Блог Анкара

In This Chapter

^ Recognizing when you can enroll in Part D without incurring a late penalty

^ Confirming some last-minute items before signing up

^ Understanding the process of enrolling in a Medicare drug plan

^ Figuring out why your enrollment may be held up or rejected

#«^hew! The hard part’s over. You’ve chosen a Part D plan — either a

Stand-alone drug plan or a Medicare health plan that comes with drug coverage. In contrast, signing up for that plan’s usually a cakewalk.

In this chapter, I assume you’re joining Medicare Part D for the first time. Even so, people may be plunging into the Part D pool from a number of points, so I consider these different circumstances in explaining when to enroll in a plan. Then I suggest some last-minute checks you can — and should — make Before Signing up. After that (at last!), I show you how to enroll and give you some tips on the process. Finally, I explain how an enrollment application may occasionally be delayed or denied.

Stay Informed: Knowing the Right Time to Enroll

The right time to enroll in Part D is when you can sign up without incurring a Late penalty — extra payments that add to your premiums for as long as you stay in the program. In Table 12-1, the white area shows when you can enroll in Part D for the first time to avoid a late penalty. The shaded area shows when you can sign up if you delay and miss these deadlines, or deliberately drop your current drug coverage — in which case you should probably prepare to face a late penalty.

In the following sections, I describe the three kinds of enrollment periods in Table 12-1 in more detail and explain why you shouldn’t wait until the last minute to enroll in a Part D plan. For the full scoop on how you can avoid the late penalty, head to Chapter 8.

Distinguishing among different enrollment periods

Medicare permits three types of enrollment periods:

Initial enrollment period (IEP): Medicare assigns you a seven-month IEP around the time of your 65th birthday or, if you’re younger and have a disability, around the time you receive your 25th Supplemental Security Income (SSI) check. You can use this time frame to sign up for Medicare Parts A and B, according to your circumstances, as explained in Chapter 1. You can also sign up at this time for a Part D plan if you don’t have Creditable drug coverage. Basically, this term means drug coverage from elsewhere (like an employer or union) that’s considered at least as good as Part D. (Still baffled? Take a look at Chapter 6, which covers creditable drug coverage in detail.) If you lived abroad or were in prison at the time of your 65th birthday, you get a special IEP, also lasting seven months, to sign up for Part D upon your return to the U. S. or upon your release, as explained in Chapter 8.

Special enrollment period (SEP): Medicare allows you an SEP to join Part D in certain circumstances — if you lose creditable drug coverage through no fault of your own or have an unavoidable break in coverage. You get an SEP if your employer terminates your drug benefits or reduces coverage so it’s no longer creditable. You also receive an SEP if you turned 65 before moving abroad or going to prison and want Part D coverage after your return or release.

If you’re eligible for an SEP, all you have to do is sign up with your chosen Part D plan and make sure that your coverage starts within the allotted time. You Don’t Have to apply for an SEP in any of the circumstances shown in Table 12-1.

Annual enrollment period (AEP): If you don’t have creditable coverage and fail to sign up for a Part D plan before your IEP or SEP expires, you can’t sign up for a plan until the next AEP that starts November 15 and ends December 31. As a result, you’ll be without drug coverage until January 1 and will face a late penalty. Also, if you deliberately dropped creditable drug coverage (instead of losing it involuntarily), you can sign up for Part D only during an AEP.

If you qualify for low-cost drug coverage under Part D’s Extra Help program (see Chapter 5), you can enroll in a Part D plan any time you want during the year. Your coverage starts on the first day of the month after you enroll. You won’t incur a late penalty, even if you sign up late.

Recognizing why you shouldn’t sign up at the last minute

Your Medicare prescription drug coverage begins on the first day of the month after you enroll in a plan. Technically, you can sign up on the very last day of an initial or annual enrollment period (for example, December 31) and still be covered the next day (in this case, January 1).

But — and this is an alert for the chronic procrastinators — putting off enrolling until the last minute isn’t the best idea. In fact, Medicare recommends signing up at least two weeks before your deadline. Here’s why:

I The plan needs time to verify the information you provide on the

Enrollment form (such as your eligibility to receive drug coverage) or to get back to you if the information is incomplete (see the later section "If your enrollment is delayed" for more).

I You want to be able to mosey over to the pharmacy and pick up your meds without hassle after your Medicare drug coverage begins. Giving your Part D plan enough time to upload your data into the computer system increases the odds of this process going smoothly. (Flip to Chapter 14 for the basics on filling your prescriptions.)

I If you have a special enrollment period, you must receive Part D coverage before the 63 days are up to avoid a late penalty. If you wait longer than 60 days to enroll, you can incur a penalty, depending on where your SEP falls in the calendar, as explained in more detail in

Chapter 8.

I Here is a different reason for signing up as early as you can: If you have a seven-month IEP and enroll in a Part D plan during the First three months Of that period, your coverage starts on the first day of the month in which you turn 65 or in which you become eligible through disability — even if those dates fall at the end of the month.

Play It Safe: Making a Few Final Checks before You Sign Up

Yes, I know — you’ve had enough of all this rigmarole by now and just want to join the darned plan! I sympathize. But remember that after you’re enrolled, you’ll probably be locked into the plan for the whole year. So I don’t feel comfortable saying, "Okay, go ahead," without suggesting a few practical, final precautions. Following them is entirely up to you, of course, but playing it safe never hurts, and sometimes it pays off big-time.

Make sure you live in the plan’s service area. If you live outside this area, your enrollment won’t be accepted.

Keep the plan details as a record of why you chose the plan. If you

Chose it from the online Medicare Prescription Drug Plan Finder, print out all the details that show your likely costs and keep them safe. If you called the Medicare help line for the same information, keep the printout the customer rep sent you. You need this record if, after enrollment, you believe the plan’s charging more for your drugs than it quoted on the plan finder and you want to change to another plan as a result, as explained in Chapter 17.

Double-check the details of your costs under the plan. Make sure the drug information you entered into the plan finder is correct, as I describe in Chapter 10. If the details you entered — especially each drug’s dosage and how often you take it — aren’t accurate, the quoted costs aren’t going to be accurate either. Verify your likely costs by looking at your printout and/or calling the plan.

I Make sure that this plan is the one you want and that you understand its conditions. This check is especially important if you chose this plan on the advice of a salesperson or insurance agent, or from marketing materials sent through the mail. If you’re not sure this plan is "the one," call it — not the salesperson — to confirm you understand exactly what you’re buying. When people are misled into joining an inappropriate plan, it’s often because they didn’t fully understand the plan’s conditions and consequences, as explained in Chapter 11.

If the plan is a Medicare HMO or PPO, make sure it includes drug coverage. If you join an HMO or PPO that doesn’t cover drugs, you won’t be able to get drug coverage any other way for the rest of the year, as I describe in Chapter 9.

If the plan is a Private Fee-for-Service plan or a Medicare Cost plan, confirm that it includes drug coverage. If it doesn’t, and you want drug coverage, you should choose and enroll in a stand-alone Part D plan before your enrollment period expires. The same is true of Medicare Medical Savings Account plans, which don’t cover drugs.

If you chose your plan through a search of Medicare’s online plan finder, you won’t have to verify whether the plan is in your service area or includes drug coverage. Because you must enter your zip code at the beginning of this search, all the plans that appear on-screen are available in your area, and all of them cover prescription drugs. Otherwise, you can call Medicare at 800-6334227 to check these details.

Take the Plunge: Enrolling in a Plan

Actually enrolling in a plan is the easy bit. You still have choices on how to do it, but they’re simple ones. The process is the same whether you’re enrolling in a stand-alone prescription drug plan (PDP) or a Medicare health plan that includes drug coverage (MAPD). All you need are your Medicare ID number and the name of the plan you want to join. Then you can sign up, or a legal representative can do so on your behalf, in any of the following ways:

W Calling Medicare’s help line toll-free at 800-633-4227: Tell the customer representative you want to enroll in a Part D plan. Have at hand your Medicare ID number and the name of the plan.

W Visiting Medicare’s Web site at Www. medicare. gov: On the home page, look for a menu headed Prescription Drug Plans in the top right-hand corner and click "Enroll." Doing so takes you to the Medicare Part D enrollment center. Most plans allow enrollment through the center, but a few may not. If your chosen plan doesn’t, the customer representative at the center can give you that plan’s phone number.

I Calling the plan directly: You can find the plan’s customer service number in its marketing materials, on its Web site, or on the top right of its plan details page (if you chose the plan on Medicare’s plan finder or asked Medicare to mail you details of the plan).

I Visiting the plan’s Web site: If the plan offers online enrollment (not all do), you can find its Web site address in its marketing materials and on the top right of its plan details page on Medicare’s online plan finder. Or you can do an Internet search for the plan’s name.

I Completing a paper application: Call the plan and ask it to send you an application. Fill out this paperwork, sign it, then mail or fax it to the address or number provided.

And that’s it! Well, almost. Whichever way you choose to sign up, you’ll be asked a number of questions you must answer before your enrollment can be completed. Be prepared by having this info ready:

I Your name, address, and phone number

I Details of your Medicare coverage, as shown on your Medicare ID card

4

I Details of any other drug coverage you may have

I Circumstances indicating that you may qualify for Extra Help

I How you want to pay your premiums

I If you live in a long-term care facility, such as a nursing home

A Part D plan can’t ask you for your bank account or credit card information during the enrollment process, regardless of whether you enroll on a paper form, by phone, or online.

Enrollment is a legal contract between you and the plan. So if you can’t manage the enrollment process yourself, either through incapacity or illiteracy, the person who enrolls you must be someone who has the authority to do so under your state law. This person can be a legal representative, a court-appointed guardian, or a family member or caregiver who has Durable power of attorney — that is, someone authorized to make medical decisions on your behalf. When making the enrollment request — whether on paper, online, or on the phone — your representative must attest that she has the appropriate legal authority and can show documentary proof if the plan requests it. She must also provide her contact information.

In the following sections, I tackle in detail three important issues that may arise during the enrollment process.

Grasping the importance of your address

No, your Medicare prescription drug plan doesn’t care a scrap whether you live in a mansion or a minivan. But the address you provide determines

I If you live in the plan’s service area: No plan will accept your enrollment if you don’t live in its service area. For stand-alone drug plans, that means living in the state the plan serves. For Medicare health plans, this area is defined as the region (a state, county, or zip code) that the plan serves. Even for plans that don’t have defined service areas, you must sign up for the one that’s offered in the area where you live.

I Where your permanent residence is: You can’t be enrolled in two plans at the same time, so if you live in different states during the year, you can’t have one plan per address. When enrolling in a plan, you must give the address of your Permanent Or Primary residence — the place considered to be your normal home (for example, the one used on tax forms). If you provide a post office (PO) box number as your address, the plan must contact you to confirm that you live in its service area.

If you’re homeless or don’t have a fixed address, the Part D plan you want may accept the address of a shelter or clinic, a PO box number, or anywhere else that you receive mail.

Deciding how to pay the premiums

When enrolling, you’ll be asked how you want to pay your monthly premiums to the plan. Here are your options:

I Ask the plan to bill you directly and pay the premiums every month by check, money order, or credit card.

W Have the premiums deducted automatically from your monthly Social Security checks. (The plan arranges this deduction for you.)

I Agree for the premiums to be automatically sent to the plan each month by Electronic Funds Transfer from your bank, or charged to your credit card. (The plan will ask you to fill out and return a form, along with a voided check from your bank account or your credit card details.)

Many people choose to have their plan premiums taken out of their Social Security checks, in the same way that Medicare Part B premiums are deducted. But this payment method can cause difficulties. There have been many instances of Social Security failing to make plan premium deductions for the first two or three months, and then taking them all out of a single check. Or, in the case of people who’ve switched from one plan to another, deducting two premiums rather than one for several months. Similar errors can occur in automatic payments from a bank account or credit card.

Disclosing other drug coverage you have

During the enrollment process, you’ll be asked whether you have any other drug coverage — for example, coverage from an employer or union, veterans or military benefits, private individual insurance, or a State Pharmacy Assistance Program (SPAP). The Part D plan needs this info for two main reasons:

W To protect you: In some cases, joining a Part D plan can automatically cancel your other medical and drug coverage, as explained in Chapter 6. If you have creditable drug coverage from elsewhere, the plan may contact you to confirm that you understand the consequences of joining Part D. You’ll have 30 days to respond. If you don’t respond within this time frame, your enrollment will be denied, as I explain later in this chapter.

W To coordinate your benefits properly: Listing any other benefits you’re entitled to means that the plan can log them into its computer system so that when you go to fill your prescriptions, the pharmacist knows what to charge you and whom to bill. Otherwise, you may pay more than you should. I explain more about how this coordination of benefits works (and how it sometimes doesn’t) in Chapter 14.

Don’t Give Up: Understanding Why Your Enrollment May Be Delayed or Denied

Your enrollment isn’t complete until your chosen plan accepts it. Within ten calendar days of receiving your enrollment request, the plan must send you one of these items:

W A notice acknowledging your completed application, together with a copy of it, and details about the plan’s costs, benefits, and conditions

W A request asking for more information to complete the application

W A notice saying your application has been denied

If you receive only the acknowledgment, your enrollment probably will be confirmed very soon, and you’ll receive your membership card and Evidence of Coverage, as explained in Chapter 13. Read the following sections if your plan sends you either a request for more information or a denial notice.

If your enrollment is delayed

Enrollment can be delayed if

W You haven’t completed all the information required on the enrollment form, and the plan needs to get back to you

W You don’t submit additional information as soon as you’re asked

W Medicare doesn’t immediately confirm that you’re eligible

W The plan discovers you have coverage from elsewhere (such as employer or union health benefits) and contacts you to be sure you understand the consequences of joining the plan

IJ$jAB££ In all of these cases, the plan will contact you either by mail or phone. So it’s important to look out for a letter from your plan, or to return messages it has left on your answering machine. If you’re asked for more information and don’t provide it within 30 days, the plan has no choice but to consider your application incomplete and reject it.

What if your enrollment’s delayed past the date when your coverage should begin? In this situation, the plan covers you until the matter is resolved. (During this time, you can use a copy of your enrollment form or the plan’s acknowledgment as proof of coverage at the pharmacy until your plan membership card arrives, as explained in Chapter 13.) But if your enrollment is ultimately denied for any of the reasons in the next section, you’d have to repay the plan for any services used.

If your enrollment is denied

If you’re in Medicare, you have an absolute right to Part D coverage. So if a plan turns you down, you need to know why. Here are the possibilities:

W Your eligibility for Medicare can’t be found in the official records.

W You didn’t answer all the questions on your enrollment application, didn’t complete it within the required time, or failed to respond to the plan’s request for additional information.

W You don’t live within the plan’s service area.

W Your enrollment period has expired.

W You applied outside the time frames for initial or annual enrollment, and you don’t qualify for a special enrollment period.

W You have creditable drug coverage from an employer or union, and you didn’t respond within 30 days to the plan’s request for confirmation that you understand how joining Part D can affect this coverage.

W You’ve applied to a Medicare Advantage plan but don’t have Medicare Part A and Part B. (Both are required for MA plans. To join a stand-alone Part D plan, you need only one or the other. To join a Medicare Cost plan, you need only Part B.)

W You’ve applied to a Medicare Advantage plan but already have end-stage renal disease. (ESRD patients can’t join an MA plan.)

W You’ve applied to a Medicare Advantage plan that isn’t currently accepting new enrollees.

W You’ve applied to a Special Needs Plan but don’t fall within the category of people it serves, as explained in Chapter 9.

W You’ve applied for a Medicare Medical Savings Account plan but don’t meet its eligibility requirements, as explained in Chapter 9.

If your enrollment’s denied, the Part D plan or Medicare must send you a letter explaining why. You don’t have the right to appeal against an enrollment denial. But if you think the given reasons are incorrect, call the number on your denial notice as soon as possible. Provide information showing why you think the denial is incorrect. If that doesn’t work, contact your regional Medicare office to explain the problem. (For the office number, call Medicare at 800-633-4227.) You can also get expert advice and help from your State Health Insurance Assistance Program (SHIP) or the Medicare Rights Center; see Appendix B for contact info.

Part IV

In This Chapter

^ Protecting yourself against outright scams

^ Resisting aggressive and unethical sales tactics

Edicare Parts C and D are commercial marketplaces where products (in this case, Medicare health plans and prescription drug plans) are sold to consumers (Medicare beneficiaries). And like every other marketplace, they attract their share of swindlers and rip-off artists whose sad aim in life is to separate unsuspecting customers from their money.

But you aren’t going to be easy meat! You aren’t going to give those creeps any chance to exploit your uncertainties and trust! You may not come up against any of them at all, but if you do, you’ll be prepared. Why? Because I’m going to show you how to see through their deceptions and sweet talk so you know when to show them the door, hang up the phone, or walk away.

In this chapter, I explain how to be on your guard against two quite different types of deceptive practices: the outright scam and the hard sell. I also suggest what you can do — maybe even to reverse the situation — if you do get ripped off.

Steering Clear of Outright Scams

An Outright scam Is when some thief pretends to be from Medicare, Social Security, or a Part D plan and asks for sensitive information — such as your Social Security, credit card, or bank account number — in an attempt to steal your identity or money.

Outright scammers have nothing to do with Medicare. They’re just using Medicare (and most often Part D) as a pretext to cheat you of your hard-earned cash. The scam may be relatively simple — like trying to con you into paying a nonexistent enrollment fee for a false Part D plan. Or it may be a much more serious attempt to commit identity theft.

Identity thieves hunt for key pieces of personal information — Social Security numbers (or Medicare IDs, which are the same thing), credit card or bank account numbers, and even dates of birth and mothers’ maiden names if they can get them. Whatever personal data they pull about you, identity thieves use it to buy merchandise, apply for new credit cards in your name, or make a profit by selling it to other identity thieves. Many of them have managed to buy big-ticket items, like houses, cars, and even expensive medical care, by successfully pretending to be someone else.

This crime not only robs people of money but also of their good credit rating, which is a much more worrying loss. Restoring your credit rating can take months or years of effort. Clearly, identity theft is a nightmare you want to avoid at all costs. That’s why I explain what you need to know in the following sections.

Red flags to Watch out for

BEH Scams happen unexpectedly. You answer the phone or the doorbell and find someone who sounds or looks perfectly respectable offering to help you. How can you tell whether to trust this person? Here are some pointers you should recognize as instant red flags:

A person at your door saying he’s from Medicare or Social Security:

The real agencies never send anyone to your home on official business without an appointment.

A person claiming he represents a particular Part D plan: No one can

Come to your home uninvited to sell any kind of Medicare insurance. Doing so is illegal. Also, Medicare prohibits plans from cold-calling you on the phone. They can call only at your request. So if someone calls without your permission, it’s probably a scam.

A person asking for an enrollment fee or an advance premium payment: You should never have to pay for someone to enroll you in a Medicare health or drug plan. Nor should you pay any one-time payment that supposedly takes care of your premiums for months, years, or forever. Neither the enrollment fee nor the advance premium payment exists, so asking for either is illegal.

A person requesting your personal financial or identification information: Never ever give out your Social Security or Medicare ID number, or any details about your credit cards, bank accounts, or other financial information — especially on the phone. Legitimate callers don’t ask for this info.

A few lies already reported to Medicare

Con artists dream up new and creative ideas all the time for ways to target older Americans and steal their money and/or identities. Following are some typical scams involving Medicare and Part D that seniors have reported:

The loss of Medicare coverage threat: The caller claims to be a government official needing to check your Social Security (or Medicare ID) number — and threatens or implies that if you don’t provide it, you’ll lose your Medicare coverage. Medicare already has these numbers. You can’t lose Medicare benefits by refusing to give them out.

The Medicare refund tactic: The caller claims to be from Medicare, says you’re due for a refund, and asks for your bank account number in order to deposit your money. This refund doesn’t exist; if it did, Medicare wouldn’t contact you this way.

The "no more cash" routine: The caller claims to be from Medicare or another agency that sounds official and says that under a new Medicare rule you’ll no longer be able to pay cash for your Part D co-pays at the pharmacy. Instead, you must pay by credit or debit card, so of course the caller needs your card number on file, for security purposes. No such Medicare rule exists. You can pay for your drugs any way you please.

The bogus Part D enrollment fee: The caller claims to be from a Part D plan, offers to enroll you for a fee, and asks you to pay by credit card. No plan or fee exists. Asking for a Part D enrollment fee is illegal.

The automatic premium deduction trick: The caller claims to be from a Part D plan, supposedly enrolls you on the phone, and asks for your credit card or checking account number so the premiums can be automatically deducted every month. This plan doesn’t exist. No real Part D plan can enroll you on the phone — unless you make the call — or ask for payments or financial information over the phone.

The ol’ "Medicare’s going out of business" line: The caller claims to be a federal official, tells you that Medicare is discontinuing its services, and says that you can buy a plan that provides a similar service. This scam’s a real whopper! Medicare isn’t going away.

You’re probably not going to encounter any of these scenarios. But it’s wise to be alert to the possibilities, because being forewarned is good protection. And what if one of these situations does happen? You can hang up the phone or shut the door. You can say firmly that you’re not interested. Yes, you can, even if you feel doing so is impolite! Don’t be deceived by a friendly voice, a charming smile, a willingness to chat, or an apparent interest in your health and lifestyle. Con artists are experts at controlling the conversation to win your confidence and keep you on the phone or get invited inside. These people don’t care about you. They’re criminals who see you as a potential sucker. So show them you’re not.

Who to contact to report a scam

The scams in the previous section are known only because seniors on the receiving end took the trouble to report them. Authorities who hear such reports send out alerts so the scams become widely known and more consumers are put on their guard. So if someone tries to scam you, do everyone a favor by reporting the incident to any of these offices:

Your state’s attorney general or insurance commissioner. (Their phone numbers are in the state pages of your phone book.)

Federal Trade Commission — the official consumer protection agency.

• Call its toll-free help line at 877-382-4357 (TDD: 866-653-4261).

• Write to FTC, Consumer Response Center, 600 Pennsylvania Ave. NW, Washington, DC 20580.

• File a complaint online at Www. ftc. gov.

Inspector General of the Department of Health and Human Services.

• Call 800-447-8477 (TDD: 800-337-4950).

• Write to the Inspector General, HHS, Attention: Hotline, 330

Independence Ave. SW, Washington, DC 20201.

• Send an e-mail to HHSTips@oig. hhs. gov.

Actions you can take if you’re ripped off

Suppose you fall for a scam, despite your best intentions. You may be able to stop a payment by contacting your bank or credit card company immediately, before the transaction clears. Similarly, if you give your credit card or checking account number to someone who uses it to buy items without your consent, the credit card company or bank usually refunds the money — even if it has already been taken out of your account — after you report the theft and the company investigates it.

IJjjj|kB£^ If you give out any personal information — such as your Social Security or Medicare ID number, or your credit card or bank numbers — you should seriously assume that you may be a victim of identity theft, even if you don’t immediately see any evidence of it. The following can give you excellent advice on what to do next:

The Privacy Rights Clearinghouse: This California-based, nonprofit consumer organization provides assistance and information to likely or actual victims of identity theft. For fact sheets on identity theft, call 619-298-3396 (or write to Privacy Rights Clearinghouse, 3100 Fifth Ave., Suite B, San Diego, CA 92103). You can also read the fact sheets online at Www. privacyrights. org/identity. htm.

The Federal Trade Commission: This agency provides an Identity Theft Hotline for consumers (877-438-4338) and a guide, Take Charge: Fighting Back Against Identity Theft. You can call the hotline for a free copy (in English or Spanish) or find it at Www. ftc. gov/idtheft. Go to the same Web site to obtain more information and a complaint form.

Stories from the front lines

Soon after the hard-sell tactics used by some sales agents became publicly known, I invited readers of the AARP Bulletin To let us know if they’d encountered any. Here are a few of their stories:

Bobby, a 75-year-old retired construction worker living in Oklahoma, was happy with his coverage from traditional Medicare and veterans benefits. "I’d been in Medicare since 1985," he said. "I wasn’t going to do anything to jeopardize that." But he listened when the saleswoman came to his home and sold him what he thought was a Medigap policy. "She said it was supplementary insurance that paid what Medicare didn’t," he recalled. "She lied to me." Soon afterwards, he was rushed to his local hospital in a coma and spent ten days there. It was only then that he discovered she’d actually signed him up for a Medicare HMO. Bobby’s hospital wasn’t in the HMO’s provider network, and the plan refused to pay his $45,000 bill. It did pay finally, because plans must cover emergency care. But Bobby — while still believing he was in traditional Medicare and able to go to any hospital — had already started a course of radiation treatment costing $16,000, which the plan also refused to pay. Eventually, after disenrolling from the HMO and enduring months of hassle, Bobby was able to get Medicare to pay for his treatment retroactively.

Elinor, a 79-year-old retired nurse living in Florida, had recently been widowed

And was stressed out after caring for her husband through a long, difficult battle against cancer. She knew she didn’t want the Medicare HMO plan the saleswoman was pitching. "But she kept pushing," Elinor said. "And because I wasn’t in the best frame of mind at that time, in order to get her the heck out of the house, I signed the paper." Soon after checking with her doctors and finding they didn’t accept the plan, Elinor wrote canceling the enrollment (as the agent had told her she could) and thought that was that. But the first time Elinor tried to fill a prescription, using her old stand-alone Part D plan card, the pharmacist told her she wasn’t covered by it any more — she was in an HMO. It took six months of constant calls before Elinor was finally able to disenroll from the HMO and return to her original coverage from traditional Medicare, the Part D plan, and Medigap insurance. "I should never have had to go through this nightmare, all because of that insensitive, fraudulent agent," she said. "Normally, I never sign things. But I got caught at a bad time when I was vulnerable, and she used it."

Eva and her husband, who live in North Carolina, had a Medigap supplementary policy that was becoming increasingly expensive. It had reached almost $300 a month for both of them by the time she got a call from someone asking about supplementary insurance. So she agreed for a salesman to come to their home to talk about it. "This man came and said he

(continued)

(continued)

Could offer insurance for $98 a month," she said. "It was the $98 that sold me, I guess. But never once did he say it was a Medicare Advantage plan." In fact, it was a Private Fee-for-Service type of MA plan. And although the salesman told her it was "good anywhere," Eva quickly found that none of her local doctors or hospitals would accept it. Getting disenrolled from the plan

Was "the worst rigmarole I’ve ever seen." And she met others who’d had the same experience. Like them, she said, "I just thought I was buying a cheaper supplementary policy."

Reprinted from the October 2007 issue of the AARP Bulletin, A publication of AARP. Copyright 2007 AARP. All rights reserved.

Resisting Hard-Sell Marketing Tactics

The Hard sell Is when a plan’s salesperson or an independent insurance agent uses aggressive or unethical tactics — such as bait-and-switch — to try to push you into signing up for a plan you don’t want or whose consequences you don’t understand.

Part D plans and Medicare health plans aren’t supposed to pressure or mislead you into buying one plan versus another. Medicare has rules to prevent such practices — though arguably not enough — and some of the plans themselves have voluntarily agreed to a code of conduct designed to stop what they call "rogue" salespeople from making hard sells. Still, hard sells can (and do!) happen.

You may never meet the kind of hard-sell tactics I warn about in the following pages. But whether you’re a Medicare beneficiary or someone looking out for an older relative, being alert to the possibilities and knowing how to protect yourself (or your loved one) against such pressures is wise.

In the next several sections, I describe types of salesmanship to be aware of and suggest three lines of defense for resisting marketing pressure. The most important of which is understanding at least the main differences among kinds of Medicare insurance and the consequences of changing from one type to another. I also share the rules on what plans can and can’t do when trying to make a sale — and checks you can make before signing on the dotted line. Finally, I explain what you can do to reverse the situation if you’re tricked or misled into joining a plan you don’t want or understand.

Assessing different kinds of salesmanship

You need to be able to distinguish among three kinds of salesmanship, ranging from the acceptable through the unethical to the downright illegal:

Straightforward salesmanship: Agents accurately describe the plan they’re paid to pitch (whether a stand-alone Part D plan, Medicare Advantage health plan, or Medigap policy) and clearly explain how it’ll add to, or change, the consumer’s existing insurance. This plan may not be the best one for the consumer — only an impartial comparison of several plans can determine that, as explained in Chapters 9 and 10 — but the agents are doing their job fairly.

Unethical bait-and-switch: The consumer is interested in a standalone Part D plan or Medigap insurance. But the agent is trying to sell a Medicare Advantage plan without being honest about the consequences of making that change. The consumer may be persuaded to sign up for the MA plan, not understanding that it can mean losing her current doctors and hospitals in traditional Medicare, her existing drug plan, her Medigap insurance, or in some cases, her retiree health coverage.

Illegal enrollment: In the worst cases — not common, but known — agents say or do anything to get a signature, usually for enrollment in a Medicare Advantage plan. This sales approach includes the following:

• Saying consumers will lose Medicare or Medicaid benefits if they don’t sign or saying that Medicare’s ending

• Entering nursing home rooms uninvited

• Signing up very frail or mentally ill people who can’t properly make a decision

• Telling people their signatures are needed only to confirm that they’ve met with the agent

• Forging signatures on the enrollment form

All of these tactics are exploitative and prohibited by law. Selling Medigap insurance to anyone already enrolled in an MA plan is also illegal.

How can such scenarios happen? After these sorts of tactics first became publicly known in 2007, Medicare announced a crackdown on abuses and set tougher rules for the hiring and training of sales agents. In 2008 Congress prohibited certain practices. Perhaps these regulations (described later in this chapter) are now curbing the most disgraceful kinds of exploitation. But one underlying problem hasn’t changed, at least at the time I’m writing this book.

Plans are still allowed to pay agents higher commissions for selling Medicare Advantage plans than stand-alone drug plans. For example, agents may be paid $40 to $80 for each stand-alone Part D plan they sell, but up to $500 for each Medicare Advantage plan. (That’s because MA plans are far more profitable for the insurers.) So it doesn’t take a rocket scientist to see that the system encourages abuse. Unless Medicare requires individual insurers to offer the same commission for every type of plan they sell, it’s difficult to see how hard-sell tactics can be outlawed completely. Unscrupulous agents will always be attracted by bigger bucks.

Understanding the Various types of Medicare insurance

How is it possible for sales agents to persuade people to sign up for Medicare Advantage plans they don’t want? Are these folks dumb, or what? Absolutely not! Sometimes their signing can be the result of bullying tactics that take advantage of a senior’s vulnerability, as in some of the experiences described in the nearby sidebar "Stories from the front lines." But often it happens because people simply aren’t armed with their first line of defense: They don’t understand the differences among varying types of Medicare insurance. And who can blame them?

Just think how many types are out there, all with Medicare in their names. Traditional Medicare. Medicare Advantage. Medicare Medical Savings Accounts. Medicare (Medigap) supplementary insurance. Medicare drug coverage. And those types are just the broad divisions. You can’t even rely on the names of the insurers to tell them apart. Many large insurers sell Medicare Advantage plans, Medigap policies, and stand-alone Part D plans.

Now’s a good time to take another look at Table 1-1 in Chapter 1, where you can see at a glance the broad differences between each type of Medicare insurance. I explain in more detail how the different types of Medicare Advantage plans vary from each other, and from traditional Medicare, in

Chapter 9.

Here, I focus on what you need to know to avoid being Misled By a sales agent. I emphasize Misled Because there’s nothing wrong with choosing a Medicare Advantage plan when you know what you’re buying. Millions of people enrolled in them are satisfied with their coverage. But if you’re in traditional Medicare now and someone actively tries to enroll you in an MA plan, be aware of the following consequences of switching:

You’ll receive your Medicare benefits through the MA plan — not through traditional Medicare — and must accept the plan’s conditions.

You may not be able to go to the same doctors and hospitals that treat you now in the traditional Medicare program.

If you enroll in a Medicare HMO or Special Needs Plan that restricts your choice of doctors and hospitals to those in its network, and you go outside of that network, you’ll be responsible for the full cost of the treatment — except in an emergency. (In an emergency, the plan must cover your treatment anywhere.)

If you enroll in a Private Fee-for-Service plan and are treated by a doctor or hospital that doesn’t accept the plan’s terms and conditions, you’ll be responsible for the full cost of the treatment — except in an emergency. Also, a provider can decide whether or not to accept the plan’s coverage on each visit a patient makes.

I If you enroll in a Medicare Medical Savings Account Plan (MSA), be aware that after you use up the money deposited into your account, you’ll be responsible for the full cost of any medical services until you meet your deductible. One or two days in the hospital can completely gobble up the typical deposit amount. (The structure of an MSA is similar to a Part D plan in that they both have a gap in coverage in the middle. In a drug plan, it’s the doughnut hole; in an MSA, it’s the deductible.)

I If you have standard Medigap supplementary insurance, you can’t use it to cover your out-of-pocket expenses in an MA plan. Medigap policies can be used only with traditional Medicare.

I If you’re enrolled in a stand-alone Part D plan, this coverage is

Automatically canceled as soon as you’re enrolled in an MA plan — even if the MA plan doesn’t provide drug coverage.

I If you have retiree health insurance from an employer or union, you may lose this coverage by being enrolled in an MA plan. (For more about this possibility, see Chapter 6.)

In addition, here are a couple of tidbits to be aware of when listening to pitches for Medigap supplementary policies or stand-alone Part D plans:

I Medigap policies typically cover out-of-pocket expenses in traditional Medicare no matter which hospital or doctor you choose, anywhere in the country. Medigap SELECT policies are the exception. They have lower premiums but require you to use specific hospitals, clinics, and doctors within a geographical area (except in an emergency) in order to receive the insurance benefits.

I Individual insurers typically offer two or three different stand-alone Part D plans. The one with the highest premium is usually an enhanced plan with extra benefits (for example, some coverage in the doughnut hole, also known as the coverage gap; see Chapter 15 for an introduction). If you don’t need these extras, the higher premium may not be worthwhile. The only way to decide — and avoid undue pressure to buy the most expensive plan — is to compare plans properly according to the drugs you take, as explained in Chapter 10, instead of relying on a sales pitch.

Getting familiar with Medicare marketing rules

Knowing the can’s and can’ts of what plan sponsors or their sales agents are allowed to do when selling their products is your second line of defense in spotting whether a sales pitch is out of line and should be mistrusted. Medicare has had most of the following regulations in place for several years, but some are tougher rules put into effect after the marketing abuse scandal erupted. All refer to both Medicare Advantage health plans and stand-alone Part D plans, unless otherwise stated.

Medicare allows plan sponsors to

I Send promotional materials to you through the mail — but not enrollment forms.

I Send sales reps to your home — but only with your prior permission and only to discuss the single type of coverage (for example, stand-alone drug plan, Medicare Advantage plan, or Medigap insurance) that you specify when making the appointment.

Give sales presentations in public places like shopping malls or hotels. icare doesn’t allow plan sponsors to Send salespeople to your home uninvited.

Telephone you directly to make a sales pitch — Unless You invited the call or already have a relationship with the plan.

Tell you that a home visit is required for the purpose of explaining details of the plan or for you to enroll in it.

Ask for personal information on the phone, including your address, prescription meds, Social Security number, credit card or bank account numbers, or any other financial information.

Enroll you in a plan on the phone — unless you call the plan.

Give sales presentations or distribute enrollment forms in doctors’ offices, hospitals, pharmacies, long-term care facilities, or anywhere patients go to receive healthcare-related services (except in common areas such as public lounges at such facilities).

Give sales presentations at educational events such as health information fairs and community meetings.

Offer free gifts, cash, meals, or other giveaways to encourage you to enroll in a plan

Medicare requires plan sponsors to

I Explain clearly in their marketing materials and verbal sales pitches that not all doctors and hospitals accept their Medicare Advantage plans.

I Ensure that any independent sales agents they hire are licensed by the state in which they work.

I Guarantee that sales agents are paid the same commission for each MA plan the sponsor sells in any given year. Also, that agents are paid the same commission for each stand-alone Part D plan the sponsor sells. (But a sponsor can pay commissions for MA plans that are different from stand-alone drug plans.)

F Train sales reps, independent insurance agents, and brokers who sell their products, and hire only those candidates who score at least 80 percent on a written test of their knowledge of the Medicare program, its rules, and the details of the plan(s) they’ll sell.

F Ensure that sales agents who meet with consumers to discuss a particular type of plan (such as Medigap insurance) can’t also, at the same meeting, discuss other types of plans (such as MA health plans or stand-alone Part D plans) but must instead schedule a separate appointment, at least 48 hours after the first, to discuss another.

F Call consumers who sign up for any MA plan to check that they understand its conditions and consequences, and allow them the opportunity to withdraw from the enrollment if they want to.

Thinking and checking before you sign

Taking the time to think and verify information is most certainly your third line of defense against signing up for the wrong plan. Never let anyone rush you into enrolling in a plan. If a sales agent tries to push you into signing on the dotted line before leaving (or before you leave a sales presentation) — well, that’s a red flag right there. If the agent asks for your signature just to confirm that he has met with you, that red flag’s on fire. A legitimate agent doesn’t ask. A legitimate agent respects your desire to think it over.

Ask for the agent’s name and contact information. Then take your time, preferably several days, to consider the plan carefully. You can also use this time to do some checking so you can make an informed decision:

F Read any sales material carefully, especially the fine print.

F Check that the plan is the kind you want — a Medicare Advantage health plan, a stand-alone Part D plan, or Medigap insurance. If it’s a Medicare Advantage health plan, check what type. (I explain each type of Medicare health plan in Chapter 9.) The sales material should say clearly what kind of plan it is. (Starting in 2010, the type of plan must be incorporated in each plan name.) You can also

• Look up its name and ID number in the back pages of your Medicare & You Handbook.

• Call the Medicare help line at 800-633-4227.

• Go online to Www. medicare. gov and click "Learn More About Plans in Your Area."

F If you’re considering a Medicare HMO, PPO, or Special Needs plan, but want to continue going to your preferred doctors and hospitals, verify that the plan covers them. You can call the plan and ask for its provider directory, or you can look at the directory on the plan’s Web site. You can also ask your doctors and hospitals whether they accept the plan.

If you’re considering a Private Fee-for-Service plan, check with your local doctors and hospitals to find out whether they accept the plan. (PFFS plans currently aren’t required to have a provider network. Starting in 2011, they must have written contracts with providers so that consumers will then be able to find out more easily which providers accept specific PFFS plans.)

If you’re considering any kind of Medicare health plan, and want prescription drug coverage as well, confirm that it covers drugs. Many MA plans don’t.

Knowing what to do if you’re misled into joining a plan you don’t Want

Medicare has some consumer protections for people who believe they were tricked or misled into enrolling in a Medicare Advantage health plan they don’t want, or joined without understanding the consequences. Here’s what you can do:

F Call the Medicare helpline at 800-633-4227 (TDD: 877-486-2048), explain the circumstances, and say you want a special enrollment period to disenroll from the plan and either switch to another MA plan or be reinstated in traditional Medicare. Your case will probably be investigated.

F If you have medical bills that the plan refuses to pay — for example, if you were treated by doctors and/or a hospital outside of the plan’s provider network when you thought you were still covered by traditional Medicare — call the Medicare help line and ask to be reenrolled into traditional Medicare Retroactively — that is, dating back to the time you joined the plan. Medicare will then pay any outstanding bills at its usual rate, and you’ll pay the usual share of the cost.

F If calling the Medicare help line doesn’t bring results, call again and ask to be put in touch with a caseworker at your regional Medicare office. Or ask the help line for the phone number of the regional office that serves your state. Then call that office to explain what happened.

In certain situations, you have the right to disenroll from your present MA plan and either join another one or switch to traditional Medicare, even if you can’t show that you were misled by a plan. I explain these circumstances in Chapters 9 and 17.

You can also get in touch with your State Health Insurance Assistance Program (SHIP — check out Appendix B for contact info) for help if you need to. And you can report sales agents who use unethical tactics to the offices of your state’s insurance commissioner or attorney general (these phone numbers are in the state pages of your telephone directory).

Chapter 12

In This Chapter

^ Recognizing the importance of comparing plans carefully

^ Making lists to compare plans effectively

^ Comparing Medicare drug plans on the Internet

^ Getting personal help to compare drug plans

Edicare advises people who are choosing a Medicare prescription drug plan to consider the three Cs — Cost, coverage, and convenience. That’s perfectly true. But I say add three more Cs — Compare, compare, compare! And even a fourth: Do it Carefully! I can’t emphasize this point enough: Comparing plans carefully is the single most important step you can take in finding the Part D plan that’s best for you. It may save you unexpected hassle. It’ll certainly save you money.

"Well, yeah," you say. "But what about the fact that I’m faced with more than 80 drug plans in my area? And they’re all different!" I know that the number of plans makes choosing just one — let alone the right one — seem a daunting prospect. But take heart, because you don’t have to grope your way through the multitude of all of those plans. In this chapter, I demonstrate a strategy for navigating the Part D maze that focuses only on Your Needs.

First, I explain why comparing plans properly is better than the less-than-ideal alternatives you may be considering. I also share how to make two simple (yet essential!) lists of your needs and preferences to help you get the most out of an invaluable tool: the online Medicare Prescription Drug Plan Finder. I walk you through this tool step by step so you can whittle all those plans to a manageable few in the fastest and most effective way. I then show you how to drill down into a plan’s details to help bring you to a final choice. Finally, I suggest ways of getting personal assistance comparing plans, if you need it. In essence, this chapter’s purpose is to help you avoid that queasy feeling that often comes after making an important decision — did I do the right thing?

Understanding the Need to Compare Plans Carefully

There’s a famous scene in Indiana Jones and the Last Crusade Where Indy and his enemy choose what each thinks to be the Holy Grail from an array of goblets. The evil Nazi picks a gold one, and instantly dies a horrible death. "He chose. . . poorly," observes the ancient knight who’s been on guard duty for about 700 years. Indy picks a simple wooden cup. "You," intones the knight, "have chosen. . . wisely."

Well, maybe the Part D plan that’s best for you isn’t the Holy Grail exactly. But you still need to choose wisely to get it. And there are so many poor ways of choosing. Like these:

U Picking the same plan as your spouse, your best friend, your next-door neighbor, or your second cousin. (Why? Because they’re not you! They don’t take the same prescription drugs as you.)

U Choosing the plan with the lowest premium in your area. (Why? Because, unless you don’t take any drugs right now, premiums are far less important than co-pays in adding to your out-of-pocket expenses under any plan.)

U Agreeing to enroll in a plan that a sales agent pitches to you at a shopping mall, local pharmacy, senior center, or anywhere else.

(Why? Because the agent’s talking up the plan he’s paid to sell, without a thought to your personal needs or preferences.)

U Picking a plan from the marketing brochures that plans send to your home. (Why? Because these are advertising materials designed to make a sale, again without regard to your own circumstances and needs.)

U Deciding on the plan with the most familiar name. (Why? Because it won’t necessarily cover your drugs at the least cost.)

Using any of these methods to choose a plan isn’t much better than closing your eyes and jabbing a pin in a list, because none of them account for the prescription drugs that You Take. Your own set of drugs — down to the exact dosage of each and how often you take them — is the most important factor in picking the plan that’s right for you. It’s the essential key to choosing wisely.

In the next two sections, I explain how to recognize the best plan for your needs and why comparing plans carefully is worth the effort.

What’s the best plan, anyway?

In theory, the best plan is the one that provides any prescription drug you may conceivably need, not just now but also in the unforeseeable future. But that’s

Not how Part D works. No plan covers every drug, as I explain in Chapter 4. And unless you can find out the drugs that each plan covers and count them all up — a daunting task considering many plans have thousands of drugs on their formularies — it’s impossible to know which plan covers the most.

IJ$jAB££ I believe that the best plan has to be the one that covers all, or almost all, of the drugs you’re taking Now — meaning the time when you’re deciding which plan to sign up for — at the lowest out-of-pocket cost and with the fewest hoops to jump through to get those drugs. If it turns out later on that you need a drug that’s not on your plan’s formulary, you can ask your doctor whether an alternative formulary drug may work as well for you (as explained in Chapter 16). Otherwise, you can try using the exceptions process to ask the plan to cover your prescribed drug (see Chapter 4) or, if you’re turned down, you can appeal the decision (see Chapter 19).

You can also change to another Part D plan at the end of the year during open enrollment (or during the year in certain circumstances, as explained in Chapter 17). In fact, it’s wise to compare plans annually, because they change their costs and benefits each year, so the plan that’s best for you this year may not be as good for you next year.

Is comparing plans Worth the effort?

Comparing plans carefully is definitely worthwhile! Doing so tells you

U Which are the three or four plans that cover all of your prescription drugs but cost you the least out of pocket over the whole year.

U Which of these plans has the fewest or no restrictions for your drugs. (Different kinds of Restrictions — prior authorization, quantity limits, or step therapy — are described in Chapter 4.)

U Which of these plans gives you the best discounts if you choose generic drugs or want to receive your meds by mail order.

U Which of these plans has the most reasonable Co-pay structure — that is, the different amounts you pay in each tier of charges — in case you need more meds later in the year. (For example, Plan X may charge a co-pay of $45 for all of its nonpreferred brands, whereas Plan Y may charge more than $100 for drugs in its own nonpreferred brand tier.)

U Whether you’re going to fall into the Doughnut hole (also known as the coverage gap; see Chapter 15 for full details) with the set of drugs you take now and, if so:

• At which point in the year that’s going to happen.

• Whether that’s going to occur later under one plan than another.

• Whether any of these plans cover Your Drugs in the doughnut hole.

U Which of these plans have network pharmacies convenient for you.

U Which of these plans have a mail-order option, if you want one.

U Which of these plans allow you to fill your prescriptions in any state if you travel or live away from home for part of the year.

Certainly, you can find the answers to a few of these questions just by reviewing the Medicare & You Handbook, which gives some details of all Part D plans in your area. (Medicare mails this publication to you each October.) Or you can look at individual drug plans’ marketing brochures and Web sites. But you won’t find answers to all of your questions, or even to the most important one of all — which plans cover your drugs at the least cost.

The only really effective way of getting that critical information is to create the lists of your meds and plan preferences and use the online Medicare Prescription Drug Plan Finder, or get someone else to use it for you, as explained later in this chapter. This tool is also the Safest Way of choosing a plan. Why? Because when you do the comparison, you remain in control. You can’t fall for a sweet sales pitch — or worse, fall prey to a scam or a hard sell from some unscrupulous person who exploits your uncertainty for personal gain. (See Chapter 11 for the scoop on marketing scams and hard sells.)

Will you avoid Part D buyer’s remorse?

Most folks don’t compare Part D plans before choosing one, period. Surveys show that most often they rely on word-of-mouth recommendations or choose a plan sponsored by an insurer with a familiar name. So I’m guessing millions of Part D enrollees out there are paying far more than they need to for their drugs. Here are a few examples of how comparing plans carefully can save you money — and how failing to do so can teach you a hard lesson.

Bill’s story: Going by a Well-knoWn name

Back in November 2005, a few weeks before Part D started, I was having dinner at a friend’s house when another guest, Bill, told me he’d signed up with a plan. I asked how he’d chosen it. Well, he’d picked an insurer whose name he knew and felt he could trust. Fine, I said, but let’s do a comparison. We borrowed a laptop, and I ran the information for his six meds through the online Medicare Prescription Drug Plan Finder. It took about 15 minutes. The least expensive plan — also provided by a well-known insurer — turned out to cost about $1,000 a year less than the one he’d chosen. Because we were still within the open enrollment period, he was able to switch plans. Every year since then I’ve run the numbers for Bill. And every year the plan that worked out best for him was different than the plan he’d had the year before.

Joel’s story: Choosing the same plan as your spouse

Before he retired, Joel had health insurance from his company that covered drugs for both himself and his wife, Mae. When they needed Part D, Joel left it to Mae to pick a plan for both of them, because she took a lot of drugs, and he rarely took any, and they felt more comfortable being in the same plan. So Mae chose Plan X, which covered all of her drugs for a monthly premium of $61, and signed them both up. Mae was okay, but Joel was actually wasting money. Because he almost never needed drugs, he’d have been better off on Plan Y, which had a premium of $12.10 (the lowest in his area) and would’ve saved him $48.90 a month, or $586.80 over the course of the year.

Joanne’s story: Failing to research a sales pitch

Joanne was in the mall buying gifts for her grandkids when a sales rep invited her to sit down, have a cup of coffee, and talk about Part D. Joanne already had a plan and wasn’t thinking of changing it, but she was happy to take a load off and listen for a few minutes. What the rep said about Plan X sounded like a better deal than her current plan, so Joanne signed up on the spot. What she didn’t know was that for her set of drugs (two brand-names and two generics) Plan X ranked 27th in expense out of the 51 drug plans in her area. If she’d compared the plans according to the drugs she took, instead of listening to a sales pitch, she’d have found Plan Y. This plan had higher premiums than Plan X. But Plan Y charged lower co-pays for her generics ($4 per prescription rather than $8) and placed her brands in its preferred brand tier (with co-pays of $25), whereas Plan X placed them in its nonpreferred tier with co-pays of $55. So over the course of the year, Joanne paid $1,764 with Plan X, whereas she’d have paid $996 under Plan Y — a savings of $768.

Getting Organized With Two Crucial Lists

The information you must have at hand before comparing Part D plans properly — whether you hop online and use the Medicare Prescription Drug Plan Finder yourself or get someone else to do it for you — is very simple. All you need (besides your zip code, which you already know) is

U An accurate list of your prescription meds

A list of personal preferences that may make you lean toward one plan rather than another

In the following sections, I explain how to make your drug list complete and accurate in all of its details and how to note the kinds of preferences that may be important to you.

Creating an accurate list of your meds

Take a sheet of paper or use the worksheet provided in Appendix A. Have in front of you all of those bottles that contain the prescription medications you’re currently taking — tablets, capsules, liquid solutions, sprays, creams, or whatever form they come in. Then make a list of their exact names, their dosages, and how often you take them (frequency), Using the information provided on the pharmacist’s labels. Alternatively, you can ask your pharmacist for a printout of all of your prescription drugs.

Whichever method you choose, your list should look something like Table 10-1 — but with details for your own drugs, of course, in place of my examples.

I’m not just being persnickety in saying you should note down these three items — name, dosage, and frequency — exactly as they’re written on the container label. Following are some good reasons for being strictly accurate with each one:

U Exact medication name: Many prescription drugs have the same name but come in different forms, with their differences marked by a second word or combination of letters following the name.

For example, verapamil hydrochloride, a generic drug used to treat high blood pressure, irregular heartbeats, and chest pain, is shown in Table 10-1 as verapamil HCL ER. The ER Stands for extended release, but this drug is also available in three other variations: a plain form (without additional letters); an SR Form (sustained release); and a CR Form (controlled release), meaning the drug is absorbed into the body at different rates. Because this drug is a generic, a plan’s co-pays for any of these forms are likely the same — but the full price of the SR form is generally twice as much as the ER or CR forms, which makes a difference in the deductible or doughnut hole. So using the wrong initials in a plan search can distort your overall out-of-pocket cost results.

W Dosage: Using the wrong dosage in a plan search may also distort your cost results. Part D plans often charge the same co-pay for different strengths of the same drug — but not always. Even the full price may be the same for different dosages — but sometimes it isn’t. In this case, you pay more for a higher dosage in the deductible period (if you have one) or in the doughnut hole (if you fall into it), and also if the plan you choose charges Coinsurance (a percentage of the price) for your drugs in the initial coverage period rather than fixed co-pays. (I explain the difference between co-pays and coinsurance in Chapter 3.)

W How often you take your drugs: Of the three factors that can alter your out-of-pocket costs during a plan search, frequency is the most important. If, by mistake, you say you take a pill Once A day when in fact you take it Twice A day, the search results will show a cost that’s half as much as you’ll actually pay when filling your prescription at the pharmacy. That’s one surprise you don’t want! The converse is just as distorting. If, for example, you take a drug once a Week, But by mistake say in a plan search that you take it once a Day, The results will show an out-of-pocket cost seven times higher than what you’d actually pay.

The accuracy of the costs you’re quoted in a plan search depends very much on the accuracy of the drug names, dosages, and frequencies you enter into the plan finder. These details are equally important if you ask someone else — such as a customer representative on the Medicare telephone help line, or a counselor at your State Health Insurance Assistance Program (SHIP) — because this person, too, is going to use Medicare’s plan finder to assist you. (I explain how to find personal help with comparing plans later in this chapter.)

Drawing up a list of your plan preferences

Finding a plan that covers all of your drugs and costs you the least out of pocket may be top on your list of priorities. But chances are high that you’re going to identify several Part D plans that cover your drugs and vary by only a few dollars in the overall amount they charge. So consider some other factors that may be important to you, like these:

W Are the pharmacies in this plan’s network convenient to where I live?

Each plan has its own network of pharmacies, and going to a pharmacy outside that network costs you a lot more (maybe even full price) for your drugs. (See Chapter 14 for more on this topic.) Before finally selecting a plan, you need to be sure it has network pharmacies within a reasonable distance of your home.

W Does this plan have a mail-order option? If you prefer to receive all or some of your prescriptions by mail order in 90-day supplies (which costs less in many plans), you need to be certain that the plan offers a mail-order service. Some plans don’t. (I discuss mail order in more detail later in this chapter.)

W Does this plan restrict any of my drugs? Any plan may require you to ask permission before it’ll cover certain drugs through restrictions known as prior authorization, quantity limits, or step therapy. (I explain these requirements and how to deal with them in Chapter 4.) Because plans impose restrictions on different drugs, you’ll want to look for a plan that has the fewest restrictions on your drugs, or none at all.

W Will this plan cover my prescriptions when I’m away from home? If

You expect to travel during the year or live in another state for part of the year, you want a plan that covers your prescriptions at network pharmacies throughout the United States. Some plans offer a national service and some don’t. (None cover drugs purchased abroad.) See the later section "Searching for pharmacies if you travel or live away from home for part of the year" for more information.

W Does this plan have a good customer service track record? Plans that answer calls without keeping you on hold forever, respond to questions properly, pay their share of prescriptions correctly, and deal with complaints promptly are obviously preferable. Some plans provide more satisfactory customer service than others. See the later section "Assessing customer service" for details.

So how do you sort out the wheat from the chaff on all of these questions? The answers are available through Medicare’s online plan finder, and I show you how to find them later in this chapter. If you’d rather not go online yourself, you can get a hand comparing plans as explained in the later section, "Finding Personal Help to Compare Plans."

Introducing the Medicare Prescription Drug Plan Finder

Medicare’s online prescription drug plan finder is an interactive Web site that allows you to plug in details of your own prescription drugs to find out which plans cover them and approximately what each plan will charge you. In other words, this tool makes light work of an otherwise difficult calculation by doing the math for you automatically. I walk you through the process step by step later in this chapter.

You can use the plan finder to compare Part D coverage and costs within

W Stand-alone plans (PDPs), which provide Only Drugs and are the type of plan you need if you’re enrolled in traditional Medicare for your medical coverage

W Medicare Advantage plans (MAPDs) that provide prescription drugs and medical coverage in one package

W Special Needs Plans (SNPs), which in some areas offer comprehensive care for people in certain situations, such as living in a nursing home, being chronically ill, or receiving Medicaid services

Using the plan finder to compare coverage and costs for your drugs is essentially the same process within all these groups. But if you’re considering a Medicare Advantage or Special Needs plan, you need to compare details of the medical services they provide as well as drug coverage. I explain why in Chapter 9.

Everybody who wants impartial information about Part D plans uses the online plan finder. And I mean everybody! Not only people in Medicare but also doctors, pharmacists, social workers, counselors, advocates, and help groups. Gee, that sounds an awful lot like anybody who’s assisting a Medicare beneficiary in finding a Part D plan! Clearly, everyone depends on the plan finder. So it’s reasonable to ask: How reliable is it?

The plan finder is a complex and sophisticated computer program. And it’s unique: No other insurance system offers consumers a way to compare plans head-to-head to find the best deal. But of course such comparisons are only as reliable as the pricing information fed into them — in this case, by the Part D plans themselves.

Medicare officials say they rigorously monitor the accuracy of plan prices and, when errors are detected, remove all information about that plan from the Web site until corrections are made. Medicare also includes pricing accuracy as one of the measures in its quality assessment system, which rates individual plans from one star (poor) to five stars (excellent). Officials say the ratings, displayed on the plan finder, are based on Medicare’s own regular reviews and the number of complaints it receives from consumers.

Nonetheless, the plan finder isn’t free from glitches and errors. Here are some tips for avoiding, or minimizing, your chances of choosing a plan based on misleading information, as well as how to deal with it if you accidentally do:

W Know that Medicare posts new plan information for the following year in mid-October. This is when the potential for pricing errors is most likely, because every plan changes its costs and benefits from year to year, and huge amounts of detail are being uploaded onto the system. If you do a plan search at this time, recheck the information after open enrollment starts on November 15.

W After you’ve used the plan finder to choose the plan you like best, but Before Enrolling in it, it’s sensible to

• Double-check the accuracy of the drug information you entered into the plan finder — especially dosages and frequency.

• Print out the plan’s complete details for your set of drugs and keep this hard copy with your records.

• Call the plan to verify the full price it charges, or will charge for next year, for each of your drugs (at the dosages and quantities you specify) and your co-pay or coinsurance amounts during the

Initial coverage phase. If you’re considering getting your drugs by mail order, ask for those prices and co-pays too because they may be different. Keep notes of this conversation; the plan likely won’t confirm the details in writing.

W Bear in mind that although plans’ fixed costs, such as premiums,

Deductibles, and co-pay tiers, are invariably accurate on the plan finder, the prices quoted for drugs are an estimate. The exact prices can vary according to the pharmacy you go to and may fluctuate during the year.

W If you discover errors, report them to Medicare. Your information will be investigated and fed into its quality rating system. (See the later section "Discovering omissions or discrepancies on the plan finder" for some scenarios to watch out for and how to resolve them.)

W If you believe you were misled into enrolling in a plan due to

Erroneous pricing information on the plan finder, you have the right to ask Medicare for a special enrollment period to switch to another plan.

This scenario is when keeping a printout of the details you got from the plan finder comes in handy, because you probably need to show evidence.

The plan finder is now vastly more user-friendly than when it first went live in October 2005, and every year Medicare introduces improvements. So it’s possible that adjustments made for 2009 and beyond will slightly alter the navigation steps I explain in the rest of this chapter. I don’t expect such alterations to be great enough to trip you up as you follow the steps, though some of the link details may change. However, if you get stuck, know that every fall I update my "Quick Route Through the Medicare Drug Plan Finder" guide on the AARP Bulletin‘s Web site. You can find it at Bulletin. aarp. org/yourhealth/.

Moving Step by Step through the Medicare Plan Finder — The Fast Way

The Medicare Prescription Drug Plan Finder is loaded with information and offers several different kinds of searches. But in this section, I focus on a quick way of getting to a plan comparison without you having to give out your Medicare ID number or any other personal details, except for your zip code and drug list. This procedure is a totally anonymous process.

On a technical note, it’s also a process that’s best tackled with high-speed Internet access. You can do it with a dial-up connection, but your search will be slower and, for that reason, more frustrating. Perhaps you can use high-speed access at a friend’s house, a library, or a local senior center.

If you don’t have access to the Internet or just don’t feel up to doing an online search yourself, you can skip this section and go directly to the later section that suggests ways of getting personal help to find the same info.

JttNG/ If you have yet to create the all-important lists of your current prescriptions and your drug plan preferences, flip back to the earlier section "Getting Organized with Two Crucial Lists." Without this information at your fingertips, you can’t use the plan finder to full effect and won’t obtain accurate enough information to be able to compare plans properly.

The following 15 simple steps are designed so that you can sit at your computer and use them to navigate the plan finder, keystroke by keystroke. Sometimes I tell you to ignore certain questions or information. This is stuff you don’t need right now, but that you can return to later when you begin to compare plans in detail, according to your circumstances and preferences. (I consider those details in the next section.)

1. Go to Www. medicare. gov and click "Compare Medicare Prescription Drug Plans" on the home page.

If you’re doing this search anytime from mid-October through December 31, you’ll see two links — one that leads you to plan information for this year and the other to plan information for next year. Just click the one you need.

2. Click "Find & Compare Plans."

3. Click "Begin General Search" in the right-hand box.

Ignore "Begin Personalized Search" in the left-hand box.

4. Enter your zip code.

5. Ignore the age and health status boxes.

6. Select the "No" buttons for the next three questions and click "Continue."

Note: If you qualify for Extra Help, you need to click the third button and answer the questions that appear in order to obtain accurate information about your costs as you progress through the plan finder. So look at the specific information about choosing a plan in Chapter 5 before going further.

If you live in an area with a zip code that spans more than one county, you may now be directed to a page that asks you to select the county you live in.

7. Ignore this page (Review Current Coverage and Consider Options) and click "Continue."

8. Click "Enter My Drugs."

9. Enter the name of your first drug in the box and click "Search for Drug."

Another box appears, showing several drug names. Click the one you take and then click "Add Selected to Your Drug List." (You can also use the alphabetical list to search for your drug.) The drug you’ve selected then appears in a list box. This box also tells you whether a generic version of each drug is available.

10. Repeat this search for each drug you use and click "Continue."

When all of your drugs are on the list (but before clicking "Continue"), click the little box below the list to remove the check mark to ensure that lower-cost generics aren’t automatically substituted for your specific meds. (I explain how you can use the plan finder to discover more about using generics or other alternatives to lower your drug costs later in this chapter.)

11. Change the listed dosages and quantities to exactly match what you take.

This is the most critical step in the process in terms of finding out what you’ll pay for your drugs in different plans, as explained in the earlier section "Creating an accurate list of your meds."

• Dosage: If your exact dosage doesn’t appear beside each drug name on the screen, use the dropdown menu to find it and click that dosage. For example, if Lipitor is one of your drugs, you’ll see the default given as 10 mg, but you can change this dose to 20, 40, or 80 mg. (If no menu appears, only one dosage exists for that drug.)

• Exact form of drug: If your drug comes in different forms (such as extended or controlled release), these variations are identified by their initials and appear together with dosages on the same dropdown menu. Click the exact form you take.

• Quantities: Plug in how many doses you take each month. For example, if you take two pills a day, delete the default of 30 a month and type in 60. If you take a drug less frequently — say once every three months — use the dropdown menu to make that change. Click "Continue."

12. Choose whether to save your drug list.

Saving your list is a good way to avoid having to enter your information all over again if you lose it through a computer crash, or if you want to resume your drug plan search later on.

Select a password date that’s easy to remember, such as your birthday, and click "Continue." You’ll then receive a 10-digit ID number to use when retrieving your list. Make a note of the number and then click "Continue." (If you don’t want to save the list, click "Skip this Step.")

13. Ignore the invitation to select a pharmacy and click "Continue."

Selecting a pharmacy is unnecessary at this stage and may prevent you from finding plans that are the least expensive for your drugs. Searching for pharmacies separately, at a later stage, is a safer method. (I explain this search in the later section "Examining retail pharmacy choices.")

14. Arrive at the page headed Your Personalized Plan List.

What you now see is a list of five stand-alone drug plans, which the plan finder has ranked as the five least expensive plans for You At pharmacies in your area. The ranking automatically takes into account the cost of premiums and the drugs you’ve entered under each plan. If you want to see drug information for Medicare Advantage or Special Needs plans in your zip code instead, click those links at the top of the page.

To see more plans in your area, click the "10 per page," "20 per page," or "All one page" links at the bottom of the plan list. All the plans are ranked in Ascending Order of your likely total out-of-pocket costs for the year, so the plan shown first is the least expensive.

15. Pat yourself on the back for getting to where you can start narrowing down your options.

This page is actually the beginning, not the end, of your search, because it shows only the broadest information. But you can see — as the simplified version used as an example in Table 10-2 also shows — that it already gives you, in the second and third columns, an idea of what you can expect to pay out of pocket over the whole year in each plan, either at retail pharmacies or by mail order. (The dollar amount includes premiums, drug co-pays, and costs in the deductible and coverage gap phases, if applicable.)

The plan finder’s rankings are based on the expense of drugs purchased at the various plans’ in-network retail pharmacies, as you can see in the second column of Table 10-2. But the plan finder also shows likely costs for the same drugs when purchased through each plan’s mail-order service. These amounts are often (though not always) lower than the retail pharmacy cost. As a result, the order of the plans in terms of overall expense changes. Plan X may be the least expensive under the retail pharmacy option, but Plan Y may be least expensive under mail order. Note: The "Lower this cost" link in these two columns refers to alternative drugs that you may be able to take to reduce your costs further, as I explain later in this chapter.

Table 10-2 Example of a Personalized Plan List from the

Plan Finder Comparison Tool

Source: Medicare Prescription Drug Plan Finder, Www. medicare. gov, 2008.

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Careful, though — this page doesn’t give the whole picture. So don’t stop now. To make an informed choice among your plan options, you need to get cozy with their details, as I explain in the next section.

Drilling Down to Drug Plan Details

The list of plans — which I call the Main plan list — described in the preceding section’s Step 14 gives only a general idea of coverage and costs. Now you need to look at the details of each plan — or at least of the four or five plans that head the list.

To start, click the name of the first plan at the top of the left-hand column. This action brings up a page headed Plan Drug Details, which gives a lot of information about your drugs and costs under the selected plan. When you’re finished looking at this plan’s details, click your browser’s back button to return to the main plan list. You can then click the next plan’s name to bring up its details.

You can also look at the details of up to three plans side by side at the same time. Click the little box to the left of each plan’s name on the main list and then click the "Compare" button above.

TWNG/ Notice that this format is more compressed and doesn’t display the particulars as clearly as the full plan details pages. It also omits two important bits of information — whether your drugs come with any restrictions (such as prior authorization, quantity limits, or step therapy) and bar graphs that show your monthly out-of-pocket expenses over the year. That’s why I recommend looking at each details page in turn rather than taking the shortcut offered by this side-by-side comparison.

Here’s an explanation of what’s on each details page as you scroll down:

W Plan quality ratings: This rating system uses stars to indicate a plan’s performance in certain areas — such as customer service, getting prescriptions filled, accuracy of quoted prices, responsiveness to complaints, and so on — based on Medicare reviews and consumer complaints. Stars range from one (poor) to five (excellent).

W Fixed costs: These expenses refer to the plan’s monthly premium and annual deductible, if applicable.

W Estimated out-of-pocket cost over the whole year (including premiums):

This info appears in two dollar amounts — one shows your total costs if you buy all of your drugs from preferred retail pharmacies in your plan’s network (30-day supplies), and the other shows your total costs if you buy meds by mail order (90-day supplies). Mail order is usually (though not always) less expensive, but some plans don’t offer this option. (If you’re looking at this page partway through the year, the right-hand column shows total costs for the remainder of the year.)

W Drug coverage information: This breakdown shows the list of drugs you entered into Medicare’s online plan finder and the Tier (level of charges) that applies to each drug. Tiers typically range from 1 (least expensive) to 4 or 5 (most expensive), as explained in Chapter 3. (To find out the actual co-pays for these tiers, click "View Important Notes and Benefit Summary" on the menu at the top left of the page.)

If any of your drugs aren’t covered under this plan, the phrase NOT ON FORMULARY appears in the Tier (Formulary Status) column.

The columns farther to the right are very important. They show whether the plan places restrictions on any of your drugs — that is, whether you need to obtain the plan’s permission before they’ll be covered. These restrictions are prior authorization, quantity limits, or step therapy (as

Explained in Chapter 4.) When you make a final choice among plans, you may want to choose one with few or no restrictions.

W Monthly drug cost details at preferred network retail pharmacies: This chart shows what each of your drugs, if purchased from a preferred retail pharmacy in your plan’s network, will cost on a monthly basis at four different coverage levels:

• The period before you meet your annual deductible (if the plan has one)

• The initial coverage phase when you pay co-pays or coinsurance

• The coverage gap (doughnut hole) when you pay 100 percent of the cost of your drugs, unless this plan covers them in the gap or your costs aren’t high enough to reach it

• The catastrophic phase of coverage when you pay low co-pays after reaching a certain out-of-pocket expense limit

The left-hand column on this chart shows the full price of each of your meds under this plan — that is, the price the plan has negotiated with the manufacturers. You pay this price before meeting your deductible or while you’re in the coverage gap. If the full price also appears in the Initial Coverage Level column, it can mean one of two things — either the drug isn’t covered on the plan’s formulary or the full price is less than the co-pay would be, so the plan charges you the lower of the two. If you see a co-pay rather than the full price in the Gap column, it means the plan covers this drug in the gap.

W Monthly drug cost details when purchasing drugs by mail order: To

See a similar chart showing mail-order costs, click the "Show" button on the right-hand side. (If the plan doesn’t offer mail order, this option doesn’t appear.) Although mail-order drugs are always bought in 90-day quantities, this chart shows costs by the month (30-day quantities) to make comparisons easier.

W The local pharmacies within this plan’s network: Knowing which of your local pharmacies are in the plan’s network is important, because going out of the network costs you a lot more, possibly even full price. If you follow the instructions in the previous section, you won’t see any pharmacies listed. So how can you find out which of your local pharmacies participate in the plan? I explain how in the "Finding the pharmacies in a plan’s network" section later in this chapter.

W Out-of-pocket costs at a month-by-month glance: The bar chart at the end of the details page is a useful way to see how your expenses may change from month to month under this plan and whether (or when) you’re going to fall into the doughnut hole. (For examples, see Chapter 15.) If the plan has no deductible and your drug costs are too low to take you into the doughnut hole, the cost for each month is the same. Otherwise, different monthly amounts appear according to coverage level. For a detailed breakdown, click "Show explanation of these costs."

The bar chart you see on this page shows monthly costs if you buy your drugs at the plan’s in-network retail pharmacies. To see a similar bar chart for mail-order costs (if the plan offers this option) click the "Show" button on the Cost Estimator for Mail Order Pharmacy panel.

I go into more detail on these bar charts as they relate to the doughnut hole in Chapter 15.

W Filling prescriptions outside your home area: If you travel or live in another state for part of the year, you need a plan that covers your prescriptions at its network pharmacies anywhere in the U. S. To find this information, click "View Important Notes and Benefit Summary" on the menu at the top left of the page. The summary indicates whether you can use this plan to get your prescription drugs outside its service area.

W How this plan’s costs next year compare to its costs this year: When you’re doing a plan search during open enrollment (November 15 through December 31), the plan finder shows the details of Next Year’s costs and benefits by default. To see This Year’s information, click "Click here to display [year] plan data" at the top of the page. This option disappears on January 1.

If you click "View Important Notes and Benefit Summary" and nothing happens, your Web browser may be blocking pop-ups. Disable your pop-up blocker to access this information.

Making Additional Worthwhile Searches to Help Pick a Plan

If you’ve looked at the details of the first several plans on the main plan list, you may now have a rough idea of which ones seem the most promising. But, once again, don’t stop here. You need more information before making a well-educated choice among the handful of plans you’re now considering. In the following sections, I suggest other worthwhile searches, along with some relevant tips and warnings. These sections explain how you can use the online Medicare Prescription Drug Plan Finder to explore the following six topics in depth: examining drug coverage details, lowering your drug costs, determining mail-order prices, making pharmacy choices, assessing customer service, and filling prescriptions away from home.

When you’ve done these additional searches and are ready to make a final selection, print out the details of your top four plans and compare them, point by point. You can use the worksheet in Appendix A to make the comparison easier.

Looking at the nuances of drug coverage details

The plan finder shows a lot of information about drug coverage on each plan’s details page. But as you dive in, consider the info in the following sections to help you understand some nuances that aren’t immediately apparent or that may puzzle you.

Reviewing the pricing of covered drugs

When examining a plan’s details page for the prices of your covered drugs, some items may strike you as odd. Here are the explanations:

W If a drug is covered but shown as full price in the initial coverage period, that’s probably because the full price is lower than the co-pay, so the plan charges you the lesser of the two amounts. You can check this by looking at the plan’s usual co-pay for the relevant tier of charges — click "View Important Notes and Benefit Summary" on the menu at the top of the page. For example, if the full price of your Tier 2 drug is $15.50, but the normal co-pay for Tier 2 drugs is $20, you’re charged the lesser amount.

W If you see that Drug X is charged as a co-pay in the Gap column, whereas Drug Y is charged at full price, then Drug X is one of the drugs that this plan covers in the doughnut hole, but Drug Y isn’t.

W If you see an odd-looking price in the initial coverage column — for example, $23.97, rather than a nicely rounded dollar amount like $24 — it means that this plan charges coinsurance, not a flat co-pay. (Flip to Chapter 3 for more on coinsurance and co-pays.) So the price shown is a percentage of the full price.

W If you see that the cost of a drug in the Catastrophic Coverage column is higher than the standard catastrophic co-pay — $2.25 per prescription for generics or $5.60 for brand-names in 2008 ($2.40 and $6.00 respectively in 2009) — it means that you’re being charged 5 percent of the drug’s cost instead of the co-pay. Under Part D law, you pay either a co-pay or a maximum 5 percent of the full price, whichever’s the higher amount.

W If the full cost of your drugs is very high, you may see what seems to be a most peculiar profile for your monthly out-of-pocket expenses on the bar chart at the end of each plan’s details page. The chart may show a very large amount in the first month’s column (amounting to several thousand dollars) and very small amounts for the rest of the year. That’s because your drug costs are so high that you go through the deductible (if any), the initial coverage period, and the doughnut hole in the very first month. The small amounts thereafter are low-cost catastrophic coverage.

W If you look at the bar charts for drugs purchased by mail order, you may notice a strangely uneven profile in your out-of-pocket expenses over the year — for example, $400 in months 1, 4, 7, and 10, and $25 in the other months. That’s because you’re buying your drugs in three-month supplies, in advance. During the second and third month of each quarter, you have no outlay, except for the plan’s premium ($25 in this example).

Finding the pricing for drugs a plan doesn’t cover

Be aware that you can’t tell just by looking at the main plan list whether all of your drugs are covered by any particular plan — or whether a plan imposes restrictions on any of them. For that, you have to go to each plan’s details list and look at the Drug Coverage Information section (see the earlier section "Drilling Down to Drug Plan Details"). Drugs that a plan doesn’t cover have NOT ON FORMULARY next to their names. But wait, there’s more!

The main plan list and each plan’s details page show a dollar amount representing your estimated annual cost under each plan. But that amount Includes the full price of any drug that the plan doesn’t cover. The plan finder presents the information this way because, if it excludes the price for an uncovered drug completely, the overall cost of that plan appears lower than what you actually pay. Including the full price of an uncovered drug in the overall estimate gives you a better idea of what your out-of-pocket expenses are likely to be under that plan, especially when you’re comparing it with the costs of a plan that covers this drug.

A plan may cover a specialty drug (usually Tier 4 or higher) if you purchase it from a network pharmacy — but may not if you get it from the plan’s mail-order service. So when looking at mail-order prices, be sure to check out this info.

Discovering omissions or discrepancies on the plan finder

When you can’t find something you’re looking for, or the information seems wrong, there may be an explanation or it may be the result of a glitch or error on the plan finder. In the following scenarios, if you need to report the

Problem to Medicare, call the help line at 800-633-4227:

W You enter the name of a drug, and the plan finder doesn’t find it. First, check that the name you’re entering is spelled correctly or try to find it on the alphabetical list provided. Verify that the med in question is a prescription drug and not an over-the-counter drug or a vitamin — Part D doesn’t cover these kinds of medication. If nothing checks out, call Medicare to report the error, or to see whether there’s a reason this drug isn’t on the list.

W The plan finder doesn’t allow you to enter the dosage of your drug.

First, check that the dosage you’re trying to enter is correct, according to the medication label. If it’s right, report the omission to Medicare immediately. In the meantime, enter the dosage that’s nearest to yours — very often a plan’s co-pays are the same for similar dosages.

W The name of one of your drugs doesn’t appear in the cost details of the plan you’re looking at. First, check in the Drug Coverage column that the drug is in fact on your list of selected drugs. If it’s not, scroll down the page and add it to your list. If the drug is already on the list, but not showing up in the cost details, Medicare may have temporarily removed the information after discovering that this plan submitted incorrect pricing. Check back a day or two later. If it’s still not there, call Medicare to report the omission.

W The price given for a drug under one plan is very different from the price given under several other plans. Prices vary a good deal among plans, but mistakes happen. For example, occasionally plans submit the generic price to the plan finder rather than the specified brand-name price. You can check this by entering the name of the generic version on your drug list and seeing whether its price is the same as the price given for the brand-name. If it is, report that to Medicare immediately.

Checking to see whether the numbers add up

Many people like to do their own math to see if the calculations made on the plan finder actually add up properly. In some cases, checking the math yourself is easy to do. For example, if a plan has no deductible and your drug costs aren’t high enough to take you into the doughnut hole, your out-of-pocket costs will be the same each month. Just add the cost of the premium to your monthly co-pays — then look at the bar chart at the bottom of the plan’s details page to see whether the monthly totals displayed there are the same. Multiply this monthly total by 12 to check the annual out-of-pocket cost shown at the top of the page.

Calculating costs on your own is much trickier if the plan has a deductible and/or your drug costs are high enough to take you into the coverage gap — or through the gap and into catastrophic coverage. In these situations, your monthly costs fluctuate according to the coverage level — and the change from one to another most often doesn’t fall neatly at the end of any given month. The calculation is Possible. But quite frankly — and I speak from experience — you can go nuts trying to figure it out with pen and paper, or even with a calculator. In these circumstances, you probably need to have faith that the figures on the plan finder are pretty much correct.

Lowering costs with alternative drugs

You can dramatically reduce your costs if any of the brand-name drugs you take now have a generic version or a similar, older alternative that your doctor thinks would work just as well for your medical condition. I discuss these kinds of medications and why they’re less expensive than brand-name drugs in detail in Chapter 16. But in this section, I show you how to find lower-cost alternatives and their comparative prices on the plan finder.

In Step 10 of my navigation guide in the earlier section "Moving Step by Step through the Medicare Plan Finder — The Fast Way," I advise you to remove the check mark from the little box at the end of the list of drugs you’ve entered. That’s because, if you leave the box checked, the plan finder automatically replaces the names of your drugs with generics, if any exist. It can be a shock to see a totally unfamiliar name appear in your drug list without realizing what’s happened. And it seems to me that you’d prefer to find out the prices of your prescribed drugs Before Looking to see whether any lower-cost alternatives exist. That way, you know how much you’d save if you switch to the alternatives.

Here, I assume that you’ve searched plans on the basis of the drugs you’re taking now and have a shortlist of the plans that work out least expensively. Now you can see whether those costs can be brought down further. Choose a plan on the main plan list and click "Lower this cost" in the second column. Or click the plan’s name to get to the plan details page and click "Lower My Cost Share" on the menu at the top left. The page that appears on your screen will look like the example in Table 10-3.

Source: Medicare Prescription Drug Plan Finder, Www. medicare. gov, 2008.

Do your drugs have any lower-cost alternatives?

As you can see in the example in Table 10-3, the plan finder shows you which brand-name medication has a similar drug that can be used instead, which has a generic version, or which has no alternative. (Not all brand-name drugs have alternatives to date, as I explain in Chapter 16.) The list shows the percentage and dollar differences in co-pays or coinsurance between the brand-name drugs and the suggested alternatives. And it shows the savings over a month — in this case, almost $100.

If these cost savings sound too good to be true, let me assure you that this example is the result of an actual search using this set of drugs. What’s more, Zoloft isn’t covered on the formulary of this particular plan — the odd figure in the second column shows the full price — but the generic Is Covered, at a fraction of the price. (Under a different plan, which covers Zoloft as a nonpreferred Tier 3 drug with a co-pay of $54 a month, using the Tier 1 generic version reduces the co-pay to $4.)

On-screen, this page shows drug costs at retail pharmacies. You can also see the mail-order costs by clicking "Show Mail Order (90-Day Supply) Prices" at the top of the list. Opting for mail order may bring down your costs even further. Under the plan used for the example in Table 10-3, the similar drug (for Lipitor) and the generic (for Zoloft) each cost nothing under the mail-order option, reducing the overall monthly cost by half, to $15 a month.

As usual in Part D, savings on lower-cost drugs vary a great deal among plans. So after examining these details under one plan, look at similar cost savings for other plans on your shortlist by using the same steps. As a result, a different plan may now work out as the least expensive for you.

And what about that fourth column on the right-hand side of Table 10-3? This column shows whether any of the drug manufacturers’ patient assistance programs offer this drug for free or at low cost for eligible people with limited incomes. (I describe these programs as a possible way of lowering costs in the coverage gap in Chapter 16.) If a "No" appears in that column, it means the drug isn’t available under an assistance program. If a "Yes" appears, you can click it for details about the program — including the income limits for qualifying and how to apply.

One more useful bit of information is on this page. Notice the State Programs heading above the chart. These are State Pharmacy Assistance Programs (SPAPs) that are offered in some states for people whose incomes are limited but who don’t qualify for Medicaid. Clicking the link takes you to a page that provides details of the program in your state and how to contact it.

Which drugs would lower the cost?

If you find you can lower your costs with some alternative drugs, be sure to know their names and whether they require different dosages from the brand-name drugs you take now. You can locate this information on the plan finder by clicking the "Similar drug" or "Generic" link in the third column of the Lower My Drug Cost Share list. Doing so brings up a new list, which looks similar to the example in Table 10-4.

Source: Medicare Prescription Drug Plan Finder, Www. medicare. gov, 2008.

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This example shows Lipitor, one of a group of drugs called statins widely used to treat high cholesterol. Currently, it doesn’t have a generic form. But some older statins, such as Crestor and Zocor, do have generic versions, and these generics are the lower-cost options shown in the left-hand column.

Generics and similar older drugs sometimes require different dosages and/or quantities to achieve the same clinical effect as the brand-name drugs they’re copying. As you can see in Table 10-4, someone taking 20 mg of Lipitor once a day needs to take 40 mg of simvastatin once a day or 40 mg of pravastatin or lovastatin twice a day for these alternatives to work as effectively. Most plans charge the same co-pays for generics regardless of dosage or quantities (as this one does), but some may not. So be sure to check the co-pays when looking at your own drug list.

This chart also shows whether a drug manufacturer’s patient assistance program will cover the drug in question. When the given alternatives to the brand-name drugs are generics, as in this example, the answer is "No." If a given alternative is an older brand-name drug, the answer may be "Yes."

How do you use the information you find?

^jjfcDOQj^ If you discover an opportunity for lowering your costs through this kind of - search and decide that you want to try any of the suggested alternative drugs,

You need to talk to your doctor about whether the substitute may work well for you. Printing out the page that gives the names, dosages, and quantities for these alternatives and showing it to your doctor is a good idea.

Considering mail order

The third column of the main plan list shows at a glance an estimate of what each plan charges for your meds over the whole year if you buy all of them by mail order. If the plan offers a mail-order service — and if most of your drugs are Maintenance medications You take regularly, which makes getting them in 90-day supplies worthwhile — you may find that this option lowers your costs. (You can find examples of mail-order savings in Chapter 16.)

IJ$jWJ££ The savings generated by using this option vary a great deal among plans. You may find that the whole ranking of least expensive plans changes. For example, a plan that’s shown as the fifth least expensive under the retail pharmacy option may actually be number one under mail order. That’s because one plan may charge exactly the same for your set of drugs, whether by retail or mail order; another may charge a lot less for mail order over the whole year. For this reason, having a quick look at the mail-order costs for more than five plans is worthwhile. Some plans charge lower co-pays (as well as a lower full price) for mail order — for example, nothing for Tier 1 generic drugs, compared with $5 for retail. To see specifics, go to the details page of each plan you’re considering and click the "Show" button on Monthly Drug Cost Details at Mail Order Pharmacy.

If you’re considering mail order, reviewing the detailed list of monthly costs in the mail-order list for each plan is sensible. Some plans charge Higher Co-pays for mail order — for example, $7 for mail-order generics compared with $4 for generics from a retail pharmacy.

And here’s another important pitfall to watch out for: Some plans don’t cover certain drugs under their mail-order option at all, even though the same drugs are covered at a retail pharmacy. These are often Specialty drugs — the rarest and/or most expensive meds that are placed in a plan’s highest tier of charges — which you must buy at a pharmacy that stocks them. For example, one plan charges a monthly co-pay of $270 for a cancer drug purchased at retail pharmacies, but it charges full price — $743 — when the same drug is bought by mail order. The plan finder (at least in 2008) doesn’t highlight this fact. You have to look carefully at the mail-order cost list to find out. If the price of a drug shown in the Initial Coverage Level column on that list is the same as in the Full Cost of Drug column, the drug isn’t covered by mail order.

Examining retail pharmacy choices

Being able to use your plan coverage at retail pharmacies within a convenient distance from your home is obviously an important consideration when choosing a plan. (Even if you prefer mail order for your regular meds, sooner or later you may need a short-term drug, such as an antibiotic, purchased locally so you can start taking it immediately.) Most Part D plans, especially those offered by big insurance companies, have a wide selection of network

^NG/

Pharmacies, including large chains and smaller independent pharmacies. And many of the same pharmacies are within the networks of different plans.

When you’re enrolled in a Part D plan, you must go to one of the pharmacies within its network to ensure paying the price you expect. Going out of the plan’s network costs a lot more (unless you do so for an unavoidable, legitimate reason that your plan accepts, as explained in Chapter 14), and these payments don’t count toward the out-of-pocket limit that lifts you out of the doughnut hole (see Chapter 15).

The plan finder provides tons of info on pharmacy choices, but you need to tread carefully in your search, as I explain in the following sections.

Identifying the pharmacies in a plan’s network

In Step 10 of the earlier section "Moving Step by Step through the Medicare Plan Finder — The Fast Way," I advise you to ignore the invitation to select a pharmacy at that stage. Here’s why:

U If you click "Yes" (when asked "Do you want to select a specific pharmacy or pharmacies from which you prefer to purchase your drugs?"), a list of pharmacies in your area appears on-screen. But you have no way of telling which of these pharmacies are in any plan’s network.

U If you select a pharmacy on this list, the plan finder’s search engine looks first for plans that include the pharmacy in its network; your out-of-pocket costs are a secondary consideration. In other words, you may not find the least expensive plan.

U This list may include names that aren’t regular pharmacies, but may be doctors’ offices or hospital departments that dispense specialty drugs (such as medications used to treat cancer). Most plans don’t include these dispensers in their networks. If you select such pharmacies at this stage, the out-of-pocket costs that appear on the plan details page are going to be based on the full price of all of your drugs.

A better way to identify in-network pharmacies is to go to the individual plan details pages first, before searching for any pharmacy information, to get an idea of which plans are best for your set of drugs. Then you can find out which pharmacies are in the network of any plan you’re considering.

Click "View Pharmacy Network" on the menu at the top left of the plan details page to reveal a list of pharmacies within a certain distance of your zip code. (If this link doesn’t work, turn off your pop-up blocker.) In densely populated urban areas, this distance may be as little as half a mile. In rural areas, it may be seven miles or more. To widen the mileage radius, alter the distance shown in the box and click "Find Pharmacies."

The resulting list shows the pharmacies within the plan’s network, meaning that the plan covers any of its formulary drugs that you purchase there. The Pharmacy Type column to the right indicates which pharmacies supply certain kinds of drugs — for example, those that are Home infusion (self-injected) or Specialty Drugs (like some cancer medications). In the column at the far right, a Yes or No indicates whether pharmacies are preferred by the plan, meaning you may purchase your drugs at these locations at somewhat lower prices.

Comparing prices among in-network pharmacies

Even within the same plan’s network, different pharmacies may offer varying prices for your drugs. The out-of-pocket annual totals shown on the main plan list or at the top of each plan’s details page reflect the Average Of the prices offered by the plan’s Preferred Pharmacies in your area — that is, all those pharmacies with which the plan has negotiated the best discounts.

To see price differences for your set of drugs among specific pharmacies in each plan, follow these steps:

1. Go to the Main plan list, Scroll down to the My Pharmacies section, and click "Change Pharmacy Selection."

The result is a list of all the pharmacies within the smallest mileage distance of your zip code.

2. Expand the mileage radius to see more pharmacies farther away by scrolling down the page until you see the Change Criteria to Revise List of Pharmacies section.

You can alter the distance shown in the box by using the dropdown menu and clicking the distance you want. Then click "Update List." If the new list of pharmacies is large, you must click the "All one page" link to

3. Select your desired pharmacy by clicking the little box alongside its name and then click "Continue."

You can check up to two boxes, if you prefer. Either way, this step returns you to the main plan list.

4. Choose one drug plan by clicking its name.

The details page of your selected plan now appears with the prices charged at your chosen pharmacy. Its name is shown in the Full Year Cost and Monthly Drug Cost Details sections. If you selected two pharmacies, both appear in the Full Year Cost section. To see monthly cost details of the second pharmacy, click the "Show" button on the panel displaying that pharmacy’s name.

5. Observe whether your selected pharmacy is in this plan’s network.

See them all.

Be aware that this list shows All The pharmacies in your area and doesn’t specify which ones are in the network of any particular plan.

If it isn’t, note the warning message (above the Monthly Drug Cost Details section) that states: "You’ll pay 100% of the cost for drugs at this pharmacy because it is not in the plan’s network." In this case, only the full price of your set of drugs is displayed.

6. Return to the main plan list and repeat the process step by step to see prices at other pharmacies.

Comparing pharmacy prices this way can be a laborious procedure. So I recommend that for each plan you’re considering, check that a few familiar pharmacies are in the plan’s network (by clicking "View Pharmacy Network," as explained in the previous section) before doing anything else. Then select those pharmacies, one by one, as explained in Step 3. Make a note of each pharmacy’s annual overall costs for each plan you’re considering so you can compare them more easily. Remember that the prices of most pharmacies within each plan’s network vary only a little, but these prices can change during the year.

Iijj|kB£W The most important step is to make sure that the Part D plan you choose has at least one pharmacy in its network within a convenient distance of your home. And no, after you’re in a plan you Don’t Have to stick with one pharmacy from which to buy all or any of your drugs. If you have plenty of network pharmacies to choose from, you can always shop around among them when filling your prescription.

Knowing what to do if you already have a favorite pharmacy

You may especially like a certain pharmacy and you’d prefer to continue using it. Chances are pretty high that this pharmacy is in the network of at least one of the Part D plans on your shortlist, or even in all of them.

But what if it’s not? You can make a new search (using the pharmacy selection tool explained in the preceding section) to find another plan that has this pharmacy in its network. Then you need to compare this new plan’s costs with the prices of your shortlist plans. The difference may amount to only a few dollars over the year. On the other hand, the difference may be quite large. In that case, you need to consider whether cost outweighs convenience, or vice versa.

Assessing customer service

Naturally, some plans are better than others when it comes to providing good customer service and other kinds of performance. Medicare’s online plan finder helps you assess this, before you join a plan, by publishing quality ratings for each plan on its details page. This page includes an overall quality rating expressed in the form of stars and ranging from poor (one star), through fair (two stars), good (three stars), and very good (four stars), to excellent (five stars). This rating system gives a broad idea of how Medicare and plan enrollees have rated the plan overall.

But you can also drill down further to see how the plan rates on a range of specific performance measures — from how long it takes to get a live person on the phone to how well the plan handles appeals. To see this detailed breakdown, click the link labeled "Click to view more details on Plan Ratings" immediately above the stars. Doing so brings up a page showing three main areas of performance:

U Drug plan customer service: This category includes statistics on how long a plan keeps you or your pharmacist on hold during a call, how often such calls are disconnected in mid-conversation, how helpful the plan is in providing information, and how many complaints are filed about the plan.

*u Using your plan to get your prescriptions filled: This category indicates how easily enrollees get their prescriptions filled, complaints about the plan’s benefits and access to medications, complaints about problems met in joining or leaving the plan, and the frequency with which the plan delays making timely coverage determinations or appeals decisions.

*u Drug pricing information: This category focuses on the accuracy of prices submitted to the plan finder, the frequency with which a plan changes prices, and complaints about out-of-pocket costs, for example being charged the wrong amount for a prescription or a premium.

To see all the details in these three categories, click "Show All Plan Ratings" at the top of this page. Click "View Numbers" at the top left to see the actual numbers on which a plan’s stars are based (for example: time on hold — 25 seconds, or complaints about drug plan — 2.5 per 1,000 enrollees).

Medicare arrives at this information through regular monitoring of the plans, complaints from consumers enrolled in each plan, surveys among enrollees, and some independent assessments. You can see more details of how each point is measured by clicking "Click to view Data Sources" under each of the three category headings. If a plan is new to the Part D program, you may see the phrase "Insufficient data" next to some of the measures.

The more often enrollees let Medicare know how their plan is doing, the more useful these quality ratings become for people choosing a plan. So if you have a legitimate complaint about the plan you’re enrolled in, tell Medicare! Just call the Medicare help line at 800-633-4227 (877-486-2048 for TDD users) and say you want to file a Grievance — the Medicare term for a complaint. (I cover how to file a grievance in Chapter 19.)

Searching for pharmacies if you travel or live away from home for part of the year

If you travel a lot, you need a plan that allows you to fill prescriptions anywhere in the country. You can initially find out which plans do by clicking the "View Important Notes and Benefit Summary" link in the top-left menu on each plan details page. To confirm this information, check directly with the plan you select Before Enrolling in it, because some plans may allow this service for medical necessity only and not as a matter of convenience.

If you’re a snowbird or have any other reason to spend a large chunk of the year away from home in a particular place, you certainly need a drug plan you can use in both regions. So you probably want to search for pharmacies in both zip codes. If so, spare yourself a deal of confusion by saving your list of drugs when doing an initial search to find plans in your home area. Don’t Use your retrieval ID number to look at plans in the other zip code. Instead, enter your list of drugs all over again and save it a second time to get a different ID number. When the plan finder saves your original search, it automatically embeds the first zip code, along with the pharmacies located in that area. So if you use the same ID retrieval number for the other zip code, where pharmacies are different, the information can be distorted. For example, you may see a message saying, "You’ll pay 100% of the cost for drugs at this pharmacy because it is not in the plan’s network" — even if you haven’t selected a particular pharmacy. Creating a second search prevents this confusion from happening.

Finding Personal Help to Compare Plans

Not everyone has a computer or access to the Internet. Not everyone is familiar or comfortable with online searches. And you know what? That’s a-okay. Don’t feel badly if you’ve glanced at the previous sections on navigating the Medicare Prescription Drug Plan Finder and think "she may as well have written in hieroglyphics." You can find the same information by getting help from a live person.

Yes, at this point it may seem easier to choose a Part D plan by one of the unwise methods I mention earlier in this chapter — you know, signing up for the same plan as your spouse, opting for a plan with a well-known name, or listening to a sales pitch. But don’t go wobbly on me now.

The whole point of this chapter is to help you find the plan that’s best for You — the one that covers Your Drugs at the lowest cost. So don’t be put off when I say the plan finder is the most efficient way of getting there. The following sections list people you can turn to for help.

Asking family or friends for assistance

You may not be into computers, but I’m willing to bet someone in your family or circle of friends is. And, no matter how antsy you feel about asking for help, finding the right Part D plan is an excellent reason to do just that.

Maybe you have teenage grandchildren who are whizzes at electronics — and wouldn’t they be thrilled if you asked them to help! Never underestimate the ability of youngsters to pick their way through a complicated database without turning a hair. They’ve grown up with this stuff and know perfectly well that they’re more expert than you. (Even folks nifty on computers dread the day when their last child leaves home, depriving them of on-the-spot tech support.) Some families now make the process of helping their older members pick a Medicare prescription drug plan for the following year into an annual event. Lucky coincidence that Thanksgiving falls slap in the middle of the Part D open enrollment period, eh?

Of course, you don’t want to pitch even your favorite relative or best friend into the Medicare Prescription Drug Plan finder cold turkey — especially at Thanksgiving! Fortunately you can help her out. Give her your list of prescription drugs and the previous sections of this chapter to read and let her take it from there. After she finds a shortlist of two or three likely plans and prints them out, you can compare the options to make your final pick . . . for this year anyway.

Seeking help from professionals

By professionals I don’t mean people who are necessarily making a whole career out of giving Part D advice. I mean people who are trained to help, whether they’re being paid or they’re volunteering. By contacting any of the following three services, you can talk to someone who can use the plan finder to identify a Part D plan that suits you — and, best of all, the services don’t cost you a penny.

Calling the Medicare help line

You can call the official Medicare help line toll-free at 800-633-4227 (or 877-486-2048 for TDD users with impaired hearing) and ask a customer representative to find the two or three plans that best meet your needs and to mail printouts of their details to you. The rep just needs to know your Medicare ID number, your zip code, and the names of the prescription drugs you take, plus their dosages and how often you take them. Remember, making an accurate list of your drugs is essential. Flip to the section titled "Creating an accurate list of your meds" for help organizing this crucial information.

How helpful is the help line? Medicare uses contracted workers as customer representatives and gives them basic training, though their knowledge of Part D isn’t extensive. Feedback from consumers (and others who call the number to test the quality of the service) is mixed, as you may expect. Some callers get through to a rep in a jiffy; others remain on hold for ten minutes, or much longer. Some are satisfied with the information they receive; others aren’t.

So when you’re looking to find a Part D plan, it helps to be as specific as possible. Use the following steps to explain what you want:

1. Tell the rep whether you’re looking for drug coverage through a stand-alone prescription drug plan (PDP), a Medicare Advantage plan (MAPD), or a Special Needs Plan (SNP), as explained in Chapter 9.

2. Ask the rep to run a plan search using the details of your prescribed drugs — without substituting generics for them at this stage.

3. Tell the rep whether you qualify for Extra Help.

If you’re eligible for Full Extra Help (as explained in Chapter 5), say whether you want a plan that doesn’t charge a premium, or whether you’re prepared to pay part of the premium for a plan that may suit you better.

4. Ask the rep to do an initial search for the least expensive plans that cover your drugs Before Talking about pharmacy preferences or ways to lower your drug costs.

5. When the rep has completed this initial search and has a shortlist of possible plans, ask him to check whether each plan

A. Covers all your drugs

B. Places any restrictions (prior authorization, quantity limits, or step therapy — see Chapter 4) on any of your drugs

C. Has in-network pharmacies that are convenient to you

D. Offers a mail-order service that covers 90-day supplies of your drugs (if this option is important to you)

E. Covers your prescriptions at its network pharmacies in all 50 states and/or the territories (if this option is important to you)

6. Ask the rep to check the mail-order prices of your drugs in several plans to see whether these prices generate more savings.

7. Ask the rep to check whether you can reduce your expenses by using lower-cost drugs in each plan on the shortlist and, if so, by how much.

8. Ask the rep to mail you printouts of the three plans that best meet your needs.

The printouts should include full details of mail-order service, a list of each plan’s network pharmacies in your area, and details of the costs of lower-priced drugs in each plan. Ask the rep to confirm that these details are captured before mailing the printouts to you.

If the customer service rep refuses to give you all the info you ask for, ask to speak to the rep’s supervisor. You have a right to ask as many questions as you like to find a Part D plan that suits your needs. If the rep gives the impression that finding a plan for you is tedious or taking too much time, you also have the right to complain.

When you receive the printouts, you can compare each plan to make a final choice by using the worksheet in Appendix A, if desired.

Calling your State Health Insurance Assistance Program

State Health Insurance Assistance Programs, called SHIPs, provide expert free counseling services — specifically for people in Medicare — in all 50 states, the District of Columbia, Puerto Rico, Guam, and the U. S. Virgin Islands. Nationwide, more than 12,000 SHIP counselors (mainly trained volunteers) assist more than 2 million people every year with a wide range of Medicare problems, including how to choose a Part D plan. Go to Appendix B to find contact information for your local SHIP.

When you call your SHIP, you can schedule a face-to-face meeting with a local counselor or arrange to talk over a toll-free phone line. If English isn’t your first language, you can ask to speak with someone who knows yours. A SHIP counseling session may resolve a comparatively simple situation quickly and can be especially valuable if your circumstances are complicated.

When helping you choose a Part D plan, the SHIP counselor needs to know

Iw The names of your drugs, their dosages, and how often you take them in order to search the plan finder

U* Whether you’re looking for drug coverage through a stand-alone prescription drug plan or a Medicare Advantage health plan

U" Whether you’re eligible for Extra Help

The counselor can also help you choose a Medicare Advantage plan or apply for Extra Help, if necessary.

Calling your Area Agency on Aging

Every state and U. S. territory has an Area Agency on Aging (AAA) that provides a multitude of local services for people age 60 and over, including assistance with Medicare issues. In many cases, local AAAs rely on the SHIPs, described in the preceding section, to provide counseling on Medicare and

Part D. But some have their own trained volunteers who can give personal help in finding a Part D plan.

Find the number of your local AAA by calling the national Eldercare Locator toll-free at 800-677-1116. Calls are accepted on weekdays from 9 a. m. to 8 p. m. Eastern time. You can speak with someone in one of 150 languages, including Spanish. For more information on local services, visit Www. eldercare. gov.

Taking advice from other sources

You may well be able to get advice on picking a Part D plan from a variety of other sources. For example, many people report that they turn to their doctors, pharmacists, and insurance agents. Others receive help at senior centers, seminars, and info sessions of many kinds. Others are turning to new Part D plan-finding businesses that are popping up on the Internet.

Which of these info distributors can you trust to find a plan that meets your personal needs? Essentially, when can you believe what you hear — and when should you be skeptical? Following are some rules of thumb that may help:

U Just because someone is a professional doesn’t necessarily mean he knows enough about Part D to be of use to you in picking a plan. Doctors and pharmacists are professionals in their own fields and may be absolutely terrific at their jobs. But unless they’re able to run your particular set of drugs through the plan finder to search for the plan that covers your drugs and costs you least, they can’t really help you.

U Insurance agents are also professionals, and many of them are very knowledgeable about Part D. Others aren’t, and some are paid high commissions to sell a particular Part D plan (as explained in Chapter 11). If you have an agent who’s handled other insurance for you in the past and whom you trust, you may naturally turn to him to find a Part D plan. However, you should ask whether he’s able to use the plan finder to search for your best bet. If not, going to someone who can may be wiser.

U People on Medicare are often invited to info sessions at senior centers, retirement communities, hotels, or other venues and offered help in finding a Part D plan. Some of these sessions are an excellent value — for example, the ones run by volunteers from SHIP or other consumer groups. These trained people either show you how to use the plan finder yourself or run the numbers for you to help you pick a plan.

Other sessions are basically sales pitches for a single insurance company, promoting only the Part D plans it sells. If you hear information that dwells on a plan rather than your personal needs — or someone tries to sign you up for a plan on the spot — consider that an immediate red flag. And if whoever’s sponsoring the session offers you dinner on the house or other freebies, get out of there fast! These sneaky hard-sell tactics are real, as are outright scams, but I give you the tools to avoid them in Chapter 11.

U Wherever an opportunity opens up, some entrepreneur steps in to fill it. So the number of enterprising businesses offering to find Part D plans for seniors, usually for a fee, really isn’t surprising. If these operations are legitimate, whether offered through the Internet or by mail, they rely on the Medicare plan finder for their results. And if the results are good, you may consider your money well spent. But as of this writing, these plan-finding businesses are too new to assess whether they’re all legitimate or whether at least some may involve a new type of scam. In any case, why pay for a service you can get for free from someone you know you can trust, such as a family member, friend, or SHIP counselor?

What were they thinking. . . when they created so

Many Part D plans?

Strangely enough, nobody expected there’d be so many Part D plans. In fact, members of Congress were uncertain whether enough private insurers would offer enough Part D plans to provide competition, especially in rural areas. Some insurance honchos even predicted that the industry wouldn’t be interested in offering Stand-alone plans — the kind that provide only drugs and no other healthcare — because such plans had never existed before and were regarded as unprofitable. (The chief executive officer of one leading insurance company went so far as to call stand-alones "a harebrained idea" that just wouldn’t fly.) So when the law was written in 2003, it included a clause allowing the federal government to provide its own fallback drug plan in any area where fewer than two private plans entered the market. In other words, Congress guaranteed that at least two drug plans would be available to everyone on Medicare.

At least two! How quaint that seems today, with at least 50 stand-alone plans and dozens of Medicare Advantage plans plying their wares in every locality. What happened? As it turned out, the insurance industry — drawn by large federal subsidies — saw Medicare prescription drug coverage as a money-making bonanza.

The result was much like the California Gold Rush of the mid-1800s, with scores of insurers scrambling to carve out their share of a huge new market. That’s how Medicare beneficiaries came to be confronted with a bewildering number of choices.

So will there always be so many plans? Some experts anticipate that over time the market will shake out, with only a few of the largest plans — those that have attracted the greatest number of enrollees — remaining in business. This scenario would reduce the choices but, with less competition, probably also increase enrollees’ costs. Another potential turnaround is if Congress reduces or eliminates federal subsidies to plans, causing many of them to pull out of Part D. And yet another possibility, favored by some members of Congress and health policy experts, is to simplify plan choices by standardizing their designs — limiting them to maybe ten different options, each provided by a number of insurers at varying costs — in the way that Medigap supplementary insurance works today. Meanwhile, until any of those scenarios happen (or some entirely different development occurs), it’s safe to say the days of a Part D plan plethora won’t be over anytime soon.

Chapter 11

••••••••••••••••••••••••••••••••••••••••••••••<

In This Chapter

^ Understanding the differences between traditional Medicare and Medicare’s private health plans

^ Picking between traditional Medicare and private plans

^ Comparing and choosing among private Medicare health plans

Hoices, choices, choices. Part D has an abundance of them, and for many people, selecting just one drug plan seems a daunting task. But before you begin comparing drug plans (which Chapter 10 delves into), you really need to be clear about how you want your Medicare Medical Benefits delivered. This is a critical first step in the Part D plan selection process — and one that affects and automatically narrows your drug coverage options.

Broadly, Medicare medical benefits are available through two very different delivery systems:

Traditional Medicare: The original government system, in place since 1966, traditional Medicare works on a Fee for service Basis — Medicare directly pays a portion of the costs of any medical service it covers to any provider that accepts Medicare patients. You, the patient, pay a percentage of the cost, or in some cases a fixed amount, for each covered service you receive.

Private Medicare health plans: Collectively known as the Medicare Advantage (MA) program, these plans provide alternatives to the traditional system and are run by private, Medicare-approved insurers. Medicare pays each plan a monthly amount for each enrollee’s medical care. You receive your medical benefits through the plan of your choice and pay the charges required by the plan. Because plans vary greatly in their costs and benefits, you need to compare them carefully to pick the one that most suits your needs.

Whichever type of coverage you choose, you’re still part of Medicare. But be aware that traditional Medicare and private Medicare health plans have big differences. Oh yeah, and then there are all the variations among the five types of Medicare Advantage plans — Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Private Fee-for-Service (PFFS) plans, Medicare Medical Savings Accounts (MSAs), and Special Needs Plans (SNPs). Not to mention yet another type of plan that isn’t strictly part of the Medicare Advantage program — an HMO known as a Medicare Cost plan. Complicating matters further, Medicare even has rules about which kind of drug coverage you can choose depending on how you receive your Medicare medical benefits.

If you’re already sure you want either traditional Medicare or a private Medicare health plan for your medical benefits — or are already in one or the other and want to remain in it — pass this chapter over and head straight to Chapter 10, which explains how to compare drug plans. But if you’re undecided, read on.

In this chapter, I explain the differences between traditional Medicare and the various kinds of health plans that fall under the Medicare Advantage umbrella, as well as a few other individual programs. I also suggest items to consider when making a choice between traditional Medicare and a private Medicare health plan. And finally, if you opt for the Medicare Advantage system, I explain how to compare the MA plans available in your area to find the one that suits you best.

The Features of Traditional Medicare and Medicare’s Private Health Plans

Your choice of medical care directly affects how you receive drug coverage:

You can choose a stand-alone Part D plan — the kind that provides coverage only for prescription drugs — if you’re enrolled in one of the following:

• Traditional Medicare

• A Private Fee-for-Service (PFFS) plan that doesn’t offer drug coverage

• A Medicare Savings Account (MSA) plan

• A Medicare Cost plan that doesn’t offer drug coverage

I You can choose a Medicare HMO, PPO, SNP, PFFS, or Cost plan that provides both medical care and prescription drug coverage in a single package.

I You can’t have a stand-alone Part D plan while you’re enrolled in a Medicare HMO or PPO plan, Even if it doesn’t provide drug coverage.

Your choice of medical care also reduces the quantity of your drug coverage choices. For example, if your area offers 50 stand-alone Part D plans and 50 Medicare Advantage (MA) plans that include drug coverage (by no means an uncommon scenario in urban areas), your options are instantly halved.

Good news: Nobody’s going to ask you to take a quiz on all of this information! But you do need to do some homework to make an informed decision about getting your healthcare from either traditional Medicare or a private health plan — and, if you choose the latter, about the kind of Medicare Advantage plan you prefer. The more thoroughly you understand the differences among all of these choices, the more likely you’ll be content with the one you pick.

Table 9-1 shows at a glance the main differences among traditional Medicare and the three types of private health plans most commonly chosen by Medicare beneficiaries. The following sections go further, with detailed information on all the plan choices available to you. In each case, I explain how each type of plan works with prescription drug coverage, to what extent you can choose the doctors and hospitals you go to, the eligibility rules, whether extra benefits (more than traditional Medicare covers) may be available, and what kind of out-of-pocket expenses to expect.

Table 9-1 Key Questions When Comparing Traditional

Medicare and the Main Types of Private Medicare Advantage Health Plans

That doesn’t offer drugs.

(continued)

Table 9-1 (continued)

Costs and covers a few extra benefits.

Traditional Medicare

Also known as Original Medicare, Traditional Medicare is the program you’re in, unless you opt for one of the private plans I describe later in this chapter.

Eligibility: You must have Medicare Part A (hospital care) or Part B (outpatient care) or both, as explained in Chapter 1. To receive services, you can live anywhere in the United States or its territories.

I Choice of doctors and hospitals: You can go to any doctor or hospital that accepts Medicare patients (and is accepting new ones) anywhere in the country. You don’t need a referral from a primary care doctor to see a specialist. (To find a doctor enrolled in Medicare, visit www. Medicare. gov and click "Find a Doctor" on the home page. You can use this tool to search for a doctor by name, area, or specialty. Or you can always call Medicare at 800-633-4227 and ask for a list to be mailed to you.)

I Out-of-pocket costs: For outpatient care, you pay the standard Part B monthly premium ($96.40 in 2008 for most people; higher if your income is above $82,000 a year in 2008), annual deductible ($135 in 2008) and a percentage of the cost (20 percent in most cases, but possibly higher) of each Medicare-covered service. For hospital care, you pay a deductible ($1,024 in 2008) for each stay up to 60 days in a benefit period and co-pays for extra days, as explained in Chapter 1. There’s no limit on out-of-pocket costs. You can buy private Medigap supplementary insurance for

An extra premium to cover deductibles and co-pays in full or in part (see Chapter 1 for more about Medigap).

I Extra benefits: Traditional Medicare covers many kinds of healthcare, but by no means does it cover all the services you’re likely to need. For example, it doesn’t cover routine vision, hearing, and dental care. Medigap insurance may provide a few extra benefits, such as emergency care abroad and limited preventive care, depending on the policy you purchase.

I Prescription drugs: Traditional Medicare solely covers drugs used in hospitals or administered in doctors’ offices and clinics. You need to join a private stand-alone Part D plan, for an additional premium, to get coverage for outpatient drugs.

Medicare Advantage plans

You can choose among several very different types of plans within the Medicare Advantage program. Some types, such as HMOs and PPOs, have been part of Medicare for many years. (You’ll be familiar with the way these work if you’ve previously been in an HMO or PPO sponsored by an employer.) Other types of MA plans are much newer: Private Fee-for-Service (PFFS) plans, though available earlier, only became widespread from 2006 onward. Medicare Medical Savings Accounts (MSAs) and Special Needs Plans (SNPs) have been available in Medicare only since 2004. The following sections explain the key features of each type of MA plan.

Health Maintenance Organizations (HMOs)

Health Maintenance Organizations (HMOs) offer Managed care. This is a healthcare delivery system designed to hold down costs, typically by requiring primary care doctors to act as gatekeepers in referring patients to specialists and other services. HMOs operate locally in limited geographical service areas — usually a county or even a zip code. The same HMO may offer costs and benefits different in one service area than in another that may be right next to it. Following are the main features of HMOs:

I Eligibility: You must have Medicare Part A and Part B and live within the service area of the plan you select. You can’t join an HMO if you have end-stage renal disease (ESRD) — but if you develop it when already enrolled, you can remain in the plan.

I Choice of doctors and hospitals: You must be treated by doctors and hospitals within the plan’s network of contracted providers in the service area, except in an emergency or if you urgently need care. You usually need a referral from your primary care doctor to see a specialist. (If the plan offers a Point of Service Option, however, you can go out of network for a higher co-pay.) An HMO can supply you with its list of providers to help you find out in advance whether it covers your preferred hospitals and doctors.

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U Out-of-pocket costs: Whether you pay a premium in addition to the Part B premium depends on the plan. Co-pays for specific services are often less, but sometimes higher, than those in traditional Medicare. Some plans set a limit on out-of-pocket spending in the year, usually on specified services. If you go outside of the plan’s provider network (unless you have a Point of Service agreement), you’re responsible for the full cost of treatment, except in emergencies.

U Extra benefits: Some plans offer vision, hearing, and/or dental services (though the extent of this coverage varies a great deal among plans); routine checkups; and other extras, like health club memberships. These bonuses are usually reflected in higher premiums.

U Prescription drugs: Not all HMOs offer prescription drug coverage. If you join a plan that doesn’t, you can’t get coverage from a stand-alone Part D plan.

Preferred Provider Organizations (PPOs)

MA plans that offer managed care with fewer restrictions than HMOs are known as Preferred Provider Organizations (PPOs). Regional PPOs cover large areas, maybe several states. Local PPOs operate within smaller areas, such as in one or several adjacent counties. Their features include the following:

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U Eligibility: Like HMOs, you must have Medicare Parts A and B and live within the service area of your selected plan. You can’t join a plan if you have end-stage renal disease (ESRD), but you can stay in a plan if you develop this illness after enrollment.

U Choice of doctors and hospitals: You can go to a doctor or hospital outside of the plan’s provider network — but, if you do, it’ll cost you more in co-pays. You don’t need a referral to see a specialist. A PPO can give you its list of network providers so you can see in advance whether your preferred doctors and hospitals are covered.

U Out-of-pocket costs: The plan you select determines whether you pay a premium in addition to the Part B premium. Co-pays for specific services are different from those in traditional Medicare (often less, but sometimes higher). Some plans set a limit on out-of-pocket spending in the year, usually on specified services. Naturally, going to out-of-network providers (except in emergencies or for urgently needed care) costs more, often a lot more, though typically not the full cost.

U Extra benefits: Some plans offer vision, hearing, and/or dental services (though the extent of this coverage varies a great deal among plans); routine checkups; and other extras, like health club memberships. These are usually reflected in higher premiums.

U Prescription drugs: Not all PPOs offer prescription drug coverage. If you join a plan that doesn’t, you can’t purchase coverage from a stand-alone Part D plan.

Private Fee-for-Service (PFFS) plans

Private Fee-for-Service (PFFS) plans don’t offer managed care. They directly pay providers for each covered service, similar to the way traditional Medicare works (which sometimes leads consumers to confuse the two). Here are the main features of PFFS plans:

U Eligibility: You must have Medicare Part A and Part B and live in the service area of the plan you select. You can’t join a plan if you have end-stage renal disease (ESRD) — but if you develop it when already enrolled, you can remain in the plan.

U Choice of doctors and hospitals: You can go to any doctor or hospital that accepts the plan’s conditions and payment rates, anywhere in the country, and you don’t need a referral to see a specialist. But many providers don’t accept PFFS plans, and it isn’t easy to find out in advance which do, except by asking doctors and hospitals directly. (However, starting in 2011, PFFS plans must have written contracts with providers.) In addition, providers are allowed to accept or reject the plan for each service visit. So if the plan covers your care from a particular doctor or hospital once, there’s no guarantee that you’ll be covered next time.

U Out-of-pocket costs: Whether you pay a premium in addition to the Part B premium depends on the plan. Co-pays for specific services may be different from those in traditional Medicare — either lower or higher. Some plans set a limit on out-of-pocket costs in the year, usually on specified services. If you’re treated by a provider who doesn’t accept the PFFS plan’s payment rates, you’re responsible for the full cost of treatment, except in emergencies.

U Extra benefits: Some plans offer vision, hearing, and/or dental services (though the extent of this coverage varies a great deal among plans); routine checkups; and other extras, such as health club memberships. These add-ons are usually reflected in higher premiums.

U Prescription drugs: Not all PFFS plans offer prescription drug coverage. If you join a plan that doesn’t, you can enroll in a stand-alone Part D plan to obtain coverage (unlike HMOs and PPOs).

Medicare Medical Savings Account (MSA) plans

Medicare Medical Savings Account (MSA) plans work very differently from other Medicare Advantage plans. Medicare gives an MSA plan a certain amount of money for each of its enrollees; the plan then deposits a portion of this money into a special health savings account for you. You draw on the money in the account to pay for medical care. If you use up the entire amount, you then pay 100 percent of your medical costs until you’ve reached the plan’s deductible limit. Beyond that limit, the plan pays all of your costs for Medicare-covered services for the rest of the year.

MSAs offer the following features:

U Eligibility: You must have Medicare Part A and Part B. You can’t enroll in an MSA if

• You have health coverage through Medicaid, the Department of Veterans Affairs (VA or CHAMPVA benefits), the Department of Defense (TRICARE military benefits), or the Federal Employees Health Benefits program

• You have other heath coverage (like a retiree plan) that would cover all or part of the MSA deductible

• You have end-stage renal disease (ESRD)

• You’ve already chosen to receive Medicare hospice care for a terminal illness (which is covered under Part A; see Chapter 1)

• You’ll live in the U. S. for fewer than 183 days in the year

U Choice of doctors and hospitals: You can go to any doctor and hospital, but the cost may be lower if you choose a provider that has a contract with the MSA plan to treat its enrollees. If the MSA offers this option (and not all do), you can ask the plan for a list of providers.

U Out-of-pocket costs: This type of Medicare Advantage plan has no premium (aside from the Part B premium) and no co-pays. You pay the full cost of a medical service out of the money deposited in your health savings account. After this money is used up, you pay 100 percent out of pocket until you meet your deductible. The account deposit and deductible amounts vary from plan to plan. For example, if the deposit is $1,500 and the deductible is $4,000, your maximum out-of-pocket expenses in the year would be $2,500. (Some other examples for account deposits/deductibles in 2008 include: $1,000/$2,750; $1,250/$2,275; $1,300/$3,000; $1,575/$5,000.)

As long as you use the money in your account to pay for services that are covered by traditional Medicare, they count toward your deductible. After meeting the deductible, you pay no more for the rest of the year. If you don’t use all the money in your account, the balance rolls over and is yours to use the following year — regardless of whether you enroll in the same plan or another plan.

U Extra benefits: You’re free to use the money in your account for

Services not covered by Medicare (for example, routine eye and hearing exams), but these payments don’t count toward your deductible.

U Taxes: MSA accounts aren’t taxed, as long as they’re used for what the IRS calls "qualified medical expenses." Each year you must report your account withdrawals to the IRS, using Forms 1040 and 8853, even if you aren’t otherwise required to file an income tax return.

U Prescription drugs: MSA plans don’t cover prescription drugs. You can enroll in a stand-alone Part D plan to receive drug coverage. You can use your MSA account to pay for your Part D premiums and co-pays, but these expenses don’t count toward your MSA deductible.

Special Needs Plans (SNPs)

Special Needs Plans are relatively new additions to the Medicare Advantage program and aren’t available in all areas. They’re similar in structure to HMOs or PPOs (which I describe earlier in this chapter), but each individual SNP serves people in only one of the following specific categories:

U People who live in institutions (such as nursing homes)

U People who are eligible for both Medicare and Medicaid

U People who have at least one chronic or disabling condition (such as congestive heart failure, mental illness, diabetes, or HIV/AIDS)

I cover SNPs in more detail in Chapter 18. Here are their key features:

U Eligibility: You must have Medicare Parts A and B and live in the service area of your selected plan. To be accepted into an SNP, you must fall into the single category (one of the three previously described) that the plan serves. You can’t join an SNP if you have end-stage renal disease (ESRD), unless the plan specifically offers care for this condition.

U Choice of doctors and hospitals: If the SNP works like an HMO, you must go to the doctors and hospitals within the plan’s provider network, except in emergencies or for urgently needed care, and you need a primary care doctor to refer you to a specialist. If the SNP works like a PPO, you can go out-of-network for a higher cost and don’t need a referral to see a specialist. The plan may assign a care manager to help coordinate your needs for healthcare and other services in the community.

U Out-of-pocket costs: The plan you select determines whether you pay a premium in addition to the Part B premium. Co-pays for specific services are often less, but sometimes higher, than those in traditional Medicare. Some plans set a limit on out-of-pocket spending in the year, usually on specified services. If your plan requires you to see only in-network providers, going outside of it would make you responsible for the full cost of treatment, except in emergencies or for urgently needed care. If you have Medicaid as well as Medicare, your Medicaid program may not pay the SNP’s premium (if it has one), and you may pay different co-pays than those charged in traditional Medicare and Medicaid.

U Extra benefits: SNPs come with a built-in extra benefit in that they focus on your special circumstances or health condition and coordinate the services you need accordingly. Some plans offer vision, hearing, and/ or dental services (though the extent of this coverage varies a great deal among plans); routine checkups; and other extras, like health club memberships or fitness classes. These bonuses are usually reflected in higher premiums.

U Prescription drugs: All SNPs must offer prescription drug coverage.

Three other types of Medicare health plans

Three types of plans don’t fall within traditional Medicare or the Medicare Advantage program and aren’t available in all parts of the country:

W Medicare Cost plans: These plans work like HMOs (which I describe earlier in this chapter), but, unlike MA plans, you can join a Medicare Cost plan if you have only Medicare Part B. If you go to doctors and hospitals outside of the plan’s provider network for Medicare-covered services, traditional Medicare pays for your services, leaving you responsible for paying the usual costs and deductibles that apply in traditional Medicare. You can join a Medicare Cost plan at any time (if it’s accepting new members), and you can also disenroll from it and return to traditional Medicare at any time. If the plan doesn’t offer prescription drugs, you can enroll in a stand-alone Part D plan.

U Programs of All-Inclusive Care for the Elderly (PACE): These plans combine medical, social, and long-term care for frail people age 55 and older who are eligible for nursing home care but live in the community. All of them cover prescription drugs. PACE programs are covered in more detail in Chapter 18.

U Medicare demonstration and pilot programs: These are special projects that Medicare uses from time to time in specific parts of the country to test improvements in Medicare health coverage. If you want to know whether any demos or pilots are available in your area and how they work, call Medicare or your State Health Insurance Assistance Program (SHIP). See Appendix B for contact information.

Deciding between Traditional Medicare and a Private Medicare Health Plan

Knowing the key differences among Medicare’s various health delivery systems — the traditional program and each type of private health plan, as described in the previous section — is essential in deciding which one to choose. Only you can make that decision. However, in the following sections, I highlight broader points to keep in mind when considering whether traditional Medicare or a private health plan is right for you. (I exclude PACE plans and demonstration or pilot programs here because their availability is limited.) I also touch on a situation that may not allow you a personal choice — being in a specific health plan chosen by an employer or union.

Weighing the systems

When you join Medicare and intend to rely on it for your medical needs (that is, if you aren’t going to be receiving full benefits from elsewhere, such as an employer or union health plan), you automatically receive your care from the traditional Medicare program Unless You specifically choose to switch to one of Medicare’s private health plans. Similarly, if you’re already in either traditional Medicare or one of the private health plans, you remain in that plan Unless You take action to switch. In other words, you make the call.

Usually you can make this switch only during the annual open enrollment period from January 1 to March 31. (If you have Part D drug coverage, you also have from November 15 to December 31, as explained in Chapter 17.) Medicare allows some special circumstances for changing at other times of the year (see Chapter 17 for details). Also, you may have an opportunity to change your mind about the plan you join in certain situations, which I cover later in this chapter. Otherwise, you may find yourself locked into your choice, whether traditional Medicare or a private plan, for a whole year. So taking some time to consider which system you want is invaluable.

When making your decision, it may help to consider a wider perspective — how traditional Medicare and the Medicare Advantage program stack up generally in delivering healthcare. I take a big picture standpoint in the next several sections to touch on a range of issues: overall costs, premiums, co-pays, the long-term stability of costs and care, choice of providers and whether care is coordinated, extra benefits, and geographical service areas.

Thinking through these issues, and applying your personal preferences, enables you to settle on the Medicare system that works best for you. If you choose to go with a private health plan, see the later section "Comparing Medicare’s Private Health Plans and Making Your Pick" for details on comparing individual plans in your area. You can also use the online search tool suggested in that section to compare the details of individual plans with traditional Medicare’s standard offerings.

Overall costs

On the whole, most private plans offer lower costs to the consumer — sometimes charging no extra premiums — than traditional Medicare, for two reasons:

U Managed care plans (HMOs, PPOs, SNPs, and Medicare Cost plans) keep costs low by restricting care to their provider networks or by charging enrollees more to go out of those networks. They may also require enrollees to ask for prior authorization before covering certain kinds of treatment.

U Since a change in the law in 2003, Medicare has paid the private plans more on average for enrollees’ care than it pays for people enrolled in the traditional system. The extra payments allow the plans to charge enrollees less and/or offer better benefits than traditional Medicare.

(This fact accounts for most of the advantages in the Medicare Advantage system, but these extras could be much reduced if Congress acts to remove the extra payments, as some lawmakers and consumer groups are pushing for. I touch on this possibility in Chapter 21.)

JttNG/ However, Medicare’s private plans may not be a less expensive option for everyone. The Government Accountability Office, which investigates public spending for Congress, recently reported that private plans generally charge enrollees more than traditional Medicare for services used by people with greater healthcare needs — those who require more (or longer) stays in hospitals and skilled nursing facilities or who use home healthcare services.

Premium costs

Many people in traditional Medicare pay three premiums: one for Part B, one for prescription drug coverage (Part D), and one for a Medigap supplemental insurance policy (see Chapter 1 for the basics of Medigap). Medigap insurance can’t be used to cover out-of-pocket expenses in private plans, so dropping that premium to join one may save you money. But unless you have a private health plan that provides drug coverage and charges no premium of its own (as some do), you still pay three premiums — for Part B, for Part D, and for the health plan itself.

Co-pay costs

Private plans usually charge fixed dollar co-pays for doctor visits, which may be less expensive and more convenient than the percentage of the cost that traditional Medicare charges. But in comparing all plans, look carefully at the hospital co-pays. Traditional Medicare has a standard Deductible ($1,024 in 2008), which is the limit you’d pay whether you’re in the hospital for one day or up to 60 days in a benefit period. (I explain hospital benefit periods in Chapter 1.) The private plans usually charge a daily co-pay for a certain number of days in the hospital and often no co-pays between that number and up to 90 days or more. If you’re in the hospital for five days and your plan charges a co-pay of $100 a day for the first six days, your bill would be $500 — or less than half what you’d pay under traditional Medicare at 2008 rates. But if the plan charges $250 a day, the bill for five days would be $1,250 — or $226 more than traditional Medicare.

Furthermore, if you need to go back into the hospital within 60 days of being discharged, you won’t pay anything under traditional Medicare, because the deductible you’ve already paid for this benefit period covers your readmission stay. But under a private plan, you’re charged new daily co-pays for the number of days specified by the plan.

You can purchase a Medigap supplementary policy that pays your hospital deductible, Part B deductible, and co-pays in traditional Medicare, making your costs more predictable. Under Medicare rules, you can’t use Medigap to cover out-of-pocket expenses in a private health plan.

Cost and benefit stability

Private plans can change their costs and benefits each year — for better or for worse. Traditional Medicare is more stable, but it increases the Part B and hospital deductibles each year, and the 20 percent coinsurance it charges for most services also tends to rise as healthcare costs in general go up. Services that traditional Medicare covers generally don’t change, although from time to time new ones are added.

Care stability

JttNG/ Traditional Medicare is there, year after year. Private health plans can choose annually whether to stay in Medicare or withdraw, or whether to enter or exit a particular service area. Occasionally Medicare doesn’t renew a particular plan’s contract. If any such changes occur, affected enrollees are notified in advance and can switch to another private plan or to traditional Medicare, but this change can be a disrupting experience.

Provider choice

The main reason people give for choosing traditional Medicare (or staying in it) is that they can go to any doctor or hospital they please. Or at least any that accept Medicare patients, and most providers still do. In contrast, the Medicare Advantage plans that offer managed care limit the choice of providers to those in their networks. However, this may be considered a benefit rather than a restriction if care is properly coordinated, as explained in the next section.

The growth of PFFS plans in recent years offers an alternative to managed care in that PFFS plans allow you to go to any doctors or hospitals that accept their payment terms. That’s fine if all the providers you want in your area accept the terms. But not all do, and it’s not easy to find out which ones accept a PFFS plan’s terms in advance of joining it.

Care coordination

Managed care has generally gotten a bad rap, because many people see it as too restrictive, especially in terms of provider choice. But when care is coordinated properly, as it’s supposed to be in HMOs, SNPs, and Medicare Cost plans, it can be of great benefit to the consumer. Because your care is handled and monitored by a single local system, you’re more likely to be encouraged to get tests and screenings early enough to prevent serious health problems later on, and less likely to be prescribed drugs that may interact badly with each other, for example. PPOs may offer elements of coordinated care, but not if you exercise your right to go to out-of-network providers or see specialists without a referral. Traditional Medicare, PFFS, and MSA plans don’t feature coordination of care.

Extra benefits

All private plans must provide the same medical services as traditional Medicare. But they can also include extra benefits in their packages that are well worth having. Some plans with these extras don’t charge higher premiums, but most do — often quite a lot more. Look at any extra benefits carefully when comparing plans, because some provide significant coverage and others are very limited.

Geographical area

Considering your geographic location is important if you travel a lot or live in another state for part of the year. Traditional Medicare covers you anywhere in the U. S.; so do PFFS plans (at least in theory) and MSAs. However, HMOs, local PPOs, SNPs, and Medicare Cost plans require you to either go to providers within their local service areas or get preapproval to go outside the network. In a regional PPO, you can go to providers throughout the service region (sometimes several adjacent states) or get preapproval to go outside the network. Fortunately, all plans must cover emergency treatment or urgently needed care anywhere in the country. Some Medigap policies and health plans also cover emergency care abroad.

Recognizing when you may not have a choice

You may not be free to make a choice — either between traditional Medicare and the private plan system or among the private plans themselves — if you have health coverage from a current or former employer or union. Following are some of the ways this limitation can occur:

W Your current plan is a special one offered only to employees or retirees of the employer or union that sponsors it.

U Your current plan pays the premiums for a Medigap supplementary insurance policy. (This type of policy can be used only with traditional Medicare, not with a Medicare Advantage plan.)

Your current plan gives you coverage under a specific Medicare Advantage plan — an HMO, PPO, PFFS, or an MSA plan — meaning you can’t also be enrolled in the traditional Medicare program or any other MA plan.

JttNG/ Be aware that if you enroll in an alternative plan (unless it’s an alternative specifically offered by your employer or union) you may automatically lose your current coverage for you and your dependents and may not be able to get it back. Always check with your current plan’s benefits administrator before taking this step so you know the consequences.

Some people in this situation are faced with a real dilemma. For example, an increasing number of employers and unions are contracting with Medicare PFFS plans to cover their retirees. This move makes sense to sponsoring organizations with retirees all over the country, because in theory PFFS enrollees can go to doctors or hospitals anywhere. But some retirees have found that the only providers that accept their PFFS plan are far from their homes. If this Catch-22 happens to you, you can either put up with the plan or give up the retiree health benefit you’ve paid into for years. But first, why not holler loudly to the administrators of your employer or union plan to let them know what’s going on and see whether they can fix it?

Comparing Medicare’s Private Health Plans and Making Your Pick

The different types of Medicare private health plans (see the earlier section "Medicare Advantage plans" for details on each) aren’t just single plans. Rather, each type is offered by a number of different insurers. And a single insurer may offer several plans in one or more of these categories. The result? A lot of different plans to choose from, each with its own mix of costs and benefits.

I’m not going to pretend that making this choice is necessarily easy. If you’ve had experience making two or three plan choices under employer coverage in the past, you know the score. Well, sort of — deciding between two or three plans pales before the choices in Medicare. And if you’ve never had to choose a plan before, the number and range of choices may come as a big shock. After all, you’re not comparing apples to apples here. I mean, how do you compare one plan’s flat dollar co-pay for visiting a doctor with another plan’s percentage of the cost? How do you figure the trade-off between a relatively high co-pay for a hospital stay against a low premium?

Still, the difficulty of making that choice is no argument for not comparing plans. Whichever plan you choose may be a bit of a gamble, but insurance always is. And taking a hard look at the differences among the plans available to you makes your final decision an informed one. Regardless of the outcome, you can know you gave it your best shot.

In the following sections, I delve into how many private health plan choices you may face. Then I explain how to compare the details of the ones that interest you — either by making an online search that I walk you through, step by step, or by obtaining personal help. I also suggest ways of using this information to choose a final plan. Finally, I explain three circumstances in which you may be able to change your mind after enrollment and switch to traditional Medicare.

Determining how many plan choices you have

The number of Medicare private health plans for you to choose from depends very much on where you live. If you live in a heavily populated place, you probably have at least 50 plans available to you, including all the different types of Medicare plans. If you live in a very rural area, fewer than 15 plans may be available, and you may have far less choice among plan types. Rural areas often have no HMOs, local PPOs, or SNPs. They generally have one or two regional PPOs, one MSA plan, and a vast majority of PFFS plans.

Not all of these plans include drug coverage, so if you’re looking for a plan that combines medical and drug benefits in one package, this preference reduces your number of plan choices.

You can get a very rough idea of how many Medicare health plans are available to you by looking at your Medicare & You Handbook that Medicare sends out to all beneficiaries in October with information for the following year. Flip toward the back of the book to find a list of health plans in your state. (You can also read Medicare & You Online at Www. medicare. gov.)

However, you can’t always tell from the handbook which plans are available in your neck of the woods. Plans’ service areas may be described as being in select counties, or in a particular region of your state without specifying its borders. In other words, some of the plans listed may not operate in your zip code at all. What’s more, the handbook’s list gives only scant details about the plans — far too little info to make a reasoned choice among them. Fortunately, a better resource exists. Keep reading!

Finding a list of plans online

The fastest and most effective way of finding out your Medicare health plan options is to go to the Web site Medicare provides for this purpose. This useful tool allows to you compare plans head-to-head. (If you don’t have access to the Internet, fast-forward to the section "Getting personal help to compare plans" later in this chapter.)

To navigate the Web site, follow these steps, which represent consecutive pages on-screen:

1. On the Www. medicare. gov home page, under Search Tools, click "Compare Health Plans and Medigap Policies in Your Area."

2. In the box on the left-hand side, click "Find & Compare Health Plans."

3. Click "Begin General Plan Search" on the right.

4. Enter your zip code, ignore the request for age and health status, answer the following questions, and click "Continue."

5. Read this page if you want to review the details you’ve provided or see the general information offered, then click "Continue."

6. Click "Continue to Plan List" to compare only the health plans’ medical benefits at this stage. You can compare the plans’ drug coverage later.

7. Examine the list of all the Medicare health plans available in your area by scrolling down the page.

The total number of available plans appears at the top. Table 9-2 gives a few examples of the kind of broad information, labeled Plan Summary, you’ll encounter.

Table 9-2 Sample Plan Summary from Medicare’s

Plan Comparison Tool

As you can see in Table 9-2, the Plan Summary page gives a quick snapshot of each plan. The page shows at a glance the plan’s name, its type, its premium (in addition to the Part B premium), and whether it includes drug coverage, restricts doctor choice, or covers vision/dental services and physical exams.

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One column that appears in the Plan Summary on-screen, but is excluded in Table 9-2, is headed "Estimated Annual Cost for People Like You." This is a very rough estimate based on any information you give as to your age and health status in Step 4 of the previous list. A dollar amount is shown, even if you haven’t provided this detail. This tool doesn’t (and can’t!) provide a reliable guide to your out-of-pocket medical expenses over the year in any plan.

The plan descriptions in Table 9-2 are only examples. Plenty of plans within each type charge premiums higher or lower than those shown, or vary in their inclusion of drug coverage and extra benefits. The only type that’s always the same is the Original Medicare row, which shows details that are standard to the traditional Medicare program.

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If you want, you can cut down the number of plans on-screen to show only the kind you’re looking for. Go to the top of the page and click the "Show" button next to Select Criteria to Reduce Number of Plans Shown (optional). A menu of options will appear. Click the small box next to each kind of plan you want to see — for example, "Plans that include drug coverage." Then click "Apply Limits."

Be cautious of using this device to lessen the number of plans. For example, if you indicate that you want to see only plans that include drug coverage, you automatically exclude the traditional Medicare program from the list — yet it may be very useful to know what this program offers, as a kind of yardstick, when you’re comparing specific medical benefits among plans. Similarly, if you specify a premium limit, you exclude all plans with premiums over that dollar amount. So you don’t see plans that overall may give you a better deal — for example, somewhat higher premiums but lower co-pays. However, if you’re looking specifically for an SNP or an MSA, checking those options reduces the number of plans that appear on-screen to those you wish to see.

Digging for plan details

After obtaining your Medicare plan options (see the preceding section for tips on doing so), you’re now ready to look at the nitty-gritty details necessary to compare plans properly. These details include what the plan charges for visits to a primary care doctor or specialist, stays in a hospital, having an X-ray, or using an ambulance. Clicking any of the plan names in the left-hand column on the list brings up all of these details, and many more, for that plan.

Each details page provides a lot of information. Here are some guidelines to help you sort through it all:

V Comparing plans’ benefits side by side is useful. Fortunately, you can do so for up to three plans at a time. On the main list page, click the little box that appears alongside the name of each plan you want to see, then click "Compare" at the top or bottom of the page.

The three-plan comparison device is also very useful for comparing details of the traditional Medicare program (always called Original Medicare on this site) with some of the private health plans you’re considering. Scroll down the main plan list until you see Original Medicare and click the box beside it.

V The first chunk of information you see for any private plan is a quality assessment titled Plan Ratings. This section features stars, ranging from one (poor) to five (excellent), to grade how well the plan performs in categories like Getting Care from Your Doctors and Specialists and Managing Chronic Conditions. Select the "Click to view more details on Plan Ratings" link to see how Medicare arrived at these ratings.

This information can be useful in deciding which plans to avoid or in breaking a tie after whittling down your plan options to just two or three.

V In the next section, headed Important Information, you can see the plan’s monthly premium, as well as if you have a choice of doctors and hospitals, need a referral to see a specialist, or must limit yourself to the plan’s provider network. Look to see if the plan sets a cap on your out-of-pocket expenses — but be aware that this limit may apply only to certain services. You need to call the plan to find out which ones count.

V Pay special attention to the section headed Inpatient Care. Plans vary a great deal in the co-pays they charge for hospital stays — sometimes by hundreds of dollars. You should also compare these charges with the hospital deductible required under traditional Medicare. Look to see if you or your doctor must notify the plan before checking into the hospital for a nonemergency surgery or treatment.

V The Outpatient Care section gives details of costs to visit doctors and specialists, have outpatient surgery, or use an ambulance. It also states whether the payment method is a flat co-pay or a percentage of the cost. The following section gives similar details for outpatient tests, X-rays, lab services, and medical equipment (like wheelchairs). Look to see if you’re required to ask the plan for prior authorization before receiving any of the services listed in this section.

V If the plan includes Part D prescription drug coverage in its package, details appear in the Additional Benefits section. You can see lots of stuff here about the plan’s formulary, deductible, and co-pays for different kinds of drugs.

Here’s a special tip: Ignore these details! It’s impossible to tell what your drugs will cost under the plan from this information, or if they’ll be covered. Instead, you need to do a different search according to the Specific Drugs you take. You can do this by going back and entering your drugs, their dosages, and frequency in Step 6, and then clicking on "View Drug Benefits" at the top of the main page. Or you can follow the more detailed instructions for comparing drug plans on Medicare’s Part D plan finder tool that I walk you through in Chapter 10. Either way, you’ll find out more precisely what your out-of-pocket drug expenses would be over the whole year in a plan.

V If the plan includes coverage for extra services — such as dental, hearing, and eye care — these details appear at the bottom of the Additional Benefits list. You may notice that some co-pays are given for Medicare-covered services. Traditional Medicare provides for a few medically justified services in these areas — for example, eye exams for people who have diabetes or are at high risk for glaucoma; eye glasses for people who’ve had cataract surgery; hearing tests for people who may need medical treatment as a result; and dental work required for a medical procedure, such as jaw surgery after an accident. But the private plan may offer checkups and procedures (like teeth cleaning) that aren’t covered by traditional Medicare.

Getting personal help to compare plans

If you don’t have access to the Internet, or just don’t feel up to doing an online search yourself, you can still get the information you need to compare Medicare health plans properly. These alternatives include the following:

V Asking a family member or a friend to do an online search for you

V Calling the Medicare help line, your State Health Insurance Assistance Program (SHIP), or your Area Agency on Aging — which all give free help

V Talking to trained volunteers from a consumer group or senior center

These sources are the same as the ones I explain in Chapter 10′s "Finding Personal Help to Compare Plans" section. So go there for details and contact information.

Watching out for hard-sell marketing pressures and scams

Of course, you can obtain details in ways other than the options I mention in the previous sections. For example,

V You may receive advertising materials from Medicare health plans through the mail.

V You may chat with a sales representative by phone or at a pharmacy, shopping mall, or senior center.

V You may consult an independent insurance agent or broker.

Just remember that fancy direct mail pieces and energetic sales reps are pitching the health plan they’re supposed to sell. They’re not going to compare their plan point by point with their competitors’ plans! The same is true for some independent insurance agents, because they’re paid

Higher commissions for some plans than others. So the plan they pitch may not be the right one for you.

JttNG/ Selling Medicare health plans is a ferociously competitive business — so stay on your guard against being pressured into buying a plan you don’t want or don’t understand fully. Yes, regrettably, you can be persuaded into buying a plan that’s not right for you! That’s why I urge you to read Chapter 11, in which I explain how to protect yourself against unethical hard-sell tactics, as well as downright illegal scams. There, I break down Medicare’s marketing rules for plans, a list of matters to think about and check out before enrolling in a plan, and actions you can take if you’re misled into joining a plan you don’t want or understand.

Asking questions before you make your final choice

If you’re here, I’m assuming you’ve now decided on a Medicare health plan for your medical care rather than traditional Medicare, and also that you’ve narrowed your plan choices to a manageable two, three, or four. Now all you need to do is get down to that final one.

Getting all of your information in order helps a great deal. If you research plans using Medicare’s online comparison tool, you can print out the details of the few that interest you. If you call the Medicare help line at 800-633-4227 for the same information, you can ask the customer representative to mail you printouts for the plans you want to consider. You can also call the plans to ask for their info packets or visit their Web sites.

After you have this information, notice how the options can become tons clearer when you write down the key details alongside each other. The following questions are also reproduced in Worksheet 3 in Appendix A, along with spaces for writing out the answers for up to four plans. In the following list, I explain what action to take to find out specific answers to some of the questions. In all other cases, you can find the answers in your Medicare printouts, in the plan’s info packet, or on its Web site.

Dive into the decision-making process by asking the following:

V Will the providers (doctors and hospitals) that I prefer accept this plan?

You can obtain provider network lists from HMOs, PPOs, SNPs, and Medicare Cost plans by mail on request or from their Web sites. In the case of PFFS plans, you need to ask your local doctors and hospitals.

V Will this plan allow me to go to out-of-network providers for a higher co-pay?

V Will this plan cover my Nonemergency Healthcare needs outside of my home area?

In the case of HMOs, PPOs, SNPs, and Medicare Cost plans, you have to ask the plan precisely what its service area is, and in what circumstances it may cover treatment outside that region. (Information on service area boundaries isn’t given on the Medicare Web site or in the Medicare & You Handbook.) PFFS and MSA plans don’t have defined service areas.

V What will my fixed costs (monthly premium on top of Part B premium; annual deductible in the case of an MSA) be in this plan?

V Does this plan put a limit on my out-of-pocket expenses in a year?

You can get the cap amount from Medicare, the plan’s Web site, or the plan’s brochure. But you need to call the plan to find out which services count toward the cap.

V What will I pay to visit my primary care doctor in this plan?

V What will I pay to visit a specialist in this plan?

V What will I pay to stay in a hospital in this plan?

V What are this plan’s ratings for quality of care?

You can only find this information on Medicare’s online health plan

Finder or by calling the Medicare help line (800-633-4227).

V Does this plan offer benefits for vision, hearing, or dental care?

V Does this plan offer preventive care (screenings, scans, tests) that meet my needs?

V Does this plan cover routine physical exams?

Notice one question missing from this list: Does this plan cover prescription

Drugs? Yes, it’s an important question. But, as I explain earlier in this chapter, the type of Medicare health plan you choose directly affects how you can get drug coverage. So remember that

V If one or more of the health plans on your shortlist includes prescription drugs in its benefit package, you need to compare the drug coverage details separately.

V If you’re thinking about an HMO or PPO that doesn’t include drug coverage, you can’t add a stand-alone Part D plan to it. So if you want drug coverage, strike this health plan off your shortlist.

V If you’re pondering a PFFS, MSA, or Medicare Cost plan that doesn’t include drug coverage, you can enroll in a stand-alone Part D plan.

V If you’re considering traditional Medicare, which doesn’t include outpatient drugs, you can enroll in a stand-alone Part D plan.

Chapter 10 shows you how to compare drug plans effectively. Afterward, you can use Worksheet 2 in Appendix A to note the differences. Then, you can use this info together with Worksheet 3 to see which plan works best for you in terms of medical And Drug coverage. When you reach that point, it’s time to enroll, as explained in Chapter 12.

Knowing if you can make a change

What if you find, after you’re in a Medicare private health plan, that you don’t like it? Medicare allows you to switch plans outside of the regular open enrollment period only for several specific reasons, and unhappiness isn’t one of them! However, here are some escape clauses (which are all explained in more detail in Chapter 17):

V If your coverage in a Medicare health plan starts January 1: You have the right to switch to traditional Medicare or to another health plan during the first three months of the year, through March 31. However, you can’t use this opportunity to drop or add drug coverage.

V If you receive Extra Help: You can change to another Medicare health plan that offers drug coverage, or to traditional Medicare and a standalone drug plan, at any time during the year.

V If you joined a Medicare health plan as soon as you enrolled in Medicare at age 65: Medicare considers this first year in the program as a trial period. So you have the right to disenroll from the plan at any time within 12 months of first receiving coverage from it in order to switch to traditional Medicare and a stand-alone Part D plan. You also have a guaranteed right to buy a Medigap policy within 63 days of your plan coverage ending.

V If this is your first time in a Medicare health plan and you dropped a Medigap policy to join it: You have the right to return to traditional Medicare and be reinstated in Medigap at any time during your first 12 months in this plan.

V If you joined a Medicare Cost plan: You have the right to disenroll from it and switch to traditional Medicare at any time. If you received drug coverage from this plan, you can also switch to a stand-alone Part D plan at the same time.

Chapter 10