Open Enrollment Ends Dec. 31 for Medicare Recipients

The new healthcare reform law is responsible for some of the changes that retirees will see in their Medicare options for next year, but not for all of those changes. The following is a summary of the changes coming for the 2011 coverage year. Medicare recipients need to select their 2011 prescription coverage plan from a slate of up to 38 drug plans.

Of the ten most popular drug plans, three will give subscribers a price break. The AARP MedicareRx Preferred plan will see a drop of about 11 percent in the cost of premiums. The CVS Caremark Value and Advantage Star plans will drop about two percent. The seven other most popular plans will rise anywhere from three percent to 20 percent.

This is a big jump for those enrolled in in the First Health Part D Premier plan. My advice is to first, take your list of prescriptions for review by your doctor; he may find some overlap or duplication in your medications. Failing that, he may be able to locate a less expensive version of a drug or mineral supplement.

My next suggestion is to find out if you might qualify under a program for veterans. Vets can qualify for benefits (or pensions) based on either low income or disability; in most cases their drug coverage is much better than under any Medicare plan. The vet need not have served overseas to qualify. A veteran's widow can also qualify for benefits under her late husband's status. A widow needs to locate her husband's discharge papers for the necessary information, and take herself to an Office of Veterans Affairs (or the local VFW post). See related article linked below for more details.

Returning to the topic of 2011 drug plans: Humana offers the lowest-priced drug plan at $14.80 per month. Enhanced plans will offer some type of coverage while recipients are in the so-called 'donut hole', but their premiums will vary from state to state. Premiums in Alaska are nearly twice what they are in Arizona ($52 compared to $32.90).

Retirees who have higher incomes will pay more for both their Medicare premiums and for their drug plans. The higher rates affect those with incomes above $85,000 per year for singles or $170,000 per year for couples.

The biggest change that the healthcare reform law has wrought is that there will now be some type of relief for those who fall into the donut hole. Before, Medicare recipients had to pay 100 percent of the drug bill. Now, most plans will offer a half-off discount, at the same time that the full cost of the drug is applied to the donut hole.

To clarify, brand-name drugs will come with a 50 percent discount, and generic drugs will be discounted 7 percent.

How Much Will You Pay in Premiums?

IF you paid $96.40 per month for your Part B premium in 2010, you will pay the same amount in 2011.

IF you paid $110.50 per month for your Part B premium in 2010, AND it was deducted from your Social Security check, then you will pay the same amount in 2011.

IF your premiums are NOT deducted from your Social Security check, OR you are a new enrollee, then you will pay $115.40 per month in Part B premiums.

IF you are single and your taxable income is is more than $85,000, then you will pay between $161.50 and $369.10 per month in Part B premiums.

IF you are married and your joint taxable income is over $170,000, then you will pay between $161.50 and $369.10 per month in Part B premiums.

If your taxable income is the same as for the higher-income Part B premiums indicated above, then you will also pay a surcharge of $12 to $69.10 per month for the Part D drug plan.

However, recipients will also see some new benefits. The annual exam and many health screenings will be free of charge in 2011. Free screenings will include mammograms and colorectal cancer tests. Your out-of-pocket costs will be capped at $6,700 per year in the Medicare Advantage plans. And many HMOs have set the cap even lower; some of them have set it at $3,400 per year. Traditional Medicare, however, will not have caps on your out-of-pocket expenses, so bear that in mind when reviewing your expenses from this past year.

Avail yourselves of the convenient comparison tool online at www.medicare.gov. It will calculate your expenses for you under each of the plans available in your area. Those without computer access may call a toll-free number at 1-800-633-4227.

Medicare recipients may notice that some options will not be offered for 2011, although that is not related in any way to the healthcare reform bill. The AARP MedicareRx Saver plan will not be offered, and neither will the PrescribaRx Bronze plan. Together they covered almost two million recipients in 2010. Some new plans will be rolled out, and in general the plans offered should be simpler to understand and have less overlap.

Medicare Advantage will not be affected by changes imposed by the healthcare reform law until 2012. At that time, some of the HMO and PPO managed care plans will receive lower subsidies. A different 2008 law will take effect in 2011, and require private fee for service plans to establish contracts with physicians. But in only a few rural areas will there be no type of Medicare Advantage option: 28 counties in Colorado and one in Utah. Recipients will have to return to a traditional Medicare plan for 2011.

I hope that this article will some of my readers to find information applicable to their situation. Please refer to other articles on Associated Content and on the Medicare website for more details and individual attention.