NC Cooperative Extension Service

Our mission is to help people improve the quality of their lives
through research-based information and informal educational opportunities
focused on issues and needs.

NEWS RELEASE
Pearl W. Stanley
Extension Agent
Family and Consumer Sciences, CFCS
Bolivia, NC 28422
March 2004

A MEDICARE REFORM OVERVIEW

After years of debate, the President signed a Medicare Reform Bill that includes prescription drug coverage. This law adds new coverage for prescription drugs and preventive benefits and provides extra help to people with low incomes. People with Medicare can choose to stay with the Medicare coverage they have now, or enroll in the new options. They should also remember that while the bill has been signed into law, the actual full prescription drug coverage will not begin until 2006.

Medicare’s Prescription Drug Discount Programs
 Beginning 2004 and continuing through 2005, Medicare will provide prescription drug discount cards to people needing help paying for prescription drugs. Companies who sponsor a discount card and meet Medicare’s standards will have a Medicare-approved seal on their discount card. Medicare will contract with private companies to offer new drug discount cards until a Medicare prescription drug benefit starts in 2006. It is important to remember that prescription drug discount cards are voluntary. If a Medicare beneficiary does not choose a discount card, then he/she will not be automatically enrolled into a prescription drug discount card program.

Almost everyone with Medicare can choose to join a prescription drug discount card program. The only people who cannot enroll in a Medicare-approved prescription drug discount card program are those who have outpatient prescription drug coverage through Medicaid. The annual enrollment fee for the prescription drug discount cards will not exceed $30. Medicare recipients should expect to save 10 to 25 percent on prescription drugs. Savings will vary, and participants may not save on every medicine they need.

People whose income is less than $12,124 as a single person or less than $16,363 for a married couple, may qualify for $600 to help pay for their prescription drugs. If a person qualifies, Medicare will put a $600 credit on the Medicare-approved prescription drug discount card that can be used when purchasing prescription drugs. Those who qualify will not have to pay the annual enrollment fee. To apply for this credit, Medicare recipients should complete an enrollment form for a prescription drug discount card including the section for the $600. People who have drug coverage from Medicaid, TRICARE for Life or an employer group health plan will not qualify for the $600.

Medicare’s Prescription Drug Benefit
Medicare’s new prescription drug benefit begins in 2006. Everyone with Medicare will have the option to enroll in a plan that covers prescription drugs. Plans may vary and will be offered by private companies. In general, they will work as follows:

Some prescription drug plans may have additional options to help pay out-of-pocket costs.

People with low incomes and limited assets may qualify to receive extra help to pay for prescription drugs through the Medicare prescription drug benefit. Medicare beneficiaries who qualify will only pay a small copayment for each prescription drug they need. Depending on income and asset levels, the premiums and deductibles may be covered or lowered. For example, people with Medicare who have incomes below a certain limit (less than $12,124 for a single person or less than $16,363 for a married couple) will not have to pay the premiums or deductible for prescription drugs. Other people with low incomes and limited assets will get help paying the premiums and deductible. There will be a limited amount paid for each prescription drug.

People with Medigap plans that cover prescription drugs (Plans H, I and J) who choose to renew their policy will not qualify for a Medicare prescription drug plan. Those beneficiaries can choose to keep their current policy and coverage as is or enroll in a different Medigap plan that does not offer drug coverage and chose a Medicare prescription drug plan.

SHIIP continues to learn more about the bill and educates staff and volunteers with information regarding the benefits of the new bill. SHIIP’s Toll Free Consumer Line (1-800-443-9354) is available Monday through Friday from 8 a.m. to 5 p.m. You can visit the Web site at www.ncshiip.com www.ncshiip.com to answer Medicare beneficiaries’ questions or e-mail shiip@ncdoi.net to get your questions answered online. SHIIP also has trained volunteers in all 100 counties of North Carolina for one-on-one counseling sessions. To reach a SHIIP volunteer counselor in your area, contact Pearl W. Stanley, Family Consumer Education Agent: