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Great set of Definitions for Part D Prescription Drug Plan.

DP FITCH
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Tackling Medicare Part D Insurance Lingo
December 19th 2005

Part D is an insurance policy; it is purchased from an insurance company, pure and simple! Although the government created the guidelines of the plan and pays the insurer about three times the amount that you pay, insurers are to follow the minimum rules or their actuarially equivalent.

Here are the terms that you need to understand. These terms may not be included in all plans, but many.

Insurer: The insurance companies that you will purchase your prescription drug plan from.

Formulary: A listing of the drugs covered by your insurance plan.

Co-Brand: Many insurance companies are using the plans of major health-specific insurers. So, this term just means other entities or companies that market the same plan.

Co-Pay: The fixed dollar amount that that you will pay for a prescription. Example (EX): $10 per a supply of a prescription.

Co-Insurance: Your share of the cost of a prescription, in the expression of a percentage of cost. EX: 32% per prescription.

Supplies of prescriptions: Depending on the insurer, a monthly supply may be considered 30 or 31 days. A multiple supply simply will be multiplied by the allotted number of months of said supply; the maximum is usually three times what is considered monthly: EX: A three-month supply of the above co-pay would be $30; the above co-insurance would be 32% of a three month supply.

Tiers: Are levels of cost for different drugs, depending upon the insurers formulary. When you purchase a policy, your monthly price is indicated, tiers do not affect this premium, you are included in all tiers. EX: A plan may offer drugs in tier 1 for $6 co-pay per monthly supply. Commonly, these are generic drugs. Tier 2 drugs may have a co-pay of $30; these usually are brand names and sometimes referred to as preferred brands. Tier 3 drugs might have a co-pay of $60; these usually are higher priced brand names and sometimes referred to as a non-preferred brand. Tier 4 might have a cost of 32% co-insurance; these may be referred to as specialty brands.

NOTE: Not all plans have 4 tiers. Most have fewer. I have seen as many as five or the insurer may have created a different cost of drug outline that may be referred to a generic, preferred brand and non-preferred brand, and or specialty brand. And others may simply express your cost of drug levels in co-insurance percentages. Most companies work with the tier method, but not all.

TOTAL OUT OF POCKET COST: It is difficult for those buying insurance policies to comprehend this category, but stay with me and hopefully it will become clear. Let us assume that one is insured to cover the first dollar to a total of $2,250 of prescription drug cost. This simply means that your insurer is paying this total amount, including the $250 deductible, for a calendar-year period. What most people don’t understand is that the total amount of the cost of the prescription is applied to your allotted amount. EX: Using the above figures, let us say you have a co-pay of $10 for drug A, and another drug that has a co-insurance of 32 percent for drug B. We shall assume that the retail price of A is $25 and B is $100. You would pay $10 for A and $32 for B. So, how much is deducted from your total? If you think $42, you would be wrong. The entire “retail” cost of the drugs, $125, will be deducted from your “pool of money,” or $2,250. Some insurers, but not many will pass their pre-negotiated pharmacy discounts to you.

STEP THERAPY: is a term used by some insurance companies, its meaning: If you are taking a certain drug or drugs, the insurer has the right to request that you attempt to use a different drug that treats the same medical condition, before it covers the drug that you requested.

Example: If Drug A and B both have the same benefits for your medical condition, you may be asked to take Drug B first. If Drug B does not provide you with the same medicinal benefit, then the insurer will allow you Drug A, your initially requested drug. Remember, always work closely with your physician, and make sure that he or she is aware of this request from the insurer.

QUANTITY LIMITS (QL): Many insurers will limit the amount of certain drugs that will be dispensed.

PRIOR AUTHORIZATION (PA): Many insurers will require that certain drugs need PA, if approval, by the insurer is not accepted, the drug will not be covered.

NOTE: Some insurers may require both PA and QA for certain drugs. You can always ask for a QL waiver; in fact, you may request a drug that is not within the insurers formulary, key word request.

PREFERRED PHARMACY: Most insurers will include a list of pharmacies that they “prefer” you to use.

NON-PREFERRED PHARMACY: A list of pharmacies that the insurer request that you do not use. In fact, if you do, you will usually have to pay an additional cost above your co-payment or co-insurance amount. Some exceptions apply, check with your plan.

NOTE: PPs and NPPs are sometimes referred to as in-network and out-of network.

Medicare Part D confusion seems to be the rule rather the exception and it does not need to be that way way about how to pay for the plans. You are probably able to be qualified for the subsidies and you don’t it. Check out the rules.

DID YOU HEAR? Confused by Medicare Part D? Answers are available

By T&D Staff
Wednesday, December 21, 2005

For senior citizens already baffled by the federal government’s confusing Medicare Part D Prescription Drug Benefit Program, the commonly given advice to check out information on the Internet doesn’t offer much help.

The Orangeburg County Council on Aging, however, will provide the necessary information, free of charge, for the non-computer savvy.

Sheryl Cartwright, the council’s director, says that people who want assistance or who have questions should contact her agency for an appointment.

“We’ll sit down with them. They need to bring a list of their medications,” she said. “We’ll put this information in … there are 40 to 60 different plans available in South Carolina … and it gives the one most cost-effective.”

Actually, several options will be given, considering deductibles and co-pay. The first one listed will be the most cost-effective.

So far, Cartwright says, about 25 people have taken advantage of the service. But, with a limited budget, Cartwright says her agency has not been able to do much advertising.

“As people are hearing about it, they’re coming forward,” she said.

For those who are computer literate, or who have assistance with computers at home, the Web site www.medicare.gov will also be of help.

“If someone can sit down with a parent, that will help a lot of people,” Cartwright said.

The new federal drug program kicks off Jan. 1, with the sign-up period ongoing until May 15.

According to the federal law, whoever does not sign up with a plan by May 15 will be penalized, Cartwright says.

“If they don’t, they’ll be penalized forever by a percentage of the premium,” she said. “This is crazy!”

There is plenty of time to make a good decision. Actually you have until May 15, 2006 to get in on this open enrollment period.

Don’t forget to check out the opportunities that you have for assistance to pay for the Part Drug Plans. Don’t eliminate yourself by looking only at the published limits, there is more to it than meets the eye.

DP FITCH

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Press Release Source: Blue Cross and Blue Shield of Minnesota

Medicare Part D Coverage Begins January 1
Tuesday December 20, 3:42 pm ET
Minnesota Seniors in a Position to Take Advantage of Increased Coverage, Savings

EAGAN, Minn., Dec. 20 /PRNewswire/ — Perhaps the most valuable gift some people can give their loved ones this holiday season is help understanding the new Medicare prescription drug program and encouragement to sign up for it. The good news amid some of the confusion about Part D is that there is still time to get good information and make a decision about enrolling in a Part D plan with coverage for prescription drugs beginning January 1, 2006.

Medicare Part D offers prescription drug coverage for all Medicare members, regardless of income or existing health conditions. Because of the government subsidy built into Part D, seniors are able to get more prescription drug coverage at a lower price than many are currently paying. In addition, there are a variety of Part D plan choices available to Medicare members that are tailored to meet all levels of income and health care needs. The anticipated benefits have led tens of thousands Minnesota seniors to enroll in Blue Cross Part D plans this year, so they can start taking advantage of the costs savings right away in 2006.

In a recent survey conducted by Blue Cross and Blue Shield of Minnesota, nearly one in four Minnesotans over age 65 said they now spend more than $100 a month in out-of-pocket prescription drug costs. These and other findings in the Blue Cross survey indicate that Minnesotans are poised to take great advantage of what Part D can offer in savings, coverage and peace of mind.

“Minnesota seniors are spending too much on prescription drugs, but they have an opportunity to start saving soon if they enroll in a Part D plan before the end of the year,” said Deborah Madson, vice president for government programs at Blue Cross. “This might seem like an overwhelming decision and getting help from a family member or friend can help eliminate the confusion so people can enroll in a prescription drug plan that will best meet their needs and start showing benefits in the very near future.”

For Part D coverage beginning January 1, 2006, seniors must enroll by December 31, 2005. There are a number of ways family members and friends can assist a loved one in deciding about a Part D plan, including confirming the type of prescription drug coverage they currently have, creating a list of prescription drugs they take, helping navigate the official Medicare Web site to evaluate available plans or placing a call to the Minnesota Senior Linkage Line. If people are not ready to sign up for a Part D plan before the end of the year, they still have time to sign up before May 15, 2006 to avoid the government-imposed penalty.

The official Medicare Web site — http://www.Medicare.gov — features information about Part D plan options, how to enroll and tools to help seniors calculate their monthly drug expenses. Medicare also offers personalized assistance over the phone 24 hours a day, 7 days a week at 1-800-Medicare (1-800-633-4227) or TTY/TDD at 1-877-486-2048. The Minnesota Senior LinkAge Line is at 1-800-333-2433.

In addition to government resources, many private health plans are offering meetings where seniors can get one-on-one attention and answers to their questions. Nearly 7,000 Minnesotans have already attended Be Medicare Aware meetings hosted by Blue Cross.

“The overwhelming response to the Be Medicare Aware forums is evidence of the interest and the questions seniors have about Part D,” said Deborah Madson, vice president for government programs at Blue Cross. Blue Cross has also created a special Web site — http://www.YourMedicareSolutions.com — to help Minnesotans get the information they need to make a decision about Part D.

Only 41 percent of 60-64 year olds in Minnesota feel confident about being able to afford their health care expenses in five years, according to the Blue Cross study. With the cost of prescription drugs — and the increasing role they play in health care regimens — Medicare Part D offers a way for Minnesota seniors to take back some control over their health and their pocketbooks.

Blue Cross and Blue Shield of Minnesota, with headquarters in the St. Paul suburb of Eagan, was chartered in 1933 as Minnesota’s first health plan and continues to carry out its charter mission today: to promote a wider, more economical and timely availability of health services for the people of Minnesota. A not-for-profit, taxable organization, Blue Cross is the largest health plan based in Minnesota, covering 2.6 million members in Minnesota and nationally through its health plans or plans administered by its affiliated companies. Blue Cross and Blue Shield of Minnesota is an independent licensee of the Blue Cross and Blue Shield Association, headquartered in Chicago. Go to http://www.bluecrossmn.com to learn more about Blue Cross and Blue Shield of Minnesota.