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Starting January 1, 2006, Medicare now offers prescription drug coverage for everyone with Medicare. Anyone with Medicare Part A and/or Part B can join a Medicare prescription drug plan offered in their area. The coverage is offered through plans provided by insurance companies and other private companies.

Initial enrollment in the drug plan began Tuesday, November 15, 2005 and ended Monday May 15, 2006. If you joined a plan by December 31, 2005, your Medicare prescription drug plan coverage began on January 1, 2006. If you joined after December 31, 2005, your coverage is effective the first day of the month after the month you joined. The coverage is an option available to all Medicare beneficiaries but is especially important to certain categories of beneficiaries.

OPTIONS

  • Beneficiaries on limited income, $14,355 for a single person and with resources under $11,500 (or $19,245 for a married person living with his/her spouse and resources under $23,000) may qualify for extra help paying for your Medicare prescription drug costs
    • A person can enroll in the extra help program through the Social Security Administration.
    • A person will need to join a Medicare prescription drug plan for Medicare to pay for drug costs.
  • Medicare enrolled Medicaid beneficiaries in a plan if they had not enrolled by December 31, 2005.
    • Medicaid beneficiaries must join a Medicare prescription drug plan for Medicare to pay for drugs.
    • Medicaid will still pay for other health costs.
  • Beneficiaries on the state Pharmacy Assistance Program, such as the Kidney Health Program, are required to apply for the extra help program and are to keep any denial letter they receive from Social Security. This is important as it will determine the level of assistance they will receive from the Kidney Health Program.


Employer and Union Options for Working with Medicare Prescription Drug Coverage
You may be one of approximately 11.5 million people with Medicare currently covered by employer and union-sponsored ealth plans that offer prescription drug benefits, this includes:

  • Active employees and retirees
  • Spouses and dependents
  • Participants in private health plans (including church-sponsored plans) Participants in federal health plans (e.g., FEHB, TRICARE, VA) and
  • State/local government health plans

Medicare is providing incentives to encourage employer and union retiree plan sponsors to offer a variety of options to their participants.

Employer/Union Plan Options

  • Offer retiree coverage that takes the place of Medicare prescription drug coverage. Sponsors will receive tax-free Retiree Drug Subsidy” to reimburse a portion of their costs or retirees who do not join a Medicare drug plan. Participating employers and unions must provide retiree drug coverage that is “actuarially equivalent” – on average, of equal or greater value to Medicare standard prescription drug coverage, taking retiree premium contributions into account. Retiree would not join a Medicare drug plan. Note: If the retiree joins a Medicare drug plan, the employer/union cannot collect the subsidy.
  • Offer retiree coverage through a separate, stand-alone rug plan that supplements Medicare standard drug coverage. his plan does not replace Medicare prescription drug coverage, but adds to it. With this option, the retiree must join a Medicare drug plan to receive full prescription drug coverage. Retiree receives prescription drug coverage from a Medicare drug plan, and supplemental coverage from his or her employer/union plan. Note: The supplemental employer/union coverage does not count toward the retiree’s $3,600 true out-of-pocket limit.
  • Offer customized Medicare coverage with additional retiree rescription drug coverage. Employer/union purchases upplemental drug coverage from a Medicare drug plan, or contracts directly with Medicare to become a Medicare drug plan and provide the coverage. Retiree receives Medicare prescription drug coverage and employer/union supplemental coverage from the same entity. Retiree must join the Medicare drug plan the employer/union has chosen to get the additional coverage.
  • Employer/union may choose to pay part or all of retirees’ Medicare drug plan premiums. In this case, the retiree ust join a Medicare drug plan to get Medicare prescription drugcoverage. This option is available to employer/unions regardless of whether they also provide retiree drug coverage.

Employer/Union requirements
Employer/union drug sponsors are required to provide a disclosure notice to all people eligible for Medicare prescription drug coverage-including active workers, disabled workers, individuals on COBRA, retirees and their dependents-whether their current drug coverage is “creditable,” that is, whether thecoverage is, on average, at least as good as Medicare tandard prescription drug coverage. The disclosure notice may be included in other correspondence but must be provided by November 15, 2005. Note: This notice is very important because retirees will not have to pay a premium penalty to join a Medicare drug plan after May 15, 2006, provided they did not go without creditable coverage from another source for 63 consecutive days or longer.

Extra Help
People with limited income and resources (in 2005, resources of no more than $11,500 single; $23,000 for married couples) may qualify for extra help, even if they already have prescription drug coverage through their employer/union. You should compare the monthly premiums, annual and lifetime plan design caps and limits, co-payments, deductibles and coinsurance requirements of your employer/union plan versus a Medicare drug plan. Also check that your specific drugs, brand-name and generic are covered. Note: Even with creditable coverage, some retirees may find it to their advantage to sign up for a Medicare drug plan that costs them ess after all factors are considered.
A good source of information regarding your options is to visit your plan’s website, or call your benefits administrator.

For more information about how employer/union drug coverage can work with Medicare prescription drug coverage, visit http://www.cms.gov.

Social Security Administration (SSA)
1-800-772-1213

http://www.ssa.gov


MEDICAID beneficiaries whose prescription drugs are paid byMedicaid:

  • Your Medicaid prescription drug coverage is changing.
  • Medicaid will no longer pay for most of your prescription drugs after December 31, 2005.
  • Medicare started paying for most of your prescription drugs beginning January 1, 2006.
  • You will have continuous drug coverage and pay a small amount out of your own pocket.
  • You will have unlimited drug coverage (no longer limited to three per month)
  • You must join a Medicare prescription drug plan for Medicare to pay for your drugs. If you did not join a plan by December 31, 2005, Medicare enrolled you in a plan to make sure you did not miss a day of coverage.
  • You can call 1-800-MEDICARE (1-800-633-4227) to verify your plan.
  • You can also verify your plan through your pharmacy.
  • You have the right to change plans.
  • Medicaid will still pay for your other health costs.
    For information and/or assistance contact MEDICARE at 1-800-633-4227, TTY users 1-877-486-2048 or on the web at
    www.medicare.gov.
  • www.carxe.org - The CARxE Benefits Gateway - free online solution to the difficult task of selecting a prescription drug plan
  • My Medicare Matters - provides objective, unbiased information via one-on-one assistance from trained educators and is not affiliated with any insurance company or plan.
  • Locally you can contact the Area Agency on Aging of Harris County 713-794-9001 or the Access to Benefits Coalition 713-341-6186.

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