The following information is adapted from the Introductory Tool Kit provided to pharmacists on the Medicare Prescription Drug Benefit by Ortho-McNeil Pharmaceutical, Inc., Ortho-McNeil Neurologists, Inc., and Janssen, L.P. Please ask your pharmacist about FREE informational sessions regarding the new Medicare drug prescription benefit, and how the plan will affect you personally.

On December 8, 2003, President Bush signed into law the Medicare Modernization Act (MMA), a law that helps Medicare beneficiaries with the cost of prescription drugs. This law includes a prescription drug benefit, known as “Medicare Part D.” Part D may help lower out-of-pocket expenditures for prescriptions.

Medicare Part D: What is It?

Everyone with Medicare is eligible to sign up for a Medicare prescription drug plan, which will cover many brand name and generic prescription drugs at participating pharmacies.

Medicare prescription drug coverage is insurance provided by participating companies. There are two kinds of plans:

1. Prescription Drugs Plans (PDP). This plan only covers Medicare prescription drugs and is used along with traditional Medicare benefits.
2. Medicare Advantage Prescription Drug Plans (MA-PD). This plan covers expenses for doctor visit, hospital stays, and drugs administered by physicians, as well as prescription drugs.

Medicare beneficiaries will have to pay some costs to receive this new prescription coverage, including a monthly premium, a yearly deductible, and a portion of each prescription’s cost.

Medicare Part D: How Much Does it Cost?

As with any insurance plan, costs vary depending on which plan is chosen.

• Monthly Premium: The monthly premium is expected to be about $32
• Yearly Deductible: $250
• Drug Costs: Subscribers pay a share of the drug prescription costs

Drug Costs Breakdown

There are three basic “tiers” for costs. In each tier, subscribers will pay a different percentage of prescription drug costs.

1. Up to $2,250, the Medicare beneficiary will pay 25 percent of all drug prescription costs. If a prescription is $100, beneficiaries will pay $25, and Medicare will pay $75.
2. After $2,250 in prescription costs, the beneficiary will pay 100 percent of all prescription costs for the next $2850 in prescription costs (so from $2,250 in costs to $5100). This is known as the “coverage gap.”  The good thing is that Medicare beneficiaries will have access to discounted prices for prescriptions (based on Medicare negotiations with drug companies) during this time. 
3. After beneficiaries have reached $5,100 in drug prescription costs, the plan will pay 95 percent of the remaining costs for prescriptions that year.

What Drugs are Covered

Each plan is required to have all, or almost all, of the drugs in the six “classes” of drugs. These six classes include:

• Antidepressants
• Antipsychotic
• Anticonvulsants
• HIV/AIDs drugs
• Immunosuppressants
• Anti-cancer drugs

To check whether a specific drug is covered, ask a pharmacist or contact Medicare at 800-633-4227; TTY 877-486-2048.

Many pharmacies are offering free informational sessions on Medicare Part D. Attending one of these sessions can help in the choice of an appropriate plan.

What Drugs are NOT Covered

• Benzodiazepines
• Barbiturates
• Nonprescription drugs*
• Prescription vitamins and mineral products, except prenatal vitamins and fluoride preparations
• Agents used for symptomatic relief of cough and colds
• Agents used for cosmetic purposes or hair growth
• Agents used to promote fertility
• Agents used for anorexia, weight loss, or weight gain
• Outpatient drugs for which the drug manufacturer seeks to require that associated tests or monitoring services be purchased exclusively from the manufacture or its designee as a condition of the sale
• Any drug for which, as prescribed and dispensed and administered to an individual, would be paid under Medicare Parts A or B

*Plans will be permitted to use certain over-the-counter (OTC) drugs as part of step therapy. The cost of the OTC drug will be borne under that Plan’s administrative costs.

Enrollment

If a beneficiary has Medicare Part A (Hospital Insurance), and/or Medicare Part B (Medical Insurance), the beneficiary may join a Medicare prescription drug plan.

The initial sign-up period lasts from November 15, 2005, to May 15, 2006. After this initial period, a beneficiary may sign up or change plans only once a year between November 15 and December 31, unless they are eligible for a special enrollment period.

If a beneficiary signs up by December 31, 2005, his or her coverage will begin on January 1, 2006. If a beneficiary signs up after December 31, 2005, his or her coverage will begin on the first day of the month after the month they join.

Enrollment is entirely optional.

Please visit www.medicare.gov for more information.

Help with Costs

Some people may be eligible for help with drug prescription coverage plans.

• Group 1: People with incomes at or below the poverty level (currently $798 per month for a single person and $1070 a month for a married couple, in 2005).Beneficiaries don’t pay a monthly premium or a yearly deductible. They have small co-payments of $1 for generic drugs, and $3 for brand-name drugs. If the low-income assistance plus these costs is more than $3,600, they will not have to pay any more costs for the rest of the year.
  
• Group 2: People who are below 135 percent of the poverty level ($1077 for a single person per month, and $1444 per month for a couple in 2005; resources cannot be greater than $7500 for a single person or $12,000 for a married couple). Beneficiaries don’t pay a monthly premium or a yearly deductible. They pay $2 for generic drugs and $5 for brand-name drugs. If the low-income assistance plus these costs is more than $3,600, they will not have to pay any more costs for the rest of the year.
• Group 3: People with incomes below 150 percent of the poverty level; ($1,197 per month for a single person, $1604 a month for a couple in 2005; resources may be no greater than $11,500 for an individual or $23,000 for a married couple). The monthly premium is based on income, and the annual deductible is $50 a year instead of $250 a year. They are responsible for 15 percent of all prescription costs up to $3,360. Once these payments reach the maximum, they pay $2 for generic drugs and $5 for brand-name drugs.

Some state Pharmacy Assistance Programs may provide extra help with drug plan costs for members who sign up for the Medicare prescription drug coverage. Contact the state program for more information, or ask a pharmacist.

Important Dates

November 15, 2005 This is the first day Medicare beneficiaries may enroll in the new prescription program.

January 1, 2006 Medicare drug prescription coverage begins for those who signed up by December 31, 2005.

May 15, 2006 Last day (until November 2006) for beneficiaries to enroll in the new prescription drug program. Premiums may be higher in November, so sign up now!

Resources

More information on Medicare is available online from the following Websites:

• www.medicare.gov
• www.ssa.gov
• www.cms.hhs.gov
• www.medicarerxeducation.org
• www.kff.org

For more information about Medicare and other programs specific to seniors, please go to AARP, or call:

1. Medicare 800-633-4227; TTY 877-486-2048
2. Social Security Administration 800-772-1213; TTY 800-325-0778