11/8/051 medicare prescription drug benefits employee workshop november 2005
TRANSCRIPT
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Medicare Prescription Drug Benefits
Employee Workshop
November 2005
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Purpose of This Workshop
To help you help someone else To give you an overview To help get you started To give you some resources
NOTE: We are not the experts!
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What is Medicare?
Different than Medicaid (low income) Health insurance program for
People age 65 and older People under age 65 with certain disabilities, and People of all ages with End-Stage Renal Disease
(permanent kidney failure requiring dialysis or a kidney transplant)
Part A – Hospitalization Insurance Part B – Medical Insurance Part C – Medicare+Choice (Medicare Advantage) Part D NEW – Prescription Drug Coverage
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Medicare Premiums
Part A No monthly premium, part of FICA tax
Part B deducted from Social Security check $88.50 per month for 2006
Part D ~$32 per month for 2006 Will vary if enroll in private plan
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Medicare if 65+ Year Old is Covered by Active Employee Plan Part A begins even if working and is
secondary (employer coverage pays first) Part B enrollment can be delayed with no late
sign up penalty Part D enrollment can be delayed with no late
sign up penalty if coverage is considered “creditable” – at least as good as Medicare Employer must send a notice by November 15,
2005
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Medicare Part D: What is it?
Currently, Medicare does not cover most outpatient prescription drugs
Medicare Modernization Act of 2003 adds this coverage as of January 1, 2006
Centers for Medicare and Medicaid Services (CMS) in charge of Part D
Part D coverage is voluntary coverage Most enrollees will pay a premium
Exception for lower income people Penalty for late enrollment (1% per month), if not
enrolled in a plan that is at least equivalent, on average, to Part D
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Medicare Part D: Standard Plan Design Premium: You pay a monthly premium in addition to
your Medicare Part B premium – the estimated average monthly premium is $32
Deductible: You pay the first $250 in drug costs before the plan begins to pay
Coinsurance: You pay 25% of your drug costs from $250 to $2,250; Medicare will pay 75%
100% Self-Pay Portion, called “The Donut Hole”: You pay 100% of your drug costs from $2,250 to $5,100
Catastrophic Coverage: After your total drug costs reach $5,100 and you have paid $3,600 in out-of-pocket costs, you pay only 5% of any costs above $5,100 for the rest of the year; Medicare will pay the other 95%
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Medicare Part D: Standard Plan Design
50% of Costs Paid
by Insurer ($2,113)
25% Co-Insurance Paid by Retiree($500)
Beneficiary Pays Next
$2,850 in Rx Spending
Initial Coverage Limit$2,250
$250 Deductible paid by Retiree
Plan Paid
75% Paid by Plan
($1,500)Beneficiary Paid
Catastrophic CoveragePlan Pays
95% of Costs
2006
Estimated Average Monthly Premium
$32
The infamous “donut hole”
100% Paid by Retiree
Stop-Loss - Member reaches $3,600 in
True Out-of-Pocket costs
5% Cost-Sharing (or $2/$5 Copays)Above Stop-Loss
Graphic by Preferred Care
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When Can Someone Join?
Between November 15, 2005 and May 15, 2006
If join by December 31, 2005, coverage will begin January 1, 2006
Otherwise, coverage will be effective the first of the month after the month person joins
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Medicare Part D: Private Plans Many private companies will offer prescription drug coverage that
qualifies under Medicare Part D. The companies will likely charge you a premium for this
coverage. According to CMS, there will be private drug plans in every
region (21 in NYS). Some private plans will offer
premiums below $30 per month plans with no deductibles, or deductibles lower than Medicare’s
standard $250 deductible plans with coverage that exceeds Medicare’s standard design in
other ways
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Medicare Part D: Low Income BenefitsCategory 1: you have both
Medicare and full Medicaid coverage
your annual income is below $9,570 if you’re single
your annual income is below $12,830 if you are a married couple
Monthly Premium $0
Annual Deductible $0
Coinsurance Not applicable
Generic drug cost $1 copay
Brand drug cost $3 copay
Cost if you’re in a nursing home
$0
Cost once drug expenses reach $3,600 in a year
$0
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Medicare Part D: Low Income Benefits
Category 2: you do not qualify for
Category 1 you have Medicare your annual income is below
$12,920 ($17,321 for a married couple)
your assets are below $7,500 ($12,000 for a married couple)
Monthly Premium $0
Annual Deductible $0
Coinsurance Not applicable
Generic drug cost $2 copay
Brand drug cost $5 copay
Cost if you’re in a nursing home
$0
Cost once drug expenses reach $3,600 in a year
$0
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Medicare Part D: Low Income BenefitsCategory 3: you do not qualify for
Category 1 or 2 you have Medicare your annual income is
below $12,920 ($17,321 for a married couple)
your assets are below $11,500 ($23,000 for a married couple)
Monthly Premium $0
Annual Deductible $50
Coinsurance 15% between
$50 and $3,600
Generic drug cost after $3,600
$2
Brand drug cost after $3,600
$5
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Medicare Part D: Low Income BenefitsCategory 4: you do not qualify for
Category 1, 2 or 3 you have Medicare your annual income is
below $14,355 ($19,245 for a married couple)
your assets are below $11,500 ($23,000 for a married couple)
Monthly Premium Sliding Scale
Annual Deductible $50
Coinsurance 15% between
$50 and $3,600
Generic drug cost after $3,600
$2
Brand drug cost after $3,600
$5
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Prescription Drug Choices
Keep employer-provided or union-provided coverage, if available
Elect coverage under Medicare Part D standard benefits through CMS
Elect coverage under Medicare Part D low income benefits if qualified Apply through Social Security Administration
Elect coverage under a private plan that qualifies under Medicare Part D
Keep EPIC as secondary coverage if qualified (NYS only)
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Medicare Part D: Your next steps If person has coverage from a former employer or union, find out
what their Rx benefit will be for 2006 Will coverage be continued? Will coverage be changed? Is coverage creditable? (notice to be sent by November 15) What is the type of medical coverage (Medicare HMO or
Medicare Advantage plan – see warnings on later slide) Determine whether you fit any of Medicare’s low income
categories Learn which private plan choices are available Verify that the plan you want covers the drugs you take Determine whether there is a specific pharmacy network Compare expected out-of-pocket costs under each available
option
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Medicare Part D: Your next steps (cont’d) If you have Power of Attorney (POA)
You can enroll person in a Medicare prescription drug plan You can fill out application to get extra help (low income)
on his/her behalf as well You do not have access to private health information. You
would need the person to complete a HIPAA form (authorizing the release of private health information to you); obtain from insurance carrier
Enroll between Nov. 15 and May 15 for 2006, if appropriate
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What do RIT retirees need to know? RIT will continue to offer RIT Rx in 2006
Copays increasing to our standard plan design: $10/$25/$40 for generic/formulary/non-formulary drugs
RIT Rx is at least as generous as Medicare Part D No late enrollment penalty for Part D later
RIT retirees do not need to take any action RIT retirees in Preferred Care Gold or Medicare Blue Choice
should definitely not enroll in a Medicare prescription drug plan FYI: RIT is applying to receive the employer subsidy available
from Medicare Retiree enrollment: October 31-November 18
Retiree meetings being held
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Some Friendly Warnings!
Medicare Advantage Plans (HMOs, like Preferred Care Gold and Medicare Blue Choice): Must choose that plan’s Rx coverage (if any) If they elect a standalone Medicare Rx plan, CMS will disenroll
them from the Medicare Advantage plan, and they will have only Medicare Parts A&B for medical coverage for 2006!
Watch out for fraud/scams: No one trying to enroll you in a plan can come to your door
uninvited No one can ask you to enroll before Nov. 15th
No one can ask you for personal information during marketing activities
Never give out personal information until you are certain the person or product is approved by Medicare
If you have questions or concerns, call 1-800-MEDICARE
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For More Information
Read the Medicare & You 2006 handbook mailed to Medicare eligibles in October (includes plans in the person’s region)
Contact Medicare www.medicare.gov
Select Search Tools to get personalized information Select Frequently Asked Questions to get answers to common questions
Call 1-800-MEDICARE (1-800-633-4227)/v and 1-877-486-2048/TTY To apply for the low income benefit, contact the Social Security
Administration at 1-800-772-1213/v or 1-800-325-0778/TTY; information about the low income benefit is available on the SSA website: www.ssa.gov.
Call the State Health Insurance Assistance Program for face to face assistance; New York State number is (800) 333-4114 go to www.shiptalk.org or contact Medicare to find the phone # for other states
Contact AARP www.aarp.org/medicarerx Call 1-888-OUR-AARP (1-888-687-2277)
Look for local Medicare-related events
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Your Questions??
NOTE: We are still not the experts!