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Medicare Drug Program News
Detailed Explanation on Correcting Newest Medicare
Billing Errors Due Tomorrow
Two Senators want to know how Medicare and Social
Security are going to correct latest snafu impacting up to 500,000
senior citizens
 September
18, 2006 – While Medicare and Social Security are still wrestling to
recover $50 million that was mistakenly paid to senior citizens as
refunds of their Part D drug program premiums, the agencies have been
hit with another controversy over additional errors that have been made
in billing seniors for their premiums. Two powerful Senators have asked
for a detailed explanation by tomorrow.
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Medicare Tells
Seniors What to Do with Payments Mistakenly Sent by Agency
Some may have to
arrange bank transfers or get repayment plans
August 29, 2006 – If you are one of the 230,000 senior citizens that
received a check to reimburse you for your Medicare prescription drug
plan premiums, you have probably heard you should not cash the check. It
was a $50 million mistake by Medicare. The agency is, however, sending
you a letter telling you what to do with the check. Unfortunately, most
of the checks were direct deposited to the seniors bank account and
these people will have to call Medicare to arrange a transfer from their
bank, or work out a repayment plan. KaiserNet.org also reports today
that the drug plan "doughnut hole" is growing as a political issue.
Read more...
Medicare's
Nightmare $50 Million Mistake Draws Senator's, Advocates' Concerns
Medicare says senior citizens must
return the check but doesn't say how
August 24, 2006 – The fall-out continues over the mistaken reimbursement
by Medicare of $50 million to senior citizens paying for their Medicare
drug plan with a deduction for their Social Security check. Sen. Chuck
Grassley (R-Iowa), chairman of the powerful Senate Finance Committee,
sent a raising concern and several advocacy groups are complaining that
this adds further confusion for seniors to an already confusing program.
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Medicare Makes $50
Million Mistake by Refunding Drug Program Premiums
230,000 senior
citizens will have to repay the money
August 23, 2006 – The Medicare drug program, already under criticism for
being a confusing program for many senior citizens, has just become a
lot more confusing for 230,000 already in the program. The government
has mistakenly sent these seniors checks totaling about $50 million
supposedly reimbursing them for monthly premiums paid this year. The
checks come with a letter that says their monthly premiums will no
longer be deducted from their Social Security check – also an error.
Read more...
Read more
on
Medicare Drug Program
or
Medicare
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The Senators – Gordon H. Smith (R-OR), chairman of
the Senate Select Committee on Aging, and John D. (Jay) Rockefeller IV
(D-WV), ranking member of the subcommittee on Healthcare in the Senate
Finance Committee, sent a letter to the two agency heads demanding them
to clarify the errors and how they plan to correct them.
The agencies had admitted incorrectly billing
seniors and individuals with disabilities for their Medicare
prescription drug premiums.
Smith and Rockefeller expressed their concern in a
letter for the continued administrative errors that have resulted in
seniors living on fixed incomes being saddled with payment of several
months' worth of Medicare prescription drug premiums all in a single
month.
Many seniors who requested that their Medicare
premiums be deducted from their Social Security checks when they
enrolled have yet to see a reduction in their checks, according to
Smith's office. Consequently, they are not being billed, their premium
debt is mounting, and their prescription drug plans are not being paid.
Many seniors who switched to higher-cost
prescription drug plans are still having the lower premiums from their
original plan withheld. They too face mounting premium debt. In both
cases, the debt can be for as much as nine or ten months' worth of
premiums.
These premium withholding errors were among several
ongoing Center for Medicare and Medicaid Services (CMS) and Social
Security Administration (SSA) data exchange problems that were
highlighted last month when the two agencies provided incorrect
prescription drug premium refunds totaling $50 million to 231,000
Medicare participants.
It is estimated the billing errors now under
scrutiny involved up to 500,000 Medicare beneficiaries.
“It is unfair to ask seniors to bear the financial
burden of correcting a problem that occurred because of administrative
difficulties on the part of the government,” wrote Smith and
Rockefeller.
“There seems to be greater confusion—not
less—between your two agencies regarding what will actually happen to
seniors in these circumstances in October and November,” the letter
states.
Mark McClellan, administrator of the Centers for
Medicare and Medicaid Services, and Social Security Commissioner JoAnne
Barnhart, met with members of the Finance Committee to discuss these
problems. Their conflicting answers on how the problems are to be
solved, prompted the demands from the Senators.
"Unfortunately, there seems to be greater
confusion—not less—between your two agencies regarding what will
actually happen to seniors in these circumstances in October and
November," stated the letter from the two Senators.
"Commissioner Barnhart, you indicated that these
seniors will indeed be subjected to a lump-sum withhold during a single
check for these outstanding premiums.
"Dr. McClellan, you suggested that the Centers for
Medicare and Medicaid Services will not direct the Social Security
Administration to withhold more than three months’ worth of outstanding
premiums in one check. Instead, you suggested that seniors with
outstanding balances of more than three months will be enrolled in
direct bill and given the option to repay outstanding balances
incrementally.
"Even a three month withhold in a single check
could cause severe hardship for seniors living on fixed incomes. Given
that these two responses are inconsistent, we are requesting that you
provide written clarification of your agencies’ plans for assisting
seniors who are facing such unexpected financial commitments."
The letter to McClellan
and Barnhart is below.
September 11, 2006
Dr. Mark McClellan, Administrator
Centers for Medicare and Medicaid Services
Department of Health and Human Services
200 Independence Avenue, SW
Washington, DC 20201
Commissioner JoAnne Barnhart
Social Security Administration
8401 Security Boulevard
Baltimore, Maryland 21235
Dear Dr. McClellan and Commissioner Barnhart:
We are writing to follow-up on last week’s
Finance Committee Members’ meeting to discuss concerns related to
withholding prescription drug premiums from Medicare beneficiaries’
Social Security checks. While this meeting was informative, and we are
pleased to know that you are working to resolve most of the premium
withholding problems, there is an outstanding issue of significant
consequence that requires prompt resolution.
We specifically request that you provide us with
a detailed response regarding your agencies’ plans for handling the
premium withholds of seniors and individuals with disabilities who, by
no fault of their own, have several months of outstanding premium
underpayments.
As you both mentioned in the meeting, there are
four main premium withhold issues that have been encountered by your
agencies: 1) premium withholding not being stopped even though seniors
have changed to direct bill; 2) premiums not being withheld even though
seniors have requested such withholdings; 3) seniors who switch plans
and still have premiums from their original plans withheld and not the
premium amount for their new plans; and 4) the Part B premium not being
withheld accurately.
We are particularly concerned about seniors who
requested premium withholding, but have not seen a reduction in their
Social Security checks since they enrolled, and those who switched to
higher-cost prescription drug plans, but still have their original
plan’s premiums withheld.
In many cases, these premium errors have
persisted for several months, and in some cases as long as nine or ten
months.
We are extremely worried that, as you continue
the corrections process for the August/September claims processing
period, seniors in these circumstances will face a premium withholding
amount equal to several months’ premiums all in one month. A lump-sum
withhold such as this could severely harm those seniors who struggle to
make ends meet on a fixed income.
The highest prescription drug premiums in each of
our states are significant, especially for seniors living on a fixed
income. In West Virginia and Oregon, the highest premiums are
approximately $70 and $60 per month, respectively.
As you are aware, some seniors switched to these
higher-cost plans in order to receive coverage during the doughnut hole.
The difference in monthly premium amounts between the original plan and
the higher-cost second plan could be as high as $40-$60 per month.
Consequently, we have seniors in our states who
may face premium withhold amounts as high as $240-$480. Even more
troubling is the imminent withhold of several months’ premiums for those
seniors who have not changed plans, but as a result of processing
delays, have yet to have any premiums withheld from their checks.
We had hoped that a resolution to these two
problems would have been offered at Thursday’s meeting.
Unfortunately, there seems to be greater
confusion—not less—between your two agencies regarding what will
actually happen to seniors in these circumstances in October and
November.
Commissioner Barnhart, you indicated that these
seniors will indeed be subjected to a lump-sum withhold during a single
check for these outstanding premiums.
Dr. McClellan, you suggested that the Centers for
Medicare and Medicaid Services will not direct the Social Security
Administration to withhold more than three months’ worth of outstanding
premiums in one check. Instead, you suggested that seniors with
outstanding balances of more than three months will be enrolled in
direct bill and given the option to repay outstanding balances
incrementally.
Even a three month withhold in a single check
could cause severe hardship for seniors living on fixed incomes. Given
that these two responses are inconsistent, we are requesting that you
provide written clarification of your agencies’ plans for assisting
seniors who are facing such unexpected financial commitments.
We appreciate your prompt attention to this
request and ask that you respond no later than Tuesday, September 19. It
is unfair to ask seniors to bear the financial burden of correcting a
problem that occurred because of administrative difficulties on the part
of the government. We know that you share our interest in resolving this
matter quickly, and we look forward to your timely response.
Sincerely,
(This letter was signed by Senate Committee on
Aging Chairman Gordon H. Smith (R-OR) and Senator John D. (Jay)
Rockefeller IV (D-WV) Ranking member of the Senate Finance Committees
subcommittee on Healthcare.)
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