From Dunkin Donuts To Krispy Kreme Making a

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From Dunkin Donuts…. To Krispy Kreme: Making a Bigger, Better Donut Hole Group IV

From Dunkin Donuts…. To Krispy Kreme: Making a Bigger, Better Donut Hole Group IV

National Mental Health Association, May 2005

National Mental Health Association, May 2005

Problem Statement • Structure of cost sharing under Part D negatively impacts quality •

Problem Statement • Structure of cost sharing under Part D negatively impacts quality • Dimensions of the problem – Vulnerable beneficiaries most affected – Patients less likely to fill prescriptions – Providers may not provide access to most effective drugs – Alternatively presents a moral hazard

Rationale • Experience with Part D – 25% of beneficiaries will experience higher costs

Rationale • Experience with Part D – 25% of beneficiaries will experience higher costs – 6. 9 million projected to reach coverage gap – 3. 1 million will reach catastrophic coverage – Near-poor (LIS-eligible) less likely to enroll – Duals confront copays for first time – Premiums lower and coverage better than projected

Rationale • Impact on Quality – Cost-related Adherence • Uninsured 2. 5 times more

Rationale • Impact on Quality – Cost-related Adherence • Uninsured 2. 5 times more likely not to fill prescription • 16. 4% of Medicare recipients did not fill scripts • 15. 2% of insured did not fill scripts

Rationale • Impact on Quality – Prescribing practices • Shoot-the-Moon • Under-prescribing

Rationale • Impact on Quality – Prescribing practices • Shoot-the-Moon • Under-prescribing

Stakeholders (1) • Who will support this plan? – Seniors – Disease-specific interest groups

Stakeholders (1) • Who will support this plan? – Seniors – Disease-specific interest groups • Who will oppose it? – Seniors with other credible coverage – Seniors without targeted chronic diseases – Other disease-specific interest groups – Working population paying Medicare tax

Stakeholders (2) • Other Supporting Stakeholders – Health care providers – AARP – Ph.

Stakeholders (2) • Other Supporting Stakeholders – Health care providers – AARP – Ph. RMA – Pharmaceutical companies – Capitated health care systems – Fiscal conservatives

Stakeholders (2) • Other Opposing Stakeholders – Some specialty health care providers – Some

Stakeholders (2) • Other Opposing Stakeholders – Some specialty health care providers – Some pharmaceutical companies – Fee-for-service health systems – Pharmacies

Plan of Action • Minimizing complications resulting from problematic access to drugs • Preserving

Plan of Action • Minimizing complications resulting from problematic access to drugs • Preserving cost; Improving quality

Plan of Action High complication chronic diseases • Highest evidence standards • Long-term cost

Plan of Action High complication chronic diseases • Highest evidence standards • Long-term cost savings for Medicare • Documented evidence of (examples): – Diabetes – Hypertension – Congestive Heart Failure • Establish independent advisory group

Plan of Action CDZ Drugs Other Drugs Deductible No ? Copays No ? Coverage

Plan of Action CDZ Drugs Other Drugs Deductible No ? Copays No ? Coverage Gap No Yes; Increased

Plan of Action Expand the Donut Hole Now Proposed $2, 250 $1, 750 $5,

Plan of Action Expand the Donut Hole Now Proposed $2, 250 $1, 750 $5, 100

Plan of Action High complication chronic diseases • Highest evidence standards • Long-term cost

Plan of Action High complication chronic diseases • Highest evidence standards • Long-term cost savings for Medicare • Documented evidence of (examples): – Diabetes – Hypertension – Congestive Heart Failure • Establish independent advisory group

Plan of Action • Financing Campaign – Disease-specific interest groups – Ph. ARMA –

Plan of Action • Financing Campaign – Disease-specific interest groups – Ph. ARMA – Capitated health systems • Budget Impact – Initial administrative component – Cost-neutral over 5 years – Cost-saving over 10 years to Medicare