Understanding Changes in the

1
Understanding Changes in the Medicare
Prescription Drug Program Geriatric Noon Seminar
Series OBleness Memorial Hospital August 15,
2005 Presented by Access to Benefits Coalition
Ohio Chapter Kathleen Gmeiner, JD, MHSA (614)
443-2845 kgmeiner_at_columbus.rr.com
2
Who Will Be Eligible for the Medicare
Prescription Drug Benefit (Medicare Part D) in
Ohio?

• The 1.8 million people in Ohio who are eligible
  for Medicare Part A (hospitalization) or enrolled
  in Part B (outpatient care).

3
Who is eligible for Medicare?

• People who have reached age 65
• People with disabilities who have received Social
  Security Disability Benefits for 24 months.
• People with permanent kidney failure and people
  with Amyotrophic Lateral Sclerosis (ALSalso
  called Lou Gehrigs Disease).

4
Does the government already pay for the
prescription drugs of some Medicare
beneficiaries?

• Yes Some Medicare beneficiaries are
• also eligible for Medicaid.
• They are called dual eligibles,
• and Medicaid pays for their drugs.
• But soon they, too, will get their
• prescription financing through Medicare.
• Medicare beneficiaries may also be eligible
• for prescription help through the Veterans
• Administration or other military retirement
  plans.

5
When will the Medicare Prescription Drug Benefit
start?

• January 1, 2006 but theres a lot to do before
  that day!

6
What must be done between now and January 1, 2006?

• Apply for a low income subsidy
• Enroll in a prescription drug plan (PDP).

7
About the Medicare Prescription Drug Benefit
8
How Does the Medicare Prescription Drug Benefit
Work?

• The Medicare Beneficiary Pays a Premium about
  32.20/month average in 2006.

9
How Does the Medicare Prescription Drug Benefit
Work?

• Beneficiary pays a premium every month of about
  32.
• Medicare does not pay anything for the first 250
  of incurred drug expenses (the deductible).
• For the next 2,000 of covered prescription
  expenses, Medicare pays 75 and the beneficiary
  pays 25.
• When incurred expenses reach 2250 (including
  what Medicare pays for), Medicare starts paying
  NOTHING. Thats the famous Doughnut Hole.
• While in Doughnut Hole, beneficiary still pays
  premium.
• After the beneficiary incurs 5,100 of covered
  prescriptions, Medicare pays about 95 percent.

10
The following charts use an example of a
beneficiary paying 5400 per year for drugs 6
prescriptions/month averaging 75/prescription
11
How do people pay for drugs in the Doughnut
Hole?

• People will be able to get discounts through
  their PDPs.
• Some who are not eligible for Extra Help (LIS)
  MAY be eligible for manufacturers assistance
  plans (but this is still being worked out at the
  federal level).
• Some plans may charge a higher premium and
  co-pays to eliminate the doughnut hole.

12
Beneficiaries must enroll in a PDP

• The benefit will be provided through private
  plans. These are called Prescription Drug Plans
  (PDPs).
• Each PDP will have its own drug formulary.
• The formularies dont have to contain all drugs,
  but they must contain at least two in each
  therapeutic category and class.
• Rules prohibit discrimination against particular
  diseases.
• Drugs that Medicaid is not required to pay for
  will not be in the formularies. These include
  benzodiazepines, barbituates and over-the-
  counter medications. As far as we know Ohio
  Medicaid will still pay for medically necessary
  benzodiazepines and barbituates for those on
  Medicaid.

13
Deciphering the lingo

• Deductible an amount the beneficiary must pay
  before the drug plan begins paying for the
  benefit.
• Formulary The specific drugs that the PDP will
  pay for.
• Prescription Drug Plan (PDP) The set of
  prescription benefits offered by a private
  company in which the beneficiary enrolls.
• Therapeutic category and class a therapeutic
  category would be cardiovascular drugs, and the
  class would be beta blockers.

14
About the Low Income Subsidy Extra Help
15
What about Medicare beneficiaries who cant pay
their share?

• Most of the cost-sharing can be eliminated by the
  Low Income Subsidy (LIS) also called Extra
  Help.
• Those enrolled in LIS will pay VERY LITTLE for
  prescription coverage.
• But few are enrolled!

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Who Can Receive a Full Low Income Subsidy ?

• Medicare beneficiaries on Medicaid
• Medicare beneficiaries on SSI
• Medicare beneficiaries on Medicare Savings
  Program
• Medicare beneficiaries with

Income no higher than 135 percent of the federal
poverty level
Assets no higher than 7,500 for a single person
and 12,000 for a married couple (including 1500
per person for burial expenses).
AND
17
The 7.2 million people eligible for the LIS are
concentrated in certain states
NH 29K
WA 134K
ME 52K
VT 14K
MT 32K
ND 31K
MN 138K
OR 74K
MA 148K
ID 54K
NY 486K
WI 93K
SD 27K
MI 249K
RI 37K
WY 18K
CT 55K
PA 382K
IA 86K
NE 61K
NJ 222K
OH 328K
NV 50K
IL 311K
IN 175K
UT 39K
DE 14K
CA 465K
VA 169K
WV 94K
MD 133K
CO 66K
KS 84K
MO 86K
DC 19K
KY 94K
NC 238K
TN 160K
OK 103K
AZ 140K
SC 133K
AR 94K
NM 73K
Low-income subsidy-eligibles not currently in MSP
or Medicaid 200K 100-200K
60-100K GA 220K
AL 145K
MS 91K
TX 470K
LA 148K
AK 4K
FL 618K
HI 17K
Source Centers for Medicare and Medicaid
Services, CMS Statistics Medicare State
Enrollment US Census Current Population Survey
CMS, Evaluation of QMB and SLMB Programs, Final
Report Vol. 1 The Kaiser Commission on Medicaid
and the Uninsured, Implications of the New
Medicare Law for Dual Eligibles 10 Key Questions
and Answers
18
What will the full low income subsidy (extra
help) get you?

• You will have no premium
• You will have no deductible
• You will have a reduced copayment or no copayment
  (Long term care no co-payment).
• The following charts use an example of a
  beneficiary paying 5400 per year for drugs 6
  prescriptions/month averaging 75/prescription)

1/3 copayment
2/5 copayment
19
Full Low Income Subsidy Who qualifies and what
do they get?
BIG CHANGE?
Slide from Access to Benefits Coalition--
National April 2005emphasis added by Ohio Chapter
20
Who Can Receive a Partial Low Income Subsidy ?
Income no higher than 150 percent of the
federal poverty level
Assets no higher than 11,500 for a single
person and 23,000 for a married couple
(including 1500 per person for burial expenses).
AND
21
What will the partial low income subsidy (extra
help) get you?

• Sliding Scale Premium
• 50 deductible
• 15 co-insurance up to 5,100
• Co-pay 2/5 after 5,100

• (The following charts use an example of a
  beneficiary paying 5400 per year for drugs 6
  prescriptions/month averaging 75/prescription)

22
Partial Low Income Subsidy who qualifies
23
Federal Poverty Levels 2005 (Some income may be
disregarded so beneficiary should apply even if
income over limit)
24
Ohio Medicare Beneficiaries with a Medicaid
Spenddown

• If an individual with Medicare meets his/her
  monthly Spenddown any time between August 2005
  and November 2005, he/he will be automatically
  deemed eligible for the Medicare RX benefit and
  LIS (extra help) for the calendar year 2006.
• After January 1, 2006, Medicare beneficiaries who
  meet spenddown will be deemed eligible the month
  after they meet spenddown and for the rest of the
  calendar year.
• To qualify for Medicaid benefits, they still need
  to meet spenddown each month.

25
LIS Determination

• If married, the income and assets of the
• applicant and spouse living in the same
• household will be counted, regardless of
• whether the spouse applies for subsidy.
• If applying through SSA, applicants do not have
  to provide income and assets back-up
  documentation.
• SSA will verify information using automated
  systems.
• SSA will follow up with the applicant if form is
  incomplete or if discrepancies with electronic
  data matches exist.

Slide from Access to Benefits Coalition
National, April 2005
26
LIS Determination (continued)

• Income determinations based on sources of earned
  and
• unearned income.
• Earned Wages (gross), net earnings from
  self-employment
• Unearned Social Security and Veterans benefits,
  Railroad Retirement income, workers
  compensation, unemployment insurance, pensions,
  annuities, rent payments received, death
  benefits, alimony/support payments, in-kind
  support and maintenance

Slide from Access to Benefits Coalition
National April 2005
27
LIS Determination (continued) Everyone should
apply who needs help!

• Some earned and unearned income is excluded from
  income determination.
• Excluded earned income
• Up to 65 per month and one-half of remaining
  earned income,
• Up to 10 per month of infrequent earned income
• A portion of income for people with
  impairment-related work expenses not reimbursable
  by the employer
• Excluded unearned income up to 20 per month of
  unearned income up to 20 per month of irregular
  or infrequent income deductions from rental
  payments for costs associated with maintaining
  rental property deductions from death benefits
  for costs of last illness expenses
• When in doubt, APPLY!

Slide from Access to Benefits Coalition
National April 2005 (amended)
28
LIS Determination (continued)

• Countable assets generally include liquid
  resources that can readily be converted to cash
  within 20 days
• bank accounts, stocks, bonds, savings bonds and
  mutual funds, retirement accounts, cash, cash
  value of life insurance policies, equity value of
  real estate other than someones primary home
• Some resources are excluded from the asset
  determination.
• A beneficiarys home (their primary place of
  residence)
• Up to 1,500 value of cash value of life
  insurance policy for each individual that owns
  one
• Value of burial spaces owned/held for beneficiary
  and spouse
• Up to 1,500 for the beneficiary (and 1,500 for
  spouse) if these funds have been set aside for
  burial expenses
• An automobile

Slide from Access to Benefits Coalition
National April 2005
29
LIS and Other Federal Programs

• If the beneficiary gets food stamps or housing
  assistance, and his/her countable income has been
  reduced because of spending money on prescription
  drugs, the food stamps or housing assistance
  could be reduced when the insued no longer spends
  as much on prescriptions.

30
Does everyone who wants a Low Income Subsidy have
to fill out an application?

• NOthe following people are automatically
  eligible (deemed eligible)
• Medicaid recipients
• SSI recipients
• Recipients of the Medicare Savings Program (QMB,
  SLMB, QI-1)
• They should have received a notice that they do
  not have to apply for LIS.

31
How Does One Get This Low Income Subsidy?

• Letter with application being mailed to
• beneficiaries from Social Security during
  May
• through August 2005
• Fill Out Application
• Mail to Social Security Office
• Can also take to County Dept of Job and Family
  Services (not recommended)
• STARTING JULY 1, 2005, PEOPLE CAN ENROLL ON-LINE
  by going to the ABC Coalition website!
  www.accesstobenefits.org

32
Does everyone who wants a Low Income Subsidy have
to fill out an application?

• NOthe following people are automatically
  eligible (deemed eligible)
• Medicaid recipients
• SSI recipients
• Recipients of the Medicare Savings Program (QMB,
  SLMB, QI-1)
• They should have received a notice that they do
  not have to apply for LIS.

33
How Does One Get This Low Income Subsidy?

• Letter with application being mailed to
• beneficiaries from Social Security during
  May
• through August 2005
• Fill Out Application
• Mail to Social Security Office
• Can also take to County Dept of Job and Family
  Services (not recommended)
• STARTING JULY 1, 2005, PEOPLE CAN ENROLL ON-LINE
  by going to the ABC Coalition website!
  www.accesstobenefits.org

34
Things to Remember When Filling Out an Application

• Use BLACK ink or 2 pencil.
• Keep numbers, letters and Xs inside the boxes.
• Fold only once, horizontally.
• Do not download from the internet or use a copy
  of an application use application sent from the
  Social Security Administration.
• Or apply online to SSA reached from
  www.benefitscheckuprx.com

35
Enrolling in a Medicare Prescription Drug Plan
36
Ive been determined eligible for the LIS am I
finished?

• NO you still must enroll in a PDP

37
Enrolling in a Prescription Drug Plan (PDP)

• Choice between
• Original (fee-for-service) Medicare, with access
  to prescription drug plans (PDPs)
• Medicare Advantage plans (MA-PDs) offering
  medical benefits and prescription coverage
• Change plans once/year during open enrollment
  (November 15-December 31) except for dual
  eligibles
• In Ohio, plans will be announced on or after
  October 15.

Slide from Access to Benefits Coalition--
National March 2005, modified
38
Enrolling in a Prescription Drug Plan (PDP)
(continued)

• Watch for mail from Medicare
• beneficiaries will get the new
• Medicare Handbook with information
• about how to enroll.
• When October 2005

39
Timeline
40
Time Line

• SSA begins mailing LIS applications to
• 20 million recipients across U.S. v
  May 27, 2005
• Letter to those deemed
• eligible explaining they still
• need to enroll in a PDP in the fall v
  May 31, 2005
• LIS can be filed on internet v July
  1, 2005
• PDP information will be released.
  October 15, 2005
• Medicare beneficiaries will get a
• handbook from Medicare with
• enrollment Information October 2005

41
Time Line (continued)

• Beneficiaries must choose their PDPs Nov 15,
  2005 May 15, 2006
• Prescription Drug Benefit begins
  January 1, 2006
• Automatic Enrollment for those who
• receive Medicaid By January
  1, 2006
• Facilitated Enrollment (like automatic
• enrollment) for those who get LIS,
• but are not on Medicaid May, 2006
• Deadline to enroll in PDP without
• being assessed a 1 per month penalty
• when one does enroll May 15, 2006

42
Getting the Word Out Seniors need 1-on-1
help. Everyone needs to be involved!
43
Access to Benefits Coalition-- National

• Holding multiple phone conference training
  sessions for their member coalitions Contact
  barbara.shaheed_at_ncoa.org
• Supporting software tool benefitscheckup.org
• Funding 56 coalitions throughout the U.S. to do
  outreach
• Web site www.accesstobenefits.org

44
Access to Benefits Coalition--Ohio

• Funded Partners serving 35 counties
• Toll free number 1-800-648-1176
• serving entire state (housed at Ohio Assn
• of Second Harvest Food BanksColumbus)
• Staff trained to use benefitscheckup.org
  software
• to do over-the-phone enrollment
• Over fifty e-mail partners, monthly coalition
  meetings and
• statewide phone conferences where
• current information is distributed

45
Social Security Administration

• Giving presentations at locations frequented by
  potential eligibles.
• Distributing applications
• Providing educational materials Go to
• www.socialsecurity.gov, click on Medicare
  Outreach
• Tool to assess likely eligibility
• https//s044a90.ssa.gov/apps6a/i1020/main.ht
  ml
• (can be reached from Medicare Outreach
  link)
• John E LaMotte
• Staff Assistant
• 200 North High Street
• Columbus, Ohio 43215
• John.LaMotte_at_ssa.gov

46
Ohio Senior Health Insurance Information Program
(OSHIIP)

• Training over 1,000 volunteers to
• assist with limited-income subsidy
  applications
• and PDP enrollment
• Preparing a Prescription Drug Fair October 20th
• at OSU Fawcett Center, after PDPs have
• been announced (half day).
• Printed materials
• Toll free number 1-800- 686-1578
• Web site http//www.ohioinsurance.gov/ (click on
• Consumer Services)
• For October 20th event information contact Becky
  Sells
• becky.sells_at_ins.state.oh.us

47
Ohio Department of Job and Family Services

• Letters to Medicaid Dual Eligibles and people on
  Spend-Down
• Accepting LIS applications better to send to
  SSA.

48
Ohio Department of Aging

• Providing assistance to the aging network
• Using Connection Newsletter (6,000)
• Age TV
• Field staff assisting Medicare beneficiaries at
  libraries around the state
• Web site www.goldenbuckeye.com
• Contact [phone]

49
Aging Network

• Area Agencies on Aging work closely with OSHIIP
  and ODA on Medicare issues.
• Area Agency on Aging staff will direct older
  adults to long-term care services and other
  resources in the local community.
• Website www.ohioaging.org
• Local Area Agencies on Aging are active members
  of the Access to Benefits Coalitions in Cleveland
  and Toledo.

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Medicare-Approved Prescription Discount
Card With a Credit
51
Qualifications

• Receiving Medicare
• Income no higher than 135 of FPL
• No prescription drug coverage

52
What you get
Discount Card continues until December 31, 2005
when new Prescription Drug Benefit kicks in

• Credit, if you enroll after
• January 1, 2005 600
• April 1, 2005 450
• July 1, 2005 300
• October 1, 2005 150
• Wrap-Around Assistance
• Deep discounts on certain drugs, even when
• the credit is exhausted

53
Getting Help/Giving Help

• Call Access to Benefits Coalition Ohio Chapter
  1-800-648-1176
• Find out who is doing outreach in your city or
  county
• What will you do to enroll low-income Medicare
  beneficiaries in the LIS?

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Thanks for your interest. For more information
About the Access to Benefits Coalition Ohio
Chapter Contact Kathleen Gmeiner
[phone] kgmeiner_at_columbus.rr
.com For enrollment help use our toll free
number 1-800-648-1176