HHS and the CMS have announced the creation of 34 regions for prescription drug coverage to be administered under traditional Medicare and 26 regions where administration of the drug coverage will take place under a Medicare PPO.
The CMS had until Jan. 1, 2005, to create the regions under the Medicare Modernization Act of 2003. Medicare beneficiaries will start getting prescription drug coverage on Jan. 1, 2006.
In designing the regions, the CMS considered their sizes to ensure they would be large enough to support networks but small enough that companies contracting to administer the benefit would be able to start enrolling members quickly. It also considered the availability of companies to participate in the region, tried to limit cost variation among states and considered current Medicare patient flow, particularly with beneficiaries who access healthcare across state lines.
While the PPO regions and traditional Medicare regions closely match, some PPO regions include more states to ensure a large enough patient base to attract PPOs.
To see a copy of the HHS release, go to hhs.gov.