Feds will repay states directly for Part D after all – in some instances

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The federal government will repay states for drug expenses not covered by prescription drug plans (PDPs) after all. Health and Human Services Secretary Michael Leavitt made the announcement Tuesday.

Previously, federal officials had said that states could expect reimbursement only from PDPs. Problems with the new Medicare Part D prescription drug benefit have been so widespread, however, government officials now say they will cover expenses above and beyond what PDP's are obligated to pay.

States had covered many nursing home residents' drug needs through Medicaid before Part D converted most of them into the Medicare program Jan. 1. States continue to have the option to provide drugs not covered by PDPs, or in emergency situations as they see fit.

More than 20 states have declared imposed emergency measures or otherwise decided to continue coverage for low-income beneficiaries because of numerous problems with Part D's start-up.