What is Medicare prescription drug coverage?
Medicare prescription drug coverage is insurance that covers both brand-name
and generic prescription drugs at participating pharmacies in your area.
Medicare prescription drug coverage provides protection for people who have
very high drug costs.
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Who can get Medicare prescription drug coverage?
Everyone with Medicare is eligible for this coverage, regardless of income
and resources, health status, or current prescription expenses.
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When can I get Medicare prescription drug coverage?
You may sign up from November 15, 2005 to May 15, 2006. If you join by December
31, 2005, your coverage will start January 1, 2006, and you won't miss a
day of coverage. If you don't sign up when you are first eligible or by
May 15, 2006, you may pay a penalty. Your next opportunity to enroll is
from November 15, 2006 to December 31, 2006.
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How does Medicare prescription drug coverage work?
Your decision about Medicare prescription drug coverage depends on the kind
of health care coverage you have now. There are two ways to get Medicare
prescription drug coverage. You can join a Medicare prescription drug plan
or you can join a Medicare Advantage Plan or other Medicare Health Plans
that offer drug coverage. Whatever plan you choose, Medicare drug coverage will help you by covering
brand-name and generic drugs at pharmacies that are convenient for you.
Like other insurance, if you join, you will pay a monthly premium, which
varies by plan, and a yearly deductible (no more than $250 in 2006).
You will also pay a part of the cost of your prescriptions, including
a co-payment
or coinsurance. Costs will vary depending on which drug plan you choose.
Some plans may offer more coverage and additional drugs for a higher
monthly premium. If you have limited income and resources, and you
qualify for
extra help, you may not have to pay a premium or deductible. You can
apply or get more information about the extra help by calling Social
Security at 1-800-772-1213 (TTY 1-800-325-0778) or visiting www.socialsecurity.gov.
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Why should I get Medicare prescription drug coverage?
Medicare prescription drug coverage provides greater peace of mind by protecting
you from unexpected drug expenses. Even if you don't use a lot of prescription
drugs now, you should still consider joining. As we age, most people need
prescription drugs to stay healthy. For most people, joining now means
protecting yourself from unexpected prescription drug bills in the future.
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What if I have a limited income and resources?
There is extra help for people with limited income and resources. Almost
1 in 3 people with Medicare will qualify for extra help and Medicare will
pay for almost all of their prescription drug costs. You can apply or get
more information about the extra help by calling Social Security at 1-800-772-1213
(TTY 1-800-325-0778) or visiting www.socialsecurity.gov.
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Cost
Premium
This is the monthly cost you pay to join a Medicare drug plan. Premiums
vary by plan.
Deductible
This is the amount you pay for your prescriptions before your plan starts
to share in the costs. Deductibles vary by plans. No plan may have a deductible
more than $250 in 2006.
Co-payment/Coinsurance
This is the amount you pay for your prescriptions after you have paid
the deductible. In some plans, you pay the same co-payment (a set amount)
or coinsurance (a percentage of the cost) for any prescription. In other
plans, there might be different levels or "tiers," with different
costs. (For example, you might have to pay less for generic drugs than
brand names. Or, some brand names might have a lower co-payment than
other brand
names.) Also, in some plans your share of the cost can increase when
your prescription drug costs reach a certain limit.
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Coverage
Formulary
A list of drugs that a Medicare drug plan covers is called a formulary. Formularies
include generic drugs and brand-name drugs. Most prescription drugs used
by people with Medicare will be on a plan's formulary. The formulary must
include at least two drugs in categories and classes of most commonly prescribed
drugs to people with Medicare. This makes sure that people with different
medical conditions can get the treatment they need.
Prior Authorization
Some drugs are more expensive than others even though some less expensive
drugs work just as well. Other drugs may have more side effects, or have
restrictions on how long they can be taken. To be sure certain drugs are
used correctly and only when truly necessary, plans may require a "prior
authorization." This means before the plan will cover these prescriptions,
your doctor must first contact the plan and show there is a medically-necessary
reason why you must use that particular drug for it to be covered. Plans
might have other rules like this to ensure that your drug use is effective.
Coverage Gap
If you have high drug costs, you may consider which plans offer additional
coverage until you spend $3,600 out-of-pocket. In some plans, if your costs
reach an initial coverage limit, then you pay 100% of your prescription costs.
This is called the coverage gap. This "gap" in coverage is generally
above $2,250 in total drug costs until you spend $3,600 out-of-pocket. Some
plans might offer some coverage during the gap. Even in plans where you pay
100% of covered drug costs after a certain limit, you would still pay less
for your prescriptions than you would without this drug coverage.
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Convenience
Drug plans must contract with pharmacies in your area. Check with the plan
to make sure your pharmacy or a pharmacy in the plan is convenient to you.
Also, some plans may offer a mail-order program that will allow you to have
drugs sent directly to your home. You should consider all of your options
in determining what is the most cost-effective and convenient way to have
your prescriptions filled.
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Peace of Mind Now and in the Future
Even if you don't take a lot of prescription drugs now, you still should
consider joining a drug plan in 2006. As we age, most people need prescription
drugs to stay healthy. For most people, joining now means you will pay a
lower monthly premium in the future since you may have to pay a penalty if
you choose to join later. You will have to pay this penalty as long as you
have a Medicare drug plan. If you reach the point where you have spent $3,600
out-of-pocket for drug costs during the year, the plan will pay most of your
remaining drug costs. This protection could start even sooner in some plans.
For more information about the Medicare Prescription
Drug Coverage call 1-800-MEDICARE (1-800-633-4227),
TTY: 1-877-486-2048 (24 hours a day, 7 days a week).
Or
visit them online at: http://www.medicare.gov
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