HCV Advocate Logo HCV Advocate Logo
Contact Us Site Map Resources en Espanol
For living Positivley. Being Well
About Hepatitis
Hepatitis C
Hepatitis B
Fact Sheets
News Updates
Community & Support
Resource Library
About Hcsp
 
 
Hepatitis C
Back to Living with Hepatitis C

Medicare Part D - The Prescription Drug Plan Additional Help for Low Income Beneficiaries

By Jacques Chambers

(click here to download pdf)

For the first time since its inception in 1965, Medicare is preparing to expand its coverage to include prescription drugs. When Medicare first started, prescription costs made up barely 8% of all the dollars spent on healthcare. As is obvious to anyone dealing with virtually any type of medical problem, prescription medications now take a far larger piece of healthcare dollars today. Medications can run hundreds, even thousands of dollars per month.

As part of the Medicare Modernization Act, signed into law in 2003, voluntary prescription drug coverage will soon become available to all who are or become eligible for Medicare. Private prescription providers and insurance companies are developing plans to offer the coverage. Eligible individuals will be able to choose from several different plans from their prescription carrier.

Some important dates to be aware of:

  • Now – Part D drug coverage is not designed to cover 100% of all prescriptions so additional assi stan ce will be provided to persons with low income. Letters are currently being sent from Social Security to all who may become eligible for additional financial assi stan ce, giving people the chance to apply for the additional assi stan ce.

    • NOTE : Applying for low income assi stan ce is a separate application process from enrolling in Part D itself which doesn’t begin until November 15, 2005 .

  • October 15, 2005 – Medicare will open a website that will provide assi stan ce to beneficiaries in choosing the right prescription plan for their needs.

  • November 15, 2005 – Open enrollment begins when eligible persons may enroll in Part D coverage.

  • January 1, 2006 – Coverage under Medicare - Part D becomes effective.

  • May 15, 2006 – Last day of Open Enrollment for Part D coverage. Late enrollees will have to wait until the first of next year and may incur a 10% surcharge for each year not enrolled.

While the program affects everyone on Medicare, it will have an even greater impact on people covered under both Medicare and Medicaid, since they will now have to get their prescriptions through Medicare instead of Medicaid.

This will be the first of several columns on the Medicare Part D program. This column will deal with the assi stan ce available for people with low incomes; this is being published first because letters to potentially eligible persons are currently being mailed and applications are currently being accepted for the assi stan ce programs.

Future columns will deal with the benefits of the plan for those not eligible for additional financial assi stan ce, and on how to choose the best prescription plan for you.

If you have Medicare and:

  • Nothing else, you should start watching for information on the various plans from which you will be able to choose coverage. Stay connected to learn more about the plans as information is released, in this column, in senior publications such as AARP, at the Social Security (ssa.gov) and Medicare (medicare.gov) websites, etc.

  • Medigap (supplemental Medicare) coverage with drug coverage, expect to receive notice that the drug portion of your Medigap plan will be ending 01-01-06 .

  • Medicaid, you should have gotten or will soon get important information about the additional benefits Part D will provide to low income beneficiaries. Medicaid drug coverage ends 01-01-06 for persons covered under both Medicaid and Medicare.

  • Are Low Income, additional benefits are provided to assist with covering your portion of the charges and the premium. Some details are below and more will be published as they become available.

Overview of Medicare Part D

Private insurance companies and other prescription delivery systems have the ability to offer their own versions of Part D Medicare. Everyone eligible for Part D will have at least two plans to choose from, more in many metropolitan areas. It will be up to you, with some assistance from Medicare and many non-profit organizations, to decide which plan is best for you. Once enrolled, you will only be able to change drug plans once a year.

The premium for the basic coverage is anticipated to average $32.20 per month, although it will be higher for some plans with broader coverage.

The most important item to compare is the formulary that the plan uses. Plans do not have to cover all prescription drugs although they must cover virtually all drugs in six classes of drugs: anti-retroviral, antidepressants, anti-psychotics, anticonvulsants, anticancer agents, and immunosuppressants.

However, not all medications have to be on all formularies, although each plan must cover at least two medications in each therapeutic class of drugs. A preliminary review of the proposed plans being submitted appears to indicate that the various plan administrators are going to list many more medications in their formulary than the required minimum. This is good, because you can only change drug plans once a year, while the drug plans may revise their formulary more frequently. More on picking the right prescription plan will be written in future columns as the date for enrollment gets closer and the various actual plans are introduced.

The Medicare Modernization Act included a basic design for a plan of benefits; however, it also permits Part D providers to vary from that basic plan as long as the benefits available are “actuarially” equivalent to the basic plan in the law, meaning that the benefits paid by the provider will generally be equal to what would be paid under the basic plan. It is doubtful that many providers will offer the basic plan which will be discussed more thoroughly in a future column.

No Supplemental Drug Coverage. For persons not eligible for the low income benefits, the law precludes sales of any supplemental drug coverage that would fill those gaps. Even the Medigap policies with drug coverage will be dropped. Persons covered under their prior employer’s health plan or by individual health coverage will still be able to utilize those benefits; however, it is anticipated that those plans will reduce or drop their drug coverage as time passes. Only the assi stan ce provided to low income beneficiaries, below, can supplement Part D coverage.

Additional Benefits for Low Income Beneficiaries

Recognizing that the coverage under Medicare - Part D plans will still be a financial hardship on persons with low incomes, additional benefits are provided based on a person’s income compared to the Federal Poverty Level and whether or not the person is on Medicaid.

 

If you have Medicare AND Full Medicaid Coverage

100% Federal Poverty Level* Plan

Then Your

And Your
Income Is
And Your
Assets Are
Monthly Premium &
Annual Deductable
And Your
Copay** Is
Below
100% FPL
Below Medicaid Limits *** $0 $1/generic &
$3/brand name
Above
100% FPL
Below Medicaid Limits *** $0 $2/generic &
$5/brand name

*100% 2005 Federal Poverty Level: $ 9,570/year for an individual

$12,830/year for a couple

**No copayment after $5,100 in total annual drug costs.

***$2,000 ($3,000 for a couple) not counting one residence and one vehicle.

 

If you have Medicare AND NOT Full Medicaid

135% Federal Poverty Level* Plan

Then Your

And Your
Income Is
And Your
Assets Are
Monthly Premium &
Annual Deductable
And Your
Copay** Is
Below
135% FPL
Below
$7 500 ($12 000 Couples)
$0
$2/generic &
$5/brand name

*135% 2005 Federal Poverty Level: $12,920/year for an individual

$17,321/year for a couple

**No copayment after $5,100 in total annual drug costs.

 

150% Federal Poverty Level* Plan

Then Your

And Your
Income Is
And Your
Assets Are
Monthly Premium &
Annual Deductable
And Your
Copayt** Is
Below
150% FPL But Above 1135% FPL
Below
$11 500 ($23 000 Couples)
Sliding Scale Monthly Premium & $50/yr Deductible 15% Coinsurance

*150% 2005 Federal Poverty Level: $14,246/year for an individual

$23,000/year for a couple

**After $5,100 in total annual drug costs copay is $2/generic and $5/brand name.

Anyone who believes they may qualify for one of the low income assi stan ce plans should make application for it now. Social Security is accepting applications for the low income plans, even though enrollment in Part D itself won’t start until November 15, 2005 .

If you did not receive an application in the mail, you may obtain one by calling Social Security at 800-772-1213 or you may complete an on-line application at www.socialsecurity.gov. Click on “New Medicare Prescription Drug Plan.”

 


Confused about applying for disability? Click
here

[Jacques Chambers, CLU, and his company, Chambers Benefits Consulting, have over 35 years of experience in health, life and disability insurance and Social Security disability benefits. For the past twelve years, he has been assisting people with their rights, problems, and other issues concerning benefits and disability. He can be reached at jacques@helpwithbenefits.com or through his website at: http://www.helpwithbenefits.com.]



Copyright, (August, 2005) Hepatitis C Support Project / HCV Advocate www.hcvadvocate.org. All Rights Reserved. Reprint is granted and encouraged with credit to the Hepatitis C Support Project


Back to Living with Hepatitis C


About Hepatitis | News Updates | Community & Support | Resource Library | About HCSP | Contact Us | Site Map | Resources en Espaņol | Home

Hepatitis C Support Project
(C) 2005. Hepatitis C Support Project

Medical  Writers' Circle
Fact Sheets