Tuesday, June 23, 2009

Implementation is going to be a problem...

The whirlwind healthcare reform debate of 2009 needs to review the implementation issues of the Medicare Part D program of 2006 in order to not repeat the mistakes of the recent past. The Medicare Prescription Drug Improvement and Modernization Act (MMA) is a relevant case study of the modern American government’s capability to manage a large and relatively quick shift in health policy. By analyzing the issues that cropped up in MMA, specifically administrative and outreach glitches in Medicare Part D implementation due to time constraints, the government will be better able to empirically assess the dynamics of a complete healthcare system overhaul.

The Congressionally mandated timetables did not give the Centers for Medicare and Medicaid Services (CMS) enough time to properly implement the new programming.
Medicare Part D was signed into law on December 8, 2003 and went into effect on January 1, 2006. During the interim time, CMS created the final regulations governing the entitlement program. CMS completed that preliminary task in January of 2005. Under the Congressionally mandated timetable, less than a year was left to educate all eligible seniors before enrollment began in November, 2005. State officials repeatedly warned the federal government that the enrollment of 6.4 million poor seniors would take more time because, among other issues, those seniors form one of the population subsets least likely to open their mail.

The fast growth of the actual Medicare bureaucracy also caused problems in the administration of the new programming. The CMS employee roster increased 11% in one year in order to accommodate the new policies. Before MMA, CMS had 4,500 employees. In order to administer the Medicare D drug benefit they hired 500 new employees. One of the most famous administrative problems that arose from these staff increases was the $50 million mistaken refund sent to 230,000 enrollees.

Health experts, members of Congress, and seniors all warned that a two year government turnaround would result in massive disruptions of existing drug coverage for poor seniors. There were calls from within Congress to slow the advent. A bill (H.R. 1382) was introduced by Jeff Flake (R-AZ) to delay the start of Medicare D by one year and continue with the Medicare drug discount card and subsidies to low income seniors during an extended education and implementation process. Our current House Speaker, Nancy Pelosi (D-CA), also called for an extension of the registration period. These calls went unanswered and there were major disruptions for elderly prescription drug coverage in January, 2006.

Back in 2003, Congressionally mandated timetables of implementation were too fast for the program to have time to gear up successfully and resulted in unnecessary administrative problems and failures to reach its intended audience. The current healthcare overhaul bills in Congress would create policy changes that would be implemented as soon as next year. This is clearly foolhardy based on Medicare D’s track record. Congress needs to realize that the problems associated with Medicare Part D, which only dealt with 10% of the US dollars spent on healthcare annually, will be magnified in a complete healthcare overhaul. Therefore, the federal government needs to allow more time and debate, not less, before passage and implementation.

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