The Progress Center for Independent Living on Madison Street is one of three agencies in all of Cook County which have received funding to provide education and advocacy to seniors and people with disabilities regarding the Medicare Rx prescription drug program which will take effect on January 1, 2006.
Education is needed, according to Thanh Lu”Make Medicare Work Project Coordinator at the Progress Center”because the new prescription drug plan is complicated. Called Medicare Rx by the federal government, the basic plan looks like this:
Level One: Participant pays the first $250 of drug costs (deductible). Participant pays 25% of drug costs between $250 and $2250.
Level Two: Participant pays 100% of drug costs between $2250 and $5100.
Level Three: Participant pays 5% of drug costs over $5100.
A second layer of complexity is added by the decision to have the entire program be administered by private insurance companies. Lu explained that seniors and the disabled will have to sort through the products offered by more than one insurance provider, with each provider being able to design several plans with a variety of coverages and co-pays in exchange for higher premiums.
A third layer that complicates things for those needing help purchasing drugs is that Illinois has its own separate program for low-income residents who do not qualify for Medicare Rx. Known as Illinois CaresRx, the state plan was created by the legislature to “wrap around” the
Medicare Rx coverage and fill some of the gaps in the federal program.
To address the educational and advocacy needs of people eligible forMedicare, the Progress Center’s executive director, Diane Coleman, took part of the lead in forming a coalition with the West Suburban Area Agency on Aging and Health and Disability Advocates known as Make Medicare Work (www.makemedicarework.org).
This coalition of agencies that serve the disabled community joins the resources of agencies dealing with seniors. Funding for the coalition was received from the Michael Reese Health Trust, the Chicago Community Trust and The Retirement Research Foundation.
Lu said that the coalition helps ensure that those eligible for Medicare Rx realize that there is a definite time line that must be followed in order to participate. Step one is completing and sending in an application (referred to by Social Security as Extra Help).
Although 800,000 applications have already been sent out to people who might be eligible for Extra Help, inevitably some folks fall through the cracks or throw away the application, Lu said. Make Medicare Work is trying to reach out to this population.
Step two will involve each eligible person choosing whether they want to participate in the program. If they do, they need to decide which plan from which insurance company is best for them and enroll.
Lu said that when the plans are revealed on October 15, many seniors and disabled people will again need help in making those decisions.
Once Medicare RX goes into effect on the first of the year, those eligible will have until May 15 to join the program. After that date, Lu said that a 1% premium penalty for every month not on the plan will be assessed for life.
To qualify for Extra Help, people must earn less than 150% of the poverty line of $14,355 for a single person($21,533/year) and $19,245 for a couple($28,868/year), plus a single person cannot have more than $11,500 in liquid assets (excluding house and care) and a couple cannot have more than $23,000.
Lu said he is anxious to get the word out on Medicare Rx will be happy to schedule presentations with groups.
He can be reached at (708) 209-1500 or email@example.com.
Signed into law on December 8, 2003, the Medicare Modernization Act which created the Medicare Rx program marked the largest expansion of Medicare since 1965.
“Historically,” Coleman explained, “Medicare was not covering prescriptions except in narrow cases like hospice. For the first time, Medicare eligible people will be able to purchase drugs.”
Lu acknowledged that Medicare Rx may not benefit everyone. “For someone who is fairly healthy, this plan is expensive, because you have to pay a lot of money up front,” he said, “and then you have to pay an additional $35/month in premiums. If you use a lot of drugs, this program could help you out.”
The projected cost of Medicare RX over a ten year period, Lu said, is $800 billion.