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Medicare's Prescription Drug Plan Enrollment Deadline Looms

Even those already in a plan need to reevaluate their coverage, experts say

WEDNESDAY, Dec. 27, 2006 (HealthDay News) -- The deadline for enrolling in or changing your Medicare prescription drug plan is fast approaching, and experts agree that you need to choose carefully because premiums have increased and drug coverage has changed in many plans.

"In terms of premium increases, 77 percent of drug plan enrollees are in plans where premiums will be increasing," said Larry Levitt, a vice president at the Kaiser Family Foundation. The deadline for picking a plan for 2007 is Dec. 31, and that decision can't be changed again until next November.

However, if a recent survey holds true, many seniors will simply stick with what they've got.

According to a report by the Kaiser Family Foundation and the Harvard University School of Public Health, only 5 percent of those currently enrolled in a Medicare prescription drug plan say they expect to switch plans for 2007. Overall, 76 percent of people enrolled in a plan say their experiences have been positive, and 46 percent say they have been "very positive." Fifty-two percent say they are saving money with their drug plan, while 14 percent say they are paying more.

On the downside, 23 percent say they have had a problem with the new benefit, and, for 12 percent, it was a major problem. In addition, 73 percent say the Medicare drug benefit is "too complicated," and 39 percent say there are too many plans offered.

One expert says that people planning to enroll in a drug plan need to evaluate all the plans to find the one that is best for them.

"If you are dealing with having to make a decision on a Medicare prescription drug plan, you have to use the computer to get to the drug plan finder," said Esther Koch, from Encore Management, a company that helps Medicare patients select plans. For seniors who are not computer-savvy, Koch recommends they get their children to help them.

The drug plan finder will estimate the total annual cost for each plan, including the premium, the deductible, the co-pay and the coinsurance, Koch said. "The plans are sorted from least expensive to most expensive," she said. "The finder will also tell you how your drug benefit will be covered in the 'donut hole.' "

The "donut hole" refers to a period when, after total drug costs reach $2,250, participants will pay an additional $2,850 out-of-pocket before Medicare Part D will continue coverage. This coverage gap is called the "donut hole." After this point, Medicare pays for 95 percent of drug costs, and participants would pay the remaining 5 percent.

To find the right plan, people need to contact Medicare or use the plan finder, said Deane Beebe, communications director at the Medicare Rights Center. "Once you find out which plan might be best, call the plan and verify all the information you got from Medicare before you enroll," she said. "What you see and hear from Medicare is not always consistent with what the plan is actually offering. You must double-check."

Koch also believes that people should review the plans annually and not just stay in the same plan. "The plans are going to change. The drugs are going to change," she said. "It's unfortunate that only 5 percent say they are going to change plans."

Some prescription drug plans did not inform Medicare beneficiaries of impending changes in their costs and benefits, as they were required to do, administration officials and Congressional aides said Tuesday, according to The New York Times.

Administration officials may give these beneficiaries a six-week extension of the open-enrollment period, which ends Sunday. Beneficiaries could use the extra time to compare the options that will be available to them in 2007. And, officials added, they may consider imposing penalties on companies that did not provide the necessary information to beneficiaries.

Beebe also thinks it is essential for current enrollees to look at their choices again and not automatically continue with their current plan.

"Anybody who signed up for a plan last year must take a close look to see if their current plan is likely to meet their needs in 2007," Beebe said. "No one is free of having to go back and sort this all out all over again. This is important because people are going to be locked into their plan until the end of 2007."

Beebe noted that although all the plans are supposed to notify people of changes, these changes are not always easy to understand. "It's a sad fact that people are not aware that plans are changing," she said.

Levitt also thinks that people currently enrolled in a plan should reevaluate it. "The plans change, and people's circumstances change, so it's not necessarily the right decision for everyone to stick with their plan," he said.

More information

Medicare can tell you more about prescription drug plans.

SOURCES: Esther Koch, Encore Management, San Mateo, Calif.; Larry Levitt, vice president, Kaiser Family Foundation, Menlo Park, Calif.; Deane Beebe, communications director, Medicare Rights Center, New York City; Dec. 19, 2006, Kaiser Family Foundation report, Voices of Beneficiaries: Medicare Part D Insights and Observations One Year Later
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