Winter 2008

When Medicare Private Drug Plans Say “No”
By Robert M. Hayes
Aging Well
Vol. 1 No. 1

It’s January and Medicare’s Annual Coordinated Election Period, when people can change their Medicare drug coverage, just ended. While many think their coverage is a guarantee that they can get the drugs they need, older adults (and others) with Medicare private drug (Part D) plans—stand-alone drug insurance plans or coverage through Medicare private health plans—may be in for a surprise. Some of your clients could find their Part D plan that worked last year has altered its terms—covered drugs may have changed, new restrictions (prior authorization, quantity limits, step therapy) may have been imposed, or costs may have substantially increased. Someone new to a plan may encounter rules they weren’t aware of when they signed up.

But despite these obstacles, there are ways to help your clients when their drug plan says no. First, can they take another drug covered by the plan? Ask the client’s doctor if there’s an equally effective medication on the formulary that has no or minimal coverage restrictions for the prescribed dosage. Call the plan to verify.

Second, are your clients new to a Medicare private drug plan? New members are entitled to use its transition policy to immediately fill any prescription they had before their new coverage began. All drug plans are required to have this policy, which is available to new members during the first 90 days they are in the plan and entitles them to at least one 30-day supply of the denied drug(s). Tell your clients to ask for a transitional or temporary first fill. Remember, this is a one-time supply, so ensure your clients can get the drug for the rest of the year. If their doctor cannot prescribe another drug on the plan’s formulary, guide your clients through the appeals process.

Third, do your clients have both Medicare and Medicaid (dual eligibility)? If so, they are permitted to change plans every month. Help clients find one that better suits their needs. For more information on how to select a plan, visit Medicare Interactive (www.medicarerights.org/help.html), a Web-based counseling tool that offers consumer-friendly information about Medicare benefits, rights, and options.

Fourth, do your clients have full or partial Extra Help? In June 2007, the Centers for Medicare & Medicaid Services changed its guidelines to allow people who have the low-income subsidy (Extra Help) to change plans once per month. Again, visit Medicare Interactive for guidance.

Fifth, does your client qualify for a special enrollment period (SEP)? There are numerous ones that allow switching drug plans. For example, anyone who has lost employer drug coverage is eligible. A chart explaining SEPs can be found at www.medicarerights.org/sep_chart.pdf.

Appeals Process
If none of the above applies, your clients can appeal to get the medications they need. Here’s how it works:

Tell your clients to keep copies and records of everything they send at every level of appeal. Thorough documentation builds a strong case. Also, the client’s doctor is a critical ally. A successful appeal requires a clear statement of medical necessity from the prescribing doctor. Last, if your clients are paying out of pocket for medications during the appeals process, include a request for reimbursement as part of the appeal. It’s much easier than submitting a separate request.

As long as the medication in question isn’t excluded from Medicare coverage by law (e.g., a barbiturate), your clients can ask the plan for an exception and request a written coverage determination, which is necessary before the appeals process can begin. The prescribing doctor must write a statement, preferably on letterhead, explaining why the drug is medically necessary and that other drugs in the plan’s formulary won’t work or may actually harm the patient. Send the doctor a list of drugs on the formulary that are in the same class as the prescribed drug. Be aware that some doctors charge a fee when helping patients appeal a denial, so ask in advance.

Complete Medicare’s coverage determination request form available at www.cms.hhs.gov/MLNProducts/Downloads/Form_Exceptions_final.pdf and submit it with the doctor’s statement to the Part D plan. Submit as much supporting evidence as possible; it will make the case stronger. Use correct terminology.

If the plan classifies the request as a grievance, it won’t start the appeals process. Write explicitly, “I am requesting a coverage determination for Drug X.” Note that if your clients want to ask for a tiering exception (price reduction of a covered drug), preferred brand-name drugs and specialty drugs, usually in tiers two and four, are protected and cannot be reduced.

The plan has 72 hours from receipt of the request to respond. If the client’s “life, health, or ability to regain maximum function” is in jeopardy, a doctor can ask for an expedited request, which requires a response within 24 hours.

Level One
If the plan responds in writing that it has decided not to cover the drug, your client can request a redetermination. The plan will ask the doctor to further explain why the drug should be covered. The doctor should include as much substantial documentation as possible to show why no other drug or dosage would be as effective and/or that other drugs would be harmful.

Clients must make the request within 60 days of receiving denial. The plan has seven days to respond and 72 hours for an expedited review. If the plan decides to reverse its initial coverage determination, it must process the request within seven calendar days (72 hours for an expedited appeal) from the date it received the request. If the request involves payment, the plan must authorize it within seven calendar days and pay within 30.

Level Two
If your clients’ request for redetermination is declined by the plan, an independent review entity (IRE), or qualified independent contractor, can review the appeal and issue a reconsideration. The plan is required to provide the client with a Request for Reconsideration of Medicare Prescription Drug Denial form at the same time that it sends its adverse redetermination notice. The form will include instructions on how to appeal.

Clients must make the request within 60 days of receiving denial and should receive the IRE’s written reconsideration within seven days of receipt (72 hours if expedited). At this stage, it may help to have a lawyer involved in the case. The Medicare Rights Center has volunteers who can help at no charge.

Level Three
The next level of appeal is a hearing before an administrative law judge (ALJ), which can be pursued only if the amount in controversy is $110 or higher (the 2007 figure). Most ALJ hearings are done via teleconference. Your clients can add up the costs of multiple drugs or request coverage for one drug for an entire year in order to reach the minimum.

Clients must request a hearing within 60 days of denial. There’s no time limit for the ALJ to reach a decision. Clients whose health is in jeopardy may be forced to pay for their medications out of pocket or switch to a drug covered by the plan.

Still Further Appeal Rights
There are two even higher levels of appeal—the Medicare Appeals Council (MAC) followed by the federal court. An attorney is important by the time the appeal reaches these final stages.

If the IRE, ALJ, MAC, or federal court decides the plan must cover the drug, coverage must be processed within 72 hours (24 for an expedited appeal). If the case involves a reimbursement request, the plan must authorize it within 72 hours and pay within 30 calendar days. If your client wins, ask the plan to put in writing whether the decision is also effective the following year or if your client will need to appeal again.

Many people win appeals. Make sure your clients know they have this right and that you can help guide them through the appeals process.

— Robert Hayes is president of the Medicare Rights Center.