Paying for Prescription Drugs: Medicare Part D, Extra Help and State Programs

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Paying for Prescription DrugsMedicare Part D,
Extra Help and State Programs

• AgeOptions
• 800-789-0003
• For the Make Medicare Work Coalition

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What well cover today

• Medicare Program Snapshot
• Prescription Drug Programs
• Medicare Part D
• Extra Help
• State Programs
• Where to get help

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What is Medicare?

• A federal health insurance program
• Run by the Centers for Medicare and Medicaid
  Services (CMS)
• Benefit decisions controlled by the US Congress
• Smaller coverage decisions made by CMS
• Social Security Administration handles enrollment
  eligibility

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Medicare Part A B

• Part A
• Hospital Insurance
• Hospital, skilled nursing facility, home health,
  hospice
• Part B
• Medical Insurance
• Doctors, outpatient services, preventive
  services, lab tests, ambulance services,
  equipment and supplies

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You can get Medicare benefits in 2 different ways

• Original Medicare
• or
• Medicare Advantage Plan
• Health Maintenance Organization (HMO)
• Preferred Provider Organization (PPO)
• Private Fee For Service Plans (PFFS)
• You are entitled to at least all the services
  covered by Medicare no matter which option you
  select

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Part B Premium

• Most people pay a premium for Part B
• In Original Medicare or a Medicare Advantage plan
• Many have it deducted from their Social Security
  check
• 93.50 in 2007
• You pay a higher premium if your income is above
  80,000
• Goes up every year

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Original Medicare

• Red, white and blue card
• Pay-per-service system
• Almost any doctor, anywhere in U.S.
• Limits on doctor and hospital fees
• Covers most medical needs
• Medicare Summary Notices (MSN) are now sent on a
  quarterly basis

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The Medicare Card

• .

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Medicare supplement plans fill the gaps

• Private health insurance
• 12 standard Medigap Plans A L
• Wide range of monthly premiums, depending on plan
  and your age ( from 51 to 470)
• Some types of plans with lower premiums
• Medicare Select plans
• High deductible plans (F or J)
• Limited options for people under 65 years old
• Only 2 companies sell
• Monthly premiums 300 to 500
• Do not cover prescription drugs

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Other supplemental coverage

• Retiree benefits from former employer or union
• Spouses employer group health plan

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Medicare Advantage Plans (Part C)

• Different types, each with different rules
• HMOs, PPOs, or Private Fee For Service (PFFS)
  Plans
• Medicare pays the plan a fixed amount each month
  to provide your Medicare Part A B services.
• You may have to use doctors, hospitals and other
  providers that belong to the plan.
• You are still in the Medicare program
• With Medicare rights and protections

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Medicare Advantage Plan Features

• May provide extra benefits
• Vision, hearing, dental services
• Monthly premiums may be lower than Medigap plans
• But may have higher co-payments for each service
  you use
• May include prescription drug coverage
• Called MA-PD plans

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Medicare Part D

• Prescription drug coverage
• Everyone with Medicare may join Part D
• Can sign up every November and December
• If turning 65 can sign up before and after
  birthday
• Some people may join at other times
• There is extra help for people with lower incomes
  to pay for Part D expenses
• Penalty if dont sign up when first eligible

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How Medicare Part D works

• Offered by private companies contracting with
  Medicare
• Each plan has a list of drugs it covers and a
  list of pharmacies you may use
• 2 types of plans to choose from
• An insurance plan that only covers drugs (PDP)
  or
• A Medicare Advantage Plan that covers drugs and
  your other health benefits

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What drugs are covered?

• Prescription drugs, including insulin
• Brand name and generic drugs
• The plans list of covered drugs is called the
  formulary
• Includes at least two drugs from each category or
  type of drugs
• Plan must give 60-day notice if formulary changes

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Exceptions Appeals

• You may request an exception if the plan
• Doesnt cover a drug that is medically
  necessary for you
• Requires trying a different drug first
• Has a limit on the amount prescribed
• By phone or written request
• Will usually need a doctors statement
• Plan must respond quickly
• 72 hours for most requests
• 24 hours if an emergency
• If denied, you may appeal
• First to the plan
• Several levels of appeals

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Part D Plans in Illinois - 2007

• 56 PDPs statewide
• Monthly premiums range from 17 to 106
• Average monthly premium 36
• Medicare Advantage Plans (HMO/PPO)
• 90 MA plans in Illinois (premiums 0 to 211)
• Plans vary by area
• For example, 19 in Cook County (premiums 0 to
  133)

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Part D Benefits for 2007

• Some have a deductible (up to 265)
• Between 0 and 2,400 in drug costs- you pay a
  co-pay for each prescription and the plan pays
  their part
• Count what you and the Part D plan pay for
  covered drugs
• Between 2,401 and 5,451 you pay all (donut
  hole)
• Most plans pay nothing, but some pay for
  generics, one for brands in the donut hole
• After 5,451, the plan pays 95, you pay 5
• You will have paid 3,850 out of your pocket
• You continue to pay a monthly premium

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Donut Hole What Counts?

• To get to the donut hole (2400), count both the
  total cost of the drug that you pay and what the
  plan pays.
• To get out of it (3850 total), count whats paid
  by
• You, family member or other person for you
• Illinois Cares Rx
• Medicares Extra Help (through Social Security)
• A charity program
• If you find a cheaper price than your plan pays
  (like a store discount card), you may send the
  receipt to your plan and it will count. Not out
  of country.

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What Doesnt Count

• Premiums you pay
• Any payment for a drug that isnt on the plans
  formulary
• Any amounts paid by your employer or retiree plan
• Drugs purchased outside the U.S.

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If You Are in the Donut Hole

• Check with your doctor if a generic or lower cost
  drug will work just as well for you
• Shop for the best price- save your receipts
• If you think you may reach the donut hole in the
  future, check to see if any private Prescription
  Assistance Program (through the drug companies)
  may help.
• Better not to wait until you are in the donut
  hole.

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Enrolling in a Part D Plan

• For most people, next chance to join or switch is
  November 15th - December 31, 2007
• The new plan will take effect in January 2008
• Contact the plan directly by phone or online or
  call 1-800-Medicare for help enrolling.
• Penalty if you didnt join a plan when you were
  first eligible. If you join later, you pay
• 1 extra premium for each month you were eligible
  but didnt enroll in a plan

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No penalty for enrolling later

• You may keep your current coverage and join a
  Medicare plan later with no penalty if the
  benefits are considered as good as the new plans
  called creditable coverage
• Be sure to check with your employer or union to
  see if current coverage is considered creditable
• VA coverage is considered creditable
• You can have both VA and Part D coverage to
  use at different times

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Switching Plans

• Everyone in a plan will be notified about changes
  for 2008 by November 1
• Consider whether you should change plans
• Some groups may switch any month
• People with both Medicare and Medicaid
• People on Medicare Savings Programs (QMB, SLMB,
  or QI)
• NEW People with Extra Help

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Special Enrollment Periods (SEPs)

• At any time of the year, you may enroll into Part
  D for the first time or switch to a different
  plan IF you
• are accepted into Extra Help or Illinois Cares Rx
• move into or out of a nursing home
• NEW you may switch plans if you joined a
  Medicare Advantage plan based on misleading or
  inaccurate information

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Monthly premium summary

• If you are in Original Medicare, you may pay
  premiums for
• Part B (93.50)
• Medicare Supplement plan for healthcare
• Medicare Part D plan for prescription drugs
• In a Medicare Advantage plan with prescription
  drug coverage (MA-PD), you pay
• Part B premium (93.50)
• MA-PD plan premium -healthcare and prescription
  drugs are included

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Programs for People with Limited Income and
Resources
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Medicares Extra Help/ Low Income Subsidy (LIS)
Program

• Helps pay for the consumers costs in a Part D
  drug plan
• Covers 85 - 100 of costs
• Estimated 3 to 4 million people nationwide who
  are eligible for the program but are still not
  enrolled
• Social Security Administration responsible for
  enrollments

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Extra Help - eligibility

• To qualify, you must have less than
• Annual income 15,315 (single) or 20,535
  (married couple) AND
• Resources 11,710 (single) or 23,410 (couple) -
  not counting your home, car or personal
  possessions
• If you qualify
• No premium
• Co-pays 1 generic/3.10 brand or 2.15/5.35
• No donut hole

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Automatically enrolled

• Some groups of people will be automatically
  eligible for Extra Help they do not need to
  apply. Including
• People in both Medicare and Medicaid
• People enrolled in one of the Medicare Savings
  Programs QMB, SLMB or QI
• They may choose a plan or will be assigned to one
  randomly chosen

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Applying for Extra Help

• Others may sign up for Extra Help/LIS at any
  time.
• 2-step process
• 1. Enroll in the Extra Help program through
  Social Security and
• 2. Join a Part D drug plan or you will be
  assigned to one

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How to apply

• You may submit an application in 2 ways
• Paper form
• Mail in or bring paper application to Social
  Security office
• or
• Submit online
• Directly through Social Securitys web site
  www.ssa.gov or www.socialsecurity.gov

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When you first enroll in Extra Help

• If you are already in a Part D plan, you get a
  Special Enrollment Period to switch to a
  different plan, if you wish
• If you did not join a Part D plan when you were
  first eligible, and you enroll in Extra Help in
  2007
• You will not have to pay the penalty for late
  enrollment
• You may join the plan of your choice or you will
  be randomly assigned and enrolled into a Part D
  plan

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State Prescription Programs

• For Illinois

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Medicaid

• Persons with low income over age 65 or with a
  disability
• Countable monthly income less than 876 single or
  1,166 married
• Asset limit is 2,000 individual and 3,000
  couple, not including car or home
• People with both Medicare and Medicaid are called
  dual eligible

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People with both Medicare Medicaid Drug
Coverage

• Most of your drugs are covered under a Medicare
  Part D plan
• Medicaid will still cover other medical expenses
• Automatically qualify for Extra Help dont need
  to apply
• No premiums, deductibles or gaps
• Will pay 1 generic or 3.10 brand name in 2007
• Pay 0 if in a nursing home or CILA
• Join a Part D plan or one will be assigned to you

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People with both Medicare and Medicaid
Healthcare Coverage

• If you have Medicaid and
• Original Medicare - You may go to any doctor that
  accepts Medicaid and you will pay no co-pays or
  coinsurance for covered services.
• A Medicare Advantage Plan HMO If you go to
  doctors and hospitals that are in that plans
  network, you will pay no co-pays or coinsurance
  for covered services.

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Medicare Savings Programs

• You may qualify for a state program (QMB, SLMB or
  QI) that will pay your Medicare Part A or Part B
  premiums, deductibles, and/or coinsurance IF
• Your monthly income is under 1,174 (single) or
  1,565 (couple)
• Your assets are under 4,000 (single) and 6,000
  (couple)
• Saves at least 1100 per person per year by
  paying your 93.50 Part B premium every month.

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Illinois Cares Rx

• Used to be called Senior Care or Circuit Breaker
  Pharmaceutical Assistance Program.
• This program is for
• residents of Illinois
• with or without Medicare
• who are 65 and over or who are 16 and over with
  a disability.

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Its not too late to apply

• You may apply for Illinois Cares Rx and Extra
  Help at any time
• You do not have to wait for open enrollment in
  November
• Apply online if you can at www.cbrx.il.gov
• Processed much faster than a paper application
• Online takes 4-6 weeks, paper may take 3-4 months

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Applying for Illinois Cares Rx

• File Form IL-1363, using 2006 income information
  for
• 2007 Circuit Breaker benefits (license plate
  discount and property tax grant)
• 2007 2008 prescription drug benefits
• You will get a blue card when you are approved
• You must file an application every year to renew
  benefits

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Part D plans Coordinating with Illinois Cares
Rx(2007)

• To get full benefits, you must be in one of the
  Part D plans that works with Illinois Cares Rx
• 3 PDPs are coordinating with Illinois Cares Rx
  in 2007
• United Healthcare AARP Medicare Rx
• United Health Rx Basic (formerly PacifiCare
  Saver)
• Wellcare Signature (new in 2007)
• 2 Medicare Advantage Plans in Cook County
• Wellcare (HMO)
• Health Spring (HMO) - new in 2007

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Wrap Around Benefits

• If you have Medicare and are in a coordinating
  Part D plan, Illinois Cares Rx will provide wrap
  around benefits.
• You pay
• No premium (the state pays it for you)
• No deductible for covered drugs
• No coverage gap (donut hole) for covered drugs

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Illinois Cares Rx Benefits

• Helps pay for up to 2,400 worth of covered drugs
• For each prescription you fill between 0 and
  2,400, you pay
• 2.15 for generics
• 5.35 for brand name
• 15 for specialty drugs
• Between 2,400 and 5,451 worth of covered drugs
  you pay 20 plus co-pays
• After 5,451 worth of covered drugs
• you pay 5
• you and the program (together) will have paid
  3,850 to get to this point

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25 Rebate Option

• If you have Medicare and are in a plan that does
  not coordinate with Illinois Cares Rx, you will
  not get the wrap-around benefits
• BUT
• You may stay in your Part D plan and Illinois
  Cares Rx will
• Send you a monthly check for 25 (called a
  rebate) OR
• Pay the monthly premium for a basic Medicare Part
  D plan

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Illinois Cares Rx Plus

• You must be
• 65 years of age or older
• A U.S. citizen or qualified immigrant
• (legal status / legal resident)
• Have a total annual income of no more than
• 21,936 single
• 29,412 married couple
• It covers
• Most types of prescription medicines
• Some prescribed over-the-counter drugs

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Illinois Cares Rx Basic

• Age 65 or older OR age 16 or older with a
  disability
• Yearly income less than
• 22,793 single
• 30,594 married
• For medications for 11 covered conditions, you
  pay
• 2.15 generics, 5.35 brand name 15 non-
  preferred brand names and specialty drugs
• For other prescriptions, you pay your Part D
  plans co-pays

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Basic Covers Medications for 11 Conditions

• Alzheimers disease
• Arthritis
• Cancer
• Diabetes
• Glaucoma
• Heart and blood pressure problems
• Lung disease and smoking-related illnesses
• Osteoporosis
• Parkinsons disease
• Multiple sclerosis
• HIV/AIDS

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If you have Medicare Illinois Cares Rx

• You MUST apply for Extra Help through Social
  Security Administration
• If your income or assets are too high to qualify
  for Extra Help, you still must apply
• You will get a denial letter for Extra Help
  keep it. You will still be eligible for
  Illinois Cares Rx.

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Veterans Benefits

• Veterans only are eligible not spouses or
  survivors
• In 2007, income must be less than 27,790 single
  (33,350 with one dependent)
• Must enroll to be in the program
• Get medications through VA hospitals or clinics
• Co-payments of 7 for a 30-day supply
• Call 1-877-222-8387 for an application

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Programs for people with Medicare to help pay for
medicines

• Medicaid
• Medicare Savings Programs (QMB, SLMB, QI)
• Extra Help / LIS through Social Security
• Illinois Cares Rx
• Veterans Administration
• Patient Assistance Programs free or low cost
  from the drug-maker
• Former employer/union/retiree/ group plan

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Important Dates

• October 1, 2007- Marketing begins
• End of October- Medicare You 2008 books will be
  mailed
• November 1, 2007- Annual Notice of Change Letters
• November 15 - December 31, 2007- Open Enrollment
  Period for Medicare Part D plans

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Local Help with Rx Questions
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Helpful Telephone Numbers

• Medicare-
• 1-800-633-4227
• (1-800-Medicare)
• Social Security-
• 1-800-772-1213
• SHIP-
• 1-800-548-9034
• Illinois Dept on Aging
• Senior Helpline-
• 1-800-252-8966

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If You Use the Internet

• www.medicare.gov
• Compare plans - costs, benefits, pharmacies
• Information on the Extra Help program and new
  Medicare benefits
• www.benefitscheckup.org
• Fill out a confidential questionnaire
• Find out all the programs you qualify for,
  including Illinois Cares Rx and Extra Help
• Applications and information to help you apply,
  links to other sites
• www.ssa.gov
• Application and information for Extra Help
• www.makemedicarework.org
• Find information for Illinois Medicare consumers,
  service providers and policymakers
• See events and trainings that are happening in
  your area

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Thank You!

• From the Make Medicare Work Team
• 1-800-789-0003
• Terri Gendel terri.gendel_at_ageoptions.org
• Mariam Schrage mariam.schrage_at_ageoptions.org
• Elizabeth Lough elizabeth.lough_at_ageoptions.org
• Thanh Lu tlu_at_progresscil.org

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With generous support from

• The Retirement Research Foundation
• Michael Reese Health Trust
• The Chicago Community Trust
• National Council on Aging
• August 2007