Medicare Prescription Drug Coverage Retiree Town Hall Presentation: Comparing Prescription Drug Cove

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Medicare Prescription Drug CoverageRetiree Town
Hall PresentationComparing Prescription Drug
Coverage

• November 2005

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Todays Agenda

• Whats happening?
• Why were here today
• Considerations as you evaluate coverage
• Comparing your Oak Ridge retiree prescription
  drug coverage to local provider plans
• Considerations for limited income and resources
  individuals
• What happens next?

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• Whats Happening?

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Whats Happening?

• Medicare Prescription Drug, Improvement, and
  Modernization Act of 2003 or the Medicare
  Modernization Act (MMA) signed into law on
  December 8, 2003
• Effective January 1, 2006, Medicare will provide
  optional prescription drug coverage called
  Medicare Part D
• It replaces prescription drug discount card,
  which will phase out by May 15, 2006
• Beginning November 15, anyone with Medicare is
  eligible to enroll for this coverage
• Legislation encourages employers to continue to
  be the primary provider of prescription drug
  benefits for their Medicare-eligible population

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Whats Happening? (cont.)

• The benefits of this legislation include
• Offers prescription drug coverage to Medicare
  beneficiaries who dont have access to adequate
  prescription drug coverage today
• Provides enhanced benefits with lower
  out-of-pocket costs to limited-income
  beneficiaries, as defined by the government
• Gives employers the choice to continue to be the
  primary provider of prescription drug benefits ?
  not intended to replace employer-sponsored
  coverage thats as generous or more generous

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Whats Happening? (cont.)

• Oak Ridge will continue to offer the current
  prescription drug coverage, which is as generous
  as or more generous than Medicare Part D for 2006
  
• Anyone who participates in an Oak Ridge retiree
  medical plan receives prescription drug coverage
  automatically
• Oak Ridge prescription drug coverage does not
  coordinate with Medicare Part D coverage
• This means, for most Medicare-eligible Oak Ridge
  employees and retirees, enrolling in Medicare
  Part D will not provide additional benefits
• If you are a Medicare-eligible retiree or LTD
  recipient enrolled in Oak Ridge coverage and you
  elect Medicare drug coverage, your Oak Ridge
  medical and prescription drug coverage will be
  cancelled

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Why Were Here Today

• By now, you may have received mailings from a
  number of carriers who want to offer you
  prescription drug coverage
• These mailings will encourage you to enroll just
  to be safe
• The companies sending you these mailings do not
  know that you already have prescription drug
  coverage through Oak Ridge
• They are mailing to all Medicare-eligible
  individuals
• Oak Ridge wants you to understand
• What Medicare drug coverage means to you as a
  Medicare-eligible Oak Ridge retiree or employee
• That your current prescription drug coverage is
  as generous as or more generous than the standard
  Medicare coverage
• Enrolling in Medicare Part D will not offer any
  additional benefits, although there are some
  exceptions
• Enrolling in private Medicare prescription drug
  coverage for 2006 will jeopardize your Oak
  Ridge-provided coverage

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• Considerations As You Evaluate Coverage

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Medicare Part D Terminology

• Terms and abbreviations
• CMS Centers for Medicare and Medicaid Services
• Medicare Part D also refers to Medicare
  prescription drug coverage
• As generous as or more generous than the
  Medicare phrase applied to employer-provided
  coverage that offers a benefit comparable to (or
  better than) the standard Medicare Part D
  coverage
• Creditable Coverage verification that an
  individual has coverage that is as generous as or
  more generous than standard Medicare Part D
  coverage
• Formulary a specific list of drugs that are
  considered covered by a health plan or
  prescription drug plan
• Limited Income and Resources individuals who
  meet specific criteria established by CMS that
  qualify them for extra assistance through CMS
• TrOOP True out-of-pocket maximum that is
  defined as the amount of out-of-pocket costs a
  retiree would expect to pay if enrolled in a
  Medicare Part D plan, not including monthly
  premiums or out-of-pocket costs for catastrophic
  coverage

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Considering Other Prescription Drug Coverage

• As mentioned, choosing Medicare prescription drug
  coverage will jeopardize your Oak Ridge retiree
  medical coverage
• However, we understand that you will receive
  mailings from many providers offering coverage
  and you may want to compare those plans with your
  Oak Ridge retiree medical coverage
• To help you, well be comparing some of the plans
  offered in our area during todays session
• In evaluating coverage, well be asking these
  questions
• Does the plan cover all my drugs?
• How much will this plan cost me?
• Does the plan have a coverage gap?
• How does the plan limit my out-of-pocket
  expenses?
• Is my pharmacy in the network?
• Does the plan offer mail order?

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Does The Plan Cover All Of My Drugs?

• Many plans have formularies, which limit the
  drugs that are covered under the plan
• All of the Medicare prescription drug plans
  include a formulary
• In most cases, these formularies limit the number
  of drugs offered under each class of drugs and
  may cover a generic rather than brand-name drug
• We will not cover specific formularies for each
  of the plans today
• Contact each provider if youd like more
  information about their formulary
• Your Oak Ridge prescription drug coverage does
  not include a formulary

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How Much Will This Plan Cost Me?

• The first consideration will be the premium or
  contribution for joining the plan
• The national average cost of Medicare
  prescription drug plans is 32 per month, but
  prices will vary, depending on the level of
  coverage provided in each plan increased
  coverage will generally cost more
• The next consideration is the deductible that
  must be met before coverage will begin
• Most plans require that you pay the full cost up
  to a certain dollar limit, after which the plans
  benefits begin
• The standard Medicare prescription drug plan
  includes a 250 annual deductible
• Your Oak Ridge prescription drug coverage
  requires a 150 deductible for retail pharmacy
  prescriptions

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How Much Will This Plan Cost Me? (continued)

• Finally, consider what you may pay, in
  coinsurance or copays, each time you obtain a
  prescription
• Coinsurance is a percentage of the cost
• The standard Medicare prescription drug plan
  includes 25 coinsurance on total annual drug
  costs up to 2,250 and 5 of the cost after you
  have spent 3,600 out-of-pocket
• Your Oak Ridge prescription drug coverage
  includes coinsurance for prescription drugs
  obtained through a retail pharmacy
• Copays are a fixed dollar amount
• For example, generic drug copays through a mail
  order program may cost 25 for a 90-day supply
• Your Oak Ridge prescription drug coverage
  includes copays for prescription drugs obtained
  through mail order

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Does The Plan Have A Coverage Gap?

• A coverage gap or doughnut hole is like a
  second deductible
• When your total prescription drug costs reach a
  certain level, you assume the full cost of
  prescription drugs
• You pay for prescription drugs up to another
  limit of out-of-pocket expenses, upon which the
  coverage gap closes
• The standard Medicare prescription drug coverage
  plan has a coverage gap that takes effect when
  your total prescription drug expenses reach
  2,250
• The standard Medicare plan resumes paying
  benefits when you reach a total of 3,600 in out
  of pocket expenses
• Your Oak Ridge prescription drug coverage does
  not have a coverage gap

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How Does The Plan Limit My Out-of-Pocket Expenses?

• A plan may include an out-of-pocket maximum that
  will limit the amount you pay in coinsurance
  toward prescription drugs in a given year
• The standard Medicare prescription drug coverage
  has an out-of-pocket maximum of 3,600 each year,
  after which Medicare catastrophic coverage begins
• When you reach that threshold, your coinsurance
  is reduced from 25 to 5 for prescription drugs
  for the remainder of that calendar year
• Your Oak Ridge prescription drug coverage does
  not have an out-of-pocket maximum

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Is My Pharmacy In The Network?

• Participating pharmacies vary by plan
• You will need to refer to the materials you
  receive from the insurers offering Medicare
  prescription drug plans in your area
• You should also confirm participation with your
  local or preferred pharmacy

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Does The Plan Offer Mail Order?

• Mail order availability will vary by plan as well
• Confirm that mail order is an option and verify
  how you can submit prescriptions as well as how
  prescriptions are mailed to you
• In some cases, plans allow you to purchase up to
  a 90-day supply of your medication through a
  participating retail pharmacy in addition to mail
  order

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Lets stop for a minute to see if there are any
questions?
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• Comparing Your Oak Ridge Retiree Prescription
  Drug Coverage to Local Provider Plans

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2006 Prescription Drug Coverage for Oak Ridge
Retirees Snapshot of Benefits under the Retiree
Medical Plan
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Standard Medicare Part D Drug Benefit A Visual
Retiree out-of-pocket costs
250
3,600
750
100
Retiree pays 5 (no maximum)
Retiree pays 100 of first 250
Retiree pays 25 of next 2,000, up to 500
Retiree pays 100 of next 2,850, up to
3,600total out-of-pocket limit
Plan pays 95
75
Plan pays 75
Coinsurance
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Coverage Gap (Donut Hole)
CatastrophicBenefit
Coinsurance
Deductible
25
0
250
2,250
5,100
Annual drug costs
Part D benefits
Retiree liability (counts toward 3,600 true
out-of-pocket maximum (TrOOP)
TrOOP is true out-of-pocket maximum amount
retiree must pay before catastrophic (95)
benefit begins. Employer and insurance company
payments do not count toward satisfaction of
TrOOP.
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Comparing Medicare Prescription Drug Plans

• Well be comparing the following plans
• Aetna Medicare Rx Essentials, Plus and Premium
  Plans
• Community Care Rx Basic, Choice and Gold Plans
• Coventry AdvantraRx Value, Premier and Premier
  Plus Plans
• Humana PDP Standard, Enhanced and Complete Plans
• AARP Medicare Rx by UnitedHealthcare
• Please note that we have used each of the plans
  summary of benefits to create this comparison
• We cannot answer specific details about any of
  the plans, with the exception of your Oak Ridge
  coverage
• These comparisons were created using information
  that we believe to be current and accurate
  however, you should contact each of the providers
  directly for the most up-to-date information on
  any of the plans discussed during todays session

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Comparing Oak Ridge Coverage to Aetna Medicare
Prescription Drug Plans
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Comparing Oak Ridge Coverage to Aetna Medicare
Prescription Drug Plans
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Comparing Oak Ridge Coverage to Aetna Medicare
Prescription Drug Plans
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Comparing Oak Ridge Coverage to Community Care Rx
Basic Prescription Drug Plan
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Comparing Oak Ridge Coverage to Community Care Rx
Basic Prescription Drug Plan
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Comparing Oak Ridge Coverage to Community Care Rx
Basic Prescription Drug Plan
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Comparing Oak Ridge Coverage to Coventry
AdvantraRx Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Coventry
AdvantraRx Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Coventry
AdvantraRx Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Humana
Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Humana
Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Humana
Prescription Drug Coverage
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Comparing Oak Ridge Coverage to AARP Medicare Rx
Prescription Drug Coverage
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Comparing Oak Ridge Coverage to AARP Medicare Rx
Prescription Drug Coverage
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Comparing Oak Ridge Coverage to AARP Medicare Rx
Prescription Drug Coverage
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An Example Comparing Oak Ridge Coverage to
Humana Prescription Drug Coverage

• Lets review an example of how the costs might
  play out for a retiree.
• Joe has a few medical conditions that require
  regular medication
• 3 of them are brand-name
• Joe fills these three times at his pharmacy and
  then uses mail order for the rest of the year
  (three 90-day supplies) Each of these drugs
  costs 100 for a 30-day supply or 300 for a
  90-day supply
• 2 of those are on Humanas Preferred Brand name
  list.
• He also takes one drug that is a generic but does
  not take this regularly he expects to refill
  that drug five times during the year at his
  pharmacy. The retail cost for this drug is 30
  for a 30-day supply.
• Well assume that Joe only uses participating
  pharmacies.
• If Joe did not have any coverage, his total
  prescription drug costs would be 3,750.

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An Example Comparing Oak Ridge Coverage to
Humana Prescription Drug Coverage
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An Example Comparing Oak Ridge Coverage to
Humana Prescription Drug Coverage
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Lets stop for a minute to see if there are any
questions?
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Medicare Part C

• Originally known as MedicareChoice plans, now
  called Medicare Advantage or Medicare Health
  plans
• These plans deliver Medicare benefits through
  coordinated care plans (HMOs, PPOs) or private
  fee-for-service plans
• May include additional benefits such as dental,
  vision, hearing screenings and prescription drugs
• Must live in the geographic service area where
  the plan provides service
• Premiums vary by plan
• Available to
• Individuals entitled to Part A and enrolled in
  Part B
• 65 and older
• Disabled Medicare beneficiaries
• Except new enrollees with ESRD
• Well discuss the Medicare prescription drug
  coverage offered by some of the local Medicare
  Advantage plans
• The premium we note for each is for the
  prescription drug coverage only however, many
  of these plans require additional premiums for
  medical coverage

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Comparing Medicare Advantage Prescription Drug
Coverage

• There are several providers who offer Medicare
  Advantage plans in the Oak Ridge area
• These plans include Medicare prescription drug
  coverage as part of their overall medical
  coverage
• Well be comparing prescription drug coverage for
  the following Medicare Advantage plans
• BlueCross BlueShield of Tennessees
  BlueAdvantagePlus
• Cariten Senior Health
• John Deere SecurePlus

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Comparing Oak Ridge Coverage to BCBS of
Tennessees BlueAdvantagePlus Prescription Drug
Coverage
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Comparing Oak Ridge Coverage to BCBS of
Tennessees BlueAdvantagePlus Prescription Drug
Coverage
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Comparing Oak Ridge Coverage to BCBS of
Tennessees BlueAdvantagePlus Prescription Drug
Coverage
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Comparing Oak Ridge Coverage to Cariten Senior
Health Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Cariten Senior
Health Prescription Drug Coverage
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Comparing Oak Ridge Coverage to Cariten Senior
Health Prescription Drug Coverage
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Comparing Oak Ridge Coverage to John Deeres
SecurePlus Prescription Drug Coverage
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Comparing Oak Ridge Coverage to John Deeres
SecurePlus Prescription Drug Coverage
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Comparing Oak Ridge Coverage to John Deeres
SecurePlus Prescription Drug Coverage
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An Example Comparing Oak Ridge Coverage to
Cariten Senior Health Prescription Drug Coverage
Prescription Drug Coverage

• Lets review an example of how the costs might
  play out for a retiree.
• Joe has a few medical conditions that require
  regular medication
• 3 of them are brand-name
• Joe fills these three times at his pharmacy and
  then uses mail order for the rest of the year
  (three 90-day supplies) Each of these drugs
  costs 100 for a 30-day supply or 300 for a
  90-day supply
• 2 of those are on Caritens Preferred Brand name
  list.
• He also takes one drug that is a generic but does
  not take this regularly he expects to refill
  that drug five times during the year at his
  pharmacy. The retail cost for this drug is 30
  for a 30-day supply.
• Well assume that Joe only uses participating
  pharmacies.
• If Joe did not have any coverage, his total
  prescription drug costs would be 3,750.

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An Example Comparing Oak Ridge Coverage to
Cariten Senior Health Prescription Drug Coverage
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An Example Comparing Oak Ridge Coverage to
Cariten Senior Health Prescription Drug Coverage
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Lets stop for a minute to see if there are any
questions?
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• Special Considerations for Limited Income and
  Resources Individuals

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Who Should Enroll in a Medicare Prescription Drug
Plan?
Medicare prescription drug plans are designed for
people who need them most

• Those who qualify for extra help
• The Social Security Administration has identified
  people who may qualify for assistance in paying
  for drugs based on their income and assets ?
  applications were mailed directly to people in
  May 2005

• Those without drug coverage
• For people without the benefit of
  employer-sponsored coverage

but its completely up to each individual to
decide what prescription drug coverage option
makes the best financial sense for his or her
family.
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Whos Eligible for Extra Help?

• Limited income and resources defined as
• Income less than 150 of federal poverty level
• 14,355 for individuals in 2006
• 19,245 for couples in 2006
• Limited liquid assets
• 11,500 for individuals
• 23,000 for couples in 2006
• The Social Security Administration is sending
  applications to those who may qualify for the
  extra benefit
• If you receive an application, you should
  complete it. Submitting this application does
  not enroll you for Medicare drug coverage
• However, according to the Medicare and You 2006
  Handbook, if you apply and qualify for
  assistance, you will automatically be enrolled in
  the plan for which you are considered eligible

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What Does Extra Help Cover?
Income must be less than 9,570 for
individuals/12,830 for a couple. Must also be
eligible for Medicaid. Income must be less
than 12,920 for individuals/17,321 for a
couple. Liquid assets couple Income must be less than 14,355 for
individuals/19,245 for a couple. Liquid assets
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What Does Extra Help Cover?
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But Keep in Mind

• If you become enrolled in a plan offered to
  individuals with limited income and resources,
  you will lose your Oak Ridge retiree medical
  coverage
• Medicare or, if you are eligible, Medicaid will
  be your sole source of medical coverage
• Weigh the potential out-of-pocket costs both
  your medical and prescription drug coverage
  before filing your application
• For example, consider your Medicare inpatient
  deductible if you anticipate being hospitalized
  in the coming year
• You may also want to discuss this with your local
  Social Security office

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• Whats Happens Next?

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Whats Next?

• For 2006, a special Medicare Part D enrollment
  period will be held
• For individuals eligible by November 15 November
  15, 2005 May 15, 2006
• Individuals eligible later If an individual
  becomes eligible for Medicare after May 15, 2006,
  there will be an initial open enrollment period
  for both Parts B D
• In later years, from November 15 to December 31
  for next benefit year (January 1 December 31)

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The Key Question
If I already have coverage through Oak Ridge,
does it makes sense for me to enroll in a private
Medicare prescription drug plan in 2006?
The answer
In most cases, no! Remember the reason ? Oak
Ridge already provides drug coverage that is
expected to pay out at least as much as and in
most cases more than a standard Medicare
prescription drug plan

• Most retirees are better off under Oak Ridges
  plan, unless
• You are eligible for extra help or on Tricare
  (the plan for military retirees and spouses),
• Remember, if you are Medicare-eligible and elect
  Medicare Part D coverage, your continued coverage
  through Oak Ridge will be dropped

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Oak Ridge Retiree Prescription Drug Coverage
Overview

• Your Oak Ridge retiree medical plan includes
  prescription drug coverage
• Anyone enrolled in the Oak Ridge retiree medical
  plan receives prescription drug coverage
  automatically
• Medical and prescription drug coverage is
  integrated you cannot enroll in one without the
  other
• Oak Ridge prescription drug coverage is
  creditable coverage, which is defined by CMS as
  being on average at least as generous as the
  standard benefit
• Protects your right to leave the Oak Ridge
  retiree medical plan and join another certified
  plan or Medicare prescription drug plan within 63
  days without incurring a penalty on the Medicare
  Part D premium for coverage
• Those without creditable coverage are penalized
  1 of the monthly Medicare Part D premium for
  each month enrollment is delayed past their
  initial enrollment period

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Key Points to Remember

• The Oak Ridge retiree medical plan includes
  prescription drug coverage. This means anyone
  whos enrolled in an Oak Ridge retiree medical
  plan receives prescription drug coverage
  automatically
• Medical and prescription drug coverage are
  combined and a person cant enroll in one without
  the other
• For 2006, your Oak Ridge coverage is at least as
  generous as private Medicare prescription drug
  coverage
• Your Oak Ridge prescription drug coverage does
  not coordinate with private Medicare prescription
  drug coverage
• This means you do not need to enroll in Medicare
  Part D to keep your Oak Ridge coverage
• In fact, if you enroll in Medicare Part D, you
  will lose your Oak Ridge retiree medical coverage

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Lets stop for a minute to see if there are any
questions?
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Where to Get More Information

• OneCall
• By phone at 574-1500 or 1-877-861-2255
• CSRs available Monday through Friday, 700 a.m.
  to 500 p.m. ET
• Via the internet at http//www.y12.doe.gov
• Employee Retiree Benefits

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• Thanks for Coming!