ConnPACE Pulled a Bait & Switch

speakout

–by John Bowman, Greenwich

There has been sparse reporting on the Governor’s cutting the ConnPACE prescription drug program for low-income seniors and disabled; the insidious bait & switch pulled on ConnPACE members has gone unnoticed by the press, possibly because you need to connect a lot of dots to understand it. Here goes.

ConnPACE provides (used to provide) wraparound coverage for low-income seniors’ prescription drugs; Medicare Part D is now the primary insurer, with ConnPACE paying for drugs not in their members’ plan’s formulary (list of drugs they cover) and paying co-pays down to $16.25/prescription (the co-pay that ConnPACE members pay at the checkout counter). ConnPACE also paid when members moved into their plan’s “donut hole.” Now, for any NEW drugs a member needs that are NOT in their Medicare Part D plan’s formulary, ConnPACE will not cover it either.

Medicare Part D plans all have different formularies and costs range from $15/month to $99/month with the more expensive plans covering more different drugs. Members can choose any plan they want, and ConnPACE pays the monthly premium (a federal requirement for state plans like ConnPACE).

Back in November, ConnPACE’s advisory letter to clients urged them to choose cheaper plans, saying in their letter, “As a guide to a cost-effective monthly premium, the Medicare Part D Connecticut regional benchmark premium for 2009 is $31.74. While ConnPACE will pay your Medicare Part D premium even if it exceeds the regional benchmark, you should always be aware of the cost to the state for that premium. If your current Medicare Part D premium is above $31.74, ConnPACE strongly encourages you to consider enrolling in a benchmark plan for 2009, as the benefits provided by all plans are comparable.”

ConnPACE in fact got the average plan cost down to about $20/month. They could ask and expect clients to choose the cheaper plans because, as they advised in the same letter, ConnPACE would cover non-formulary drugs.

But then, in mid-year, the switch. Had members known that ConnPACE would be or might be dropping new non-formulary drug coverage they, logically, would have chosen the best plan with the most drugs in its formulary. When asked about this, David Dearborn, CT DSS Communications Director simply said “In terms of the open enrollment timeframe of last November, the budget situation we now find ourselves in was not known at that point — in terms of lack of budget resolution as the deficits intensified.” Maybe true, although dropping coverage of non-formulary drugs has been in the Governor’s budget proposals for some time now. They certainly did know in May, however, that back in November they wrongly (as it turns out) encouraged ConnPACE members to choose cheaper plans. Based on that alone DSS should not have made this change.

There are fairer alternatives to deal with the budget difficulties. Using figures from the ConnPACE financials, found on their website, it looks like they could cover the cost of new, non-formulary prescriptions by raising the $16.25 co-pay by $2.60. This would spread the cost to all ConnPACE members, rather than making them all play Russian roulette and hoping they aren’t the ones who will need a new non-formulary drug and have to bear all the burden of this cost cut.

If a private insurer were doing this to its clients in Connecticut we would see AG Blumenthal on every TV station announcing his investigations and fines. Since it’s our own state, doing this to its most vulnerable citizens, we should all be screaming.

Note to municipalities and small businesses who might be joining up with Connecticut for health insurance: if they’d do this to low-income seniors and disabled, they would cut you’re plan’s coverage in a heartbeat. The State does not keep its promises.

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5 responses to “ConnPACE Pulled a Bait & Switch

  1. Thomas Hooker

    Medicare Part D plans all have different formularies and costs range from $15/month to $99/month with the more expensive plans covering more different drugs. Members can choose any plan they want, and ConnPACE pays the monthly premium (a federal requirement for state plans like ConnPACE).

    Sorry for my ignorance, but could you explain how this works in a bit more detail? Is ConnPACE a plan that tops up Medicare Part D? They simply cover “non-formulary” drugs and drug costs in the donut hole? And for that seniors pay $20 a month in addition to the average of $36 for Part D? Is that correct? And how much of their coverage have ConnPACE actually eliminated? Sorry I’m so confused on this.

  2. johningreenwich

    Sorry for my ignorance, but could you explain how this works in a bit more detail? Is ConnPACE a plan that tops up Medicare Part D? They simply cover “non-formulary” drugs and drug costs in the donut hole? And for that seniors pay $20 a month in addition to the average of $36 for Part D? Is that correct? And how much of their coverage have ConnPACE actually eliminated? Sorry I’m so confused on this.

    ConnPACE was established in 1996 to provide prescription drugs to low-income Connecticut seniors and disabled persons. Currently, if your income, including Social Security, is below $25,100 for singles or $33,800 for couples you are eligible for ConnPACE benefits (there are more details, but that’s the gist of it, there’s no asset test for regular ConnPACE. See http://www.connpace.com for more info).

    Seniors pay ConnPACE an annual application fee of $30 and get their prescriptions for a $16.25 co-pay per prescription filled, and they can only be filled one month at a time. This went on until 2005 when Medicare Part D prescription drug program started. That program was not as good as ConnPACE, but it covered all seniors regardless of income. At that time, CT passed and the Governor signed legislation to “hold harmless” seniors on ConnPACE – meaning they were not going to toss the ConnPACE members onto Medicare Part D and drop the program. So ConnPACE became the secondary insurer. Basically, ConnPACE members continued to get their prescriptions for $16.25 and Connecticut reduced its costs by collecting the benifit, if any, that the member got from a Medicare Part D plan – saving a significant amount for the State. ConnPACE pays the monthy cost of Medicare Part D plans directly to the insurers. If Medicare D’s co-pay was $50, ConnPACE paid the cost to members down to $16.25. If Medicare Part D didn’t cover a particular drug, ConnPACE did and it continued to cost the member only $16.25 (remember, Medicare Part D plans vary in the drugs they cover). Most of the Medicare Part D plans have a “donut hole.” That is, they cover drugs up to a certain level, then stop and the senior has to pay for all their drugs up to a new $ amount, where the Medicare Part D plan kicks in. For ConnPACE members who’s drug costs have brought them into the “donut hole,” ConnPACE continues to pay – in other words, ConnPACE members were “held harmless” from reduced coverage because of Medicare Part D rules.

    Hope this helps,
    John

  3. Thomas Hooker

    How much is this (dropping payment for non-formulary medicines) costing seniors? How much does Governor Rell expect to save the state by pushing the costs back on seniors?

  4. johningreenwich

    Good question. I left out the numbers for brevity but the savings isn’t much, unless of course you are a low income senior who needs a sepcial drug to stay alive, and that drug costs $10,000. Then the numbers are huge and devistating, but for the State, the amound saved by this move is small.

    According to the ConnPACE report for the period Jul-Dec 2008, ConnPACE spent $2.4 million on non-formulary drugs. That of course includes drugs that members are already taking and are already being covered by ConnPACE, so I estimate that 25% of the next month’s non-formulary drugs will be “new.” Coverage was only dropped for new prescriptions that are not part of members’ Part D formulary. So that’s 25% of 2.4 million or $600,000 for six months – $100,000 per month. According to the letter, this change was effective June 1 and would last at least until June 30th or whenever the new budget is passed, but may continue if the new budget does not have funding for non-formulary ConnPACE drug coverage.

    Now as time goes by, and members move out of the program and are replaced by new ones – an evolution sure to be speeded up as life-saving drugs are no longer covered – the cost will go up as the percentage of non-formulary drugs that are “new” increases up to the point where they’ve turned over 100% of the members (or their non-formulary prescriptions) and the cost then will be, based on the latest period reporting, $400,000/month.

    But even at $400,000/month the costs could be recoved through reasonable co-pays. If your raised the co-pay $10/prescription you cover the full cost of all non-formulary prescriptions. Not much when you consider that the average ConnPACE member gets 1.09 prescriptions per month. $10/month for the piece of mind that you won’t get sick and need a non-forumulary drug.

    That this wasn’t thought through is not surprising from the folks in Hartford who saw no problem in just mailing this to their senior and disabled members on May 26th to be effective June 1. That’s not how you communicate with senior citizens – more consideration and publicitiy was given to the possible closing of State parks. Shameful.

  5. johningreenwich

    I spoke to the Governor this morning about this – I’ve always wanted to say that, she did a call-in segment on WGCH. Anyway, she too wanted to cover the shortfall by raising the co-pay rather than cutting non-formulary coverage and she said that the democrats wouldn’t go for that and I should write Democrat legislators and tell them I’d rather see the co-pay raised than non-formulary drugs cut. Interesting that in the Greenwich Time House Speaker Christopher Donovan, D-Meriden, said the program has in the past been run on a deficit and Rell’s decision is further proof she is trying to address the fiscal crisis on the backs of the state’s neediest. “Why are we targeting these people?” Donovan said. “The Democrats want to cut the fat from the budget, not muscle or heart. This is heart. These are low-income people.”

    If the Governor and Speaker Donovan both don’t want this, I’d like to think they could get together and fix it.

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