Understanding Changes in Prescription Drug Coverage for People with Disabilities on Medicare

A project of Advancing Independence • November 2005

Jeffrey S. Crowley, Health Policy Institute, Georgetown University
with Bob Williams, Advancing Independence

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Action Steps for People with Disabilities

Many people with disabilities rely heavily on prescription drugs, and any thought of changing how they get their drugs can produce a great deal of anxiety. While the new Medicare Part D program is complicated, it is expected that nearly everybody will have drug coverage that is as comprehensive as they had before. And, if problems arise, there are often solutions.

To help simplify what Medicare beneficiaries with disabilities need to do to protect their own access to prescription drug coverage, we have developed the following five steps for success. We encourage all Medicare beneficiaries with disabilities to:

  1. Decide whether or not to participate in the Part D program;
  2. Ensure that they get all of the financial assistance for which they are eligible;
  3. Select a prescription drug plan that meets their needs;
  4. Keep a Health Care Journal; and,
  5. Advocate for themselves to get all of the drugs they need

1. Decide whether or not to participate in the Part D program

Essentially all Medicare beneficiaries with disabilities should enroll in the Part D program. The one exception is in the case of people who receive retiree health coverage from their former employer. In this case, they will have the option of retaining this coverage without penalty, as long as their retiree coverage is at least as comprehensive as coverage under the Part D program. In the fall of 2005, individuals with retiree coverage should receive a letter from their retiree plan that will tell them whether or not their coverage is comparable to Part D coverage.

While participating in the Part D prescription drug program is voluntary, the program’s structure is intended to lessen the cost for all beneficiaries by having all Medicare beneficiaries participate as soon as they become eligible for Medicare.

To prevent people from waiting to enroll in Part D until they need extensive prescription drugs, the program has substantial late enrollment penalties. As a general rule, the penalty is 1% of the premium per month that a person delays enrolling in these programs. Therefore, a one year delay results in premium surcharge of 12% and a five year delay results in a premium surcharge of 60%. Individuals are required to pay this late enrollment penalty for the rest of their lives—i.e. as long as they remain enrolled in the Medicare program. Additionally, individuals who delay enrollment can generally enroll only during the annual enrollment period.

2. Ensure that they get all of the financial assistance for which they are eligible

Once a decision has been made to enroll in the Part D program, the next critical step is to ensure that individuals obtain all of the financial assistance for which they qualify. This includes Extra Help, as well as Medicaid and the Medicare Savings Programs.

Extra Help: To apply for Extra Help individuals should contact the Social Security Administration or the Medicaid office. While Social Security will be set up to handle the large volume of Extra Help applications, if individuals apply through their Medicaid office, they should also be screened for Medicaid eligibility and for the Medicare Savings Programs.

To help individuals find their local Social Security office, go online to the Social security Office Locator (new window). Individuals can also call toll-free 1-800-772-1213. For people who are deaf or hard of hearing, the toll-free TTY line is 1-800-325-0778.

Since each state operates its own program, there is not a central number that everyone can call nationwide to get information about Medicaid in each state. Therefore, to get information individuals should call their state Medicaid agency. The number can be found by looking in the phone book in the State Government pages (often blue pages). Some states refer to Medicaid as “Medical Assistance”. In California, for example, Medicaid is called “Medi-Cal”.

Medicare Savings Programs (MSP): This program does not assist with prescription drug coverage, but pays Medicare Part B premiums, and depending on one’s income, also pays Medicare cost-sharing for expenses other than drugs (such as cost-sharing for a hospital stay). These programs are operated by state Medicaid programs and participants are called partial benefit dual eligibles.

MSP includes the Qualified Medicare Beneficiary (QMB) program, the Select Low-income Medicare Beneficiary (SLMB) program, and the Qualifying Individual (QI) program. These programs offer differing levels of assistance as individuals move up the income scale. The QMBs, who have income below the poverty level (monthly income of $797.50 for a single person in 2005) receive assistance with Medicare Parts A and B premiums and cost-sharing. SLMBs, persons with income from 100-120% of the poverty level (monthly income from $797.50 – $957 for a single individual in 2005) receive assistance with only the Part B premium ($88.50 per month in 2006). The QI program is not guaranteed to individuals. States received fixed grants from the federal government, and if participation is full individuals are turned away. Individuals who qualify have income from 120-135% of poverty (monthly income between $957 and $1,076.63 for a single individual in 2005) and participants also receive assistance with the Part B premium. Participants in the Medicare Savings Programs automatically qualify for Extra Help. To be screened for eligibility for the Medicare Savings Programs, individuals should contact their state Medicaid office.

3. Select a prescription drug plan that meets their needs

In order to ensure that dual eligibles will not experience interruptions in their drug coverage, they will be randomly assigned to a Part D plan even if they do not take any steps to enroll in the Part D program. They are receiving special treatment because they are the only group losing their current prescription drug coverage before the Part D program takes effect. Individuals who are assigned to a plan should clearly understand that this assignment was made on a random basis, and the specific plan in which they were enrolled may not meet their needs. These individuals may switch to another plan that may better meet their needs.

All Medicare beneficiaries with disabilities must do the homework to educate themselves and select a plan that meets their needs.

Selecting a plan that meets their needs is often a very personal decision. Some people may care more about certain factors than others. For example, Extra Help recipients may want to eliminate all plans that cost more than the regional average, otherwise they would be responsible for some of the premium costs. Others, however, may be focused on ensuring that their local pharmacy is in their plan’s network. Since the selection of a plan can be overwhelming for many people, a large number of people will need assistance with this decision.

Physicians can be an important source of information, although they will likely not be able to make an informed recommendation on what plan is best for an individual. However, physicians should be consulted to learn if an individual has flexibility in substituting other drugs for the ones they are currently taking, in case a certain drug is not on the formulary, or if the cost-sharing is prohibitively expensive.

Individuals will also have access to a wide range of information about plan options in their region. The first place that individuals should start in gathering information is Medicare. For persons with access to the Internet, this is perhaps the easiest way to get information. Go to http://www.medicare.gov (new window). In addition to basic information, there is a plan comparison tool where individuals can input information about themselves, and it will provide information about some of the plans that will meet their needs.

Within the Medicare.gov website, there is a Landscape of Local Plans page where individuals can find Medicare prescription drug plans by state or Medicare Advantage plans with prescription drug coverage by county. Individuals can see the plans in their area that offer drug coverage, including basic information to help identify the plans that meet an individual’s needs based on cost, coverage, and convenience.

Individuals who do not have internet access can call 1-800-MEDICARE (1-800-633-4227). For people who are deaf or hard of hearing, the toll-free TTY line is 1-877-486-2048.

The following is a list of some major questions that beneficiaries with disabilities and those that may assist them in selecting a plan might want to ask and answer in order to make an informed choice of plans:

Questions To Ask Your Physician

Before going to the doctor, individuals should make a list of all drugs they take, the dose of the drug they take (i.e. 20 mg.), and the frequency (2 times per day)

Questions for the doctor:

  • What is the purpose for taking each drug?
  • Are there alternative drugs that may be equally effective?
  • If a Part D plan or my pharmacist wants to substitute another drug for the drug prescribed, is this safe? Are there certain drugs that raise special concerns?

Questions To Answer Before Selecting A Plan

Does the individual have a preferred pharmacy? Is it in the plan’s network?

  • What prescription drugs does the person take?
  • For each drug, is the drug on the plan’s formulary?
    • If yes:
      • What is the cost-sharing for receiving the drug?
      • Is prior authorization required to receive the drug?
      • Are there quantity limits on the drugs that will be provided?
    • If no:
      • What drugs in the same class are on the formulary?
      • Ask your physician, if it is acceptable to substitute the on-formulary Drug
  • In managing the cost of Part D coverage, is a low premium plan a priority? Is this still important if the low premium plans charge higher cost-sharing?

For assistance in answering these questions, use the worksheets listed below the Table of Contents.

To enroll in a plan, individuals identify the plan they want, and they should contact the plan directly. If they do not know how to contact the plan, they can contact Medicare for this information.

4. Keep a Health Care Journal

In most cases, access to prescription drugs under the Part D program will not be problematic. There will be cases, however, where the plan may initially deny coverage for a drug because they do not believe the drug is medically necessary, the drug is not on the formulary, or because the plan believes a lower cost drug may be more appropriate. Some of these plan decisions are in the best interest of the individual. In other cases, however, individuals may need to request an exception to the plan’s normal coverage policy, or they may need to appeal a plan’s denial of a drug. In such a case, the prescribing physician is likely an individual’s best advocate in getting the plan to reconsider or getting the denial overturned. Individuals can also help bolster their case for needing a drug by supplementing their physician’s professional judgments with their own detailed health history.

Empowered health care consumers
should keep a Health Care Journal.

In a notebook, folder, or journal, individuals should keep track of all medications they take; when they visit the doctor, the purpose, and the outcome of the visit; as well as a log of symptoms…individuals should be encouraged to write down the dates of every time they get sick, feel depressed, or encounter other health problems, as well as how long the problem lasts. If a drug is working effectively it is important that this be noted as well.

5. Advocate for themselves to get all of the drugs they need

A new feature of the Medicare Part D program is the exceptions process. This is a process where an individual can request that a plan cover a drug at the lowest level of cost-sharing, even if the plan normally charges a higher level of cost-sharing for the drug. This process also creates an opportunity for an individual to obtain coverage for drugs that their plan has kept off the formulary. The exceptions process is intended to be an easier process than a formal appeal for requesting coverage for drugs. To request an exception, an individual needs the support of their treating physician, and the physician must state that the requested treatment is needed by the individual and less costly alternatives have not worked for the individual or are unsafe or inappropriate for the individual.

If an individual has gone through the exceptions process and has still been denied a prescribed drug that they need, they have a right to access the appeals process.

As a general rule, Part D plans must decide whether or not to approve the dispensing of a drug within 72 hours (24 hours for expedited requests). If an individual appeals a decision, plans must respond to a standard appeal within 7 days and they must respond to an expedited appeal within 24 hours; in all cases, however, plans must respond “as expeditiously as the enrollee’s health requires.”

If individuals are denied a drug and their health or safety is placed at risk by not having access to the drug, they should request an expedited appeal.

If an initial appeal is denied, there are several additional levels of review that can be pursued. This includes a right to have their request for a drug reviewed by an Administrative Law Judge, who is independent of the Part D plan. Once an individual has exhausted their appeals rights, they also can access the federal courts—although this process can take months or years and is not likely an option for resolving routine disputes over the coverage of drugs.

The first step in requesting an exception or an appeal is for the individual or their representative to contact their Part D plan and specifically state that they would like to request an exception (or appeal).

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This consumer guide was developed with financial support from the Pharmaceutical Research and Manufacturers of America (PhRMA). Copyright © 2005 by Advancing Independence. Permission to duplicate is granted and encouraged. Please acknowledge the source. Please direct questions to robert.willliams@gmail.com.