Simplified Medicare Drug Plan Is Expected

The Medicare prescription drug plan, which has confounded millions of seniors, will be simpler to navigate in the future, a top Bush administration official predicted Wednesday.

Health and Human Services Secretary Mike Leavitt said the number of private insurers offering the coverage was likely to drop, making it easier to compare coverage and pick a plan.

Although Leavitt did not give a reason, analysts said that a few large plans were attracting many of those eligible for the benefit, and that less successful insurers would probably drop out.

“I am convinced the marketplace is going to simplify the program,” he said. “My guess is we’ll find fewer [insurers] that are providing it.” In California, 47 such plans are offering coverage.

Leavitt’s forecast came as the administration released an upbeat enrollment report that some critics branded as misleading. However, many independent analysts agreed with his assessment that the number of drug plans would be winnowed down.

“I think, absolutely, there will not be nearly this volume of plans in the market,” said Lisa Chimento, director of the healthcare management practice at the Lewin Group, a Washington-area consulting firm.

Plans that survived would be likely to make their benefits easier to understand, she said. Many have retooled the standard benefit that Congress suggested, eliminating a $250 annual deductible and replacing coinsurance, which covers a percentage of the total drug cost, with a fixed co-payment for generic and brand-name drugs.

The new enrollment report showed that 1.3 million seniors signed up from Jan. 13 to Feb. 13, a period filled with national headlines about problems with the benefit’s introduction. Independent analysts did not challenge the monthly statistic, but some cast doubt on administration claims for total enrollment.

“The numbers are moving in the right direction,” said Tricia Neuman, director of the Medicare Policy Project at the Kaiser Family Foundation. “But enrollment is lower and slower than projected.”

According to a Kaiser analysis, the administration projected in January 2005 that 29 million seniors would sign up for the benefit during the enrollment period. Nearly 16 million have enrolled since Nov. 15; to meet that original goal, about 13 million would have to sign up by May 15.

That would require about 1 million new enrollees a week between now and the sign-up deadline. Leavitt said new weekly enrollments had been between 250,000 and 400,000.

However, the administration has recently been saying that about 10 million seniors whose drug coverage is provided by former employers should also be included in the tally. Though they were not included in the original goal of 29 million, officials say they count because Medicare is helping subsidize their coverage.

That calculation is “extraordinarily misleading,” said Ron Pollack, director of Families USA, a Washington advocacy group. He accused the administration of “moving the program’s goalposts.”

Many analysts say a majority of the people now in the program had coverage from private or public plans before they joined. Medicare officials say they do not know how many enrollees were previously paying out of pocket for their medications.

It appears that most enrollees signed up with large national insurers. Medicare has not released statistics on plan choices, but analysts say UnitedHealthcare and Humana lead the pack. UnitedHealthcare, which owns California-based PacifiCare, has forged a marketing alliance with AARP, the seniors group whose lobbying efforts helped secure passage of the benefit. Humana offers some of the lowest monthly premiums.

“It does seem as if the enrollment is going to two of the major players,” Chimento said. “One has what is seen by consumers as the right mix of price and formulary, and the other is seen as having a known and trusted name.”