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The following information regarding Medicare Prescription Drug Program is brought to you as a public service by the lawyers of the State of Oregon. The material presented is general legal information intended to alert you to possible legal problems and solutions.
The Medicare Modernization and Improvement Act of 2003 has made a number of changes in Medicare for seniors and persons with severe disabilities. The changes have generally made choosing and enrolling in Medicare plans more complicated. This tape will highlight a few of the recent changes in the law,
Among the changes is a new plan for prescription drugs that becomes available in January 2006. This plan, sometimes called Medicare Part D, joins Medicare Part A (hospitalization coverage) and Part B (medical and some kinds of outpatient coverage). Medicare Part C, also known as Medicare Plus Choice or Medicare Advantage, is managed care or HMO coverage. Some Medicare Part C policies already cover prescriptions and some do not.
Any person who already has Medicare Part A, or Medicare Part B, or Medicare Part C will be eligible for Part D prescription coverage. To get prescription coverage, most eligible people will have to apply for it. Although people can apply through their Social Security office for Part A and B coverage, they must apply for prescription coverage directly from an insurance company that offers the coverage. For most people who will already have Medicare Part A, B, or C, by November 2005, the first time to apply for prescription coverage is November 15, 2005. The last date for these people to apply without having to pay a penalty for late enrollment is May 15, 2006. After May 15, these people cannot obtain prescription coverage until January 2007.
Medicare recipients who apply by December 31, 2005 will qualify for prescription coverage beginning January 1, 2006. Coverage for those who apply later will begin on the first day of the month after the month they apply. After May 15, 2006, people who are already Medicare recipients must pay a penalty that will be added to their premiums every month. The penalty goes up every month they delay—even though they cannot enroll after May 15 until the following January, when there is what is called an “open enrollment period”.
Some people may have prescription coverage through employer-sponsored or union-sponsored health insurance, or through the Veterans Administration. If their coverage under these policies is at least as good as that available through a Medicare prescription plan, they do not have to change their plans to Medicare. Nor will they have to pay a monthly penalty if they decide to change to Medicare later on. This exception to the general rule is limited, however. For example, the exception applies only to a worker, but not to the spouse of the worker who is covered by an employer or union plan. The plan administrator of these insurance programs should notify the policyholder whether the coverage is “at least as good as” the Medicare alternative. People who are uncertain about the scope of their employer or union sponsored coverage should contact the plan administrator right away. Mistaken reliance on other coverage can result in costly late enrollment in Medicare prescription coverage later on.
Limited-income people with Medicare may have prescription coverage through Medicaid, known in Oregon as the Oregon Health Plan. People who get Supplemental Security Income, or SSI, also get their prescriptions covered by Medicaid. After 2005, those individuals will no longer have prescription coverage except through Medicare. Medicare prescription coverage requires payment of premiums, deductibles, and copayments that low-income people cannot afford. These people should have been notified in June 2005 that they will receive what the government calls “extra help”, so they will not have to pay these costs. Persons who receive Medicaid benefits who were not notified of this subsidy should contact their local Area Agency on Aging office or Seniors & People with Disabilities office. Getting this extra help does not enroll a person in a prescription drug plan, however. It simply helps pay for the coverage, which the person still must choose and apply for.
Other people with limited incomes may not be receiving Medicaid prescription coverage. They too will have difficulty paying Medicare prescription deductibles, premiums, and copayments. Extra help is available for many of these people, too, although for them it is not automatic--they must apply for it. The application form is available from Social Security offices and from the Social Security website. Generally speaking, an individual whose countable yearly income is less than $14,355 or a couple whose countable income is below $19,245 and whose savings are limited should qualify for this subsidy. The law lists a number of exceptions for what is “countable” income. A person whose application is denied should seek legal advice about whether the law was applied correctly in a particular case. The denial notice will give the person information about the deadline to appeal. Getting legal advice right away is important for those who cannot pay the cost of coverage for needed medicines.
Several insurance companies will offer prescription drug plans in Oregon. People should be aware that the federal government has given companies permission to call them and visit them to try to sell them insurance. Crooks will take advantage of this opportunity to defraud seniors. Some sales people will use high pressure tactics to force people to buy their coverage. People should take their time looking at policies and get help evaluating their needs before purchasing coverage. They can get trained help free from Oregon’s Senior Health Insurance Benefits Assistance program, or SHIBA, at 800 722 4134.
Some people will find that the new prescription plans do not offer to cover the medicines they need. Or the plan the person chooses will stop covering a drug someone needs. In some cases, it is possible to be an “exception” that will allow coverage. SHIBA, social services staff, doctors, and some lawyers may be able to help get an exception. A wrongful denial of coverage for needed medications—or for that matter, needed medical care--may also be grounds for an appeal. A large portion of Medicare claims that are denied are denied in error. Although the SHIBA program can assist people with preliminary parts of appeals, it is important to get legal assistance for help beyond that stage.
This information is from the Oregon State Bar's Tel-law service, a collection of recorded legal information messages prepared by the lawyers of Oregon. In addition to being online, the Tel-law service is accessible by telephone at 503-620-3000 or toll-free in Oregon only, 1-800-452-4776. A touch tone phone allows direct access 24 hours a day, 7 days a week. To receive a free Tel-law brochure listing the subjects available call 503-620-0222, ext. 0.