*** The Health Care Programs Manual (HCPM) has been replaced by the Minnesota Health Care Programs Eligibility Policy Manual (EPM) as of June 1, 2016. Please refer to the EPM for current health care program policy information. ***
Effective: June 1, 2011 |
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04.40.20 - Medicare Part D |
Archived: June 1, 2016 (Previous Versions) |
Medicare Prescription Drug Coverage (Medicare Part D) was enacted into law in 2003 as part of the Medicare Prescription Drug, Improvement and Modernization Act of 2003.
The program began in January 2006 and is available to people entitled to premium-free Medicare Part A or enrolled in Medicare Part B. Enrollment in Medicare Part D is voluntary, but premium penalties apply for late enrollment by people without other drug coverage. People have a wide variety of Medicare-approved plans from which to choose.
This section provides an overview of Medicare Part D in relation to eligibility for Medical Assistance (MA) and Medicare Savings Programs (MSP). For more information about Medicare Part D, see the Medicare Web site.
Automatic Eligibility for Extra Help.
Extra Help and Medicare Savings Programs.
Temporary Prescription Drug Coverage for Full Benefit Dual Eligibles.
To receive Medicare Part D coverage, a Medicare beneficiary must be enrolled in a Medicare prescription drug plan or a Medicare Advantage plan that includes prescription drug coverage. Beneficiaries enroll in a Medicare Part D plan by directly contacting the plan.
Medicare beneficiaries may choose to enroll in a Part D plan during
l Their initial enrollment period.
l The annual election period.
l A special enrollment period.
Coverage under the new plan begins in January the following year for people who change plans during the annual election period. See Medicare for more information about these enrollment periods.
Note: Full-Benefit Dual Eligibles may choose to switch Medicare Part D plans at any time, and do not have to wait for the annual election period or meet criteria for special enrollment.
Medicare beneficiaries may choose not to enroll in a Part D plan. However, people who choose not to participate in Medicare Part D, and do not have other creditable drug coverage, may be charged a higher Part D premium if they ever choose to enroll in a Part D plan after the initial enrollment period.
People with creditable drug coverage will not have to pay a higher premium if they later enroll in a Medicare Part D plan. People with current other health care coverage that includes drug coverage may have several options depending on whether their other coverage is creditable or not. Encourage people who have other drug coverage to contact the benefit administrator of their insurance plan to discuss their options.
The specific drugs covered under Medicare Part D can vary depending on the drug coverage plan chosen. Plans can cover generic and brand-name drugs.
Note: See Medicare for web sites and phone numbers a person may contact for help with Medicare Part D. Refer people who have questions about covered drugs or who are having problems getting the drugs they need through their Part D plan to these Medicare contacts.
Premiums and Other Cost-Sharing
Most people will be responsible for cost-sharing including:
l A monthly premium.
The cost of the premium varies with the drug plan chosen and the person’s financial situation.
People who decide not to enroll in a Medicare Part D drug plan when they are first eligible and do not have other creditable drug coverage, may pay a higher premium for Medicare Part D coverage if they choose to enroll after their initial enrollment period.
People can choose to pay their Part D premiums:
n With a deduction from their Social Security or Railroad Retirement check.
n By paying the plan directly.
n With an automatic withdrawal from a bank account.
l An annual deductible.
l Coinsurance.
l A coverage gap. A coverage gap is a period when the client is responsible for 100% of the drug costs. This coverage gap begins when a set amount of drug costs have been paid by Part D.
Note: Coverage gap is also referred to as ”doughnut hole.”
For a breakdown of cost-sharing expenses for standard benefits under Medicare Part D, see Medicare Cost-Sharing Amounts.
Some Medicare beneficiaries who have limited income and assets are eligible for premium and cost-sharing subsidies. These subsidies are referred to as Extra Help or Low-Income Subsidy (LIS). There are two types of Extra Help:
l Partial subsidy.
l Full subsidy.
Some people are automatically qualified for Extra Help, while others must complete and submit a formal application to SSA.
Automatic Eligibility for Extra Help
The following people are eligible for the full Extra Help subsidy automatically regardless of their income and assets:
l Full-Benefit Dual Eligibles.
People who are enrolled in both federally funded MA and Medicare. People gain full-benefit dual eligible status in the first month they are enrolled in both Medicare and federally funded MA, with or without a spenddown. Full benefit dual eligibles automatically qualify for Extra Help through the rest of the calendar year.
n This includes MSHO and MA-EPD enrollees.
n MA enrollees with a spenddown must be covered by MA at least one day in the month. The enrollee must meet the spenddown amount in the month in order to be considered full-benefit dual eligible for that month.
l Medicare Savings Program (MSP) enrollees.
l Supplemental Security Income (SSI) recipients who have Medicare.
To identify enrollees automatically eligible for the full Extra Help subsidy, DHS sends a data file to the Centers for Medicare and Medicaid Services (CMS) three times per month.
l The data file identifies all federally funded MA and MSP enrollees who have Medicare data in MMIS. The data file identifies MA and MSP enrollees for the current month, and MA and MSP enrollees who have been approved for retroactive coverage.
The Social Security Administration (SSA) also sends a data file to CMS identifying SSI recipients with Medicare who qualify for the full Extra help subsidy.
CMS deems the enrollees as qualified for Extra Help. CMS also identifies people enrolled in MA or an MSP who are not yet enrolled in a Medicare Part D plan. CMS randomly and automatically enrolls these people in a benchmark Medicare Part D plan.
l CMS contacts the Medicare Part D plan, so the plan will collect the correct cost-sharing amount from the enrollee.
l The Extra Help subsidy begins the first month in which the enrollee has concurrent Medicare Part D coverage and federally funded MA or MSP coverage. This includes retroactive months.
Note: The Medicare Part D plan is responsible for providing refunds for monthly premiums and other cost-sharing expenses to enrollees who qualify for the Extra Help subsidy retroactively.
l Once a person is deemed eligible for the full Extra Help subsidy, their eligibility for the subsidy will continue for the remainder of the calendar year, regardless of changes in MA, MSP or SSI eligibility.
l CMS starts the deeming process over each July to identify people who will continue to be deemed eligible for the Extra Help subsidy for the following calendar year.
n Enrollees who appear on the DHS data file as full benefit dual eligibles or MSP enrollees in July or August are automatically deemed eligible for the Extra Help subsidy for the following calendar year. They will not receive a notice from CMS unless the level of their cost-sharing changes.
Example:
George is a Medicare beneficiary enrolled in MA. George appears as a full benefit dual eligible on one of the data files DHS sent to CMS in July 2008.
CMS deems George eligible for the Extra Help subsidy for the calendar year beginning January 1, 2009. He will not get a notice from CMS about the Extra Help subsidy, unless there is a change in his Medicare Part D cost-sharing. George will be eligible for the Extra Help for all of 2009, regardless of changes in his MA eligibility.
n Enrollees who do not appear on a DHS data file as MA or MSP enrollees in July or August will receive a notice from CMS that their Extra Help subsidy eligibility is ending at the end of the current year. CMS encloses an Extra Help application with the notice.
n Enrollees who do not appear on the DHS data file in July or August, but reappear on a subsequent data file (September - December) are deemed eligible for the subsidy for the following calendar year. They will get two notices from CMS:
m The first notice will say that their subsidy eligibility is ending, based on their absence from the July and August data files.
m The second notice will say they are eligible for the subsidy. This notice will be issued after they reappear on a subsequent monthly data file as a full benefit dual eligible.
Example:
Sari is a Medicare beneficiary enrolled in MA. Her MA is closed effective June 1 for failure to submit a renewal. Because she no longer has MA, Sari does not appear on the DHS data files to CMS in either July or August.
Sari gets a notice from CMS that says her eligibility for the Extra Help subsidy is ending on December 31.
Sari reapplies for MA, and eligibility is approved in September. She is once again a full benefit dual eligible. Sari appears on a DHS data file sent to CMS in September.
Sari receives a second notice from CMS that says she is deemed eligible for the Extra Help subsidy for the next calendar year.
n People who appear for the first time on a data file as full benefit dual eligibles or MSP enrollees between July and December (of any year) are deemed eligible for the Extra Help subsidy beginning with the earliest month of MA or MSP eligibility through December of the following calendar year. They will get a notice from CMS about their Extra Help subsidy eligibility.
n Medicare beneficiaries whose MA or MSP eligibility is closed prior to July 1 and who do not re-enroll or re-qualify by the end of the current year must submit a formal application to SSA to be eligible for the Extra Help subsidy for the following year. They should complete and submit to SSA the Extra Help application they get with the Extra Help ending notice.
People who are not automatically eligible for Extra Help may complete and submit an application to SSA. People who apply for Extra Help must be within certain income and asset limits to qualify for a subsidy.
Medicare beneficiaries of all ages can get free assistance with completing an application for Extra Help by calling the Senior LinkAge Line® at (800) 333-2433.
Certified health insurance counselors are available to help people with:
l Information about Medicare Part D and the Extra Help available;
l completing an application for Extra Help; and
l choosing a Medicare prescription drug plan.
Medicare beneficiaries can also get help with the application by calling SSA at (800) 772-1213 or (800) 325-0778 or visiting the SSA Web site.
People who apply and are approved for Extra Help by SSA are eligible for a special enrollment period to enroll in a Medicare Part D plan.
l CMS will automatically enroll people in a Part D plan if they have been approved by SSA for Extra Help and have not enrolled in a Part D plan. Enrollment in a benchmark Medicare Part D plan will take place two to three months after approval for Extra Help.
l People automatically enrolled in a Part D plan may change plans once in a calendar year, as well as at special enrollment.
People who apply for Extra Help through SSA can choose to have their Extra Help application data transmitted to DHS to initiate an application for MA or MSP. Consider receipt of SSA data as a request for coverage for MHCP. DHS will automatically send a Minnesota Health Care Programs Application (HCAPP) (DHS-3417) to each client whose data SSA transmits to DHS who has a verified address. See Applications for Health Care Programs - SSA Data as a Request for MHCP for more information.
Extra Help and Medicare Savings Programs
Screen Medicare beneficiaries who contact your office for Medicare Savings Programs (MSP) eligibility. These people, if eligible and enrolled in an MSP, are qualified to receive Extra Help automatically.
Use the Do You Want to Stretch Your Dollars (DHS-4033) screening tool when Medicare beneficiaries:
l Inquire about Medicare Part D.
l Request help with Medicare Part D costs.
l Ask for an application for Extra Help.
l Ask for help when completing the Extra Help application.
Tell clients about the Extra Help subsidy application process through the SSA if they are not eligible for an MSP or MA, or not interested in applying for these programs.
Temporary Prescription Drug Coverage for Full Benefit Dual Eligibles
Encourage full benefit dual eligibles to enroll in a Medicare Part D plan and not wait for the Centers for Medicare and Medicaid Services (CMS) to enroll them in a plan. These people have access to temporary prescription drug coverage until they are enrolled in a Medicare Part D plan.
CMS contracts with a national company to temporarily cover Medicare prescription drugs for full-benefit dual eligibles not enrolled in Medicare Part D. People access this temporary coverage through their pharmacy.
This temporary coverage is available to:
l New full benefit dual eligibles who have:
n not yet chosen a Medicare Part D plan.
n chosen a plan but it is not yet effective.
l Any full benefit dual eligibles who are not currently enrolled in a Medicare Part D plan, although they may have been in the past or may be enrolled effective in a future month.
Note: Full benefit dual eligibles changing Medicare Part D plans can avoid gaps in Medicare Part D coverage and potential pharmacy problems with using the temporary prescription drug coverage by enrolling in the new Part D plan, but not disenrolling from the old Part D plan. Enrollment in the new plan will automatically trigger disenrollment from the old plan.
Full benefit dual eligibles not enrolled in a Part D plan:
l Should be able to fill prescriptions through the temporary plan if they present both their Minnesota Health Care Program (MHCP) and Medicare cards at the pharmacy.
l Will not be automatically enrolled in a Part D plan by CMS if they have enrolled in a Part D plan and are just waiting for the effective date.
l Will be automatically enrolled in a Medicare Part D plan by CMS if they do not have a plan enrollment pending. Enrollment effective dates can vary.
Example:
Melissa is a Medicare beneficiary but is not enrolled in Part D. She applies for MA on June 5, with coverage requested back to March 1. Melissa is eligible for MA effective March 1.
Action:
MA cannot pay for prescription drugs that would be covered by Medicare Part D for Melissa because she is eligible, but not enrolled in Part D.
Melissa contacts the Linkage Line in June and enrolls in a Medicare Part D plan effective July 1. However, she reports to her worker that she needs to fill several prescriptions.
Action:
Melissa can bring her MHCP card and her Medicare card to the pharmacy when she fills her prescriptions. The pharmacist will use the point of sale plan to provide Melissa with her prescription drugs for June. CMS will not enroll her in another plan because she has already enrolled in a Part D plan for July 1.
Medicare Cost-Sharing Amounts: Provides a breakdown of cost-sharing expenses for people qualified for full subsidy Extra Help.
Medicare Part D Benchmark Plans: Provides a list of benchmark plans and a link to benchmark premium amounts.
MA and Medicare Part D: Provides information on how the Extra Help program may affect a spenddown or LTC income calculation.
Applications for Health Care Programs: Provides information on how an application for Extra Help can become an application for MHCP.