October 2005
SHIIP
Clears Up Confusion Surrounding New Medicare Prescription
Drug Plan
Lately there has been much talk and confusion
about the upcoming Medicare Prescription Drug Plans (PDPs).
The Department of Insurance’s Seniors’ Health
Insurance Information Program (SHIIP) has devised a list
of frequently asked questions that will help you understand
all of the new Medicare PDP changes.
First and foremost, one point that you should realize about
the new PDPs is that everyone who is enrolled in Medicare
Part A and/or Medicare Part B has the option to join a Medicare
PDP, regardless of income level and resources, pre-existing
conditions or current prescription expenses. Also, if you
are enrolled in a Medicare Advantage Plan — such as
HMO, PPO or private-fee-for-service plans — your plan
may also offer drug coverage.
If you have any questions about Medicare PDPs
that are not answered in the Frequently Asked Question section
below, please call SHIIP at 1-800-443-9354 or (919) 733-0111.
Frequently Asked Questions
1. How can a Medicare PDP help me?
The Medicare PDPs may save you money on the prescription
drugs that you already take or that you will need to take
in the future. A typical person enrolled in Medicare could
see his or her total drug expenses decrease by 50 percent,
and some limited-income seniors who qualify will pay almost
no prescription drug expense. PDPs will work like most other
health insurance plans, covering a large portion of your
prescription drug expenses.
2. How do Medicare PDPs work?
A Medicare PDP is an insurance plan that is provided by
a private insurance company. Several Medicare PDPs
will be available in North Carolina, and each one will be
different. After you choose the best one for you, then you
will pay a monthly premium and Medicare will help pay the
bill. You will receive information in the mail that explains
all of the options in North Carolina.
3. Do I need a Medicare PDP?
This is where it gets a little tricky. If you do not have
any other prescription drug coverage, then you do need it.
However, if you currently have prescription drug insurance
coverage that is as good or better than the Medicare PDP
coverage, then you do not need to purchase a Medicare PDP.
Also, if you have creditable prescription drug coverage
through an employer group plan, TRICARE, or the Veteran’s
Administration you should not need a Medicare PDP, and you
will receive a letter verifying the creditability of your
current coverage.
4. When do I sign up for a Medicare
PDP?
If you currently have Medicare Part A and/or Part B, you
can join a Medicare PDP from Nov. 15, 2005 to May 15, 2006.
If you sign up before Dec. 31, 2005, your Medicare PDP coverage
will begin Jan. 1, 2006, so you won’t miss a day of
coverage.
5. What if I don’t enroll in
a Medicare PDP?
You are not required to enroll, but if you are eligible
for the program and do not enroll in a PDP by May 15, 2006,
then you may have to pay a one percent penalty for each
month that is past the May 15 cutoff date. The only exception
to this is if you were currently enrolled in another prescription
drug plan that was equal to or better than Medicare’s
PDP coverage.
6. How much does a Medicare PDP cost?
Every company’s PDP will be different, but in 2006,
you should expect to pay a monthly premium of about $32
– $37 and a yearly deductible of up to $250. You will
also pay for part of the cost for your prescriptions, including
a copayment or coinsurance.
7. What if I can’t afford the
monthly premiums and coinsurance?
If you have limited income and resources, you may qualify
to receive extra help to pay for prescription drugs through
the Medicare prescription drug assistance program. To see
if you qualify for this extra help, call SHIIP at 1-800-443-9354.
You may also contact your local SSA office or visit their
national website at www.socialsecurity.gov.
