New Q&A on Rx Plans
By: Patricia Barry; Source: AARP Bulletin Date Posted: 2006-03-09 10:22:00-05:00
Since the AARP Bulletin published its Q&A guide to Medicare prescription drug coverage in November, readers have raised new questions about how the program works. Here are some of their queries:
Q. If I sign up for a plan, how can I be sure I'll get my meds on day one of coverage?
Signing up during the first two weeks of the month will give the plan time to process paperwork, issue your ID card and get your details into the pharmacy computer system before your coverage begins on the first day of the following month.
Q. I got muddled and signed up for the wrong plan. Can I still switch to another plan that I prefer?
You have the right to switch plans once before May 15, the enrollment deadline for getting Medicare drug coverage this year. But you cannot switch if you've already changed plans once since Jan. 1. If you haven't switched before, signing up for another plan will automatically cancel your enrollment in the previous one.
Q. What do "prior authorization," "step therapy" and "quantity limits" mean?
You may see one or more of these terms applied to drugs on a plan's formulary (its list of covered medications). They are all methods that plans use to try to keep costs down:
Prior authorization means you or your doctor must get the plan's approval before it will cover a particular drug (often a high-priced one). Your doctor generally has to show why this specific medication is necessary.
Step therapy means you must first try a generic or less expensive "preferred" drug to treat your condition to see if it works as well as the one prescribed. If it does, you (and the plan) will save money. If it doesn't, your doctor can request coverage for the original prescription.
Quantity limits does NOT mean that your supply of drugs will be cut off after a certain time or restricted to a certain number of prescriptions a year. It means that if a course of treatment calls for, say, a 30-day supply of pills (or a 90-day supply by mail order), your doctor can't write a prescription for more than that quantity without getting prior approval from the drug plan.
Q. Why does one plan charge a lot more for the same drug than another plan?
Each plan negotiates the price of each drug with its manufacturer. If a plan gets a good discount on one brand name but not on a competing drug used to treat the same condition, the plan will charge a lower copayment for the former ("preferred") drug and a higher copay for the latter ("nonpreferred").
Most plans arrange their charges in "tiers." Typically, Tier 1 is the copay for low-cost generics, Tier 2 for preferred brand names, Tier 3 for more expensive nonpreferred brand names and maybe a Tier 4 for uncommon and very expensive drugs. Since different plans may place the same drug in different tiers with charges varying as much as $30 between tiers, it is important to compare copays (as well as premiums and deductibles) when choosing a plan.
Q. If a plan doesn't cover one of my drugs, do I have to switch to an alternative drug immediately?
No. Medicare now requires plans to give new enrollees a grace period of up to 90 days, during which plans must cover existing prescriptions for drugs not on their formularies.
Q. Why don't the plans match the "norm" of the standard drug benefit designed by Congress?
Congress established a "minimum" benefit that plans had to meet or exceed. Many plans offer better deals to attract enrollees, such as lower premiums, zero deductibles and, in a few cases, coverage in the "doughnut hole."
One source of confusion is that Congress specified that enrollees would pay 25 percent of the cost of drugs in the initial coverage period (up $2,250 in total drug costs) in a year. Many plans instead charge flat copays—for example, $7, $25 and $50 in different tiers. Sometimes these are higher than 25 percent of the cost of the drugs.
Medicare officials say plans must prove that "on average" they provide the same value as the standard benefit. That average is based on the expected costs of everyone enrolled in the plan, not on individual costs. So, they say, some people will pay more and some less than the 25 percent.
Q. Can I get drugs both at a local pharmacy and by mail order under the same plan?
Yes. As long as the plan offers both options (not all do), you can have your prescriptions filled from either source—for example, using mail order for 90-day supplies of drugs you take regularly, and the pharmacy for short-term drugs such as antibiotics.
Q. I'm still working and have health and drug insurance from my employer. Should I sign up for a Medicare drug plan?
It depends whether your drug coverage is "creditable"—that is, at least as good as Medicare's. (Check with your employer's plan.) If it is, there's no need to sign up, and you won't incur a late penalty if in the future you need Medicare drug coverage. If it isn't creditable, consider enrolling in a Medicare plan now to get better coverage and avoid a late penalty.
But be careful. Dropping your employer's drug coverage (even if it is not creditable) may also mean giving up your medical benefits. In that case, you might want to keep both but enroll in a Medicare drug plan, too. This would add to your costs, but you would avoid a late penalty for Medicare coverage if you or your employer terminates your current benefits in the future.
Q. I get my drugs from the VA. Can I sign up with a Medicare drug plan, too?
Yes. Drug coverage under the Veterans Affairs health program is regarded as "creditable," but veterans are allowed to enroll in a Medicare drug plan as well, without risk of losing their VA medical or drug coverage.
Q. Can I still get some of my drugs from manufacturers' assistance programs when I'm in a Medicare plan?
There are no rules that prevent you receiving free or low-cost medicines from patient assistance programs run by drug companies while enrolled in a Medicare plan. It depends on whether the companies continue these programs for Medicare beneficiaries. Some are not.
Some companies are proposing a new program to help low-income beneficiaries pay for drugs in the doughnut hole, but the plan would begin only if federal authorities decide it does not violate anti-kickback laws.
Q. I was turned down for Extra Help because my income was a little too high. Is there anything I can do?
You could reapply. The income limits for Extra Help (the part of the Medicare drug program that gives substantial assistance to people with low incomes) were recently raised when new federal poverty guidelines for 2006 were issued. The income limits are now $1,225 a month for a single person or $1,650 for a married couple living together.
To reapply (or apply for the first time) call (800) 772-1213 or go to www.socialsecurity.gov. [For more details, see "New 'Extra Help' Income Limits."]
Q. I paid full price at the pharmacy because my enrollment in a Medicare drug plan wasn't recorded in the system. Can I get a refund?
Yes. Save your receipt and contact your plan about the refund process. (If you've lost the receipt, your pharmacist can probably provide a duplicate.)
Q. A Medicare drug plan gave me wrong information in an attempt to sign me up. Who can I complain to?
In a complex program some incorrect information is inevitable. But reports of questionable practices by some drug plans are beginning to emerge. You can complain to Medicare at (800) 633-4227 or to the Inspector General's Office of the Department of Health and Human Services at (800) 447-8477 or hhsti ps@oig.hhs.gov.
Additional Related Links
New "Extra Help" Income Limits (February 2006)
The New Math (January 2006)
Savings Are in the Details (December 2005)
A Better Bargain Than Expected (November 2005)
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