Medicare and New and Existing

Opportunities for Financial Assistance

National Association of

Health Underwriters

June 2009

What we will cover today

What is the Medicare drug benefit (Part D)? Who can get extra help? How do you get extra help? How do you get drug coverage? Are there other programs that can help?

Six things you should know about the Medicare drug benefit

1. Medicare drug benefit began January 1, 2006 2. Anyone entitled to Medicare Part A and/or enrolled in

Part B can buy coverage3. All coverage through private drug plans4. You pay a premium as well as a deductible and

coinsurance up to a maximum of $4,350 in 2009 Much lower costs for people with low incomes Your premium does not count toward your maximum $2.40/$6.00 co-pays or 5% of the price after yearly $4,350 in out-of-pocket spending

5. You do not have to get the drug benefit, but you might have to pay penalty if you enroll later

6. Medicare drug benefit might coordinate with drug coverage you already have

Which drugs will the Medicare drug benefit cover?

Each Medicare drug plan has its own formulary (list of covered drugs) Can change formularies throughout the year

Medicare drug plans must cover at least two drugs under each type of drug class

A few drugs are excluded from Medicare coverage by law Some examples are benzodiazepines, and barbiturates

Drug plans usually provide incentives for you to use generic drugs by offering lower out-of-pocket costs for those drugs (cost tiers)

If a drug is not on the formulary or if you get it from a pharmacy not in the plan's network, you will have to pay the full cost yourself

You can ask your plan to cover the drugs you need You and/or your doctor can request an exception

People with Medicaid

If you had Medicaid, your Medicaid drug coverage ended and Medicare covered your drugs beginning January 1, 2006. You do not have to pay a premium or deductible (if your plan premium does not exceed the subsidy) You will have continuous coverage ( no gap) You may have a small co-pay for each prescription:

At or below 100% FPL (federal poverty level): You pay $1.10 for generic and $3.20 for brand-name Above 100% FPL: You pay $2.40 for generic and $6.00 for

brand-name FPL $10,830 a year for singles and $14,570 a year for couples in 2009

No co-pay after reaching $4,350 in out-of-pocket spending (your co-pays plus Medicare’s extra help)

Beneficiaries who have full Medicaid benefits and reside in an institution will have no co-payments.

People without Medicaid and incomes below 135% FPL

If you do not have Medicaid, your assets are low and your 2009 income is below $14,620 ($19,670 for couples): You will not have to pay a premium or deductible

(if your plan premium does not exceed the subsidy) You will have continuous coverage ( no gap ) You will have a small co-pay for each prescription:

$2.40 for generic and $6 for brand-name No co-pays after reaching $4,350 in out-of-pocket

spending

People without Medicaid and incomes below 150% FPL

If you do not have Medicaid, your assets are low and your 2009 income is below $16,245 ($21,855 for couples) you will pay: Sliding scale monthly premium Up to a $60 yearly deductible Continuous coverage prior to reaching the $4,350

in out-of-pocket spending Coinsurance of 15% up to the out-of-pocket limit

($4,350) Co-payment of $2.40 and $6.00, respectively,

beyond the out-of-pocket limit.

How do you get extra help?

Some people will get extra help automatically

Some will have to apply for extra helpEveryone will have to choose a Medicare

prescription drug plan to get Medicare drug coverage

Who gets extra help automatically?

If you are enrolled in:MedicaidSupplemental Security Income (SSI)Medicare Savings Program (MSP) such as

QI-1, SLMB or QMBYou do not have to apply for extra help—

you get it automatically

If you are enrolled in:Medicaid Supplemental Security Income (SSI)Medicare Savings Program (MSP) such as QI-1, SLMB or QMB

You do not have to apply for extra help—you get it automatically

What happens if you have Medicaid spend-down?

You automatically get extra help the first month you meet your spend-down amount Get extra help for the rest of the calendar year

Once eligible for extra help, treated like everyone with Medicaid

What if you do not automatically get extra help?

You have to fill out an applicationYou can apply through:

Social Security AdministrationPrint applicationOnline application

http://www.ssa.gov/prescriptionhelp/ Medicaid

Does it matter where you apply?

Social Security—generally an easier process You can self-attest to your income and assets You can apply online or mail-in application

No in-person interview But will not check to see if you are eligible for other

assistance programs

Medicaid Will check to see if you are eligible for other programs that

could help you with your health care costs If your assets are higher than limits, but state has no asset test for MSP,

you can get extra help that way May have more liberal income calculations You may need to show proof of income and assets

May require in-person interview

How do you apply through Social Security?

Online application available on http://www.ssa.gov/prescriptionhelp/

Print applications mailed to people with low Social Security income On a monthly basis Must use original print application

No photocopies

At local Social Security office

How should you count your income and assets?

Must include income and assets of spouse unless separated

Earned income: wages, earnings from self-employment

Unearned income: Social Security, Veterans Benefits, pension, etc.

Assets: stocks, bonds, mutual funds, retirement accounts, checking and savings accounts

Certain income and assets will not be counted, so apply even if it looks like you are over the limits

Can you get help completing your application?

Call SSA at 800-772-1213 Talk to a counselor at your local Medicaid office Call your State Health Insurance assistance program

(SHIP) Ask a friend or relative for help

A personal representative can fill out the application for you

What if you are denied assistance?

If you apply through Social Security, request an administrative review from Social Security.Choose a telephone hearing or case review.You can appoint a personal representative.SSA decision can be appealed in federal

court. If you apply through Medicaid, you must

appeal through Medicaid.

How do you get drug coverage if you have Medicaid?

You must enroll in a Medicare private drug plan You will be randomly assigned and enrolled in a

plan if you do not sign up for one Medicare will send you a letter telling you which

plan it is enrolling you in if you do not sign up for one on your own

Medicare determines the prospective effective date

You can change your drug plan once a month

How do you get drug coverage if you have an MSP or SSI?

Enroll in a Medicare private drug plan You will be randomly assigned and enrolled

in a plan if you do not enroll in one Medicare will send you a letter telling you

which plan it is enrolling you in if you do not sign up for one on your own

Medicare determines the prospective effective date

You can change your drug plan once a month

How do you get drug coverage if you applied for extra help?

Once you get notice saying you qualify for extra help you should select and enroll in a Medicare private drug plan.Medicare will determine when your

coverage beginsMedicare will automatically enroll you in

a plan if you do not enroll in one.You can change your drug plan once a

month

There are other programsthat can help

If your state has a prescription drug program, sign up

If your income is low and you do not have Medicaid or help paying your Part B premium through a Medicare Savings Program: Find out if you are eligible for a Medicare Savings

Program If you enroll in an MSP you will not have to apply for

the extra help paying for your Medicare drug costs

Extra help could affect other assistance programs

What you pay for prescription drugs now is deducted from your income to qualify for: Food Stamps Help paying your rent or public housing (such as

Section 8 Housing) Help paying your heat (LIHEAP)

If Medicare pays for your prescription drugs, your income will be higher

If you are in several of these programs, call your local social services department and ask for a counselor who can help you

Timeline: important dates

Mid-MaySocial Security LIS and MSP Outreach

Letter: Informs people who may be eligible for Medicare Savings Programs about MSP and the extra help available for prescription drug plan costs.

Late August

Social Security - Letter to Review Eligibility for Extra Help (SSA Form No. 1026) Informs people selected for review that they should see if they continue to qualify for extra help. Includes an “Income and Resources Summary” sheet.

September CMS Loss of Deemed Status Letter (GREY Letter) Informs people that they no longer automatically qualify for extra help as of January 1.

Early October

CMS Change in Extra Help Co-payment Letter (ORANGE Letter) Informs people that they will continue to automatically qualify for extra help, but their co-payment levels will change as of January 1.

October Plan LIS Rider By October 31, all people who qualify for the LIS will get an LIS rider from their plan telling them how much subsidy they will get in the new year towards their Part D premium, deductible, and copayments.

Late October/ Early November CMS LIS Choosers Letter (TAN Letter) Informs LIS beneficiaries who chose a plan on their own that their plan’s premium is rising above the regional LIS premium subsidy amount, and they will be responsible for paying a portion of their plan’s premium unless they join a new plan.

Late October/Early NovemberCMS Reassignment Letter (BLUE Letter) Informs people that their current plan is leaving the Medicare Program and they will be reassigned to a new plan effective January 1, unless they join a new plan on their own by December 31.

Late October/ Early November CMS Reassignment Letter (BLUE Letter) Informs auto-enrollees that because their plan’s premiums are increasing above the regional LIS premium subsidy amount, they will be reassigned to a new plan effective January 1, unless they join a new plan on their own by December 31.

November Social Security Part B Income-Related Premium Adjustment Notice - Tells higher-income consumers about income-related Part B premium adjustments.

November Social Security LIS Redetermination Decision Letter Begins - Social Security begins mailing decision letters about LIS eligibility for the coming year.

Late November Social Security LIS and MSP Outreach Letter (Form SSA-L441) Informs people who may be eligible for QDWI about the Medicare Savings Programs and the extra help available for Medicare prescription drug plan costs.

Daily - ongoing CMS Deemed Status Letter (Pub No. 11166) (PURPLE Letter beginning in Sept/Oct) Informs people that they will automatically get extra help, including people 1) with Medicare and Medicaid, 2) in Medicare Savings Program, and 3) who receive Supplemental Security Income (SSI) benefits.

Timeline: important dates

November 15 to December 31stAnnual enrollment period for Medicare

drug benefit.

January 1stMedicare drug benefits begin.

Things to remember

Getting extra help is a two-step process:1. Qualify for extra help (automatically or by applying)2. Enroll in a Medicare private drug plan

People with Medicare and Medicaid (including spend-down) started getting their drugs through Medicare January 1, 2006

You can apply for extra help through Social Security or your local Medicaid office Generally, applying through Social Security will be

easier

Any Questions?