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Getting What You Need from the Medicare Prescription Plan
by Mary Hart, RRT, AE-C
Today, with the winds of change coming to health care in America, Medicare beneficiaries are probably wondering what they will do to keep getting their prescriptions and what resources are available. As of Spring 2009 (right now Congress is debating universal health care), here is a primer on what Medicare beneficiaries need to know about Medicare Part D prescription drug coverage.
Medicare was created by the U.S. government in 1965 to provide health insurance for people 65 years of age and older, disabled people under the age of 65, and people with end-stage renal disease. It was created for catastrophic medical coverage and medications, not as an integral part of all medical treatments at that time.
A brief look at Medicare:
- Part A pays for hospitalizations.
- Part B, an optional program, patient pays for physician visits and other outpatient services through premiums.
- Part C, also optional, are Medicare-sponsored managed care plans known as Medicare Advantage Plans. Part C combines Parts A and B together in a preferred provider organization or health maintenance organization. Most Part C plans cover prescription medications, which the patient pays for through premiums.
Medicare Part D (Prescription Drug Coverage):
- Created by Congress in 2003
- Called the “Medicare Modernization Act”
- Provides prescription coverage for medically necessary drugs
- Managed by private insurers
- On Jan. 1, 2006, more than 43 million people were granted access to outpatient prescription coverage.
Before looking into the Medicare Part D information, think about your experiences with your doctor and respiratory therapist, especially if you have frustration and fear of being unable to afford your medications. Many of you may be wondering: Do I buy my blood pressure medicine or lung medication? Do I buy groceries or medications?
Ways to get Part D coverage:
- Choose a prescription drug plan that adds drug coverage and can be used with traditional and/or Medicare supplement plans.
- Combine a prescription drug plan with a Medicare Advantage Plan that includes medical coverage and hospital plans much like an HMO (Medicare Part C).
Cost for Medicare Part D:
- Monthly premium depends on plan and formulary.
- Less restrictive formulary equals a more costly monthly premium.
- Can be deducted from your Social Security check, automatically deducted from a savings or checking account, or charged to a credit or debit card.
- Some plans have a yearly medication-only deductible (pay out of pocket for all medications until limit is reached before benefit kicks in).
2009 yearly income and resource limits:
- Single individuals with an income less than $14,700 and resources less than $11,500 qualify for “extra help.”
- Married individuals (living with spouse) with an income less than $19,800 and resources less than $23,000 qualify for “extra help.”
- Some individuals automatically qualify for extra help, and Medicare will automatically enroll them in its “extra help” program.
- Those who are not automatically enrolled and think they might qualify can apply for extra help to the U.S. Social Security Administration (visit your local SS office).
The gap, or “donut hole”
After you have spent a predetermined amount of money on Medicare-covered medications, you are required to pay all the costs for your medications up to a maximum dollar amount. This is called the “gap” or “donut hole.” Once the maximum gap cost accrues, you become eligible for “catastrophic coverage,” meaning you would pay a co-insurance (5% of the medication cost) or $5–$6 for each prescription for the rest of the calendar year. If you have a low income and are enrolled in the “extra help” program, you will not have a coverage gap; the monthly premium continues to be paid throughout the year.
People with Medicare who have limited income and resources may qualify for extra help paying for their prescription drugs. Those who qualify could pay between $1–$5 for each drug.
You can contact Social Security by visiting Social Security or by calling (800) 772-1213. TTY users should call (800) 325-0778. For additional information, patients can review Bridging the Coverage Gap (PDF 132.71).
Four ways to save on costs while in the coverage gap
- Switch to generics—Talk with your physician about the drugs you are currently taking to find out if there are generic or less expensive brand-name drugs that would work just as well. Cost-saving information through the use of mail-order pharmacies, generic, or less expensive brand-name drugs is also available in the Prescription Drug Plan Finder Section.
- Explore charitable programs—National and community-based charitable programs (e.g., National Patient Advocate Foundation or the National Organization for Rare Disorders) may have programs that can help you with your drug costs. Information on programs in your area is available on the Benefits CheckUp web site of Medicare.
- Look into drug assistance programs—Many of the major pharmaceutical manufacturers are offering assistance programs for people enrolled in Medicare Part D. You can find out whether a patient-assistance program is offered by the manufacturers of the drugs you take by visiting Medicare’s Pharmaceutical Assistance Program.
- Ask about state pharmaceutical assistance programs—There are also 21 states and one U.S. territory offering help with paying drug plan premiums and/or other drug costs. You can find out if your state has a program by visiting Medicare’s State Pharmaceutical Assistance Program.
Part D coverage general information:
- Formularies are approved by Medicare and are available for review by contacting each individual plan or searching the Web.
- Plans may change their formulary when new or better medications are available.
- Plans must contact the beneficiary and pharmacy 60 days prior to changing the preferred medication.
- Nebulized medications, select inhaled medications, and diabetic testing supplies are still covered by Medicare Part B.
- There may be limits on the choices of pharmacies you may use.
- Some plans offer mail order services usually for lower co-pays/coinsurance.
- If you live in different regions of the country during different times of the year, you should select a plan offered in both regions or opt for a plan with mail order pharmacy services that will ship to them.
- Enrolling in a plan will protect Medicare beneficiaries against higher medication costs and premiums in the future.
- Open enrollment takes place every year from Nov. 15 through Dec. 31. During this time you have an opportunity to switch plans or enroll in Medicare prescription drug plans.
- After enrolling during open enrollment, prescription coverage begins Jan. 1 of the following year. You will remain in that plan for the full year.
- If you did not enroll in the Part D program prior to May 15, 2006, you can enroll during open enrollment but will be penalized for waiting. The penalty amount will be applied to your monthly premium as long as you have Medicare prescription coverage.
In most cases, you must stay enrolled for that calendar year starting the date your coverage begins. However, in certain situations, you may be able to join, switch, or drop a Medicare Advantage Plan at other times. Some of these situations include:
- If you move out of your plan’s service area
- If you have both Medicare and Medicaid
- If you qualify for “extra help”
- If you live in an institution.
You can call your State Health Insurance Assistance Program (SHIP) for more information.
Exceptions to open enrollment:
- If you move to a region where your Part D plan is not offered
- If you move to a nursing home where your Part D coverage is not available
- If the drug plan is no longer offered.
Medicare made changes in Part D 2008-2009:
- For this year, Medicare offered new tools on the Plan Finder page of its web site.
- Medicare added report cards that rate plans based on a range of factors, (e.g., customer service, drug pricing, ease of filling prescriptions).
- Plan Finder now also lets beneficiaries compare out-of-pocket costs and pharmacy networks in their areas.
- If you prefer not to use the Web, you can call 1-800-MEDICARE or ask for help from state assistance groups and advocacy programs.
Bargain hunting—When comparing plans, you should also know:
- The drugs your chosen plan covers
- Cost-sharing requirement
- Class of drugs most severely affected is “nonpreferred” brand-name drugs. These drugs cost more than generics and don’t enjoy the discounts each insurer negotiated for the brand-name drugs on their “preferred” list.
- The nonpreferred lists vary. Some carriers have negotiated discounts on certain drugs, while others may list such drugs as “nonpreferred.” But the category often includes medications that patients with chronic illnesses have to have.
Medicare requires higher co-pays this year:
- Increased co-payment on nonpreferred drugs
- Switch from requiring enrollees to pay a 25% share of nonpreferred drug costs (so-called co-insurance) to requiring a flat co-payment of a specific dollar amount
- Limiting the number of generics covered in the plans that provide some benefits during the “donut hole” coverage gap. The gap begins after you and your plan pay $2,700 in drug costs, at which point plans aren’t required to pay benefits until you have spent $4,350 out of pocket on drugs. Then benefits begin again.
Filling the coverage gap
Nearly one-third of stand-alone plans and roughly half of plans in Medicare Advantage offer some coverage during the coverage gap. In 2007, most plans that had gap coverage included all generic drugs in their benefit. But in 2008, a good number of plans reduced their benefits and cover only some generics.
The average premium for stand-alone plans with gap coverage has been more than twice that of the basic plans, raising the question of whether the coverage (now with reduced benefits) is worth the money in 2008, says Tricia Neuman, the Kaiser Foundation’s director of Medicare policy project.
Weighing the options:
- Patients can choose from Medicare Advantage plans, employee retirement health care programs, Veterans Affairs benefits, state-funded Medicaid, or manufacturer patient-assistance programs.
- Contact your employer or benefits administrator before making a decision about Medicare Part D
- You can contact the pharmaceutical company assistance program about Part D to determine eligibility.
Finding the best plan
- Patients can contact Medicare either by phone, (800) MEDICARE, or Web
- List your current medications to find plans that cover all your medications
- Compare plans by premium cost, applicable deductible, and pharmacy options.
If you need help, look for a spokesperson or advocate who is knowledgeable about plans to spend time presenting the important facts either one-on-one or in a patient group, such as Better Breathers.
Beware of Medicare scams. The Centers for Medicare and Medicaid Services (CMS) is warning seniors that some people will try to offer them fraudulent plans and acquire their personal and financial information for inappropriate or illegal uses (such as identity theft). Here are some tips from Medicare about protecting yourself from Medicare drug scams:
- No one should come to the door uninvited.
- No one should ask for your personal information during their marketing activities.
- No one should be allowed to take personal information, such as your Medicare number (it is essentially the same as your Social Security number). Never give out personal information until you are sure this person and/or plan is approved by Medicare.
- For addressing questions or concerns, call 1-800-MEDICARE. If fraud is suspected, you should also call a local law enforcement agency and/or the Health and Human Services Office of the Inspector General at 1-800-HHS-TIPS.
About the Author
Mary Hart, RRT, AE-C, is a respiratory therapist and manager of the Martha Foster Lung Care Center in Dallas, TX. She chairs the American Association for Respiratory Care’s (AARC’s) Ad Hoc Committee on Geriatrics.
A version of this article was printed in the May 2009 issue of AARC Times, a publication of the AARC.