OLR Research Report

November 19, 2009




By: Robin K. Cohen, Principal Analyst

You asked for an explanation of the recent changes in the ConnPACE program, including changes the Department of Social Services (DSS) made earlier this year and those in the 2009 human services implementer, PA 09-5, SSS.


The legislative and executive branches have made several changes in the ConnPACE program during the past six months. These include (1) increasing the program's registration fee, (2) freezing the income limits, (3) establishing an enrollment period for new ConnPACE applicants, (4) requiring participants to enroll in “benchmark” plans, and (5) eliminating state payments for drugs not on a ConnPACE recipient's Medicare Part D formulary. The first four changes are required by PA 09-5, SSS and will be implemented on January 1, 2010. The nonformulary changes began in June 2009 and will be expanded starting January 1.


Registration Fee

The legislature increased the annual registration fee for program participants from $30 to $45. DSS will begin charging the higher fee starting on January 1, 2010, but individuals already enrolled in the program will not pay the higher fee until their renewal date (PA 09-5, SSS, 33).

Freeze in Income Limits

The legislature also froze the program's income limits until January 1, 2012. January 1 is used because ConnPACE increases are tied to increases in Social Security benefits, which take effect each January 1. (It should be noted that Social Security benefits are not rising in 2010.) The current limits are $25,100 for a single person and $33,800 for married couples (PA 09-5, SSS, 33).

Enrollment Period

Starting in January, new applicants for ConnPACE will be able to apply for benefits only between November 15 and December 30 of each year. This enrollment period coincides with the Medicare Part D enrollment period. But new applicants can apply at other times of the year provided it is within 31 days of either (1) turning 65 or (2) becoming eligible for federal Social Security Disability Income (SSDI) or Supplemental Security Income (SSI) (PA 09-5, SSS, 33).

Enrollment in Benchmark Plans

ConnPACE enrollees who are also eligible for Medicare must now enroll in one of 13 “benchmark” Medicare Part D prescription drug plans. These plans are a subset of the several dozen Part D plans available in Connecticut. Benchmark plans offer basic Part D coverage with premiums equal to or lower than the regional low-income premium subsidy amount that the federal government calculates annually. The monthly premiums range from $29.00 (AARP MedicareRX Saver) to $34.50 (Advantage Star Plan by Rx America). By law, the state (DSS) pays the Part D plan premiums for ConnPACE enrollees. Previously, ConnPACE recipients could enroll in a plan of their choice and DSS would pay the higher premiums (PA 09-5, SSS, 47).

Nonformulary Drugs

Part D plans have formularies, or lists of drugs, for which the plans will pay. Previously, DSS would pay for ConnPACE recipients to get drugs that were not on a plan's formulary. But DSS plans to completely stop paying for these drugs.

In May 2009, DSS sent a letter to ConnPACE recipients (with notice to the legislature) informing them that it would no longer be paying for new nonformulary drugs (those that the ConnPACE recipient was not currently taking), effective June 1, 2009. DSS advised recipients to talk with their medical provider to either change the drug to one that was on the plan's formulary or to ask the Part D plan for an exception or authorization so the drug would be covered.

The DSS website indicates that DSS will be eliminate coverage for all nonformulary drugs, beginning January 1, 2010.

The legislature created a Medicare Part D Supplemental Needs Fund in 2005 (CGS 17b-265e) for DSS to use to pay for nonformulary drugs for individuals whose medical needs require that they obtain these specific drugs. People requesting help from this fund must show that they have made a good faith effort to (1) enroll in a Part D plan that the commissioner or his agent have recommended and (2) use the plan's exception process.

The fund's use is subject to available funds. The Office of Fiscal Analysis (OFA) budget book shows a reduction in the fund's budget from an estimated FY 09 expenditure of nearly $24.8 million to a $3.1 million appropriation in FY 10 and a $4.3 million appropriation in FY 11. The Finance Advisory Committee recently transferred an additional $3.5 million from another DSS account into the fund's account.

Appeals. By law, DSS pursues payment for prescriptions denied as nonformulary drugs, including remedies available through reconsideration by an independent review entity, review by an administrative law judge, the Medicare Appeals Council, or the federal district court. DSS receives any reimbursement that results from such appeals.

PA 09-5, SSS ( 83) requires DSS, within available appropriations, to contract with (1) the Center for Medicare Advocacy to provide assistance with Medicare Part D plan appeals relating to medically necessary prescription denials and (2) a pharmacy association or pharmacist to help clients choose a Part D plan that best meets their needs.

Moving ConnPACE Recipients into the Medicare Savings Program

In addition to the above changes, DSS will begin implementing provisions in PA 09-2 and PA 09-5, SSS that expand eligibility for the Medicare Savings Program (MSP, in which the state's Medicaid program pays for individuals' Medicare cost sharing). Essentially, the new law directs DSS to increase the income limits in the MSP program to the ConnPACE limits and eliminates the assets test for the MSP. Eligibility for MSP automatically makes someone eligible for the federal Medicare Part D low-income subsidy.

The effect of this change is that most (participation in MSP is optional) ConnPACE recipients who are Medicare recipients will be moved into the MSP program, which means, for example, that the federal government, instead of the ConnPACE program, will pay Part D premiums, part of the co-pays, and the “donut hole.”

We have asked DSS how it plans to implement this change and transition Medicare-eligible ConnPACE recipients into the MSP. We will follow-up with you once we receive a response.