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Medicare Prescription Drug Coverage Basics
What Social Workers Need to Know
What are Medicare prescription drug plans?
Beginning January 1, 2006, prescription drug coverage will be available to
all Americans with Medicare. Every person with Medicare, no matter how they
get their health care today or whether they have existing drug coverage, will
be eligible for drug coverage under a Medicare prescription drug plan. Insurance
companies and other private companies will work with Medicare to offer these
drug plans. Medicare prescription drug plans will be available throughout the
country, and all plans will cover both brand names and generic drugs.
Medicare prescription drug plans provide insurance coverage for prescription
drugs. Like other insurance, if people with Medicare join they will pay a monthly
premium and pay a share of the cost of their prescriptions. Costs will vary
depending on the drug plan that is chosen.
Drug plans will vary in what prescription drugs are covered, how much someone
has to pay, and which pharmacies can be used. All drug plans will have to provide
at least a standard level of coverage, which Medicare will set. However, some
plans might offer more coverage and additional drugs for a higher monthly premium.
When a person with Medicare joins a drug plan, it is important for them to
choose one that meets their prescription drug needs.
What do I tell my clients about the Medicare prescription drug coverage?
The new Medicare drug coverage is complex, but it can also be a help in reducing
the costs of prescription medications. There are many ways to find additional
information about the Medicare prescription drug coverage plans:
When can people with Medicare join a Medicare prescription drug plan?
Those people who have Medicare Part A (Hospital Insurance) and/or Medicare
Part B (Medical Insurance), can join a Medicare prescription drug plan between
November 15, 2005 and May 15, 2006. If they join by December 31, 2005, their
Medicare prescription drug plan coverage will begin on January 1, 2006. If
they join after that, their coverage will become effective the first day of
the month after the month they join. For example, if someone joins on April
15, his or her coverage will begin May 1. In general, they can join or change
plans once each year between November 15 and December 31. If a
current Medicare beneficiary does not join a plan by May
15, 2006, they may have to pay a penalty if they
delay their decision to join by the May 15 th open enrollment deadline.
Is there additional assistance for people with limited income and resources?
People who qualify for extra help paying for Medicare prescription drug costs
will get coverage. The amount they pay out-of-pocket depends on their income
and resources. Beneficiaries with limited income and resources can apply for
extra assistance through the Social Security Administration or their State
Medical Assistance Office (Medicaid). For more information on who can get extra
assistance with prescription drug costs and how they can apply, call the Social
Security Administration at 1-800-772-1213, or visit www.socialsecurity.gov on
the web, TTY users should call 1-800-325-0778.
What if someone already has prescription drug coverage from a Medigap (Medicare
Supplemental Insurance) Policy?
Those who have an existing Medigap policy with drug coverage should get a
detailed notice from their insurance company telling them whether or not their
prescription drug coverage is, on average, at least as comparable to the standard
Medicare prescription drug coverage. If their Medigap coverage is comparable,
and they decide to keep their current drug coverage, they may be able to buy
a Medicare prescription drug plan later without having to pay a penalty.
What if someone has a prescription drug coverage from an employer or union?
Those who have prescription drug coverage from an employer or union should
get a notice from their employer or union that tells them if their coverage
is, on average, comparable to the standard Medicare prescription drug coverage.
If the employer or union plan covers as much or more than a Medicare prescription
drug plans the person with Medicare can…
- Keep their current drug plan. If they later join a Medicare prescription
drug plan their monthly premium will not be subject to penalty, or
- Drop their current drug plan and join a Medicare prescription drug plan,
but they may not be able to get their employer or union drug plan back once
they disenroll.
If the employer or union plan covers less than a Medicare prescription drug
plan, the person with Medicare can…
- Keep their current drug plan and join a Medicare prescription drug plan
to give them more complete drug coverage, or
- Keep their current drug plan. But, if they join a Medicare prescription
drug plan later, they will have to pay at least 1% more for every month they
waited to join after May 15, 2006, or
- Drop their current drug plan and join a Medicare prescription drug plan,
but they may not be able to get their employer or union drug plan back once
they disenroll.
What if someone has both Medicare and Medicaid (dual eligibles)?
Medicare is working closely with the Social Security Administration and is
expected to auto-assign people who are dual eligibles to a prescription drug
plan prior to January 1, 2006 . Coverage will come from a Medicare prescription
drug plan starting January 1, 2006 . Dual eligibles are permitted to switch
from their auto-assigned prescription drug plan to another approved plan. However,
if they disenroll from one drug plan without, at the same time enrolling in
another Medicare sponsored drug plan, they may lose any government sponsored
coverage for prescription coverage.
For questions concerning beneficiaries who have both Medicare and Medicaid,
contact your local SSA Office or the Social Security Administration at 1-800-772-1213,
or visit www.socialsecurity.gov on
the web, TTY users should call 1-800-325-0778.
November 2005
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