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WASHINGTON -- The Department of Health and Human Services moved dramatically closer to creation of a national Medicare drug benefit program Sept. 23, with the formal approval of a nationwide network of prescription drug plans that will compete with one another to deliver the benefit to millions of Medicare beneficiaries. At least three major drug chains--Walgreens, CVS and Longs--will participate directly as benefit administrators through their pharmacy benefit management divisions.

The Centers for Medicare and Medicaid Services announced the selection of dozens of PDPs that will compete with one another to administer the Medicare Part D rug benefit program. Among them are 10 large-scale insurers that will provide benefits nationwide, as well as scores of regional PDPs. In all, seniors in all 34 of the regions selected by the government as PDP coverage areas will have a dizzying choice of plans from which to choose.

CMS announced that each region would play host to as few as 11 and as many as 20 organizations competing to offer drug coverage. That s far in excess of original expectations for the program; some Medicare advocates had feared seniors would have little choice of PDPs in many less-populated areas. And it bolsters the government's contention that private market competition will foster lower prices for seniors who participate in Part D.

Indeed, noted CMS, at least one prescription drug plan in every state but Alaska will offer Medicare enrollees who join a premium of less than $20 per month versus the $32 average premium that federal planners expected the PDPs to charge.

"As a result of the strong competition, Medicare will ... include options that cost less and provide coverage beyond Medicare's standard benefit," said CMS administrator Mark McClellan.

Nevertheless, the sheer number of competing PDPs in each region--all clamoring for seniors' attention--will surely add to the Part D program's complexity--and to seniors' confusion. "Who do you think's going to be caught in the middle of that? noted Larry Woodruff, an independent pharmacy owner in Atlanta. "It's going to be us, the pharmacists."

McClellan promised his department would help. "We will use the detailed information on drug plans that will be available in the weeks ahead to help every Medicare beneficiary choose a plan that is a good fit," he pledged Among the tools CMS will provide are:

* the "Medicare & You 2006" handbook, which will be mailed to every Medicare household beginning this month.

* the Medicare Web site, www.medicare.gov, and its 24-hour toll-free number, (800) MEDICARE. Beginning early this month, both will provide specific information to help beneficiaries find the drug coverage that suits their needs, according to CMS.

The plans tapped by HHS began marketing their coverage options to Medicare patients Oct. 1. Among the national insurers offering PDP coverage in all 34 regions are Wellcare and UnitedHealth, both of which will draw on Walgreens Health Initiatives to provide the PBM services they'll offer. Through its PharmaCare division, CVS is providing the PBM services for another national carrier, Universal American. Longs' PBM division, RxAmerica, will offer PDP services in 20 regions.

"Thanks to the range of options available, everyone in Medicare will be able to choose a prescription drug plan that addresses their individual concerns about cost, coverage and convenience," HHS Secretary Michael Leavitt said. "For premiums that are in many cases much lower than expected, seniors will be able to get Medicare-approved prescription drug coverage that will help protect their health, as well as their savings."

Medicare Advantage plans, which offer coordinated care for even lower out-of-pocket costs, also will have more comprehensive offerings next year, HHS noted. In 44 states, beneficiaries can select a Medicare Advantage plan that provides prescription drug coverage for no additional cost. In 37 states, beneficiaries will be able to choose a new regional Preferred Provider Organization plan.

CMS-approved national * PDPs

Aetna life Insurance Co.

Connecticut General Life Insurance Co.

Coventry Health & Life Insurance

Medco Containment Life Insurance Co.

MemberHealth

Pacificare Life and Health Insurance Co. (2)

Silverscript Insurance Co. (3)

Unicare (4)

UnitedHealth Care Insurance Co. (2)

Wellcare Health Plans

Primary PBM provider

Aetna Pharmacy Management **

CIGNA Pharmacy Management (1) **

Caremark

Medco **

MemberHealth **

Prescription Solutions **

Caremark **

WellPoint Pharmacy Management, Anthem Prescription Management **

Walgreens Health Initiatives

Walgreens Health Initiatives

Source: Drug Store News

(1) Connecticut General is an operating subsidiary of CIGNA.

(2) Pacificare in July announced it is merging with UnitedHealth Care Insurance Co. Representatives form UnitedHealth said the two companies will still use their respective PBMs for part D.

(3) Silverscript is a subsidiary of Caremark.

(4) Unicare is a subsidiary of WellPoint.

* Approved in all 34 medicare regions ** In-house PBM

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