Posted: 12/13/05
New Medicare prescription drug program starts in three weeks
By David Heiller
Argus News Editor
Come up with a standard plan.
Itís too complicated.
Itís insurance fraud.
ì!@#$%^&*!!!î
If you talk to senior citizens about the new federal prescription drug program, those are the sentiments you will hear over and over.
The program, called Medicare Part D, goes into effect on January 1, although people can sign up without being penalized until May 15.
Lester Wiegrefe of Caledonia said a standard plan from all insurance companies would be much better than the current situation. His company alone had three different plans, each of them covering different drugs.
ìAnd [make it] so all the drugs were covered equally,î Laverne Massman added. They shared their opinions after eating at the Caledonia Senior Dining Center on December 7.
Massman said he and his wife, Julia, didnít sign up for the plan yet, but may do so down the road. One issue that the Massmans have is that Juliaís medication, Prevadic, isnít covered by their plan.
But even if it were, Julia would likely not sign up. Hereís why: Julia can buy her prescription from Canada for $70 a month, and from Mexico for just $7 a month. If she went with Medicare D, the prescription would come from the United States at a cost of $138 a month. Plus her medicare supplement policy would cost an extra $14 a month.
ìItís not about seniors, itís about the drug companies,î Julia Massman said of the new plan.
Senior citizens will be paying for the program by increased costs of Medicare supplements, Julia feels. She thinks Congress needs to go back to the drawing boards on it all. She thinks a much more simplified plan is possible, and calls the present plan a fraud.
The program will work for seniors who use expensive medication, Julia said. That seems to be the case for Lester Wiegrefe. He estimates that he will save $1,800 annually with Medicare D.
Some common
misconceptions
Barb Jilk, caregiver advocate at Semcac in Rushford, said the most common question that people ask about Medicare D is whether they are eligible. ìThey think that people with certain incomes might not be eligible,î she said. ìEvery person who is on Medicare is eligible. . . . I think the biggest misconception is that [they think] nobody benefits because so and so didnít benefit.î
People with low incomes and assets will qualify for special help in paying for Medicare D premiums and other items, Jilk said.
The application process is extremely difficult to understand, Jilk feels. She has helped explain the program at places like Caledonia Senior Dining, where more than 100 people heard her and a worker from the Social Security Administration discuss the plan.
She also wanted to remind people that the program is voluntary, and nobody has to sign up for it.
ìAll people on Medicare should look into it, because they have to make a decision,î Jilk added ìIn many cases if they have current coverage through a Medicare supplement for drugs, sometimes those policies will not longer be in force. They are being given up by companies.î
Those plans are subsidized by Medicare and have to meet certain requirements, Jilk said. ìPlans can vary but they have to be the actuarial equivalent of the plan recommended by Medicare, Jilk said.
Medicare D has generated a lot of competition between insurance agencies, Jilk said. She said there are scores of plans in each district.
Wait and see approach
Rick Sime, a pharmacist who owns Caledonia Drugs, said he has received a lot of questions from customers about Medicare Part D. ìEverybody is thoroughly confused,î he said.
He urged people to take a cautious approach, since the cutoff is May 15, 2006. ìThe thing they need to remember is they donít have to do anything,î Sime said. ìThey can sit back and look at it and see whatís working and what isnít.î
The penalty for signing up after May 15 is just 1 percent of the premium, which isnít much, Sime feels. ìEven if they waited five years, the penalty wouldnít be any big deal,î he said.
Sime also suggested that people check out some of the inexpensive plans, which can start as low as $1.87 per month.
Medicare is afraid that only people who need medications will sign up and therefore the program wonít get premiums to offset drug costs, Sime feels.
If doctors prescribe brand name for the people who will be covered, it will drive up cost to administer the new program. ìItís the doctors they need to be chatting with,î Sime said.
So why donít doctors prescribe more generic drugs? Pharmaceutical company sales people tell doctors how great the drugs are and they try it, Sime responded. ìThatís just the nature of the business.î
Doctors prescribing generic drugs would drive down costs of medical assistance too, he said.
See your insurance agent
Tom Danielson, who owns Danielson Insurance in Caledonia, said the best advice he could give seniors would be to talk to their agent and break down the information that they have. Things will fall into place for them then, Danielson said.
His biggest concern is that people have been bombarded with information. ìTheyíre just swimming with all this information, just trying to find a common thread in all of it.î
Another concern for him is that people donít know what kind of changes the government will make in the future to tweak the system.
Danielson is also worried that insurance companies are getting a lot of paper mailed to their offices now. He had a pile of it on his desk when talking with this reporter on December 7. Insurance companies have to take all that information from agents and clients and put in a system thatís spread to all drug stores. When people walk in with their insurance cards, everything will have to be up to date, such as what kind of coverage theyíve got and how it will pay for their drugs, their deductible, and their co-pay. That might be a problem, Danielson said.
Yet his optimism seems to outweigh his concerns.ìWe think that a lot of the people will be possibly better protected with the direct drug coverage with this program,î Danielson said.
If people make a decision for 2006 and arenít comfortable with it, or if their needs change, they can make a change in drug coverage in 2007, Danielson added. ìTheyíll have an annual open enrollment period every November 15 through December 31,î he said. ìThatís kind of a failsafe situation.î
Danielson feels that it would be in the best interest of people with no drug coverage now to sign up for a minimum plan to protect from paying a penalty later on.
How it works
Here is some general advice for people about Medicare Park D:
The premium refers to the monthly amount you pay to join a Medicare Part D drug plan. The cheapest one has a $1.87 per-month premium and the most expensive one is $99 per month, with an average cost of about $32. People qualifying in certain low- income categories may not have to pay a premium.
The deductible, most likely $250 a year, is the amount you pay before the plan starts to share the drug costs.
There is then a co-payment of $500 (or 25 percent) out of the next $2,000 of drug costs. Then you pay for all drug costs between $2,250 and $5,100 per year, which is $2,850.
You would pay about 5 percent of all remaining drug costs in the year once you have spent $3,600. Your plan pays 95 percent of this ìcatastrophicî level of coverage.
One task for enrolling is to list all the prescription drugs you take. Then study the different plans to see if they cover your particular drugs. Look to see what premiums and any deductibles you would have to pay.
The list of drugs that a Medicare drug plan covers is called a formulary and they can be either generic or brand name drugs. The formulary must include at least two drugs in categories and classes of the most commonly prescribed drugs to people in Medicare.
Another step is to see if the pharmacy near you or the one you would like to use participates in the plan you are considering. Some plans may offer a mail-order program to have the drugs sent to you.
Some plans may require prior authorization. That means your doctor must tell the plan provider that it is medically necessary for you to take that drug, so that it can be covered.
The new program is different than the Medicare-approved drug discount cards. The cards phase out by May 15 2006, or when your enrollment in a Medicare prescription drug plan takes effect, if earlier.
Medicare D information and sign-up dates
Here is some sign-up deadline information Medicare D, as well as sources for more information.
If someone wants to take advantage of the program at the earliest possible time (Jan. 1, 2006), they must enroll by the end of this year. The signup period began Nov. 15.
You can still sign up by May 15, 2006, and then start using the program. However, you will have a penalty if you sign up after next May 15, the penalty increasing by one percent for every month between next May 15 and when you sign up. The government refers to it as a surcharge and it is in addition to the premium that you would pay each month that is required in the particular drug program option you choose.
If you have a credible drug assistance program at the time of the enrollment period and decided to sign up past May 15, 2006, you would not get a surcharge or penalty.
The enrollment period each year after the May 15, deadline has passed will be Nov. 15 -Dec. 31.
You can change the Medicare Part D drug plan during each Nov. 15-Dec. 31 enrollment period.
ï More information: One of the best sources of information on Medicare Part D is the Minnesota Linkage Line/RX Connect at 1-800-333-2433. Another resource is 1-800-Medicare (1-800-633-4227). People can also log onto www.MyMedicareMatters.org. You can also get a copy of the program by logging onto www.mnseniors.org or call 1-877-645-0261.
Semcac caregiver advocate Barb Jilk is also a good resource. She has a client information sheet that people can fill out that will help determine how much a person will benefit from Medicare Part D. People can schedule a home visit with Jilk to go over the sheet. Call her at 507-864-7741.
Julia Massman of Caledonia listed the following website as very helpful: www.arp.com/bulletin.
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