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Medicare Part D and The Local Choice Health Benefits Program

Medicare Part D and The Local Choice Health Benefits Program. Prescription Drug Options for January 1, 2006. What’s Happening?. Effective January 1, 2006, Medicare Will Offer a Prescription Drug Benefit (Part D) Sign Up between Nov. 15 th and May 15 th without penalty.

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Medicare Part D and The Local Choice Health Benefits Program

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  1. Medicare Part D and The Local Choice Health Benefits Program Prescription Drug Options for January 1, 2006

  2. What’s Happening? • Effective January 1, 2006, Medicare Will Offer a Prescription Drug Benefit (Part D) • Sign Up between Nov. 15th and May 15th without penalty. • TLC Rx Benefits End 1/1/2006

  3. Surveys Indicate… Most participants: • Are Aware of Medicare Part D • But Have Minimal Knowledge of the Part D Benefit • Do Not Understand the Value of Part D • Are Concerned about the impact of Part D on their Health Plan Coverage

  4. Medicare Part D – The Standard Benefit

  5. Actual Drug Cost

  6. Part D Concerns • Formulary • Non-covered classes of drugs • Deductible • “Donut” hole

  7. The Good News • Potential for Significantly Lower Premium • Option to Elect Medical-Only Coverage under TLC with PDP of your choice • More Flexibility - Choices Based on your individual Needs • Premium Savings will help to pay for possible non-covered drugs

  8. The Bad News • Formulary • Non-covered classes of drugs

  9. Protections – Formulary Restrictions • At least two drugs in each therapeutic category and class • Notification requirements before formulary deletions • Exceptions process • Appeals process

  10. What Drugs Are Excluded?In Medicare D • Drugs for anorexia, weight loss or weight gain • Drugs used to promote fertility • Drugs used for cosmetic purposes • Drugs for symptomatic relief of cough and colds • Prescription vitamins and mineral products • Non-prescription drugs • Barbiturates (Phenobarbital, Seconal – sedatives prescribed for anxiety and insomnia) • Benzodiazepines (Ativan, Valium, Xanax – CNS Depressants))

  11. TLC Had 3 Choices • Do Nothing • Apply for Federal Subsidy • Eliminate Drug Coverage

  12. Pros Maintain Current Benefit Structure—No Formulary Retirees could Drop TLC Drug Coverage and Enroll in a Part D Plan Coverage is Creditable—No Penalty Cons Value of Medicare benefit is lost within the program (?COB) No premium savings Likely premium increase based on trend Adverse selection High co-payments TLC Choice: Do Nothing

  13. Pros Maintain Current Benefit Structure—No Formulary Retirees could Drop TLC Drug Coverage and Enroll in a Part D Plan Coverage is Creditable—No Penalty Cons No Savings to TLC No Savings to Retirees Continued Premium Increases High Co-payments Adverse Selection Administrative Costs Choice: Apply for Federal Subsidy

  14. Pros Standard Part D Benefits is Effective for Many Retirees Part D Average Premium is approximately $32.20/month Medical-only premium is Less than Half of Current Premium Cons Some Retirees (high cost/non-covered) could see Increased Cost Enrollment/Selection of Part D plan by Retirees Choice: Eliminate Drug Coverage

  15. Summary of Choices

  16. Why?(A Review of the “Pros”) • Best Application of Part D Value • Greatest Positive Impact on Premium • Potential for Significantly Lower Co-payments • Choice • Opt-out still Available • Choose Plan that Best Fits Needs

  17. Your TLC Plan Drug Costs Now • $200 per month in premium for 2005/$2,400 per year • Co-payments

  18. 2006 Premiums

  19. The Consensus The Greatest Value of the Medicare Part D Benefit is Realized for TLC Retirees by Eliminating Rx Coverage

  20. Retiree Choices • Keep Current Plan Coverage Without Prescription Drug Coverage (medical only) and Enroll in a Separate Medicare Part D Plan • Drop TLC Coverage and Enroll in another Medicare Supplemental or Medicare Advantage Plan

  21. New TLC Medical Only Plan Choices • NEW! – Medicare Complementary – (grandfathered) • NEW! – Advantage 65 • NEW! – Advantage 65 with Dental/Vision

  22. Tools Medicare Choices • Medicare & You 2006 • www.medicare.gov • 1-800-MEDICARE • 1-(800) 633-4227 • www.eldercare.gov • 1 (800) 677-1116 • Area Offices on Aging • www.vda.virginia.gov • State Health Insurance Assistance Program (SHIP) • (800) 552-3402

  23. What Will I Need? • Names of Drugs Currently Taking • Cost of Drugs (Not Just Co-Pay) • www.thelocalchoice.virginia.gov and click on: • Carrier Contacts • Medcohealth.com • Be sure to add “plan pays” and “you pay” • 41 PDPs and 26 Medicare Advantage Plans available in Virginia

  24. Determine What Matters Most to You • Cost • Coverage • Convenience

  25. Retiree Group To-Do List • Read Materials / Use Tools • Compare Options • Choose Coverage for 2006 • Remember: TLC Rx Coverage Ends 1/1/2006

  26. Questions

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