The Medicare Program: Then

1
The Medicare Program Then Now

• Suburban Area Agency on Aging
• and
• Progress Center for Independent Living

2
Content

• Medicare Basics
• Help from the State in 2005
• Medicare Prescription Drug Improvement and
  Modernization Act of 2003 (MMA) Basics
• The Prescription Drug Coverage
• Extra State Help for Low-income Beneficiaries
• Other Helpful Information
• Questions and Answers

3
What is Medicare?

• A federal health insurance program for
• People over 65 years old
• Some people with disabilities (receiving SSDI for
  ?24 months)
• People with end-stage renal disease (ESRD)
• People with amyotrophic lateral sclerosis (ALS),
  a.k.a. Lou Gehrig's Disease
• Administered by Centers for Medicare and Medicaid
  Services (CMS) within HHS
• Covers 41 million people - 35 million older
  adults and 6 million under age 65
• Benefit decisions controlled by the U.S. Congress
• Social Security Administration or Railroad
  Retirement Benefits handle enrollment

4
Medicare was never intended to pay 100 of
healthcare bills

• Protection against basic and large medical
  expenses
• Focus on illness or injury care
• Leaves gaps where the consumer must pay
• Does not cover
• Long-term care in a nursing home
• Most outpatient prescription drugs
• Routine physicals, vision, hearing, dental, or
  foot care
• Health care outside the U.S.

5
More Medicare Coverage

• Drugs covered by Medicare Part B
• Most drugs injected by a licensed medical
  practitioner and other drugs for people with
  ESRD, osteoporosis, hemophilia, transplants,
  cancer, and some antigens
• You pay 20 coinsurance
• Preventive services
• Screening Mammograms
• Pap Smears
• Bone Mass Measurement
• Colon Cancer Screening
• Diabetes Self-Management
• Immunizations
• Prostate Cancer Screening
• New for 2005 - Welcome Exam, Cardiovascular
  Testing, Diabetes Screening

6
You can get Medicarebenefits in 2 ways

• Original Medicare Program
• or
• Medicare Advantage Plan (Part C)
• Health Maintenance Organization (HMO)
• Private Fee For Service Plan (PFFS)
• You are entitled to at least all the services
• covered by Medicare no matter which option
• you select.

7
Medigap or Medicare Supplemental Coverage

• Private supplemental health insurance to fill
  gaps in Medicare coverage
• 10 standardized plans (Plans A-J)
• For people with disabilities fewer plan choices
  (plans A, B, or F)
• May ask health questions not guaranteed issue
• Regulated by the State and Federal Law
• Will change in 2006

8
Medicare Advantage (Managed Care) Plans

• Offered by private companies
• Available in certain areas only
• Plan can join or leave Medicare each year
• Providers can leave the plan
• Benefits and premium may change each year
• Must accept all people with Medicare Parts A B
  (except those with ESRD-serious kidney disease at
  time of enrollment)

9
Original Medicare has 2 Parts

• Part A
• Hospital Insurance
• Hospital, skilled nursing facility, home health,
  hospice
• Part B
• Medical Insurance
• Doctors, outpatient services, preventive
  services, lab tests, ambulance services,
  equipment and supplies

10
Paying for Medicare Part A

• Most people receive Part A premium free
• People with employment will pay a Part A premium
• In 2005, 296 or 375 a month, depending on
  number of quarters worked
• Call SSA for more information
• 800-772-1213
• 800-325-0778 for TTY users

11
Part A 2005 Costs to Beneficiaries

• Hospital deductible 912
• may be more than once per year
• for longer stays, you pay daily coinsurance
• days 1-60 0
• days 61-90 228 per day
• days 91-150 456 per day
• Skilled nursing facility
• days 1-20 0
• days 21-100 114 per day
• over 100 days, you pay all cost

12
Paying the Part B Premium

• Taken out of your monthly payment
• Social Security
• Railroad Retirement
• Office of Personnel Management (OPM)
• May be billed every 3 months
• Medicare Easy Pay automatic withdrawal from
  bank account

13
Part B 2005 Costs to Beneficiaries

• Monthly premium 78.20 in 2005
• In addition to any private supplemental insurance
• Annual deductible 110 in 2005
• Medicare usually pays 80 of Medicare approved
  amount for doctors services
• 50 outpatient mental health
• Outpatient emergency room, outpatient hospital
  and surgery services are a fixed amount that
  could be more than 20
• Ask if the doctor accepts Medicare assignment

14
Enrolling in Medicare Part B

• Initial Enrollment Period for those turning 65
• 7 months (begins 3 months before age 65) need
  not be retired
• General Enrollment Period
• January 1 through March 31 each year
• Coverage effective July 1
• Premium increases 10 for each 12-month period
  you were eligible but did not enroll
• You carry this increase for the rest of your life
• Limited exceptions

15
Enrolling in Medicare Part B (cont.)

• Special Enrollment Period
• Sign up within 8 months of the end of employer or
  union group health plan coverage
• No increased premium
• Automatic Enrollment in Original Medicare
• After 24 months of disability payments (w/o
  additional applications)
• Except for ALS (Amyotrophic Lateral Sclerosis or
  Lou Gehrig's Disease) - begins first month
• Will receive card by mail
• 3 months before 25th month (call SSA if it
  doesnt arrive)
• Decide on Part B - avoid penalty (check with SSA
  or CMS)

16
Continuing MedicareEntitlement

• Ends when SSA determines you are no longer
  disabled
• Continues for working beneficiaries who are still
  disabled
• 8½ years premium-free Part A
• May purchase coverage afterward
• Entitlement reason changes at age 65

17
Current Prescription Help Available

• State, Medicare-related and Private Programs

18
Current Program Options for People in Illinois

• State
• Medicaid
• SeniorCare
• Circuit Breaker/ Pharmaceutical Assistance
• Illinois Rx Buying Club
• I-Save Rx
• Federal
• Medicare
• Covered drugs
• Discount cards
• Transitional Assistance
• Veterans Administration (VA)

• Private
• Retiree plans
• Medigap insurance
• Medicare Advantage (HMO)
• Discount cards
• Patient Assistance Programs (drug makers)
• Store discount programs
• Internet

19
Assistance for people with low incomes (and
limited assets)

• Medicare Savings Programs
• QMB (Qualified Medicare Beneficiary)
• Pays Part B premium, co-pays and deductibles
• Limit of 798 monthly income for single person
• SLIB (Specified Low Income Medicare Beneficiary)
  QI1 (Qualifying Individual)
• Pay Part B premium
• Limit of 957 1077 monthly income for single
  person
• QDWI (Qualified Disabled and Working Individual)
• Medicaid federal-state health insurance program

20
Medicaid

• Persons over 65, or disabled or blind at any age
• Drug coverage and medical services
• Income less than 798 single or 1,069 married a
  month
• Asset limit is 2,000 individual and 3,000
  couple, not including car or home
• Drugs cost 0 generic or 3 brand name

21
State ProgramsSeniorCare or Circuit Breaker

• One application for both programs
• State decides which one you qualify for
• You must re-apply every year

22
Circuit Breaker/Pharmaceutical Assistance

• Age 65 years and over or on disability (age 16 or
  over)
• Pays for medications for 10 specific illnesses
• Income Eligibility - Less than 21,218 single or
  28,480 married
• Cost 5 or 25 to apply (per year)
• Co-payments 3 generic and 3 plus difference
  brand-name
• Pays up to 2,000, then you pay 20

23
SeniorCare

• Age 65 years and over
• Covers most prescription medications
• Covers some prescribed over-the-counter drugs
• Income Eligibility - 19,140 single or 25,660
  married
• No fee/cost to apply
• 1 generic and 4 brand name
• Pays up to 1,750, then you pay 20
• 25 per month stipend instead of SeniorCare
  benefits if you already have insurance coverage
  for drugs

24
Some helpful tips

• Ask doctors for samples and talk with them
  honestly about your ability to pay for
  medications
• Larger chain/discount stores
• Larger quantities 90 days supply not 30
• Cut larger dose in half (when safe to do)
• Generic medicine (if doctor agrees)
• Mail Order
• Always carry an up-to-date list of your
  medications

25
The New Medicare Law

• How is Medicare Affected?

26
Medicare Modernization Act (MMA) of 2003

• Signed into law December 8, 2003 (Public Law
  108-173)
• Largest expansion of Medicare since 1965
• Includes new options for prescription drug
  coverage and other changes

27
Changes to the Medicare Program

• New preventive benefits added
• Increases in Part B deductible in 2005 (from 100
  to 110) will increase each year
• Increased payments to providers in 2004
• Prescription drugs benefits - indexed to cost of
  drugs (value of benefits decrease and
  out-of-pocket expenses increase significantly
  over time)
• 2004-2005 prescription drugs discount cards
• 2006 prescription drug benefits

28
MMA Drug Benefit Timeline

• Temporary Prescription Discount Card
• June 2004 December 31, 2005
• Transitional Assistance (300 credit)
• June 2004 December 31, 2005
• Amount goes down if you wait to apply
• Medicare Part D Prescription Drug Plan coverage
  
• Begins January 1, 2006

29
Medicare-Approved Drug Discount Cards

• Temporary program ends December 31, 2005
• Average savings from 10 to 25 (higher discounts
  for generics)
• Annual enrollment fee 0 to 30
• Must include this seal

30
Help with Transitional Assistance Costs for
People with Limited Income

• No fee for the discount card (Medicare pays it)
• You pay 5 or 10 of the discounted cost of each
  prescription (depends on income)
• 300 credit on the card can use through 2005
• can apply to almost any drug (not just those on
  list)
• works like a prepaid phone card or debit card
• Pro-rated benefits each quarter (300, 150)
• Some cards provide significant savings on certain
  drugs after the credit is used up
• Important to select one of these cards

31
Whos eligible for the 300 credit in 2005?

• Income less than 12,920 single or 17,321 couple
• Not getting drugs through full Medicaid,
  SeniorCare or employer/retiree plan
• If get a card and credit before enroll in
  Medicaid, may keep the card and credit
• May apply for the credit if havent yet reached
  the spend down limit (not enrolled in Medicaid
  for that period)
• May apply for the credit and SeniorCare at the
  same time (separate applications) if not yet
  enrolled
• Those getting outpatient medications from VA may
  be eligible
• Estimated 84,300 people eligible in Chicago metro
  area (Cook and collar counties)

32
Act Now!

• Enroll in programs to help pay for your
  prescription drugs throughout 2005
• Apply for the full 300 credit on your discount
  card
• Apply/re-apply for SeniorCare/Circuit Breaker
• Enroll in Medicare Savings programs (QMB, SLIB,
  QI-1, QDWI)
• Will make it easier to get benefits for 2006 if
  already in one of the programs
• Find out about new plans and what you need to do
  enroll in them

33
The Medicare Prescription Drug Coverage

• What to Expect in 2006

34
Features of Medicare Prescription Drug Benefits

• Opportunity to buy a private plan, subsidized by
  Medicare (open to all Medicare eligibles)
• Plans contract with Medicare to offer plans in
  different regions and must meet Medicares
  requirements
• 2 kinds of plans to choose from
• A plan that only covers prescription drugs or
• A Medicare Advantage plan (HMO or PPO)
• Each plan negotiates its own discounts and
  decides the list of drugs it will cover
  (formulary)

35
More Features of Medicare Prescription Drug
Benefits

• Lifetime penalty if you dont enroll when first
  eligible
• Premiums increase by 1 for each month you
  delayed enrollment in Medicare PDP
• Most existing Medicare consumers must sign up
  from Nov 15, 2005 May 15, 2006
• If your current prescription drug coverage is at
  least as good as that offered under the new
  Medicare plans, you may stay in it without
  penalty
• Plans must send notices to all beneficiaries
  explaining whether there is at least as good as
  Medicare PDP
• Have through June 2006 to change plans
• After that, must remain in plan you choose for
  the rest of the year
• 2007 and beyond, will have 3 months
  (JanuaryMarch ) to change
• Dual eligibles may change plans anytime during
  the year

36
Enrollment in Part D plans

• Called Medicare prescription drug coverage
• CMS responsible for helping people enroll in
  plans
• Applications accepted beginning November 15
• Available online, by calling 1-800-MEDICARE, or
  written application
• Apply to plan sponsor (company) and CMS will
  check for eligibility
• IL Department on Aging working on a decision
  support tool to help select best plan for you

37
Your Drug Plan Options in 2006

• Stay in employer-sponsored health plan (retiree
  or employee)
• New stand-alone Prescription Drug Plans (PDP)
• Adds prescription drug coverage to Original
  Medicare
• Medicare Advantage plan
• HMOs, PPO, new regional PPOs
• Includes your Medicare benefits and may cover
  prescription drugs (MA-PD)
• May be specialized plans for certain groups
  (e.g., in nursing homes)

38
Filling the gaps in coverage Employer State
Plans

• Plans must offer standard (basic Medicare)
  benefit or actuarial equivalent plan
• expect to see different benefit designs (like
  tiered drug levels)
• Plan sponsors may offer enhanced coverage for
  additional premium
• Supplemental (wraparound) coverage also may be
  provided by employer plans, state and charitable
  organizations pharmacy assistance plans

39
If staying with Original Medicare

• You will continue to pay
• Part B premium
• Medigap insurance premium or Medicares
  co-payments
• In addition, you will pay
• Prescription Drug Plan premium and co-payments
  (plus whatever costs the plan does not cover)

40
How it Might Work in 2006 Basic Plan (not to
scale)
41
Expected Changes in Premiums Cost-sharing
42
Extra Help for People with Limited Income
Resources

• Extra help will be available to pay for the costs
  of the Medicare PDPs
• Depends on income (below 150FPL) and resources
• Incomes less than 14,355 (single)/19,245
  (couple)
• Resources less than 10,000 (single)/ 20,000
  (couple)
• Those on both Medicare and Medicaid automatically
  eligible
• 2-step process enroll in subsidy in spring and
  summer and enroll in a drug plan in the fall
• Some people will be automatically enrolled in the
  programs
• You will receive letters from Social Security or
  Medicare explaining what to do, if you are likely
  to qualify for extra help
• If you qualify there are no gaps or donut hole

43
Extra Help to Pay for Your Prescription Plan
44
Enrollment in Extra Help

• Social Security responsible for enrollment
• Will send letters to 800,000 in Illinois that
  expect might be eligible between May 27 and
  August 15
• Includes scannable application (cant copy
  special paper)
• Many ways to apply written app, on-line, phone
• No documentation required
• Looking for places/events to assist people to
  apply
• Aging network will play a role
• Medicaid offices also must accept applications
• Also required to screen for eligibility for other
  programs (e.g., Medicare Savings Programs)
• All details not yet set

45
People with Limited Income and Resources

• 2 groups
• Those who automatically qualify dont need to
  apply
• Dual eligibles (Medicare and full Medicaid)
• People in Medicare Savings Programs
• Those who must apply to get extra help
• Everyone else who might qualify

46
People with both Medicare and Medicaid (Dual
Eligibles)

• Prescription drugs currently paid for by Medicaid
• Automatically qualify for extra help (deemed
  eligible) and wont need to apply
• Will get letter in May or June letting them know
  they are automatically eligible
• January 1, 2006 Medicaid coverage for drugs ends
• Coverage will come from a Medicare Prescription
  Drug Plan (PDP) instead
• Medicaid will still cover other medical expenses
• If dont sign up for PDP, will be randomly
  assigned to one
• Get letter saying they have been assigned to Plan
  X
• May switch prescription drug plans at any time to
  meet their needs

47
People in Medicare Savings Plans (QMB, SLIB, QI,
QDWI)

• Automatically qualify for extra help dont need
  to apply
• Will get letter in May or June letting them know
• Must select and enroll in a Medicare prescription
  drug plan between Nov 15, 2005 and May 15, 2006.
• If dont join a plan, will be assigned to one on
  June 1, 2006.

48
Others must apply for extra help

• Receive applications in the mail from Social
  Security some time between May 27 and August 16.
• If dont receive application in the mail, can
  always apply at local Social Security or
  Medicaid office
• May send back application, apply over the phone,
  get help from a local agency, go to an enrollment
  event or apply on-line (after July 1.)
• Dont need to send any proof of income or assets.
• Social Security may call if they need more
  information to process the application.

49
Important 2005 Dates Extra Help

• Spring Summer
• - People with lower incomes may apply for extra
  help program
• Late May through August application from Social
  Security for extra help mailed to people who
  might be eligible
• - Send application back, or get personalized
  assistance completing it from a community event,
  local agency, or by phone
• June CMS begins sending notices to those deemed
  eligible to tell them they dont need to apply
  for extra help
• - Dual eligibles (Medicare and full Medicaid)
• - People in Medicare Savings Programs (QMB,
  SLMB, QI-1, QDWI)
• July Social Security begins processing the
  applications and notifying people about
  eligibility

50
Medicare Prescription Drug Coverage 2005
Enrollment

• October Everyone already receiving or eligible
  for Medicare will receive information about the
  new prescription drug plans available in their
  area (The marketing begins!)
• Medicaid will send notices to dual eligibles
  explaining that their drug coverage will switch
  from Medicaid to Medicare Part D and must be
  enrolled in a new Medicare plan beginning January
  1.
• Dual eligibles will be automatically enrolled in
  a plan if they dont choose one themselves, but
  may change plans at any time.
• Employers other Rx coverage sponsors will send
  notices to their recipients explaining whether
  their plans meet the creditable coverage test,
  allowing beneficiaries to keep their current
  coverage with no penalty
• November 15 December 31 Everyone can sign up
  for new plans which will start January 1, 2006

51
Important 2006 Dates

• January 1
• Drug coverage begins!
• People with both Medicare and Medicaid, now
  receive prescription coverage through a Medicare
  PDP (other benefits still through Medicaid)
• January May 15
• Medicare eligibles may apply for new plans
  without penalty (1 penalty for every month not
  on a Part D plan after May)
• After May 15
• If you decide to join a plan now, you will pay a
  higher premium (if dont have existing creditable
  coverage)

52
What About the State Programs in 2006?
53
What will Happen to State Programs in 2006?

• No Senior or Person with Disabilities Left
  Behind
• State is working to try to keep current benefit
  levels by using a combination of state and
  Medicare programs
• Dept of Healthcare and Family Services (Pub Aid)
  leading interagency work groups to sort out
  details
• Designing wraparound for Circuit Breaker and
  SeniorCare to fill in the gaps of Part D plans
• People eligible for Medicare and State programs
  should apply for both the Extra Help and a Part D
  plan

54
State programs (cont.)

• Some people in Circuit Breaker and SeniorCare are
  not eligible for Medicare. The programs will
  function as before for them, with only minor
  changes like the elimination of Circuit Breakers
  enrollment fee.
• For the majority with Medicare, SeniorCare and
  Circuit Breaker benefits will look similar to the
  current programs.
• No premium, no deductible, and 2 generic 5
  brand-name copays for spending up to 1,750
• 20 coinsurance and 2/5 copays from 1,751 -
  5,100
• Above 5,100 in drug costs, Medicare will cover
  95
• Circuit Breaker will continue covering drugs for
  specified conditions
• Once Part D plans are available, we will have
  more details.

55
Outreach, Education, Decision-Support,
Enrollment Challenges

• Complexity of the options and processes
• 2-step enrollment for low income subsidies
• Coordination of the numerous state and private
  programs
• Anxiety factor
• Scale of the effort the majority of people on
  Medicare will have to make a choice and take
  action
• Need to make informed decisions impact of
  choosing a health plan goes far beyond Rx
• Short time frames timely enrollment to avoid
  penalties

56
Challenges (cont.)

• Coordination among groups to
• Find the hard-to-reach individuals
• Deliver clear and consistent messages
• Assist key players at federal, state, regional
  and local levels to maximize and avoid
  duplicating efforts
• Methods - need varied approaches with lots of one
  on one assistance and cultural competence
• Important to address the Medicare consumers
  barriers healthcare literacy, mental and
  physical impairments, language, isolation

57
Big Task - Lots of Help

• Many organizations are focused on helping educate
  and enroll people into the programs
• SSA
• CMS
• SHIP
• Coalitions
• AAAs
• Centers for Independent Living
• Community organizations, faith-based, ethnic
• CMS partners and contractors
• Focus on local level, grass roots, and trusted
  sources for help
• Training will be available

58
Other Helpful Information

• Warnings and Resources

59
Scam Artists Already at Work

• The new programs complexity and confusion breed
  fraud
• Already reports of fraud in Illinois
• Southern Illinois caller asks to come over to
  talk about Part D and asks for personal
  information
• Chicago people have gotten calls
• SHIP has received reports of callers
• Selling discount cards door to door
• Charging large amounts to help apply
• Calls asking for personal information

60
Don't be a Victim!

• If it seems too good to be true, it probably is
• Dont give out your Medicare or Social Security
  number
• Keep track of and read your mail carefully
• Report any suspicious marketing practices
• Include consumer protection/Senior Medicare
  Patrol messages in every presentation

61
Need help deciding or applying?

• HealthCare Choices Resource Center (Suburban Area
  Agency on Aging) --- 1-800-789-0003
• Progress Center for Independent Living ---
  708-209-1500
• SHIP counselors --- 1-800-548-9034
• Elder Care Locator --- 1-800-677-1116 (anywhere
  in US)
• Senior Help Line (IL Dept on Aging) ---
  1-800-252-8966

62
BenefitsCheckUp

• On the Internet
• confidential questionnaire
• One place for information on all Rx programs
• Find out which programs you qualify for
• State, federal and local programs
• Learn where to apply and what you will need
• Get help from the Suburban Area Agency on Aging
  OR
• www.benefitscheckup.org
• www.suburban-age.org
• www.accesstobenefits.org

63
Medicare Resources

• 1-800-Medicare
• www.medicare.gov - consumers and service
  providers
• www.cms.hhs.gov/partnerships - to order or
  download materials
• BSPGtraining_at_cms.hhs.gov - to reach National
  Medicare You Training Team member or be added
  to their listserv
• www.cms.hhs.gov/partnerships/tools/materials/medic
  aretraining/MPDCoutreachkit.asp - new toolkit
• http//pubordering.cms.hhs.gov/mailinglist/ - to
  order CMS materials and publications directly

64
Other Internet Resources

• www.accesstobenefits.org
• Answer a confidential questionnaire
• Find out all the programs you qualify for
• Get help deciding which is best for you
• Applications and information to help you apply
  for the programs you choose
• www.makemedicarework.org
• Find information for Illinois Medicare consumers,
  service providers, and policymakers
• See calendar of the events and trainings
  happening in your area

65
Questions and Answers

• If we dont know the answer, well follow-up at a
  later date