Medicare Prescription Drug Plans

1
2005 National Medicare You Training Program
Speaker Name Group Name Date
2
Changes in MedicareKeeping up with Todays
Health Care

• Promoting a healthy lifestyle
• Covering preventive services
• Offering prescription drug coverage
• Expanding coordinated care options
• Including care for chronic conditions
• Helping people with Medicare live longer,
  healthier lives

3
What You Need to Know Now

• Medicare Prescription Drug Coverage

4
Important Information For All People With
Medicare

• Medicare prescription drug coverage is available
  to all people with Medicare
  
• There is additional help for those who need it
  most
  
• Medicare prescription drug coverage pays for
  brand-name as well as generic drugs
  
• Look for a Medicare prescription drug plan that
  meets your needs
  
• Medicare prescription drug coverage helps you pay
  for the prescriptions you need

5
Important Information For All People With
Medicare

• Medicare prescription drug coverage is available
  to all people with Medicare
  
• There is additional help for those who need it
  most
  
• Medicare prescription drug coverage pays for
  brand-name as well as generic drugs
  
• Look for a Medicare prescription drug plan that
  meets your needs
  
• Medicare prescription drug coverage helps you pay
  for the prescriptions you need

6
Medicare Prescription Drug Coverage

• Begins January 1, 2006
• Available for all people with Medicare
• Part A, Part B, or both
• For minimum standard coverage in 2006, enrollees
  would pay
  
• Average monthly premium of about 32
• First 250 per year for prescriptions
  (deductible)
  
• Part of the cost of prescriptions after 250
• 5 of drug costs (or small copayment) after
  paying 3,600 out of pocket

7
Savings in 2006

• On average, for a person with Medicare and no
  drug coverage now
  
• Total drug spending will go down by about 50
• Over 1,100 per year saved
• People with other drug coverage that, on average,
  is at least as good as Medicares also may save
  money
  
• These estimates do not include the extra help for
  people with limited incomes

8
Important Information For All People With
Medicare

• Medicare prescription drug coverage is available
  to all people with Medicare
  
• There is additional help for those who need it
  most
  
• Medicare prescription drug coverage pays for
  brand-name as well as generic drugs
  
• Look for a Medicare prescription drug plan that
  meets your needs
  
• Medicare prescription drug coverage helps you pay
  for the prescriptions you need

9
Extra Help With Drug Costs

• Available for many people with limited income and
  resources
  
• Those below Federal poverty level save over 95
  on average
  
• People with lowest income and resources
• Pay no premiums or deductibles
• Have small or no copayments
• Those with slightly higher income and resources
• Have a reduced deductible
• Pay a little more out of pocket

10
Eligibility for Extra Help

• Income
• Below 150 Federal poverty level
• 1,197 per month for an individual or
• 1,604 per month for a married couple
• Based on family size
• Resources
• Up to 11,500 (individual)
• Up to 23,000 (married couple)
• Includes 1,500/person funeral or burial
  expenses
  
• Counts savings and stocks
• Does not count home the person lives in
• Higher amounts for Alaska and Hawaii

2005 amounts
11
Automatic Eligibility for Extra Help

• Some people may automatically qualify
• People with Medicare who
• Get full Medicaid benefits
• Get Supplemental Security Income (SSI)
• Get help from Medicaid paying their Medicare
  premiums
  
• All others must apply

12
How to Apply for Extra Help

• Social Security Administration (SSA) is mailing
  applications to those who may be eligible
  
• Throughout the summer of 2005
• Those who think they may qualify should
• Complete this application
• Mail it to the address on the back
• Use the enclosed postage-paid envelope
• Use original forms only (do not photocopy)
• People who are not sure should still apply
• www.socialsecurity.gov can help people decide

13
Extra Help and Other Drug Coverage

• People with other drug coverage
• Should apply for extra help, even if covered by
• Employer or union group health plan
• Indian Health Service
• VA health benefits
• Should ask how Medicare drug coverage with extra
  help will work with the current coverage
  
• Could save money with Medicare prescription drug
  coverage

14
Important Information For All People With
Medicare

• Medicare prescription drug coverage is available
  to all people with Medicare
  
• There is additional help for those who need it
  most
  
• Medicare prescription drug coverage pays for
  brand-name as well as generic drugs
  
• Look for a Medicare prescription drug plan that
  meets your needs
  
• Medicare prescription drug coverage helps you pay
  for the prescriptions you need

15
Which Drugs Are Covered?

• Medicare-covered drugs
• Drugs available only by prescription
• Drugs, biologicals, insulin
• Medical supplies associated with injection of
  insulin
  
• Brand-name and generic drugs
• Drugs not covered
• Drugs excluded by MMA law
• Non-prescription drugs
• Drugs that are covered for a person under
  Medicare Part A or Part B

16
Coverage Varies by Plan

• Plan may not cover all drugs
• Formularies must include more than one drug in
  each classification
  
• Centers for Medicare Medicaid Services (CMS)
  will review formularies
  
• Plan must give 60-day notice of many changes
• Plan must have exception process
• Gives enrollees access to medically necessary
  drugs
  
• Decision can be appealed

17
Important Information For All People With
Medicare

• Medicare prescription drug coverage is available
  to all people with Medicare
  
• There is additional help for those who need it
  most
  
• Medicare prescription drug coverage pays for
  brand-name as well as generic drugs
  
• Look for a Medicare prescription drug plan that
  meets your needs
  
• Medicare prescription drug coverage helps you pay
  for the prescriptions you need

18
Ways to Get Coverage

• Medicare prescription drug coverage is provided
  through
  
• Medicare Prescription Drug Plans
• Medicare Advantage and other Medicare Health
  Plans
  
• Some employers and unions to retirees
• Coverage is NOT automatic
• People need to understand their options

19
Joining a Plan

• Enroll directly with the plan sponsor
• Can get help in enrolling
• Legal representative
• Spouse, other relative, friend, or advocate
• Initial Enrollment Period

20
Late Enrollment

• Most people will have to pay a penalty if they
  wait to enroll
  
• Additional 1 of base premium for every month the
  person was eligible but not enrolled
  
• For as long as the person is enrolled in a
  Medicare prescription drug plan
  
• Unless they have other coverage that, on average,
  is at least as good as Medicare prescription drug
  coverage

21
Coverage on Average at Least as Good as Medicares

• People with other coverage
• Will receive information from the other plan
• Will not pay a penalty if they wait to enroll
• If coverage is at least as good as Medicare
  prescription drug coverage
  
• Possible examples
• Some group health plans (GHP)
• State Pharmacy Assistance Program (SPAP)
• VA coverage
• Military coverage including TRICARE

22
Annual Coordinated Election Period

• November 15 December 31 every year
• Person who does not have a Medicare drug plan can
  enroll
  
• Person who currently has a Medicare drug plan can
  switch
  
• Change effective January 1
• Special Enrollment Period may apply at other
  times in special circumstances

23
Example of Late Enrollment

• Mrs. Jones has Medicare Part A and Part B, and
  she has no prescription drug coverage. She does
  not enroll in a Medicare prescription drug plan
  by May 15, 2006, the end of the Initial
  Enrollment Period.
• When will she have another opportunity to enroll
  in a Medicare prescription drug plan?
  
• What are the consequences of waiting to enroll
  later?

24
Example of Late Enrollment

• When will Mrs. Jones have another opportunity to
  enroll in a Medicare prescription drug plan?
  
• She can enroll during the next Annual Coordinated
  Election Period, November 15 December 31, 2006,
  with coverage effective January 1, 2007.
  
• What are the consequences of waiting to enroll
  later?
  
• Since Mrs. Jones does not have coverage at least
  as good as Medicare drug coverage, she will pay a
  penalty.

25
Medicare Advantage Open Enrollment

• Person can join a Medicare Advantage Plan or
  other Medicare Health Plan
  
• In 2006 January 1 June 30, 2006
• In 2007 and beyond January 1 March 31, each
  year
  
• Change effective the first of the month after the
  month person joined
  

26
Open Enrollment Limit

• During Medicare Advantage Open Enrollment
• Person who has a Medicare plan with prescription
  drug coverage
  
• May only switch to another plan with prescription
  drug coverage
  
• Person who has a Medicare plan without
  prescription drug coverage
  
• May only switch to a plan that does not have drug
  coverage

27
Important Information For All People With
Medicare

• Medicare prescription drug coverage is available
  to all people with Medicare
  
• There is additional help for those who need it
  most
  
• Medicare prescription drug coverage pays for
  brand-name as well as generic drugs
  
• Look for a Medicare prescription drug plan that
  meets your needs
  
• Medicare prescription drug coverage helps you pay
  for the prescriptions you need

28
Things to Consider

• What is current health insurance coverage?
• Original Medicare Plan without drug policy
• Original Medicare Plan with Medigap drug policy
• Medicare and employer/union, including military
• Medicare Advantage and other Medicare Health
  Plans
  
• HMO, PPO, PFFS
• Medicare Cost Plans
• Medicare and Medicaid
• Is there currently prescription drug coverage?
• Even those with current drug coverage should ask
• Is Medicare prescription drug coverage right for
  me?

29
Current Insurance Coverage

• Original Medicare Plan
• Without Drug Coverage or
• With Medigap Drug Policy

Medicare Advantage and Other Medicare Health Plans
Medicare and Medicaid or Other State/Federal
Assistance Programs

• Which box describes the health insurance you have
  now?

Does NOT include doctor samples, discount cards,
Medicare-approved drug discount cards with or
without the 600 credit, free clinics, or drug
discount websites
30
Original Medicare Plan Without Medigap or With M
edigap Plans A - G
I have Original Medicare only, or
Original Medicare and a Medigap (Supplement)
Policy without drug coverage.
31
Original Medicare Plan

• What to do
• Watch the mail this fall for the Medicare You
  handbook
  
• Choices to make
• Join a Medicare Prescription Drug Plan
• Join a Medicare Advantage or other Medicare
  Health Plan with prescription drug coverage
  
• Dont enroll in Medicare prescription drug
  coverage
  
• But you may pay a penalty if you join later

32
Original Medicare Plan and Medigap With Drug Cove
rage
I have Original Medicare and a Medigap
(Supplement) Policy with drug coverage.
33
Original MedicareAnd Medigap With Drug Coverage

• What to do
• Watch the mail this fall for important
  information from the insurance company on Medigap
  coverage
  
• Choices to make
• Keep coverage through the Medigap policy
• Join a Medicare Prescription Drug Plan after you
• Modify the Medigap policy to remove drug
  coverage, or
  
• Change to a Medigap policy with no drug coverage
• Drop Medigap policy and join a Medicare Advantage
  or other Medicare Health Plan with prescription
  drug coverage

34
I am a retiree and I have drug coverage through
my (or my spouses) employer or union.
35
Employer/Union Coverage

• Medicare is working with employers to help people
  with Medicare keep their current coverage
  
• Employer options
• Offer coverage in place of Medicare prescription
  drug coverage and receive a tax-free subsidy
  
• Offer or contract with a Medicare drug plan to
  provide prescription drug coverage
  
• Provide coverage that supplements the Medicare
  prescription drug coverage
  
• Pay all or part of Medicare drug plan premiums

36
Employer/Union Coverage

• What to do
• Watch the mail this fall for important coverage
  information from the plan sponsor
  
• Contact the benefits administrator before you
  make any changes
  
• Choices to make
• Keep coverage offered by employer/union
• Join a Medicare Prescription Drug Plan
• Join a Medicare Advantage or other Medicare
  Health Plan with prescription drug coverage
  
• CAUTION If you drop or lose your employer/union
  coverage, you may not be able to get it back

37
Medicare Advantage and Other Medicare Health Plans
I have a Medicare Advantage Plan (like an HMO or
PPO) or other Medicare Health Plan.
38
Medicare Advantage Plans(HMO, PPO, and PFFS)

• What to do
• Watch for a notice from your plan
• Call the plan for details
• Choices to make
• If plan will offer drug coverage
• Stay in plan and get Medicare prescription drug
  coverage
  
• If plan wont offer drug coverage
• Switch to another Medicare Advantage or other
  Medicare Health Plan with prescription drug
  coverage
  
• Switch to the Original Medicare Plan and join a
  Medicare Prescription Drug Plan
  
• Dont enroll in Medicare prescription drug
  coverage
  
• But you may pay a penalty if you join later

39
Medicare Cost or PACE Plan

• What to do
• Call the plan for details
• Choices to make
• If Cost Plan with drug coverage
• Get Medicare prescription drug coverage from the
  plan or
  
• Join a Medicare Prescription Drug Plan
• If Cost Plan with no drug coverage
• Join a Medicare Prescription Drug Plan
• If PACE plan, will get coverage through that plan

40
Medicare and Medicaid or Other State/Federal
Assistance Programs
I have Medicare and Medicaid, and I get my drug
coverage from Medicaid.
41
Medicare and Medicaid

• What to do
• You automatically qualify for the extra help
• Watch the mail this fall
• Letter about choosing a Medicare prescription
  drug plan
  
• Medicare You 2006 handbook
• Choices to make
• Compare drug plan options and enroll in a plan
• If not, Medicare will enroll you in one by
  December 31, 2005
  
• Starting January 1, 2006, Medicare will pay for
  your prescription drugs
  
• Can switch to another plan at any time

42
Other State/Federal Assistance Programs

• What to do
• You automatically qualify for the extra help if
  you
  
• Get help from Medicaid paying your Medicare
  premiums
  
• Get Medicare and Supplemental Security Income
  (SSI) benefits
  
• Watch the mail for Medicare You 2006 handbook
• Choices to make
• Compare drug plan options
• Find a plan that meets your needs
• If no choice made by May 15, 2006, you will be
  enrolled on June 1, 2006
  
• Also applies to people who applied and qualify
  for extra help
  
• Can switch once to another plan (if you get help
  from Medicaid paying your Medicare premiums, you
  can switch at any time)

43
Special Populations

• State Pharmacy Assistance Program participants
• People in long-term care facilities
• Residents of the U.S. territories

44
State Pharmacy Assistance Programs

• Provide wraparound coverage
• Provide same or better coverage and save money
• Reduce state costs or expand population served
• Costs incurred by SPAP may or may not be counted
  toward out-of-pocket limit

45
Long-Term Care Facilities

• Residents
• Usually obtain drugs from pharmacy chosen by the
  facility
  
• Can change plans at any time
• Will have convenient access
• Those with Medicare and full Medicaid coverage
  have no premiums, deductibles, or copayments

46
U.S. Territories

• Each territory has its own prescription drug plan
  region
  
• Each territory can develop its own extra help
• Help with premiums, coinsurance, copayments,
  deductibles or
  
• Provide supplemental coverage

47
Choosing a Plan

• See Medicare You 2006 handbook
• To be mailed October 2005
• Read about prescription drug plans in the area
• For help in choosing a plan
• Visit www.medicare.gov
• To get personalized information
• Call 1-800-MEDICARE (1-800-633-4227)
• TTY users call 1-877-486-2048
• Call the local State Health Insurance Assistance
  Program
  
• Attend local community events

48
Important Dates

• May 2005
• Medicare mailed notices to people who
  automatically qualify for extra help
  
• Summer 2005
• Social Security Administration mails applications
  to people who may be eligible for the extra help
  
• July 1, 2005
• Social Security application for the extra help
  available online

49
Important Dates

• September 16 November 15, 2005
• Medigap plans with drug coverage mail information
  to policy holders
  
• October 13, 2005
• Begin comparing plans
• www.medicare.gov
• 1-800-MEDICARE (1-800-633-4227)

50
Important Dates

• October 2005
• Medicare You 2006 handbook mailed
• Medicare notifies people with Medicare and
  Medicaid of the plan they will be automatically
  enrolled in on January 1, 2006, if they do not
  enroll on their own
• Employer plans send coverage information to
  enrollees
  
• November 15, 2005
• Initial Enrollment Period begins

51
Important Dates

• January 1, 2006
• Medicare prescription drug plan coverage begins
  for those enrolled
  
• May 15, 2006
• Last day of Initial Enrollment Period
• June 1, 2006
• Facilitated enrollment of people entitled to
  extra help who did not enroll by May 15

52
For More Information

• Websites
• www.medicare.gov
• www.cms.hhs.gov
• www.socialsecurity.gov
• Publications
• Medicare You handbook
• Facts About Medicare Prescription Drug Plans
• 1-800-MEDICARE (1-800-633-4227)
• Social Security Administration
• 1-800-772-1213