A State Veterans Home Perspective On Medicare Part D

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A State Veterans Home Perspective OnMedicare
Part D
The National Association of State Veterans
Homes 2009 Summer Conference Ashville, North
Carolina
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• Todays Presenters
• Fred S. Sganga, FACHE
• Executive Director
• Joseph Lapietra
• Deputy Executive Director
• Pat D. Rocco, Jr.
• Chief Finance Officer
• Richard Smith, RPh, CGP
• Director of Pharmacy

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• Todays Discussion
• About the Long Island State Veterans Home
• Legislative History
• The Benefit The Basics
• Our Decision Process
• Obstacles To Confront
• Dealing With PDPs
• The LISVH Experience
• Things To Watch Out For

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• 350 Bed Skilled Nursing Facility
• 40 Slot Adult Day Health Care
• Located on academic campus of
• Stony Brook University
• Stony Brook, New York

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• Statistics
• 99.6 Average occupancy rate
• 250 New admissions per year
• 285 Hospital admissions per year
• 43,000 Rxs per year
• 3,225,505 Medication doses administered per year

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• Legislative History of Medicare Part D
• Passed by Congress in November 2003.
• Signed into law by President Bush on December 9,
  2003.
• Program begins January 1, 2006.
• Initial 10 year estimated cost 395 Billion.
• Pres. Bush calls it The greatest advance in
  health care since Medicare was founded in 1965.

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• What is Medicare Part D?
• Part D is voluntary.
• Like the rest of Medicare, Part D is a
  fee-for-service program.
• However, unlike the rest of Medicare, Part D is
  not run by the Federal Government.
• Beneficiaries sign up with individual private
  insurance companies through
• Prescription Drug Plans (PDPs)
• Medicare Advantage Health Plans

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• Medicare Part D Drug Benefit The Basics
• Annual enrollment periods
• November 15 to December 31
• 2009 Deductable 295
• Premiums Est. 32/month in 2009
• Those who dont enroll initially, or who dont
  maintain continuous coverage, 1 penalty for
  every month eligible for life.

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• Administration of
• Medicare Part D Benefit
• The Part D benefit administered primarily by
  private plans
• Prescription Drug Plans (PDPs)
• Medicare Advantage Prescription Drug plans
  (MA-PDs)
• Patients drugs MUST be in the PDP formulary.
• Plans vary by region.
• HHS is PROHIBITED from controlling or negotiating
  prices for PDPs MA-PDs.

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• Dual Eligibles
• Dual Eligibles are persons who are both eligible
  for Medicare and Medicaid.
• 6.4 million Medicaid low-income beneficiaries
  were switched into Medicare for their drugs.
• Dual Eligibles who are residents of skilled
  nursing facilities have
• Co-pay 0
• Doughnut Hole None
• Catastrophic 0 co-pay

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• SNF Private Pays Part D
• Premium Ranges from 18/mo to 95/mo
• Deductible 295
• Co-payments Varies by plan formulary
• Doughnut Hole Kicks in at 2,510
• Private Pay responsible for next 3,217
  out-of-pocket.
• Catastrophic Kicks in after 3,217 of
  out-of-pocket.
• There are no co-pays at this level.
• For SNF residents it will usually kick in around
  3rd quarter of calendar year.

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• Decision Process For LISVH
• Had an established in-house pharmacy.
• Spending 1 million/year on drugs.
• Medicaid was reimbursing us approximately 3.50
  per resident day (383,250/yr).
• A No Brainer For Us!!!!

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• Obstacles To Confront
• Did we have the right staffing?
• Finding the right software for LTC Pharmacies!
• Enrollment of residents into PDPs (Part D
  Prescription Drug Plans).

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• Obstacles To Confront
• Communication to families.
• Establishing pharmacy contracts with PDPs.
• Finding a GPO (group purchasing organization)
  partner to help with contracts.

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Did We Have The Right Staffing?

• Total increase of 1.3 FTEs
• - New relationship with the business office!!!
  (No new staffing in business office)

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• Finding the Right Software
• We felt that our vendor (ADL) had an inadequate
  pharmacy system, which lacked billing
  capabilities.
• We purchased QS1 Pharmacy Primecare Software and
  operate it independently from ADL.
• No additional hardware costs (zero!).

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• Enrollment of Residents
• Mass confusion among residents families.
• CMS auto-assigned most of our dual eligible
  (Medicare/Medicaid) residents into a benchmark
  PDP.
• Caution This is an annual event!!!
• 75 of dual population autoassigned
• 13 different benchmark PDPs
• Dual eligible residents are permitted to change
  their PDP every month!

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• Enrollment of Residents
• Non Dual Eligible Re-Enrollment occurs yearly.
• Between Nov. 15th Dec. 31st
• CMS discouraged facilities from steering
  residents to individual PDPs.
• Non Dual Eligibles needed a lot of hand holding!

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• Communication to Families
• Tough to explain this new plan.
• Written communication had to be simple.
• Utilized all forms of communication education
• Direct mail
• Resident Family Council
• Special Meetings

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• Dealing with the PDPs
• An Overwhelming Dilemma
• In the Beginning (2006)
• 484 Different PDPs
• As of 2009
• 308 Different PDPs

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• Establishing Pharmacy Contracts
• Sorting out the competition
• Formulary Reviews
• Geographic Restrictions
• Varying Reimbursement
• Paperwork, Paperwork More Paperwork!!!
• Average contract was 45 pages.
• Finding a GPO (group purchasing organization) to
  assist was key to streamlining the process.

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• GPO Partner
• We chose to go with Innovatix.
• New York City based GPO that serves the Long Term
  Care market - NATIONWIDE.
• Initial membership was FREE.
• Held our hand throughout the process including
  negotiating favorable contracts.
• LISVH current annual cost is 2,700 per annum for
  claims processing contract maintenance.

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• PDPs Were Not Designed For Long Term Care
  Residents
• WHY??
• Does not take the following into account
• Administration forms of medication
• Intramuscular (IM) injection
• Intravenous (IV)
• Distribution systems
• Unit dose packaging
• STAT Orders
• The immediate need for meds with certain
  residents. (Non formulary issue)
• Laws that restricted whole drug groups.
• Benzodiazepines (Ativan, Valium, Xanax)
• Vitamins (Folic Acid)

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• Advantage 1 for SNF
• with In-house Pharmacy
• Medicare Part D pays an average dispensing fee of
  4.50 per Rx.
• LISVH employs 5 physician and 2 physician
  assistants that prescribed over 43,000 Rxs in
  2008.
• Thats 198,000 to the bottom line!!!

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• Advantage 2 for SNF
• with In-house Pharmacy
• SVHs purchase drugs off the VA contract.
• PDPs reimbursement to SVHs equals AWP minus
  (14 -18), depending on the contract.
• AWP Avg. Wholesale Price
• PDP reimbursement always exceeds cost of the
  drugs!!

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• Medicare Part D - The LISVH Experience

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• Going with an
• In-House Pharmacy!!!
• Win - Win - Win

Health Care Team
Facility
Resident
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• Resident Wins
• Receives more nursing care, as less time spent by
  nursing on para-pharmaceutical duties.
• Receives timely implementation of MDs orders.
• Safety of Therapy
• Prospective as well as retrospective review of
  medication therapy by onsite pharmacist.

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• Facility Wins
• Enhanced revenue stream.
• Use as a promotional opportunity.
• Market your enhanced services over other skilled
  nursing facilities.
• Improves recruitment retention of nurses and
  other clinical staff.

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• Health Care Team Wins
• Pharmacist participation as member of
• Comprehensive Care Plan Team
• Falls Committee
• Infection Control
• P T Medication Safety
• Morning Meeting - Resident Report
• Pharmacist as a RESOURCE for residents, nurses,
  physicians, and all members of the health care
  team.

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• Things To Watch Out For
• Fate of 70 Service Connected Disabled Veterans.
• Medication Therapy Management Is Coming!
• Could bring additional dollars ?
• Pharmacists can bill for services
• Merging PDPs
• Good for us
• Less Confusion
• The Impact of Obama Health Care???

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Conclusion

• The pursuit of the Medicare Part D Program for
  your State Veterans Home can be a worthwhile
  endeavor, especially in the tightening economic
  climate we face today.
• We strongly believe that implementation of an
  in-house pharmacy has multiple advantages for the
  veterans you care for each and every day!

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• Additional Information on the Web
• www.medicare.gov
• www.cms.hhs.gov
• www.socialsecurity.gov
• www.innovatix.com

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Thank You.

• Fred S. Sganga, FACHE
• Executive Director
• Joseph Lapietra
• Deputy Executive Director
• Pat D. Rocco, Jr.
• Chief Finance Officer
• Richard Smith, RPh, CGP
• Director of Pharmacy

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AnyQuestions??