Medicare Weekly News for September 13, 2005
Medicare Agency Says Look for Important Letter in the Mail
Letters Compare Current Drug Coverage to What Medicare Will Offer
People in Medicare with prescription drug coverage through a former employer or union will begin getting letters this
month that compare their current drug coverage to Medicare’s. The letters were originally scheduled to begin going
out next month, but the Centers for Medicare & Medicaid Services has been encouraging employers and unions to
step up efforts and begin sending out the letters in September. Retirees are being urged to begin checking their mail
The letters state whether the employer/union-sponsored drug coverage is comparable or better than (“creditable
coverage”), or not as generous, as Medicare’s new drug coverage. The comparison will simplify the enrollment
decision for the third of Medicare’s 42 million beneficiaries with prescription drug coverage through an employer or
union retiree health insurance plan.
These beneficiaries are advised to remain with their current plan if its drug coverage is as good as or better than
Otherwise, they may consider signing up for Medicare’s. (No late enrollment fee will be applied if they sign up during
the Nov. 15, 2005, - May 15, 2006, enrollment period.)
Also, no post-open enrollment late fee is applied if an employer or union discontinues its Medicare-comparable drug
coverage and the beneficiary signs up for Medicare’s within 63 days. Retirees need not be concerned, however,
because Medicare is giving employers and unions an incentive (28 cents on every drug-cost dollar) to continue
offering drug coverage.
Everyone in Medicare is eligible to sign up for the new prescription drug program. The Medicare agency recently
announced that the average monthly premium has fallen to $32.20 (down from $37), and that insurers all over the
country will be offering plans with monthly premiums of $20 per month or less.
The Medicare Rx Education Network provides information and assistance with outreach and enrollment for the new
Medicare Part D prescription drug benefit. The network, which includes 70 national organizations, is chaired by former
U.S. Senator John Breaux. Members share an interest in educating Medicare beneficiaries about the new Medicare
prescription drug benefit and work closely with the appropriate federal agencies to obtain up-to-date information to
ensure that information disseminated by the network about Medicare Part D is factual and accurately conveyed,
thereby pre-empting confusion about the benefit and equipping beneficiaries and their caregivers to make informed
choices. By sharing information with each other about member organizations’ independent efforts, collaborating on
activities, and identifying ways to work together, the network aims to eliminate duplication of efforts and maximize the
effectiveness of outreach efforts. The network does not engage in legislative activities or take positions on pending
legislative or administrative policies related to the Part D benefit and its implementation.