drugs under Part D and identifies issues specific 

to this population. 

The Medicare Prescription Drug Benefit 

The Centers for Medicare & Medicaid Services (CMS) contracts 

with private health insurance companies, known as sponsors, to 

1 MMA, P.L. No. 108-173, title I, § 101 et seq. (codified at 

42 U.S.C. § 1395w-101 et seq. and 42 U.S.C. § 1396u-5). 

2 Government Accountability Office, “Medicare Part D Challenges in Enrolling 

New Dual-Eligible Beneficiaries,” May 2007, p. 11. 

3 The Lewin Group, “CMS Review of Current Standards of Practice for Long-Term
 

Care Pharmacy Services: Long-Term Care Pharmacy Primer,” 

December 30, 2004, p. 1. 

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INTRODUCTION 

provide the Medicare Part D benefit. These sponsors may offer a 

stand-alone prescription drug plan (PDP) or they can offer 

prescription drug coverage as a part of a managed care plan 

known as a Medicare Advantage Prescription Drug Plan (MA-PD). 

Throughout this report, we will refer to PDPs and MA-PDs as 

Part D plans. 

On January 1, 2006, dual-eligible nursing home residents were 

automatically enrolled in randomly assigned eligible Part D plans 

if they had not already selected one.4 Unlike other Medicare 

beneficiaries, dual-eligible beneficiaries may change their plans at 

any time.5 Further, dual-eligible nursing home residents are 

eligible to have any premiums, deductibles, or copayments fully 

subsidized for prescription drugs covered under Medicare Part D.6 

Formularies and Utilization Management Tools 

Each Part D plan develops its own list of covered drugs, known as 

a formulary, which must meet certain standards. Each plan’s 

formulary must contain at least two drugs within each therapeutic 

category and pharmacologic class.7 It must also cover “all or 

substantially all” of the drugs in six categories: 

immunosuppressant, antidepressant, antipsychotic, 

anticonvulsant, antiretroviral, and antineoplastic classes.8 CMS 

reviews each plan’s formulary to ensure that it provides access to 

appropriate treatments for all diseases and is not designed to 

discourage enrollment by any particular group. 

Certain classes of drugs are excluded from coverage by Part D. 

These include benzodiazepines, barbiturates, weight management 

drugs, and over-the-counter drugs.9 Furthermore, Part D 

generally excludes from coverage any drug that is covered under 

Part A or Part B.10 Several factors must be considered to 

determine whether a drug is covered under Part A, B, or D, such 

as setting, characteristics of the patient, medical use of the drug 

4 42 U.S.C. § 1395w-101(b)(1)(C); see also 42 CFR § 423.34. 

5 42 CFR § 423.38(c)(4). 

6 42 U.S.C § 1395w-114; see also 42 CFR §§ 423.780 and 423.782.
 

7 42 CFR § 423.120(b)(2)(i). 

8 CMS, “Prescription Drug Benefit Manual,” Chapter 6—Part D Drugs and 

Formulary Requirements, § 30.2.5. 

9 42 U.S.C. § 1395w-102(e)(2)(A) and 42 U.S.C. § 1396r-8(d). 

10 42 U.S.C. § 1395w-102(e)(2)(B). 

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INTRODUCTION 

and its form, and the method of administration.11 CMS issued 

guidance in its Prescription Drug Benefit Manual which details 

the circumstances under which Parts A, B, and D cover drugs. 

Plans may use utilization management tools to control drug costs 

and dosages.12 These tools include prior authorization, step 

therapy, or quantity limitations. As is generally known, prior 

authorization requires a beneficiary to seek prior approval from 

the plan to receive a drug on the formulary. Step therapy requires 

the beneficiary to try a less-expensive alternative drug before the 

plan will cover a specific drug. Quantity limitations restrict the 

amount of the drug that can be prescribed or the number of refills 

per prescription. 

Plans must have an exceptions process whereby beneficiaries may 

request that the plan cover a drug that is not on the formulary.13 

Additionally, beneficiaries may appeal adverse coverage 

determinations through an appeals process.14 In 2006, CMS 

collaborated with the American Medical Association and America’s 

Health Insurance Plans to develop a standardized form for the 

exceptions and prior authorization processes. Although plans are 

allowed to have their own forms, they are required to accept this 

form.15 

In addition, CMS provided guidance to plans about covering 

nonformulary drugs under certain circumstances. For 2006, CMS 

required plans to have a transition policy and recommended that 

they provide nursing home residents who are new enrollees with 

temporary supplies of nonformulary drugs for 90 to 180 days. 

CMS also encouraged plans to cover one-time supplies of drugs for 

current enrollees during the exceptions process and for 

11 CMS, “Prescription Drug Benefit Manual,” Chapter 6—Part D Drugs and 

Formulary Requirements, Appendix C-1 and C-2. Available online at: 

http://www.cms.hhs.gov/PrescriptionDrugCovContra/Downloads/PDBMChap6For
 

mularyReqrmts_03.09.07.pdf. Accessed on November 7, 2007. 

12 42 CFR § 423.153. 

13 42 CFR § 423.578. 

14 42 U.S.C. § 1395w-104(h). 

15 CMS, “Frequently Asked Questions: Coverage Determination Request Forms, 

Physician Supporting Statements & Processing Timeframes for Exceptions and
 

Prior Authorizations.” Available online at 

http://www.rxassist.org/providers/documents/CMSAppealsExceptionsFAQs_000.pdf.
 

Accessed on October 31, 2007. 

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INTRODUCTION 

beneficiaries who were transitioning into new care settings, such 

as nursing homes.16 For 2007, CMS required plans to cover a 

90-day supply of nonformulary drugs and drugs requiring prior 

authorization or step therapy for new enrollees who are nursing 

home residents.17 Further, CMS required plans to provide up to a 

31-day emergency supply of nonformulary Part D drugs and drugs 

requiring prior authorization or step therapy for current nursing 

home residents while an exception is being processed. 

Long-Term Care Pharmacies 

Nursing homes typically have contracts with long-term care 

pharmacies to ensure safety and convenient access to drugs for 

residents.18 Given the resident population’s needs, these 

pharmacies provide specialized services, such as a comprehensive 

inventory of drugs commonly used in long-term care settings, 

specialized packaging, intravenous therapy medications, 

7-day-a-week delivery, pharmacy on-call services, and emergency 

medications.19 Under Part D, CMS requires that each plan offer a 

contract to any long-term care pharmacy that is willing to 

participate in its network and is capable of meeting minimum 

performance and service criteria.20 

Long-term care pharmacies have historically received rebates from 

drug manufacturers. According to CMS, these rebates are 

intended to “prefer, protect, or maintain that manufacturer’s 

product selection by the pharmacy or to increase the volume of 

16 CMS, “Information for Part D Sponsors on Requirements for a Transition
 

Process, March 2005.” Available online at 

http://www.ascp.com/medicarerx/upload/transition_process.pdf. Accessed on 

October 31, 2007. 

17 CMS, “Transition Process Requirements for Part D Sponsors, April 2006.” 

Available online at 

http://www.ascp.com/medicarerx/upload/CY07TransitionGuidance.pdf. Accessed 

on October 12, 2007. 

18 70 Fed. Reg. 4194, 4250 (Jan. 28, 2005). 

19 CMS, “Long-Term Care Guidance, March 16, 2005.” Available online at 

http://www.cms.hhs.gov/PrescriptionDrugCovContra/Downloads/LTCGuidance.pdf. 

Accessed on July 31, 2007. 

20 70 Fed. Reg. 4251; see also ibid. 

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INTRODUCTION 

that manufacturer’s products that are dispensed by the pharmacy 

under its formulary (referred to as ‘moving market share’).”21 

Beginning in 2007, long-term care pharmacies are required to 

report to the Part D plans with which they contract the rebates 

that they receive.22 

Federal Requirements for Nursing Homes 

Federal law requires nursing homes to ensure that residents are 

provided with all drugs needed to fulfill the residents’ plans of 

care.23 Specifically, as a condition of participation in the Medicare 

or Medicaid programs, nursing homes must provide or arrange for 

the provision of “pharmaceutical services (including procedures 

that assure the accurate acquiring, receiving, dispensing, and 

administering of all drugs and biologicals) to meet the needs of 

each resident.”24 If a nursing home enters into a contract with a 

pharmacy to provide pharmaceuticals, the nursing home is 

responsible for the quality and timeliness of pharmaceutical care 

and services.25 CMS guidance also instructs nursing homes to 

provide these drugs in a timely manner and as ordered by the 

prescriber.26 

Federal regulations also require nursing homes to arrange for a 

pharmacist to review each resident’s drug regimen at least 

monthly. 27 Most nursing homes contract with licensed 

pharmacists, commonly known as consultant pharmacists, to 

conduct these drug regimen reviews. Consultant pharmacists 

must report any irregularities they find during these reviews to 

21 CMS, “Medicare Part D Reporting Requirements, Contract Year 2007.” 

Available online at 

http://www.cms.hhs.gov/PrescriptionDrugCovContra/Downloads/PartDReportin 

gRequirements_CurrentYear.pdf. Accessed on October 5, 2007. 

22 Ibid. 

23 A plan of care describes the medical, nursing, and psychosocial needs of the 

resident and how such needs will be met; see 42 U.S.C. § 1396r(b)(2)(A).
 

24 42 U.S.C. § 1396r (b)(4)(A)(iii); see also 42 CFR § 483.60. 

25 42 CFR § 483.75(h). 

26 Noncompliance can result in a citation during the routine survey process. 

42 CFR § 483.75(h); see also CMS, “State Operations Manual, Appendix PP–

Guidance to Surveyors for Long-Term Care Facilities,” Rev. 26, 8-17-07, pp. 430 

and 442. 

27 42 CFR § 483.60(c). 

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INTRODUCTION 

the attending physician and the director of nursing and these 

reports must be acted upon.28 

Related Work 

The Medicare Payment Advisory Commission (MedPAC) recently 

issued a report entitled “Medicare Part D, Nursing Homes, and 

Long-Term Care Pharmacies.”29 The report found that many 

stakeholders described Part D as a better fit for beneficiaries in 

the community than for beneficiaries in institutions such as 

nursing homes. Stakeholders noted that although formulary 

coverage appears adequate for many medications used by nursing 

home residents, they had concerns about obtaining certain drugs 

and about utilization management tools being burdensome for 

clinical and pharmacy staff. 

METHODOLOGY 

Scope 

We based this study on our analysis of structured interviews with a 

sample of nursing home administrators, medical directors, and 

directors of operations for long-term care pharmacies who have 

firsthand knowledge about Part D for dual-eligible nursing home 

residents. We conducted these interviews between September 2006 

and March 2007. 

Sample 

We selected a simple random sample of 150 nursing homes from 

CMS’s Online Survey and Certification Reporting database. We 

limited our sample to all nursing homes that had at least 

10 Medicaid-certified or dually certified (both Medicare- and 

Medicaid-certified) beds. We excluded 6 of the 150 sampled 

nursing homes from our review because they informed us that 

they did not have any dual-eligible residents in 2006. Our sample 

included the remaining 144 nursing homes. 

28 Ibid. 

29 MedPAC, “Medicare Part D, Nursing Homes, and Long-Term Care 

Pharmacies,” June 2007. Available online at 

http://www.medpac.gov/documents/Jun07_Part_D_Contractor.pdf. Accessed on 

October 5, 2007. 

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INTRODUCTION 

Nursing Home Administrators 

We conducted structured telephone interviews with each of the 

administrators at the nursing homes in our sample. We also 

requested that the director of nursing participate in the interview, 

if possible. 

We asked each administrator about his or her experiences with 

Medicare Part D for dual-eligible residents. We focused our 

questions on whether dual-eligible residents are receiving all 

necessary Part D drugs, i.e., drugs that are eligible for coverage 

under Part D.30 We also asked what happens when a resident 

needs a drug that is not on his or her plan’s formulary or needs a 

drug that is on the formulary but has utilization management 

requirements, such as prior authorization. Further, we asked 

what, if any, concerns they had about Part D for dual-eligible 

residents. 

We interviewed a total of 128 administrators from the 144 sample 

nursing homes, resulting in an 89-percent response rate. 

According to the administrators, approximately 7,800 dual-eligible 

residents lived at these nursing homes at the time of our review. 

Appendix A provides confidence intervals for selected estimates. 

Nursing Home Medical Directors 

We conducted structured telephone interviews with each of the 

medical directors for the nursing homes in our sample. The 

medical director is responsible for the implementation of 

resident care policies and the coordination of medical care at the 

facility.31 The director may also serve as the attending 

physician for residents in the nursing home. 

We asked each medical director questions similar to those that 

we asked the administrators. We interviewed a total of 

95 medical directors from the 144 sampled nursing homes, 

resulting in a 66-percent response rate. 

Directors of Operations for Long-Term Care Pharmacies 

We conducted structured telephone interviews with each of the 

directors of operations of the long-term care pharmacies for the 

30 We gave all respondents explicit instructions related to excluded drugs and 

reminded them throughout the interview not to consider excluded drugs when 

answering the questions. 

31 42 CFR § 483.75(i)(2)(i)-(ii). 

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INTRODUCTION 

nursing homes in our sample. The nursing homes contracted with 

a total of 139 long-term care pharmacies. We excluded 55 of these 

pharmacies from our study because they were under investigation 

by the Office of Inspector General (OIG) at the time of our review. 

We conducted interviews with a total of 79 directors of operations 

from the remaining 84 long-term care pharmacies. 

We asked each director of operations questions similar to those 

that we asked the other respondents. In addition, we asked them 

about the nature and extent of any rebates that they receive from 

drug manufacturers. We included these questions because of 

concerns that CMS officials raised. For the purposes of our report, 

we refer to these respondents as pharmacy directors. 

Limitations 

The information from our interviews with the administrators, 

medical directors, and pharmacy directors is self-reported; we did 

not independently verify their responses. Estimates derived from 

administrators’ responses are projected to the population of 

administrators of nursing homes with dual-eligible residents. 

However, estimates derived from medical directors’ and pharmacy 

directors’ responses are limited to the sample respondents. We did 

not project these estimates to the population due to the low 

response rate and low useable sample size, respectively. 

Further, we did not collect information about individual residents, 

such as their length of stay at a nursing home. In addition, we did 

not interview consultant pharmacists. 

Standards 

Our review was conducted in accordance with the “Quality 

Standards for Inspections” issued by the President’s Council on 

Integrity and Efficiency and the Executive Council on Integrity 

and Efficiency. 

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FINDINGS 

 

 

 

 

 

Δ F I N D I N G S FINDINGS 

Most respondents reported that 

dual-eligible nursing home residents are 

receiving all necessary Part D drugs 

Ninety-three percent of nursing 

home administrators reported 

that dual-eligible residents in 

their nursing homes are receiving 

all necessary Part D drugs.32 

Table 1: Nursing home administrators’ responses about residents’ 

receipt of Part D drugs

 Administrators 

Dual-eligible residents are receiving all Part D drugs 93% 

Dual-eligible residents are not receiving all Part D drugs 4% 

Don’t know 3% 

Source: OIG analysis of interview data, 2007. 

Table 2: Medical directors’ and pharmacy directors’ responses about 

residents’ receipt of Part D drugs 

Medical 

Directors 

Pharmacy 

Directors 

Dual-eligible residents are receiving all Part D drugs 73% 84% 

Dual-eligible residents are not receiving all Part D 

drugs 5% 4% 

Don’t know 21% 13% 

*Note: The responses of the medical directors and pharmacy directors are not projectable to the 

population. Additionally, totals may not equal 100% because of rounding. 

Source: OIG analysis of interview data, 2007. 

(See Table 1.) Administrators explained that physicians typically order 

drugs that are on the formularies of the residents’ plans. When a drug 

is not on the formulary or requires prior authorization, generally the 

physician changes the 

prescription to a drug that is on 

the plan’s formulary or 

complies with the utilization 

management requirements. 

See Appendix B for a 

description of how 

dual-eligible nursing home 

residents commonly obtain 

Part D drugs. 

About 4 percent of administrators reported that at least one 

dual-eligible resident in each of their nursing homes is not receiving 

needed Part D drugs from their Part D plans or any other sources. 

Administrators estimated that a total of 23 residents, or an average of 

4 residents in each of these nursing homes, had not received all 

necessary Part D drugs since the implementation of Part D. They 

explained that some of 

these residents changed 

their Part D plans or were 

transferred to hospitals to 

receive the drugs they 

needed; others went 

without the drugs entirely. 

As shown in Table 2, the 

majority of medical 

directors and pharmacy 

directors whom we 

interviewed also reported 

32 For the purposes of this study, Part D drugs include all drugs that are eligible for 

coverage under Part D. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 9 
 

 

 

FINDINGS 

that dual-eligible nursing home residents are receiving all necessary 

Part D drugs. Specifically, 73 percent (69 of 95) of medical directors and 

84 percent (66 of 79) of pharmacy directors reported that dual-eligible 

residents in the sampled nursing homes are receiving all necessary 

Part D drugs. However, 5 percent (5 of 95) of medical directors and 

4 percent (3 of 79) of pharmacy directors reported that at least one 

resident went without necessary Part D drugs. 

Nursing homes and 

long-term care pharmacies sometimes pay for 

Part D drugs that are not covered by plans 

Nursing home administrators 

and pharmacy directors 

reported that they sometimes 

pay for Part D drugs that are 

not covered by plans. In total, 

45 percent of administrators reported that their nursing homes paid for 

at least one Part D drug for dual-eligible residents. As several 

administrators explained, nursing homes may pay for these Part D 

drugs to comply with Federal regulations and Conditions of 

Participation that require nursing homes to ensure that residents 

receive needed drugs in a timely manner.33 Additionally, 77 percent 

(61 of 79) of the pharmacy directors whom we interviewed reported that 

their pharmacies paid for at least one Part D drug for dual-eligible 

residents in the sampled nursing homes. 

According to interviews with administrators and pharmacy directors, 

the drugs that they most commonly pay for either are not on the 

residents’ plans’ formularies or require prior authorization. For 

example, they may pay for a drug if the resident’s physician determines 

that there is no alternative drug on the formulary appropriate for the 

resident.34 They may also pay for a short-term supply of drugs during 

the prior authorization process. Several pharmacy directors explained 

that not all plans cover the cost of a short-term supply of drugs during 

the prior authorization process and, as a result, the nursing home or 

pharmacy may pay for these drugs during this time. 

Several respondents noted that paying for Part D drugs is causing a 

financial strain on their nursing homes. For example, one 

33 42 CFR § 483.60; 42 CFR Part 483; see also CMS, “State Operations Manual, Appendix
 

PP–Guidance to Surveyors for Long-Term Care Facilities,” p. 442. 

34 Medicare beneficiaries can request exceptions when their physicians prescribe drugs 

that are not on their plans’ formularies. However, only a few administrators specifically 

noted that residents had requested exceptions. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 10 
 

 

 

 

 

FINDINGS 

administrator stated that her nursing home budgets $10,000 per month 

for nonreimbursed drug costs. According to one medical director, the 

cost of these drugs may affect nursing home admissions practices 

because the nursing home may not admit patients if it cannot afford 

their medication. 

Respondents express concerns that 

formularies, the prior authorization process, 

and copayments may pose problems for 

dual-eligible nursing home residents 

Nursing home administrators as 

well as the medical directors and 

pharmacy directors whom we 

interviewed expressed several 

concerns about Part D that are 

specific to dual-eligible nursing 

OEI-02-06-00190 

home residents. In general, they have concerns about plan formularies, 

prior authorization, and residents being incorrectly identified as 

required to pay copayments. 

Respondents are concerned that formularies can be problematic for 

dual-eligible residents in nursing homes 

About one-fifth of nursing home administrators are concerned that plan 

formularies may not meet all of the needs of some dual-eligible nursing 

home residents. A similar proportion of medical directors and 

pharmacy directors whom we interviewed also reported concerns about 

plan formularies. Several medical directors specifically noted that the 

therapeutically equivalent drugs on the formulary are not always 

appropriate for residents because they may cause adverse side effects or 

may not be in the proper form. As one pharmacy director noted, the 

therapeutically equivalent drugs on one plan’s formulary cannot be 

administered via a feeding tube. 

Administrators and pharmacy directors further noted that plans do not 

always cover injectable anemia drugs, oral cancer drugs, and drugs 

administered by nebulizers. In general, these drugs can be covered by 

either Part D or Part B depending on the circumstances. For example, 

Part D covers drugs administered by nebulizers for beneficiaries in 

nursing homes, whereas Medicare Part B covers these drugs for 

beneficiaries who are at home.35 One pharmacy director noted that 

35 Medicare Part D only covers drugs that are not covered by Medicare Part B. 

See 42 U.S.C. § 1395w-102(e)(2)(B); see also CMS, “Prescription Drug Benefit Manual: 

Chapter 6—Part D Drugs and Formulary Requirements,” Appendix C-1 and C-2. 

Available online at 

http://www.cms.hhs.gov/PrescriptionDrugCovContra/Downloads/PDBMChap6Formulary 

Reqrmts_03.09.07.pdf. Accessed on November 7, 2007. 

AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 11 
 

 

 

 

 

FINDING 
 S 

some plans will not cover injectable drugs because the plans are not 

aware that the drugs are eligible for coverage under Part D for nursing 

home residents. One administrator explained that some plans are 

confused about whether these drugs should be covered under Part B or 

Part D. 

A number of medical directors were also concerned about how formulary 

restrictions may affect residents’ quality of care. As one medical 

director explained, although a resident may receive a drug, it may not 

always be the most effective drug. Others expressed concerns that 

switching drugs may increase medical errors or cause more negative 

health effects in the future, such as heart attacks and strokes. 

Respondents are concerned that the prior authorization process can be 

particularly burdensome in the nursing home setting 

About one-fifth of nursing home administrators expressed concerns that 

the prior authorization process can be burdensome. A similar 

proportion of the medical directors and pharmacy directors whom we 

interviewed also reported such concerns. Respondents commonly 

pointed out the amount of time they spend handling prior 

authorizations. Several explained that prior authorization forms and 

procedures vary across plans, which is particularly difficult because 

nursing homes have residents enrolled in many different plans. 

According to administrators, a typical nursing home works with an 

average of 10 different plans. 

Several pharmacy directors further noted that the prior authorization 

process may be lengthy because of problems with plans. They reported 

experiencing long wait times before being able to speak with plan staff. 

They also noted that plan staff sometimes lack sufficient knowledge of 

formulary and coverage issues specific to nursing home residents. 

A number of medical directors also stated that the burdensome nature 

of the process can affect patient care. For example, as one noted, the 

time nursing home staff and physicians spend on the prior 

authorization process reduces the time they can spend providing patient 

care. Additionally, as another medical director stated, to avoid dealing 

with the prior authorization process, some physicians may just switch to 

any drug in the category. Another medical director pointed out that the 

process can be too lengthy and patients may suffer because of delays in 

receiving drugs. 

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FINDINGS 

Dual-eligible nursing home residents are being incorrectly identified as 

required to pay copayments 

Dual-eligible beneficiaries residing in nursing homes are eligible to have 

their premiums, deductibles, and copayments fully subsidized for 

prescription drugs covered under Part D.36 CMS issued a memorandum 

in May 2006 clarifying that dual-eligible residents should not be 

charged copayments if they reside in nursing homes for at least 30 days 

and are under a covered Medicaid stay.37 The memorandum also 

outlined steps to address the issue, including instructing plans to use 

“best available data” when they have knowledge that a beneficiary’s 

cost-sharing level is not correct.38 It further directed plans to repay 

long-term care pharmacies for these copayments rather than 

beneficiaries because it is unlikely that the long-term care pharmacies 

have billed the beneficiaries for their copayments.39 

Despite the issuance of this memorandum, dual-eligible residents 

continue to be incorrectly identified as required to pay copayments. In 

fact, 80 percent (63 of 79) of the pharmacy directors whom we 

interviewed reported that dual-eligible nursing home residents were 

incorrectly identified by their plan as required to pay copayments in the 

last 3 months of 2006. Additionally, several pharmacy directors 

reported having large amounts of uncollected copayments. For example, 

one pharmacy director had approximately $300,000 in uncollected 

copayments. Another pharmacy director reported having over $75,000 

in uncollected copayments in the past year. 

Pharmacy directors explained that for a plan to assess zero copayments 

for these beneficiaries, it must recognize that these individuals are dual 

eligible and that they reside in nursing homes. About half of the 

pharmacy directors who offered an explanation reported that residents 

are not being properly identified as dual eligible. The other half of 

pharmacy directors reported that residents are not being properly 

identified as residing in nursing homes. 

36 42 CFR § 423.782. According to CMS, “[a]n individual is considered institutionalized 

and qualifies for a zero co-payment when he or she is a full benefit dual-eligible, a 

resident of a long-term care facility for a full calendar month, and under a covered 

Medicaid stay.”
 

37 CMS, “Incorrect Cost Sharing Charges to Dual-Eligible Beneficiaries” (May 5, 2006). 

38 For example, if a plan has knowledge from the nursing home that the beneficiary’s 

nursing home stay is covered by Medicaid, the plan should revise the copayment level. 

See ibid. 

39 CMS, “Incorrect Cost Sharing Charges to Dual-Eligible Beneficiaries” (May 5, 2006). 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 13 
 

 

 

 

 

FINDINGS 

Concerns also exist that long-term care 

pharmacies generally do not disclose to 

physicians the rebates they receive from 

drug manufacturers 

According to our interviews, 

long-term care pharmacies have 

continued to receive rebates from 

drug manufacturers under Part D 

and they generally do not disclose 

these rebates to physicians. In total, 

54 percent (43 of 79) of the pharmacy directors whom we interviewed 

reported that their pharmacy receives rebates from drug manufacturers 

either directly or through group purchasing organizations.40 These 

directors explained that rebates are often based on market share or 

volume. For example, one pharmacist, who receives rebates based on 

market share, explained that his rebates are based on the percentage he 

dispenses of a particular drug, compared to the percentage he dispenses of 

the competitor’s drug. Another pharmacy director explained that if 

90 percent or more of the insulin she sells is from a certain manufacturer, 

she receives a 1-percent rebate. 

Physicians may not be aware that pharmacies receive these rebates. Only 

three of the pharmacy directors we interviewed reported that their 

pharmacies provided information to nursing homes or to physicians about 

the rebates that they receive.41 

Rebates are a concern because pharmacists employed by these long-term 

care pharmacies can influence the drugs that are prescribed to residents 

when drugs are initially ordered. According to the nursing home 

administrators, when a physician orders a drug that is not on the 

formulary, the pharmacist commonly suggests one or two alternative 

drugs from a longer list of drugs on the formulary. The physicians 

typically follow the suggestions of the pharmacists. Specifically, the 

medical directors whom we interviewed reported that they make the 

pharmacists’ recommended changes about 78 percent of the time. 

In addition, pharmacists can influence the drugs that are prescribed 

during the drug regimen reviews. As described earlier, nursing homes are 

40 A group purchasing organization is an entity that uses collective buying power to 

obtain discounts from vendors. 

41 Long-term care pharmacies are required to report the rebates that they receive to 

plans; however, they are not required to provide this information to nursing homes or 

physicians. See Medicare Part D Reporting Requirements Contract Year 2008. 

Available online at 

http://www.cms.hhs.gov/PrescriptionDrugCovContra/Downloads/PartDReportingRequire 

ments_NextYear.pdf. Accessed on August 10, 2007. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 14 
 

 

 

FINDINGS 

required to have a consultant pharmacist review the drug regimens of all 

residents at least monthly. About 80 percent of the nursing home 

administrators reported that the consultant pharmacists who perform 

their drug regimen reviews are employees of the long-term care pharmacy 

that provide Part D drugs to their residents. During these reviews, 

consultant pharmacists can make recommendations to change residents’ 

drugs. The medical directors whom we interviewed reported that when 

consultant pharmacists recommend changing one drug for a different, 

therapeutically equivalent drug, they make these changes about 

74 percent of the time. 

Taken together, these issues raise concerns that rebates may create 

incentives for pharmacists and consultant pharmacists to recommend 

certain drugs over others based on financial considerations as opposed to 

clinical considerations and that physicians may not be aware of these 

incentives when deciding whether to take pharmacists’ recommendations. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 15 
 

 

 

 

Δ RECOMMENDATIONS 

According to most respondents, dual-eligible nursing home residents are 

receiving all necessary Part D drugs. This is due, in part, to nursing 

homes and long-term care pharmacies paying for some drugs that plans 

do not cover. In addition, respondents raised several concerns about 

Part D that are specific to dual-eligible nursing home residents 

including concerns about plan formularies, the prior authorization 

process, and copayments. We are also concerned that long-term care 

pharmacies receive rebates from drug manufacturers which create 

financial incentives to recommend certain drugs and that they do not 

generally disclose these incentives to physicians. Based on these 

findings, we plan to do additional work on long-term care pharmacy 

rebates. In addition, we recommend that CMS take the following 

actions: 

Work With Plans To Ensure That Formularies Meet the Needs of 

Dual-Eligible Nursing Home Residents 

CMS should work with plans to ensure that the drug needs of 

dual-eligible nursing home residents are taken into consideration. CMS 

reviews each plan’s formulary to ensure that it provides access to 

appropriate treatments for all diseases and is not designed to 

discourage enrollment by any particular group. During this review 

process, CMS should put additional emphasis on ensuring that plans 

include the drugs and alternative dosages and forms that meet the 

needs of dual-eligible nursing home residents. In addition, we recognize 

that CMS has issued guidance explaining when drugs should be covered 

by Part B or Part D. CMS should work with plans to ensure that 

dual-eligible residents do not have difficulty obtaining drugs under 

Part D that may be covered by Part B in other circumstances or patient 

settings. 

Continue To Work With Plans To Improve the Prior Authorization Process 

We recognize that CMS issued new transition guidance for 2007 

requiring plans to provide up to a 90-day supply of nonformulary drugs 

and drugs requiring prior authorization or step therapy prescribed for 

newly enrolled nursing home residents and up to a 31-day supply of 

such drugs for current enrollees while an exception is being processed. 

CMS should clarify existing guidance to ensure that plans pay for a 

supply of drugs for current enrollees during routine prior authorization 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 16 
 

 

 

RECOMMENDATIONS 

requests. Further, CMS should specify under what circumstances a 

supply of drugs would qualify as being an emergency supply. In 

addition, CMS should work with plans to ensure that plan staff are 

responsive and knowledgeable about Part D formulary and coverage 

issues that are specific to dual-eligible nursing home residents. 

Further, CMS should consider working with partners, such as the 

American Medical Association, to educate physicians about using the 

standardized form and about the transition policy. 

Ensure That Copayments for Dual-Eligible Nursing Homes Residents Are 

Fully Subsidized, as Appropriate 

CMS should continue its efforts to ensure that residents are properly 

identified as dually eligible and as residing in a nursing home. CMS 

should also work with plans to ensure they are using “best available 

data” when they have knowledge that a beneficiary is being 

inappropriately charged copayments. CMS should also consider 

educating long-term care pharmacies and nursing homes about what 

“best available data” they can provide to plans. 

Consider Methods To Encourage Long-Term Care Pharmacies To Disclose 

to Physicians Information About Rebates That They Receive From Drug 

Manufacturers 

We recognize that CMS does not have the authority under Part D to 

require long-term care pharmacies to disclose to physicians the rebates 

that they receive from drug manufacturers. However, CMS can 

consider methods to encourage long-term care pharmacies to disclose to 

physicians information about their rebates. Because long-term care 

pharmacists can influence the drugs that are prescribed to residents in 

nursing homes, it is important that physicians be aware of any potential 

financial incentives that pharmacists may have to recommend one drug 

over another. 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

In its comments on the draft report, CMS agreed that our review 

identifies potential issues with ensuring that dual-eligible nursing home 

residents are receiving all necessary Part D drugs and that further work 

is needed in the areas highlighted by the report. In addition, CMS 

concurred with our first two recommendations and the intent of the 

third recommendation; it did not concur with the last recommendation. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 17 
 

 

RECOMMENDATIONS 

CMS concurred with our first recommendation that it work with plans 

to ensure that formularies meet the needs of dual-eligible nursing home 

residents. CMS stated that it believes it substantially does this but will 

look for opportunities to improve. It will continue to work with its 

partners and monitor complaints regarding formularies and will adjust 

the formulary review process as necessary. It will also consider our 

recommendations as it constructs the formulary review checks for 

calendar year 2009 formularies. 

CMS concurred with our second recommendation to continue to work 

with plans to improve the prior authorization process. CMS noted that 

it issued a memorandum to Part D sponsors directing them to make 

plan prior authorization criteria available upon request of the 

beneficiary or physicians. CMS also stated that it would update its 

guidance in the next revision of Chapter 6 of the “Part D Manual” and 

ensure that long-term care beneficiaries have access to an emergency 

supply of drugs anytime during the plan year. Further, as CMS 

continues to work with long-term care partners and providers, it will 

emphasize protections available to long-term care beneficiaries, 

including the model coverage determination form, Part D plans’ 

transition processes, and emergency supplies. 

Although CMS concurred with the intent of our third recommendation 

to ensure that copayments for dual-eligible nursing home residents are 

fully subsidized, as appropriate, it expressed concern over the use of the 

term “waive” in the report. CMS requested that OIG not use “waive” in 

the context of Part D payments because, among other reasons, it may 

confuse the public because CMS describes payment and nonpayment of 

cost-sharing liability under Part D in a specific manner and also 

because waiving copayments would be a violation of Federal law. In 

response to CMS’s concerns over the potential for confusion, we 

modified the language of the report. We note, however, that Federal 

laws are not automatically violated if copayments are waived; rather, 

Federal laws may be implicated when providers, practitioners, and 

suppliers waive copayments for services or products and could 

ultimately result in criminal, civil, or administrative liability. 

In addition, in response to our third recommendation, CMS explained 

that currently it reports beneficiary copayment levels to Part D sponsors 

on a weekly basis, while States submit information to CMS on 

beneficiary dual eligibility and institutional status on a monthly basis. 

CMS stated that it is working to increase the frequency of State 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 18 
 

 

 

 

 

RECOMMENDATIONS 

reporting and its processing of these data. In addition, CMS stated that 

it has already taken a number of steps relative to its best available 

evidence policy. It posted a document to the CMS Pharmacy Listserv on 

the topic and established a separate complaint-tracking category for 

“best available evidence” issues. It also plans to release two tip sheets. 

CMS did not concur with our fourth recommendation to consider 

methods to encourage long-term care pharmacies to disclose to 

physicians information about rebates that they receive from drug 

manufacturers. CMS stated that it does not have authority under 

Part D to require long-term care pharmacies to disclose their rebates to 

physicians. CMS noted that to ensure that the rebates received by 

long-term care pharmacies do not create incentives that are contrary to 

a Part D plan’s formulary, it currently requires Part D sponsors to 

collect and review information regarding rebates received by their 

network long-term care pharmacies. We recognize that CMS does not 

have the authority to require pharmacies to disclose their rebates to 

physicians. However, we continue to recommend that CMS consider 

additional ways to encourage pharmacies to disclose this information to 

physicians so that they are aware of any potential financial incentives 

that pharmacists may have to recommend one drug over another. 

CMS also commented on the findings. In response to our first finding, 

CMS requested that we recalculate the data to exclude respondents who 

reported that they did not know whether residents received needed 

drugs. We included these responses in our analysis to ensure we 

present the data in a complete and unbiased manner. In response to 

our second finding, CMS agreed to issue clarified guidance. CMS noted 

that although the intent of the existing guidance was to cover 

nonformulary drugs during transition periods, it could issue clarified 

guidance. 

CMS made several comments related to our methodology. Specifically, 

CMS stated that it believes it is a serious omission that we did not 

interview consultant pharmacists because they operate independently of 

long-term care pharmacy directors in influencing drugs. As we noted in 

the report, about 80 percent of the nursing home administrators 

reported that the consultant pharmacists who perform their drug 

regimen reviews are employees of the long-term care pharmacy that 

provides Part D drugs to their residents. 

We made several technical changes based on CMS’s comments. The full 

text of CMS’s comments is included in Appendix C. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 19 
 

 

 

 

 

 

 

 

 

 

Δ APPENDIX~A 

Confidence Intervals for Selected Estimates for Nursing Home Administrators 

(Sample Size = 128) 

Estimate Description Point Estimate 

95-Percent 

Confidence Interval 

Percentage of nursing home administrators who reported that 

dual-eligible residents in their nursing home are receiving all 

necessary Part D drugs 

92.9% 88.5%–97.3% 

Percentage of nursing home administrators who reported that 

dual-eligible residents are not receiving all necessary Part D drugs 

3.9% 0.5%–7.3% 

Percentage of nursing home administrators who reported that they 

“do not know” whether dual-eligible residents are receiving all 

necessary Part D drugs 

3.1% 0.1%–6.1% 

Percentage of nursing home administrators who reported that their 

nursing homes paid for at least one Part D drug for dual-eligible 

residents 

44.5% 35.9%–53.1% 

Percentage of nursing home administrators who are concerned 

about plan formularies may not meet all of the needs of some 

dual-eligible nursing home residents 

20.0% 13.1%–26.9% 

Percentage of nursing home administrators who expressed 

concerns that the prior authorization process can be burdensome 

18.0% 11.3%–24.7% 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 20 
 

 

Δ APPENDIX~B 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 21
 
 

 

Δ APPENDIX ~ C 

Agency Comments 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 22
 
 

 

APPENDIX ~ C 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 23
 
 

 

APPENDIX ~ C 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 24
 
 

 

APPENDIX ~ C 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 25
 
 

 

APPENDIX ~ C 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 26
 
 

 

APPENDIX ~ C 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 27
 
 

 

APPENDIX~C APPENDIX C APPENDIX ~ C APPENDIX ~ A Δ ACKNOWLEDGMENTS 

This report was prepared under the direction of Jodi Nudelman, 

Regional Inspector General for Evaluation and Inspections in the New 

York regional office, and Meridith Seife, Deputy Regional Inspector 

General. 

Miriam Anderson served as the team leader for this study. Other 

principal Office of Evaluation and Inspections staff from the New York 

regional office who contributed to this report include Taryn Eckstein 

and David Rudich. Other regional and central office staff who 

contributed include Kevin Farber, Vincent Greiber, Jennifer Jones, 

Sandy Khoury, Christine Moundas, and Michelle McInnis. 

OEI-02-06-00190 AVAILABILITY OF MEDICARE PART D DRUGS TO DUAL - ELIGIBLE NURSING H OME RESIDENTS 28