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Medicare's new drug plan starts Wednesday

BY EMILY HAGEDORN, Californian staff writer
e-mail: ehagedorn@bakersfield.com | Saturday, Nov 11 2006 9:10 PM

Last Updated: Saturday, Nov 11 2006 9:27 PM

Get out your Medicare card, your prescriptions and your calculator -- again.

Open enrollment for Medicare prescription "Part D" drug plans is three days away.

"Throw a dart. Say a prayer. There's nothing that's guaranteed with these plans," said Deane Beebe, spokeswoman for the East Coast-based Medicare Rights Center, a counseling and advocacy organization. "No one is spared the exercise of going back and determining if their current plan or another source entirely would better meet their needs."

Starting Wednesday, eligible people -- those already enrolled in Medicare's other programs and over 65 or disabled -- can sign up for a new prescription drug plan, known as Part D, or switch plans if they already had one. The enrollment period ends Dec. 31, and they won't have another chance to change plans until November 2007.

If you're happy with your plan, you shouldn't have to do anything, but the Centers for Medicare and Medicaid Services are suggesting you "check up" on your plan, said H. Stephen Deering, CMS deputy regional administrator.

While the average monthly premium for standalone Part D plans in California will rise by about $4 to $27.60 next year, 88 percent of beneficiaries in California will have access to cheaper coverage than this year, said Jack Cheevers, California spokesman for CMS.

Some plans have changed; others have pulled out, Deering said. For example, four of the 10 programs for Medi-Cal and Medicare recipients won't be available next year.

Many other insurance companies have branched out into prescription drug plans. This year, 55 standalone prescription drug plans are available for Kern County residents, up from 47 last year.

"If you don't need the plan today at 65, you might need it later," Deering said. "You're buying an insurance plan. You buy fire insurance when your house hasn't yet burned down, right?"

Next year

People with a basic Part D plan may have to pay more next year.

Here's how it works:

* You pay 100 percent up to the $265 deductible, which is up from $250 this year.

* When your drug costs go from $265 to $2,400 ($2,250 in 2006), you then pay 25 percent -- up to $533.75.

* Beyond $2,400, you are in the "doughnut hole." Your coverage stops until the total cost of your medicine reaches $5,451.25 and you've paid $3,850 out of pocket (up from $3,600 this year). While you're in the hole, you pay 100 percent of your prescription bills.

* Beyond the $3,850, Medicare picks up 95 percent of your tab.

Falling into this hole can be especially aggravating, considering you must continue paying monthly premiums, said Yolanda Prado, program manager for Kern County's Health Insurance Counseling and Advocacy Program. Unless you also have Medi-Cal, you can't switch or drop a plan mid-year.

"We're finding folks who are very happy to have the discounts," she said. "But then they reach the doughnut hole, and they're back to square one."

This basic structure is only the floor, Cheevers said. Thirty-three standalone plans have no deductibles; 14 have gap coverage.

For example, WellCare Classic has the cheapest premium at $9.70 a month but no gap coverage. SierraRx Plus is the second-most expensive at $74.80 a month but has no deductible and covers all formulary drugs in the gap.

If you're eligible and don't enroll, you could face penalties.

If you become eligible mid-year -- which would happen if you turn 65, get dropped by other insurance or were deemed eligible due to a disability -- you have seven months to enroll. If you have a private plan that offers drug coverage, such as through an employer, you can put off getting Part D, Prado said.

Some extra help

If you are low income, you may be eligible for "extra help."

To qualify, for example, a single person must make less than $14,700 a year and have less than $11,500 in assets.

This is especially helpful to someone who takes enough medicine to put them into the coverage gap, Prado said.

Depending on your income, premiums and deductibles are stripped away under the subsidy, and you can get your drugs for $1-$2.15 for generic and $3.10-$5.35 for brand names, Cheevers said. These prices have increased a few cents from this year. Beyond the gap, most people with the subsidy pay nothing.

The U.S. Department of Health and Human Services estimates about 25 percent of extra-help eligible people haven't signed up.

"People who are not sure if they are 'low income' should try applying for the low-income subsidy anyway," said Randolph T. Boyle, staff attorney with the National Health Law Program in Los Angeles. This is done through the Social Security Administration. "It doesn't cost a thing to apply."

Part D's first go-around

After reaching the doughnut hole sometime in June or July, Arthur Miller, 56, traveled to Mexico to buy cheaper drugs, he said.

The Bakersfield resident suffers from Parkinson's disease, asthma, neuropathy in his legs and is undergoing spinal implants for a degenerative neck stem condition, he said. He takes about 17 prescriptions, some of which cost a few hundred dollars.

Since falling into the coverage gap, he has stopped taking five or six of his most expensive medicines, which has made his Parkinson's tremors increase, he said.

"I get sick of hearing people gripe about paying $6 for a prescription," he said. "And I don't have a problem confronting people about it."

Miller is among the minority of people who reached the gap.

Depending on the source, between 3 million and 7 million people fell into the doughnut hole, with most estimates, including Medicare's, toward the lower end. These people represent about 9 to 21 percent of the 32.8 million people with a Part D plan.

Overall, about 82 percent of the 85,081 eligible people in Kern County signed up for drug coverage as of mid-June, CMS reports.

Greater Bakersfield Legal Assistance brought on staff attorney Doug Klinchuch to handle any legal issues brought on by Part D.

"We weren't sure what the litigation was going to be like, but we thought there would be more," he said.

Many people say this enrollment will be similar to the first, though what exactly that means depends on the source.

"They may have a rude awakening," Beebe said. The plans can change their policies mid-year, which means you're "at the whim frankly of the plan if something is going to be covered."

"Folks still have a confusion factor," Prado said. But the fact her organization was able to help people through Part D's launch encourages her.

"We know of the tidal wave we got through last time," she said.

Deering is impressed with how well it's gone so far. More than eight in 10 seniors who are enrolled in a Medicare drug plan are satisfied with it and about half are saving money, according to a Kaiser Family Foundation poll released in late July.

The Medicare-run call centers -- which caused headaches during the last enrollment period due to long wait times and misinformation -- are fully staffed and trained on Part D for the upcoming enrollment, Deering said.

"People are no longer facing the decision of taking their medicine or eating a hot meal," he said. "We're almost to the point where we can say Part D is running how it's supposed to."

Tips for a smooth enrollment

• If you like your plan, double-check that it’s not going to change next year by calling your plan or Medicare.

• If you had the low-income subsidy, known as “extra help,” this year, make sure you’re still eligible for next year by contacting the Social Security Administration, said Kevin Prindiville, project attorney for the National Senior Citizens Law Center in Oakland. This is especially important if your income has gone up.

• If you are signing up for the first time, make sure you’re not already covered. People with comparable coverage, such as from an employer or HMO, won’t be penalized for not signing up for prescription drug coverage.

If you accidentally do sign up for Part D, you could get kicked off your regular health plan, said Yolanda Prado, program manager for Kern County’s Health Insurance Counseling and Advocacy Program.

If you already have a comparable alternative, make sure you have a letter from your insurance company saying so, Prado said. It can protect you against paying penalties if your plan dumps you later.

• If you do need coverage or want a new plan, start the search by shrinking the amount of plans down to a manageable number.

Going to www.medicare.gov or calling 1-800-MEDICARE (633-4227) can decrease your list to three, based on your medications, price range and pharmacy.

You can also contact Kern County’s Health Insurance Counseling and Advocacy Program, which is through the state Department of Aging and Adult Services. This agency has a worksheet you can use to collect all the information you’ll need to compare plans: prescriptions, Medicare number, etc., Prado said. This office can also counsel you on the different plan options.

• Considering that each plan has different formularies — the list of medicines they cover — contact the insurance companies directly to make sure they will cover your medicines, said Deane Beebe, spokeswoman for the East Coast-based Medicare Rights Center.

“If your plan doesn’t provide written notice that it will cover your drugs, assume that it won’t,” she said.

Restrictions can include prior authorization from your doctor, quantity limits and step therapy, in which you have to try the cheaper generic drugs first before you can get the brand names. On Medicare’s revamped Web site, you can see the specific restrictions a drug carries.

Also, if your doctor is considering putting you on a different drug regimen, make sure your plan covers those drugs as well. • Look at your finances and determine what you can spend over the coming year. Take into account any changes to your income since you last signed up.

Also, you might want to compare the price of your current plan to other plans, considering many new plans have jumped on the Part D bandwagon since May, Prado said.

• You should also be cognizant of the pharmacies approved for your plan. Sometimes the pharmacy you’ve gone to for the last 30 years isn’t approved, Prado said.

• Clue your doctor in on your choices. Ask your physician if there are any drugs you should stop taking and any generic versions you can switch to.

• To ensure that your plan will cover you on Jan. 1, sign up or switch plans by Dec. 8, said H. Stephen Deering, deputy regional administrator for the Centers for Medicare and Medicaid Services.

• Don’t be afraid to ask questions, Prado said.

Many older Americans, who lived through World War II and the Depression, know about living with inconveniences, but they shouldn’t settle, she said. “Don’t give up until you get your answer.”

Fast facts

Nov. 15-Dec. 31 — Open enrollment for prescription drug plans.

Dec. 8 — The date the Centers for Medicare and Medicaid Services suggests that you have your paperwork in if you want to start using the benefits on Jan. 1.

Beneficiary — Someone who is enrolled in an insurance plan.

Deductible — The amount someone has to pay out-of-pocket before the insurance starts to pay.

Doughnut hole — The coverage gap in basic Medicare Part D coverage.

Formulary — A list of drugs that the insurance company will pay for.

Part D — The part of Medicare in which private insurance plans provide outpatient prescription drug coverage.

Premium — A monthly amount a beneficiary pays to an insurance plan for prescription drug coverage.

For more

Medicare: 1-800-MEDICARE (633-4227) and www.medicare.gov

Social Security Administration: 800-772-1213 and www.ssa.gov

California Department of Managed Health Care: 888-HMO-2219 (466-2219) and www.dmhc.ca.gov

Kern County’s Health Insurance Counseling and Advocacy Program: 868-1000 and www.co.kern.ca.us/aas/hicap.asp

Greater Bakersfield Legal Assistance’s Health Consumer Center: 321-3982 and www.gbla.org

Check out The Pulse, reporter Emily Hagedorn’s blog on health and medicine. You can find it at people.bakersfield.com/blogs/ ehagedorn.