The cost of prescription medications has risen astronomically over the past decade.   In hopes of defraying some of these costs to seniors, Medicare is introducing a Prescription Drug Coverage (Medicare Part D) component to provide Medicare beneficiaries insurance coverage for their prescription drugs. This new type of coverage will assist paying for both brand name and generic drugs. Anyone who is currently on Medicare A and / or B is eligible to join. The caveat is that Medicare beneficiaries must sign up for this coverage - it is not automatic.

The basic premise of Part D is as follows:  Beneficiaries enrolled prior to Dec. 31, 2005 will begin receiving the benefit on January 1, 2006. The first $250 of drug costs comes out of the beneficiary’s pocket. From $250 -$2250 in drug costs, Medicare will pay 75% of the costs—beneficiary pays 25% of the drug costs. From $2251-$5100, Medicare pays NOTHING, beneficiary pays 100% of these costs. From $5101 and up, Medicare pays 95% of the drug costs—beneficiary pays 5%. In addition to these “deductibles”, beneficiaries will also pay $32 per month premium for this benefit.

As if that weren’t complicated enough, there are more caveats. There will be a variety of benefit providers (final list not to be announced officially until October 13, 2005) - each of whom will be able to determine what drugs they will cover. This means that beneficiaries will need to take their medication lists and compare them to the drug formularies of each provider to be able to select the provider formulary that matches their drug needs. In other words, it is possible that not ALL of the beneficiary’s drugs will be covered depending on what provider is chosen. The trick will be in selecting the provider that BEST covers the most expensive medications of the beneficiary.

To make it even more confusing, these providers (and we hear that there are over 20 of them!) are competing to get beneficiaries to sign with their plans  by offering added incentives such as lower monthly premiums and “deductible” coverages not part of the basic plan. How the elderly are supposed to figure out which plan to go with  on their own is another story!

If you already have drug coverage through your co-insurance plan, you may not need to sign up for Medicare Part D. You should receive a letter from that co-insurance company describing the coverage that you have and how it compares to the new Medicare Part D coverage. SAVE THIS LETTER. Review your coverage carefully. It may be helpful to have the additional Medicare Part D coverage as a backup to your current plan if you can afford the $32 /month  premium.

If beneficiaries fail to sign up for Medicare Part D prior to May 15, 2006, there will be penalties for signing up late. This penalty amounts to a 1% increase in the monthly premium for every month after May 15, 2006, that the beneficiary could have been on the plan but didn’t enroll. The exception would be if the beneficiary can provide the letter from their co-insurance clearly stating that he /she had drug coverage through the un-enrolled time period. This is why saving the correspondence from the co-insurance company is so important. My advice is:  play it safe and sign up for the Medicare Part D to back up your co-insurance if you can afford the $32 premium

The bottom line is that ALL MEDICARE beneficiaries need to take some action in the next month or so. RESEARCH how your current drug coverage compares to Medicare Part D, and how the available providers of Medicare Part D compare for coverage of YOUR drug needs. It may be that your research leads you to keep things as they are. But for most beneficiaries, there will be a huge benefit in signing up for this program. Enrollment for Medicare Part D will begin on November 15, 2005.

Fortunately, there is a free service that can assist you with your research. The program is called SHINE (Serving Health Insurance Needs of the Elderly). Beginning on October 13, 2005, the volunteers manning these phone lines will have a computer data base to assist you with your  comparison research. When you call the volunteer, you will need the following information at your fingertips:  the names of your meds, the dosage of your meds, the current cost of your meds through your current provider, and the preferred pharmacy that you purchase your meds through. The SHINE volunteer can put your data in the computer and tell you which of the Medicare Part D provider(s) will best meet your drug needs based on that information. You can locate a SHINE volunteer by calling the ELDER HELPLINE at 1-800-963-5337. (SHINE volunteers can also provide information on Long Term Care Insurance, Medicaid, and a variety of other health care issues as well.)

The Orlando Medicare Coalition is working hard to get as much information out to the public as possible and will be sponsoring health fairs. These health fairs will  give you an opportunity to do some comparison shopping with the various providers. Come to the fairs armed with the same information (as above)  about your medication needs.   Collect the provider information and TAKE IT HOME to look at carefully. Don’t be persuaded to sign up for a plan without reviewing ALL of the plans very carefully. These providers are going to be competitive in trying to sign up beneficiaries. DON’T allow yourself to be rushed into this decision.

For Medicare beneficiaries that have low incomes and limited assets, the Social Security Administration will be offering a program that will assist with monthly premium and deductible costs for Medicare Part D (see enclosed flyer). Medicare beneficiaries that also receive Medicaid or SSI benefits will automatically be enrolled in this program. The eligibility requirements for this program are less stringent than Medicaid requirements, so beneficiaries that don’t qualify for Medicaid may still be eligible for the Medicare Part D assistance program. For more information on this program, or to see if you may be eligible for this program, contact SHINE or call 1-800-772-1213.   

In summary, the dates to watch for are:

• October 13, 2005 - official announcement of program providers and details of their plans
• November 15, 2005 - Medicare Part D enrollment begins.
• January 1, 2006 - Medicare Part D coverage begins for those enrolled prior to 12/31/05 

Of course, Elder Advocates Incorporated is always available to assist you!

Elder Advocates Incorporated| 407.898.9080 | www.elderadv.com