August 18, 2005
Medicare Beneficiaries Should Compare Prescription Drug Coverage Options
(Fourth in a series)
Medicare beneficiaries who already have some kind of prescription drug coverage will have an important choice to make this fall, when enrollment begins for a new Medicare prescription drug benefit.
The new benefit, called Medicare Part D, will go into effect on Jan. 1, 2006. It was authorized by Congress as part of the Medicare Modernization Act of 2003. The new benefit ensures that all Medicare recipients will have access to some form of prescription drug coverage.
However, Medicare recipients who already have prescription drug coverage -- whether through an employer, a Medigap policy, the Veterans Administration, or some other program -- will need to evaluate whether the Part D coverage can enhance or replace their existing drug plan.
If you are a Medicare beneficiary, you can choose whether to enroll in a Medicare Part D prescription drug plan. If you decide to enroll, you will have an opportunity to sign up sometime between Nov. 15, 2005, and May 15, 2006. This is when you will be guaranteed your lowest premium for the Medicare prescription drug plan you choose.
If you have prescription drug coverage now, your plan administrator will let you know whether your current drug coverage is at least as good as Medicare prescription drug coverage. With this information, you’ll know whether you need to enroll in a Medicare prescription drug plan during this initial enrollment period to avoid paying a higher premium.
Following are options that people with Medicare may currently use to get prescription drug coverage and how these options may work with Medicare prescription drug plans.
Prescription drug coverage through an employer or union health care plan: Contact your employer or union benefits administrator before you make decisions about your prescription drug coverage. If you drop your employer or union coverage, you may not be able to get it back. Also, you may not be able to drop your employer or union drug coverage without also dropping your employer or union health coverage.
Medigap policy with prescription drug coverage: If you currently rely on a Medigap policy, enrolling in a Medicare prescription drug plan most likely will save you money. Currently, you are required to pay 100 percent of the premiums for your Medigap policy. If you sign up for a Medicare prescription drug plan, Medicare will pay about 75 percent of your premium -- that’s a savings of as much as $1,300 a year. Most Medicap prescription drug benefits don’t cover as much as a standard Medicare prescription drug plan will cover.
Veterans Administration drug coverage for enrollees: As a VA enrollee, you are not subject to a higher premium if you decide to join a Medicare drug plan at a later date. You may wish to consider whether it is more convenient to get your prescriptions locally under a Medicare prescription drug plan rather than from the VA hospital.
AIDS Drug Assistance Program (ADAP): Your ADAP will let you know how it will coordinate with Medicare’s prescription drug coverage. Because ADAP’s coverage is not as good as coverage under a Medicare prescription drug plan, you will have a higher premium if you don’t enroll in a Medicare prescription drug plan before May 15, 2006.
Medicare-approved drug discount card: Medicare-approved drug discount cards were a temporary option adopted by the federal government until the Medicare Part D plan goes into effect next year. You can continue to use your Medicare-approved drug discount card until you join a Medicare prescription drug plan or until May 15, 2006, whichever comes first. If you qualified for a credit on your Medicare-approved drug discount card, you may qualify for extra help paying for your Medicare prescription drug coverage, too.
Medicaid: If you are eligible for Medicare but currently get prescription drugs through Medicaid, you will automatically begin getting prescription drugs through Medicare beginning Jan. 1, 2006. Medicare will assign you to a drug plan, and you will automatically get extra help to pay for your prescription drugs.
To learn more about Medicare prescription drug plans and how they may impact your current prescription drug coverage, watch for the handbook Medicare & You 2006,” which Medicare will mail to you in October. Or call 1-800-MEDICARE, tell them you have prescription drug coverage now, and ask to speak to someone about your options.
You can also call your local State Health Insurance Assistance Plan representative at 1-800-551-3191.
(This column was prepared by the Montana Department of Public Health and Human Services. It is the fourth in a series of monthly articles about the new Medicare Part D prescription drug plans that will take effect Jan. 1, 2006. To read other columns in this series, visit www.dphhs.mt.gov and click on “New Medicare Prescription Drug Benefit” under Features.)
Page last updated: 06/14/2006
