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Effective: January 1, 2007 |
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04.40.20ar2 - Medicare Part D (Archive) |
Archived: February 1, 2009 |
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 was rolled out in January 2006 and is available to people either entitled to Medicare Part A or enrolled in Medicare Part B. Enrollment in Medicare Part D is voluntary.
People have a wide variety of Medicare-approved plans to choose from.
Extra Help and Medicare Savings Programs.
Benchmark Plan
A prescription drug coverage plan that has been designated by Medicare to meet certain coverage requirements and which has a monthly premium that is fully subsidized by Extra Help. See Medicare Part D Benchmark Plans for a list of benchmark plans.
Extra Help
A Medicare Part D cost-sharing subsidy program. Full-benefit dual eligible enrollees receive full subsidies while others may apply to the Social Security Administration for full or partial subsidies.
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.
l This includes MSHO, MnDHO and MA-EPD enrollees.
l 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.
The drugs covered can vary depending on the drug coverage plan chosen. Plans can cover generic and brand-name drugs.
Note: Clients with questions about covered drugs under Part D should contact Medicare. See Medicare Contact Information for phone numbers a client may call.
Refer clients who are entitled to Medicare Part D coverage and who want to apply for that coverage to:
l The Linkage Line at 1-800-333-2433.
l Medicare at 1-800-MEDICARE (1-800-633-4227) or TTY users at 1-877-486-2048.
Most people will be responsible for cost-sharing including:
l A monthly premium.
The cost of the premium is dependent on what drug plan is chosen and the person’s financial situation.
People who decide not to enroll in a drug plan when they are first eligible will have a penalty assessed if they choose to enroll after their initial eligibility date.
Exception: Beneficiaries who have creditable drug coverage under a health insurance plan or a Medigap (Medicare Supplement Insurance) policy do not have to enroll in Part D and will not have a penalty if they later decide to drop their current coverage and enroll in Part D.
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 ”r;doughnut hole.”
For a breakdown of cost-sharing expenses for standard benefits for Medicare Part D, see Medicare Cost-Sharing Amounts.
Some people 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. There are two types of Extra Help:
l Partial subsidy.
l Full subsidy.
A person must be within certain income and asset limits to qualify for a subsidy. Some people must complete and submit a formal application to SSA for Extra Help, while others are automatically qualified.
For help with the application process, to apply or to request an application, clients may contact:
l The Linkage Line at 1-800-333-2433.
l SSA at 1-800-772-1213, or 1-800-325-0778 between 7am – 7pm Monday through Friday.
l SSA website at http://www.socialsecurity.gov/.
People who apply and are approved for Extra Help by SSA are eligible for a special enrollment period to enroll in Medicare Part D.
l CMS will automatically enroll people in a Part D plan if they have been approved 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.
For a breakdown of cost-sharing expenses for people receiving Extra Help for Medicare Part D, see Medicare Cost-Sharing Amounts.
Extra Help and Medicare Savings Programs
Screen Medicare recipients 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 recipients:
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.
Provide clients not eligible for an MSP or MA, or not interested in applying for these programs, with information on the subsidy application process through SSA.
The following people, regardless of age, are eligible for a full subsidy automatically regardless of their income and assets:
l Full benefit dual eligibles.
Note: Full benefit dual eligibles may enroll or switch their Medicare Part D plan at any time.
l Medicare Savings Program (MSP) enrollees.
l Supplemental Security Income (SSI) recipients.
To identify enrollees eligible for full subsidy, DHS sends a data file to the Centers for Medicare and Medicaid Services (CMS) six working days prior to the last working day of each month.
l The data file identifies all federally funded MA and MSP enrollees who have Medicare data in MMIS. Data includes the current month and changes completed for previous months.
n Updates or changes made after the data file is created are reflected on the next month’s data file. CMS is currently working to resolve issues associated with the delays of recognizing a person’s Extra Help qualification and its delays with the Medicare Part D plan coverage and pharmacy notification.
n The Social Security Administration (SSA) also sends a data file identifying SSI recipients.
l CMS deems the enrollee qualified for Extra Help. It also identifies individuals enrolled in MA or an MSP who are not enrolled in Medicare Part D so as to randomly and automatically enroll the person 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 subsidy will begin 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 qualifying for Extra Help retroactively.
l Once a person is determined eligible for the full subsidy, the subsidy will continue for the remainder of the calendar year, regardless of MA, MSP or SSI eligibility.
Note: People who appear to be full benefit dual eligible in at least one data tape exchange between July 2006 and December 2006 will continue to be deemed eligible for Extra Help through 2007.
l People who are closed from MA, an MSP or SSI must submit a formal application to SSA for the following year.
See the following sections for more information:
l Medicare Cost-Sharing Amounts: Provides a breakdown of cost-sharing expenses for people qualified for full subsidy Extra Help.
l Medicare Part D Benchmark Plans: Provides a list of benchmark plans and a link to benchmark premium amounts.
l MA/GAMC and Medicare Part D: Provides information on how the Extra Help program may affect a spenddown or LTC income calculation.
There is an open enrollment period from November 15th to December 31st of each year. People may change prescription drug plans during this open enrollment period.
Note: Full benefit dual eligibles may choose to switch Medicare Part D plans at any time, and do not have to wait for open enrollment or meet criteria for special enrollment.
Special enrollment periods are available for the following:
l The person moves out of the plan service area.
l The person enters, resides in or leaves a long-term care facility.
l The person has an involuntary loss or reduction of creditable coverage.
l Other exceptional circumstances.