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Need Help with Your Prescription Drug Costs?  Help Is on the Way!

Beginning January 1, 2006 Medicare will offer insurance coverage for prescription drugs through Medicare-certified prescription drug plans.  If you currently have Medicare Part A and/or Part B, you can join a Medicare prescription drug plan starting November 15, 2005.  If you join by December 31, 2005, your Medicare prescription drug plan coverage will begin January 1, 2006.  If you join after December 31, 2005 but by May 15, 2006, your coverage will begin the first day of the month after you enroll.  Please note that if you join after May 15, 2006, you are likely to pay a higher monthly premium for your Medicare prescription drug plan.

Must I Join a Plan and What Are My Options?

• “NO CHANGE” OPTION - Stay with the traditional (fee-for-service) Medicare program and elect not to enroll in the new prescription drug plan because: (a) you already have coverage through your current employer, a former employer or another source you prefer; or (b) you simply aren’t interested in any Medicare prescription drug plans. If you already have prescription drug coverage from a Medigap (Supplemental Insurance) policy, you will get a detailed notice from your Medigap insurance company: (a) telling you whether or not your policy covers as much or more than a Medicare prescription drug plan; and (b) explaining your rights and choices. 

• ADD DRUG COVERAGE OPTION - Stay with the traditional Medicare program and elect to enroll in one of the new Medicare Part D prescription drug plans, which are explained below.

• CONVERT TO A MEDICARE ADVANTAGE PLAN OPTION -   Enroll in a Medicare-certified Medicare Advantage plan (similar to Preferred Provider or HMO plans) which offers Medicare Parts A and B coverage combined with prescription drug coverage. The 2006 Medicare and You handbook has been mailed to all Medicare enrollees. It provides information about the Medicare Advantage plans available in your area.

How Will the New Medicare Part D Prescription Drug Plans Work?

Medicare prescription drug plans may differ across the country; but, in general, here is how they will work:

• You will pay a monthly premium of about $37 in addition to any premiums for Medicare Parts A and B;

• You will be responsible for an annual deductible of $250;

• After you meet the deductible, your plan will cover 75 percent of your prescription drug costs from $250 to $2,250.  You will be responsible for the other 25 percent;

• From $2,251 until your out-of-pocket drug costs reach $3,600, you will pay 100 percent of your drug costs.  However, because you are part of a plan that is negotiating on your and other plan members’ behalf for the best price, you will still be receiving a discount;

• Once your out-of pocket drug costs reach $3,600 (including the $250 deductible and co-pays, but not your monthly premium), you will pay 5 percent (or a very small co-payment) of your drug costs for the rest of the calendar year and your plan will pay the rest.

What If I Don’t Think I Will Be Able to Afford to Join a Medicare Part D Prescription Drug Plan?

If you are a Medicare beneficiary with limited income and resources, you may qualify for extra help from the government:

• If your annual income from all sources is below $14,355 for an individual ($19,245 for a married couple living together), you probably will not have to pay monthly premiums or an annual deductible; and you could pay as little as $2 for your co-payments.  If you currently have: (a) both Medicaid with prescription drug coverage and Medicare; (b) Medicare and SSI (Supplemental Security Income for very poor elderly, persons who are blind, or who are disabled); or (c) if the State  of Michigan pays your Medicare premiums, you will automatically get this extra help. You do not need to apply.

• If your annual income is higher, but still modest, you may qualify for some extra help with your monthly premiums, annual deductibles, and co-payments.  To qualify, your resources must be limited to $10,000 for an individual ($20,000 for a married couple living together) or slightly higher. You may count an additional $1,500 per person if you will use those resources for burial expenses.  Resources include such things as bank accounts, stocks, and bonds.  Your house and your car will not be counted as part of your resources. Between June and August 2005, Medicare mailed an Application for Help with Medicare Prescription Drug Plan Costs (Form SSA-1020).  Recipients should complete and return this application as soon as possible.  If you did not receive an application in the mail, you can get one by calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778).  You may also apply online at www.socialsecurity.gov.

Where Can I Get Further Information and Assistance?

• All Medicare beneficiaries should have received the Medicare and You handbook in the mail.  It lists the Medicare prescription drug plans and Medicare Advantage plans available in your area. If you did not receive your handbook or have misplaced it, please call 1-800-MEDICARE.

• You will be able to get free, personalized information at www.medicare.gov on the web or by calling 1-800-MEDICARE (1-800-633-4227) for help in choosing a plan that meets your needs.

• You can also get free, personalized counseling from the Michigan Medicare/Medicaid Assistance Program by calling 1-800-803-7174.

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