Navigating the Medicare Rx Discount Maze
Experts say go slow and ask questions before choosing your card.
WebMD Feature
Reviewed By Brunilda Nazario
The government is ready to roll out its new Medicare-approved prescription discount drug card program, offering seniors and other beneficiaries discounts on many of the medications they use. With dozens of prescription discount cards set to hit the market next month, almost every expert -- and even Medicare itself -- is warning that choosing the right card is going to be confusing.
A February poll by the Kaiser Family Foundation found that 68% of Medicare beneficiaries did not know that the bill authorizing the prescription drug discount card program had been signed into law, and that nearly as many did not understand what it contains.
What seniors can expect starting in April is a deluge of mailings and advertisements touting dozens of different prescription discount cards, offering savings on a range of prescription drugs.
'Don't Rush'
Experts say that eligible seniors and their families should avoid any urge to "act now" on any one card, and instead take the time to figure out which card is best for them. Medicare beneficiaries, except those enrolled in Medicaid drug coverage, can start enrolling May 1 with discounts kicking in June 1.
But each beneficiary is limited to one card, and you can't make a change until the re-enrollment period starts in November.
"Don't rush. You shouldn't succumb to pressure," says Elinor Ginzler, AARP's manager for independent living and long-term care.
First off, beware of fraud. Medicare now reports discount card scams in 11 states, up from six several weeks ago. Officials point out that Medicare's rules prevent legitimate card sponsors from making telephone solicitations, so if you get a call, ignore it.
Medicare wants beneficiaries to consult its web site, www.medicare.gov, or its (800) MEDICARE hotline for information. "If you have any questions at all, call the number and they'll tell you who's legit," a Medicare spokesman tells WebMD.
AARP and other advocacy groups are setting up resources to help seniors figure out which drugs they take and how much they pay for them (see below for details.) With that information on hand, seniors can go to the web site where the government plans to launch a price comparison program displaying different discount cards' negotiated prices and other features. Operators at (800) MEDICARE will also have access to the site.
But the site will only tell you the maximum price a pharmacy can ask with a particular card in a particular area.
"What we are showing is not the lowest price you are paying with a card but what the highest price can be. That could end up being confusing," the spokesman says.
Changing Prices
Experts remind seniors that prescription discount card sponsors are still allowed to alter prices as well as their percentage discounts as often as weekly. That means that a 20% discount one month could wind up substantially higher -- or lower -- on the next prescription refill. But Medicare will be monitoring price changes and will identify programs that deviate from the expected changes in pricing.
Many drug companies and pharmacies already offer discount cards of their own, though the Medicare-approved prescription discount card can't be used at the same time. Seniors with multiple cards should ask lots of questions to find out which one works best from month to month.
"Every time you go to the pharmacy, you want to figure out which of your cards will work the best. And it will change," Ginzler says.
Not Just Savings
Few cards will cover all drugs for most patients, and in the end, bottom-line discounts for most will land somewhere in the 10% to 15% range, estimates Trudy Lieberman, the director of the Center for Consumer Health Choices at the Consumers Union in Yonkers, N.Y.
Price alone "is not how you need to pick a card," she says.
Medicare beneficiaries will also need to find out how these prescription discount cards work with other drug benefits they may already have. Up to 2/3 of seniors have some form of private insurance through a former employer or the government that covers some drug cost. It is not yet clear how those pharmacies will treat existing cost-sharing arrangements, Lieberman says.
"This is an important issue for these people," she says.
Lieberman also cautions people to find out if their favorite pharmacy plans to honor the card they want. Different pharmacy chains take different cards, so take it into account if getting the biggest discount means switching stores, she says.
Low-Income Benefit
Despite their cautions, advocates are most excited about the card program's benefits for up to 7 million low-income seniors. Those with annual incomes below $12,560 per year for individuals and $16,862 for couples are automatically entitled to a $600-per-year credit to help pay for their prescription drugs on top of any discounts.
The credit will come embedded in the card they choose and will be deducted like a debit card as they buy prescription drugs, according to Medicare. The Social Security Administration is ready to send out mailers to all seniors who qualify for the money. Lieberman recommends that seniors and their families contact their State Health Insurance Program (SHIP) to find out if they qualify.
"That's a good benefit for people if they understand what they have to do to get it," she says.
Ask Your Pharmacist
"The pharmacists knows what medications you are taking and would be the best person with the best advice" on discount cards, says Mary Ann Wagner, the president of the Pharmacy Care Alliance, a joint venture of the National Association of Chain Drug Stores (NACDS) and pharmacy benefit manager at Express Scripts Inc. The alliance is set to market its own discount card that some, though probably not all, big chain drug stores will honor, she says.
Wagner says that the NACDS is working to educate pharmacists about the prescription discount card program so that they can answer beneficiaries' questions. Still, big chains have worried that their busy pharmacists could have trouble handing an onslaught of questions from confused seniors.
"That's a tremendous concern that all of the chains are wrestling with," she says. The bottom line is that some pharmacies may be willing to sit down and help you fill out your enrollment application, while others may just hand you a pamphlet and tell you to call Medicare. "It varies," Wagner says.
Send It In
Once you've checked out discounts, pharmacy locations, low-income eligibility, and existing private drug coverage, you'll be ready to mail in your application. Private sponsors will be responsible for notifying Medicare when they sign you up in order to enforce the one-card-per-beneficiary rule.
Experts warn to make your final decision and then send in a single enrollment application. If you send in more, Medicare will lock you in to the first one that is processed. "Only apply to one. This is not like applying to college," Ginzler says.
After that, many seniors may have to 'go with the flow' on their drug discounts. Remember that if your card winds up being less beneficial than you hoped, you can apply for a new 2005 card starting in November 2004. The program ends altogether in 2006, when the Medicare prescription drug benefit kicks in.
"I don't think that there are any guarantees. We're all learning," Wagner says.
Additional Resources
AARP plans to offer a drug comparison worksheet to help seniors itemize the drugs they use and how much they pay. The worksheet will be available at www.aarp.org at the end of April.
Consumers Union and the California Health Care Foundation will offer a report in mid April with information about prescription drug cards nationwide. It can be found at www.calmedicareoptions.org.
Published March 25, 2004.
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