Welcome to part two of our special report on Medicare Part D. By now you have seen the ads, read the stories, memorized the toll-free phone number and perhaps even talked to a live person from the Centers for Medicare & Medicaid Services. What you still may not know is which plan is best for you. You are not alone.
We hope the information here, some of it repeated from a special edition of Seniority, plus updated reports and analysis, enrollment tips and stories from other seniors navigating the system, will assist you as you do your research. The important thing to remember is that you do have time to sign up. Don't let anyone pressure you into a quick decision. Ask as many questions as it takes. Talk to friends about their choices. It's your health and your money, so use caution. Finally, keep this guide handy for reference.
- Sheila Reed, Seniority Editor
Q&A: Medicare Part D
What is Medicare Part D?
People on Medicare can now determine their health coverage for 2006 - whether they receive care through Medicare's traditional Parts A and B or through a Medicare HMO or PPO. For the first time, people on Parts A and B can also add a Part D drug benefit to help pay their prescription bills. To get Part D coverage, you must sign up with one of 19 private insurance companies offering 43 plans in Florida.
When does Part D drug coverage begin?
Coverage starts Jan. 1 if you have signed up by the end of this year. You can also sign up between Jan. 1 and May 15, but the drug plan will not defray your costs until you have signed up.
How do Part D drug plans work?
The insurance company negotiates discounts from pharmacies, usually at a below-retail price. You will pay a monthly premium to the company and receive a drug plan card to show your pharmacist when you fill prescriptions. The company will charge you an annual deductible, if any, and copayments. Medicare will reduce these costs by subsidizing the company for serving you.
How much do plans cost?
Your costs will vary widely from plan to plan. Premiums in Florida range from $10.95 to $104.89 a month, deductibles from $0 to $250 a year. Often coverage ceases when total drug costs hit $2,250, then begins again when total costs hit $5,100. Copayments can range from $0 for a 30-day generic to $75 for a brand-name drug. Total costs are what you and the drug plan pay the pharmacist for drugs on the plan's formulary. There is no free lunch. Plans with broader coverage charge higher premiums.
How do HMOs fit in all this?
If you want to get your hospital and doctor care through a Medicare HMO or PPO, it will also provide your drug coverage, and usually more cheaply than traditional with Medicare. Part D drug plans only accompany Medicare's traditional Parts A and B, where you pick your own doctors and hospitals. Warning: You can't have both a Medicare HMO and a Part D drug plan. If you sign up for both, Medicare will disenroll you from the HMO and put you on traditional Medicare Parts A and B. Some companies, like Humana, Blue Cross-Blue Shield and WellCare offer both HMOs and Part D plans so be careful what you sign up for.
I'm healthy. Must I get drug coverage?
No. Just like Part B doctor coverage, the new Part D drug coverage is optional. However, if you reject coverage now, Medicare will charge a penalty if you change your mind later. Monthly premiums will rise 1 percent for each month you reject coverage. If you have no drug coverage now, it's probably wise to enroll in Part D. You can join a plan for as little as $10.95 a month. For that, you get coverage if you suddenly become sick and you avoid premium penalties later in life, when you are taking drugs.
What if I can't afford the premiums?
If you qualify for Medicare and already receive drugs through Medicaid or state assistance programs, you will automatically be enrolled in a Part D drug plan without having to pay premiums or large copayments. As of Jan. 1, Medicaid will no longer provide drugs to people who also qualify for Medicare. Even if you are not on Medicaid, you might qualify for reductions on premiums, deductibles and copayments if your income falls below $14,356 ($19,246 for a couple) and you don't own a lot of liquid assets such as savings, CDs and stocks. Some income is not counted, so if you are anywhere close to qualifying, check with Social Security toll-free at 1-800-772-1213.
How do I sign up?
If you want to join an HMO or PPO, contact them directly. If you want to add a Part D drug plan to traditional Medicare Parts A and B, you can contact the private drug plan directly or sign up online at www.medicare.gov or by calling toll-free 1-800-MEDICARE 1-800-633-4227.
How do I pick a plan that is right for me?
The Medicare & You 2006 booklet that Medicare recently sent you lists information about drug plans and company phone numbers. The people who answer 1-800-MEDICARE can give give a list of the three cheapest plans based on your medications. Or you can research that directly at www.medicare.gov Florida's SHINE program can give one-on-one advice if you call toll-free 1-800-963-5337. Expect to leave a message, but a SHINE volunteer will call you back. Information on drug plans is also available on www.sptimes.com/medicare
Can I switch plans after I choose one?
People on Medicare who have chosen a drug plan can switch it one time between Jan. 1 and May 15, but then are locked into the choice for the rest of 2006. (Medicare beneficiaries who are also on Medicaid can switch plans once a month.)
What are the pitfalls?
If you take very many medications, be wary of picking the plan with the lowest premium. You often can save money by paying more for broader coverage. Make sure the company includes your drugs on its formulary and will let you use the pharmacy of your choice. Many plans require prior authorization, step therapy or restrict prescription quantities for some drugs. Ask each company if they restrict your drugs and how. Consider paying a slightly higher premium for a plan with fewer restrictions on your specific drugs. If someone with a computer helps you pick a drug plan, ask them to check Medicare's "Formulary Finder" to see how a plan might restrict your drugs.
What if I get drug benefits from my ex-employer's or union's retiree health plan?
Retiree plans offered by employers and unions are often cheaper than Part D plans. You probably should keep these retiree benefits as long as Medicare deems them "creditable coverage." If so, you can always switch to a Medicare Part D plan later without paying any penalty. Ask your ex-employer or union whether your retiree plan qualifies as "creditable." If it isn't, you probably should switch to a Medicare HMO or a Part D drug plan to avoid paying a premium penalty later on.
Will manufacturers still offer free drugs?
Many "patient assistance" programs for low-income people will end Jan. 1. If you rely on one of them, contact the manufacturer for details.
