California Individual And Group Health Insurance Plans

"California will continue to keep our vulnerable residents to ensure their needs are met until this federal system is fully functioning. I want to thank the legislative leaders for working with me to continue our commitment to ensure Californians have access to needed, life-saving medications," said Governor Schwarzenegger.

"This is a federal program experiencing serious problems that need to be fixed. My administration will continue to work with the federal government to resolve these issues and ensure California is fully reimbursed for the costs of taking this necessary emergency action."

On January 1, 2006, under the Medicare Modernization Act, the federal government took responsibility for prescription drug coverage for the nearly one million Californians most in need who are dually eligible for Medi-Cal and Medicare. The transition of these individuals to Medicare plans resulted in an error rate of 20 percent.

On January 12, 2006, to bring immediate relief to Californians impacted by this transition, Governor Schwarzenegger implemented an emergency program to pay for recommendation drugs for beneficiaries who have been incapable to obtain them through their Medicare coverage and agreed with legislative leaders to pass legislation to fund this program.

This legislation, AB 132 by Assembly Speaker Fabian Nunez (D-Los Angeles), allowed for the implementation of a 30-day emergency program and allocated $150 million to fund it. Since that time, California has continued to fill more than 11,000 prescriptions each day.

As of February 1, 2006, the number of Californians impacted by this transition increased by 10,000 newly eligible Californians entering the system and residents continue to experience difficulty in obtaining the medications they need. As a result of this, the Governor and legislative leaders have introduced legislation to extend this program for up to 90 additional days.

"While I'm pleased that the legislature and governor are once again stepping into the break created by the Bush Administration and are protecting vulnerable Californians from flaws in the Medicare Part D program, the Bush Administration must also step up, fix the problem, and fully pay us for all the funds we advance," said Senate President Pro Tem Don Perata.

"I'm delighted to work with the Governor once again to address this problem. But the state should stop having to put its finger in the dam. There are more problems frightening on the horizon since the federal government has only agreed to reimburse the state through February 15th, and recipients are changing their health plans and will be denied their drugs at pharmacies once again. The Administration and Congress should step up to the plate and solve this problem once and for all," continued Assembly Speaker Fabian Nunez.

"Last month, Democrats and Republicans worked together to ensure the elderly, the poor and the disabled continued to receive the critical medications they depend upon. Today, we again stand united to protect the neediest Californians while the federal government continues to work out the glitches in the new Medicare prescription drug program. I applaud Governor Schwarzenegger for showing strong leadership to defend the most vulnerable in our state during their time of need," added Assembly Republican Leader Kevin McCarthy.

SB 1233 continues the emergency program established in January to ensure the nearly one million Californians dually eligible for Medi-Cal and Medicare are capable to receive the medications they need.
Specifically, this legislation:

• Authorizes Governor Schwarzenegger and the Department of Health Services to be the payor of last resort for dual eligible unable to get their medications through the Medicare program to ensure no dual eligible leave the pharmacy without their needed preparation drugs.
• Continues the 30-day emergency program the state recognized on January 12 for an additional 30 days.
• Provides the Governor with the authority to enact two additional 30-day extensions, in the event they are needed, for a total of 90 days.
• Provides the Department of Health Services the authority to seek repayment from the federal government and the Medicare Part D plans for the cost of this crisis action.
  
  The $150 million the Legislature allocated under AB 132 to fund this emergency program will be used to continue to support it. The federal government has committed to reimbursing states for these costs through February 15, 2006. Today Governor Schwarzenegger sent a letter to United States Health and Human Services Secretary Michael Leavitt requesting the federal government extend this reimbursement period for as long as it takes to ensure Californians have access to the medications they need and also reimburse states for the full cost of Medicare co-payments.
  
  In addition, the Governor asked the Secretary to provide states with the data necessary to accurately assess whether or not problems in the federal system have been determined and to take responsibility through the Well point drug plan for covering those continuing to experience problems so that states can end their emergency programs.
  
  To receive reimbursement under this emergency program, a pharmacy must endorse that it was either unable to obtain necessary information from Medicare to submit a claim, its claim was incorrectly without or that the beneficiary's deductible or co-payment was higher than the $1 to $5 amount recognized by Medicare.