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Medicare Drug Plan Changes and You

Posted on: Friday, 30 September 2005, 12:01 CDT

By Ruby L. Bailey, Detroit Free Press

Sep. 30--WASHINGTON -- Starting Saturday, Michigan's 1.5 million Medicare recipients will begin getting sales pitches -- in the mail and by phone -- from insurers touting prescription drug plans under the Medicare law.

The drug benefit is the first major change to Medicare, the nation's health plan for people who are disabled or 65 and older, since it was enacted in 1965.

Sign-up for the coverage begins Nov. 15. Now's the time to begin studying options to find the plan that best fits your needs.

Ten national and several regional plans are among the options. Here are answers to questions about the new program.

QUESTION: What am I supposed to do with all the stuff from companies trying to convince me to sign up for their plans?

ANSWER: Don't toss it on the counter or throw it away. Use the information from insurers to compare co-pays, deductibles and other benefits.

Q: Is there any urgency to sign up quickly?

A: Be aware of all deadlines. You have from Nov. 15 to May 15 to join a plan.

If you don't join by May 15, you won't be able to join until Nov. 15, 2006.

When you eventually sign up, you'll pay 1 percent more for every month you missed the May 15 deadline.

Q: Is this for poor people only?

A: No. In fact, advocates for seniors agree that most Medicare recipients will benefit by signing up for one of the plans.

People with low incomes can qualify for lower premiums and co-pays.

Q: How do I know if I qualify for extra assistance?

A: Your yearly income must be at or below $14,355 if you are single or $19,245 if married and living with your spouse.

Also, your personal property -- not including your house, cars, furniture or jewelry -- must be valued below $11,500 for a single adult and $23,000 for a married couple.

If you qualify, you'll pay no monthly premiums or deductibles and co-pays will be $1-$2 for generic drugs or $3-$5 for name -brand drugs.

You can apply for extra help through the Social Security Administration.

Q: How do I qualify to join the drug plan?

A: If you already receive Medicare, you qualify.

Typically, a person who is 65 or older or on disability qualifies.

Q: How does Medicare prescription drug coverage work?

A: You'll pay a premium with most plans ranging from slightly less than $20 to $68 per month per person (no discount for couples).

Then, typically, you pay the first $250 as a deductible and the plan covers 75 percent, or $1,500, of the next $2,000, no matter what plan you chose.

From $2,250 to $5,100, you pay 100 percent.

After that, catastrophic coverage begins.

At this level, you will pay only $2 a prescription for generic drugs and $5 a prescription for brand -name drugs, or 5 percent of the cost of each prescription -- whichever is higher.

Q: I already have drug coverage. Do I need this?

A: Depends.

If you have coverage as a retiree benefit, the company has to send you a letter telling you whether your current coverage is creditable -- as good as what Medicare will offer.

If it is creditable, the employer can get a subsidy from the government to continue the benefit.

If it's not, you should consider the Medicare program coverage.

Q: How can I tell if my current insurance coverage is better than what I could get from Medicare?

A: You should receive a written notice saying whether your coverage is creditable.

If you don't receive this information by the end of October, call your company. It must respond in writing.

Q: Can I keep my private insurance and still join a Medicare program?

A: No. If your current insurance is creditable or better, it probably would be best to keep what you have.

Q: What if I don't sign up for Medicare drug coverage right away?

A: You'll likely be without prescription drug coverage until you join and, depending on when you sign up, it could cost you more.

If you miss the May deadline, you won't be able to enroll until November 2006.

The penalty for signing up late is an extra 1 percent of the national average premium for each month (or 12 percent for each year).

Q: I won't be eligible until next year. Is that a problem?

A: No. Use the insurance you have currently and compare the Medicare plans when you are eligible.

Q: I have Medicaid and Medicare. How does this affect me?

A: Starting in January, people who are eligible for Medicare no longer will be able to use Medicaid.

Those who qualify only for Medicaid, which is designed to help poor people and children, will continue to get assistance through the state's program.

Q: Are the plans all the same?

A: Plans will differ in the cost of premiums and deductibles, drugs covered and which pharmacies they use. Some will offer a mail-order option.

Typically, each plan will cover at least two drugs in each classification, as well as offer name -brand and generic drugs. Check each plan's list for a particular brand -name drug.

You should be able to compare plans starting Oct. 13 on the Medicare Web site, www.medicare.gov.

The Medicare and You 2006 handbook will have a comparison description and should be mailed soon.

Q: What if I don't take medications right now or only take them occasionally. Should I still sign up now?

A: Maybe. You'd still have to pay the premiums, though you aren't taking any medications now. But you'll have the penalty if you delay enrollment.

Q: What if I have a Medicare drug -discount card?

A: The Medicare-approved drug -discount card program ends in 2006.

You will be able to continue using your card until May 15, or until you sign up for Medicare drug coverage, whichever is sooner.

Q: How do I know the calls and brochures are legitimate?

A: If you receive a phone inquiry, don't give your Social Security number, bank account number or credit card numbers.

If you're unsure about the legitimacy of a company, get a name and phone number and tell them you will call them back. Then check with Medicare, the Social Security Administration or Michigan Medicare/Medicaid Assistance Program.

Look for the Center for Medicare and Medicaid Services logo on any correspondence.

There also is a Medicare RX logo on all approved plans.

Q: Who can help me make these decisions?

A: Start by making a list of all your prescription drugs. Beside each one, write the price you now pay. You can use this list to figure out what you pay for your drugs over the course of a year and how much you will save with Medicare coverage.

If you don't have records, your pharmacy should be able to help.

Check your list against the Medicare drug plan formula that most closely matches the list of drugs you take.

If you don't have Internet access, or are not familiar with searching for information online, ask a family member or friend for help.

Information for the answers to questions posed in this story came from Michigan Medicare/Medicaid Assistance Program, the Medicare program and AARP.

FOR MORE HELP:

Michigan Medicare/Medicaid Assistance Program, www.mymmap.org or 800-803-7174

AARP, www.aarp.org or 888-687-2277

Medicare drug plans online at www.medicare.gov or by calling 800-633-4227

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Copyright (c) 2005, Detroit Free Press

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Source: Detroit Free Press

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