Simplified Overview of Medicare Part D from HIICAP
Part D is the Prescription Drug Benefit offered to those enrolled in or eligible for Medicare Part A and/or B. People need to consider a variety of factors before selecting a plan under Part D. Here is some information to help with the choice:
- Annual open enrollment starts October 15, and ends December 7, 2012. Enrollment is optional and voluntary.
- Individuals who currently have drug coverage through an employer, union, or other source may decide to keep that coverage rather than enrolling in Part D. However, this insurance must be deemed as "creditable". Creditable coverage means prescription drug coverage which is equal to or better than the standard Medicare Part D benefit. The insured will receive a letter to this effect. This letter should be kept in a secure place.
- Those who do not have "creditable" coverage from another plan and choose not to enroll when eligible will have to pay a 1% per month surcharge over the standard national premium for each month they did not have Part D, should they decide later they wish to obtain the benefit.
What is the best way to select a plan?
Unlike Medicare Part A and B which can be used nearly everywhere in the US, Medicare Part D plans are administered by private companies across the nation. Each company may cover different drugs, have different premiums, may be used at only specific pharmacies, and may be used only in specific regions. It's likely that, if you use numerous prescriptions, you might not find a single drug plan that covers all the drugs you use. In that case, you must either change your prescriptions to ones your plan covers, or pay for uncovered drugs out of your own pocket. A list of 2013 Stand Alone Prescription Drug Plans for New York State is here. On-line help is available so you can pick the best plan to cover the greatest portion of your prescriptions. Help is also available through Medicare by phone at 1-800-MEDICARE, or in person through Erie County Senior Services Health Insurance Information Counseling and Assistance Program (HIICAP) at 858-7883.
How does Medicare Part D work?
Under the Standard Benefit in 2013, beneficiaries are responsible for paying a monthly premium to the company they choose, either directly to the company, or by having the premium deducted from their monthly Social Security check. The prescription coverage works as follows:
- First year of prescriptions, you pay the full price. ("deductible") $325
- From then on in prescriptions, you pay 25% and Medicare pays 75%. $325-$2,970
- From $2,970 - until you spend $4,750 in total prescription costs - no coverage, then you have a 5% co-insurance for the cost of each drug or $2.65 for generic medications or $6.60 for brand name, whichever is greater.
However, there is a special provision called Extra Help. Those people with monthly income less than $1,396 individual/$1,891 per couple may qualify. There is a resource cap of $13,070 for individuals and $26,120 for couples. Call the HIICAP hotline at 858-7883 for information.
Medicare beneficiaries are in many different types of decision making situations. Here are some possible scenarios and ideas of how they may be approached. If a beneficiary has:
- Original Medicare as primary insurance (with no prescription coverage): Review the Part D plans and consider whether to purchase and retain Medicare as primary, or to join a Medicare health plan with drug coverage. (See next bullet).
- Medicare Health Plan: (known as Medicare Advantage, HMO, PPO, and Private Fee-For-Service and Medicare Health Savings Accounts HSA), may offer drug coverage. It is necessary to obtain details from the provider in order to determine whether coverage is offered. You can remain in the same plan, switch to another, or add drug coverage to the existing plan.
- Medigap policy with drug coverage: compare current plan with the new Part D plans. The new coverage is likely to be a better value.
- Medigap policy without drug coverage: evaluate Part D plans and choose best coverage for you.
- Medicaid: Most prescription costs are covered by Medicare Part D instead. Recipients will not have to pay a premium and will have no deductible. Most will have co-payments of $1.10 for generics and $3.30 for brand names. It is necessary to compare the plan options and enroll - if a beneficiary does not enroll by Jan. 1, a plan will be assigned, and it is possible it might not cover the recipient's medications
- EPIC: EPIC enrollees will be required to have Medicare Part D coverage. For further information, call EPIC at 1-800-332-3742 or our Health Insurance Information Counseling Assistance Program at 716-858-7883.
- QMB or SLMB or QI: These programs require a participant to meet certain income and/or resource guidelines and to submit an application. Those who qualify are eligible for assistance in payment of Part D premiums and/or deductibles. Generic drugs will be $2.65 and brand names will be $6.60. For more information about these programs, call Erie County Department of Senior Services at 858-8526.
In order to select the plan that is best for you, and to evaluate your options, your first step is to prepare an itemized list of all the medications you take, including the dosage. Then you can call HIICAP volunteers at 858-7883 for assistance, or the Medicare Part D Hotline at 1-800-MEDICARE. More information can be found on this page of the website or at www.medicare.gov. Information and help are available in making the important choice of a Medicare Part D plan.
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