Medicare prescription drug coverage for dummies

Medicare Prescription
Drug Coverage
FOR

DUMmIES

‰

by Patricia Barry



Medicare Prescription
Drug Coverage
FOR

DUMmIES

‰

by Patricia Barry


Medicare Prescription Drug Coverage For Dummies®
Published by
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About the Author
Patricia Barry is a recognized expert on Medicare and its Part D prescription
drug coverage. As a senior editor of the AARP Bulletin — the newspaper and
Web site that serve AARP’s 40 million members — she’s written extensively
about Medicare from the consumer’s point of view since 1999. That year, she
went to a press conference at the White House to hear President Bill Clinton
announce his proposal to add outpatient prescription drugs to Medicare and
came away thinking: “This story has legs — it’ll run and run.” For the next
four years, she covered the bitter political battles in Washington that finally
led to President George W. Bush signing Part D into law in December 2003.
Ever since, Patricia’s mission has been to explain the controversial and complicated benefit to consumers. She’s written numerous articles and guides on navigating Part D for AARP publications and books. Before and after the drug benefit
went into effect in 2006, she invited readers’ questions and personally answered
hundreds of them. She continues to do so through the Bulletin’s Web site
(bulletin.aarp.org). Patricia has directly helped many, many people —
readers, friends, neighbors, and colleagues’ parents — find the Part D plan that
suits them best. Those questions and experiences are the foundation of Medicare
Prescription Drug Coverage For Dummies.
In her long journalism career in Europe and America, Patricia has written
thousands of newspaper and magazine articles and three books. A native of
Great Britain, she’s lived since 1985 in Maryland, where she and her husband
raised three adventurous children — Katerina (currently living in Russia),
Jessica (in France), and Oliver (in Egypt). In 2006, not without a sense of

mutinous disbelief, Patricia became a Medicare beneficiary herself.



Dedication
This book is dedicated to the hundreds of older or disabled Americans who
so generously shared their personal Part D stories with me since Medicare
prescription drug coverage began. You told me what it was like on the front
lines — experiences that were good, bad, and occasionally downright ugly.
You prompted me to find answers to questions I hadn’t thought of asking.
You gave me the motivation to write this book, and I couldn’t have done it
without your insights. You were the consumer pioneers of Part D. To each
and every one — a huge thank you!

Author’s Acknowledgments
Writing this book has been a roller coaster grounded by the expertise and
wisdom of many people who kept me on track. My thanks go to experts at
two key federal agencies, the Centers for Medicare & Medicaid Services and
the Social Security Administration, who helped me through the labyrinth of
regulations that govern the Part D program and patiently answered hundreds
of questions I threw at them. I’m also indebted to experts at the consumer
help organizations who daily assist Medicare beneficiaries with Part D issues:
the Medicare Rights Center, the Center for Medicare Advocacy, California
Healthcare Advocates, and the State Health Insurance Assistance Programs.
I’m especially grateful for the advice and generously shared knowledge of
many colleagues at AARP: David Gross, Gerry Smolka, Paul Cotton, Ed Dale,
Lee Rucker, Elinor Ginzler, and, above all, Joyce Dubow, a national expert
who for many years has been my guru on all things Medicare. I thank my editors at the AARP Bulletin, Jim Toedtman and Susan Crowley, for their encouragement and forbearance when I needed to take time out — and my former
editors, Elliot Carlson and Bob Hey, who first twisted my arm to take on the
Bulletin’s Medicare beat.

I’m enormously grateful to my project editor on this book, Georgette Beatty,
and copy editors Vicki Adang and Jen Tucci at John Wiley & Sons, who have
been a pleasure to work with. Also to Vicki Gottlich, of the Center for
Medicare Advocacy, for her profound knowledge of Part D and vigilant eye
while acting as technical adviser during the book’s draft stages. And to my
superb agent, Maureen Watts, who got this ball rolling.
Finally, to my children (who urged me on when I felt daunted by the task) and
to my husband (whose devotion ran to cooking dinner every night for
months), I can only say: What would I do without you?


Publisher’s Acknowledgments
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Acquisitions, Editorial, and
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Technical Editor: Vicki Gottlich,
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Contents at a Glance
Introduction ................................................................ 1
Part I: The Nuts and Bolts of Medicare
Prescription Drug Coverage .......................................... 7
Chapter 1: The ABCs (And D) of Medicare ..................................................................... 9
Chapter 2: The Rules of the Game: How Part D Works ............................................... 23

Chapter 3: The Big Question: What Will Part D Cost (And Save) You?..................... 31
Chapter 4: Delving into Drug Coverage under Part D ................................................. 43
Chapter 5: Extra Help: A Better Deal if Your Income Is Low ...................................... 57

Part II: Deciding Whether to Sign Up for Part D .......... 83
Chapter 6: Taking Other Drug Coverage and Sources into Account ......................... 85
Chapter 7: Considering Coverage if You Take Few or No Drugs Right Now .......... 105
Chapter 8: Confronting the Late Penalty .................................................................... 113

Part III: Choosing and Enrolling
in the Right Part D Plan for You ............................... 123
Chapter 9: The First Cut: Deciding How You Want to Receive
Your Medical Benefits................................................................................................. 125
Chapter 10: Making a Smart Choice among Medicare Prescription Drug Plans .... 149
Chapter 11: Buyer Beware: Avoiding Scams and Hard-Sell Marketing.................... 183
Chapter 12: Signing Up for a Part D Plan for the First Time ..................................... 195

Part IV: You’re In! Navigating Part D
from the Inside ........................................................ 205
Chapter 13: You’ve Just Signed Up — What Happens Now? .................................... 207
Chapter 14: Filling Your Prescriptions ........................................................................ 221
Chapter 15: In and Out of the Coverage Gap .............................................................. 233
Chapter 16: Bringing Down Your Drug Costs ............................................................. 249
Chapter 17: Switching to Another Plan ....................................................................... 263
Chapter 18: Staying in Long-Term Care (Or Helping Someone Who Is) ................. 283
Chapter 19: You Have Rights: How to Holler and (If Necessary) Holler Louder ... 293


Part V: The Part of Tens ........................................... 313
Chapter 20: Ten Ways Boomers Can Help Loved Ones with Part D........................ 315

Chapter 21: Ten Proposed Changes to Part D You Should Know About ................ 321

Part VI: Appendixes ................................................. 325
Appendix A: Worksheets............................................................................................... 327
Appendix B: Sources of Help ........................................................................................ 333
Appendix C: Buying Prescription Drugs Safely from Abroad ................................... 345

Index ...................................................................... 351


Table of Contents
Introduction ................................................................. 1
About This Book .............................................................................................. 2
Conventions Used in This Book ..................................................................... 2
What You’re Not to Read ................................................................................ 3
Foolish Assumptions ....................................................................................... 3
How This Book Is Organized .......................................................................... 4
Part I: The Nuts and Bolts of Medicare Prescription
Drug Coverage .................................................................................... 4
Part II: Deciding Whether to Sign Up for Part D ................................. 4
Part III: Choosing and Enrolling in the Right Part D Plan for You .... 5
Part IV: You’re In! Navigating Part D from the Inside ........................ 5
Part V: The Part of Tens ........................................................................ 5
Part VI: Appendixes ............................................................................... 6
Icons Used in This Book ................................................................................. 6
Where to Go from Here ................................................................................... 6

Part I: The Nuts and Bolts of Medicare
Prescription Drug Coverage ........................................... 7
Chapter 1: The ABCs (And D) of Medicare. . . . . . . . . . . . . . . . . . . . . . . . .9

Knowing Your Place in the Wide World of Medicare .................................. 9
Examining Costs and Coverage in Medicare’s Four Parts ........................ 11
Part A ..................................................................................................... 11
Part B ..................................................................................................... 12
Part C ..................................................................................................... 13
Part D ..................................................................................................... 14
Comparing different types of Medicare insurance .......................... 14
Getting with the Program: When and How to Sign Up
for Parts A and B ........................................................................................ 17
It’s all in the timing: When to sign up ................................................ 17
Taking the plunge: How to sign up .................................................... 20
Lowering Costs and Adding Benefits .......................................................... 20
Medicare supplementary insurance (also known as Medigap) ..... 21
Medicare Advantage plans (Part C)................................................... 21
Veterans benefits ................................................................................. 22
Medicaid................................................................................................ 22
State Medicare savings programs...................................................... 22


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Medicare Prescription Drug Coverage For Dummies
Chapter 2: The Rules of the Game: How Part D Works . . . . . . . . . . . . .23
Qualifying for Medicare Prescription Drug Coverage ............................... 23
Voluntary Enrollment and All the Strings Attached.................................. 24
Picking a Plan, Any Plan — but Only One................................................... 25
Making Sense of Drug Coverage That Can Vary throughout the Year.... 26
Getting Coverage for the Drugs You Take .................................................. 28
Paying for Your Drugs and Filling Your Prescriptions.............................. 28
Being Locked into One Plan for a Year ....................................................... 29

Chapter 3: The Big Question: What Will Part D Cost
(And Save) You? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
Decoding the Jargon of Medicare Drug Payments .................................... 32
Making a commitment: Monthly premium ....................................... 32
Forking over the first financial slice: Annual deductible ................ 32
Sharing the pain: Co-payments and coinsurance ............................ 32
Leveling on costs: Tiers of charges ................................................... 33
Getting out your wallet: Full price ..................................................... 33
Counting the cost: True out-of-pocket costs .................................... 34
Grasping How Costs Fit Together and Add Up .......................................... 34
The importance of the drugs you take .............................................. 35
The importance of the plan you choose ........................................... 36
Putting together drug costs and plan designs:
Three common examples ................................................................ 37
Knowing the Costs That Plans Can (And Can’t) Change
during a Calendar Year ............................................................................. 39
The costs your plan can’t change ...................................................... 40
The costs your plan can change ........................................................ 40
Being aware of your rights.................................................................. 40
Understanding How Costs May Change from Year to Year ..................... 41

Chapter 4: Delving into Drug Coverage under Part D . . . . . . . . . . . . . .43
Finding Out about Formularies .................................................................... 44
The drugs that Part D plans must cover ........................................... 45
The drugs that Medicare doesn’t pay for ......................................... 46
The off-label uses for some drugs...................................................... 47
The rules of formulary changes ......................................................... 47
Making Sense of Special Restrictions on Some Covered Drugs ............... 48
Getting the Drugs You Need When They’re Restricted or

Not Covered ................................................................................................ 49
Sidestepping the hoops....................................................................... 49
Understanding the 30-day rule ........................................................... 50
Trying another drug ............................................................................ 50
Requesting an exception with your doctor’s help........................... 50
Obtaining excluded drugs................................................................... 54
Getting drugs for off-label uses .......................................................... 55
Knowing When Drugs Are Covered by Part D, Part A, or Part B ............. 56


Table of Contents
Chapter 5: Extra Help: A Better Deal if Your Income Is Low . . . . . . . .57
Understanding the Value of Extra Help ...................................................... 58
Qualifying Automatically for Extra Help ..................................................... 63
Applying for Extra Help ................................................................................ 64
Obtaining an application form ........................................................... 64
Helpful tips for filling out the application......................................... 65
Getting a hand with applying ............................................................. 69
Signing and sending in your application ........................................... 70
Knowing what happens next .............................................................. 70
Figuring Out Whether Extra Help Affects Other Assistance .................... 71
Choosing a Drug Plan, Signing Up, and Switching Plans .......................... 72
Before you choose: Realizing that some plans may cost you
more than others.............................................................................. 73
Finding a plan with the premium you want and the drugs
you need ............................................................................................ 74
Joining and switching plans ............................................................... 76
An option to consider: Participating in a State Pharmacy
Assistance Program ......................................................................... 77
Determining Whether You’ll Qualify for Extra Help

All Year and Next Year .............................................................................. 78
How you could lose Extra Help .......................................................... 78
Finding out where you stand .............................................................. 79
Taking Action if You’re Denied or Lose Your Eligibility for Extra Help .... 80
Appealing a “no” decision ................................................................... 80
Getting Extra Help another way ......................................................... 81
Seeking other help to pay for drugs .................................................. 82
Looking for help to pay other expenses ........................................... 82

Part II: Deciding Whether to Sign Up for Part D ........... 83
Chapter 6: Taking Other Drug Coverage and Sources into Account . . .85
Finding Out Whether Your Current Drug Coverage Is Creditable ........... 86
Drug coverage from a current or former (nonfederal)
employer ........................................................................................... 87
Drug coverage for federal employees and retirees ......................... 89
Veterans drug benefits ........................................................................ 90
Medicaid drug coverage...................................................................... 90
Drug coverage from a State Pharmacy Assistance Program .......... 91
Drug coverage for Native Americans ................................................ 92
Drug coverage from Medigap insurance ........................................... 92
Drug coverage from individual insurance ........................................ 93
Deciding Whether to Stay with the Coverage You Have or
Switch to Part D.......................................................................................... 93
Considering the other factor: Medical benefits ............................... 96
Determining whether Extra Help can help ....................................... 98
Understanding the Medigap dilemma ............................................... 99

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Medicare Prescription Drug Coverage For Dummies
Having It Both Ways: Using Part D as Well as Your Own Drug
Insurance................................................................................................... 100
Employer or union coverage ............................................................ 101
Federal drug benefits......................................................................... 101
Veterans drug benefits ...................................................................... 102
Coverage from State Pharmacy Assistance Programs .................. 102
Individual health insurance .............................................................. 103
Factoring in Drugs from Other Sources .................................................... 103

Chapter 7: Considering Coverage if You Take Few or
No Drugs Right Now . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105
Balancing Today’s Good Health against Tomorrow’s Risks .................. 106
The odds of getting sick .................................................................... 106
The cost of going without drug coverage ....................................... 107
Compromising on Coverage at the Lowest Cost ..................................... 110

Chapter 8: Confronting the Late Penalty. . . . . . . . . . . . . . . . . . . . . . . . .113
Avoiding a Late Penalty by Signing Up for Part D at the Right Time .... 114
When you join Medicare and don’t have creditable
drug coverage ................................................................................. 115
When you lose or drop your current creditable drug coverage .... 116
When you return to the United States after living abroad ........... 116
When you’re released from prison .................................................. 117
What the 63-day rule really means .................................................. 117
The Price of Missing Your Personal Enrollment Deadline ..................... 118
Looking at how the late penalty is calculated ................................ 118
Understanding how the late penalty can add up over time ......... 119

Deciding whether to risk ignoring the late penalty ....................... 122

Part III: Choosing and Enrolling in the Right
Part D Plan for You .................................................. 123
Chapter 9: The First Cut: Deciding How You Want to Receive
Your Medical Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .125
The Features of Traditional Medicare and Medicare’s
Private Health Plans ................................................................................ 126
Traditional Medicare ......................................................................... 129
Medicare Advantage plans ............................................................... 130
Three other types of Medicare health plans .................................. 135
Deciding between Traditional Medicare and a Private Medicare
Health Plan ................................................................................................ 135
Weighing the systems ....................................................................... 136
Recognizing when you may not have a choice .............................. 139


Table of Contents
Comparing Medicare’s Private Health Plans and Making Your Pick .... 140
Determining how many plan choices you have ............................. 141
Finding a list of plans online ............................................................. 141
Digging for plan details ..................................................................... 143
Getting personal help to compare plans ........................................ 145
Watching out for hard-sell marketing pressures and scams........ 145
Asking questions before you make your final choice ................... 146
Knowing if you can make a change.................................................. 148

Chapter 10: Making a Smart Choice among Medicare
Prescription Drug Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .149
Understanding the Need to Compare Plans Carefully ............................ 150

What’s the best plan, anyway? ......................................................... 150
Is comparing plans worth the effort? .............................................. 151
Will you avoid Part D buyer’s remorse? ......................................... 152
Getting Organized with Two Crucial Lists ................................................ 153
Creating an accurate list of your meds ........................................... 154
Drawing up a list of your plan preferences .................................... 155
Introducing the Medicare Prescription Drug Plan Finder ...................... 156
Moving Step by Step through the Medicare Plan Finder —
The Fast Way ............................................................................................ 158
Drilling Down to Drug Plan Details ............................................................ 162
Making Additional Worthwhile Searches to Help Pick a Plan................ 165
Looking at the nuances of drug coverage details .......................... 166
Lowering costs with alternative drugs............................................ 168
Considering mail order ..................................................................... 172
Examining retail pharmacy choices ................................................ 172
Assessing customer service ............................................................. 175
Searching for pharmacies if you travel or
live away from home for part of the year.................................... 177
Finding Personal Help to Compare Plans ................................................. 177
Asking family or friends for assistance ........................................... 178
Seeking help from professionals ...................................................... 178
Taking advice from other sources ................................................... 181

Chapter 11: Buyer Beware: Avoiding Scams and
Hard-Sell Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .183
Steering Clear of Outright Scams............................................................... 183
Red flags to watch out for ................................................................. 184
A few lies already reported to Medicare......................................... 185
Who to contact to report a scam ..................................................... 186
Actions you can take if you’re ripped off ........................................ 186

Resisting Hard-Sell Marketing Tactics ...................................................... 188
Assessing different kinds of salesmanship ..................................... 188
Understanding the various types of Medicare insurance............. 190
Getting familiar with Medicare marketing rules ............................ 191
Thinking and checking before you sign .......................................... 193
Knowing what to do if you’re misled into
joining a plan you don’t want ....................................................... 194

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Chapter 12: Signing Up for a Part D Plan for the First Time . . . . . . . .195
Stay Informed: Knowing the Right Time to Enroll ................................... 195
Distinguishing among different enrollment periods ..................... 197
Recognizing why you shouldn’t sign up at the last minute .......... 198
Play It Safe: Making a Few Final Checks before You Sign Up ................. 199
Take the Plunge: Enrolling in a Plan .......................................................... 200
Grasping the importance of your address ...................................... 201
Deciding how to pay the premiums................................................. 202
Disclosing other drug coverage you have ...................................... 202
Don’t Give Up: Understanding Why Your Enrollment
May Be Delayed or Denied ...................................................................... 203
If your enrollment is delayed ........................................................... 203
If your enrollment is denied ............................................................. 204

Part IV: You’re In! Navigating Part D from the Inside ... 205
Chapter 13: You’ve Just Signed Up — What Happens Now? . . . . . .207

Knowing When Your Coverage Will Start ................................................. 207
Receiving Your Plan’s Card and Other Important Stuff
You Need to Read .................................................................................... 209
The membership ID card: Your key to coverage ........................... 210
Information about your plan: Your new bedtime
reading material ............................................................................. 212
A form for disclosing other coverage:
Your chance to put it all out there............................................... 214
A late penalty assessment: Your price for
missing your enrollment deadline ............................................... 214
Nice ’n’ Neat: Starting and Keeping Careful Records .............................. 217
Keeping hard-copy records you can rely on .................................. 217
Tracking information online ............................................................. 219

Chapter 14: Filling Your Prescriptions . . . . . . . . . . . . . . . . . . . . . . . . . .221
Choosing How to Fill Your Prescriptions ................................................. 222
Retail pharmacies .............................................................................. 222
Mail-order pharmacies ...................................................................... 223
Specialty pharmacies ........................................................................ 224
Going to the Right Pharmacies and Avoiding the Wrong Ones ............. 224
Using in-network pharmacies ........................................................... 225
Avoiding out-of-network pharmacies .............................................. 225
Knowing when going out of network may be okay ........................ 226
Unlocking the Information in Your Membership Card ........................... 227
Understanding what your membership card says about you...... 227
Making sure your benefits are correct and coordinated .............. 228
Putting Your Plan to the Test: Filling Your Prescriptions
on Day One................................................................................................ 229
Dodging possible snags and delays by verifying
your coverage ................................................................................. 229

Ensuring you don’t leave without your meds ................................ 231


Table of Contents
Chapter 15: In and Out of the Coverage Gap . . . . . . . . . . . . . . . . . . . . .233
Understanding the Basics of the Coverage Gap ...................................... 234
The yawning gap in the middle of coverage ................................... 234
What drops you into the doughnut hole ........................................ 237
What lifts you out of the doughnut hole ......................................... 237
Rules for buying your drugs in the doughnut hole ....................... 238
The consequences of stopping premium payments
in the doughnut hole ..................................................................... 240
Determining Whether You’ll Fall into the Coverage Gap ....................... 241
Reviewing statements from your plan ............................................ 241
Using charts on the Medicare Web site .......................................... 242
Avoiding or Narrowing the Coverage Gap with Other Benefits............. 244
Leaning on employer benefits .......................................................... 245
Filling in with veterans benefits ....................................................... 245
Seeking additional coverage from a State Pharmacy
Assistance Program ....................................................................... 246
Getting lucky with a Medicare drug plan that covers
your drugs in the gap..................................................................... 246

Chapter 16: Bringing Down Your Drug Costs . . . . . . . . . . . . . . . . . . . .249
Stretching Your Coverage .......................................................................... 249
Taking a hard look at your meds ..................................................... 250
Switching to less expensive drugs ................................................... 253
Buying drugs by mail order .............................................................. 257
Shopping around for the best prices at local pharmacies ........... 258
Lowering Drug Costs in the Coverage Gap............................................... 259

Low-cost drugs from manufacturers ............................................... 259
Low-cost drugs from abroad ............................................................ 260
Other options ..................................................................................... 261

Chapter 17: Switching to Another Plan . . . . . . . . . . . . . . . . . . . . . . . . .263
Switching Part D Plans at Standard Enrollment Times ........................... 264
Enrolling in a new plan ...................................................................... 265
Figuring out how many times you can change your mind............ 266
Switching Plans during a Special Enrollment Period .............................. 266
Knowing when you can use SEPs to change plans ........................ 267
Applying for an SEP ........................................................................... 270
Making sure your records are transferred ..................................... 270
Dropping a Plan without Joining Another (Or Being Dropped) ............ 271
Being a plan dropout ......................................................................... 272
Being dropped by your plan ............................................................. 273
A special case: Knowing what can happen when you don’t
pay your premiums ........................................................................ 274
Taking action if you’ve been disenrolled unfairly ......................... 276
Conducting a Yearly Plan Review to Decide Whether to Stay
or Switch ................................................................................................... 277
Reading your Annual Notice of Change to understand
plan alterations............................................................................... 278
Comparing plans — yes, all over again! .......................................... 279
Making your decision ........................................................................ 280

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Chapter 18: Staying in Long-Term Care (Or Helping
Someone Who Is) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .283
Reviewing Your Drug Coverage When You Enter a Nursing Home....... 284
Understanding how your drugs will be covered............................ 284
Asking important coverage questions on Day One ....................... 286
Switching to Another Plan .......................................................................... 287
Knowing your rights for changing plans ......................................... 288
Choosing and enrolling in a new Part D plan ................................. 288
Checking out two alternative plan options .................................... 289
Getting Help for Yourself or Your Loved One.......................................... 291

Chapter 19: You Have Rights: How to Holler and
(If Necessary) Holler Louder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .293
Having a Game Plan in Mind....................................................................... 293
Filing a Grievance ........................................................................................ 295
What is a grievance? .......................................................................... 295
How do you file a grievance? ............................................................ 296
Requesting a Coverage Determination ..................................................... 297
Filing for a coverage determination when it comes to
your meds ....................................................................................... 297
Filing for a coverage determination when it comes to
your hard-earned cash .................................................................. 298
Dealing with your plan’s response .................................................. 300
Filing an Appeal against a Decision You Disagree With ......................... 301
Understanding the five levels of appeal .......................................... 301
Coping with delays ............................................................................ 309
Getting Help in Making an Appeal ............................................................. 310

Part V: The Part of Tens ............................................. 313

Chapter 20: Ten Ways Boomers Can Help Loved Ones with Part D. . .315
Helping with Tact ........................................................................................ 315
Identifying the Insurance Your Loved One Has Now .............................. 316
Doing Your Homework................................................................................ 317
Offering Your Skills...................................................................................... 317
Helping to Pick a Plan ................................................................................. 318
Following Up................................................................................................. 318
Making Part D an Annual Event ................................................................. 318
Looking to Your Loved One’s Future ........................................................ 319
Remembering That Your Time Will Come ................................................ 320
Being a Bona Fide Boomer by Making Part D Better ............................... 320


Table of Contents
Chapter 21: Ten Proposed Changes to Part D
You Should Know About . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .321
Simplifying Plan Choices ............................................................................ 321
Abolishing the Asset Test for Extra Help ................................................. 322
Allowing Medicare to Negotiate Prices ..................................................... 322
Eliminating the Doughnut Hole .................................................................. 323
Improving Access to Needed Drugs .......................................................... 323
Cutting Medicare Advantage Subsidies .................................................... 323
Legalizing Drug Imports from Abroad ...................................................... 324
Creating a Government-Run Plan .............................................................. 324
Throwing Out Part D and Starting Over ................................................... 324
Bringing in Universal Health Insurance .................................................... 324

Part VI: Appendixes .................................................. 325
Appendix A: Worksheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .327
Appendix B: Sources of Help . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .333

Government Help Lines and Web Sites..................................................... 333
The Centers for Medicare & Medicaid Services............................. 333
The Social Security Administration ................................................. 334
State Health Insurance Assistance Programs................................. 334
The Eldercare Locator ...................................................................... 339
Independent Sources of Direct Help ......................................................... 339
The Medicare Rights Center ............................................................. 339
The National Alliance for Hispanic Health...................................... 340
The National Asian Pacific Center on Aging ................................... 340
Resources for Saving Money ...................................................................... 341
Consumer Information and Advocacy Organizations ............................. 342
Sources for Updates on Medicare and Part D .......................................... 343

Appendix C: Buying Prescription Drugs Safely from Abroad . . . . . .345
Distinguishing the Good Guys from the Bad ............................................ 346
Assessing safe and ethical service .................................................. 346
Avoiding scams and dubious sellers ............................................... 348
Finding a Pharmacy You Can Trust........................................................... 348
Using state links to Canadian pharmacies ...................................... 348
Looking online for seals of approval ............................................... 349

Index ....................................................................... 351

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Medicare Prescription Drug Coverage For Dummies

Introduction

I

f you’re reading this book, chances are you’re baffled. That’s okay —
you’re not alone. Since Medicare prescription drug coverage began in
2006, I’ve heard from multitudes of people trying to get their minds around
Medicare Part D — the program’s official name — and most often they call
it “confusing.” In fact, the crispest verdict came from an exceptionally onthe-ball 93-year-old who’d spent the afternoon swing dancing at a Wisconsin
senior center. He asked, simply: “Why did they come up with a program I
couldn’t figure out myself?”
That’s why I’ve written this book. There’s no doubt about it — the Medicare
drug program is complicated, largely because it comes with a lot of choices.
Sure, choice is a good thing, but having many options also forces you to
make more decisions. And to make good decisions — instead of just guessing and hoping for the best — you have to know the angles. That’s where
Medicare Prescription Drug Coverage For Dummies comes in. It takes you step
by step through the choices you face and gives you the practical knowledge
you need to make informed decisions. Consider it a road map for navigating
the twists and turns in the system so you can figure it out for yourself — and
with confidence.
Part D is a real benefit. Yes, it could be simpler and better, but it has still
saved money for millions of people and allowed many to get the meds they
need for the first time. For 40 years, Medicare didn’t pay for outpatient prescription drugs at all, and during that time, these meds became increasingly
expensive and more necessary as a medical treatment. But now there’s Part
D, and the problems are different. Typical questions I hear include:
ߜ “There are 52 Medicare drug plans in my area, so how the heck am I supposed
to choose one?”
ߜ “I’ll be getting my meds through my retiree health plan. How will Part D
affect it?”

ߜ “I was tricked into a plan I didn’t want. How do I get out of it?”
ߜ “This benefit has saved me a lot of money, but now my plan has stopped
paying for my drugs entirely. Why?”

This book answers those questions and many more. Yes, taking a whole book
to explain Part D says a lot about the program’s complexities. But in these
pages, I try to consider everybody’s circumstances by covering the widest
possible spectrum of issues. In doing so, I draw on the frontline experiences
of people like you who’ve grappled with Medicare drug coverage, my own


2

Medicare Prescription Drug Coverage For Dummies
experience in helping them, and the knowledge of many experts I’ve
badgered for answers to the trickiest questions.
So whatever your situation, Medicare Prescription Drug Coverage For Dummies
offers strategies to cut through the confusions of Part D, either for yourself
or for someone you’re helping. It explains the program’s ins and outs in plain
words. It shows you how to avoid or cope with pitfalls and suggests how you
can lower your costs or find a better deal. Best of all, it convinces you that
you can — yes, you can — handle Medicare Part D!

About This Book
Medicare Prescription Drug Coverage For Dummies gives you a lot to chew
on, but don’t worry — you can take small bites. What you personally want
to read depends on your situation — and on whether you’re using this book
to help yourself or someone else. But one matter’s certain: If you recognize
yourself in any of the following scenarios, you can find help in these pages:
ߜ You have no insurance for prescription drugs right now (or it’s coming

to an end), but you’ll soon be going into Medicare and know zip about
Part D coverage or how to get it.
ߜ You do have drug insurance now (from an employer or elsewhere) but
will soon be eligible for Medicare and need to know whether Part D will
affect you and whether you should sign up for it.
ߜ You’re already in Medicare but haven’t signed up for Part D and are
wondering whether you should.
ߜ You’re already enrolled in a Medicare Part D plan but can use some
help troubleshooting problems, finding a better deal, or cutting your
expenses.
ߜ You need to know about Part D because you’re helping parents,
relatives, or friends find the best Medicare drug plan for them.
ߜ In your job (or as a volunteer) working with seniors or people with
disabilities, you can use a plain-language reference to Part D.

Conventions Used in This Book
As you may expect from a program run by a federal bureaucracy, you’re
going to meet certain unavoidable jargon in this book. This Part D–speak is
worth getting to know, because notices you receive from Medicare or your
drug plan — or any to-and-fros you have with either — will be easier to
understand. So I use the following conventions:


Introduction
ߜ New terms in Part D–speak are explained the first time they appear.
ߜ When you see the word “Medicare” used on its own, it usually means
the whole Medicare program. (As in: “When you join Medicare . . .”)
Sometimes it means the federal agency that runs Medicare. (As in:
“Medicare may send you a notice . . .”) The agency’s official name, the
Centers for Medicare & Medicaid Services (CMS), is used as the source

of information in some tables.
ߜ The Medicare prescription drug program is referred to interchangeably
as Part D or Medicare drug coverage. The private plans that provide this
coverage are referred to as Part D plans or Medicare drug plans.
I also include a few standard conventions to help you navigate this book:
ߜ Italics indicate definitions and emphasize certain words.
ߜ Boldface text highlights key words in bulleted lists and actions to take in
numbered steps.
ߜ Monofont points out Web and e-mail addresses.
ߜ “Quotation marks” generally indicate specific buttons or links you are to
click on a given Web site.

What You’re Not to Read
Guess what? You can skip the sidebars — chunks of text that appear in nifty
gray-shaded boxes. They’re not necessary to understanding how to find your
way through Part D. Still, you may find them interesting. Ever wonder how on
earth Congress dreamed up some of the more oddball bits of this program?
You’ll find answers in the sidebars scattered throughout this book.

Foolish Assumptions
This book assumes that you don’t have any working knowledge of the
Medicare prescription drug program — none, zip, nada. But even if you do,
you can still find practical insights and useful tips to help you navigate the
system more quickly, easily, and confidently.
Another point: This book assumes no political standpoints. Part D has always
been controversial, coming under fire from conservatives and liberals alike. If
you hold strong opinions, fine — that’s your privilege. But in these pages, the
only “us versus them” undertone is a bias toward consumers (us) rather than
government bureaucracies and insurance companies (them). The aim of this
book is to help you understand and deal with the system as it is now. If you

want it changed, please tell your members of Congress, not me!

3


4

Medicare Prescription Drug Coverage For Dummies

How This Book Is Organized
Medicare Prescription Drug Coverage For Dummies has six main parts with 21
chapters and three appendixes. Just dive into whatever you need to know —
whether you’re thinking about Medicare drug coverage for the first time,
you’re already in a Part D plan, or you’re in a special situation, such as having
a limited income or living in long-term care. You don’t need to read stuff you
already know, and you don’t have to wade through stuff you don’t need to
know right now. The following summaries of each part include guidance on
what you may want to read, according to your own situation.

Part I: The Nuts and Bolts of Medicare
Prescription Drug Coverage
This first part begins with a quick run through the essentials of Medicare
as a whole. This spot’s your first port of call if you’ll soon be going into
Medicare and need to know if you qualify and how to sign up. Next, I get into
the nitty-gritty of Part D itself by first looking broadly at the main rules of the
prescription drug program and how it works. Then I take a closer look at the
big questions that matter most to your pocketbook and health — costs and
coverage. These chapters are essential reading if you’re considering Part D
for the first time.
In this part, too, I provide detailed information about the program-within-aprogram known as Extra Help, which offers much more generous drug

benefits to people with limited incomes. Head to this chapter if you think you
can’t afford the premiums and co-payments required in the regular Part D
program, or if you currently get your meds from Medicaid.

Part II: Deciding Whether
to Sign Up for Part D
For many people, this crucial question — “Do I really need Part D?” — can
cause everything from head-scratching to panic attacks. Read this part if you
already have prescription drug insurance, rely on free or low-cost drugs from
some other source, or take no or very few meds right now. Here you discover
how to find out if your current drug coverage is considered better or worse
than Part D coverage and why this distinction matters. You also find help in
weighing the consequences of continuing to have no drug coverage when
you’re eligible for Part D — including hard facts about the late penalty if you
don’t sign up for Part D at the right time.