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Political / Governmental News
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An Overview for NCAL Members The Federal government has begun a massive effort to educate Medicare beneficiaries about the complex new Medicare drug benefit, which takes effect Jan. 1, 2006. Also known as Medicare Part D, the drug benefit will help many residents of assisted living/residential care (AL/RC) facilities and transform the way medications are delivered in these facilities. Although the initial enrollment period does not begin until Nov. 15, residents should begin preparing themselves now to make a series of decisions about whether the Medicare drug benefit is right for them, which drug plan to choose, and when to sign up. All American eligible for Medicare may enroll in a Medicare Part D drug plan. The government estimates that, under the new program, drug spending will go down about 50 percent for the average Medicare beneficiary who now has no drug coverage, saving her or him about $1,100. year. (And savings may be much greater for people using many prescriptions.) In addition, Medicare beneficiaries with low incomes and assets are eligible to apply for subsidies covering the new Medicare drug benefit's out-of-pocket costs, including premiums, deductibles, and co-insurance. While enrolling in a Medicare drug plan will be advantageous for many AL/RC residents, some have existing private prescription drug coverage that may be a better deal for them than the new Medicare drug benefit. Here are some important dates--and decisions facing residents--to watch for: Right now: Beneficiaries now may apply to see whether they are eligible for extra financial help in paying for the new Medicare drug benefit. Many beneficiaries have received letters from the Social Security Administration (SSA) notifying them that they may be eligible for additional subsidies to help cover their share of the cost of new Medicare drug benefit if they have low incomes and assets. Unfortunately, many seniors have been confused by this notification and think that, if their income and assets are too high to receive these extra subsidies, then they are not eligible to enroll in the Medicare drug benefit, itself. This is not the case. All people eligible for Medicare are also eligible for Medicare Part D drug benefit, regardless of income or assts. While the SSA is gathering applications for the extra subsides now, initial enrollment in the Medicare drug plans will not begin until Nov. 15. It is important to note that, for many people, knowing whether they might qualify for extra help in paying for the Medicare drug benefit will help them to decide whether it is advantageous to enroll in a drug plan come Nov. 15. If beneficiaries have not received a letter form the SSA and think they may qualify fo subsidies, they may call 1-800-772-1213, or visit www.socialsecurity.gov on the web, or apply at their State Medial Assistance office to obtain more information and application forms. After they submit applications, the SSA will respond with a letter telling them if they qualify for these extra subsidies to help pay for the Medicare drug benefit. As of Sept. 22, figures released by the SSA showed that 3 million out of a total of 18.6 million Medicare beneficiaries who were sent letters had applied for the extra financial help. Oct 1, 2005: Medicare prescription drug plans and Medicare Advantage (managed care0 plans that offer Medicare drug benefits along with other coverage can begin marketing Medicare drug coverage on Oct. 1. On Sept. 23, the Enters for Medicare & Medicaid Service (CMS) announced that between 11 and 20 organizations were offering prescription drug plans in each region and nine nationwide. In every state except Alaska, at least one prescription drug plan will offer a premium of less than $20 a month. according to CMS. In every state, at least five prescription drug plans will offer coverage with no premium to beneficiaries with low incomes and assets who qualify for the extra financial help mentioned above. Also, in 44 states, beneficiaries will be able to select a Medicare Advantage (managed care) plan that provides presciption drug coverage for no additional cost. In 37 states, beneficiaries across the state will be able to choose a new regional preferred provider organization (PPO) plan. For information on organizations offering Part D coverage, people can click onto their state on the map on the CMS web site at: http://www.cms.hhs.gov/map/map.asp. CMS has indicated that information on specific plans will be available shortly. All Part D drug plans provided by these organizations are required to provide coverage at least as good as Medicare's standard coverage, which pays on average 75 percent of drug costs after a $250 deductible up to $2,250 in total drug spending. The coverage also pays approximately 95 percent after $3,600 in out-of-pocket costs to protect against very high drug expenses. October 2005: CMS will mail the Medicare & You 2006 handbook, which contains information about prescription drug plan choices, to all Medicare beneficiaries. Comparative plan information and tools to help Medicare beneficiaries decide whether they might benefit from the new drug coverage and to help them compare plans will be available on Medicare's web site: www.medicare.gov. CMS officials have said that that, beginning Oct 13, beneficiaries will be able to access three new tools on a section of the Medicare web site that will help them choose a plan and enroll. One of the web tools is designed to help beneficiaries with no existing drug coverage by allowing them to enter their monthly drug costs and see how much money they could save under the new benefit. another tool will assist those who already know which drug plan they want in completing the enrollment process. In addition, the tool can hehlp those who do not know which plan they want to providing customized plan options and alerting beneficiaries whether they already are enrolled in a Medicare Advantage or Medicaid plan or have employer-sponsored coverage. October 2005: CMS will begin automatically enrolling "dual eligible" beneficiaries--those covered by both Medicare and Medicaid--into Medicare prescription drug plans. It is estimated that about 120,000 of the roughly 1 million residents of AL/RC facilities fall in the dual eligible category. After they are assigned to Medicare prescription drug plans, dual eligibles who wish to switch plans may do so. November 2005: Medicare beneficiaries' (or their spouses') former or current employer or union are supposed to send them information about how their current drug coverage, if they have it, compares to the Medicare standard prescription drug coverage by November 14, 2005. This information is important because it can affect the decision that beneficiaries make about whether, and when, to sign up for Medicare prescription drug coverage. To make informed decisions, it is in residents' interest to find out whether they have existing drug coverage and whether their existing drug coverage qualifies under the Medicare drug law as being "creditable" (that is, good as Medicare's drug benefit). Nov. 15, 2005: This is when the initial, six-month enrollment period begins for the new Medicare drug benefit. Beginning Nov. 15, people can join a Medicare Prescription Drug Plan in the following ways:
Dec. 31, 2005: This is the last day to enroll for those who want benefits to begin Jaqn. 1, 2006. Enrollment during the rest of the initial open enrollment period will be effective the first day of the month following enrollment. Jan. 1, 2006: Coverage under the new Medicare drug program begins. May 15, 2006: This initial enrollment period ends. Most people waiting to enroll in a edicare drug plan until after May 15, 2006 will have to wait until Nov. 15, 2006 to do so. Those waiting until after May 15 to enroll also may have to pay a penalty (which, for most, would increase their premiums 1% for each month they waited to enroll past May 15) if they are not covered by another plan with prescription drug benefits at least as good as those offered by Medicare (also called "creditable coverage"). Nov. 15, 2006: This is the beginning of the annual open enrollment period in which beneficiaries may sign up for coverage or switch plans, effective Jan. 1, 2007. From this point on, annual enrollment periods will be held from Nov. 15 to Dec. 31. Here are some other resources provided by CMS: "Basic Questions and Answers about Prescription Drug Coverage" (updated 09/08/05) http://www.cms.hhs.gov/partnerships/news/mma/qsandas.pdf This 15-page document provides basic information about many of the important decisions beneficiaries face concerning the new Medicare drug benefit. "Important Information for Health Care Professionals," a power point presentation http://www.cms.hhs.gov/medlearn/Rxppt-ShortVersion-8-18-05.zip "Additional Help to Those Who Need It Most: Those with High Drug Costs and Those with Low Incomes" 1/21/05 http://www.cms.hhs.gov/medicarereform/issuepapers/title1and2/files/issue_paper_ 03_additional_help_to_those_who_need_it_most.pdf This issue paper discusses the benefits and costs of Medicare drug coverage for people with low incomes and high prescription drug costs. NCAL will continue to keep members apprised of developments concerning implementation of the Medicare Part D program. For more informaiton, contact Karl Polzer at 202-898-6320.
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