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Medicare Part D – Think “D” for Disaster The Advocate’s Guide for Organizing To Improve Medicare Drug Coverage. David Grant and Marie Jobling Presenters CARA 415-550-0828. This Workshop brought to you by….

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Medicare Part D – Think “D” for Disaster The Advocate’s Guide for Organizing To Improve Medicare Drug Coverage

David Grant and Marie Jobling


CARA 415-550-0828


This Workshop brought to you by…

California Alliance for Retired Americans (CARA) 877-223-6107 in partnership with theMedicare Advocacy Collaborative:- Health Access California - OWL - California - Gray Panthers - California - Congress of California Seniors This workshop made possible in part by a grant from The California Wellness Foundation.

medicare part d time to shout out an alarm
Medicare Part D - Time to “Shout Out” an Alarm
  • Everywhere folks are talking about Part D
  • Mostly, individuals are trying to figure out if it will help or hurt them
  • We need to raise the “red warning flag” about dangers as they unfold.
  • We need to “Shout Out” that Medicare Part D has too many problems and must to be “Reconsidered and Replaced” by Congress
overview of today s workshop
Overview of Today’s Workshop
  • Medicare Part D – The Basics
  • Medicare Part D – An Advocate’s Perspective
    • Does Medicare Part D reduce cost & improve access?


    • Does it simply privatize a major part of Medicare by turning over drug coverage to an unregulated army of private drug providers (while sacrificing the standard benefits fundamental to Medicare?)
  • CARA’s Call to Action!
here is a clue
Here is a CLUE…
  • In 2003, when Medicare Part D was enacted, the Drug Companies…
    • hired 952 lobbyists,
    • spent $141 million on
    • lobbying
    • contributed more than
    • $30 million to campaigns.
  • Drug profits rose $182 billion.
medicare part d working for you
Medicare Part D – Working for YOU?

What has been your

experience so far?

welcome to medicare part d the basics
Welcome to Medicare Part D “The Basics”
  • Coverage began January 1, 2006 for those enrolled
  • Available for all people with Medicare, but impacts particular groups differently
  • Drug Benefits provided through Private Plans:
    • Prescription Drug Plans (PDP’s)
    • Medicare Advantage Plans (HMO’s)
  • Some Employer and Union Retiree Plans receive government subsidies to help prevent them from dropping drug coverage.
how it works the basics
How it Works – The Basics
  • Monthly premium: minimum of $5.31 to $66.00 per month (in California)
  • Deductible - $250 per year
  • Co-payment - $500 maximum based on drug “costs” up to $2,250
  • Donut Hole – No coverage for costs from $2,250 to $5,100 (but you must keep paying monthly premiums)
  • Catastrophic Coverage – After $5,100, it covers 95% of drug costs
  • Co-pays – generally $2 - $5 for each prescription
part d plans the basics
Part D Plans – The Basics
  • Plan Choice – 47 “stand alone” plans in addition to current HMO plans
  • Co-payments, deductibles, pharmacy networks vary greatly
  • All mental health drugs, immunosuppressants, AIDS and cancer drugs are covered
  • In other categories, all drugs are not covered
  • Medi-Cal will continue to cover drugs not on Part D formulary for Medi-Cal recipients
  • Part D Plans can change formulary at any time
  • Customer service – up to each plan
  • Appeals - up to each plan
low income subsidy the basics
Low Income Subsidy – The Basics
  • Three groups “deemed” eligible for full low-income subsidy were automatically enrolled January 1, 2006.
    • Dual eligible (Medicare/Medi-Cal)
    • People with SSI
    • People enrolled in Medicare Savings Programs (QMB, SLMB & QI-1)
  • Those with incomes OVER this level and UNDER 150% of poverty level are eligible but must apply through Social Security for this benefit.
    • Single – up to $1197 monthly
    • Couple – up to $1,604 monthly
    • Excess assets may prevent you from getting this benefit.

First, you must apply for the subsidy, then you must enroll in a Part D Plan.

enrollment issues the basics
Enrollment Issues – The Basics
  • Dual Eligibles (with both Medicare and Medi-Cal):
    • Were automatically enrolled in a Part D plan January 1, 2006
    • Beneficiaries must determine if chosen plan covers their drugs and is accepted at a nearby pharmacy
    • Drugs on the Medi-Cal formulary, but not on the Part D formulary, will continue to be paid for by Medi-Cal
    • If you don’t like your plan, you can change as often as monthly
  • Medicare Only:
    • Can apply for Low-Income Subsidy
    • Are being encouraged to pick a Part D plan and enroll by May 15, 2006
    • You can only change plans during the annual open enrollment period, November 15 through December 31.
    • Beneficiaries pay a 1% of premium penalty each month if you do not enroll by May 15, 2006
dual eligibles
Dual Eligibles
  • Dual eligibles in long term care facilities

No premium, no deductible, no co-pays

  • Dual eligibles in the community and those in Medicare/Medi-Cal Medicare Savings Programs (QMB, SLMB, QI-1) or SSI/SSDI
    • No premium or deductible
    • Co-pays: $1 to $5 (per prescription)
    • No “donut hole” of non-coverage
    • No co-pay after $5,100 limit of total cost of drugs
what did the governor just do
What did the Governor just do?
  • Authorized the State to pay for medications for those Medi-Medi’s who are unable to get their drugs paid for by Medicare.
  • This coverage was only for the period January 12 through January 17, 2006.
  • Sponsors of this workshop are part of efforts with the Legislature to get this safety net coverage continued.
low income medicare beneficiaries not on medi cal
Low-income Medicare Beneficiaries Not on Medi-Cal
  • A two–step process
  • Apply for a “low-income subsidy” if income and assets are low
    • Single – up to $1,197 monthly
    • Couple – up to $1,604 monthly
    • Assets limits vary
  • Choose a prescription drug plan before May 15, 2006 and enroll – your subsidy should be automatically applied.
medicare beneficiaries with existing drug coverage
Medicare Beneficiaries with Existing Drug Coverage
  • Watch out for a letter saying if your current coverage is at least as good as Medicare Part D – the term used is “creditable” – not all plans are “creditable”.
  • These letters could come from:
    • Existing Medi-gap policies
    • Medicare Advantage HMO’s
    • VA and TRICARE
    • Union and Corporate Retiree Benefit Programs
  • Covered individuals can still sign up for a Part D plan, but may lose their regular drug AND health coverage

(More on this in the “red flag” section to follow).

  • If you have not yet received a letter, or are confused, call your health plan.
where you can go for help
Where You Can Go For Help
  • Health Insurance Counseling and Advocacy Program (HICAP): Call 1-800-434-0222 to reach your local HICAP or go to
  • Social Security: 1-800-772-1213 or go to
  • Center for Medicare and Medicaid Services (CMS): Call 1-800-MEDICARE or go to
  • Your CARA Part D Toolkit and at
  • Remember, most other sources of information are trying to sell you something
preparing advocates to raise the red flag
Preparing Advocates to “Raise the Red Flag”
  • Presentations like what you just saw are happening all over the state.
  • We need to tell the other side of the story - that

Medicare Part D = Disaster

  • We need to be “on guard” against the numerous dangerous features of Medicare Part D
  • Let’s count the ways that Part D is a Disaster…
1 enrollment chaos and confusion
#1 Enrollment = Chaos and Confusion
  • Enrollment is being pushed too quickly
  • Enrollment decisions are too complex
  • Too few resources are available to help consumers
  • Too little information is available in multiple languages and in formats easy for consumers to understand.
2 medi cal enrollment nightmare
#2 Medi-Cal Enrollment Nightmare
  • On January 1, over 1 million Medi-Cal beneficiaries were automatically switched to Medicare Part D. Horror stories include:
    • Pharmacies can’t access computer system to process claims. When they do, data is not accurate.
    • Phone lines for Medicare and the private plans totally overwhelmed
    • High co-payments and totally different formularies mean beneficiaries leave without lifesaving drugs.
    • California and other states must step in to bail out the program.
3 late enrollment penalty it lasts a lifetime
#3 - Late Enrollment Penalty It Lasts A Lifetime!
  • Beneficiaries not automatically enrolled have until May 15, 2006 to chose a plan.
  • After May 15, 2006, if you have not chosen a plan, you will pay 1% of the average area premium PER MONTH…FOR LIFE as your penalty!
  • Example – say the average monthly premium in your area is $50 a month. If you wait 12 months to sign up, your premium would be $50 + $6 (12% of $50) every month or an additional $72 per year forever! If the rate goes up, your penalty goes up proportionately. If you wait longer, the penalty just keeps growing.
4 retirees with current drug coverage beware
#4 -Retirees with Current Drug Coverage - Beware!
  • Retirees with current drug coverage through a retiree or employer health plan could lose ALL RETIREE HEALTH COVERAGE (not just drug coverage) by signing up for Medicare Part D.
  • Many letters to retirees regarding “creditable coverage” do not make this pitfall clear.
  • If you mistakenly join Part D, you and your family members covered by the retiree plan may not be able to get the coverage back.
5 the donut hole not such a sweet deal
#5 The “Donut Hole” – Not Such A Sweet Deal
  • You get no coverage for costs between $2,250 and $5,100
  • You keep paying premiums but get no benefit
  • It is unclear what drug costs will get counted toward the $2,250 (i.e. all out of pocket costs or only those that show up in the Medicare computer)
  • Many factors will make it difficult for individuals to reach the other side of the hole ($5,100) and to start getting benefits again.
6 choosing a plan welcome to the valley of tiers
#6Choosing a Plan? Welcome to the Valley of Tiers
  • Already complex decisions related to cost and coverage are now more difficult because of choices within plans.
  • Many plans are organized into different “tiers” based on whether you are using generic, preferred, non-preferred, or specialty drugs – Higher tier = Higher cost.
  • Plans may force you to try cheaper drugs, perhaps with bad side effects, before you can get the “higher tier” drug they offer.
  • In addition, plans have different costs depending on whether you go to a preferred, non-preferred or off-plan pharmacy.
  • For example, you could have as 12 different combinations of premium and co-payment amounts and the possibility of even more confusion if all your drugs are not covered in one plan
  • End result – it is virtually impossible to make an informed choice!
danger with part d you could pay more
DANGER – With Part D, You Could Pay MORE!
  • Annual Premium $ 445
  • Annual Deductible $ 250
  • Co-payments (varies) $ 155 - $500
  • Donut hole coverage gap $ 2,850
  • Additional charges based on

whether drug is covered,

pharmacy is in network, etc. Unknown

  • How does this compare with what you pay now?
  • How does it compare if you simply bought your drugs from Canada or from places like Costco?
  • How would it compare if the government could negotiate lower drug prices, like those for the VA?
7 12 more dangers on the road to part d
#7-12More Dangers on the Road to Part D
  • Persons in special programs for HIV/AIDS, disabled children, other groups face even more confusion.
  • Many beneficiaries will find this new “benefit” actually reduces assistance from other programs like food stamps.
  • Beneficiaries in long term care facilities nursing home left to fend for themselves in terms of making choices.
  • Each plan has its own grievance and appeal process. Doctors and patients are forced to deal with multiple, differing appeal processes to get needed drugs.
  • Beneficiaries will be trapped in plans even if drug formularies changes
  • Drug plans have little or no oversight from government.
13 unlucky california will lose nearly 420 million
#13 Unlucky California Will Lose Nearly $420 Million
  • The federal government will “clawback” $1.4 billion of the money formerly in Medi-Cal.
  • Experts estimate that over-all, California will lose more than $250 million in the first year alone.
  • Since the State is no longer buying drugs directly, it potentially loses all the discounts and rebates, an estimated loss of $170 million more.
america can do better
America Can Do Better

After all that you’ve heard, what do YOU think…

Will Medicare Part D reduce cost, improve access, and increase your ability to live a healthy life?

together we can get a real prescription drug benefit
Together We Can Get A Real Prescription Drug Benefit
  • CARA has a plan for how to “Reconsider and Reform” Medicare Part D,
  • Here are at least 4 Ways you can help.
at the national level circulate advocate
At the national level… CIRCULATE & ADVOCATE
  • Take the CARA Medicare Petition and get everyone you know to sign it.
  • Tell people about the problems with Part D and urge them to join the fight for a Real Drug Plan.
  • Join the CARA Action Team (CAT) and participate in meetings in your area. Call 877-223-6107(toll free) for the Team in your area.
  • Organize to hold your representative accountable for real relief from high drug costs
    • Support HR 3861, the Medicare Informed Choice Act (Stark, Schakowsky) to extend the deadline
    • Support HR 752 (Stark, Berry) the Medicare Prescription Drug Savings and Choice Act, to create a uniform drug benefit in Medicare and require that Medicare negotiate for the best possible prices. 
call your congressional representatives
  • Dial the House & Senate switchboard


  • Ask the operator for the first representative you want to reach
  • When connected: “Hello, I live in your district and I’m calling to ask you to:
    • Support HR 3861, the Medicare Informed Choice Act to extend the enrollment period and protect against bad choices.
    • Support HR 752, the Medicare Prescription Drug Savings and Choice Act, to create a uniform drug benefit in Medicare and require Medicare negotiate for the best prices
    • Reconsider & replace Medicare Part D with real reform that saves Medicare and provides relief from high drug prices.”
  • Repeat until you have called all 3 of your representatives!
  • Call today, call often, get your friends to call too!
  • Be part of a team to follow-up on today’s workshop.
    • Take what you’ve learned today back to other groups you’re involved with
    • Attend local Medicare Part D trainings and workshops to help “raise the red flag” about problems with Part D.
    • Write a “Letter to the Editor” about the pain and confusion Medicare Part D is causing

(see information in your toolkit).

shout out and tell our stories
  • Share your experiences and those of people you know
    • “Tell Your Story” form is in the Toolkit to help make the issues real to the media and local policymakers.
    • Tell your story today!
    • Collect stories from others tomorrow
    • Host a local “Shout Out” to get the press to cover the “dangerous side” of Part D.
  • The Tool Kit can help guide you with these and other actions.
  • Your local CAT Team can help you organize a “shout-out and media” in your area.
at the state level organize mobilize
At the state level…ORGANIZE & MOBILIZE
  • Support State legislation being developed for the 3rd year of the statewide OuRx Coalition - Year 3? – Part D!
    • Establish a “wrap-around” benefit to protect “Medi-Medi’s”
    • Provide assistance with co-payments and deductibles
    • Increase funding for consumer counseling and support
    • Demand oversight and regulation of drug plans
  • Participate in state hearings on Medicare Part D
  • Coordinate “shout-outs” and legislative visits through the local CAT’s to participate in your area.
reach out to potential allies
  • CARA member groups
  • Local senior and disability advocacy groups
  • Pharmacists and their organizations
  • Non-profit housing providers to seniors and persons with disabilities
  • Nursing Homes & Residential Care Facilities
  • Legal Services Programs
  • Paid and family care givers
call to action
  • Now it’s time to move into action
  • Join us as we plan the next steps in your area
  • And to end on an up-beat note, join us in song as we prepare to march and sing our way into the history books.
stay involved join the cara action team cat
Stay Involved - Join the CARA Action Team (CAT)

The Alameda County CAT meets

every 2nd Monday, at 10:00 a.m.

South Berkeley Senior Center

Ellis at Ashby in Berkeley

For more information, contact

Jim Forsyth at 510-581-5169.