Medicare Part D: Plan Sponsors' Processing and CMS Monitoring of Drug Coverage Requests Could Be Improved
Highlights
Under the Medicare Part D program, prescription drug coverage is provided through plans sponsored by private companies. Beneficiaries, their appointed representatives, or physicians can ask sponsors to cover prescriptions restricted under their plan--a process known as a coverage determination--and can appeal denials to the sponsor and the independent review entity (IRE). GAO was asked to review (1) the processes for sponsors' coverage determination decisions and the approval rates, (2) the processes for appealing coverage denials and the approval rates at the sponsor and IRE levels, and (3) the Centers for Medicare & Medicaid Services' (CMS) efforts to inform the public about sponsors' performance and oversee sponsors' processes. GAO visited seven sponsors that account for over half of Part D enrollment. GAO also interviewed and obtained data from CMS and IRE officials.
Recommendations
Recommendations for Executive Action
Agency Affected | Recommendation | Status |
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Centers for Medicare & Medicaid Services | To improve the Medicare Part D coverage determination and appeals processes, the Administrator of CMS should reduce the need for completed AOR forms by requiring sponsors and the IRE, upon receipt of standard appeal requests submitted by prescribing physicians without completed AOR forms, to telephone beneficiaries to determine whether they wish to initiate the appeal. |
Closed – Implemented
Reducing the Need for AOR Forms in the Medicare Part D Appeals Process. In January 2008, GAO reported on its review of the coverage determination and appeals processes under the Medicare Part D program--a voluntary outpatient drug benefit (GAO-08-47). We found that, for some standard appeals, missing Appointment of Representative (AOR) documentation contributed to delays in appeal decisions for plan sponsors in our study, and dismissals of Independent Review Entity (IRE) appeals. Some of the study sponsors had developed "workarounds" to eliminate the need for the completed AOR form for standard appeals. Prescribing physicians were allowed to file an expedited appeal on a beneficiary's behalf, without being his or her representative. In contrast, when filing standard appeals on a beneficiary's behalf prescribing physicians were required to submit a completed AOR form. GAO therefore recommended that the Centers for Medicare and Medicaid Services (CMS) reduce the need for completed AOR forms by requiring Part D plan sponsors and the IRE, upon receipt of standard appeal requests submitted by prescribing physicians without completed AOR forms, to telephone plan beneficiaries to determine whether they wished to initiate the appeal--thus eliminating the need for an AOR form. In response to our recommendation, CMS stated that it would review the current legal requirements for bringing an appeal to determine whether changes were appropriate and necessary to implement our recommendation. CMS also stated that it would work with physician's groups to ensure that physicians promptly submit any needed AOR forms. In May 2008, CMS proposed a change in its regulations and revised them in January 2009 to allow a prescribing physician to request a standard first-level appeal from a Part D plan on a beneficiary's behalf without being his or her representative. Beyond plan-level appeals, however, prescribing physicians must be designated the beneficiary's representative and continue to provide a signed AOR form due to the restriction on disclosure of personal health information to entities that would not otherwise have access to it, which includes the IRE. CMS's actions will help simplify the Part D appeals process so that there are fewer obstacles in the way of beneficiaries receiving the covered medications that they need in a timely manner.
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Centers for Medicare & Medicaid Services | To improve the Medicare Part D coverage determination and appeals processes, the Administrator of CMS should ensure that sponsor-reported data used for monitoring coverage determination and appeals activities are accurate and consistent by providing specific data definitions for each measure. |
Closed – Implemented
CMS officials reported providing specific data definitions for Part D coverage determination and appeals activities that Part D plan sponsors must report, effective for calendar year 2010 reporting. The agency's data descriptions for calendar year 2010 simplify the data elements to be reported for coverage determinations and appeals and consolidate areas where Part D plan sponsors were inconsistent, as reported by GAO. CMS officials also reported that they will establish data validation standards and procedures to help ensure that Part D plan sponsors' reported coverage determination and appeals data are valid, comparable, and complete.
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