HHS program to repay states for dual-eligible drug costs

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The Department of Health and Human Services unveiled a demonstration program to repay states for prescription medications for dual eligibles. States incurred these costs this year as the Medicare Part D Prescription Drug Benefit began.

Fully 44 states and the District of Columbia are expected to participate. Six remaining states — Idaho, Indiana, Iowa, Michigan, Nebraska, and South Carolina — did not apply for repayments.

Participating states will be reimbursed for drug costs for dual eligible beneficiaries, or those who are eligible for both Medicaid and Medicare. Medicare will pay states the difference between the amount they received from Medicare drug plans and the amount they actually paid for dual eligibles' Part D covered drugs. The demonstration will also cover states' administrative costs. Many nursing homes complained of dual eligible access problems following the benefit's January start-up.