I’m sure you know by now that the Medicare Prescription drug coverage plan began January 1^st, 2006. As you can tell from TV, radio and newspaper advertising, there are many plans available. It’s up to you to decide whether to join a Medicare drug plan and to choose the plan that is right for you.

 

The good news for people with diabetes like you is that your current coverage for diabetes testing supplies remains the same. This means you can continue receiving your supplies from Diabetes Management & Supplies with no interruption of service. These items are covered under Medicare Part B. Your Part B coverage will stay the same regardless of whether you join a Medicare drug plan or not.

 

Here are some things to remember when selecting a Medicare Prescription drug plan:

• Medicare Prescription drug coverage is available now to help people with Medicare pay for the prescriptions they need.

• Medicare coverage for prescription medications is available to everyone with Medicare.

• There is also additional financial help available for those who need it most.

• The Medicare Prescription drug coverage pays for brand-name and generic drugs.

• You will be able to choose between at least two Medicare drug plans, selecting the plan that best suits your needs.

Frequently Asked Questions

 

Who is eligible for Medicare Prescription drug coverage?

All people who have Medicare Part A and/or Part B are eligible to enroll regardless of age, income or existing health conditions.

 

Is participation mandatory?

No. You can choose whether to join in a Medicare drug plan.

 

How does Medicare Prescription drug coverage work?

Private insurance companies worked with Medicare to develop prescription drug plans under Medicare's standard of care guidelines. Each plan is different, so people will have to consider what coverage they have, if any, to determine if Medicare Prescription drug coverage will be of greater benefit to them. For example, if you have prescription drug coverage through your former employer or union and the plan adequately covers prescription expenses on average at least as good as Medicare Prescription drug coverage, you may want to stay with that plan; on the other hand, if a Medicare drug plan can offer greater coverage than you currently have, you may want to join a Medicare drug plan.

 

Can Medicare Prescription drug coverage be purchased directly from Medicare?

No. All plans are available through private insurance companies that have contracted with Medicare to provide this benefit.

 

Will people who receive prescription coverage through the VA have to change plans?

No. Medicare Prescription drug coverage will have no impact on VA benefits.

 

Will Medicare Prescription drug coverage be available in the US territories?

Yes.

 

Will prescriptions be free?

No. Just like other insurance plans, you will pay a portion of the cost. Typically, Medicare will pay 75% and you will pay the remaining 25% co-payment after an initial deductible. In addition, you will have to pay a monthly premium depending on the plan you select. See questions below.

 

How much will people have to pay for Medicare Prescription drug coverage?

Most plans have a yearly deductible of $250. In addition, the typical premium is about $37 per month (approximately $444 per year) in 2006. Plus, participants pay a portion of the cost (a co-payment) for each prescription based on the plan you select.

 

Once a beneficiary has paid the entire $250 deductible, how much will his or her prescription drug plan cover?

In a typical plan, after you have met the $250 deductible, Medicare will pay up to 75% of prescription drug costs. You pay the other 25% until total drug expenditures reach $2,250. In other words, you pay $500 for the next $2,000 of expense!

 

What happens if my drugs cost more than $2,500 per year?

If your total drug costs reach above $2,500 in a year, you become responsible for paying 100% of the prescription cost until your annual out-of-pocket drug costs reach $3,600 in that year. This is called the “gap” or the “hole in the doughnut.” For costs exceeding $3,600 in a year, the plan will pay most costs with no upper limit. You will still pay a small amount, such as 5% or a flat co-payment for each prescription.

 

When does enrollment in Medicare Prescription drug coverage begin?

The initial enrollment period began November 15, 2005 and ends May 15, 2006. 

 

When did Medicare Prescription drug coverage take effect?

January 1, 2006.

 

What is a late enrollment penalty?

If you do not have creditable coverage through a retirement plan or union, and you delay joining a Medicare prescription drug plan when first eligible, an additional penalty fee of at least 1% of the premium for every month you are not enrolled will apply. The higher premium will be in effect for the entire time you participate in Medicare drug plan.

 

Why is there a late enrollment penalty?

Congress made the rule to encourage people to enroll in the beginning, or when they first become eligible, instead of waiting to join when they are ill and healthcare costs are higher.

 

What is “creditable coverage?”

Creditable coverage refers to coverage from an employee or union plan that is on average at least as good as Medicare's standard level of coverage. If you are enrolled in a plan that has creditable coverage, you can wait to enroll in a Medicare drug plan without incurring a penalty for late enrollment. Your current plan will notify you if your retiree benefit provides you with creditable coverage.

 

Where can people get more information?

Call Medicare at 1-800-MEDICARE or visit Medicare's web site at www.medicare.gov.

 

How do Medicare beneficiaries get started?

Most people will need to evaluate the Medicare drug plans offered in their area.

The government’s Medicare and You 2006 Handbook lists the approved plans to choose from in your area (or look at www.Medicare.gov for the most up to date information). You can join the plan of your choice between November 15, 2005 and May 15, 2006. But remember, there is a penalty if you choose not to join a plan when you are first eligible and you do not have “creditable coverage” from a current or former employer or union.

 

If you have both Medicare and Medicaid, Medicare enrolled you in a plan on January 1, 2006 to make sure you get help paying for your prescription drug costs.

 

For people with limited income or resources, if you don’t join a plan by May 15, 2006, Medicare will enroll you in a plan to make sure you get help paying for your prescription drug costs.

 

In either case, if you find a Medicare plan that better meets your needs, you can switch.

 

What is a Medicare Advantage Plan?

Medicare Advantage Plans and other Medicare Health Plans are organizations such as HMOs, PPOs and Managed Care Plans. These plans manage all your healthcare needs by combining Medicare Part A (Hospitalization), Part B (Doctors and Medical Supplies) and, now, prescription drugs. In the past, you would have known them by the name "Medicare +Choice". 

 

What is a Stand-Alone Medicare Prescription Drug Plan?

A stand-alone Medicare Prescription drug plan covers only prescription drugs. If you join a Medicare Prescription drug plan you will need to continue your Part A and Part B coverage separately.

 

How will the Medicare drug plans differ?

Medicare drug plans differ on which prescriptions are be covered. All the plans meet Medicare's standard level of care criteria; however, some plans offer more coverage and additional drugs, but at a higher premium. Additionally, there may be differences in pharmacies you can use to get your medication.

 

Will all drugs be covered?

Each Medicare drug plan has a Medicare-approved list of drugs that are covered. The list is called a “formulary”. Formularies vary from plan to plan, so it's important to compare each formulary to find the plan that best meets your medication needs.

 

What is a formulary?

A formulary is a list of drugs that each particular plan covers, and it differs from plan to plan. Be sure to request a formulary from the plans you wish to compare by calling each plan’s benefits administrator. You will want to choose a plan that best suits your prescription drug needs.

 

What else should I know about comparing formularies?

You should know that the cost of medications varies from plan to plan. You will want to determine if the deductible and co-insurance fees are within your budget. Note that some formularies may not cover one or more of the medications you take. If one or more of your medications isn't listed, you may want to consider another plan. Alternatively, your doctor might be able to write a new prescription for a medication that is equal in therapeutic value and is covered by a particular formulary.

 

Which drugs are excluded from the formularies?

Certain drugs are excluded from Medicare Prescription drug coverage by law, most notably:

• Drugs used for anorexia

• Drugs used for weight loss

• Drugs used for weight gain

• Drugs used to promote fertility

• Drugs used to promote hair growth

• Cough and cold remedies

• Prescription vitamins and mineral supplements (except prenatal vitamins and fluoride preparations)

• Non-prescription drugs

• Inpatient drugs

• Barbituates (such as sleeping pills)

• Benzodiazepines (such as Xanax® and Valium®)

 

Is medication management available?

Yes. Help is available to ensure that your medications work well together to help avoid negative drug interactions. It's called “medication therapy management.” 

 

Will participating pharmacies buy drugs from Canada?

No. Only drugs approved by the FDA for sale in the United States of America will be eligible for coverage.

 

Can beneficiaries have their premiums deducted from their Social Security checks every month?

For the most part, yes. Just like your Part B premium, you can have your Medicare drug plan premium deducted from your Social Security check.

 

Is help available for people with limited income and resources?

Yes. If you are single and your income is below $14,355 and your savings, investments and real estate (other than your home) are valued at no more than $11,500, you may qualify for extra help from the government. If you are married and living with your spouse and your income is below $19,245 and your savings, investments and real estate (other than your home) are not worth more than $23,000, you may also qualify. In some cases, people with limited income and resources will not have to pay premiums or co-insurance for a Medicare drug plan. Income amounts may be higher in Alaska and Hawaii. 

 

What assets are counted to determine if one is eligible for assistance?

Assets, including cash or property that can be converted to cash within 20 days, may be counted. Property excluded from the count includes the primary home, burial plots or burial agreements. Funds of up to $1,500 that are set aside for burial arrangements are also not counted. 

 

When should people start applying for assistance?

You may get an application in the mail from SSA for extra help paying for a Medicare prescription drug plan. It is very important that you fill out this application and return it to SSA. If you don’t get an application in the mail and think you may qualify for this help, call SSA at 1-800-772-1213. TTY users should call 1-800- 325-0778. You can also visit www.socialsecurity.gov on the web. SSA’s application process provides you with the quickest decision. You can also go to your State Medical Assistance office to apply. 

 

Once enrolled in a Medicare drug plan, can a participant change plans?

Yes. Each year there will be an annual enrollment period from November 15 through December 31, and participants can change plans then. Another circumstance that may give a you the right to change plans would be if you moved outside of your plan's service area, you could then choose a plan that services the new location.

 

Will people who don't spend very much each year on prescriptions benefit from having this?

Yes. Those who participate in a Medicare drug plan will have access to discounts on the medications they purchase, as well as peace of mind should they become ill in the future.

 

What types of Medicare drug plans can I choose from?

There are three basic ways you can participate. They are:

 

Stand-Alone Medicare Prescription Drug Plans - If you participate in a Stand-Alone Medicare Prescription Drug Plan, nothing will change with your Medicare Part A or B coverage. You will still have the freedom to choose whatever participating doctor you prefer, and you may fill your prescriptions through the participating mail order or retail pharmacy of your choice.

 

Medicare Advantage Plan or other Medicare Health Plans with Prescription Drug Coverage (HMO or PPO) - If you choose to enroll in a Medicare Advantage Prescription Drug Plan, all aspects of your healthcare - including your Medicare Part A and Part B coverage - are managed for you. You will choose a healthcare provider from a list approved by your plan, and you must fill your prescriptions through pharmacies that participate with your plan.

 

Employee Retirement Plan - This is a plan provided to you by your former employer or union. If your plan is “creditable” (on average, at least as good as a standard Medicare drug plan), you may want to stay in that plan. All employee retirement plans are required by law to inform you if the plan is considered “creditable.” If in the future you wish to participate in a Medicare drug plan, you won't be penalized for waiting to enroll.

 

What does the typical Medicare drug plan look like, dollar-wise?

In addition to the premium you may pay, the benefits design for a basic plan has the following elements:

 

You generally have a $250 deductible.

The plan will pay 75% of your drug costs until you reach $2,250 - you pay 25% of the cost (total of $500).

You will then pay 100% of your drug costs until you reach a total out of pocket costs of $3,600 per year (or $5,100 in total drug spending)

After you have incurred $3,600 in out of pocket drug costs, the plan will pay 95% and you will pay 5%.

Note: The above numbers apply annually.There will be many different plans, each offering different deductibles, co-payments and pricing!

 

Should I choose a regional or a national plan?

It depends. Let's say you live in Michigan but you spend your winters in Florida. You would want to choose a national plan. If, on the other hand, you live in Michigan year-round, a regional plan would satisfy your needs as well as a national plan.