Senators Release Letter to Bush Administration Demanding State Reimbursement One Day before HHS Secretary Leavitt Visits New Jersey
Monday, April 10, 2006
Edison, NJ - One day before Health and Human Services Secretary Michael Leavitt visits New Jersey to discuss the Medicare Part D Prescription Drug benefit, U.S. Senators Frank Lautenberg and Robert Menendez joined senior citizens in Edison today to call on the Bush administration to extend the May 15 deadline for seniors to enroll in the drug plan. "I hope Secretary Leavitt is bringing a check when he visits to New Jersey to pay back our taxpayers who are footing the bill for his agency's mistakes," said Lautenberg. "The Bush administration unfairly wants our seniors to make a decision about this complicated Medicare plan by May 15th, or face a penalty. That is just unfair." "Secretary Leavitt needs to bring more than empty rhetoric to New Jersey, he needs to bring answers - answers for our seniors who are confused about this program and need more time to examine their options, and answers for our state as it waits for reimbursement," said Menendez. Since enacted, the Medicare Part D drug program has been plagued with problems, and seniors have complained that they face a bewildering array of choices. In New Jersey, there are 19 providers offering 45 different prescription drug plans, with premiums that range from $4.43 to $66.53. The Senators also released a letter to Leavitt calling on the federal government to reimburse the state of New Jersey for costs it has been forced to cover because of problems with the plan. Due to registration and provider payment issues, from January through March, New Jersey spent more than $100 million to provide emergency coverage to dual eligibles ($44 million) and PAAD beneficiaries ($75 million). The State has been told that they may receive an initial reimbursement from CMS in April, but has yet to receive any. The full text of the letter follows:
April 10, 2006
The Honorable Michael O. Leavitt Secretary of Health and Human Services Department of Health and Human Services 200 Independence Avenue, S.W. Washington, DC 20201
Dear Secretary Leavitt:
As you know, during the first three months of the new Medicare drug benefit many beneficiaries were unable to get their prescription drugs due to errors made by the Center for Medicare and Medicaid Services (CMS). As a result of CMS's failures, 46 states were forced to step in and pay for prescriptions on an emergency basis. Shortly after Congress threatened to enact legislation requiring CMS to repay these funds to the states, your agency created a temporary waiver reimbursement program to cover expenses incurred by the states due to CMS's errors. While we were initially encouraged by CMS's actions, we are concerned that three months after your pledge, no state has actually been reimbursed for expenses associated with the emergency coverage programs.
Essentially, these states have loaned Medicare Part D money - taking on an expense that private health plans were already paid to cover. Most states are already facing tight fiscal constraints, and these payments to bail out CMS have only worsened many states' financial picture. In light of this grave situation we urge CMS to begin making the promised payments to the states immediately. Please inform us of the date you will begin releasing funds to the states or whether you need specific legislative authority to carry out the reimbursement.
Thank you for your immediate attention to this matter. We look forward to receiving your response.
Sincerely, United States Senators Frank R. Lautenberg (D-NJ), Robert Menendez (D-NJ), John Kerry (D-MA), Stabenow (D-MI): Edward Kennedy (D-MA), Joe Lieberman (D-CT), Mark Dayton (D-MN), Hillary Rodham Clinton (D-NY), Jack Reed (D-RI), Charles Schumer (D-NY), Barbra Boxer (D-CA), Tim Johnson (D-SD), and Christopher Dodd (D-CT).