Sign-up deadline nears for drug plan

Counselor Cindee Boaz helps Jean Shipp of Far Rockaway, N.Y., and her mother, Laura Gary of Toledo, get information.

A little more than a month ago, Doris McCoy and Vanessa Neyland smiled for the TV cameras and said they were grateful for Medicare's new prescription-drug program.

The two had gone to the J. Frank Troy Senior Center just west of downtown Toledo to learn more about it. They were surprised to see Michael Leavitt, secretary of the U.S. Department of Health and Human Services, the agency that oversees Medicare.

He was visiting Toledo as part of a nationwide bus tour aimed at encouraging seniors to sign up for the program. Mr. Leavitt singled out the two women as examples of how the program is a boon to seniors and chatted with them in front of cameras.

Today, the two women still speak highly of Medicare. Sort of.

Ms. McCoy has been using the new program about a month now, and she's pleased. A medication that previously cost her $125 a month now costs $16.

"I'd encourage people to look into it," she said.

That's exactly the message the federal government wants senior citizens to hear, a message that is taking on urgency because the deadline to sign up for the program is fast approaching. Those eligible for Medicare must sign up by May 15 in order to avoid paying a penalty if they sign up after that deadline.

But the experience of Ms. Neyland might explain why some seniors are reluctant to embrace a program many criticize as being far too complex.

Ms. Neyland takes care of her 91-year-old mother, and as her mother's caretaker she spent weeks researching which of the dozens of drug plans offered by Medicare was right for her mother. She chose the wrong one. Since visiting the senior center last month, she has spent more time trying to cancel her mother's application for her original drug plan and get her moved to another. It's a process that's required her to place more than 10 phone calls and answer three letters from insurance companies.

"If this works out, I'll compliment them," she said. "But it's too complicated. Seniors won't go out there and compare programs like I did."

Senior advocates say they realize the process is complicated, but most are urging seniors to at least make a call or two and ask some questions. Don't miss a chance to save money on prescription drugs, they argue, and especially don't risk paying a penalty by signing up after May 15.

"We're trying to make sure people understand there's a deadline," said Kathy Keller, spokesman for AARP Ohio.

Ann Womer Benjamin, director of the Ohio Department of Insurance, also urges seniors to research the program - even those who looked into it previously and decided against it.

"If you think you have good coverage already [through a former employer, union, or other arrangement], find the letter that was sent to you or contact your union or health plan or employer and make sure you really do," she said. "If you don't, do your shopping right now."

Ms. Womer Benjamin said she's been pleased so far with the response in Ohio, though there's clearly room for improvement.

As of April 18, the last date when Medicare released numbers, 1.3 million Ohioans were either enrolled or receiving some sort of financial help from the new Medicare drug program. With about 1.8 million eligible Ohioans, that leaves about 500,000 who have yet to decide.

Looking more closely at the 1.3 million total, it's apparent that the number of people who sought out the program and signed up is rather small.

For example, 513,953 signed up on their own for a drug plan or Medicare HMO plan that offers drug coverage. But Medicare officials count the remaining 792,844 people: Either they were automatically enrolled because they were on Medicaid or they stuck with coverage through a former employer or union. Those coverage plans receive a subsidy from Medicare to continue coverage, so Medicare counts them. A smaller number of federal retirees are counted too.

Many seniors have complained about the large number of plans offering Medicare drug coverage. That problem eventually may disappear, perhaps as soon as next year, according to Gary Panek, who manages Ohio's Golden Buckeye program, a state senior-citizen discount program. Mr. Panek said the field will "be a lot less crowded next year" as companies drop out after deciding they didn't sign up enough people to make money or for some other reason.

Don't worry, though, if you're in one of those plans. The company still has to provide you with coverage until the end of the enrollment year.

As for the May 15 deadline, many critics - including some in Congress - have suggested doing away with the deadline, or as Ms. Womer Benjamin suggests, possibly extending it. However, that appears unlikely.

Mr. Panek said the bigger issue politicians will face this fall is the so-called "doughnut hole." Many seniors who signed up are already entering that hole, meaning they're on the hook for much higher drug costs.

"What will be interesting is a lot of people will be in the doughnut hole this fall and be back to paying for all their drugs," he said. "It will be interesting to see how that gets spun at election time."

What hole, you ask?

Under a Medicare drug plan, a senior typically pays up to a $250 annual deductible toward the cost of his or her drugs. After that, the plan will cover 75 percent, or $1,500, of the next $2,000 in drug costs, and the senior will pay the remaining 25 percent or $500. This is when the "gap" or "doughnut hole" in coverage begins. For the next $2,850 in drug costs, Medicare pays nothing and the senior pays all of those expenses. Once the senior has spent a total $3,600 - the $250 deductible, the $500 in 25 percent payments, and the $2,850 direct payments for drug costs - the Medicare plan kicks in again. After this point, Medicare - through the plan picked - pays up to 95 percent of remaining drug costs. The senior will pay a small co-pay ($5 for brand-name drugs) or 5 percent of the cost of each prescription, whichever amount is higher.

Cindy Meyers, a social worker at Northgate, a senior-citizen apartment complex in Toledo, said things have improved dramatically since January. Pharmacists have been easily filling most prescriptions of that facility's seniors who have signed up for a drug plan. One problem has been those on Medicaid who were automatically enrolled in a plan but decided to switch. For some reason, it's taking some time to make that switch and resulting in some seniors mistakenly being billed by two companies instead of one.

Some critics of the drug program are skeptical that things really are getting better.

Deane Beebe, communications director for the New York-based Medicare Rights Center, a nonprofit advocacy group, said her organization has been flooded with calls from seniors who have discovered lots of red-tape requirements in their plans: verification from a physician that the drug is necessary, directives to try another drug first before getting the one they want, and limits on the quantity of drugs dispensed.

"Some people are getting some help, and they're the lucky ones," she said.

The latest evidence of problems occurred last week when undercover federal investigators with the Government Accountability Office called the Medicare hot line and operators gave them inaccurate information a third of the time.

There is one thing critics and supporters of the Medicare drug plan agree upon: Despite the enormous amount of attention from the media, senior advocates, and others about the changes, some seniors still are unaware of the drug plan - or the May 15 deadline.

"I had someone just last week, who despite all the newspaper stuff and flyers I sent out, had never heard of it," Ms. Meyers said. "They said, 'Oh, there's been a change?' "

Contact Luke Shockman at: lshockman@theblade.com or 419-724-6084.