The biggest change in Medicare in 40 years is coming Jan. 1, when the new Medicare drug benefit starts. Keep an eye on your mailbox! In the next several months, the Social Security Administration (SSA) will mail letters to about 20 million Medicare beneficiaries with limited incomes, providing “extra help,” according to Medicare Administrator Dr. Mark McClellan, in paying for prescription drug costs under the new drug benefit. The benefit will be important for many kidney patients. Today, Medicare pays for a small number of drugs. A number of these drugs are widely used by kidney patients, such as Epogen for anemia and “active” Vitamin D to maintain strong bones; but many other drugs, such as diabetes or hypertension drugs, do not have Medicare coverage. Many kidney patients may need extra help paying for drugs under the new benefit, which is actually supplemental prescription drug insurance – and this insurance won’t be cheap. For example, a typical Medicare prescription drug plan (PDP) will have a $250 deductible and $37 monthly premiums – so beneficiaries will pay almost $700 before Medicare subsidizes any costs. In addition, co-pays per prescription are 25 percent, and coverage “temporarily” stops after $2,250. There is a coverage “gap” until costs hit $5,100 ($3,600 out of pocket) and “catastrophic coverage” kicks in. Overall, Medicare will pay about half the cost of prescriptions. You can estimate how much the drug benefit may save you at AARP’s Medicare Drug Benefit Calculator (see link below). For beneficiaries with limited incomes, Medicare will provide extra financial aid. Four groups of beneficiaries are eligible for financial assistance: Those with Medicaid and incomes no higher than $9,570 (single) or $12,830 (couple) will pay no deductible or monthly premium, have full coverage (no gap), and only modest co-pays – $1 per generic and $3 per branded (free for nursing home residents). They will have no co-pays under catastrophic coverage. Those with Medicaid and incomes higher than the first group receive the same financial assistance, but co-pays per prescription are $2 per generic and $5 per branded. Those with incomes no more than $12,919 (single) or $17,320 (couple) may qualify for the same assistance as the second group – no deductible or monthly premiums, full coverage, modest co-pays ($2 per generic and $5 per branded), and no co-pays under catastrophic coverage. However, they can only have limited assets to qualify – below $6,000 (single) and $9,000 (couple). Those with incomes no more than $14,355 (single) or $19,245 (couple) may have a $50 deductible, smaller monthly premiums (on a sliding scale), 15 percent co-pays per prescription, full coverage (no gap), and modest co-pays under catastrophic coverage ($2 per generic and $5 per branded). They can only have limited assets to qualify – below $10,000 (single) and $20,000 (couple).
The SSA has a Web site about extra financial help, including an online calculator to see if you qualify (see links below). Getting a Financial Aid Application If you think you may qualify and don’t receive a Medicare drug financial aid application, or notice that you automatically qualify, you should get an application in late summer. Do this by calling the SSA at (800) 772-1213, visiting your local SSA office (see link below or check the phone book), at the SSA’s Web site, or at a local State Health Insurance Assistance Program (SHIP) office (see link below). Getting Help Applying for Extra Financial Aid SHIP offices provide free counseling. To find the nearest office, see the link below or call the Medicare hotline at (800) 633-4227. Next Steps in the Roll Out of the Drug Benefit AAKP will publish future articles about the Medicare drug benefit. As January approaches, the most important decision kidney patients will have to make is whether to sign up for a PDP. Patients will need to compare available plans in their communities, including formulary (which drugs are covered), medication therapy management, and appeals (when a needed drug is not covered). Medicare will publish information on individual plans in October. Enrollment begins Nov. 15. Stay tuned for more information! Helpful Links - Introducing Medicare’s New Coverage for Prescription Drugs (Official Medicare Booklet): Click here
- Information on the New Drug Benefit: Click here
- SHIP Help Center – SHIP Locator: Click here
- SSA’s Help With Medicare Prescription Drug Plan Costs: Click here
- SSA’s Online Calculator for Financial Aid (Qualifier Tool): Click here
- SSA’s Local Office Locator: Click here
- AARP’s Medicare Drug Benefit Calculator: Click here
- Medicare Rights Center (MRC) Q&As (MRC is a private advocacy organization.): Click here
This article originally appeared in the July 2005 issue of aakpRENALIFE, Vol. 21, No. 1.
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