Advising persons about Part D benefits

October 10, 2005

Last month's column addressed Medicare prescription drug benefits for persons with Medicare and low incomes. This group includes about six million people who are enrolled in Medicaid; they will be enrolled automatically in a prescription drug plan (PDP) if they do not choose a plan on their own. Another eight million people with limited income and assets are eligible for assistance with paying the premium and out-of-pocket expenses under the Part D program. The Social Security Administration is now accepting applications for assistance and is able to answer individual questions about the various Part D options.

This leaves approximately 27 million people who will be the target of Medicare outreach. Agencies and organizations are expanding efforts to assist people with understanding their Medicare options. A key message is that new Medicare benefits can save money on drug costs, replacing Medicare-approved drug discount cards and the $600 low-income credit.

Medicare beneficiaries will have questions about all the options and how to choose the one that is best for them. A new Medicare & You 2006 Handbook will have information specific to the drug coverage and plans available in the recipient's area of primary residence. Those who have questions are directed to call 1-(800) MEDICARE or visit http://www.medicare.gov. Some pharmacies have agreed to host information booths, and persons with Medicare should be watching for local informational meetings.

A brief series of questions may help pharmacy staff give initial guidance to people who request help:

1. Does the person have a PDP from his or her former employer or union?

The law obligates retiree benefit plans to tell members about any decisions they need to make. The Medicare Modernization Act included incentives that encourage the current plan sponsor to continue the existing coverage. If coverage will continue and is as good as or better than the standard Medicare plan, retirees may elect to keep their current coverage. If the retiree plan is discontinued in the future, there will be an opportunity to enroll in Medicare without penalty.

2. Is the person covered through a Medicare managed care option (Medicare Advantage) that includes coverage for prescription drugs?

Medicare Advantage (MA) programs will send information to their current members explaining their coverage options. MA plans are likely to offer even more coverage than before and be better than a stand-alone PDP. If satisfied with MA, a person may continue with the plan he or she has or switch to another one.

3. Does the person have a Medigap policy that includes drug coverage?

People cannot have prescription drug coverage from a Medigap policy and a Medicare plan at the same time. As of Jan. 1, 2006, Medigap plans with drug coverage cannot be sold, issued, or renewed unless the plan is modified to exclude Rx drug coverage. Of course, if policyholders choose not to enroll in a Medicare drug plan, a Medigap policy remains an option for them.

4. Is the person eligible for drug coverage from Veterans Affairs, the military including TRICARE, a state pharmacy assistance plan, or other group health plan?

Persons may keep prescription drug coverage that is at least as good as the Medicare standard coverage. Those who have coverage under other government or private plans will get information that tells them whether the plan is, on average, at least as good as a standard Medicare PDP. The plan also will notify them if the coverage changes so that it is no longer as good as the Medicare plans. They will not pay a penalty if they decide to enroll in a Medicare plan at a later date.

5. Which plan is right for me?

Approved plans will specify out-of-pocket costs and information about drug coverage starting this month. A major consideration will be whether an individual's medications are covered by a plan formulary or whether there is a process for getting approval for an individual exception. The State Health Insurance Assistance counselor or local Administration on Aging office is the preferred resource for help in sorting out the options.