Practical Information on the New Medicare Drug Coverage
Beginning next January 1, Medicare will provide optional prescription drug coverage (œPart D) for Medicare beneficiaries. This voluntary program replaces the current temporary œdrug discount card. You have from November 15, 2005 to May 15, 2006 to decide whether to join the new prescription drug program.
In California, eighteen insurance companies will offer competing prescription drug plans. Each plan must offer basic benefits defined by Medicare. Beyond the basics, however, companies may provide different benefits at different prices and cover different drugs. You should compare the plans to see which one best fits your needs.
The cost will vary depending on which company you select, but the average premium is about $33 a month. Each plan must provide the following coverage:
Prescription Drug Costs | Amount Beneficiary Pays | Amount Standard Medicare Part D Pays | |
Deductible (Annual) | $0-$250 | $250 | $0 |
Coverage | $251-$2250 | 25% of drug costs | 75% of drug costs |
Coverage Gap | $2251-$5100 | ALL DRUG COSTS | $0 |
Coverage | $5101 and over | 5% of drug costs | 95% of drug costs |
To be blunt, the so-called benefit gap is absurd. It resulted from congressional politics of the worst kind. It is the reason I refused to vote for the prescription drug plan. It is why I am fighting for a fairer, simpler and more complete Medicare pharmaceutical benefit.
It also is important to note that some people already are fortunate enough to be in situations where they dont need Medicare prescription drug coverage. If you already have a prescription drug plan through your employer, union, or managed care plan (e.g. Kaiser,) they should notify you by mid-November.
If you arent already covered, experts advise seniors to enroll in the Medicare program by the end of the year, so your coverage will start January 1, 2006.
Many seniors will find it troubling to pay about $33 per month, especially if their current prescription drug costs are low, but we all know health conditions can change overnight. Those who dont spend much on pharmaceuticals now may need expensive drugs in the future.
Beneficiaries with low incomes and limited savings may be eligible to receive additional assistance.
Finally, if you do not sign up before the May 15 deadline, but then later decide to enroll in the program, you will have to pay a substantial penalty every month so long as you stay in the program.
This is a new, complex program -- too complicated if you ask me. For assistance, please contact my Valley Office at (818) 501-9200.