ROLLING PLAINS RAMBLINGS
# 37 –
6 Oct 05
Medicare Prescription Druga
By Morton Scott
If you are on Medicare, you probably started getting lots of mail this week.
The process leading to the Medicare Prescriptions program, called Plan D,
has begun. Plan D is confusing. I hope I can simplify it a bit for you.
COSTS – Plan D will cost $32 a month ($384 a year). Each spouse
will need to enroll separately.
WARNING # 1 – Some in Congress favor postponing the prescription
drug program for at least a year to help defray our skyrocketing national
debt and deficits worsened by the Iraqi War and Katrina/Rita recovery
costs.
WARNING # 2 – This prescription program is complicated. Be careful.
I’m trying to help with this column.
WARNING # 3 – If you have a Medicare parent please talk with them
about the choice they make.
IF YOU HAVE MEDIGAP PRESCRIPTION COVERAGE – Your probably can forget
all this. Keep what you have. BUT, if your company eliminates the coverage
you must, make your switch quickly. Penalties are high for delays in signing
up. Your insurance provider will notify you whether or not your current
prescription coverage will continue.
FORMULARIES – This might be a confusing word for many. Don’t
let it confuse you. “Formularies” just means a list of prescription
drugs a company will help pay for. Think of it as "List of Medications
Covered.”
IMPORTANT DATES:
OCTOBER 1: This was the date companies could first send out information
about the plans they will offer. That’s why you’re getting mail
this week. Medicare will also send you a booklet outlining the prescription
plan; look for this in the mail. If you don’t get it soon, contact
the Social Security office.
NOVEMBER 15: The first date you can enroll for your choice of Plan D programs.
You actually have until May 15, 2006 to make the choice. After that, if
you delay making the decision, you will be penalized one percent a month
permanently for each month of delay. Thus, if you wait 12 months, you will
be penalized 12% of the Plan D fee the rest of your life,. The penalty would
be $76.80 each year, the rest of your life.
JANUARY 1, 2006 – If you enrolled before December 31, this is the
day your plan will become effective. Your savings on prescriptions begin.
MAY 15, 2006 – As indicated above, you MUST make the decision prior
to this date. If you delay, the penalties will start.
YOUR COSTS AND SAVINGS
The following lists the prescription purchase range and what you pay:
RANGE: $0-$250 – You pay all of first $250 as a deductible.
RANGE: $251-$2,250 – You pay 25% and Medicare pays 75%. If you have
at least $2,250 in prescription expenses, you would pay $500 and Medicare
pays $1,500. Thus, you would pay $750 for $2,250 in prescription costs.
RANGE $2,251-$5,100 – You pay 100% of drug costs, until the $5,100
level total prescription cost is reached. You will have then paid $3,600
of the first $5,100 of drug costs.
OVER $5,100 - You pay 5% with no upper limit. This catastrophic coverage
enables you to pay $2 for generic drug prescriptions and $5 for brand
name prescriptions, or 5% of the total, whichever is greater.
These categories will increase in future years.
Special provisions are made for low-income persons. There are many other
provisions which I will not cover today. Plan D companies can offer other
variations, meeting standards set by Medicare. There are many other aspects
of the new drug prescription program. Like I said in the beginning, this
is a very complex program. Much more complex than I think it should be.
I have not yet covered the Formularies, or drug lists. This will come
next week in Rolling Plains Ramblings.
Contact me at fmortonscot at aol.com
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