CMS Should Waive Rx Benefit Late-Enrollment Penalty For Hurricane Victims, Louisiana Gov. Blanco Says

CMS should waive the late enrollment penalty for Medicare beneficiaries affected by Hurricane Rita who did not sign up for the Medicare prescription drug benefit by the May 15 deadline, Louisiana Gov. Kathleen Blanco (D) wrote in a recent letter to HHS Secretary Mike Leavitt, CQ HealthBeat reports (Reichard, CQ HealthBeat, 10/10). Beneficiaries who were eligible to enroll by May 15 who did not sign up will be charged a 1% increase in premiums for each month of delayed enrollment. Because the next enrollment period begins Nov. 15, beneficiaries would pay a minimum late-enrollment penalty of 7% (Kaiser Daily Health Policy Report, 5/17). Blanco said HHS on Aug. 15 said the enrollment period would be reopened indefinitely for residents of counties and parishes that received federal assistance because of damage from Rita -- which hit Louisiana and Texas in September 2005 -- and Wilma -- which hit Florida, Cuba and Mexico in October 2005. However, according to Blanco, CMS on Sept. 7 told Louisiana officials that parishes affected only by Rita would still have to pay the late-enrollment penalty. "Verbal assurances were made ... that these beneficiaries would have the penalty for late enrollment waived, as it has been for beneficiaries residing in Hurricane Katrina parishes and counties," Blanco wrote, adding that not waiving the penalty "certainly contributes to the impression that Hurricane Rita is the 'forgotten storm' and raises a question of comparability." She continues, "A lifetime penalty will be a disincentive [to enroll] for beneficiaries in these six parishes -- many who are still struggling to recover from the devastation of Hurricane Rita."

Advocacy Groups
In related news, the 60 Plus Association, an advocacy group for seniors, on Oct. 4 sent a letter to CMS Administrator Mark McClellan asking that the penalty be waived for beneficiaries in the six Louisiana parishes affected by Rita. Waiving the penalty would be "both cost-effective and compassionate," according to 60 Plus, which in the letter describes itself as the "conservative alternative to the AARP." Meanwhile, Ron Pollack, executive director of Families USA, on Oct. 6 sent a letter to Leavitt stating, "Under the law that allowed the use of demonstration authority to waive the penalty for Hurricane Katrina-impacted beneficiaries, the penalty also should be waived for Hurricane Rita-affected areas." CMS spokesperson Peter Ashkenaz said, "We're working with any beneficiary who's having difficulties based on their circumstances" (CQ HealthBeat, 10/10).

"Reprinted with permission from kaisernetwork. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at kaisernetwork/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork, a free service of The Henry J. Kaiser Family Foundation . © 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.