Stumbling Start For Drug Program Sparks Congressional Debate

Congress is split on whether to step into the fray of a dispute between states and the federal government over reimbursement of the Medicare prescription drug program that many say got off to a flailing start at the beginning of this year.

Millions of America's seniors signed up for the new prescription drug benefit, but when computer glitches prevented entitlement payouts, at least 26 states passed emergency laws to pay for drugs so seniors would not have to do without.

Some advocates say Congress is to blame for the confusion because the drug benefit law was poorly written.

"I think Congress could have made … this a smoother process," said Trish Nemore, senior policy attorney for the Center for Medicare Advocacy in Washington, D.C. "I think it's primarily Congress' fault."

Other analysts have blamed the Bush administration for poorly executing the new law while still others say private insurance plans involved in providing the drug coverage to seniors caused the problems.

"I really think the challenge here is with the insurance plans. Some of the plans weren’t as prepared as they should have been," said Susan Winckler, spokeswoman for the American Association of Pharmacists, adding that all the parties need to work together to get the process moving in the right direction. "Let's make sure the plans are prepared to pay."

An estimated 24 million people are now enrolled in the landmark Medicare prescription drug plan, which was passed as part of the Medicare Prescription Drug Improvement and Modernization Act of 2003. Of that number, nearly 7 million recipients are low-income seniors, many of whom were rolled into the new Medicare drug plan from their state-run Medicaid plans.

That dual enrollment has been blamed for part of the problems. Low-income seniors have been the hardest hit from the rough transition at the beginning of the year, according to state-by-state reports. Many have been turned away because their names aren't on file with one of the more than 40 coverage options offered through the new drug program. Some have been slapped with undue co-pays.

"This is simply unacceptable and clearly not what we intended," said Sen. Elizabeth Dole, R-N.C., in a Thursday hearing of the Senate Special Committee on Aging, which heard from administration officials on how efforts were going to contain and reconcile the problems since the Jan. 1 launch.

Part of the problems has also been the result of the popularity of the program. A computer glut caused by millions of seniors enrolling right before the January launch contributed to the headaches over the last several weeks, government officials said.

"When there's change, there's an opportunity for things to go wrong," Health and Human Services Secretary Mike Leavitt told reporters last month as reports materialized that more states had to step in to fill the gaps. "We are fixing them one pharmacy, one beneficiary at a time."

Centers for Medicare and Medicaid Services Administrator Mark McClellan told the Senate committee on Thursday that a number of corrections are being made to ease the problems, including extending the transition period 60 days to ensure that no individual is denied their new benefits.

CMS is also working with the insurance plans and pharmacies, and putting forth a reimbursement program for states that have paid for the program's shortfalls in the meantime, he said.

"We make no excuses for these problems," McClellan said.

Despite the mess, Republicans at Thursday's hearing noted that the program is successfully filling approximately 1 million prescriptions every day. Some states and individuals have also stepped up to protect seniors while problems are being sorted.

According to the American Association of Pharmacists, in some cases, pharmacists have taken out lines of credit to pay for their regular customers' drugs out of their own pockets until the confusion is cleared up.

In California, Republican Gov. Arnold Schwarzenegger recently signed legislation that would allow the government to pay the drug bills for seniors who fell through the cracks. According to the governor's office, 20 percent of the eligible people under the plan in California were adversely affected and the state has already paid for at least 77,514 prescriptions under the emergency plan.

Maryland's Department of Health and Mental Hygiene is still gathering information, awaiting final details of recoverable costs and calculating expenses, but officials there are planning to ask the federal government to reimburse approximately $1 million to the state. MDHMH has assisted 1,600 confused callers and refilled more than 90 emergency prescriptions since the Jan. 1 start of the program.

"Administrative costs are the bulk of what the state of Maryland is going to be requesting," said Jeff Gruel, director of the Maryland Pharmacy Program.

While the administration and Republican-led Congress catch most of the blame for the foul-ups, Democrats see an opportunity to draw distinctions from themselves in a heated midterm election year.

Sen. Hillary Clinton, D-N.Y., who has introduced legislation with Sen. John Rockefeller, R-W.Va., to ensure that states are reimbursed, blasted the administration during Thursday's hearing, saying she felt the whole program should be tossed out and redesigned.

"It is an absolute embarrassment," Clinton said. "I for one believe we should scrap this and start over."

Jennifer Crider, spokeswoman for House Minority Leader Nancy Pelosi, D-Calif., suggested that the party will use the transition problems on the campaign trail.

"The amount of confusion among seniors is really, really enormous and it's bad for families across the board," Crider said.

Crider said the Republican House rammed the legislation through in November 2003 with little regard for Democratic recommendations for lowering drug costs and protecting seniors.

"Had we worked in a bipartisan way to begin with, we wouldn't be in the place we are in today," she added.

Senate Minority Leader Harry Reid, D-Nev., echoed her sentiments. "Democrats warned that we would need to take action and protect seniors, but Republicans and the Bush administration time and time again said no."

But Republicans are now offering a warning of their own. They say Democrats shouldn't try to play politics with the program.

"We must work together and not point fingers to solve these problems," said Dole, who decried "unproductive rhetoric and the blame game."

Responding to Clinton's remarks, Sen. Rick Santorum, R-Pa., said Congress "should not be flippant in casting out babies with the bathwater."

"Yeah, there are Democrats who are trying to make this a political issue and that is saddening, because this [prescription drug program] is something that is working for the majority of America's seniors," said one Republican Senate aide. "We can't play politics while trying to solve this problem."

Congress voted on party lines for the prescription drug plan two years ago, but bipartisan measures are now popping up to reimburse the states for their trouble and to fix the problems. Supporters of legislative remedies though say the onus should not be on the states to recoup the money from the plans themselves.

"New Hampshire was one of the states that went into the breach and really prevented a number of medical emergencies, and I want them to be reimbursed," said Rep. Jeb Bradley, R-N.H., who introduced legislation for state reimbursement on Feb. 1.

Bradley, who voted for the program in 2003, dismissed claims that Congress is to blame for the transition problems.

"[The drug program] is designed now to ensure there is competition, and through the forces of the market, it's going to offer lower costs for prescriptions without price controls," he said. "Unfortunately, the [transition] is a problem, but hopefully it is a temporary problem."

Winckler of the American Association of Pharmacists said the problems have been widespread and are far from over, but she does not know if legislation is the best remedy right now.

Many proposed fixes will meet resistance from powerful Republicans who say legislative remedies are not the cure, particularly since the law already allows for reimbursement to come straight from insurance plans to the states. They add that CMS has indicated that it is already helping the process along.

"It's unclear whether any legislation is needed. Let's focus on administrative remedies now because they'll deliver help a lot faster than any legislation," said Sen. Chuck Grassley, R-Iowa, chairman of the Senate Finance Committee, which oversees the Medicare plan. His committee will hold a hearing on Wednesday to address the issue. McClellan will also testify there.

"My bigger concern is getting prescriptions to the people who need them," Grassley said.

Senate Majority Leader Bill Frist, R-Tenn., who controls the agenda in the Senate, agrees and does not plan to support any legislation at this time, a staff aide said. House Speaker Dennis Hastert's office did not return calls for comment.

Capital News Service's Elissa Petruzzi contributed to this report.