Day 4 Medicare Prescription Drug Program (Part D)

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Day 4Medicare Prescription Drug Program (Part D)
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Review
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Medicare

• For people 65 and under 65 with a disability
• 4 parts of Medicare
• Part A Hospital Insurance
• Part B Medical Insurance
• Part C Medicare Advantage Plans
• Part D Prescription Drug Coverage
• Part A B called Original Medicare
• Automatic enrollment if getting SS benefits, must
  enroll if not
• Premiums always for Part B, only for A if not
  enough credits
• Not comprehensive coverage, has coverage gaps
• Out-of-pocket costs for A B change yearly- see
  chart

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Medicare

• Pays for reasonable and medically necessary
  services
• There are coverage gaps in Medicare including
• Part A in-patient hospital deductible
• Part A daily co-payment for in-patient hospital
  days 61-90
• Part A daily co-payment for in-patient hospital
  days 91-150
• Part A daily co-payment for SNF days 21-100
• Part B annual deductible
• Part B co-insurance (usually 20)
• First three pints of blood
• Coverage outside the United States

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Medicare Advantage

• Option for supplementing Original Medicare
• Offered by a private company that contracts with
  Medicare to provide a beneficiary with their Part
  A B benefits
• One way for a beneficiary to get additional
  Medicare coverage to cover the gaps in Original
  Medicare
• The plan must offer Part D drug coverage
  members who want drug coverage may only take drug
  plan offered by the Medicare Advantage plan
• If enroll in stand alone PDP, will be
  dis-enrolled from Part C and returned to Original
  Medicare
• Different plan types available
• HMO, HMO-POS, PPO, SNP, PFFS

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Medigap

• Option for supplementing Original Medicare
• Offers coverage to fill gaps in Original Medicare
• Offered by private insurance companies, not the
  federal government
• Prescription coverage NOT included if a
  beneficiary wants prescription drug coverage,
  they must join a Medicare Prescription Drug Plan
• A Medigap policy is different from a MA plan MA
  plans are ways to get Medicare benefits. A
  Medigap policy acts as a secondary policy to
  cover the costs of Original Medicare benefits

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Two Options For Supplementing Medicare
Step 1 Decide how you want to get your coverage
ORIGINAL MEDICARE
MEDICARE ADVANTAGE PLAN
OR
PART B Medical Insurance
PART A Hospital Insurance
PART C Combines Part A, Part B and usually Part D

Step 2 Decide if you need a Prescription Drug
Plan
PART D Stand Alone PDP
PART D Included in Part C
Step 3 Decide if you need to add supplemental
medical coverage
END If you join a Medicare Advantage Plan with
drug coverage (MAPD), you cannot join another
drug plan and you dont need and cannot be sold a
Medigap policy
MEDIGAP Supplement Core or Supplement 1 plan
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Medicare Prescription Drug Program (Part D)
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Part D Overview

• Medicare offers prescription drug coverage to
  everyone with Medicare
• Provides outpatient prescription drug coverage
• Beneficiaries with Part A and/or Part B are
  eligible
• 2 ways to get prescription coverage
• 1. Medicare Prescription Drug Plans (PDPs) also
  known as stand alone plans
• 2. Medicare Advantage (Part C) Plans with drug
  coverage
• Part D is voluntary, but eligible beneficiaries
  who do not enroll may be subject to a penalty

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Part D Plans

• May differ on many levels but must meet both
  pharmacy access and formulary standards set by
  CMS
• PDPs and MA-PDs may vary based on
• Benefit Design
• Monthly Premium
• Co-payments
• Formulary
• Drug Prices
• Pharmacy Network
• All plans must offer the standard prescription
  drug benefit or its equivalent. The plans may
  choose to offer supplemental benefits for an
  extra premium

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Formulary

• The prescription benefit includes a list of
  covered drugs and this list is called the
  formulary
• If the insurer is very selective about which
  drugs are to be covered, then it is sometimes
  referred to as a closed formulary. If the
  formulary is open to all drugs but places drugs
  into different cost sharing categories or
  tiers, it is referred to as an open formulary
• Each plan must meet formulary standards. The
  formulary must include and cover certain drugs or
  certain classes of drugs. Medicare has
  established a category of excluded drugs

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Examples of Part D Excluded Drugs

• Drugs for anorexia, weight loss or weight gain
• Drugs for the symptomatic relief of cough and
  colds
• Prescription vitamins and mineral products,
  except prenatal vitamins and fluoride
  preparations
• Non-prescription drugs (over the counter)
• Drugs that could be covered under Medicare Part A
  and/or Medicare Part B

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Appeals to Formulary

• Beneficiaries can take the following steps when a
  drug they are taking is not covered under the
  formulary
• Ask prescriber if she/he meets prior
  authorization or step therapy requirements or if
  there are generic, over-the-counter or less
  expensive brand name drugs
• Request a coverage determination (including an
  exception) that the plan cover the drug
• Try to find a SEP in order to switch Part D plans
  to one that has a formulary that covers all of
  the drugs

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Prior Authorization

• Many insurers will provide access to a particular
  drug only after the physician requests approval
  explicitly for that drug for the patient
• One reason for requiring prior authorization is
  that it is a means to make sure the doctor has
  considered the use of less expensive alternatives
  before requesting the particular drug that
  requires prior approval
• This is a very popular cost management technique
  used with many drugs on many Medicare Part D plans

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Generic Vs. Brand Name Drugs

• Massachusetts is a generic-mandated state in
  which all pharmacists have to dispense generic if
  available unless the physician indicates no
  substitution
• Generic drugs contain the same active
  ingredients, have the same strength and dosage as
  the brand name drug and must meet the same
  government quality control standards

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Four Enrollments Periods

• Initial Enrollment Period (IEP)
• Open Enrollment Period (OEP)
• Special Enrollment Period (SEP)
• Medicare Advantage Disenrollment Period (MADP)

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Initial Enrollment Period

• 65 Mimics that of Medicare Part B (7 month
  period)
• Under 65 Mimics that of Medicare Part B
  beneficiaries who become eligible for Medicare
  due to a disability can join during period 3
  months before through 3 months after 25th month
  of cash disability payments
• MassHealth members When eligible for Medicare,
  primary prescription coverage under MassHealth
  ends. MassHealth notifies Medicare of members
  dual status and individual has 60 days to enroll
  in Part D plan or will be auto-enrolled in a plan
  chosen at random

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Open Enrollment Period

• October 15th - December 7th, coverage effective
  January 1st
• During this period beneficiaries can
• Join a plan for the first time (If late enrollee,
  would be subject to late enrollment penalty)
• Switch plans (including changing MA plans)
• Drop a plan
• To switch a plan
• Simply enroll in new plan. No need to cancel old
  Medicare drug plan as the coverage will end when
  the new drug plan begins

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Special Enrollment Period

• Certain conditions make beneficiaries eligible
  for a SEP during which they can enroll in a Part
  D plan outside of the initial enrollment period.
  They include
• Moving out of their plans service area
• Loss of creditable coverage
• Having dual eligible status (enrolled in
  MassHealth Medicare or enrolled in a Medicare
  Savings program)
• Being a member of Prescription Advantage (a State
  Prescription Assistance Program known as a SPAP)
• Switching to a 5-star rated plan beneficiary
  can make one switch at any time during the year
  to a 5-star rated plan

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Medicare Advantage Disenrollment Period

• January 1st February 14th
• During this period, beneficiary CAN
• Dis-enroll from a MA plan and return to original
  Medicare and enroll in a stand-alone Medicare
  Prescription Drug Plan (PDP)
• Dis-enroll from a MA plan without drug coverage
  and enroll in a PDP. May be subject to a late
  enrollment penalty
• During this period, beneficiary CANNOT
• Switch from Original Medicare to a MA plan
• Switch from one MA plan to another
• Switch from one Medicare Prescription Drug plan
  to another

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Late Enrollment

• If a Medicare beneficiary does not join a
  Medicare Prescription Drug Plan when first
  eligible and didnt have other creditable
  prescription drug coverage that met Medicares
  minimum standards, they could incur a late
  enrollment penalty
• All Medicare beneficiaries (including those who
  are still working) must have creditable coverage
  to avoid the late enrollment penalty

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Creditable Coverage

• Coverage that is at least as good as Medicare
  Part D
• Protects a beneficiary from the Part D penalty
• Employer or retiree coverage, union coverage, VA
  coverage Need proof of coverage to avoid penalty
• Beneficiaries still working
• Benefits administrator has information about
  whether the employer coverage is creditable
• Beneficiaries should be encouraged to ask the
  benefits administrator about their creditable
  coverage status if they have not been notified

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Late Enrollment Penalty

• Penalty is 1 of the national base beneficiary
  premium for EACH MONTH the beneficiary
• Did not enroll in a Medicare PDP when they were
  first eligible AND
• Had no prescription drug coverage
• OR
• Had coverage that was not considered creditable
• OR
• Had a lapse in creditable coverage of 2 full
  months (63 days)

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Late Enrollment Penalty

• The penalty is added to the premium at the time
  of enrollment and is a lifetime penalty except
  for
• A beneficiary under age 65 who is enrolled in
  Part D and subject to a late enrollment penalty
  will have the penalty waived at age 65
• This waiver mirrors the clean slate provided to
  Medicare enrollees subject to a Part B penalty
  prior to turning age 65
• Beneficiaries enrolled in Extra Help will have
  the penalty paid for by Extra Help. If the
  beneficiary loses her/his Extra Help, she/he
  would need to pay the Part D penalty

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Supplement 2 (aka Medex Gold)

• Considered creditable coverage
• No penalty if beneficiary eventually joins a Part
  D plan
• Beneficiary can join during a Part D plan during
  the Open Enrollment Period or if they qualify for
  a Special Enrollment Period
• Dis-enrolling from the plan is NOT in of itself a
  SEP

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Part D Costs

• Must pay monthly premium to the plan which
  includes an annual deductible that may change
  annually
• Those with a Medicare Advantage Pan with drug
  coverage pay a monthly premium to the plan that
  includes the premium for their health care
  coverage and their Part D coverage
• Premiums indexed according to income (same as
  Part B)
• Premium can be deducted directly from Social
  Security check
• Deductible amount changes yearly and varies from
  plan to plan

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Co-payment VS. Co-insurance

• Co-payments Set dollar amount that is paid at
  the pharmacy, e.g., 8 for a 30-day supply at a
  retail pharmacy. Usually, generic drugs have
  lower co-pays than brand drugs
• Co-insurance Percentage of the retail cost,
  e.g., 25 for a 30-day supply. This is the
  amount the beneficiary would be required to pay

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2014 Standard Medicare Part D
Level Description
Deductible Annual deductible paid by the Beneficiary 310.00 max
Initial Coverage After deductible, beneficiary pays 25 of the drug costs and Medicare pays 75 Initial coverage limit is 2,850
Coverage Gap Donut Hole Begins once initial coverage limit is reached Beneficiary pays percentage of the cost for brand name (47.5) and generic drugs (72) Beneficiarys out of pocket reaches 4,550 catastrophic
Catastrophic Begins when catastrophic limit is reached Beneficiary pays 5 of the drug costs and Medicare pays 95
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ACA Closing the Coverage Gap

• The Affordable Care Act reduces the costs to
  beneficiaries who reach the coverage gap.
  Effective January 2011 beneficiaries receive
  discounts on both brand and generic drugs in the
  gap. These discounts will increase each year
  until the coverage gap is eliminated in 2020

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Enrolling into Part D

• Review plan options
• Plan Finder Tool on www.medicare.gov
• Determine PDP plan vs. MA-PD plan
• Consider cost, coverage, quality, and convenience
• Try to avoid drug restrictions using
• Step Therapy
• Prior Authorizations
• Quantity Limitations
• Contact plan directly or call 1-800-Medicare
• Enrollment can take place on the phone, online,
  or through a mailed in paper application

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Extra Help /Limited Income SubsidyPrescripti
on Advantage
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Extra Help/Low Income Subsidy (LIS)

• Extra Help is a federal assistance program to
  help low-income and low-asset Medicare
  beneficiaries with costs related to Medicare Part
  D
• Extra Help subsidizes
• Premiums
• Deductibles
• Copayments
• Coverage Gap Donut Hole
• Late Enrollment Penalty
• Does NOT subsidize non-formulary or excluded
  medications
• Apply through Social Security Administration

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2 Levels of Extra Help

• Full Extra Help
• 135 of the Federal Poverty Level (FPL) and asset
  limits
• Full premium assistance with no deductible
• Low, capped co-payments. Could be 0 for some
  generics at any level
• Partial Extra Help
• 150 of the FPL and asset limits
• Reduced premiums (sliding scale between 25
  -75 assistance dependent upon income)
• Reduced deductible and 15 co-payments

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Extra Help Eligibility

• Resources counted
• Bank accounts (checking, savings, CDs)
• Stock, bonds, savings bonds, mutual funds, IRAs
• Real estate other than a primary home
• Resources NOT counted
• Primary home, car
• Property one needs for self-support, such as a
  rental property (rent payments are considered as
  income)
• Burial spaces owned by a beneficiary
• Personal belongings

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Dual Eligibles

• Medicare beneficiaries who are also enrolled in
  Medicaid/MassHealth, Supplemental Security Income
  (SSI) or a Medicare Savings Program/MassHealth
  Buy-in) are known as dual eligibles
• These beneficiaries do not have to apply for
  Extra Help as they are deemed eligible and will
  be enrolled automatically

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Extra Help Coverage Period

• If an individual loses their Extra Help coverage
  due to no longer meeting the eligibility
  requirement, the end of the benefit coverage will
  depend upon when the individual loses their Extra
  Help coverage
• If the Extra Help benefit is lost PRIOR to July
  Coverage will end by December 31st of that SAME
  year
• If the Extra Help benefit is lost AFTER July
  Coverage will end by December 31st of the
  FOLLOWING year

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Prescription Advantage

• Massachusetts State Pharmacy Assistance Program
  (SPAP)
• Provides secondary coverage for those with
  Medicare or other creditable drug coverage
  (i.e. retiree plan)
• Benefits are based on a sliding income scale only
  no asset limit!
• Level of assistance provided is determined by
  gross income
• Different income limits for under 65 and 65 and
  over

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Benefits for Individuals on Medicare or With
Creditable Coverage

• Helps pay for drugs in the gap (for most members)
• May help pay all or part of the Medicare
  prescription drug plan's drug co-pays (All
  medications must be covered by primary plan)
• Those in top income category (S5) must pay 200
  annual fee for limited benefits
• Members are provided a SEP (one extra time each
  year outside of open enrollment to enroll or
  switch plans)
• Prescription Advantage does NOT pay the late
  enrollment penalty fee

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Benefits for Individuals NOT on Medicare

• Offers members who do not qualify for Medicare,
  primary prescription drug coverage
• Coverage has no monthly premium
• Depending on income, members will pay a co-pay
  for prescription drugs and will have an annual
  out-of-pocket spending limit and quarterly
  deductible. Once annual out-of-pocket limit is
  reached, Prescription Advantage will cover drug
  co-pays for the remainder of the plan year
• Members are provided a SEP (one extra time each
  year outside of open enrollment to enroll or
  switch plans)

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Part D Review

• Review
• What is Medicare Part D and how is it offered?
• Who is eligible?
• What is creditable coverage?
• How is the late enrollment penalty calculated?
• When is the Open Enrollment Period?
• When does the coverage gap or donut hole begin?
• What programs are available to reduce drug costs?

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Part D Quiz

• 1. Late enrollees in Part D will face a penalty
  of
• a) 10 per year c) 1 per month
• b) 5 per year d) l0 per month
• 2. To meet the out-of-pocket requirement for
  catastrophic coverage Part D enrollees can
  (select all that are correct)
• a) Pay for their drugs themselves c) Buy drugs
  
  from Canada
• b) Use Prescription Advantage d) Get family
  members to help
• 3. Define creditable coverage
• 4. Why is it important that a beneficiary know if
  she/he has creditable coverage?

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Part D Quiz, cont.

• 5. What does the Low Income Subsidy (LIS) help
  pay for?
• 6. Who is eligible to receive LIS?
• 7. Who must apply and who is deemed eligible?
• 8. Minnie Sota meets with you at the SHINE
  office. She read about Part D and is not sure if
  she needs it. She will be retiring and will have
  a retiree plan from her employer with
  prescription coverage. How would you assist
  Minnie with her decision?
• 9. Pat E. Cake meets with you on November 20th.
  She says she belongs to a Medicare Advantage
  Plan. She tells you the prescription drug plan
  with her MA costs more than she wants to pay, so
  she has decided to take the Part D plan offered
  by the agent she met at CVS. How would you assist
  her?

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Case Study 1Ann Apolis

• Ann is very distraught about the Medicare Part D
  program. She currently has Medicare A B and a
  retiree Medicare supplement plan through her
  former employer. She is very happy with her
  retiree plan. It provides coverage for all the
  deductibles and copays under Medicare and also
  provides unlimited drug coverage with 5-15
  co-pays for a 90-day supply of her medications.
  Her monthly premium for the retiree plan is
  145.00. Her friend told her that she should have
  joined the Medicare Part D program during the
  initial open enrollment. The friend also told her
  she will face a penalty if the retiree plan
  should stop providing coverage and she wants to
  join Part D in the future.
• How would you help her?

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Case Study 2Mel O. Dee

• Mel is assisting his mom who has finally decided
  to retire at age 72. His mom visited her local
  Social Security office and signed up for Medicare
  B. (She signed up for A when she turned 65.) He
  understands that she also needs to sign up for a
  Part D plan. His mom takes few meds and he thinks
  her drug costs are not more than a few hundred
  dollars/year. Mel heard that Part D plans are
  expensive and dont cover many meds. He has no
  idea how to go about helping her to choose a plan
  or whether she really needs one. He is concerned
  about the costs for Part D along with any other
  insurance/ care costs since her only income will
  be SS of 15,000/year. She owns her own home and
  has about 15,000 in assets and a 10,000 life
  insurance policy.
• How would you help him?

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Case Study 3Manny Phestacion

• Manny meets with you at the SHINE office. He is
  66 years old and still working full-time. Manny
  is covered by his group health plan. He enrolled
  in Medicare Part A when he turned 65. Manny
  understands that he does not need to enroll in
  Medicare Part B or a Medicare Prescription Drug
  Plan (Part D) until he stops working. He thinks
  he can enroll when he retires and will not have
  to pay a late penalty.
• Is he correct?

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Case Study 4Jean E. Ology

• Jean comes to see you at the SHINE office after
  previously reviewing her options with you over
  the phone. She is retiring in 2 months and wants
  to get your assurance that the options she chose
  will work. Jean takes 3 medications two are
  generic and relatively inexpensive and one is an
  expensive brand. After hearing about the Part D
  program, she has decided to go with a Medicare
  Advantage (Medicare HMO) plan and join a Medicare
  Prescription Drug Plan (Part D) that provides
  coverage for generics during the gap (donut
  hole).
• How would you help her?

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Case Study 5Bud Jet

• Bud meets with you at the SHINE office. Bud just
  retired last month. He has Medicare A B and a
  retiree Medicare supplement plan from his former
  employer. He received a notice from his former
  employer that his drug plan coverage is not as
  good as the Medicare Part D drug coverage. His
  understanding is that he can stay with his
  employer plan or join Medicare Part D. After
  comparing the cost of his retiree plan with the
  Medicare Part D plan, he decided to stay with his
  employer plan as it fully meets his prescription
  needs and is less expensive.
• How would you help him?

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Case Study 6 Phil S. Steen

• Phil meets with you at the SHINE office. He tells
  you he has Blue Cross/Blue Shield Supplement 1.
  He is also a member of Prescription Advantage. He
  has a Part D plan which had been working fine.
  However, his doctor just gave him a new
  medication that he discovered is not on the
  formulary of his plan. Its an expensive
  medication, and he cant afford to continue
  filling it.
• How would you help him?

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Case Study 7Will U. Help

• Mr. Help will be eligible for Medicare in 2
  months and has already visited his local SS
  office to sign up for Medicare. The woman he met
  with at SS told him about Medicare A and B and
  also told him he must sign up for a Medicare
  Prescription Drug plan. He explained to her that
  he is a veteran and gets his prescriptions
  through the VA. She said that didnt matter. He
  still needs to sign up or face a penalty. He
  tells you his income is a Social Security check
  for 1100/month and a pension of 200/month. He
  thought Medicare AB and the VA would be all that
  he would need. He is worried about the Part D
  penalty and wants to know if you can help him
  figure out what Part D plan to join.
• How would you help Mr. Help?

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• Question for Medicare
• I will be turning 65 this November. I plan to
  continue working until age 67 and will be covered
  by my employer health insurance. I will enroll in
  Medicare A when I turn 65 but wont pick up B D
  until I retire. I know that I have 8 months from
  termination of coverage under my active
  employment to pick up Part B. Is this also true
  for D? I will not face a penalty for not joining
  Part D as long as Im covered under my employer
  plan while still actively working. Is that
  correct?