The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 was enacted in November 2003 and became effective on January 1, 2006. Two major changes occurred. A prescription drug benefit is now available for seniors and younger persons with disabilities who are covered by Medicare.
How has Medicare changed the role of prescription drugs in care?
In the years since Medicare's creation in 1965, the role of prescription drugs in patient care has significantly increased. As new and expensive drugs have come into use, patients, particularly senior citizens at whom Medicare was targeted, have found prescriptions harder to afford.
When did Medicare add outpatient prescription drug benefits?
The next opportunity to add an outpatient prescription drug benefit in the Medicare program came in 1993 as part of the health security act proposed by President Bill Clinton (D).
How many summaries are there for the Medicare Prescription Drug Improvement Act?
There are 3 summaries for H.R.1. Bill summaries are authored by CRS. Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Title I: Medicare Prescription Drug Benefit (Sec. 101) Amends title XVIII (Medicare) of the Social Security Act (SSA) to add a new part D (Voluntary Prescription Drug Benefit Program).
When was the Medicare Prescription Drug Act passed?
Legislative history. Introduced in the House as Medicare Prescription Drug and Modernization Act of 2003 by Representative Dennis J. Hastert on June 25, 2003. Passed the House on June 27, 2003 (216 - 215, 1 Present) Passed the Senate on July 7, 2003 (Unanimous Consent)
What did the MMA 2003 do?
The 2003 Medicare Modernization Act (MMA) is considered one of the biggest overhauls of the Medicare program. It established prescription drug coverage and the modern Medicare Advantage program, among other provisions. It also created premium adjustments for low-income and wealthy beneficiaries.
What did the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 do?
Today the President signed into law the historic Medicare Prescription Drug, Improvement, and Modernization Act of 2003, which will help to create a modern Medicare system, allow for the biggest improvements in senior health care in nearly 40 years, and provide seniors with prescription drug benefits and more choices ...
When did Medicare add prescription drug coverage?
January 1, 2006Medicare did not cover outpatient prescription drugs until January 1, 2006, when it implemented the Medicare Part D prescription drug benefit, authorized by Congress under the “Medicare Prescription Drug, Improvement, and Modernization Act of 2003.”[1] This Act is generally known as the “MMA.”
What does MMA stand for in Medicare?
The Medicare Modernization Act (MMA) included three polices to limit the financial. risks that Part D prescription drug plans (PDPs) must bear.
What was the purpose of the prescription drug Marketing Act of 1987?
Prescription Drug Marketing Act of 1987 - Amends the Federal Food, Drug, and Cosmetic Act to permit only the U.S. manufacturer of a drug to reimport such drug into the United States, except for emergency medical care. Prohibits the selling, purchasing, or trading of prescription drug samples or coupons.
Which was created by the Medicare prescription drug plan?
Medicare Part D, also called the Medicare prescription drug benefit, is an optional United States federal-government program to help Medicare beneficiaries pay for self-administered prescription drugs. Part D was enacted as part of the Medicare Modernization Act of 2003 and went into effect on January 1, 2006.
What was the impact of the Medicare prescription drug Improvement and Modernization Act?
Summary: Implementation of MMA has affected the entire healthcare continuum by reducing pharmaceutical reimbursement rates and health system revenues and increasing prescription drug copayments, emergency department visits, and hospital admissions.
Which Medicare plan covers prescription medications quizlet?
Medicare Part D help cover the cost of prescription drugs, is run by medicare approved insurance companies, may help lower prescription drug costs, and may protect against higher costs in the future.
What part of Medicare covers prescription drugs?
Part Dhealth coverage Medicare drug coverage (Part D) helps you pay for both brand-name and generic drugs. Medicare drug plans are offered by insurance companies and other private companies approved by Medicare.
Who created Irmaa?
IRMAA was created in 2003 through the Medicare Modernization Act of 2003 as it was a way, according to the Act, for Congress and the people “to begin to address the fiscal challenges facing the Medicare program”.
What are MMA files?
The Master Album Maker Photo Album File is stored in the MMA format and is affixed with MMA extension and is used by Mouse's Master Album Maker software. These MMA files are generally classified as data files that contain multiple images and their display properties consolidated in a digital photo album.
How many seniors are on Medicare Part D?
At the time, the new law was the first major change to Medicare in nearly 40 years. Today, more than 35 million seniors rely on Part D benefits, including 11 million low-income seniors at or near poverty.
How many Medicare beneficiaries opted for Part D?
Did this change after Part D passed? According to the Congressional Budget Office (CBO), 53 percent of Medicare beneficiaries opted to enroll in a Part D drug plan during the first six months of its roll-out, including two-thirds of seniors who lacked drug coverage before.
How much is the deductible for Medicare for seniors in 2014?
Under the “ standard benefit ” for 2014, seniors pay a $310 deductible in addition to their monthly premiums and 25 percent of drug costs (“coinsurance”) until their total spending reaches $2,850. After this amount, seniors face a gap in coverage (the “donut hole”) where they must pay more until total out-of-pocket spending reaches $4,550.
How much did Medicare cost in 2012?
Actual program costs, however, have run about 30 percent lower than projected. In 2012, federal spending on Part D was $62.5 billion. Experts say several factors account for these lower costs, including the competitive, market-based design of Part D, ...
What is preferred pharmacy network?
Recently, the Centers for Medicare and Medicaid Services (CMS) contemplated new rules that would have limited the ability of private insurers to manage which pharmacies can participate in their networks (so called “preferred pharmacy networks”) – a strategy that plans use to help control costs.
Where do seniors get Part D?
Seniors get Part D coverage from private plans approved by the government . Some seniors receive Part D coverage through retiree plans offered by their former employers, while others choose a plan from the “ marketplace ” run by Medicare.gov (if this sounds similar to the “exchanges” under Obamacare, it is).
Is Medicare Part D a phase out?
In the meantime, Part D has become an increasingly important element of Medicare. The Affordable Care Act (“Obamacare”) included a significant expansion of Part D – a phase-out of the “donut hole.”.
When did Medicare Advantage start?
Medicare Advantage plans. With the passage of the Balanced Budget Act of 1997, Medicare beneficiaries were given the option to receive their Medicare benefits through private health insurance plans, instead of through the Original Medicare plan (Parts A and B).
When was Medicare Modernization Act enacted?
Signed into law by President George W. Bush on December 8, 2003. The Medicare Prescription Drug, Improvement, and Modernization Act, also called the Medicare Modernization Act or MMA, is a federal law of the United States, enacted in 2003. It produced the largest overhaul of Medicare in the public health program's 38-year history.
What is Medicare Part D?
Main article: Medicare Part D. The MMA's most touted feature is the introduction of an entitlement benefit for prescription drugs, through tax breaks and subsidies. In the years since Medicare's creation in 1965, the role of prescription drugs in patient care has significantly increased.
How many Americans were enrolled in HSAs in the first 10 years?
After the first 10 years over 12 million Americans were enrolled in HSAs (AHIP;EBRI).
How much did the stimulus program cost in 2015?
One month after passage, the administration estimated that the net cost of the program over the period between 2006 (the first year the program started paying benefits) and 2015 would be $534 billion. As of February 2009, the projected net cost of the program over the 2006 to 2015 period was $549.2 billion.
Can formularies be used to restrict prescription drug choices?
formularies can be used to restrict prescription drug choices. prescription coverage can be deferred to the patient or a Medicare Part D prescription plan. care other than emergency care can be restricted to a particular region. federal reimbursement can be adjusted according to the health risk of the enrollees.
Who was the chief architect of Medicare?
According to the New York Times December 17, 2004 editorial W.J."Billy" Tauzin, the Louisiana Republican who chaired the Energy and Commerce Committee from 2001 until February 4, 2004 was one of the chief architects of the new Medicare law. In 2004 Tauzin was appointed as chief lobbyist for the Pharmaceutical Research and Manufacturers of America (PhRMA), the trade association and lobby group for the drug industry with a "rumored salary of $2 million a year," drawing criticism from Public Citizen, the consumer advocacy group. They claimed that Tauzin "may have been negotiating for the lobbying job while writing the Medicare legislation." Tauzin was responsible for including a provision that prohibited Medicare from negotiating prices with drug companies.
Who raised the issue of prescription drug coverage in Medicare?
When the proposal was finalized at a meeting of the president, HEW secretary Eliot Richardson, and Assistant Secretary for Planning and Evaluation Lewis Butler, the issue of prescription drug coverage in Medicare was raised at the request of Commissioner of Social Security Robert Ball.
How many prescriptions were there in 1950?
The number of prescriptions had climbed from 363 million in 1950 to 833 million in 1965 to 930 million in 1967. The number of prescriptions per capita had almost doubled from 2.40 to 4.75, and expenditures had risen from $736 million in 1950 to $3.25 billion in 1967.
How many Medicare beneficiaries will have private prescription coverage?
At that time, more than 40 million beneficiaries will have the following options: (1) they may keep any private prescription drug coverage they currently have; (2) they may enroll in a new, freestanding prescription drug plan; or (3) they may obtain drug coverage by enrolling in a Medicare managed care plan.
How much does Medicare pay for Part D?
The standard Part D benefits would have an estimated initial premium of $35 per month and a $250 annual deductible. Medicare would pay 75 percent of annual expenses between $250 and $2,250 for approved prescription drugs, nothing for expenses between $2,250 and $5,100, and 95 percent of expenses above $5,100.
What was the Task Force on Prescription Drugs?
Department of Health, Education and Welfare (HEW; later renamed Health and Human Services) and the White House.
What was the Byrnes bill?
The counterproposal offered by Republicans, the Byrnes bill, called for voluntary enrollment in a health insurance program financed by premiums paid by the beneficiaries and subsidized by general revenues. It had more benefits, including physician services and prescription drugs.
How much did Medicare cut in 1997?
Nonetheless, reducing the budget deficit remained a high political priority, and two years later, the Balanced Budget Act of 1997 (Balanced Budget Act) cut projected Medicare spending by $115 billion over five years and by $385 billion over ten years (Etheredge 1998; Oberlander 2003, 177–83).
Background
The Medicare program was enacted in 1965 to provide subsidized health coverage for the elderly and disabled. The program initially covered hospital stays (Part A) and physician office visits (Part B), and Medicare paid for the prescription drugs used in those settings.
Part D: What You Need To Know
The Medicare Part D prescription drug benefit includes several features that distinguish it from other public and private models of prescription drug coverage.
Key Questions For Drug Pricing
There are several outstanding questions about how the Part D program could be improved to control drug costs or lower beneficiary spending.
Key Terms
"Noninterference" clause: A provision in the Medicare Modernization Act states that the Department of Health and Human Services "may not interfere with the negotiations between drug manufacturers and pharmacies and Prescription Drug Plan sponsors; and may not require a particular formulary or institute a price structure for the reimbursement of covered Part D drugs.".
About Health Policy Briefs
Health Policy Briefs are produced under a partnership of Health Affairs with the generous support of the Commonwealth Fund and Memorial Sloan Kettering Cancer Center. Text highlighted in blue is hyperlinked to outside sources in the online version of this brief.
Overview
- In 2003, Congress passed legislation to create a prescription drug benefit for seniors in Medicare – Medicare “Part D.” At the time, the new law was the first major changeto Medicare in nearly 40 years. Today, more than 35 million seniors rely on Part D benefits, including 11 million low-income seniors at or near poverty.
Why Did Congress Pass Medicare Part D?
- Before the creation of Part D, Medicare covered hospital costs (Part A) and doctor visits (Part B), but not prescription drugs. In 2003, the Kaiser Family Foundation reported that seniors were spending an average of $2,318 in out-of-pocket drug costs and that one-third of seriously ill seniors without drug coverage were skipping doses to make their prescriptions last longer. Anot…
Did This Change After Part D passed?
- According to the Congressional Budget Office (CBO), 53 percent of Medicare beneficiaries opted to enroll in a Part D drug plan during the first six months of its roll-out, including two-thirds of seniors who lacked drug coverage before. The non-partisan Medicare Payment Advisory Commission (MedPAC) credits Part D with increasing the share of seniors who have prescriptio…
Impacts of Medicare Part D
- Seniors get Part D coverage from private plans approved by the government. Some seniors receive Part D coverage through retiree plans offered by their former employers, while others choose a plan from the “marketplace” run by Medicare.gov (if this sounds similar to the “exchanges” under Obamacare, it is). Low-income seniors eligible for subsidies to help buy cover…
How Does Part D Work?
- In 2013, seniors could choose from an average of 35 plans, including those that are part of so-called “Medicare Advantage” plans (see “Medicare Advantage: Medicare’s Private Option”). According to MedPAC’s 2014 report, monthly premiums averaged about $30 in 2013. Under the “standard benefit” for 2014, seniors pay a $310 deductible in addition to their monthly premium…
How Much Does This Program Cost?
- CBO originally predicted that Medicare Part D would cost $407 billion from 2004-2013. Actual program costs, however, have run about 30 percent lowerthan projected. In 2012, federal spending on Part D was $62.5 billion. Experts say several factors account for these lower costs, including the competitive, market-based design of Part D, but also the greater use of generic me…
What’s The Future of Part D?
- Despite these results, cost control remains a concern as the Baby Boomers retire and demands for coverage increase. Recently, the Centers for Medicare and Medicaid Services (CMS) contemplated new rules that would have limited the ability of private insurers to manage which pharmacies can participate in their networks (so called “preferred pharmacy networks”) – a strat…
Key Facts
- Medicare Part D offers prescription drug coverage to more than 35 million seniors, 11 million of whom are low-income.
- Before the passage of Part D, seniors spent an average of $2,318 on out-of-pocket drug costs.
- About 90 percent of Medicare-eligible seniors now have prescription drug coverage. Enrollees in Part D pay an average of $30 a month in premiums.
- Medicare Part D offers prescription drug coverage to more than 35 million seniors, 11 million of whom are low-income.
- Before the passage of Part D, seniors spent an average of $2,318 on out-of-pocket drug costs.
- About 90 percent of Medicare-eligible seniors now have prescription drug coverage. Enrollees in Part D pay an average of $30 a month in premiums.
- Federal spending on Medicare totaled $62.5 billion in 2012, or about 10 percent of total Medicare spending. So far, Part D has cost roughly one-third less than original projections.
Essential Links
- Centers for Medicare and Medicaid Services, Medicare Advantage/Part D Contract and Enrollment Data
- Medicare Drug Coverage (Part D), www.Medicare.gov
- Report to Congress: Medicare Payment Policy (Chapter 14, Status Report on Part D), Medicare Payment Advisory Commission (MedPAC), March 2014
- Centers for Medicare and Medicaid Services, Medicare Advantage/Part D Contract and Enrollment Data
- Medicare Drug Coverage (Part D), www.Medicare.gov
- Report to Congress: Medicare Payment Policy (Chapter 14, Status Report on Part D), Medicare Payment Advisory Commission (MedPAC), March 2014
- The Medicare Prescription Drug Benefit Fact Sheet, Kaiser Family Foundation, November 2013
Overview
The Medicare Prescription Drug, Improvement, and Modernization Act, also called the Medicare Modernization Act or MMA, is a federal law of the United States, enacted in 2003. It produced the largest overhaul of Medicare in the public health program's 38-year history.
The MMA was signed by President George W. Bush on December 8, 2003, after …
Prescription drug benefits
The MMA's most touted feature is the introduction of an entitlement benefit for prescription drugs, through tax breaks and subsidies.
In the years since Medicare's creation in 1965, the role of prescription drugs in patient care has significantly increased. As new and expensive drugs have come into use, patients, particularly senior citizens at whom Medicare was targeted, have found prescriptions harder to afford. The …
Medicare Advantage plans
With the passage of the Balanced Budget Act of 1997, Medicare beneficiaries were given the option to receive their Medicare benefits through private health insurance plans, instead of through the Original Medicare plan (Parts A and B). These programs were known as "Medicare+Choice" or "Part C" plans. Pursuant to the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the compensation and business practices for insurers that offer these plans changed, a…
Health savings accounts
The MMA created a new Health Savings Account statute that replaced and expanded the previous Medical Savings Account law by expanding allowable contributions and employer participation. After the first 10 years over 12 million Americans were enrolled in HSAs (AHIP;EBRI).
Other provisions
While nearly all agreed that some form of prescription drug benefit would be included, other provisions were the subject of prolonged debate in Congress. The complex legislation also changed Medicare in the following ways:
• it mandated a six-city trial of a partly privatized Medicare system (by 2010)
• it gave an extra $25 billion to rural hospitals (at the request of congressional representatives in the rural West)
Legislative history
According to the New York Times December 17, 2004 editorial W.J."Billy" Tauzin, the Louisiana Republican who chaired the Energy and Commerce Committee from 2001 until February 4, 2004 was one of the chief architects of the new Medicare law. In 2004 Tauzin was appointed as chief lobbyist for the Pharmaceutical Research and Manufacturers of America (PhRMA), the trade association and lobby group for the drug industry with a "rumored salary of $2 million a year," dr…
Costs
Initially, the net cost of the program was projected at $400 billion for the ten-year period between 2004 and 2013. Administration official Thomas Scully instructed analyst Richard Foster not to tell Congress of Foster's finding that the cost would actually be over $500 billion. One month after passage, the administration estimated that the net cost of the program over the period between 2006 (the first year the program started paying benefits) and 2015 would be $534 billion. As of F…
Bar to negotiation of prescription drug prices
Since the enactment of Medicare Prescription Drug, Improvement, and Modernization Act in 2003, only insurance companies administering Medicare prescription drug program, not Medicare, have the legal right to negotiate drug prices directly from drug manufacturers. The Medicare Prescription Drug Act expressly prohibited Medicare from negotiating bulk prescription drug prices. The "donut hole" provision of the Patient Protection and Affordable Care Act was an attem…