During 2007, higher income beneficiaries will be responsible for one-third of the income-related adjustment. By 2009, the end of the transition period, higher income beneficiaries will pay a monthly premium equal to 35, 50, 65, or 80 percent of the total cost, depending on their income level.
Note: Medicare Part B covers 75% of allowable services, minus the deductible. Services that are not allowed are prescription glasses, dental work or hearing exams or aids.
Part C Medicare Advantage formerly known as Medicare + Choice plans
Medicare Advantage is a managed care plan, commonly known as a type pf HMO or PPO, is available in many areas. People with Medicare Parts A and B can choose to receive all of their health care services through one of these provider organizations under Part C. These plans are offered through government approved private companies. Medicare Advantage plans include:
- Medicare managed care plans;
- Medicare preferred provider organization (PPO) plans;
- Medicare private fee-for-service plans;
- and Medicare specialty plans.
A Medicare Advantage plan takes the place of a Medi-gap policy, and beneficiaries will likely have to pay a monthly premium because of the extra benefits offered. Medicare advantage plans can — but are not required to — include prescription drug coverage.
Part D Medicare Prescription Benefit
The new prescription drug benefit (Medicare Part D) became available in January, 2006, providing Medicare Eligible individuals with an opportunity to receive covered prescription drugs up to a specified upper limit by paying a monthly premium. Most drugs are listed on the plans, some must be authorized by the plan (requested by the physician) before coverage is applicable.
Medicare Part D allows Beneficiaries to choose a specific plan and purchase either standard or alternative coverage. The new benefit plans are offered through private companies, not through the traditional Medicare program. Typically a drug benefit plan will be available as a stand-alone benefit or as part of an HMO or PPO. Beneficiaries pay a monthly premium — set by each individual plan. These monthly amounts currently vary between $0 and $210. In choosing a plan, Beneficiaries must go to the list of approved plans for their local (can be 40-60+ plans) and find the plans that have their prescribed medications in the plan “formulary.” They can then compare premiums and also determine which plans are accepted by the pharmacy they use, and enroll.
In 2007, “standard coverage” will increase to a deductible of $265. Beneficiaries will also pay a monthly premium that varies between the different plans and does not count toward meeting their deductible. Typically, after they have met their yearly deductible of $265, Part D will pay the cost of the prescription drugs except for a co-payment or co-insurance, until the total annual cost of the drugs reaches $3,850. Once a beneficiary has purchased drugs totaling $3,850, Part D coverage stops. Beneficiaries must continue to pay their monthly premiums even after coverage stops. During the coverage gap they will continue to have out-of-pocket prescriptions expenses (monthly premium amounts do not count here) and a premium estimated at an average of $35 per month.
A beneficiary must enroll in Part D initially and make a program plan selection during the enrollment period each year between November 15 and December 31 — for the following year, unless the beneficiary decides to continue with the plan used in the previous year. In that case the plan automatically continues. However, because plans can and do change, it is in the best interest of the beneficiary to review his/her existing plan — and look at other options – before deciding to continue.
Once enrolled in Part D, Medicare will pay the cost of those drugs on the chosen plan’s drug formulary (list of covered drugs) after a co-payment is made. If the beneficiary’s drug costs exceed a certain level, a second deductible is reached and lower beneficiary co-payments begin. People eligible for both Medicare and Medicaid will receive drug coverage under Medicare rather than Medicaid.
NOTE: Persons eligible for benefits who do not sign up during their initial eligibility period (including those whose retirement plans offer a non-equivalent drug benefit) may be assessed a penalty that will be built into their monthly premiums forever — once they exercise their prescription drug benefit. The penalty will add 1% of the monthly premium to the
premium for each month the beneficiary opted out of coverage and continue as long as the beneficiary is enrolled in Medicare. This delay can be very costly.
Covered Preventative Services
One-time "Welcome to Medicare" Physical Exams are provided to beneficiaries when they enroll in Medicare part B. These one-time preventive physical exams include a counseling session about the preventive services, screenings, shots, and referrals for other care and are very helpful in revealing medical conditions that can receive helpful early treatment or in finding health risks that can be reduced.
Medicare will only cover this physical exam if it occurs within the first six months of Part B coverage, thus, it is important that the exam be scheduled promptly. Beneficiaries pay 20% of the Medicare-approved amount after the yearly Part B deductible ($131 for 2007) is met.
Medicare now covers screenings for heart disease – cardiovascular screenings - once every five years. These preventive services check cholesterol level and other blood fat (lipid) levels. Beneficiaries will not have to pay coinsurance or the Part B deductible for this screening.
For beneficiaries at risk for diabetes, Medicare also covers a blood sugar screening to check for diabetes. Diabetes risk factors include the following:
- High blood pressure
- Dyslipidemia (history of abnormal cholesterol and triglyceride levels)
- Obesity or a history of high blood sugar
Partial Cost of Preventative tests is Covered at Specified Intervals
- Cardiovascular screenings, cholesterol and other blood fat (lipid) levels at 100% - every five years.
- Breast Cancer Screening (Mammograms) and Prostate Cancer Screening (PSA) at 80% - every year.
- Cervical and Vaginal Cancer Screening (Pap Test and Pelvic Exam) and Bone Mass Measurements at 80% — every two years.
- Colon Cancer Screening (Colorectal) — 100% of the basic Fecal Occult Blood Test every year. 80% of other tests are covered at 2, 4 or 10 year intervals.
- Diabetes Screening (Fasting Plasma Glucose Test) — For individuals at risk at 100 % of two screenings each year.
- 80% of the cost of Diabetes Glucose monitors, test strips, and lancets for people with Medicare who have diabetes is covered after the yearly Part B deductible.
- Glaucoma Tests at 80% every year for people at high risk.
Medicare/Medicaid Dual Eligible Program
Individuals 65 and over, people who are disabled and working individuals whose incomes are below or near the annual federal poverty level [14,700 for singles, 19,900 for couples] may qualify for a dual eligibility status — combining Medicare and Medicaid covered services. Since Medicaid is a federally funded, state administered program for low income people operating differently in each individual state, the rules and coverage vary. In the instance of dual eligibility, Medicaid pays the premium for Part B, covers the state standard prescription plan except for the co-pay, and eliminates the deductible and the coverage gap.
Individual states determine eligibility, however, an asset test is applied and beneficiaries are deemed ineligible if they own property or vehicles, have investments, or earn income over the federal poverty level. To learn the eligibility requirements for individual states, contact the state or local medical assistance (Medicaid) agency.
The “Extra Help” Program
People who do not qualify as dual eligible may still be eligible for “Extra Help” with prescription drugs. If one qualifies for Extra Help, Medicare will pay all of the beneficiary’s drug costs on the appropriate state standard plan. The beneficiary will receive unlimited coverage throughout the year, except for the prescription co-pay.
Qualifying for Extra Help depends on the amount of one’s income and the value of one’s assets. To qualify, one must be eligible for and have Part A (hospital insurance), a limited income, and, in most states, assets and resources, such as bank accounts, stocks and bonds must not have a value higher than $4,000 for a single person or $6,000 for a couple.
To find out if one qualifies for Extra Help, application must be made to the Social Security Administration or to a Medicaid office. Social Security or the state Medicaid program will determine if eligibility for the Extra Help. The state Medicaid office will also know if there are additional programs in a given state to help pay for prescription drugs.
Beneficiaries having both Medicaid with prescription drug coverage and Medicare, Medicare and Supplemental Security Income, or state paid Medicare premiums, automatically will get this extra help and do not need to apply. In early November, Medicare re-assigned certain people who qualify for extra help into new Medicare Prescription Drug Plans for coverage effective January 1, 2007.
Re-assignment is based on those who qualify for extra help as of January 1, 2007. People who no longer qualify for extra help as of January 1, 2007 will not be re-assigned. Medicare is re-assigning people whose premium in 2007 would increase above the regional low-income premium subsidy amount. Medicare will re-assign people if their Medicare Prescription Drug Plan premium is more than $2 above the regional low-income subsidy amount and Medicare enrolled them
in the plan.
Any person may be asked to verify income and eligibility with Tax return from the
previous year.
How can Congregations help?
Changes in the Medicare program are very complicated and penalties can apply if individuals miss certain enrollment deadlines. The demographics of your congregation will help you know how many people could be affected by the Medicare program changes. Helping individuals in the congregation or community receive the benefits they need is important ”hands-on” mission. Suggested congregational activities include:
- Plan a program, asking a representative of the State Health Program Counselor, Area on Aging representative or Social Security Administration — if one is available — to come and explain changes in the Medicare Program
- Ask a pharmacist to come and provide information for an Older Adult program. plans and specific coverages, including generic drugs- at a gathering where individual questions could be handled may be very helpful.
- Make the internet available to those who do not have access. Prescription drug plan formulary changes — covered drugs are posted each week at the Medicare Web site.
Identify a volunteer who can check for changes in drug coverages and communicate them
to individuals who are enrolled in Medicare Part D.
- Stay informed. Older individuals and their advocates need to voice concerns to ensure that future program changes do not curtail services or make them too costly for individuals living on fixed incomes.
- ADVOCATE. There are currently 48 million people who lack healthcare, Medicare beneficiaries who reach the coverage gap are still paying for prescription drugs at prices that do not benefit from bulk pricing. There is still much to do!
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