	Background

		The Medicare Part D Program

In the Medicare Part D program, drug plan sponsors compete to deliver  prescription drug benefits and attract enrollees. The remaining two study sponsors  chose to develop nonmodel ANOCs for the 2008 AEP. Stakeholders Raised Concerns about the ANOC’s Readability; CMS Did Not Assess the Effectiveness of Its Model ANOCs

Stakeholders have expressed various concerns regarding the readability of  the ANOC and we found that prior to the 2008 and 2009 AEPs CMS did not  systematically evaluate its effectiveness in conveying plan changes to  beneficiaries. To help ensure that  their enrollees understood the significance of plan changes, two sponsors  in our study mailed supplemental information that showed changes in  coverage and costs for the specific drugs the enrollee took in the past year. CMS officials recently  reported that on October 1, 2008, they initiated an evaluation of their  annual Medicare beneficiary materials—particularly the combined ANOC- EOC for the 2010 AEP—to assess their reading level, effectiveness, and  length, among other factors. Such an evaluation is particularly important  in light of changes that CMS made for the 2009 AEP, which raised further  concerns among stakeholders. However, it is unclear whether the  evaluation will consider potential benefits of alternative formats for  communicating plan changes to beneficiaries. Stakeholders Expressed Concern about the Readability of CMS Model ANOC

Five sponsors and other stakeholders in our study noted that CMS’s model  materials for the 2008 AEP were not sufficiently concise or beneficiary  friendly and felt that the language in the model ANOC was at a reading  level too high for some beneficiaries. CMS and sponsors made  modifications to the enrollment process that resulted in a median  processing time of 5 days for applications submitted throughout the 2008  AEP. However, the statutorily mandated AEP schedule—November 15 to  December 31 with coverage effective January 1—lacks sufficient time in  which to fully process enrollment applications. As a result, stakeholders  reported inaccurate charges, additional administrative burden, and  inconveniences for the beneficiary following the 2008 AEP. Not All Beneficiaries Switching Plans Were Fully Enrolled Before Their New Coverage Began

Despite these improvements, we found that 15 percent of the  approximately 1 million beneficiaries choosing to switch plans during the  2008 AEP were at risk of not having access to their new coverage on  January 1, 2008. CMS data also show that the time needed to fully process an enrollment  application varied over the course of the AEP. Some stakeholders we interviewed in our  study said that creating an interval for enrollment processing between the  end of the AEP and the effective date of coverage would help ensure that  coverage for a beneficiary switching plans would be in place on January 1. Although CMS told us that they recently initiated an evaluation  of its annual notification materials, it is unclear whether alternative  formats for the ANOC-EOC will be considered. Under the  current mandated schedule, it is not possible to guarantee that  beneficiaries choosing to switch plans late in December are fully enrolled  in their new plans with pharmacists having sufficient evidence of the new  coverage by January 1.
Why GAO Did This Study

In Medicare Part D, enrollees in stand-alone prescription drug plans (PDPs) are allowed to switch plans during an annual coordinated election period (AEP) set under law from November 15 to December 31, with new coverage effective January 1. The Centers for Medicare & Medicaid Services (CMS) required that plan sponsors send an Annual Notice of Change (ANOC)--using either its model or a nonmodel format--before the 2008 AEP. Among other things, GAO examined: (1) stakeholders' views of the model ANOC and CMS's efforts to assure its effectiveness, and (2) how the scheduling of the AEP affects the enrollment process for beneficiaries switching PDPs. Among the largest PDP sponsors, we selected eight to interview along with other stakeholders involved in the AEP. We also obtained and analyzed data from CMS.

What GAO Found

Sponsors, pharmacists, beneficiary advocates, and counselors GAO interviewed expressed concern that CMS's model ANOC for the 2008 AEP did not effectively communicate drug plan changes to enrollees. They noted that it contained language at a reading level too high for some beneficiaries as well as too much, often irrelevant, information. To help ensure their enrollees understood how plan changes would affect them personally, two study sponsors mailed additional information detailing specific changes in coverage and costs for drugs the beneficiary took in the past year. Despite GAO's previous recommendation that CMS ensure that its Part D materials meet communications guidelines, CMS's process for developing its model ANOC did not include a systematic evaluation of its effectiveness. However, CMS officials reported that they recently initiated an evaluation of their annual Medicare beneficiary materials for the 2010 AEP that will examine reading levels, effectiveness, and length, among other factors. Such an evaluation is important in light of changes CMS has made for the 2009 AEP, which have raised further concerns among stakeholders. It is unclear whether alternative formats for communicating plan changes to beneficiaries will be considered. Although CMS and plan sponsors made improvements to the enrollment process, CMS data showed that about 15 percent of beneficiaries who chose to switch plans in the 2008 AEP were not fully enrolled in their new plan by January 1. Modifications to the enrollment process for the 2008 AEP reduced the time needed to enroll beneficiaries in a new plan to a median of 5 days. However, the volume of applications submitted late in the AEP contributed to beneficiaries being at risk of not having access to their new coverage by January 1. In fact, among the beneficiaries who submitted applications after December 15, 40 percent were not completely processed until after the effective date of their new coverage. As a result, stakeholders reported that beneficiaries, pharmacies, and sponsors faced various operational challenges, including the risk of inaccurate charges and additional administrative burden. Some stakeholders we interviewed for our study said that creating an interval for enrollment processing between the end of the AEP and the effective date of coverage would help ensure that beneficiaries switching plans would have their coverage in place on January 1.