Medicare D: Take Your Time Deciding and
Beware of Scams

Posted 10/04/05

Medicare beneficiaries can begin signing up for the new Medicare D Prescription Drug Plan on November 15. Before that date, however, they can expect to be flooded with radio, television and print ads, and with telephone and written solicitations from insurance companies inviting them to sign up for dozens of prescription drug plans with different premiums and coverage.

The administration of Medicare D differs from that of Medicare A and B. For Medicare A and B, the Centers for Medicare and Medicaid Services (CMS) contract with insurance companies to administer claims on behalf of CMS and clients are contacted by mail. In contrast, Medicare D will be administered by federally-selected insurance companies that vary from state-to-state and which can offer multiple plans and directly contact potential clients.

Consumer and Medicare groups have expressed concern that consumers will be overwhelmed by the plan choices and that the open season will be a high-pressured marketing blitz rather than an effort to genuinely educate seniors about Medicare D options. In addition, these groups caution that unscrupulous people might acquire bank account and Social Security information, or fees, under the guise of registering people for the new drug program, as has been the case with the discount drug card program.

Seniors need to be aware of what questions to ask about Medicare D options and how to protect themselves from identity theft and other fraudulent scams.

What should I think about when considering a Medicare D plan?

Am I required to sign up for Medicare D? No, it is a voluntary program.

Is my present drug coverage adequate? If you have an FEHBP plan with drug coverage, it generally would not make sense to add a Medicare D prescription drug plan. The insurer that provides your current drug benefit will send you a letter this month explaining whether your coverage is as good, or better, than Medicare D. This is called a letter of "creditable" coverage; keep this for your records.

Will a plan cover my prescription needs? After taking an inventory of the drugs you are taking, find out if these drugs are on the plan's "formulary" or list of drugs covered by the policy, what conditions they are covered under and whether you will have to get prior approval to have the drugs paid for. Check with your doctor to see if there are suitable generic alternatives to the drugs you are taking.

Will I save money with Medicare D? This will depend upon your particular circumstances, the number of prescriptions you have, your income level and the kind of drug coverage you already have. If you are low income without any other drug coverage, Medicare D may be a good choice. As a general matter, remember when looking at premiums costs that a low premium might mean higher co-payments and more limited coverage of drugs.

Will I be able to use my regular pharmacy to fill my prescriptions? Ask if your regular pharmacy is in the plan's network and, if so, if it is a preferred or non-preferred pharmacy. Preferred pharmacies offer larger discounts.

What resources can I turn to for assistance? By mid-October CMS will add an online tool to help seniors compare plan benefits side by side, permitting them to take into consideration their specific drug needs and the pharmacies they prefer. Get someone to help you understand the Medicare D information sent to you. Check out Medicare D companies with Medicare at 1 (800) 633-4227 or www.medicare.gov.

How can I protect myself from senior scams?

• Register for the national Do-Not-Call registry at 1(888)382-1222. Medicare D plans cannot call you if your home telephone and cell phones are on this registry.
• Do not give out any personal information, particularly your bank account or Social Security number, over the telephone.
• Demand written materials from telephone solicitors.
• Remember, you can hang up on telemarketers.
• Do not allow anyone you do not know and have not invited into your home.
• Do not allow yourself to be pressured into a quick decision. Medicare D plans cannot sign up seniors before November 15.
• Check out Medicare D companies with Medicare at 1 (800) 633-4227 or at www.medicare.gov.
• Do not pay any money to apply for a plan. Medicare D plans may not require an application fee.
• If you become apprehensive about a caller or telephone solicitor, call your local police.

Medicare Part A, which is hospital insurance, helps pay for inpatient hospital care, skilled nursing facility care, and home health and hospice care. Medicare Part B, which is medical insurance, helps pay for doctors' services, outpatient hospital services, diagnostic tests and other medical services and supplies. The new Medicare D, which is prescription drug insurance, provides prescription drug benefits.