By Mary Johnson
"Why would Congress create a drug benefit like this?"  That’s the question being asked by Irene, one of my dearest, life-long neighbors, and a whole lot more of you that we’re hearing from.  Last fall, Irene, like hundreds of thousands of other seniors, received notice that her older Medigap drug coverage would end effective December 31, 2005.  She was told to replace it with a new Medicare Part D drug plan. 

That’s easier said than done.  Without a computer and Internet access, it was virtually impossible for Irene to make an informed decision.   Although she could call 1-800-MEDICARE, the program is very complicated, and I was concerned that Irene, with her hearing problems, would quickly be totally lost.  "It’s so confusing!" she kept telling me.  

I agree.  So I volunteered to help.

Seniors have until May 15, 2006 to enroll in a new Medicare Part D drug plan to avoid penalty for late enrollment.  But Irene (and many others) needed to replace existing drug coverage with new Part D coverage effective January 1, 2006.  Instead of having six months to enroll, she had only six weeks, starting November 15th, 2005.  Six weeks that land smack dab in the middle of Thanksgiving and Christmas.  Knowing how busy Irene would be with the holiday church bazaar, I didn’t waste any time.

In order to help Irene, I first needed the following information:

• The portion of her former Medigap premium that she paid in 2005 attributable to drug coverage.  That worked out to be $165 per month or $1,980 per year.
• A complete list of every drug, dosages, and quantity used per month.
• Her drug costs.  I learned Irene is very savvy.  She ordered a 120-day supply three times a year through a mail-order pharmacy— one of the best ways to get the biggest savings.  Her prescription co-payment costs came to $300 per year.  Altogether, her premiums and drug co-pays came to $2,280, averaging $190 per month in 2005.

I started to work on Irene’s request two weeks prior to the November 15th start of initial enrollment.  Medicare’s much-touted "Drug Plan Finder" Internet database was still not fully operational, only lurching into slow operation about a week later.  Nevertheless, after hours of laboriously printing out and matching up the information that was available, then doing my own cost estimates, I was able to narrow down Irene’s choices from 45 plans to 2 or 3.  A week later I was able to check the accuracy of my cost estimates when the "Drug Plan Finder" was operational.  (I was very close.)

The Medicare Drug Plan Finder database found at www.medicare.gov is virtually the only tool seniors now have to compare drug plans.  Without the Drug Plan Finder’s customized list that compares drug plans and the costs of the drugs you take, you could wind up spending far more for your coverage than you need to.  Including premiums and deductibles, Irene’s drug plan choices ranged from $3,119 to $1,035 per year for the same three drugs! 

Irene was happy to learn the lowest priced plan was through the very same mail order pharmacy that handled her prescriptions in 2005.  Irene should be able to save about $1,244 in 2006, barring any changes.  If the new drug plan works as anticipated, Irene will pay about $385.08 this year in premiums, a $250 deductible, and $399.92 in drug co-pays, a total of $1,035, or an average cost of about $86.25 per month.

Knowing the potential for error and that information could change, I confirmed Medicare’s information by visiting the drug plans’ web sites.  There I was able to get actual cost quotes, either by downloading the plan formulary or by using online calculators.  I also was able to print out enrollment forms.

Bottom line:  Irene and I are massively relieved to get through this stunningly complicated ordeal.  We think the program could hold promise, but it’s far too complicated.  Without knowledgeable one-on-one assistance, and internet access to the Medicare web site, a lot of seniors will wind up spending far more than they need to.  If you don’t have Internet access, call your Area Agency on Aging, listed in your phone book, and ask for free one-on-one insurance counseling. 

In the meantime, Irene isn’t counting her savings until she sees them on her bank statements.  She promised to keep us updated on how the whole thing works.  Irene says she just hopes someone else will benefit from her experience.  I do, too.

December 2005