Insurance and Payment Options
FAQs: The New Medicare Prescription Drug Coverage
What is the Prescription Drug Benefits (Part D)
For the first time ever, everyone with Medicare, regardless of income, health status, or prescription drug usage, will have access to prescription drug coverage. This new coverage begins on January 1, 2006. While information is available now and educational sessions are taking place in communities across the country, you can't enroll until November 15th. By now, you should have received your Medicare & You 2006 handbook which explains in detail what prescription drug coverage means to you and which plans are available in your area.
Medicare Advantage and Prescription Drug Plans have started their advertising across the country. You may want to find out more about some of these options.
What is the role or the patients' physician?
While CMS expects you to get a lot of questions from patients, CMS does not expect doctor's to take time away from their clinical responsibilities to help them decide which plan to select. This is a complicated program and ultimately, counseling needs to be done one-on-one. CMS asks that the doctor tell their patients, or an adult child or caregiver, to use the information below to determine the right plan for their needs.
When can patients enroll?
Enrollment begins on November 15, 2005 and runs until May 15, 2006. Similar to other insurance, if patients enroll after May 15, 2006, they will need to pay more for the Medicare benefit.
Is this plan just for people who are low-income?
No. While the insurance will be especially helpful for people with low-incomes, or those who have modest means (most seniors don't see themselves as low-income), this plan is for everyone. Some people will be enrolled automatically in a Medicare plan if they need extra financial assistance, e.g. if they are enrolled in Medicaid and Medicare, the so-called "dual eligibles". Others who may be eligible for extra help will get a letter from the Social Security Administration this summer telling them how to apply, or, they can contact the SSA themselves by calling 1-800-772-1213.
How will my patients choose a Medicare drug plan?
On October 13, patients will be able to compare all of the Medicare insurance plans. Information will be available on the CMS Web site www.medicare.gov and at 1-800-MEDICARE (1-800-633-4226). They will also receive a Medicare & You handbook in the mail.
State Health Insurance Assistance Programs (SHIP) will be another place to get information. Patients can call 1-800-MEDICARE to get the number for their local SHIP. And, local and community groups are also working together to help seniors pick the right plans.
How will the Medicare drug plans be different?
Private companies are setting up the insurance plans for Medicare, and, as a result, each plan will have slightly different characteristics. Some plans may use only certain pharmacies and others may cover only certain drugs. The cost also may vary slightly by plan.
How much will this new insurance cost patients?
The monthly insurance fee will be about $32. There is also a $250 deductible each year and a small co-pay for each drug.
Does this insurance cover all of the patients' drug costs each year?
No. After patients pay the deductible, Medicare will pay 75% of all drug costs, up to $2,250. Then, there is a gap in coverage, commonly referred to as the "donut hole". Specifically, this means that when a patient's total drug costs reach $2,250, they will need to pay the next $2,850 themselves until they reach $3,600. At that point, Medicare will pay 95% of all drug costs; this is the "catastrophic benefit".
What if patients have a Medigap policy?
If patients receive drug coverage through Medigap, they will get detailed information from their insurance company in September. This information will help them decide what to do.
What if patients already get drug coverage through their employer or through a union?
Patients will receive information from their employer or union that tells them if their current plan covers less, the same, or more than Medicare drug insurance.
If their current plan covers less than Medicare drug insurance, patients can:
- Keep their current plan AND join a Medicare plan for complete coverage.
- Keep their current plan. (However, if they join a Medicare plan later, they will need to pay more.)
- Drop their current plan and join a Medicare plan. (However, they may not be able to get their current plan back.)
- If their current plan covers the same or more than Medicare drug insurance, patients can:
- Keep their current plan. (If they join a Medicare plan later, they won't need to pay more.)
- Drop their current plan and join a Medicare plan. (However, they may not be able to get your current plan back.)
What about drug formularies?
The specific plans, including their formularies, will be available in October. Formulary information will be updated monthly on the CMS Web site.
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