Блог Анкара

In This Chapter

^ Qualifying for and enrolling in Part D

^ Choosing only one plan

^ Outlining how drug coverage varies in a year

^ Getting coverage for your drugs

^ Paying for drugs and filling prescriptions

^ Staying in one plan for a year

M N Chapter 1, I introduce you to the general Medicare program, but from

This chapter forward, I focus on the Medicare prescription drug program (also known as Part D). In later chapters, I outline the decisions you’ll likely face in getting drug coverage and how to find the best deal that suits your situation. And I delve into a lot of details on different aspects of Part D. But first, here’s the big picture — a broad view of how the program basically works. If you’re new to Part D, this framework helps you more easily grasp the specific information that you find out later in this book.

Qualifying for Medicare Prescription Drug Coverage

Everyone In Medicare is entitled to Part D drug coverage. As long as you’re enrolled in Medicare Part A Or Part B — it doesn’t matter which — or both, you qualify for Part D. That’s true whether you’re in Medicare because of your age (65 or over) or because you have disabilities.

It doesn’t matter whether you’re rich or poor or somewhere in between. You’re entitled to Part D regardless of your income or how much money you have in the bank or invested in the stock market or stashed under the mattress. However, if your income is low, you may also qualify for a special part of the program known as Extra Help. As its name implies, this part offers much more generous drug benefits and lower costs than the regular Part D program. To get Extra Help, your income and savings are taken into consideration and must be under a certain level, as explained in detail in Chapter 5.

The state of your health isn’t taken into account to enroll in Part D either. Unlike many other types of private health insurance, there’s no such thing as a pre-existing condition in Part D (just as there is none in Medicare as a whole). You can’t be denied coverage because of any illness or disability that you have now or had in the past, no matter how severe, or because you take a large number of drugs or very expensive ones right now.

Voluntary Enrollment and All the Strings Attached

You get to choose whether you want Medicare drug coverage. Well, that’s true for most people. The exception would be if you’re now getting your prescription drugs from Medicaid, The federal-state program that pays the medical costs of people with very low incomes. In that case, you’ll be automatically switched to Part D (and receive Extra Help) to help pay for your drugs as soon as you become eligible for Medicare, as explained in Chapter 5. For everyone else, enrolling in Part D is voluntary.

The folks who tend to be the most anxious about Part D are those who already have prescription drug insurance from elsewhere, such as an employer or union’s health plan, or retiree benefits that cover medications. Let me give some reassurance here. You won’t need to join Part D if you have such coverage And That coverage is what Medicare calls Creditable —meaning Medicare considers it at least as good as Part D. But you’d be wise to check that your current coverage is, in fact, creditable. Also, some employers require retirees to take Part D at age 65 and may or may not contribute toward their out-of-pocket expenses. (Chapter 6 goes into all the angles on how Part D fits in with employer – or union-sponsored drug coverage.)

The outlook is different if your other insurance is Not Creditable, or if you have no coverage for drugs at all. Here’s where the strings are attached. You still have the right to turn your back on Part D, but doing so means you have to pay more for your coverage if you decide to join Part D in the future. Medicare rules say that people without creditable coverage who sign up for Part D Later than when they first become eligible for the benefit Must pay a late penalty in the form of permanently higher premiums. (I explain the late penalty more fully in Chapter 8.)

The late penalty is a powerful incentive (as Medicare intends it to be) for enrolling in Medicare drug coverage at the right time. What the "right time" is for you depends on when you first become eligible for Part D, which in turn depends on your circumstances. The best time to enroll may be when

U You first sign up for Medicare

U You lose your current creditable drug coverage, or decide to drop it I You return to live permanently in the United States after living abroad

Each of these situations comes with a time limit for signing up for Part D without incurring the late penalty, as explained in more detail in Chapter 8.

Picking a Plan, Any Plan — but Only One

In earlier sections, I talk about signing up for Part D as though it were a simple one-step operation. It isn’t. There’s no single Medicare drug plan. Instead, the program is run through many private insurance plans that Medicare has approved to offer drug coverage. To get coverage, you must join one of them.

There are scores of these private drug plans servicing any given area of the country. Some are called Stand-alone plans Because they provide only drug coverage and are mainly used by people in traditional Medicare. Others are Medicare Advantage health plans That provide medical services and prescription drugs. Each plan differs from the next in the fees it charges, the range of drugs it covers, and its overall benefit design. So you have plenty of choices. But when it comes to picking a plan, this isn’t a straightforward, apples-to-apples comparison. It’s more like comparing apples to oranges to pineapples, with maybe a few lemons thrown in. Nonetheless, you have to choose just one.

Not surprisingly, people find this aspect of Part D the most daunting. Even if you’ve had employer health coverage in the past and are used to comparing plans, it’s safe to say that you’ve never faced such a huge number of choices before — there could be well over 50 plans available to you, wherever you live. But please don’t let this put you off. It’s possible to drill down and find the plan that most meets your needs in a relatively short time, if you know how to go about it. You can find all sorts of helpful information on how to do this — including a step-by-step guide for comparing plans properly and to your best advantage — in Chapters 9 and 10. Chapter 11 shows you how to be on your guard against scams and hard-sell marketing tactics. And in Chapter 12, I walk you through the process of actually signing up for a plan.

Making Sense of Drug Coverage That Can Vary throughout the Year

Bizarre as it sounds, you may find yourself paying different amounts for the same medicines at different times of the year. That’s because Medicare drug coverage is generally divided into four phases over the course of a calendar year. Whether you encounter only one phase, two, three, or all four Depends mainly on the overall cost of the drugs you take during the year. Here’s how it works:

U Phase 1, the deductible: This is a period in which you may pay full

Price for your drugs until the cost reaches a limit set by law ($275 in 2008, $295 in 2009) and drug coverage actually begins. Many plans don’t charge deductibles. But if your plan has one, this period begins on January 1, or whenever you start using your Medicare drug coverage.

U Phase 2, the initial coverage period: This begins when you’ve met the deductible, if there is one. Otherwise, it begins on January 1, or whenever you start using Medicare drug coverage. You then pay the co-payments required by your plan for each prescription, your share being roughly 25 percent of the drug’s cost. This period ends when the total cost of your drugs — what you have paid Plus What your plan has paid — reaches a certain dollar limit set by law ($2,510 in 2008, $2,700 in

2009).

U Phase 3, the coverage gap: This gap — often called the Doughnut hole — begins if and when you reach the dollar limit of Phase 2. You then pay 100 percent of the price of your drugs until your total out-of-pocket expenses reach another dollar limit set by law ($4,050 in 2008, $4,350 in 2009). This amount includes your deductible (if any), your co-pays during the initial coverage period, and what you paid for your drugs during the gap.

U Phase 4, catastrophic coverage: If your drug costs are high enough to take you through the gap, coverage begins again. And here, at last, is the good news — your payments then drop sharply. In this period, co-pays are small and set by law: $2.25 per prescription for generic drugs and $5.60 per prescription for brand-name drugs in 2008, or $2.40 and $6.00 in 2009, or 5 percent of each drug’s price (whichever is the greater amount). Catastrophic coverage ends on December 31. The following day, January 1, you return to Phase 1 (or Phase 2 if your plan has no deductible), and the whole cycle starts over again.

Table 2-1 is a quick way of looking at the same progression.

Table 2-1 Phases of Part D Minimum Drug Coverage

And Dollar Limits, 2008 and 2009

What you see in Table 2-1 is the basic design for Minimum Medicare drug coverage that Congress dreamed up and set in law. No drug plan can offer less than this coverage. However, drug plans often vary this design, as explained in Chapter 3. Many charge no, or lower, deductibles. Some plans charge less than 25 percent of the cost for some drugs and more than 25 percent for others. And some plans provide partial or full coverage during the gap, usually for a higher monthly premium. You can find a lot of detailed information about the coverage gap — including how to tell whether you’ll fall into it and some ideas for avoiding it or softening its impact — in Chapters 15 and 16.

No plans limit the amount for catastrophic coverage. If you reach that level, you continue paying the same low costs until the end of the year, no matter how many drugs you use or how high the cost becomes.

^ff^lf If your income is limited and you qualify for Extra Help (as explained in

Chapter 5), you’ll pay far less than the costs shown in Table 2-1, and you’ll receive continuous coverage throughout the year. People enrolled in Extra Help don’t face the doughnut hole.

Getting Coverage for the Drugs You Take

You may assume that all Medicare drug plans cover any prescription medicine that you need. Well, maybe they do and maybe they don’t. No drug plan covers every drug — though every plan has to cover at least two drugs out of several that are used to treat a particular medical condition — and some plans cover a much wider range than others. Each plan has its own Formulary — that is, the list of drugs the plan will pay for.

What if the plan you choose doesn’t cover all of your drugs? You’ll need your doctor’s help here. She may decide that a different drug that Is On the plan’s formulary will work just as well for your medical condition. Or, if your doctor wants to keep you on your present medication, she can help you ask the plan to cover that particular drug for you as an exception to its policy. If the plan turns down your request, you have the right to appeal against its decision.

I explain all these coverage issues (and more) in detail in Chapter 4.

Paying for Your Drugs and Filling Your Prescriptions

To get drug coverage under Part D you’ll likely pay a monthly premium to the Medicare drug plan that you choose. (However, some Medicare Advantage health plans that offer drug coverage don’t charge a premium; see Chapter 9 for details.) You may have to meet a deductible, if your plan has one, before coverage starts. You’ll also pay a share of the cost of each prescription you fill. Your share may be in the form of a Co-payment (a flat dollar amount) or Coinsurance (a percentage of the cost of the drug).

If you compare plans properly — that is, according to the medications you take — you’ll notice a lot of variation in the co-pays that different plans charge for the same drug. What’s more, even within one plan you can pay different co-pays for different drugs. Why and how this happens — plus tips for using the system to your advantage — is explained in Chapter 3.

You can fill your prescriptions at local pharmacies that are in your plan’s Network — meaning that they have a business relationship with the plan. Going to pharmacies outside the network means you pay more for your drugs. Most plans also give you the choice of getting 90-day supplies from a mail-order service, often for a lower price.

How does the pharmacy know what to charge you? After all, your payments can vary according to

U The Part D plan you’re enrolled in

U What phase of coverage you’re in (deductible, initial coverage period, coverage gap, or catastrophic coverage; see the "Making Sense of Drug Coverage That Can Vary throughout the Year" section, earlier in this chapter, for details)

U Whether you receive the Extra Help benefit (see Chapter 5)

U Whether you have other coverage (for example, from an employer or a State Pharmacy Assistance Program) that coordinates with Part D (see Chapter 6)

The answer is that your plan’s ID card is the key that should unlock these mysteries. Scanned through the pharmacy’s computer, it accesses a database that tells the pharmacist the amount you’re required to pay each time you fill a prescription. These pharmacy issues (including what to do if the system fails to work properly) are explained in Chapter 14.

Being Locked into One Plan for a Year

After you’re enrolled in a Medicare drug plan, you have to stay in that plan for the whole year (or the rest of the year if you first join Medicare sometime during the year) except in special circumstances, which are described in

Chapter 17.

During the calendar year, the plan can’t change its overall design or the amount of its premium and deductible. Those must stay exactly as they were at the beginning of the year. The plan can change the prices it charges for drugs, but it must also conform to certain Medicare rules that give some protection to consumers. Chapter 3 goes into this in more detail.

At the end of the calendar year, plans can change anything they please for the following year — their benefit design, their premiums, the drugs they cover, and their co-pays. Most plans do, in fact, make changes, so it’s important to read the notice that your plan must send you each fall (usually in October) informing you of any changes, as explained in Chapter 17.

Being locked into a plan for a whole year makes it all the more critical that you choose the plan that’s best for you to begin with, as explained in Chapters 9 and 10. And, if you want to continue being in a plan that gives you the best deal, you should be prepared to compare plans Every Year.

What were they thinking. . . when they made the Part D drug benefit so complicated?

Part D was the result of a bitter political battle in Congress between lawmakers with opposing philosophies. One group (mainly Democrats) wanted prescription drug coverage to be run by the federal government as a simple add-on to Medicare, for which beneficiaries would pay an extra premium and uniform co-pays for each prescription — a proposal that would’ve cost billions of dollars more than Congress was willing to allow. Another group (mainly Republicans) argued that a drug benefit offered by competing private insurance plans would hold down costs and give beneficiaries more choice. A third group wanted a benefit that would give drug coverage only to low-income people. And a fourth group didn’t want a drug benefit at all, arguing that it would add an expensive new entitlement to Medicare that the country couldn’t afford.

Underlying all these conflicting views was a more fundamental political struggle that had been going on for decades. Should Medicare continue to be a federal social insurance program that gave all eligible Americans the same deal, as originally enacted by a Democratic-controlled Congress and a Democratic president, Lyndon B. Johnson, in 1965? Or should it become a more "privatized" system with a menu of options offered through private insurance companies? Prescription drug

Coverage eventually became a bargaining chip in that struggle. Most Republican lawmakers and some conservative Democrats were willing to add drug coverage to Medicare only if the program was overhauled to include many more private options.

In late 2003, after years of stormy debate, a Republican-controlled Congress narrowly voted to pass the Medicare Modernization Act — by only five votes in the House and ten in the Senate — and a Republican president, George W. Bush, signed it into law. The final package contained compromises that provoked howls of rage from both liberals and conservatives. The act established a drug benefit available to everyone in Medicare and gave extra help to people with low incomes or high drug costs. It also gave private insurers a much greater role in Medicare than they’d had before, as well as large financial incentives to participate in Part D, which resulted in far more drug plans entering the market than had ever been expected. These trade-offs created a program so complicated that the original legislation ran to 681 pages, and subsequent regulations that interpreted the law and put it into effect ran to thousands more. Years later, Part D remains controversial, with many lawmakers on both sides vowing to "reform" it, in one way or another, if they get the chance.

Chapter 3