Citation Numbers: 86 Op. Att'y Gen. 15
Judges: J. JOSEPH CURRAN, JR.
Filed Date: 1/30/2001
Status: Precedential
Modified Date: 7/5/2016
Dear Honorable John Adams Hurson
You have asked for our opinion concerning recent State legislation that created a temporary prescription drug benefit plan for seniors in Maryland who are eligible for, but not served by, part of the federal Medicare program that offers prescription drug benefits. Specifically, you ask what effect the sunset provision in this State law would have if Congress were to create a more comprehensive federal prescription drug benefit program available only to individuals not covered by a state plan.
In our opinion, the General Assembly created the State plan as a temporary measure for the benefit of seniors affected by the decisions of certain managed care programs not to participate in the Medicare program. The General Assembly included the sunset provision to end the temporary State plan upon the creation of a federal plan that covered the same population. However, if Congress limits coverage of a new federal program to seniors not covered by a state program, we cannot say with certainty whether the sunset provision in the Maryland plan would allow Maryland seniors to qualify for the new federal program. Whether a future federal program would cover Maryland seniors would depend on the language of the federal law, as interpreted by the federal Health Care Financing Administration (HCFA), which administers Medicare, and ultimately the courts.
In 1997, Congress created as part of Medicare an optional program that provides prescription drug benefits to some seniors. The Balanced Budget Act of 1997 added to the Medicare program a new Part C, known as Medicare Plus Choice. Pub.L.
The providers of Medicare Plus Choice are reimbursed on a capitated basis; the adequacy of the capitation rates has been the subject of significant debate. Many providers of Medicare Plus Choice plans have withdrawn from the market altogether or have limited the areas in which they offer their plans. As a result, many seniors no longer have access to Medicare Plus Choice providers, or have access to Medicare Plus Choice providers but not to a plan that covers prescription drug costs.
The 2000 legislation recited certain findings as the premise for the temporary State plan. The General Assembly found that, because the cost of providing Medicare Plus Choice benefits that included prescription drug coverage exceeded the income from premiums, managed care organizations had left the Medicare Plus Choice program in a number of jurisdictions in Maryland; as a result, residents of 14 Maryland counties lacked access to such a managed care plan. Chapter 565, Preamble, Laws of Maryland 2000. Moreover, the Legislature found that 15 percent of the seniors in Maryland lacked access to a Medicare Plus Choice managed care plan that provided prescription drug benefits, placing Maryland among the states with the highest percentage of underserved seniors. Id.
The temporary State plan applies in 17 counties identified as medically underserved, and in areas of other counties no longer served by a Medicare Plus Choice provider. HG §
Expenses of the program in excess of the premiums paid by subscribers are to be financed by the Short-Term Prescription Drug Subsidy Plan Fund. That fund consists of the proceeds of a charge imposed on health insurance carriers who participate in the substantial, available, and affordable coverage program2 under the auspices of the Maryland Health Services Cost Review Commission. HG §
The nature of the program as a stopgap measure is reflected by the short title of the law: "Senior Assistance — Short-Term Prescription Drug Subsidy Plan." Moreover, the Preamble states that it is the "intent of the General Assembly to find a temporary means of providing prescription drug benefits in those counties or portions of counties that are medically underserved and have no managed care prescription drug benefits available." (emphasis added). In the same vein, Section 5 of the law provides that the plan will end on "the availability of comparable prescription pharmacy benefits provided by Medicare under Title XVIII of the Social Security Act," or on June 30, 2002, if no federal program is enacted.3 See also Floor Report for Senate Bill 855 (new coverage under State plan "would continue until the federal government provides for a renewed program or two years, whichever is earlier").
In our opinion, the intent of the General Assembly could not be clearer — the plan is a temporary measure to benefit underserved seniors until the federal Medicare program is revised to reach those seniors. The creation of a comparable federal plan as part of Medicare, whether or not the federal plan is limited to states without a state plan, should trigger the sunset provision of Section 5. However, if it were clear that the federal plan did not apply in Maryland and thus "comparable prescription benefits" were not "available" to Maryland seniors, as required by Section 5, the State plan would remain in effect until June 30, 2002.
To the extent that eligibility for new Medicare prescription drug benefits is made contingent on the absence of a state plan, in our opinion, Maryland should be considered a state without a plan by virtue of the sunset provision in Section 5 — either as of the passage of the federal law or as of June 30, 2002. The language of Chapter 565, as well as its legislative history, demonstrates that the General Assembly was not enacting a comprehensive prescription drug benefit program, but was attempting to plug a gap that had arisen in federal coverage under Medicare.
Despite the General Assembly's clear intent, the terms and statutory language creating a new federal program could frustrate that intent. While it is expected that Congress will take some action to address the problems caused by the withdrawal of providers from the Medicare Plus Choice program, no action was taken by the 106th Congress, and the 107th Congress has only recently convened. As of this date, at least four bills concerning the Medicare Plus Choice program or prescription drug benefits have been introduced in the Congress,4 and more bills may be introduced. Of course, it cannot be predicted with certainty whether any of these bills will pass and, if so, whether they will create a prescription drug benefit program that applies only in states with no existing plan, or precisely how such a bill would be worded.5
J. Joseph Curran,Jr. Attorney General
Kathryn M. RoweAssistant Attorney General
Robert N. McDonaldChief Counsel Opinions Advice
. . . On the earlier of the end of June 30, 2002, or the availability of comparable prescription pharmacy benefits provided by Medicare under Title XVIII of the Social Security Act, as amended, with no further action required by the General Assembly, this Act shall be abrogated and of no further force and effect. . . .
Chapter 565, § 5, Laws of Maryland 2000. Read literally, this provision would apparently not sunset the program if the federal government provides for prescription benefits for seniors in a new program that is not part of Title XVIII of the Social Security Act.
*Page 21