Medicare’s long-awaited
prescription drug plan is scheduled to be in full
implementation in January 1, 2006. Many seniors have started
receiving mailings about the drug program and there are some
conflicting messages out there.
Formally known as Medicare Part D, several advocates in the
system have dropped the “Part D” connotation in favor of a
new name: Medicare RX. Many Medicare recipients get confused
when they hear Part D, in part because they don’t understand
what Parts A, B, or C cover. By referring to it as Medicare
RX, advocates are hoping that Medicare recipients can easily
identify the new benefit.
What is Medicare RX?
Medicare RX is optional program that will save individuals
who are enrolled in Medicare money on their prescription
drugs. With some exceptions, there is no obligation to join
the program. There is a premium for the coverage as well.
Individuals who are currently enrolled in Medicare can sign
up for RX coverage starting November 15th. Plan coverage
needs to be selected by May 15th. It is possible to join
after May 15th; however the monthly premiums will go up.
Individuals who enroll in a plan before December 31, 2005
will begin the program on January 1, 2006. Individuals who
enroll in the plan after December 31, 2005 will start on the
first of the month after their enrollment date. For example,
someone who signs up for coverage on April 12th will start
on May 1st.
In addition to premiums, there are co-pays as well. The
amount of the co-pay varies depending on the drug coverage
plan that you choose. Private contractors will work with
Medicare to provide plans to Medicare beneficiaries.
Depending on where you live, there may be more than one plan
option. You will need to weigh your co-pay costs and your
own health condition to decide which plan is appropriate.
What happens to my Medigap coverage?
You can keep your Medigap coverage as long as you don’t
enroll in Medicare RX. Check with your Medigap provider to
find out if your plan covers as much as or the same benefits
as Medicare RX in order to make a decision. Your Medigap
provider should be mailing information to you this fall
concerning your coverage limits. You can use this to compare
to Medicare’s prescription plan.
What if I have RX coverage through an employer or
retirement program?
As with Medigap, your insurance provider should mail you a
comparison package explaining their benefits and how they
line up with Medicare RX. Since Medicare RX is a voluntary
program, you do not have to give up your existing plan to
enroll in Medicare’s plan.
What if I need help paying for the coverage?
The Social Security Administration (SSA) has started mailing
out letters to potential low-income beneficiaries in June
2005 letting them know that they may qualify for assistance
with the premium and some of the drug co-pays. The Medicare
website (www.medicare.gov) refers to this assistance as
“extra help.” Qualifying for extra help is determined by
your income and assets (not including your home). The amount
of help that you can receive is also determined by income
and assets.
Most importantly in applying for the extra help is the
letter SSA mailed to those who are potentially eligible.
When you get ready to enroll in a drug plan, the provider
will ask for a copy of this letter. If you have received any
mail from SSA that you do not understand, contact your local
Area Agency on Aging and ask to speak to a benefits
counselor. They can help you understand the letters you have
received as well as answer any questions you may have about
the drug coverage plan.
I think I qualify for extra help, but I didn’t receive a
letter.
If you are single and have yearly resources less than
$11,500 ($23,000 for married couples), you can still apply
for extra help coverage even if the SSA did not identify you
as someone who is potentially eligible. You can apply online
at
https://s044a90.ssa.gov/apps6a/i1020/main.html. Be
prepared to provide information about your income and other
assets you may have. Remember that your home does not count
as an asset for qualification purposes.
Medicare will qualify some individuals depending on their
income or other benefits they may be receiving. These
individuals include:
• Those already receiving Supplemental Security Income (SSI)
benefits and who have Medicare;
• Those who have Medicaid prescription benefits; or
• Those whose state pays their Medicare premiums.
If any of those conditions apply, you will automatically
receive extra help and be enrolled in a qualifying
prescription drug program for Medicare.
How much will I have to pay?
Medicare has established out of pocket maximums depending on
your income range and the amount of your assets. For
example, let’s look at someone who is married with income
between $16,862 and $18,734 with assets less than $20,000.
• Premiums – up to $35 each month on a sliding scale.
• Coverage starts after they pay $50 out of pocket.
• Will pay 15 percent of drug costs after the initial $50.
• Will pay approximately $800 out of pocket before co-pays
drop to $2 for generic medications and $5 for name brand
medicines
• Co-payments will increase after 2006.
This same scenario applies to an individual who is single
with an income between $12,569 and $13,964 with personal
assets less than $10,000.
What happens to my prescription drug discount card?
If you enrolled in the discount program in 2004 that helped
offset the cost of prescription medications, Medicare RX
replaces those programs. You will now apply for the program
directly through SSA and choose a plan according to your
specific needs. The discount cards expire on December 31,
2005.
Where can I find more information?
The “Medicare & You” booklet published by Medicare will be
mailed to program recipients in October 2005. Review the
information in this booklet for the latest in benefit
information. You can also call 1-800-MEDICARE (TTY users
should dial 1-877-486-2048) to speak to someone directly
about the program. Finally, your local Area Agency on Aging
can also provide information about the program or direct you
to a local source of information.
Printable Version
