WHAT YOU NEED TO KNOW ABOUT MEDICARE PART D

1. WHAT YOU NEED TO KNOW ABOUT MEDICARE PART D Pharmacy Outreach Program The University of Rhode Island College of Pharmacy Updated October 2013

2. MEDICARE • Medicare provides health insurance for… • Aged 65 years or older • Aged 65 years or less with certain disabilities • All people with End-Stage Renal Disease (ESRD) • All people with Lou Gehrig’s Disease (ALS)

3. THE PARTS OF MEDICARE • Part A • Hospital insurance • Part B • Medical insurance • Part C • Medicare Advantage Plans • Part D • Prescription drug coverage

4. Medicare Part A • Covers: • Inpatient hospital care • Skilled nursing facilities (Under certain conditions) • Usually doesn’t require a monthly payment (Premium) • Out-of-pocket deductible for hospital stays (in 2012): • Days 1–60: $1,184 deductible • Days 61–90: $296 coinsurance per day • Days 91-150: $592 coinsurance per day • Beyond day 151: patient pays all costs. • For skilled nursing facilities: • $144.50 per day for days 21 through 100 for each benefit period

5. Medicare Part B • Helps cover: • Physician services • Durable medical equipment • Physical therapists • Also covers other services and supplies: • Glucose monitors • Test strips • Lancets • Vaccines • There is a monthly premium to enroll • The standard Part B premium for 2013 is $104.90 per month (income based) • In general, automatically deducted from social security checks • The Part B deductible is $147 • Once deductible is paid enrollee generally pays a 20% co-payment for each service

6. Medicare Advantage (Part C) • Health insurance coverage, including preventative care PLUS prescription drug coverage in a single plan • In exchange, typically must use a certain network of doctors, hospitals, and pharmacies (HMO, PPO)

7. Medicare Advantage • 6 plans available in Rhode Island with drug coverage • 2 more plans without drug coverage • If you already have a Medicare Advantage plan and you want to add drug coverage you MUST obtain it through your Medicare Advantage provider if they offer it. • If you obtain an independent standalone drug plan instead, your health coverage under the Medicare Advantage plan will stop and you will return to Original Medicare.

8. Medicare Advantage • Annual Enrollment Period in 2013 • October 15-December 7, 2013 • Can choose to leave current Medicare Advantage plan to switch to an Original Medicare plan • Can add prescription coverage - Part D

9. MEDICARE PART D • Stand-alone prescription drug coverage • Open to all people eligible for Medicare • Open enrollment begins October 15, 2013 • Enrollment for coverage of the year 2014 ends on December 7, 2013 • Coverage Begins on January 1st, 2014 • Medicare Part D is VOLUNTARY!!

10. When Can I Enroll in a Part D Plan? • Re-enrollment begins October 15th, 2013! • Your new plan will take effect January 1st, 2014 • If you are happy with your current part D plan, you don’t need to do anything during the re-enrollment period! • Your Med D plan will automatically re-enroll you • But be aware:your premiums, co-pays, formulary, or deductible may be changed for the new year!

11. Enrollment Info • NEW Open enrollment is from Oct 15 – Dec 7th 2013 of each year • Dates just changed • Coverage begins on January 1, 2014 • If you become eligible for Medicare Part D after the enrollment period, you have a 7 month period to enroll without incurring a penalty • 3 months before, the month of and 3 months after your 65th birthday

12. Who Should Apply? • People who are enrolled in a Med D plan right now but are thinking about switching to another plan next year • You didn’t sign up for a plan when eligible last time around but you’re thinking of enrolling now • Penalty: 1% increase in premium for every month not enrolled • Enrolled in a Medicare Advantage Plan or Medigap Supplemental Insurance Plan but you want to add or change your drug coverage • People who have major changes in the medications they take on a daily basis

13. Who Does Not Need To Apply • If you have CREDITABLE Coverage: • Creditable Coverage = a plan that provides a prescription drug benefit that is EQUIVALENT or better than Medicare Part D coverage • You would have already been made aware of this by your insurance provider by mail • KEEP THIS LETTER IN A SAFE PLACE** **If you are unsure if your coverage is creditable or not, ask your employer or union for it!**

14. Penalty Info • If you did not enroll but were eligible to do so • When you enroll now for coverage beginning on Jan.1, 2014 – you will incur a penalty of a premium increase of 1% per month that you were eligible • Will have to wait until 2014 enrollment period to join a Medicare drug plan if don’t do so now! • Average premium 2014 = $31 • 1% of $31 = $0.31 • 12 months penalty= $3.74 • Therefore, $3.74 will be added on to your monthly premium every month forever!

15. Penalty Info You will not have this penalty enforced: • If you were not previously eligible for Medicare Part D • If you previously had creditable coverage

16. Part D-IRMAA (Part D income-related monthly adjustment amount) • Those with Medicare Part D that have an annual income above a certain level will have an additional fee added to their monthly premium • Penalty based on gross income reported on the income tax return from 2 years prior • Paid directly to Medicare (aka the Federal government) • It is not collected by Medicare Part D plans

17. Part D-IRMAA (Part D income-related monthly adjustment amount) • The amount of an individual’s IRMAA will be deducted from any government benefits • (e.g. Social Security) • If sufficient funds are not available, individuals will be billed directly from Medicare • Medicare Part D beneficiaries will be contacted by the Social Security Administration if they are affected by the 2014 IRMAA

19. Affordable Care Act Changes • Lower costs during “donut hole”: • Patients pay 47.5% of brand name drugs • Patients pay 72% of generic drugs • Better Quality care: • Bonus payments from the government will give incentives to Medicare Advantage plans with better quality care

20. HOW PART D WORKS • Remember: this is just an explanation of the template used as a general basis for the plans--there are options! • STANDARD PLAN (2014) • $31 per month premium • $310 deductible (some plans don’t have deductibles) • 68% coverage until you’ve paid $2,850 (copay varies by plan) • Limited coverage for the next $4,550 spent • Patient pays 47.5% of Brand Drugs and up to 72% of generic drugs • This is called the coverage gap or “Donut Hole” • 95% coverage beyond the coverage gap (% varies by plan)

21. HOW PART D WORKS Catastrophic Coverage > $7400 Medicare Pays 95% Donut hole - $2960 – $7400 5% 28%-52.5% 47.5%-72% 32% Co-Insurance : $311-2960 68% 0 - $310 is your Deductible You Pay 100% New Change for Donut hole, will only spend 47.5% out of pocket for brand name and 72% maximum for generic drugs!!!

22. Think of it as Steps! • Step #1 – The Deductible • You pay 100% and plan pays 0% • You receive $310 worth of medications • Step #2 – Co-insurance • You pay 25% and plan pays 75% • You receive $2,850 worth of medications (Total: Step 1 + Step 2 = $2960) Medicare Pays 95% 5% 28%-52.5% 47.5%-72% 32% 68% You Pay 100%

23. Think of it as Steps! • Step #3 – The Donut Hole • New changes let you pay • 47.5% of brand drugs • Max of 72% generics • You receive $4,550 worth of medications • Total: Step 1 + Step 2 + Step 3 = $7400 • New discounts! • Step #4 – Catastrophic Coverage • You pay 5% and plan pays 95% • You receive unlimited drugs for the remainder of calendar year Medicare Pays 95% 5% 28%-52.5% 47.5%-72% 32% 68% You Pay 100%

24. Remember! • Even though you were enrolled in a program last year, you start from the Step #1 all over again on January 1, 2014 • You will continue to pay the premium every month regardless of what step that you are on • Even when in the “donut hole” a person still pays the monthly premium!

25. Besides Standard Plan… • Must offer basic/standard drug benefit • May offer enhanced benefit • Some have no deductible • Some have help during “donut hole” (coverage gap) • The Premium depends on the enhancements • Mail order options may save costs on maintenance medications (90 days)

26. Explaination of Benefits • A statement sent by your insurance company telling you which medical services were paid for by them. • Includes: • The service: date/place service provided • Doctors fee and what was paid by them • Remainder that the patient is responsible for • To show you what portion the insurance is paying for and which portion you are.

27. How Do I Choose The Right Plan? Rx Enrollment Check-Up: • Cost • Will your premium and costschange in 2014? • Coverage • Will you need more comprehensive coverage? • Will your current meds be covered by your plan? • Now that donut hole is partially covered, is switching a better option? • Customer Service • Are you satisfied with your service from your current plan?

28. Side Note: • If you decide that your current Med D plan will meet your needs in 2014 then you do not need to re-enroll • Coverage will continue through 2014 starting from Step 1

29. Plans Available in RI for 2014 • Total of 28 prescription plans offered • 12 plans available with NO deductible! • 20 Plans without gap coverage • Monthly premiums start at $12.60 Humana Walmart Rx Plan • 10 Plans with gap coverage • Monthly premiums with gap coverage start at $46.90 and go up to $120.50 • Lowest premiums have only a few brands covered • All Medicare patients are eligible for a Medicare advantage plan

30. What is a Formulary? • Formulary system • Each plan selects certain drugs from each drug class that they will cover • May have a tier system • May have up to 5 tiers • Generic drugs = cheapest (ex: $5) • Preferred brand names = more expensive (ex: $28) • Non-preferred brand names = most expensive (ex: $40) • Certain injectable and specialty drugs= highest tiers (ex: $58)

31. Drugs Not Covered Under Most Part D Formularies • Non-FDA approved drugs • Weight loss or gain • Erectile dysfunction • Drugs for cosmetic purposes(hair growth) • Non prescription drugs • Cough & cold relief • Fertility drugs • Prescription vitamins, minerals • Except prenatal vitamins and fluoride preparations

32. Definitions: • Generics: required to be covered by ALL plans • Chemically identical to brand-name drugs and meet the same standards put forth by the FDA for: Safety, Purity, Effectiveness • Generic drugs can be legally produced in the US if a patent has expired, or for drugs which have never been patented • Prior authorization: may be needed for some medications • Appeal process mandated by insurance company which includes paperwork by the Doctor explaining why you need the drug • Step Therapy: may be required before certain medications will be covered • ex: Prilosec before Nexium, or Motrin before Celebrex • Quantity limits: may be enforced • 30 day quantities retail vs. 90 day mail-order • Some plans DO allow 90 day quantities of maintenance medicines at community pharmacies.

33. Frequently Asked Questions

34. Who pays for my vaccines? • Medicare part D must cover all vaccines not covered by part B • Ex: Zostavax (Shingles vaccine) • Vaccines covered by part B • Pneumococcal • Influenza • Hepatitis B • Vaccines necessary to treat a disease or prevent one after direct exposure • Ex: tetanus

35. WHAT ABOUT MY RIPAE? • You SHOULD keep your RIPAE! • It will provide assistance with the deductible & coverage gap • It is not creditable coverage • You need a Medicare Part D Plan to apply • RIPAE is only available for those enrolled in a Medicare part D plan • Must send in copy of enrollment letter or card • See your SHIP counselor or call The Point for RIPAE information

36. RIPAE… • Provides extra benefit for those who don’t qualify for extra help from Medicare • Applicable to all expenses that person is 100% responsible for: • Deductible • Coverage gap (“Donut Hole”) • Drugs not covered under your Part D Plan • Only certain ones!

37. RIPAE… • Eligible: • Single, income less than $45,991 per year • Married, income less than $52,561 per year • The lower the financial category, the higher percentage RIPAE will pay • More information: • 401-462-4444 The Point • Wrong phone number on Medicare & You 2008 Booklet! • Talk to SHIP counselor

38. What About My Tricare, VA, Pension Benefits? • They are creditable coverage, letters have been sent in mail! • Hold on to these letters! • Contact your pension benefits manager or union if you have any questions

39. Dual Eligibles(Medicare/Medicaid) • Will automatically be eligible for: • No premium • No deductible • No donut hole • Minimum co-payments ($2.55 generic & $6.35 brand at most) • Have been automatically enrolled in a plan & will be automatically re-enrolled in a plan • Part D plan for 2014 won’t necessarily be the same plan as 2013 • Reassignment notices are being sent out • Enrollment confirmations will follow • If you are “dually eligible,” you can change your plan at any time during the year! Once per month!

40. What is Extra Help? (Low Income Subsidy) • Federal poverty limits determined by government each year • Best to apply and be formally denied • Many deductions, so apply! • In order to be eligible, a person’s resources must be no greater than the limits established *Includes $1,500 per person burial expenses

41. “Deemed” Population • Defined as those who had Low Income Subsidy (LIS) for 2013 & are not automatically eligible for 2014 • Notifications being sent out with applications to re-enroll • Does not mean that you are not eligible • You need to reapply!!! • Check with your SHIP counselor or The Point

42. Ways to Lower Your Drug Costs During the Coverage Gap • Ask your doctor about generic and less expensive brand name drugs (therapeutic substitutions) • Cheaper in the gap • Less likely to hit the gap if avoid brand name medications from the beginning! • Ask your doctor for samples • Pharmaceutical Assistance Programs • Available from the pharmaceutical manufacturers • Contact the Partnership for Prescription Assistance • 1-888-477-2669

43. Ways to Lower Your Drug Costs During the Coverage Gap • State Pharmaceutical Assistance Programs • RIPAE • Based on your income, RIPAE will pay 15%, 30%, or 60% of drug cost during coverage gap • Apply for Extra Help • If you have limited income and resources, you may qualify for extra help • For more information go to www.socialsecurity.gov or call 1-800-772-1213

44. New Medicare Changes • Changes in amount covered during the Coverage Gap! • 47.5% for brand name prescriptions (↓ from 50%) • 72% for generic prescriptions (↓ from 79%) • Greater Coverage for preventive medical services • Depression • Cardiovascular Disease • Alcohol Abuse • Obesity

45. What if I Like A Plan & One of My Drugs is Not Covered? • Options: • Ask your pharmacist about therapeutic substitution • Compare prescription vs. over-the-counter (OTC) options • Nexium $158.00 • Prilosec OTC $21.99 • Omeprazole Rx- lowest cost or co-pay • Always consult with your doctor regarding changes to your medications

46. Drugs that are Not Covered by ANY Part D Plan • Can still get these drugs but must pay the retail price (“cash”) and it does not count towards out-of-pocket expenses or total drug costs Examples: • Drugs for weight loss, hair loss, and fertility • Drugs covered under Medicare parts A and B • Example: Drugs received while in the hospital, diabetic testing supplies

47. Medicare Fraud • The vast majority of your health care providers are committed to providing you with high quality care… • However, there are some individuals who cheat the system out of millions of dollars, which results in higher premiums for its members. • Be very cautious when dealing with your Medicare information, & never share it with a medical professional unless you are absolutely certain that they need it. • Never share your Medicare information over the phone with someone else! • Especially if you did not call them.

49. Using the Internet • Get a complete list of your medications • Include all prescriptions-eye drops, creams, inhalers, patches, etc. • Go to www.Medicare.gov and click on “Formulary Finder” • Follow the prompts and enter your medications • Can also call 1-800-MEDICARE (1-800-633-4227) • Can enroll on line—have your Medicare card ready • CVS and Walgreens both have websites to condense your search of possible plans • Rite Aid has plan finding software, just call your Rite Aid pharmacist and schedule a time to choose a plan

50. Important Dates to Remember October 1- Compare and Prepare October 15- Open Enrollment Begins December 7- Open Enrollment Ends January 1, 2014- Coverage Begins